Newsletter-21

59 COMMERCIAL LAW Important Reason in Terms of Share Transfer Restrictions* Att. Ecem Cetinyilmaz Introduction Article 491 of Turkish Commercial Code No. 6102 1 (“TCC”) regulates statutory restriction by setting forth that the paid-in regis- tered shares of joint stock companies can be transferred only with the approval of the company; whereas Article 492 enables the restriction of share transfers by the articles of association (“contractual restric- tion”). Notwithstanding, restriction of a share transfer is possible only under limited and exceptional cases; a transfer cannot be restricted for convenience or merely upon request 2 . The company may refuse the request for approval of the transfer of non-listed registered shares only for an “important reason” specified under the articles of association, or by proposing that it buys such shares, that other shareholders purchase the shares, or that third parties purchase them for their real value at the time of application. This Newsletter article examines the important reasons that a joint stock company can abstain from approving the transfer of non-listed registered shares. Concept of Important Reason Whereas it is possible for a company to refuse the request for approval due to an important reason under the articles of association, Article 493/2 of the TCC limits the concept of important reason, not being subject to the numerus clausus principle. Accordingly, provi- sions of the articles of association regarding the composition of en- * Article of January 2016 1 Turkish Commercial Code No. 6012 was published in the Official Gazette dated February 14, 2011 and numbered 27846, and entered into force on July 1, 2012. 2 Ünal Tekinalp , Sermaye Ortaklıklarının Yeni Hukuku, 3 rd Edition, İstanbul 2013, p. 127.