Turkish Commercial Code No. 6102 (“TCC”) preserves the rule that the board of directors shall manage and represent joint stock companies. The TCC regulates how the power of representation shall be exercised, the registration and announcement of the persons authorized to represent, the transfer of the power of representation and its limits. Below, the power of representation in joint stock companies, especially the delegation of authority, is briefly discussed.
Exercise of Representative Authority
As a rule, the representation of the joint stock company in external relations belongs to the board of directors. A joint stock company is a merchant, and pursuant to Article 39/1 of the TCC, merchants are obliged to carry out the transactions related to their commercial enterprises under their commercial titles and to affix their signatures under the title. The “signature” of the joint stock company is the signature of its representatives. The power of representation is exercised through the signatures of authorized signatories under the trade name of the joint stock company. This rule is repeated in Article 372/2 of the TCC.
As a rule, the joint signature (double signature) of two of the representatives authorized to sign on behalf of the company is required. However, Article 370 of the TCC provides two exceptions to this rule. The first exception is where the articles of association of the company stipulates a different rule than double signature. The second exception is when the board of directors consists of a single member.
