Conversion of a General or Limited Partnership into a Limited or Joint Stock Company

General Information

Pursuant to subparagraphs (b) and (c) of the first paragraph of Article 181 of the Turkish Commercial Code No. 6102, a general partnership or a limited partnership may be converted into a joint-stock company or a limited liability company. In such changes of type, the provisions on the incorporation of the joint-stock or limited liability company to be newly established shall apply. However, the provisions on the minimum number of partners and on contributions in kind shall not apply. In a change of type, the shares and rights of the partners in the company are protected.

The procedures relating to the change of type are set out below:

1- Change of type plan (Art. 185)

A written change-of-type plan shall be prepared by those in charge of the management of the company.

The change of type plan must include:

• The trade name and head office of the company before and after the change of type, and information on the new type,
• The articles of association of the new type if it is a joint-stock company, or the company agreement if it is a limited liability company,
• It must contain the number, class and amount of the shares that the partners will hold after the change of type, or the matters concerning the partners' shares after the change of type.

2- Change of type report (Art. 186)

Those in charge of the management of the company shall prepare a written report on the change of type.

In the report, the following matters are explained from legal and economic perspectives, with their justifications:

• The purpose and consequences of the conversion into the new type,
• The fact that the incorporation provisions applicable to the new type have been fulfilled,
• The company agreement of the new type,
• The exchange ratio applicable to the shares that the partners will hold in the new type,
• Where applicable, the additional payment and other personal performance obligations and personal liabilities of the partners arising from the conversion into the new type,
• The obligations of the partners arising from the change of type; these matters shall be explained from legal and economic perspectives, with the reasons stated.

(By decision of all partners, small and medium-sized companies may waive the preparation of the change of type report.)

3- The following matters shall be made available for the partners' inspection thirty days before the decision is taken at the partners' meeting: (Art. 188)

• The change of type plan,
• The change of type report,
• The financial statements of the last three years,
• An interim balance sheet, if more than six months have passed between the balance sheet date and the date on which the change of type report was prepared, or if significant changes have occurred in the company's assets since the date of the last balance sheet.

Copies of the said documents are provided free of charge to partners who request them. The company informs the partners in an appropriate manner of their right of review.

4-Approval of the general assembly and quorums (Art. 189)

Those in charge of the management of the company shall submit the change-of-type plan to the approval of the partners' meeting thirty days after the above procedures have been completed and the partners have been granted the right of inspection. The decision on the change of type is taken with the following quorums:

In general partnerships, the change-of-type plan is approved by the unanimous vote of all partners. However, the company agreement may provide that this decision can be taken by the affirmative vote of two thirds of all partners.

5- Registration (Art. 189/2)

Those in charge of the management of the company shall have the company agreement of the new-type company registered together with the general assembly resolution on the change of type. The change of type acquires legal validity upon registration. The decision on the change of type is announced in the Turkish Trade Registry Gazette.

DOCUMENTS TO BE SUBMITTED TO THE REGISTRY DIRECTORATE (TSY-130)

1. Change-of-type plan (TTK-185) (1 original)
2. Notarised Decision on Change of Type of the General Partnership Partners' Meeting approving the change-of-type plan (TTK-189) (1 original, 2 photocopies)
3. Change-of-Type Report prepared by the company's managers (TTK-186) (1 original).

   However, small and medium-sized companies may omit the change of type report if all partners approve, on the basis of an SME Report prepared by a certified public accountant (YMM) or an independent certified public accountant (SMMM).

4. The latest balance sheet approved by the company's managers and, where necessary, an interim balance sheet, and the stamp duty receipt (1 original)
5. The newly drawn up Limited Liability Company Agreement / Joint-Stock Company Articles of Association signed by the company's authorised representatives or partners (1 original, 1 photocopy).

   Notarisation or approval of the agreements by our Trade Registry Directorate is not mandatory, but they may be approved upon request.

6. A YMM or SMMM report (1 original) determining whether the capital of the company changing its type has been paid, whether it remains uncovered, the company's net assets, and, if the company has assets registered in the land, ship, intellectual property or similar registries, the fair values of those assets, together with the consultant's activity certificate; or, if the company changing its type is subject to audit, the auditor's report on these determinations together with the auditor's certificate

   (If there are no assets or rights required to be recorded in the said special registries, this must be declared.)

7. A declaration containing the list of the assets and rights of the converting company that are registered in the land, ship and intellectual property registries and similar registries, the registries in which they are registered, and information on the entries of these assets and rights in the relevant registries (1 original)
8. If the converting company is subject to the permission or favorable opinion of the Ministry or other official institutions, the letter of permission or favorable opinion
9. Specimen signature/signature declaration of the person(s) authorized to represent the company

   (If there is no signature record kept in the databases of public institutions and organisations, or the record cannot be obtained, the signatures of the persons concerned shall be submitted to the directorate either by having them physically notarised or by making a written declaration at any Trade Registry Directorate. In a change of type to a limited liability company, the signature declaration is made only at the Trade Registry Directorate.) (1 original)

   The specimen signatures of persons added as authorized signatories with the new identity card can be obtained electronically from NVİ and recorded in the MERSİS database. A physical signature declaration will not be requested for authorized persons in this situation. (Ministry Circular No. 72558467 dated 4/3/2022)

10. A receipt showing that four per ten thousand of the capital has been paid, in accordance with Law No. 4054 on the Protection of Competition.

    (It will be paid at the cashier's office of the Chamber to which our Directorate is affiliated or into the Chamber's bank account.)

11. If a joint-stock company is to be established and capital is contributed in cash, a bank letter and receipt showing that one quarter of it has been blocked.
12. New Registration Request Petition

Notes

• NOTE-1: In a change of type, in order for the assets and rights of the converting company that are registered in the land, ship and intellectual property registries and similar registries to be registered in the name of the new type without delay, the directorate shall notify the relevant registries immediately, simultaneously with the registration of the new type.

• NOTE-2: If, due to the change of type, the company has a branch or branches registered at our directorate where its head office is located or at another Trade Registry Directorate, a signed Branch Information Declaration must be submitted with the documents; if there are no branches, a signed declaration stating that there are none must be submitted.

NOTE:

You must submit an electronic application at https://mersis.ticaret.gov.tr/.

For Information and Support

Phone:

0 (378) 227 10 46

Extension: 125 E-mail:

info@bartintso.org.tr