Anonim Şirketlerde Kâr Payı Hakkı

Profit is a word of Persian origin. The dictionary meaning of profit is the money gain from shopping. According to another definition, profit is the increase in the assets of a commercial enterprise due to its economic activities within a certain period of time. In order for joint stock companies to distribute profit, the company must make a profit, that is, profit must appear in the commercial balance sheet of the company.

According to the definition made in the Communiqué Serial: 4, No. 27 issued by the Capital Markets Board, dividend refers to the share of the profit to be distributed to the shareholders of the joint stock company and other persons participating in the profit, each of them. There is no distinction between real and legal persons in terms of shareholding. The important point for the shareholder here is to provide a material benefit in return for participation in the company. While the material benefit that may be provided may be in different forms, the most important and lasting of these is the dividend that the person will receive from the company’s earnings.

Dividend is the share distributed from the annual net profit and free reserves in a joint stock company (Art. 509/2 TCC). Each shareholder has the right to participate in the net profit for the period decided to be distributed in proportion to his/her share (TCC Art. 507).

Advance dividend is an advance to be distributed to the shareholders over the interim profit. Joint stock companies may distribute dividends based on the balance sheet prepared at the end of the business year and, in any case, based on the decision of the general assembly regarding the acceptance of the balance sheet, profit and loss account and the distribution of the profit. Otherwise, any payment made to the shareholders, even if it is derived from the net profit, constitutes a “return of capital to the shareholders”, which is prohibited by mandatory provisions.

Keywords: Profit, Dividend, Dividend Right, Dividend Advance, Determination of Dividend, Legal Nature of Dividend,

INTRODUCTION
Joint stock companies are the basis of major investment functions in economies. Joint stock companies are the basis of large investment functions in societies within the modern economic system, especially in capitalist and

It is of great importance in mixed economies and is an indispensable means of production.

By bringing together small savings that are useless and idle on their own, it creates large capitals; by putting these capitals into the service of the economy, it paves the way for large investments and the realization of important projects.

creates . The limited liability of joint stock companies and the advantage of this advantage for shareholders

It allows large amounts of capital to be raised, as they only risk their participation shares. Small amounts of capital enable small savers to participate in large investments without the need for knowledge and experience.

The most important financial or asset right of a shareholder of a joint stock company, whether or not it is listed on the capital market, is the right to dividends, unless the company has to be liquidated.

is a right. Regular and high dividend distribution is an important right of joint stock companies from the point of view of savers.

that make them attractive. Joint stock companies will grow and develop as long as they fulfill these expectations.

The study examines the concepts of profit and dividend, the comparison of dividend with similar concepts, the legal nature of dividend, determination of dividend and advance dividend distribution, and the relevant sections of the draft TCC.

Dividends and Profit Distribution Principles in Joint Stock Companies
PROFIT CONCEPT
IN GENERAL
Profit is a word of Persian origin. The dictionary meaning of profit is the money gain provided by shopping business. The dictionary meaning of the word profit is; a good sold, a work done or

is the money obtained in return for an expended labor, dividend.

Only the word profit is not used in the legislation. Therefore, there is no unity of concept. The word “profit” is used in Articles 455-457 of the TCC, “profit” in Articles 466, 467 and 470 of the TCC, and “dividend” in Article 15 of the CML. However, despite these different usages

The words profit, gain and dividend are used synonymously.

For joint stock companies, profit is defined as the profit that is recognized in the liability statement of the balance sheet of the company in the event that the profit and loss account shows a profit balance as a result of the activities of the company within an accounting period and is distributed to the shareholders in accordance with the provisions of the law and the articles of association.

is an item allocated to the shareholder.

For the shareholder, profit refers to a cash gain to be added to his/her wealth or the income from his/her wealth allocated to share certificates.

The purpose of a joint stock company is to generate profit and distribute this profit among its shareholders. The profit provided by the company is not only an indicator of success, but also a necessity for the continuity of the company’s activities.

Since the concept of profit is a general concept, it is necessary to analyze this concept by dividing it into sub-branches and to mention the concepts of “commercial profit”, “financial profit”, “pure profit” and “distributable profit”.

COMMERCIAL PROFIT – FINANCIAL PROFIT
In order for a joint stock company to be able to distribute dividends, the company must first make a profit, that is, profit must appear in the commercial balance sheet of the company. However, although the financial balance sheet may show a profit, the commercial balance sheet may show less profit than the financial balance sheet or no profit. The reverse is also possible.

For example, a joint stock company that has a profit of TL 5000 according to its commercial balance sheet may appear to have a corporate income of TL 500 according to its financial balance sheet due to its non-taxable earnings. The reason for this is that these two balance sheets are prepared in accordance with different laws and the valuation of the financial balance sheet may be different in terms of non-deductible expenses, hidden reserves, depreciation and provisioning, tax provisions that may be different, or for economic and social purposes, some business income may be completely excluded from taxation or a reduction in earnings may be accepted.

Commercial profit is the profit arising from the commercial balance sheet prepared in accordance with commercial law and general accounting principles and standards.

Fiscal profit is the profit arising from the financial balance sheet prepared in accordance with the principles and rules of tax law. Fiscal profit is achieved by making some additions to and deductions from the commercial profit, in short, by utilizing the commercial profit.

Let’s express the difference between commercial profit and financial profit more concretely. In our tax legislation, certain expenses are not deductible. These expenses are called “legally unallowable expenses” (KKEG). In addition, some incomes are exempted from tax by the provisions in our tax legislation. Financial profit is calculated by adding non-deductible expenses to the commercial profit and subtracting the exempt income. Calculated fiscal

The profit becomes the tax base.

At this stage, the most important difference between commercial profit and financial profit is that some expenses that can be deducted in the determination of commercial profit are not legally accepted expenses for tax purposes and are not taken into account in the determination of financial profit.

Since profit distribution is based on the commercial balance sheet, if there is no profit in the commercial balance sheet, the company cannot distribute profit. The financial profit determined according to the financial balance sheet is neither the basis for profit distribution nor for setting aside reserves. This amount is only used to determine the amount subject to tax, in other words, to find the tax base.

PURE PROFIT
The TCC does not define the concept of net profit. However, it is stated in Article 466 of the TCC that the net profit constitutes the reserve fund and the base for profit distribution and is the profit to be decided to be distributed to the shareholders and other persons participating in the profit. In the draft TCC, the term “net profit for the period” is used instead of “net profit”.

Gross profit is the difference between the revenues and expenses of the company in an accounting period. In order to reach the net profit from the gross profit, prior year losses, taxes and similar items must be deducted from the gross profit.

DISTRIBUTABLE PROFIT
The amount remaining after the first appropriation of the legal reserves and the deduction of accumulated losses, if any, from the net profit shall constitute the distributable net profit. Distributable profit may include profits earned but not distributed in the relevant accounting period, reserves set aside for regular profit distribution, extraordinary reserves that are not allocated for a specific purpose, those that can be distributed from the discretionary reserves, and even the portion of the legal reserves exceeding half of the share capital.

CONCEPT OF DIVIDEND
The share (Aktie) constitutes the focal point of the law of joint stock companies and is a concept with both legal and technical characteristics. The legal characteristic of the concept of share is derived from the fact that the TCC uses the concept of “share” when defining the joint stock company (Art. 329 TCC) and also allocates the first section of the sixth chapter to “share” (Art. 476-479 TCC).

The right to dividends is the basic financial right of the shareholder. The concepts of dividend and dividend were first introduced in our legislation with the Communiqué Serial: 4, Communiqué No. 27. Accordingly, dividend refers to the share of the profit to be distributed to the shareholders of the joint stock company and other persons participating in the profit (members of the board of directors, employees, holders of usufruct shares, etc.), and dividend refers to the share distributed to the shareholders of the joint stock company from the profit.

Dividend is the share distributed from the annual net profit and free reserves (Art. 509/2 TCC). Each shareholder has the right to participate in the profit allocated for distribution to the shareholders in proportion to his/her share, in accordance with the provisions of the law and the articles of association (TCC Art. 507, f.1).

Although dividend is an investment income such as interest and rent, it should be noted that interest and dividend are very different concepts. The general assembly is authorized to decide whether and how much dividends will be distributed. However, the board of directors is authorized to propose dividend distribution.

When the concept of dividend is evaluated from an economic point of view, it is seen that it has different meanings especially for shareholders, creditors and the company. Indeed, especially for small shareholders, participation in the management activities of the company may not be very important. Generally, for these shareholders, the dividend they receive at the end of the year in return for their investments is important.

The general assembly and the board of directors are obliged to comply with certain conditions stipulated by law and the articles of association. (TCC Art. 507, f. 1) In this sense, the basic condition for the distribution of dividends is that the company has made a profit or that reserves have been set aside for this purpose from previous years’ profits (TCC Art. 509, f. 2).

In order to distribute profit in joint stock companies, certain conditions must be fulfilled. The criteria to be used in determining the distribution of dividends differ depending on whether the corporation is publicly traded or closed.

LEGAL NATURE OF DIVIDENDS
Legal Nature of the Share
In a joint stock company, the shareholding (share) arises with the registration of the company. A joint stock company acquires its legal personality and the title of joint stock company, which is dependent on the birth of its legal personality, upon registration (TCC.

137, 301. 1) \ before registration, the partnership in the ordinary company is transformed into a partnership in the joint stock company. As in the case of a nominal company that transforms into a joint stock company, the partnership in a joint stock company is a continuation of the partnership in a nominal company (Art. 152 TCC).
Since the shareholding in a joint stock company does not depend on a person, the owner of the share may be any real or legal person. In general, the obligation of the shareholder is the commitment and pledge of an amount of cash or in kind as capital, and the person has no role in the rights and obligations arising from the share. Therefore, it is possible to characterize the shareholding in a joint stock company as a “position” independent of the person of the shareholder. Whoever owns the share is the shareholder. However, by the articles of association, both at the time of incorporation and after registration, participation in the company and the acquisition of shares may be subject to special conditions such as being of Turkish nationality and being a farmer. The joint stock company is a multi-shareholder partnership type due to its economic purpose and legal structure. All laws have regulated the organization, management and supervisory rights of joint stock companies by taking this feature into consideration. However, since the existence of a minimum of five founders holding shares is required for the establishment of a joint stock company, there is no legal obstacle to the establishment of a joint stock company consisting solely of five shareholders (Art. 277 TCC).

The presence of three shareholders is sufficient for the board of directors, and the presence and vote of one shareholder is sufficient if the general assembly has been able to convene in accordance with the law or the articles of association.

These five shares may be equipped with various rights and divided into different types (Art. 389 TCC), or the articles of association may stipulate that the shares shall be registered shares and may not be transferred to others (Art. 416 TCC) or may be transferred with the consent of the general assembly or the board of directors, thus creating partnership relations similar to those of a sole proprietorship.

If the shareholding in a joint stock company is acquired during the establishment or increase of the capital, in the capacity of founder or participation contractor, the acquisition is deemed “original”, and if it is subsequently transferred from these persons, it is deemed “derivative”. In Turkish Commercial Law, the primary or derivative acquisition has significance only in terms of the payment of the balance of the subscribed capital. If the share was acquired during the incorporation of the joint stock company or during the increase of the capital, the transferor of the share may be held liable for the balance capital debt under certain conditions (Art. 419 TCC).

2.1. In a joint stock company, the shareholding is determined according to the number of shares into which the share capital is divided, each share corresponding to one shareholding (TCC Art. 269, 279). If the share capital is divided into 1000 shares of 500 liras, there are 1000 partnership positions in the company. However, the nominal value of the shares may differ from each other. Differences in nominal value alone cannot create a special category of shares.

Shares containing rights and obligations cannot be divided against the company as a whole (Art. 400 TCC). In other words, each share constitutes a unity. For example, it is not possible to divide a share of 1000 liras into two shares of five hundred liras each.

2.2 In a joint stock company, each share has a nominal value. This nominal value cannot be less than 500 liras (Art. 399 TCC). The nominal value of a share indicates the nominal value of the capital that the shareholder has committed or pledged. As a rule, the shareholder shall participate in the profits and, in the event of dissolution of the company, in the liquidation balance according to the ratio of this nominal value to the share capital. The nominal value of the share must be shown in Turkish Liras, as in the share capital.

In a joint stock company, each share has an independent existence. Even if several shares are collected in the hands of one person, the rights and obligations attached to the partnership are not merged; this person owns separate partnerships in proportion to the number of shares he owns, benefits from the rights arising from each share separately and is subject to the obligations.

In a joint stock company, shares are generally transferable. In order to facilitate the transfer and circulation of shares, the issuance of share certificates, which have the characteristics of negotiable instruments, is permitted, and even their issuance to “bearer” is allowed. (Art. 409 TCC.) Since the shareholders of a joint stock company are not entitled to exit and withdrawal rights, the possibility of transfer compensates for the deficiency of the exit and withdrawal institution. However, the articles of association may subject the transfer of shares to special conditions (Art. 416 TCC).

In principle, each share in a joint stock company has the same rights and is subject to the same obligations. Each share grants the same rights and imposes the same obligations on each shareholder.

In general, each share is entitled to one vote, has the same nominal value, and participates in the profits and liquidation balance according to the ratio of its nominal value to the share capital 25. However, this equality exists for shares of the same type. The articles of association may grant privileged rights to certain types of shares in terms of profits, liquidation shares in the event of dissolution of the company and other matters (TCC Art. 401).

Acquired Right
In the law of joint stock companies, the issue of whether the rights attached to the shareholding title may be subject to change by the company has been emphasized. This is because accepting that all of the rights granted to the shareholders, without exception, may be limited or eliminated by the majority decision may lead to unfavorable consequences for the shareholders and may cause them not to obtain the benefits they expect from the partnership.

Not all vested rights have the same quality and strength. For these reasons, vested rights can be evaluated in two groups.

Rights that cannot be changed without the consent of the shareholder, that are not bound by the decisions of the general assembly and the board of directors, and that have absolute power against these decisions are called absolute vested rights. The right arising from the necessity for the joint stock company to follow the purpose of earning and distributing profits is of this nature. In this respect, the right to dividend is an inalienable and irrevocable right. Absolute vested rights (absolut wohlerworbenen) cannot be eliminated or limited without the consent of the shareholder.

Absolute vested rights can also be characterized as a veto right granted to the shareholder and even a single shareholder can prevent the adoption of a resolution that changes the vested right.

Relative vested rights, on the other hand, are rights that are protected only in essence, whereas their scope may be limited due to the interests of the joint stock company. In this sense, the right to dividend is the right of the shareholder to participate in the annual profit allocated for distribution or the reserves allocated for distribution in accordance with the provisions of the law and the articles of association. In this sense, the right to dividends is a relative vested right. These rights may be limited, provided that certain rules, conditions and measures are observed. The scope of the possibility to limit the relative acquisitive rights determines whether the right is strong or weak. Another source of accrued rights in corporate law is the articles of association. By the articles of association, rights that are not among the statutory accrued rights and that are doubtful to be of this nature may be made accrued rights, provided that they do not contradict the mandatory provisions, or relative accrued rights may be elevated to the level of absolute rights, and weak accrued rights may be elevated to the level of strong accrued rights, or rights based on the shareholding relationship, which are not stipulated by the law, may be granted to the shareholders, or they may be granted accrued rights.

According to Meier Hayazi Forstmoser, the most important difference between absolute and relative acquisitive rights is that absolute acquisitive rights concern the interests of third parties and creditors of the partnership in addition to the shareholders, whereas relative acquisitive rights concern only the interests of the shareholders.

Nature of Contingent Claims
In order for the dividend right to be transformed into a right of receivable, the general assembly must decide on dividend distribution. Only after such a decision, the dividend right becomes a right of receivable that can be asserted against the joint stock company.

In order for the dividend right to be transformed into a right of receivable, it is not sufficient for the general assembly to approve the balance sheet; in particular, it is necessary for the general assembly to take a decision on dividend distribution. The condition to be specified here is that the general assembly takes a decision on dividend distribution. Therefore, there is a contingent receivable in dividends.

DETERMINATION OF DIVIDEND
DETERMINATION OF DIVIDENDS IN PUBLICLY TRADED JOINT STOCK COMPANIES
In General

It is not necessary to indicate in the articles of association how the profit will be distributed to the shareholders. However

Article 279/2 b.5 of the TCC stipulates that the special benefits to be provided to the founders, members of the board of directors and other persons from the company’s profits must be specified in the articles of association. Article 401 of the TCC stipulates that privileged shares in profits and in case of liquidation may only be granted by the articles of association (Article 478 of the Draft TCC stipulates that privileges may be granted to certain shares by amending the initial articles of association or the articles of association).

Under Article 385 of the TCC, dividends are considered among the vested rights of the shareholder. According to this article, vested rights are rights that are not subject to the decisions of the company’s board of directors or general assembly.

The legislator has introduced a general framework for dividend distribution; however, if special benefits are to be provided to certain persons, this situation should be indicated in the articles of association in order to protect those who will become shareholders later on. Apart from this, the general assembly of the joint stock company is free to make different arrangements. The TCC is based only on the concept of “share” as a measure for profit distribution in joint stock companies.

The board of directors shall prepare a balance sheet and income statement for the previous year within 3 months following the end of the accounting period. In addition, a report containing a summary of the commercial, financial and economic situation of the company and the works carried out and the wishes for the future shall be prepared. The Board of Directors shall call the General Assembly for a meeting within 3 months following the closing of the accounting period, at least two weeks before the announcement and meeting date, in the manner specified in the Articles of Association and by making an announcement in the Trade Registry Gazette. The General Assembly shall then approve the balance sheet, income statement and the proposal for the distribution of the profit, either as is or with amendments. Thus, the profit will be ready for distribution.

Determination of Annual Profit with the Business Year Balance Sheet
As stated in Article 457/1 of the TCC, the determination of the annual profit of the company shall be made according to the annual balance sheet. This provision has led to different evaluations in the doctrine. Doğanay and Arslanlı have stated that this provision does not allow the distribution of dividends based on a balance sheet with a period shorter than one year (e.g. interim balance sheet).

Birsel, Bilgin and Tekinalp, on the other hand, argue that Article 364/2 of the TCC contains the expression “joint stock companies that distribute dividends several times a year” and that the term “year” in Article 457 of the TCC refers to a business year, and that, in this case, a joint stock company may distribute dividends twice a year by accepting the six-month business basis within a calendar year.

Balance sheets are provisional until the decision of the general assembly. In this respect, they are not valid until the approval of the general assembly. In a joint stock company, dividends cannot be demanded unless there is a balance sheet and a resolution of the general assembly approving it.

Items that must and may be deducted from the profit of the period for the determination of the profit to be distributed
Mandatory Download Items
Previous year’s loss Taxes and the like Legal and voluntary reserves and other assets required to be set aside in accordance with the law and articles of association Hidden reserves.

DETERMINATION OF DIVIDENDS IN PUBLIC JOINT STOCK COMPANIES
In General

The primary purpose of incorporation of joint stock companies is to generate profit and distribute this profit to the shareholders. However, in joint stock companies within the scope of the TCC, the right of shareholders to receive dividends is restricted by various provisions, as analyzed above. The most explicit provision indicating this situation is Article 469 of the TCC. Pursuant to Article 469 of the TCC, dividends rank fourth after legal and voluntary reserves, other assets required to be set aside by law and the articles of association (e.g. severance pay, notice pay, funds, other provisions (Art. 44 465/2 of the TCC), employee and personnel bonuses).

According to the TCC and the CMB, not only the shareholders who contributed capital to the company, but also the members of the board of directors, officers, employees and employees are entitled to share in the profit of the company by the provisions of the articles of association or by the decision of the general assembly.

The general assembly has also been granted very broad powers regarding profit distribution. In addition, based on the possibility to set aside unlimited open or hidden reserves, most companies have chosen not to distribute any or sufficient profit under the TCC.

In addition, the TCC imposes limitations on majority decisions that would take away one of the most fundamental rights of shareholders, which is the right to dividends.

Dividend Distribution Principles
The CMB issued Communiqué Serial: 4, No: 27 on the basis of Articles 14/A and 15 of the Capital Markets Law No. 2499 as amended by Law No. 4487. With the Communiqué Serial: 4, No: 27, issued on the basis of Articles 14/A and 15 of the Capital Markets Law No: 2499 amended by Law No: 4487 and published in the Official Gazette dated 13.11.2001 and numbered 24586, the CMB regulated the principles to be complied with in the distribution of dividends and dividend advances by the IPOs and repealed Article 7 titled “First Dividend Rate and Dividend Payments” of the Communiqué Serial: 4, No: 1, which was still in force with this Communiqué.

In Articles 4 and 5 of Communiqué Serial: 4, No: 27, dividend distribution principles are specified by making a distinction between listed and unlisted companies. It is stated that the purpose of this distinction is to encourage self-financing in listed companies. It is aimed to encourage other companies to be traded on the stock exchange with the rights granted to listed companies in dividend distribution.

Another different aspect of dividend distribution principles in public joint stock companies is regulated under Article 19/3 of the CML. The relevant provision reads as follows “In public joint stock companies, dividends shall be distributed equally to all shares existing as of the date of distribution, regardless of their issue and acquisition dates”.

Dividend Distribution in Joint Stock Companies whose shares are not traded on the Stock Exchange
The amount of the first dividend to be distributed by the unlisted IPASs shall not be less than 20% of the distributable profit remaining after deducting the reserves required to be set aside according to the law, tax, fund and financial payments and prior year losses, if any, from the profit for the accounting period.

It is essential that the first dividend is distributed in cash to the companies whose shares are not traded on the stock exchange. However, these companies are required to distribute the first dividend in cash in accordance with Serial: 4, No: 9, Issue No: 9 published in the Official Gazette dated 27.11.1994 and numbered 22154: 4, No: 9 published in the Official Gazette dated 27.11.1994 and numbered 22154, those that do not fall within the scope of the independent audit exemption stated in subparagraph (a) of Article 3 of the Communiqué on Principles Regarding Exemption Conditions of Issuers and Their Removal from the Board’s Register may distribute the first dividend in cash and/or in the form of shares.

The principles of dividend distribution of publicly traded joint stock companies were determined by the Board Decision dated January 27, 2010 and numbered 02/51 and announced to the public through the Board’s Weekly Bulletin dated January 25, 2010 – January 29, 2010 and numbered 2010/4. With the aforementioned Board Decision, no minimum profit distribution obligation is imposed for public joint stock companies whose shares are traded on the Stock Exchange and the profit distribution of these companies is subject to the Communiqué Serial: IV, No: 27 and the provisions of the articles of association of these companies. With the same Decision, it was decided that the profit distribution of public joint stock companies whose shares are not traded on the Stock Exchange shall be made in accordance with Communiqué Serial: IV, No: 27 and the provisions of their articles of association. The amount of first dividend to be distributed by public joint stock companies whose shares are traded on the stock exchange cannot be less than 20% of the distributable profit remaining after deducting the legal reserves, tax, fund and financial payments and prior year losses, if any, from the profit for the accounting period.

The most common form of dividend payment made by companies to their shareholders is cash dividend payments. Since this method requires cash outflow from the company, the liquidity status of the company is decisive for the application of this method.

Joint stock companies whose shares are traded on the stock exchange may pay dividends in cash, subject to the decision of their general assemblies,

Full cash redistribution,

Don’t distribute it entirely in shares,

It is free to distribute a certain percentage in cash and a certain percentage in shares and leave the remainder within the Company. However, unless and until the required reserves are set aside and the dividend determined for the shareholders in the articles of association is set aside, no decision may be made to set aside other reserves, to carry forward profits to the following year or to distribute dividends to the holders of usufruct shares, members of the board of directors and employees of the Company. There are various reasons why dividend payments are made in the form of stocks instead of cash. These are the high prices of company shares, the demand to increase the number of company shares and company shareholders in the market, and the demand to liquidate company shares. In addition, the payment of dividends through the distribution of shares provides the advantage of eliminating the contradiction between keeping the profit within the company and distributing it, since it allows profit distribution without the outflow of funds from the company.

The proposal of the Company’s Board of Directors to the General Assembly on whether or not to distribute dividends and, if so, the rate of dividend distribution shall be disclosed to the public prior to the announcement of the new share purchase circular through the Stock Exchange Daily Bulletin in accordance with the principles set forth in the Communiqué Serial: 8, No: 20 on the Principles of Public Disclosure of Material Events published in the Official Gazette dated 06.07.1993 and numbered 21629. In the event that the General Assembly of the Company decides not to distribute the first dividend, this amount shall be added to the extraordinary reserves after it is calculated and set aside.

Dividend Distribution Time
Dividend distribution must be completed by the shareholders by the end of the fifth month following the accounting period. For the dividend payment to be completed;

If the entire dividend is to be distributed in cash, payment in cash or on account to the shareholders who apply to the dividend distribution addresses with the relevant coupons to collect the dividend,

If the dividend is to be distributed in shares, the share certificates to be issued due to the addition of the dividend to the capital shall be registered by the CMB and the share certificates to be distributed in return for the dividend shall be made ready for delivery to the shareholders who apply to the addresses where the dividend is distributed by completing the post-registration procedures;

In partnerships with registered capital system, making them ready for delivery to the shareholders who apply to the addresses where the share certificates are distributed until the end of the fifth month following the accounting period,

For companies under the capital system, the registration of the capital increase must be completed and made ready for delivery by the end of the fifth month following the accounting period,

If the options in the first and second subparagraphs are used together, the transactions specified in the aforementioned subparagraphs must be fulfilled separately but until the end of the fifth month following the accounting period. Therefore, dividend distribution must be completed as of the last day of the fifth month.

If the dividend is not demanded from the company within 5 years after it reaches the stage where it can be paid, it shall be time-barred in favor of the company (BK. MD. 126).

Privilege in Dividend Distribution
A privilege in dividend distribution may be recognized for the portion of the distributable profit after the first dividend is distributed. The holders of CSDs, together with other shareholders, receive dividends out of the profit remaining after the first dividend is distributed in proportion to their shares, in the ratio of the first dividend per share as specified in the articles of association in relation to the privilege of these securities. The most important of the methods of granting privileges in dividends is the right of priority. This importance manifests itself in the event that there is not enough profit to be distributed to all shareholders. In case there is sufficient profit, priority is not of great importance. Two conditions are required for joint stock companies to distribute advance dividends. One of these conditions is the existence of a profit according to the three, six or nine-month interim financial statements prepared in the accounting period in which the advance dividend is to be distributed, and the other condition is the adoption of a resolution by the general assembly of the company to distribute advance dividends (Communiqué, Art. 5). If both of these conditions are met, advance dividends may be distributed.

Tekinalp initially argued that a privilege can only be created by granting a superior right to a share, and that if the share capital is divided into groups and each group is granted more rights than those granted by the law, but the equality between the shares is not disturbed, no privilege can be mentioned. As a matter of fact, based on this argument, the author rejected the existence of a privilege if, for example, the shares are divided into more than one group and four voting rights are granted to each group, if the equality between the shares is not disturbed and superiority is not ensured, then only in the case of granting more than 1 voting right than the 1 voting right granted by the law.

However, in a communiqué presented in 1996, the author changed his above-mentioned opinion and stated that since Article 401 of the TCC states that only certain shares may be granted privileges, whereas the element of “difference” is not included, a privilege may arise if one share group has different rights compared to the other share group, and a privilege may also arise if the shares are granted rights above the provisions of the law (such as granting 4 voting rights to the shares).

DIVIDEND ADVANCE DISTRIBUTION PRINCIPLES
Advance is a word of French origin. The dictionary meaning of advance is an advance payment made in advance against a future receivable. Serial: 4, No: 27 is as follows; it is the advance to be distributed to the shareholders over the interim profit.

It should be noted that, although the Legislature has paved the way for closed joint stock companies to benefit from the advance dividend, it has not introduced any rules regarding the advance dividend in the TCC, and has deemed it appropriate to regulate the application rules of the advance dividend by a communiqué to be issued by the Ministry of Customs and Trade for closed joint stock companies (TCC, Art. 509/f.3).

Calculation of the Dividend Advance to be Distributed

The advance dividend to be distributed may not exceed half of the amount remaining after deducting the reserves required to be set aside in accordance with the laws and articles of association, tax, fund and financial provisions and all previous years’ losses, if any, from the interim profit. Unrealized capital gains (value increases) are not taken into account in the calculation of interim profit of investment trusts. In the event that there is profit in subsequent interim periods within the same accounting period, the amount of advance dividend to be distributed is calculated by deducting the amounts of advance dividend paid in the previous interim period or periods in addition to the above-mentioned. The advance dividend to be paid cannot exceed half of the amount calculated in this way (Communiqué, Art.7/2).

Advance Dividend Payments
Advance dividend shall be distributed to all existing shares as of the date of distribution, regardless of their issue and acquisition dates. However, the situation specified in the third paragraph of this article is reserved. Shares issued by the companies under the share capital system shall be entitled to advance dividend as of the accounting period in which the capital increase is registered, and shares issued by the companies under the registered capital system shall be entitled to advance dividend as of the accounting period in which the circular regarding the right to purchase new shares is published.

Advance dividend shall be paid to privileged shares from the profit without taking privilege into consideration. Advance dividend cannot be paid to holders of usufruct certificates, members of the board of directors who are not shareholders, and other persons who participate in the profit other than shareholders (Communiqué, Art. 8/2).

Liability for Advance Dividend Distribution
Ser. According to the preamble of the Law No. 4487 amending the Capital Markets Law, special liability principles have been regulated in the article in order to eliminate the problem of how the advance will be closed if the companies that distribute dividend advances incur losses at the end of the accounting period.

Ser. Pursuant to Article 15/4 of the CML, the liability is related to the damages that may arise in the event that the interim balance sheets and income statements do not reflect the truth or are not prepared in accordance with the legislation and accounting principles and rules. The members of the board of directors and the legal entities they represent, company auditors, independent auditors and the real and legal entities they are affiliated with are directly and severally liable to the injured parties for the aforementioned acts.

In the event that the general assembly decides to distribute advance dividends and there is a profit according to the interim financial statements, the board of directors of the joint stock company shall fulfill the following duties respectively (Communiqué, Art. 9/1):

A report on the distribution of advance dividend shall be prepared, and in this report;

It shall be stated that the interim financial statements forming the basis for the advance dividend distribution have been prepared in accordance with the principle of fair presentation set forth in Article 515 of the TCC, and that the amount of advance dividend to be distributed has been calculated in accordance with Article 7 of the Communiqué on Advance Dividend Distribution. The documents constituting the basis for the calculations and fulfillment of other conditions shall be attached to this report.

A decision is taken regarding the payment of the advance dividend amounts determined in the report to the shareholders and the method of making such payments. Advance dividend amounts shall be paid to the shareholders within 6 weeks at the latest following the decision.

CONCLUSION
As a result, the right to dividend is a fundamental financial right of the shareholder. The concepts of dividend and dividend were defined for the first time in our legislation by the Communiqué Serial: 4, Communiqué No. 27. Accordingly, dividend refers to the share of the profit to be distributed to the shareholders of the joint stock company and other persons participating in the profit (members of the board of directors, employees, holders of usufruct shares, etc.), and dividend refers to the share distributed to the shareholders of the joint stock company from the profit.

When we examine the legal nature of the right to dividend in joint stock companies, the partnership (share) in a joint stock company arises with the registration of the company. As a joint stock company acquires its legal personality and the title of joint stock company, which is dependent on the birth of the legal personality, with the registration, the partnership in the joint stock company is transformed into a partnership in the joint stock company before the registration. As in the case of a joint stock company, the partnership in a joint stock company is a continuation of the partnership in a joint stock company.

With regard to the determination of the right to dividends, according to the TCC and the CMB, not only the shareholders who have contributed capital, but also the members of the board of directors, officers, employees and employees are entitled to share in the profits of the company by the provisions of the articles of association or by the decision of the general assembly.

According to the status of the shares, there are two types of companies and distribution methods for determining the dividend rights of joint stock companies. The amount of the first dividend to be distributed by unlisted joint stock companies cannot be less than 20% of the distributable profit remaining after deducting the legal reserves, taxes, funds and financial payments and previous years’ losses, if any, from the profit for the accounting period. The amount of first dividend to be distributed by joint stock companies whose shares are traded on the stock exchange cannot be less than 20% of the distributable profit remaining after deducting the legal reserves, tax, fund and financial payments and prior year losses, if any, from the profit for the accounting period.

Finally, dividend distribution, which is subject to a specific time limit, must be completed by the shareholders by the end of the fifth month following the accounting period.

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