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ARTICLE · 09 JUNE 2014

Can Shareholders Borrow From Their Company?

A majority of companies in Turkey are family owned companies as their equivalents around the world.

TurkeyCorporate/Commercial Law

Majority of companies in Turkey are family owned companies as their equivalents around the world. It is predicted that over 70 % of companies are family owned companies in the world. Family owned companies differ from other companies by their policies and management. Mostly, in family owned companies "the boss" (mostly the founding partner of the company) takes over whole management of the company and wants to carry out all business by his hand even daily products purchase and expenses. Since the founding partner carries out all business and holds power, company becomes an asset for the founding partner and his family; therefore, it becomes usual that company's assets and resources can be used freely by the family members who own the company. Borrowing money from the company or application of a fund can be examples to this.

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