Financially Distressed Companies Under Turkish Commercial Code

Introduction

To provide a definite scope of what is stipulated under law, thus what we will delve into in this article, the starting point would be to define what would constitute a financially distressed company. It must also be noted that what we call a company for the purposes of this article would be a joint-stock company. The Turkish Commercial Code Numbered 6102 (the "Code") uses certain technical reference points to define and regulate financially distressed companies. The lawmaker intends to regulate this area, so that it could provide protection for shareholders, creditors, and, ultimately, the whole economic environment by protection of share capital. The same provisions of the Code serve also as a guidance tool for the shareholders and the board of directors of the financially distressed company.