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ARTICLE · 28 JULY 2010

Demergers and Privatizations

Demerger of the capital stock companies is a model of restructuring of the companies. Despite of being an important part of the Commercial Law, demergers were not regulated under Turkish Commercial Code.

TurkeyCorporate/Commercial Law
A. Berke Canberk
A. Berke Canberk

1. DEVELOPMENT OF DEMERGERS IN TURKISH LAW

Demerger of the capital stock companies is a model of restructuring of the companies. Despite of being an important part of the Commercial Law, demergers were not regulated under Turkish Commercial Code. First legislation enacted regarding the demergers is the Decree Law on State Economic Enterprises numbered 233 dated June 18, 1984. Following this Decree Law, demerging of the companies is enabled with the Decree of the Council of Ministers. For instance, a significant legislation on demergers is the Decree of the Council of Ministers on Restructuring of the "Turkish Electricity Corporation" by demerging into "Turkish Electricity Generation and Transmission Company" and "Turkish Electricity Distribution Company" in 1994.

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