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required incorporation. Shareholders may be natural persons or legal entities, residents, or non-residents in Turkey. In both corporate forms, there is no obligation for directors and managers to reside in Turkey or to be Turkish citizens. 3. Minority Shareholders ’ Rights and Protection for the Minority sharehold ers’ rig hts are regulated under the TCC. Minority shareholders have right to request the followings: • extraordinary general assembly meeting to be convened, or that a time to the agenda of the general assembly meeting to be added, • postponement of balance sheet discussions for one month to have a chance to review the balance sheet in detail,
treatment principle is applicable by all means. Therefore, there are no significant barriers to entry for an offshore party. Thin Capitalization According to Corporate Income Tax Law, if the total of the borrowings of a corporation, which are obtained directly or indirectly from its shareholders or persons to the shareholders and used in the business, exceeds three times the equity capital of the corporation at any time within the fiscal year, the excess part of the borrowings will be considered as thin capital for the relevant fiscal year. However, borrowings such as loans borrowed by banks or from third parties based on non-cash guarantees provided by the shareholders or persons related to the shareholders are not deemed to be thin capital. Capitalization Obligation The incorporation of a company requires the minimum capital as stipulated in the TCC. Accordingly, the minimum capital amount required for an anonim şir ket is TL 250,000 (approx. EUR 7,143) while TL 50,000 (approx. EUR 1,430) is for a limited şi rket . For anonim şir ket , if the shares are stipulated in cash, at least 25% of the related capital should be paid during the registration process and the unpaid amount should be paid within 24 months after registration. For limite d şir ket, a payment during the registration process is not required, 100% of the shares should be paid within 24 months after registration. Assets including intellectual property
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• under circumstances requesting dissolution of the anonim şir ket by filing a lawsuit, Minority shareholders may also be granted the right to be represented on the board of directors by the articles of association. Apart from the rights mentioned above, meeting and decision quorums also have an impact on minority rights. For instance, the consent of at least 75% of shareholders of anonim şir ket are required to change the scope of the company. D. Foreign Investment, Thin Capitalization, Residency and Material Visa Restrictions • Barriers to Entry for An Offshore Party All the procedures for incorporating foreign-invested companies are the same as local companies. The national
ILN Corporate Group – Establishing a Business Entity Series
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