Conversion Of The Commercial Enterprise

Introduction

Conversion of type is one of the corporate restructuring transactions. Conversion was regulated under a single article of the abrogated Turkish Commercial Code No. 6762, and a special provision was introduced with respect to the conversion of a joint stock company into a limited liability company without a liquidation procedure. Nonetheless, there were certain problems with regards to the conversion of limited liability companies to unlimited liability companies and vice versa, both under the Court of Cassation precedents and Trade Registry practices.

The new Turkish Commercial Code No. 6102¹ ("TCC") introduced detailed provisions and innovations governing conversion of type and clarified certain disputed matters. The principle of continuity of the converted company under the new type, which was accepted under the abrogated code, was preserved. A detailed explanation on conversion of type can be found in the relevant article of the Erdem&Erdem December