Att. Leyla Orak; Erdem & Erdem (Turkey)

Introduction
The partnership between a joint stock company and its shareholder will cease, in principle, upon the transfer of shares by the shareholder. A holder of joint stock company shares may cease its partnership relationship voluntarily by transferring its shares to a third party.

Nevertheless, voluntary share transfer may not always be the answer to the specific needs. From the company’s perspective, it may be necessary to sever its partnership with a shareholder causing perturbation in the company, even in the absence of the shareholder’s will, by resorting to other means. For these reasons, a company’s right to squeeze-out shareholders is significant. Similarly, a non-controlling shareholder in a company may not want to be bound by the consequences of decisions in which they did not participate and may want to end the partnership, even in the absence of a prospective purchaser for its shares. For these reasons, the sell-out right of shareholders to sell their shares to another shareholder, and the exit right requiring the company to purchase their shares are very important.

In this article, the statutory provisions regarding squeeze-out, sell-out and exit rights will be analyzed.

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