October 10, 2021

We will provide information in this article about capital increase in Joint Stock Companies in Turkey.

Transaction of Joint Stock Company Registered Capital Increase

A request number should be obtained from the Central Registry System and an application should be made to the regional representative without an appointment.

The Board of Directors determines the principles of exercising the right to buy new shares with a decision and gives the shareholders at least fifteen days for this decision. Prior to the registration of the capital increase, this decision regarding the determination of the principles for the exercise of the right of the board of directors to purchase new shares should be registered and announced. (This issue is not requested if the decision is taken unanimously and with the participation of all partners in the general assembly where the capital increase is discussed.)

1-) Petition

  • It should be signed by the authorized person with the company stamp, if signed by proxy, the original or certified copy of the power of attorney should be attached, and the accompanying document should be included.

2-) Notarized meeting minutes from the General Assembly resolution book regarding the capital increase in the basic capital system, and notarized copy of the resolution of the board of directors in the registered capital system (1 copy)

3-) Ministry representative assignment letter

4-) List of Attendants

5-) Amendment text as accepted in the general assembly showing that all the shares constituting the increased capital have been committed (1 copy)

6-) Permission or opinion letter for companies whose Articles of Association are subject to the permission or approval of the Ministry or other official institutions.

7-)  Statement issued by the board of directors according to the type of capital increase (as per article 457 of the Turkish Commercial Code)

😎 If the capital increase is made only from internal resources or through capital commitment or from internal resources together with capital commitment, certified public accountant’s report or independent accountant financial advisor’s report (The report should include the statement that the capital is protected according to the Turkish Commercial Code 376, according to the last balance sheet. In the report, the determination of the equity should be written numerically and the calculation table should be included, the balance sheet date should not be older than 6 months) and activity certificate, or the auditor’s report on these determinations in companies subject to audit, stating that the entire capital is paid, whether it is unrequited and the amount covered by internal resources for the determination of the company’s equity actually exists within the company. (If the capital increase is covered by the joint receivables, it should be clearly stated in the Certified Public Accountant’s report that the amount in the joint receivables account originates from CASH BORROWING. If the joint receivables are not due to cash borrowing, the Expert Report and the Expert Appointment Letter must be submitted)

9-) In case the capital increase is made only from internal resources, a sworn public accountant or certified public accountant’s report stating that the company’s capital is protected within the equity and the amount increased from internal resources actually exists within the company, or, in companies subject to audit, the auditor’s report on these determinations and the financial advisor activity document

10-) The original or certified copies of the expert’s report on the valuation prepared by the court-appointed expert regarding the determination of the value of the enterprises to be acquired and capital in kind during the capital increase with the capital in kind and the original or certified copies of the court’s expert appointment letter

11-) A letter from the relevant registry stating that there is no restriction on the capital in kind.

12-) Document showing that the immovable, intellectual property rights and other values placed as capital in kind are annotated to the registries where they are registered.

13-) In case of limitation or removal of priority rights, Board of Directors report showing the reasons for this, the reasons for issuing new shares with and without premium, and how the premium is calculated (2 copies)14-) Four out of ten thousand of the capital must be deposited to the chamber counter of the Competition Authority’s share.

15-) Regarding the payment of the minimum amount specified in the law or the Articles of Association; Bank letter showing the name, surname/title of the company partners who deposited money into the bank account opened, the amounts deposited by each partner and the total deposited amount

  • If all or part of the company’s capital is committed in cash, at least 1/4 of the nominal value of the shares committed in cash must be paid before the registration and the remaining part must be paid within twenty-four months following the registration of the company.

16-) If the shares representing the capital in the new form of the capital clause of the articles of association are not included in the amendment text, in case of using the attached subsidiary undertaking sample of the subsidiary undertakings signed by the subscriber, which is drawn up in accordance with Article 459 of the Turkish Commercial Code, the cash must be filled in for all partners participating in the capital increase and signed by all partners.

17-) If the decision of the general assembly to amend the Articles of Association, to authorize the board of directors to increase the capital and the decision of the board of directors to increase the capital violate the rights of the privileged shareholders, a notarized copy of the resolution to be taken by the special assembly of privileged shareholders, a list containing at least the number of signatures of those who voted negatively for the general assembly resolution, and a common notification address.

18-) Unless the cash values of the shares are fully paid, no increase can be made through capital commitment. If the increase cannot be registered within three months from the date of the general assembly or Board of Directors decision, the decision of the general assembly or the board of directors and, if taken, the permission becomes invalid. (Turkish Commercial Code 456/3)

In order to increase the capital through capital commitment in joint stock companies that have the funds allowed by the legislation to be added to the capital in their balance sheets and that are not open to the public or that do not apply to the Capital Markets Board to go public, funds as well as the amount of capital increase to be made through capital commitment should be converted into capital simultaneously. Capital can be increased by committing a higher amount of capital than the amount of funds simultaneously, without the funds being converted into capital or while the funds are being converted into capital, subject to the condition that all shareholders are represented at the general assembly meeting to be held for this purpose and that the decision on the capital increase is taken unanimously.


Example 1:  (In case of negative equity)

Capital: 60.000 TL

Equity: -25.000 TL (minus)

Formula: (Capital + Equity) x 2 = Final Capital

(60.000 TL + 25.000 TL) x 2 = 170,000 TL It is necessary to increase the capital to at least 170.000 TL, and the remaining 110,000 TL must be paid in full. In this case, together with the payment of 110.000 TL, the final capital of 85.000 TL, which is half of 170.000 TL, and the loss of 25.000 TL, as mentioned in the communiqué, are covered

Example 2: (In case the equity is plus and within the scope of 376)

Capital: 70.000 TL

Equity: 8.000 TL (plus)

Formula: (Half of existing capital – equity) x 2 = Amount of Capital to Increase

(35.000 TL – 8.000 TL) x 2 = 54.000 TL The capital must be increased to at least 70.000 TL + 54.000 TL = 124.000 TL. The remaining 54,000 TL must be paid in full. In this case, when the existing equity, which is 8.000 TL, is added to the 54.000 TL paid, a total of 62.000 TL, as mentioned in the communiqué, is half of the last capital.

Important Note: The above amounts have been determined according to the minimum amount to be paid. Amounts to be paid may vary according to the last capital.

Please contact us for your questions regarding joint stock company capital increases in Turkey. info@karenaudit.com

Source: Karen Audit – Translated by Karen Audit – The rights of this translation belong to KarenAudit and unauthorized use is prohibited.
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.