Share Transfers In Limited Liability Partnerships

In Turkey, investors are prone to form or participate in joint stock corporations rather than limited liability partnerships ("LLP"s), because joint stock corporations generally enable them to establish their investments on a solid corporate governance structure. On the other hand, since the newly enacted Turkish Commercial Code (the "TCC") offers a more flexible corporate governance structure in LLPs compared to joint stock corporations, interest in LLPs has relatively increased in recent years. This bulletin aims to provide a summary of share transfer mechanics in LLPs.

Execution of Share Transfer Agreement

Under the TCC, shares in an LLP can be transferred only by executing a written agreement before the notary public. Accordingly, the transferor and the transferee must execute a share transfer agreement before the notary public, to perform the share transfer. This would trigger notarization costs for the transaction parties, in addition to other costs