The fundamental financial obligation of a shareholder in a limited liability company toward the company is to pay the value of the capital share they have undertaken. The company's share capital consists of the aggregate of the capital shares undertaken by the shareholders. The creditor regarding the shareholder's capital obligation is the company's legal entity. Therefore, the obligation to contribute capital does not imply that the shareholder is directly liable to creditors for the company's private law debts.<\/p>\n\n\n\n
The minimum principal capital amount prescribed for limited liability companies under Article 580 of the Turkish Commercial Code (TTK) has been raised to 50,000 TL, effective January 1, 2024, pursuant to Presidential Decision No. 7887. Furthermore, in accordance with Provisional Article 15\u2014added to the TTK by Law No. 7511\u2014existing limited liability companies with capital below this threshold are required to increase their capital to 50,000 TL by December 31, 2026; otherwise, the company shall be deemed dissolved. The Ministry of Trade has the authority to extend this deadline up to two times, for a period of one year each time.<\/p>\n\n\n\n
A capital contribution need not necessarily be made in cash. According to Article 581 of the Turkish Commercial Code (TTK), assets that are transferable and capable of being valued in monetary terms\u2014and which are free from limited real rights, attachments, or injunctions\u2014may be contributed as capital in kind. Intellectual property rights, as well as virtual environments and names, may also be considered within this scope. Conversely, performance of services, personal labor, business reputation, and unmatured receivables cannot be contributed as capital to a limited liability company.<\/p>\n\n\n\n
The value of the principal capital share may be paid in cash or in kind as stipulated in the articles of association, or it may be satisfied through the set-off of a receivable or by converting freely usable equity into principal capital during a capital increase. The method employed is significant for determining whether the capital obligation has been performed genuinely and in accordance with the prescribed procedure.<\/p>\n\n\n\n
Pursuant to Article 585 of the Turkish Commercial Code (TTK), a limited liability company is established when the founders declare their intent to form the company in the articles of association, in which they unconditionally undertake to pay the entire capital. The rule applicable to joint-stock companies\u2014requiring the payment of at least twenty-five percent of the nominal value of shares subscribed for in cash prior to registration\u2014does not apply to limited liability companies. However, the provisions governing joint-stock companies apply by analogy regarding the payment of capital share amounts, the place of payment, the obligation of performance, the consequences of non-performance, and the transfer of shares for which the price has not been fully paid.<\/p>\n\n\n\n
In this system, the commitment of capital must be distinguished from the actual payment of capital. A partner's undertaking of a specific amount of the principal capital share creates a capital obligation toward the company. If the obligation is not fulfilled when due, the company may claim default interest and\u2014subject to applicable conditions\u2014compensation for damages it has incurred, within the framework of the provisions governing joint-stock companies applied by analogy. It is also possible for the company to pursue its capital receivable through enforcement proceedings or litigation.<\/p>\n\n\n\n
Proof of the payment of the capital contribution obligation is also of practical importance. Bank transactions, payment documents, company records, and written documents indicating against which obligation the payment was offset must be evaluated collectively. It is not possible in every instance to assume that payments made by a shareholder to the company for various reasons are automatically offset against the capital contribution obligation; the legal basis for the payment must be ascertainable.<\/p>\n\n\n\n
Failure to fulfill the obligation to contribute capital does not merely result in the partner being in default; it also gives rise to the company's direct right to make a claim. Pursuant to Article 128\/7 of the Turkish Commercial Code (TTK)\u2014which applies to all commercial companies\u2014the company may demand that the partner fulfill the capital contribution obligation and may file a lawsuit to this end. If any additional loss has arisen due to the delay, compensation for such loss may also be claimed, subject to the conditions stipulated by law.<\/p>\n\n\n\n
n the decision of the 11th Civil Chamber of the Court of Cassation dated 20.01.2020 (Docket No. 2019\/2340, Decision No. 2020\/561), a dispute regarding the damages allegedly suffered by the company due to the failure to timely perform the capital contribution obligation was examined, and it was held that a breach of the obligation to contribute capital could also serve as a basis for a claim for compensation by the company.<\/p>\n\n\n\n
As a general rule, the company may claim compensation and file a lawsuit for damages incurred due to a partner\u2019s failure to perform, or delay in performing, their obligation to contribute capital.<\/em><\/p>\n\n\n\n However, a claim for compensation is not an automatic consequence independent of the non-payment of the capital contribution obligation. In the specific case at hand, the causal link between the loss alleged by the company and the failure to timely perform the capital contribution obligation must be established. Therefore, the collection of the capital receivable and the claim for damages arising from the delay must be evaluated separately.<\/p>\n\n\n\n Capital contributed to the company by a shareholder becomes part of the company's assets upon performance of the contribution. The fact that the company's assets are primarily liable for the limited company's debts makes capital preservation significant for company creditors as well. Therefore, a shareholder cannot freely demand the return of the same amount while the company's operations are ongoing, simply on the grounds that they have paid the value of their capital share.<\/p>\n\n\n\n Pursuant to Article 601 of the Turkish Commercial Code (TTK), unless the principal capital is reduced in accordance with the prescribed procedure, the value of the principal capital shares cannot be returned to the shareholders, nor can shareholders be released from their obligation to contribute capital. Thus, the arbitrary depletion of company assets for the benefit of shareholders is prevented, and the preservation of the principal capital within the company is ensured.<\/p>\n\n\n\n The obligation to make additional payments is a specific shareholder obligation that is distinct from the obligation to contribute capital and arises only if stipulated in the company\u2019s articles of association. Pursuant to Article 603 of the Turkish Commercial Code (TTK), shareholders may be required to make additional payments beyond the value of their principal capital shares. The purpose of this obligation is to provide the company\u2014particularly when it faces financial difficulties\u2014with additional resources from its shareholders; making such an additional payment does not increase the nominal value of the shareholder's principal capital share.<\/p>\n\n\n\n In the absence of a provision for additional payments in the articles of association, managers or the general assembly cannot unilaterally impose an obligation on shareholders to make additional payments on the grounds that the company requires financing. While this obligation may be included in the articles of association at the time of incorporation or introduced subsequently, the special approval requirement set forth in Article 607 of the Turkish Commercial Code (TTK) applies to its subsequent introduction or to any increase in an existing obligation.<\/p>\n\n\n\n The fact that an obligation for additional payments is stipulated in the articles of association does not mean that the shareholder is required to make such payments at all times. Article 603 of the Turkish Commercial Code (TTK) specifically limits the circumstances under which such a demand may be made. Accordingly, additional payments may be requested if the sum of the company\u2019s share capital and statutory reserves is insufficient to cover the company\u2019s losses, if the company cannot properly continue its operations without such additional payments, or if another event defined in the articles of association that gives rise to a need for equity occurs.<\/p>\n\n\n\n The authority to demand the fulfillment of the additional payment lies with the managers when these conditions are met. In the event that bankruptcy proceedings are initiated against the company, the obligation to make the additional payment becomes due by operation of law. Consequently, the mechanism of additional payment is not a general financing authority enabling the demand for unlimited funds from shareholders at any time deemed necessary; rather, both a basis in the company\u2019s articles of association and the existence of the statutory conditions for such a demand are required.<\/p>\n\n\n\n The law also limits the additional payment obligation in terms of amount. The obligation must be specified in the company agreement as a fixed amount based on the relevant capital share, and this amount may not exceed twice the nominal value of the capital share. Each shareholder is liable only for the additional payment corresponding to their own capital share.<\/p>\n\n\n\n For instance, the maximum additional payment obligation that may be stipulated for a principal capital share with a nominal value of 100,000 TL is 200,000 TL. This limit does not imply that the shareholder is required to pay 200,000 TL; the articles of association may stipulate a lower amount, and the actual demand for payment is further contingent upon the fulfillment of the conditions set forth in Article 603 of the Turkish Commercial Code (TTK). Furthermore, reducing or eliminating the additional payment obligation is possible only if the aggregate of the principal capital and statutory reserves fully covers the losses.<\/p>\n\n\n\n Since the obligation to make additional payments is linked to the principal capital share, it generally passes to the transferee upon the transfer of the share. However, the termination of shareholder status does not automatically eliminate the former shareholder's risk in every instance. Under Article 604 of the Turkish Commercial Code (TTK), if the company goes bankrupt within two years of the registration of the shareholder's departure, the former shareholder may also be required to fulfill the obligation to make additional payments.<\/p>\n\n\n\n The liability of the former shareholder is limited to cases where the successor has failed to fulfill the obligation for additional payment and where such obligation is enforceable against the former shareholder to the extent prescribed by law. Therefore, when transferring shares in companies subject to additional payment obligations, one must examine not only the transfer price but also the existing and potential additional payment obligations attached to the shares.<\/p>\n\n\n\n Unlike the principal capital contribution, an additional payment may be returned to the partner subject to certain conditions. For an additional payment made pursuant to Article 605 of the Turkish Commercial Code (TTK) to be returned\u2014either in whole or in part\u2014the amount to be refunded must be coverable by the company\u2019s freely disposable reserves and funds. This requirement aims to protect the company\u2019s financial structure and its creditors.<\/p>\n\n\n\n Therefore, the fact that an additional payment serves as a temporary financing instrument does not mean the partner can demand its return at any time. A statutory financial condition must be met for repayment to occur; otherwise, the payment remains within the company.<\/p>\n\n\n\n Article 606 of the Turkish Commercial Code (TTK) stipulates that the company agreement may provide for ancillary performance obligations that serve to facilitate the realization of the company's business purpose. Unlike the obligations to contribute capital or make additional payments, an ancillary performance obligation does not necessarily entail a monetary payment. Depending on the company's field of activity, ancillary performance obligations may be defined to include, for instance, the delivery of specific goods, production or supply activities, the granting of the right to use an asset, or the provision of specific services.<\/p>\n\n\n\n The subject matter, scope, conditions, and other significant aspects of an ancillary performance obligation attached to a capital share must be specified in the articles of association. Matters requiring detail may be left to regulation by the general assembly. Therefore, the fundamental elements of the obligation\u2014which affect the shareholder's economic and legal position\u2014must be ascertainable from the articles of association.<\/p>\n\n\n\n The law also prevents the circumvention of the additional payment regime under the guise of \"ancillary obligations.\" Obligations to provide performance in cash or in kind\u2014which serve to meet the company's equity requirements and lack either a consideration expressly stipulated in the company agreement or an appropriate consideration\u2014are subject to the provisions governing additional payments, even if they are designated as ancillary obligations. When determining the legal nature of the performance, its purpose and economic function are more significant than the name given to it.<\/p>\n\n\n\n Although the obligation to make an additional payment and the obligation to perform an ancillary service resemble each other in that both are stipulated in the company agreement, their purposes and conditions of application differ. The primary function of the additional payment is to meet the company's equity requirements and provide supplementary financing in instances of financial distress specified by law. For this reason, the Turkish Commercial Code (TTK) has explicitly regulated the circumstances under which an additional payment may be demanded and the upper limit of the amount.<\/p>\n\n\n\n An ancillary performance obligation serves the realization of the company's business purpose rather than its financing. For instance, it may be stipulated that producer partners deliver a specific quantity of products to the company or provide a particular service. However, if an obligation ostensibly structured as an ancillary performance is in reality a gratuitous contribution intended to meet the company's equity requirements, the provisions regarding additional payments under Article 606\/3 of the Turkish Commercial Code (TTK) shall apply.<\/p>\n\n\n\n Another common feature shared by additional payments and the principal capital is the prohibition on interest stipulated in Article 609 of the Turkish Commercial Code (TTK). No interest may be paid on the principal capital or on additional payments made. In this respect, an additional payment differs from a loan provided by a shareholder to the company in exchange for interest; its legal nature and the conditions for its repayment are governed directly by the special provisions applicable to limited liability companies.<\/p>\n\n\n\n The subsequent introduction of an obligation for additional payments or ancillary performances\u2014which did not exist when the partner joined the company\u2014can directly affect the partner's economic situation and the value of their share. For this reason, Article 607 of the Turkish Commercial Code (TTK) has established heightened protection for general assembly resolutions that amend the articles of association to introduce new obligations for additional payments or ancillary performances, or to increase existing obligations.<\/p>\n\n\n\n Such decisions can only be adopted with the consent of all relevant shareholders. Consequently, merely meeting the standard quorum for amending the articles of association at the general meeting is insufficient; the consent of all shareholders affected by the obligation is required. This provision serves as a crucial safeguard, preventing the imposition of new financial or personal obligations on minority shareholders through a majority decision.<\/p>\n\n\n\n Obligations regarding additional payments and ancillary performances are obligations linked to the capital share in a limited liability company. Therefore, when a share transfer takes place, it is necessary to examine not only the economic value of the share and the transfer price but also the personal obligations attached to the share. Article 595 of the Turkish Commercial Code (TTK) subjects the transfer of the capital share\u2014and the transactions giving rise to the obligation to transfer\u2014to a written form requirement and mandates that signatures be notarized; it also stipulates that obligations concerning additional payments and ancillary performances must be specified in the transfer agreement.<\/p>\n\n\n\n The existence of obligations regarding additional payments or ancillary duties in the articles of association is also significant during the share transfer approval process. If the transferee's financial capacity is deemed questionable and the requested security is not provided, the general assembly may refuse to approve the transfer, even in the absence of a specific provision to that effect in the articles of association. This arrangement serves to protect the company against the risk of future non-performance of obligations attached to the shares.<\/p>\n\n\n\n For this reason, it is important to examine the articles of association, the share register, and any prior demands for additional payments before the share transfer. Particularly in the case of a company with a weakened financial position, the acquired share may entail not only shareholder rights but also obligations for additional payments\u2014claimable upon the fulfillment of statutory conditions\u2014or ancillary obligations of a continuing nature.<\/p>\n\n\n\n The distinction between a limited liability company shareholder's capital contribution obligation and their obligations regarding additional payments and ancillary performances is clearly recognized in the case law of the Court of Cassation. In the decision of the General Assembly of Civil Chambers of the Court of Cassation dated May 25, 2021 (Docket No. 2017\/53, Decision No. 2021\/611)\u2014based on Article 573\/2 of the Turkish Commercial Code\u2014it was stated that, as a general rule, a shareholder is not liable for the company's private law debts; that the obligation to contribute capital is owed to the company; and that obligations regarding additional payments and ancillary performances can arise only within the framework of conditions prescribed by law.<\/p>\n\n\n\n A shareholder of a limited liability company may be held liable for obligations regarding additional payments and ancillary performances stipulated in the articles of association only within the framework of the forms and principles set forth in the aforementioned legal regulations.<\/em><\/p>\n\n\n\n The decision is significant in demonstrating that a company's financing needs or the internal relationship between partners do not, in themselves, create an unlimited payment obligation for a partner. When a payment or other performance\u2014beyond the capital contribution\u2014is demanded from a partner, it must first be determined whether the demand constitutes a capital contribution obligation, an additional payment, or an ancillary obligation; subsequently, it must be examined whether the company agreement contains the necessary provisions and whether the relevant statutory conditions have been met.<\/p>\n\n\n\n In limited liability companies, the fundamental obligation of shareholders towards the company is to pay the share of the principal capital they have subscribed to. This obligation is owed to the company as a legal entity and does not imply that shareholders are personally liable for the company's private law debts. However, if expressly stipulated in the articles of association, shareholders may be subject to additional payment obligations and ancillary performance obligations in addition to the obligation to contribute capital.<\/p>\n\n\n\n The obligation to make additional payments is intended to provide supplementary financing in the circumstances specified in Article 603 of the Turkish Commercial Code (TTK), where the company faces a need for equity. This obligation must be stipulated as a specific amount linked to the principal capital share and must not exceed twice the nominal value of the share. Merely having a provision in the articles of association is insufficient; the actual demand for payment must be based on the conditions prescribed by law. Reimbursement of the additional payment made is possible only if the financial condition set forth in Article 605 of the TTK is met.<\/p>\n\n\n\n An ancillary performance obligation serves the realization of the company\u2019s business purpose and may involve obligations other than the payment of money. The essential elements of the obligation must be specified in the company agreement. Merely designating gratuitous performances intended to meet the company\u2019s equity requirements as \u201cancillary performances\u201d does not permit the circumvention of the mandatory limits governing the additional payment regime.<\/p>\n\n\n\n Consequently, when evaluating the obligations of a limited liability company shareholder, it is insufficient to consider solely the amount of the capital share. The contents of the articles of association, whether the capital commitment has been fulfilled, the existence of any obligations for additional payments or ancillary performances, whether such obligations are structured within legal limits, and whether the conditions for a claim have been met in the specific case must all be examined collectively. Paying heed to these distinctions\u2014particularly in instances of share transfers, financial distress, and amendments to the articles of association\u2014is crucial for accurately determining the obligations existing between the shareholder and the company.<\/p>\n\n\n\n Author\/Attorney-at-Law Cem GONCEL\u0130<\/em><\/strong><\/p>\n\n\n\n <\/p>","protected":false},"excerpt":{"rendered":" Limited \u015firket, ortaklar\u0131n \u015firket bor\u00e7lar\u0131ndan kural olarak \u015fahsen sorumlu olmad\u0131\u011f\u0131 ve esas sermayeye dayanan bir sermaye \u015firketidir. Bununla birlikte ortaklar\u0131n \u015firkete kar\u015f\u0131 herhangi bir y\u00fck\u00fcml\u00fcl\u00fc\u011f\u00fc bulunmad\u0131\u011f\u0131 s\u00f6ylenemez. T\u00fcrk Ticaret Kanunu (TTK), orta\u011f\u0131n temel borcu olan sermaye koyma y\u00fck\u00fcml\u00fcl\u00fc\u011f\u00fcn\u00fcn yan\u0131nda, \u015firket s\u00f6zle\u015fmesinde \u00f6ng\u00f6r\u00fclmesi \u015fart\u0131yla ek \u00f6deme ve yan edim y\u00fck\u00fcml\u00fcl\u00fcklerinin de kararla\u015ft\u0131r\u0131lmas\u0131na imk\u00e2n tan\u0131maktad\u0131r.Capital Maintenance and the Prohibition on Repayment of Capital<\/h1>\n\n\n\n
6. Obligation to Make Additional Payments<\/h1>\n\n\n\n
\n
\n
\n
\n
7. Obligation of Ancillary Performance<\/h1>\n\n\n\n
8. The Difference Between Additional Payment and Ancillary Obligation<\/h1>\n\n\n\n
9. Subsequent Imposition or Increase of Obligations<\/h1>\n\n\n\n
10. Obligations Regarding Additional Payments and Ancillary Performances in Share Transfers<\/h3>\n\n\n\n
11. The Approach of the Court of Cassation<\/h1>\n\n\n\n
12. Conclusion<\/h1>\n\n\n\n
\nTTK\u2019n\u0131n 573. maddesine g\u00f6re ortaklar, \u015firket bor\u00e7lar\u0131ndan sorumlu olmay\u0131p taahh\u00fct ettikleri esas sermaye paylar\u0131n\u0131 \u00f6demek ve \u015firket s\u00f6zle\u015fmesinde \u00f6ng\u00f6r\u00fclm\u00fc\u015fse ek \u00f6deme ile yan edim y\u00fck\u00fcml\u00fcl\u00fcklerini yerine getirmekle y\u00fck\u00fcml\u00fcd\u00fcr. Bu \u00fc\u00e7 y\u00fck\u00fcml\u00fcl\u00fck ayn\u0131 amaca hizmet etmez: sermaye koyma borcu \u015firketin ba\u015flang\u0131\u00e7 ve devaml\u0131l\u0131k sermayesini olu\u015ftururken, ek \u00f6deme belirli mali s\u0131k\u0131nt\u0131 h\u00e2llerinde ilave finansman sa\u011flamakta; yan edim ise \u015firketin i\u015fletme konusunun ger\u00e7ekle\u015ftirilmesine hizmet eden farkl\u0131 edimleri konu edinmektedir. Bu \u00e7al\u0131\u015fmada s\u00f6z konusu y\u00fck\u00fcml\u00fcl\u00fcklerin kapsam\u0131, s\u0131n\u0131rlar\u0131 ve birbirlerinden ayr\u0131ld\u0131klar\u0131 noktalar ele al\u0131nmaktad\u0131r.<\/p>","protected":false},"author":1,"featured_media":50,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[25,23],"tags":[],"class_list":["post-48","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-sirketler-hukuku","category-ticaret-hukuku"],"_links":{"self":[{"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/posts\/48","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/comments?post=48"}],"version-history":[{"count":2,"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/posts\/48\/revisions"}],"predecessor-version":[{"id":52,"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/posts\/48\/revisions\/52"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/media\/50"}],"wp:attachment":[{"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/media?parent=48"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/categories?post=48"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/communlaw.com\/en\/wp-json\/wp\/v2\/tags?post=48"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}