General Assembly, Board of Directors and Board of Managers Procedures
The company’s will is formed through its competent organs. Failure to convene the general assembly properly, a wrongly framed agenda, failure to meet the meeting or resolution quorum, incorrect exercise of voting rights or action by unauthorized persons may affect the validity of resolutions.
In general assembly and management processes, the following are
- Preparation for ordinary and extraordinary meetings
- Notice, agenda, announcement and notification to shareholders
- Attendance list, proxy and representation checks
- Determining meeting and resolution quorums
- Whether a special meeting of privileged shareholders is required
- Application for a Ministry representative where necessary
- Preparation of the meeting minutes and the text of resolutions
- Meeting and resolution processes in an electronic environment
- Election and removal of members of the board of directors or of managers
- Allocation of duties, delegation of authority and internal directives
- Authority to represent and bind the company, and the signing arrangements
- Registration and announcement of resolutions
addressed. The mere fact that a resolution has been registered with the trade registry does not mean that its content is lawful in every case.
Shareholding, Minority Rights and Special Audit
Shareholders’ rights are not limited to attending the general assembly and voting. The rights to information and inspection, to dividends, to pre-emptive subscription (rüçhan), to a liquidation share, to bring an action against general assembly resolutions and, under certain conditions, to request a special audit are assessed according to the company type and the specific case.
The main transactions and disputes in this area are:
- Determining shareholder status and percentage of shares
- Registration in the share ledger and correction of the entry
- Attending the general assembly, representation and voting rights
- Requests for information and inspection
- Requests for the appointment of a special auditor
- The minority convening the general assembly or having an item added to the agenda
- Assessment of financial statements and annual reports
- Profit distribution and dividend claims
- Exercising or restricting the pre-emptive subscription right (rüçhan)
- Violation of privileges and of the principle of equal treatment
- A shareholder’s claims for loss against the company or the other shareholders
In exercising these rights, different procedures and time limits may apply depending on the company type, the percentage of shares and the nature of the request.
Documents to Prepare Before the Meeting
The notice, agenda, representation documents, financial statements and draft resolutions are reviewed together. The accurate recording of attendance, votes, dissent and requests for information matters in any later dispute.
Make the request for information specific
It must be stated clearly which transaction and period are to be reviewed, and when and how an earlier application was made. In the event of a refusal or a lack of response, different application procedures exist depending on the company type; the date of the application and the response records should be kept.
A special audit is not the same as an independent audit
A special audit request aimed at clarifying a specific event does not replace the company’s ordinary independent audit. The persons who may make the request, the earlier request for information, the general assembly stage and the court’s conditions are assessed together.
Consistency of resolution and representation records
The consistency of the internal directive, the delegation of authority, the registered form of representation and the signing authorities is checked. It should not be assumed that every limitation in the internal relationship can be asserted against third parties in the same way.