Call Procedure to be Followed for Calling General Assembly Meetings

General assembly meetings are gatherings where shareholders—members of one of the mandatory corporate organs of a joint stock company—convene to make decisions on matters within the authority of the general assembly and to exercise their rights under the Turkish Commercial Code (“TCC”), except in cases where statutory exceptions apply.

Unless the general assembly meeting is held without a formal call (i.e., without notice), the procedure for issuing such a call and the individuals authorized to do so are regulated by the TCC and the Regulation on the Procedures and Principles of General Assembly Meetings of Joint Stock Companies and the Presence of Ministry Representatives at Such Meetings (“Regulation”).

This memorandum solely addresses the call procedure for general assembly meetings of joint stock companies; procedures applicable to limited liability companies, as well as general assembly meetings held without a formal call for either type of company, are excluded from this scope.

Parties Authorized to Call the Meeting

a) Board of Directors
The primary authority to convene the general assembly rests with the board of directors. The board may call a general assembly even if its term has expired.

b) Liquidators and Court-Appointed Trustees (Kayyım)
Pursuant to article 410/1 of the TCC and article 9/6 of the Regulation, if the company is under liquidation, the liquidators are authorized to call a general assembly to discuss matters relevant to the liquidation process.

If a trustee (kayyım) has been appointed to the company, such trustee may also exercise the board’s authority to convene a general assembly.

c) Sole Shareholder
Under article 410/2 of the TCC, where the board of directors is permanently unable to meet, or cannot achieve quorum, or is otherwise unavailable, a sole shareholder may petition the court for authorization to call a general assembly.

d) Minority Shareholders
In privately held companies, shareholders holding at least one-tenth of the share capital, and in publicly held companies, those holding one-twentieth, are deemed minority shareholders.

Pursuant to article 411of the TCC and article 9/3 of the Regulation, minority shareholders may, by notary notice, request the board of directors to call a general assembly or to add specific agenda items to an already scheduled meeting. The request must be in writing, include justifiable reasons and the proposed agenda, and be delivered prior to the payment of the publication fee for the call notice in the Turkish Trade Registry Gazette.

If the board accepts the request, it must convene the general assembly within 45 days. Otherwise, the requesting shareholders may proceed with the call themselves.

If the board rejects the request or fails to respond within seven business days, shareholders may apply to the commercial court in the company’s jurisdiction for an order to hold the meeting. If granted, the court will appoint a trustee to organize the meeting and issue the necessary call, limited to that purpose alone—this role should not be confused with a management trustee.

Timing of the General Assembly Meeting

General assembly meetings are classified as either ordinary or extraordinary by convening time. The ordinary general assembly must be held within three months following the end of each fiscal year. If the articles of association do not specify a different fiscal year, the meeting must be held by the end of March.

Extraordinary meetings may be held at any time as needed.

Determining the Agenda

The agenda outlines the matters to be discussed at the general assembly. Except where provided otherwise by law, issues not included on the agenda may neither be discussed nor resolved.

The agenda is determined by the party issuing the call, as detailed above.

Extraordinary general assemblies are not subject to a mandatory agenda, but the ordinary general assembly must include at least the following items as per the TCC and the Regulation:

a) Opening and election of the meeting chair.

b) Reading and discussion of the annual report prepared by the board.

c) Reading of the auditor’s report.

d) Reading, discussion, and approval of the financial statements.

e) Release of board members from liability.

f) Determination of profit distribution and dividend allocation.

g) Setting remuneration, attendance fees, bonuses, and other compensation for board members.

h) Approval of board member appointments made to fill vacancies during the fiscal year.

i) Election of board members whose terms have expired; if terms are not defined in the articles, determination thereof.

j) Appointment of the auditor.

Call Procedure

Pursuant to TCC Article 414/1 and Regulation Article 10/1, the general assembly must be convened in the manner provided in the articles of association. Companies required to maintain a corporate website must publish the call on their website and, in all cases, in the Turkish Trade Registry Gazette. If the company allows electronic participation, the call must also be made through the electronic general assembly system.

In addition, call must be sent via registered mail to shareholders whose information appears in the share ledger or who have submitted share certificates or ownership documentation and notified their addresses.

The call must be published at least two weeks before the meeting date, excluding the dates of publication and the meeting itself. However, due to processing times at the trade registry, we recommend submitting the notice to the registry no later than 21 days before the meeting (again excluding the notice and meeting dates).

Content of the Notice

Under article 11of the Regulation, both the notice published and the letters sent to shareholders must include the following:

a) Date and time of the meeting;

b) Meeting venue;

c) Agenda;

d) If an amendment to the articles of association is proposed, both the current and proposed versions of the relevant articles;

f) The identity of the party issuing the call;

g) If this is a reconvened meeting following a postponement, the reason for the postponement and the quorum required for the new meeting;

h) For ordinary general meetings, a statement that the financial statements, consolidated financials, annual board report, auditor’s report, and board’s profit distribution proposal are available for shareholder review at the company’s headquarters and branch offices.

The notice must also include a sample proxy form for shareholders who intend to be represented at the meeting.

Summary

The procedure for calling general assembly meetings of joint stock companies and the identification of authorized parties are extensively regulated. Compliance is a legal obligation. Failure to observe these formalities may result in annulment of the general assembly resolutions, per article 446/1-b of the TCC , if shareholders—regardless of attendance or voting status—are able to  prove that improper notice or agenda publication has affected the outcome of the resolution.