What can you do if you disagree with a fellow shareholder?

Shareholder Disputes and Exit Options in Turkey

You may be unable to access the company’s accounts, participate in important decisions or agree with another shareholder on the company’s future. If you wish to leave the company, further questions may arise: who will buy your shares, how will their value be determined, and when will you receive payment?

Finding a solution starts with identifying the outcome you wish to achieve. Obtaining information and remaining a shareholder, resolving management problems, seeking another shareholder’s exclusion, and leaving in return for the value of your shares are different objectives. Based on the Turkish Commercial Code No. 6102 (“TCC”), this guide examines shareholder disputes in Turkish joint stock and limited liability companies, the rights available to shareholders and the financial implications of these options.

Table of contents

• Which documents should you review first in a shareholder dispute?
• What can you do if the company’s accounts and records are withheld?
• How should a deadlock in a 50/50 shareholding structure be addressed?
• How can minority shareholders participate in decision-making?
• How can general assembly resolutions be challenged?
• What can you do if the company is profitable but does not pay dividends?
• What can you do if company resources are used for another shareholder’s benefit?
• How can you exit the company by selling your shares?
• What options are available for withdrawal from a limited liability company?
• Can you seek dissolution of a limited liability company for just cause
• What exit options are available to a shareholder in a joint stock company?
• Can the other shareholder be excluded from the company?
• How is the value of your shares determined when you leave?
• When is the statutory exit payment payable?
• What protective measures are available while the dispute continues?
• Does an arbitration clause in the shareholders’ agreement change the route?
• Can you agree on an exit or a way to continue without litigation?
• Conclusion

Which documents should you review first in a shareholder dispute?

Start by reviewing the articles of association governing the company’s formation and operation, current records of shareholdings and representation authority, general assembly resolutions and any shareholders’ agreement. In Turkish statutory terminology, the articles of association are called “esas sözleşme” for a joint stock company and “şirket sözleşmesi” for a limited liability company. A shareholders’ agreement may contain additional commitments concerning information sharing, approval of certain transactions, share transfers and exit arrangements. It is important to assess both who is bound by those commitments and how they relate to corporate resolutions.

Next, set out the dispute in chronological order. Which documents did you request, which proposed resolution did you oppose, and what response did you receive? For example, if you believe that access to financial information has been withheld, bringing together the relevant accounting period, the documents requested and the responses received will help identify the appropriate course of action. The initial review should also cover application deadlines, ongoing transactions and contractual dispute resolution provisions.

Further information on the scope of agreed information-sharing, share transfer and exit arrangements is available in our article on Shareholders’ Agreements under Turkish Law.

What can you do if the company’s accounts and records are withheld?

In a limited liability company, each shareholder may request information from the managers about all of the company’s affairs and accounts and may inspect specific matters. If access is restricted because of a risk that the information may be used to the company’s detriment, the matter may be referred to the general assembly. If the general assembly also unjustifiably prevents access to information or inspection, an application may be made to the court. The scope of the request, the response received and the general assembly stage should therefore be documented. 

In a joint stock company, the financial documents to be made available before the general assembly and the right to obtain information at the meeting should be considered together. A shareholder may request explanations from the board of directors about the company’s affairs and from the auditors about the conduct and results of the audit. If the request is refused, an application may be made to the court within ten days following the refusal. If the request is left unanswered or deferred, the law provides for an application after a reasonable period. The timetable should be determined according to the circumstances encountered. 

The protection of information and inspection rights against their removal by corporate resolution is distinct from the procedure for exercising those rights. In a joint stock company, inspection of the parts of the commercial books and correspondence relevant to the question requires express permission from the general assembly or a board resolution. The request should therefore specify the documents sought and the matter to which they relate, and the appropriate application procedure should be followed. 

For example, when questioning payments to a business connected with another shareholder, you can focus your request on the relevant contracts, invoices and reasons for the payments. A special audit may also be considered to clarify particular events through an expert examination. In a joint stock company, a shareholder may request a special audit from the general assembly even if the matter is not on the agenda, provided that the audit is necessary for the exercise of shareholder rights and the right to information or inspection has already been exercised. If the general assembly approves the request, the company or any shareholder may, within thirty days, apply to the commercial court of first instance at the company’s registered office for the appointment of a special auditor.  

If the general assembly refuses the request, shareholders representing at least 10% of the capital, or 5% in a publicly held joint stock company, or shareholders whose shares have an aggregate nominal value of at least TRY 1,000,000 may apply to the court within three months for the appointment of a special auditor. This amount refers to the shares’ nominal capital value, not their market value, and provides an alternative eligibility threshold to the percentage requirement. 

Following a refusal by the general assembly, satisfying the percentage or nominal-value threshold alone is not sufficient. The applicants must make a convincing case that the founders or corporate bodies have breached the law or the articles of association and thereby caused loss to the company or its shareholders. The application should therefore identify the events to be examined and the documents supporting them. These special-audit provisions also apply to limited liability companies. 

How should a deadlock in a 50/50 shareholding structure be addressed?

In an equally owned company, the search for a solution should begin by identifying which decision cannot be taken and why. The problem may be confined to the approval of a new investment; an inability to appoint the company’s management or maintain day-to-day operations may require a different response. In addition to shareholding percentages, the quorum and voting requirements of the relevant corporate body should be examined.

Decision-making rules for the management body differ according to company type. If votes are tied on the board of a joint stock company, the matter is deferred to the next meeting; if the tie persists at the second meeting, the proposal is deemed rejected. Where a limited liability company has more than one manager, decisions are taken by majority and, unless the articles of association provide otherwise, the chair has a casting vote in the event of a tie. This distinction concerns management bodies, not general assembly resolutions. It is therefore necessary to identify which body is responsible for the decision rather than relying solely on the shareholders’ ownership percentages. 

If the shareholders’ agreement provides for escalation to senior representatives, an independent expert assessment or a share purchase mechanism in the event of deadlock, the conditions for using that mechanism should be reviewed. If no such arrangement exists, the parties may negotiate an interim management arrangement or a share transfer. Where a court remedy is required, minutes recording the failure to reach decisions, disrupted payments and the effects on the company’s operations can help substantiate the claim chosen.

The prolonged absence of a legally required corporate body or an inability to convene the general assembly is different from the rejection of a particular proposal at a meeting. If a limited liability company has such structural deficiencies, a shareholder or creditor may seek its dissolution. The court first hears the managers and allows the company time to bring its affairs into compliance with the law; if the problem is not remedied, it may order dissolution. 

How can minority shareholders participate in decision-making?

In a joint stock company, shareholders representing at least 10% of the capital, or 5% in a publicly held company, may request that a general assembly be convened or that an item be added to its agenda, specifying their reasons and the proposed agenda. The articles of association may set a lower threshold. The request must be made through a notary, and the applicable timing requirements for adding agenda items must be observed. 

If the request is refused or no favourable response is received within seven business days, the requesting shareholders may apply to the court. The role of any court-appointed representative designated to arrange the meeting is to prepare the agenda and convene the general assembly; this is distinct from taking over management of the company. The rules on convening meetings and minority agenda rights also apply by analogy to limited liability companies. 

Capital increases should also be monitored closely. For example, if you hold 20% of the shares and the company doubles its capital without your participation, your percentage may fall to 10%, all other circumstances remaining unchanged. The pre-emption right to subscribe for new shares in proportion to your existing holding is therefore important. 

In a joint stock company, a general assembly resolution restricting or excluding pre-emption rights requires just cause and affirmative votes representing at least 60% of the capital. A resolution of an authorised board of directors under the registered capital system is assessed under its own rules; the 60% requirement does not apply to the board. Just cause is also required in a limited liability company. The relevant resolution must secure both at least two-thirds of the votes represented and an absolute majority of the total capital carrying voting rights. In a limited liability company, at least fifteen days must be allowed for the exercise of the right. Monitoring the capital increase resolution and the time allowed is important for protecting your ownership percentage. 

How can general assembly resolutions be challenged?

An action for annulment may be considered where a general assembly resolution breaches the law, the company’s articles of association or the principle of good faith. As a rule, a shareholder attending the meeting must vote against the resolution and have their objection recorded in the minutes. The conditions for bringing a claim require separate consideration where, for example, the meeting was improperly convened or participation was wrongfully prevented. The minutes, attendance list and convening documents should be retained together. 

As a rule, an annulment action must be brought within three months of the resolution date. Because expiry may result in the loss of the right to bring the action, preparations should continue even while negotiations with the other shareholder are ongoing. 

Serious defects, such as resolutions removing non-waivable shareholder rights, may give rise to nullity, meaning that the resolution is invalid from the outset. Invoking nullity is not subject to the three-month annulment deadline, although the requirements of a legal interest and the limits on abuse of rights must be observed. The appropriate remedy is determined by the specific content of the resolution. 

The remedy available against a board resolution also depends on its subject matter. A declaration of nullity may be sought for certain resolutions, while an annulment action is available where the law specifically provides for it. For example, the relevant capital increase resolutions under the registered capital system are subject to a one-month annulment deadline from publication. When faced with a capital increase, the first points to check are which body adopted the resolution and which deadline applies. 

What can you do if the company is profitable but does not pay dividends?

A dividend claim requires examination of the company’s distributable profit, the reserves that must be allocated and the general assembly’s resolution on the use of profits. Investment and financing needs may play a role in a decision to retain profits in the company. The profit distribution resolution and its reasons should therefore be requested together with the financial statements. 

In a limited liability company, a decision may be taken to allocate reserves not provided for, or exceeding those provided for, by law or the articles of association where this is necessary to cover losses. Where the reason is investment for the company’s development, the investment need must be substantiated, the interests of all shareholders must justify it, and these matters must be expressly set out in the articles of association. These requirements apply together. As the conditions differ between the two situations, it is necessary to check the stated reason for allocating additional reserves and whether its requirements are met. 

For example, if profits have not been distributed for a long time while substantial payments are made to the shareholder involved in management or to connected businesses, the reasons for retaining profits and the basis for those payments should be examined together. Depending on the findings, requests for information, challenges to general assembly resolutions or management liability claims may be considered.

Recovery of a dividend that has become payable under a distribution resolution is a separate payment claim. Such a claim is subject to a five-year limitation period running from the date on which payment becomes due. Since different time limits apply to management liability claims, the nature of the claim should be identified first. 

What can you do if company resources are used for another shareholder’s benefit?

If company resources are suspected of being used for personal purposes, or payments to a connected business appear inconsistent with market terms, the relevant contracts, invoices, payment records and management resolutions should be reviewed. This examination helps establish both whether loss has occurred and who may be liable.

Where the company has suffered loss, a shareholder may seek damages from members of management who meet the conditions for liability; in proceedings to recover the company’s loss, payment is made to the company. A loss suffered directly in the shareholder’s own assets is addressed separately. The claim should therefore be framed according to who has sustained the loss. 

Liability claims are subject to limitation periods of two years from knowledge of the loss and the person responsible and, in any event, five years from the act causing the loss. If the act constitutes a criminal offence subject to a longer criminal limitation period, that period also applies to the damages claim. If a resolution granting a release from liability has been adopted, it is also necessary to check whether the right to bring proceedings survives for the matters covered and whether the six-month period running from the release applies to the shareholders concerned. 

Where an ongoing problem arises from management, a shareholder in a limited liability company may ask the court, for just cause, to revoke or restrict a manager’s management and representation powers. Removal from management does not end share ownership; the solution concerning the shareholding must be planned separately. If the documents reviewed give rise to suspicion of an offence, a separate criminal-law assessment may be required.

How can you exit the company by selling your shares?

A transfer of shares to the other shareholder or an investor is one possible negotiated exit. Before discussions begin, transfer restrictions, priority purchase rights, required approvals and contractual notices should be identified. Price negotiations and completion of the transfer can then be managed within the same plan.

In a limited liability company, the transfer agreement must be in writing and the parties’ signatures must be certified by a notary. Unless the articles of association provide otherwise, general assembly approval is also required; in that case, the transfer takes effect upon approval. The share register and trade registry records must also be addressed when completing the transaction. 

Unless the articles of association provide otherwise, the general assembly may refuse approval without giving reasons. However, approval is deemed granted if no refusal resolution is adopted within three months of the application to the company for approval of the share transfer. If the articles prohibit transfer or approval is refused, the shareholder’s right to seek withdrawal for just cause is reserved. This preserves the right under Article 638 of the TCC rather than creating a separate exit mechanism. The approval process should be documented, and the conditions for a withdrawal claim should be assessed on the facts of the case. 

In a joint stock company, the procedure depends on the type of shares and any share certificates issued. For registered shares in particular, whether the capital contribution has been paid and any transfer restrictions in the articles of association are important. The transfer documents and required steps should be prepared according to the characteristics of the shares concerned. 

What options are available for withdrawal from a limited liability company?

The articles of association of a limited liability company may grant a right of withdrawal, either subject to specified conditions or without such conditions. Where such a provision exists, the notice required, the documents to be submitted and the financial terms of withdrawal should first be assessed under that provision. 

In addition, every shareholder may bring an action for withdrawal for just cause. This statutory remedy may be considered even if the articles of association contain no withdrawal provision. The claim should identify the facts said to make continuation of the shareholder relationship unacceptable. 

For example, if repeated obstruction of information requests or use of company resources for a particular shareholder’s benefit is alleged, the claim should explain which requests were refused and when, which transactions took place and how they affected the shareholder relationship. The court assesses just cause in the light of all the facts and evidence. This remedy should be considered in relation to the objective of a person seeking to end their own shareholding.

Can you seek dissolution of a limited liability company for just cause?

A shareholder in a limited liability company may also seek dissolution of the company for just cause. This right is available to every shareholder. Particularly where the dispute persistently affects the company’s operations, the shareholder’s personal withdrawal and the dissolution of the company should be assessed as separate claims. 

The court may order a solution other than dissolution. The law expressly permits the claimant shareholder’s exclusion in return for payment of the actual value of their shares, or another solution that is appropriate and acceptable in the circumstances. Proceedings initiated with a dissolution claim may therefore result in the company continuing while the claimant leaves. 

A withdrawal claim under Article 638 of the TCC seeks the shareholder’s departure, whereas a dissolution claim under Article 636 seeks to end the company. This difference matters to a person wishing to continue the business and secure the other shareholder’s exclusion. The claim should be chosen by considering whose shareholding is intended to end and the financial consequences, not merely the ease of commencing proceedings. 

What exit options are available to a shareholder in a joint stock company?

In a joint stock company, an exit plan can initially be based on a share transfer and any applicable contractual exit rights. The general action for withdrawal for just cause available in limited liability companies has no direct equivalent in joint stock companies, so the options specific to the company type must be examined. 

Where just cause exists, shareholders representing at least 10% of the capital, or 5% in a publicly held company, may seek dissolution. Instead of dissolving the company, the court may order the claimants’ exclusion in return for payment of the actual value of their shares as at the date closest to the judgment, or another appropriate solution. 

The important distinction is that the shareholders whose departure may be ordered against payment are the claimant shareholders. A dissolution action should therefore not be treated as a general means of securing the exclusion of the other shareholder with whom the dispute has arisen. When preparing proceedings, solutions that allow the company to continue and the ability to fund the exit payment should also be assessed.

Can the other shareholder be excluded from the company?

The articles of association of a limited liability company may specify grounds for exclusion by general assembly resolution. The applicable voting threshold and rules on voting eligibility should be reviewed for such a resolution. Adding grounds for exclusion to the articles of association at a later stage requires the unanimous agreement of all shareholders. A shareholder facing an exclusion resolution should note the three-month annulment period from notification of the resolution through a notary. 

Separately, Article 640(3) of the TCC provides for court-ordered exclusion for just cause at the company’s request. Preparing such a claim requires consideration of how the company’s decision to proceed is formed and how it will be represented in the litigation. For limited liability companies with two shareholders, the Constitutional Court judgment discussed below must also be taken into account. 

In a joint stock company, there is no general exclusion mechanism based solely on a shareholder dispute. For example, where a shareholder fails to pay a capital contribution on time, forfeiture of the rights attached to the relevant shares may be possible if the statutory notice and time-limit requirements are met. This special procedure is based on a ground distinct from disagreement between shareholders and concerns the shares for which the capital contribution remains unpaid. Valid commitments to transfer shares and other specific statutory remedies must likewise be assessed under their own conditions. 

What did the Constitutional Court change for limited liability companies with two shareholders?

In its judgment of 25 December 2025, case no. E.2025/128, decision no. K.2025/273, the Turkish Constitutional Court (Anayasa Mahkemesi, “AYM”) annulled Article 616(1)(h) of the TCC and the wording in Article 621(1)(h) concerning court applications for exclusion for just cause, in respect of limited liability companies with two shareholders. The judgment was published in the Official Gazette of 17 March 2026, No. 33199. As its effect was not deferred, the annulment took effect on that date.

The scope is not confined to companies owned 50/50. The annulment concerns the general assembly resolution and enhanced voting requirements previously prescribed for bringing an exclusion action in a two-shareholder company. The part of the same provision concerning exclusion by the general assembly on grounds set out in the articles of association, and Article 640(3), which requires a request by the company, were not annulled. The Court found that the inability to use the exclusion mechanism in two-shareholder companies was incompatible with the requirement to provide an effective remedy to protect freedom of enterprise under Articles 40 and 48 of the Constitution.

The judgment’s reasoning distinguishes between a shareholder wishing to continue the company’s business and one wishing to leave. However, the annulment judgment did not establish a detailed model for commencing proceedings and arranging representation in every situation. While the statutory requirement for a company request remains, legal scholarship continues to debate how a direct application by a shareholder in a two-shareholder company should be treated. Entitlement to bring the claim, decision-making on behalf of the company and representation in the proceedings should be assessed separately. This allows a course appropriate to the particular company to be identified without assuming in advance that a direct application is either available or definitively barred. 

How should pending or concluded cases be assessed?

Under the Constitution, annulment judgments do not operate retroactively. The judgment does not automatically overturn earlier court decisions that have become final. However, pending proceedings, final judgments on the merits and cases dismissed on procedural grounds for lack of a general assembly resolution must be considered separately. Reopening an earlier decision is different from bringing a new claim on the basis that the ground for dismissal no longer exists. The earlier decision’s reasoning, its finality and the conditions for a fresh application should be examined to determine the judgment’s effect on the particular case. 

How is the value of your shares determined when you leave?

In a share transfer, the price may be determined by agreement and any contractual valuation method. The parties may appoint an independent valuation expert and agree in advance on the financial data, valuation date and procedure for challenging the report. For statutory withdrawal or exclusion from a limited liability company, the basic measure is an exit payment corresponding to the actual value of the shares. The provision permitting different arrangements for a withdrawal right granted in the articles of association must be considered separately. 

An assessment of actual value should go beyond the nominal amount recorded as capital. The economic value of the company’s assets, its liabilities, ability to continue operating, earnings prospects and risks are considered together. The valuation should explain which asset-based, income-based or comparable-company method is appropriate and why it was chosen. This links the calculation to the company’s actual business and financial structure.

During litigation, a court-appointed expert may carry out the technical valuation. The relationship between the data, methodology and conclusion should be capable of review, and objections to omissions or inconsistencies should be raised within the applicable time limit. The examination is conducted under the expert-evidence provisions of the Turkish Code of Civil Procedure No. 6100, while Article 641 of the TCC sets the basic measure for the exit payment. 

If a discount is proposed because the holding is a minority stake or the shares are difficult to sell, its legal and economic basis should be questioned. A negotiated share price and a statutory exit payment may be determined on different bases. The valuation date should also be selected according to the legal remedy used. In a joint stock company, particular attention should be paid to the actual value as at the date closest to judgment where the claimant’s departure is ordered as an alternative to dissolution for just cause.

When is the statutory exit payment payable?

In a limited liability company, determining the exit payment and assessing the ability to pay it should proceed together. Under the law, the exit payment becomes due on departure if the company has equity available for this purpose, the departing shareholder’s shares can be transferred or the capital is lawfully reduced. The available route and the source of payment should be identified specifically. 

Any unpaid balance ranks behind the claims of all other creditors. This claim becomes due when the amount of available equity is determined in the annual report. An exit plan must therefore consider not only the company’s value, but also how and when it can fund the payment. This creditor-protection rule directly affects the departing shareholder’s recovery risk. 

Where the other shareholder agrees to buy the shares, the debtor and payment terms are determined by the agreement. Distinguishing the company’s statutory exit payment from the purchase price payable by the buyer helps ensure that instalments, security and the timing of transfer are properly structured.

What protective measures are available while the dispute continues?

To protect rights, transactions should be documented and measures suited to the ongoing risks should be considered. For example, if implementation of a general assembly resolution challenged on grounds of annulment or nullity would cause harm, the court may be asked to suspend its implementation. 

In proceedings for withdrawal from a limited liability company, the court may, on request, suspend certain shareholder rights and obligations or order other measures to safeguard the claimant’s position. The court also has power to order necessary measures where dissolution of a limited liability company is sought. The application should explain which transaction or risk is to be prevented and the scope of the measure requested. 

If evidence may be lost or delay may cause serious harm, the conditions for judicial preservation of evidence and interim relief should also be examined. The assessment should seek a proportionate solution between the continuation of the company’s operations and the applicant’s protection. 

Does an arbitration clause in the shareholders’ agreement change the route?

Arbitration allows certain disputes to be resolved by arbitrators instead of state courts. The first questions are which persons and claims the arbitration clause covers and whether the dispute is capable of settlement by arbitration. This review should be completed before deciding where to bring proceedings. 

A contractual claim for payment of a share purchase price must be distinguished from claims for dissolution, withdrawal or invalidity of a general assembly resolution. The position of the company and other shareholders, as well as the effects of the decision to be made, are also relevant. As there are differing approaches to the arbitrability of corporate disputes, the existence of an arbitration clause should not lead to all claims being referred to the same forum.

Can you agree on an exit or a way to continue without litigation?

Negotiations may first explore whether an arrangement can be found that enables the shareholders to continue working together. Regular financial reporting, changes in management responsibilities or additional controls over certain transactions may be options in some disputes. Where an exit is preferred, payment security and the management handover should be addressed alongside the value of the shares.

The agreement should clearly state when the shares will be transferred, how the price will be paid and how claims between the company and the shareholder will be settled. The ending of management and signing authority, delivery of documents and treatment of ongoing contracts should follow a coordinated timetable. It should also be established whether the participation of the bank or other creditor is needed to release personal guarantees or other personal security given for company borrowings.

The nature of the claim determines whether pre-action mediation is mandatory and how any arbitration arrangement affects the process. Application deadlines must continue to be monitored during ordinary settlement discussions. The effects of a properly conducted mediation process on limitation periods and preclusive time limits are assessed under the rules governing mediation. 

Conclusion

Resolving a shareholder dispute starts with identifying what you wish to protect and the outcome you want to achieve. Continuing the company’s business, addressing management problems, seeking the other shareholder’s exclusion and leaving in return for the value of your shares are different options. The legal route should be determined on the facts, without treating any of these objectives as inherently preferable.

The first steps are to collect documents, identify rights subject to deadlines and assess ongoing risks. A workable plan can then be developed by considering the company type, shareholding percentages, agreements, financial position and prospects of recovery together. The objective is not simply to start proceedings, but to find a solution that protects shareholder rights and the company’s value.

This article is for general information only and does not constitute a legal opinion on any individual matter.