Buying a Turkish Company: Legal Due Diligence Before Signing a Share Purchase Agreement

Direct answer: A “buy Turkish company legal due diligence” project should begin before the share purchase agreement is fixed, because a share acquisition transfers ownership of the same company while its contracts, employees, debts, disputes and historic compliance generally remain inside it. Registry records alone are not enough. A foreign buyer should verify corporate authority and title to shares, financial debt and security, tax and social-security exposure, litigation and enforcement, material contracts, employment, real estate, licences, data, intellectual property and competition approvals.

Findings must then change the deal: price, conditions precedent, specific indemnities, warranties, disclosure, escrow, covenants or, for an unacceptable risk, scope or withdrawal. A long report that does not connect each risk to an SPA response is not useful due diligence.

Company Due Diligence: 2026 legal check

2026 legal check: Share-transfer formalities differ between limited and joint stock companies, and registry entries alone may not prove current joint-stock ownership. Existing companies below the statutory minimum capital must align by 31 December 2026 or face dissolution risk. Companies registered from 1 January 2026 may have mandatory ETDS corporate books. The February 2026 merger-control thresholds and special technology-undertaking rule require a transaction-specific turnover review before closing. Due diligence does not remove historic liabilities; tailored warranties, indemnities, conditions and escrow may allocate remaining risk. The Company Due Diligence assessment must use the current official text and the documents in the individual file.

Confirm whether the deal is for shares or assets

In a share deal, the buyer acquires shares or capital interests in the existing legal person. The target normally continues to own its assets and owe its liabilities. In an asset deal, selected assets, contracts or a business may be transferred, but liabilities can still follow under mandatory rules, contract assumptions or the nature of the transaction. Employees, permits, leases, tax and creditor effects differ.

Define the perimeter in writing before diligence starts. If the commercial intention is to buy a factory, brand and customer book but not a historic entity, do not automatically use a share SPA. Conversely, an asset deal may require numerous consents and individual transfer formalities. The legal structure should match the assets and risks the buyer actually wants.

Buy Turkish company legal due diligence: define the scope

The buyer, counsel and financial and tax teams should agree the target companies, look-back period, materiality criteria, jurisdictions and known risk themes. Create a request list tailored to the sector rather than uploading a generic checklist. A regulated health, energy or fintech target needs different testing from a local distributor.

Materiality is not merely a monetary threshold. Loss of a small permit, key domain, exclusive supplier or founding engineer may be commercially fundamental even if the immediate accounting value is low. The scope should also distinguish legal verification from financial, technical, environmental and cyber work, while assigning responsibility for issues that cross those boundaries. Record exclusions clearly so the investment committee knows what has not been tested.

Use a controlled data room with an index, permissions and download history. Record when each document was provided and whether it is draft, signed, expired or incomplete. Management interviews should answer written gaps, not replace documents. Confidentiality and clean-team arrangements may be required where buyer and target compete. Our article on disclosure of Turkish company trade secrets addresses why access must be purpose-limited.

Corporate status and title to the shares

Obtain the current articles, all relevant Turkish Trade Registry Gazette announcements, shareholder or pay ledger, share certificates where applicable, management records and powers of representation. Reconcile legal name, capital, shareholders, transfers and encumbrances across sources. Check whether earlier capital contributions and transfers were validly approved and registered where required.

Review shareholder agreements, options, convertibles, pledges, usufruct, pre-emption rights and litigation affecting title. Verify that each seller can sign and deliver the shares and that corporate approvals are correctly designed. Public records can reveal important facts but are not an exhaustive ownership warranty. Any gap should become a closing deliverable or specific seller protection.

Governance, books and related-party dealings

Read general assembly, board and manager resolutions for major acquisitions, borrowing, guarantees, dividends and conflicts. Compare registered representation with actual bank and contract signatures. Missing approvals or a de facto controller may create validity, liability or compliance questions. The guide on board-member liability under TCC Article 553 highlights management duties that may survive a change of owner.

Test statutory books and electronic records for continuity and evidential reliability. The site’s article on electronic commercial ledgers explains one current record system. Identify loans, service fees, asset transfers and guarantees involving shareholders or group companies and decide which will be settled, assigned or continued at closing.

Debt, security and financial distress

Map bank facilities, bonds, shareholder loans, leasing, factoring, guarantees, letters of credit, pledges, mortgages and assignment of receivables. Ask lenders for current payoff and release mechanics when debt will be repaid. Check change-of-control and cross-default terms rather than assuming facilities continue.

Review overdue tax, social-security, supplier, salary and rent obligations and compare them with management accounts. A company near capital-loss or insolvency thresholds raises immediate management and transaction issues; see capital-loss and insolvency duties. The buyer should not rely on a seller warranty when an urgent solvency measure is required before closing.

Litigation, enforcement and public-law exposure

Request a complete dispute schedule covering courts, arbitration, mediation, enforcement offices, criminal complaints, administrative investigations and threatened claims. UYAP and counsel confirmations can verify accessible Turkish proceedings, but searches may not reveal every confidential, foreign or unfiled matter. Reconcile the schedule with provisions in the accounts and board minutes.

Inspect attachments, interim injunctions and enforcement affecting shares or key assets. Review tax audits, customs, competition, environmental, consumer, municipal and sector correspondence. A complaint that has not yet produced a formal case may still be material. For statutory merger mechanics, creditor security in a Turkish merger concerns a different transaction and should not be mistaken for share-sale creditor protection.

Material contracts and change of control

Prioritise contracts that create revenue, supply continuity, exclusivity, debt, data access, licences or strategic dependence. Record term, renewal, termination, assignment, change-of-control, pricing, currency, minimum purchase, warranty, indemnity and dispute clauses. Confirm that signed versions and amendments exist and that performance matches the paper.

A share deal does not automatically transfer contracts to a new legal person, because the target remains the party. Yet a change-of-control clause may require consent or permit termination. Government permits or concession documents can have their own control rules. Obtain critical consents as conditions precedent where closing without them would destroy the deal’s value.

Employees, benefits and key people

Review employee lists, contracts, payroll, seniority, unused leave, bonuses, commissions, restrictive covenants, workplace policies, union or collective arrangements, occupational safety, work permits and pending claims. Compare formal employer records with people actually working for the target, including consultants and group secondees.

A share transfer generally leaves the employing company in place, but the buyer inherits its employment history and culture. Identify key-person retention needs and any transaction bonus before signing. Do not ask the seller to dismiss and rehire everyone without analysing severance, continuity and discrimination risk.

Assets, real estate, IP and data

Verify title, leases, zoning, occupancy, permits, mortgages and environmental issues for material premises. Inspect movable-asset registers, inventory and insurance. A factory operating under a group company’s informal permission is not equivalent to ownership or a durable lease. Physical condition belongs in technical diligence but legal rights must be documented.

For intellectual property, identify registered marks, patents, designs, domains, software and know-how; then trace creation and assignment from employees and contractors. Review licence scope and open-source obligations. For personal data, map lawful bases, notices, transfers, security incidents, processor contracts and regulator correspondence. Remediation may need to start before data is exposed to the buyer.

Licences, competition and foreign-investment issues

Confirm every licence needed to operate and whether control changes require notification, consent or reapplication. Check expiry, conditions, inspections and pending sanctions. A licence displayed at one facility may not cover a new product, location or owner.

Assess merger control under the current Law No. 4054 regime and official thresholds, including the parties’ group turnover and transaction structure. Do not hard-code an old threshold into the SPA. If notification is required, closing and control transfer must respect the applicable process. Sectoral foreign-ownership or security approvals may operate separately.

Translate findings into SPA protection

Finding	Possible deal response	Evidence at signing or closing
Missing critical consent	Condition precedent or carve-out	Written counterparty or regulator consent
Quantified historic liability	Price adjustment, repayment or specific indemnity	Payoff, release or escrow arrangement
Uncertain tax or litigation exposure	Specific indemnity, retention and conduct rights	Disclosure, adviser report and claims protocol
Correctable compliance gap	Pre-closing covenant and verification	Filing, policy, licence or remediation record
Fundamental title problem	No closing until cured; possible termination right	Valid transfer chain and clean encumbrance record

Warranties allocate information and risk but do not repair the business. Negotiate caps, baskets, time limits, exclusions, disclosure standards and claim control with the risk’s nature in mind. Insurance, escrow and guarantees are only useful if enforceable and sized for the exposure.

Signing, interim period and closing

Build a conditions checklist showing owner, form and completion evidence. During the gap between signing and closing, ordinary-course covenants should preserve value without giving the buyer unlawful premature control. Sensitive competitive information requires disciplined access.

At closing, coordinate share-transfer formalities, corporate approvals, registry steps, consideration, debt payoff, releases, resignations, appointments, bank mandates and delivery of books and credentials. Create a signed closing set and post-closing schedule. Do not leave control of corporate e-notification, banking or registry access with a departing seller representative.

What to send for an initial acquisition review

Provide the term sheet, structure, target name and sector, buyer and seller countries, price concept, timetable, known risks and data-room index. Identify whether competitors are involved and whether financing or a regulatory approval is required. A preliminary scope should specify red-flag work before exclusivity expires and deeper work before signing.

Do not send an unrestricted data-room link by ordinary email. Agree confidentiality, secure access and the buyer adviser team first. Turkish counsel can coordinate a target anywhere in Turkey, while registry, facility, regulator and litigation checks follow the company’s actual footprint.

Official sources checked

• Turkish Commercial Code No. 6102;
• MERSİS official company-registration portal;
• Turkish Trade Registry Gazette official portal;
• Turkish Competition Authority — Law No. 4054 and official Board decisions;
• Ministry of Justice UYAP Citizen Portal.

Checked on 20 September 2026. Merger-control thresholds, registry practice and sector approvals must be verified against the current official rules and transaction facts.

Frequently asked questions

Do I inherit all debts when I buy the shares?

The target remains debtor for its existing obligations, and the buyer acquires that economic exposure through ownership. Personal liability depends on separate legal bases, but the SPA should allocate known and unknown risk.

Is the Trade Registry Gazette enough to prove ownership?

No. Review the applicable company-form transfer rules, shareholder or pay ledger, certificates, approvals, agreements and encumbrances alongside public records.

Can due diligence be completed only from UYAP?

No. Accessible court data is useful but does not replace enforcement, arbitration, administrative, foreign, threatened-claim and internal-record review.

Should I sign the SPA before diligence finishes?

Commercial circumstances differ, but unresolved critical risks should be reflected in conditions, price, indemnities or a right not to close. Signing without access may weaken leverage.

What is a red-flag report?

It is a prioritised report on issues capable of changing value, structure, timing or willingness to proceed. It is not confirmation that unreported areas are risk-free.

Does a share sale require every contract to be assigned?

Normally the target remains the contracting party, but change-of-control clauses, licences and special laws may still require consent or create termination rights.

How are historic tax risks handled?

Use tax diligence, disclosure and tailored protections such as specific indemnities, retention or escrow. Current limitation and assessment rules must be checked with tax counsel.

When is Competition Authority approval needed?

Apply the current turnover thresholds, control test and transaction rules to the parties’ groups. Never rely on a threshold remembered from an earlier year.

Can the buyer contact employees before closing?

Only under an agreed, lawful communication and data plan. Premature approaches can breach confidentiality, disrupt the workforce or imply control before completion.

What should happen to data-room disclosures?

Preserve a dated, final disclosure set tied to the SPA. A changing online folder without a closing archive creates later disputes over what the buyer actually received.

Publication and legal-information notice

Publisher: Attorney Emirhan Keskin, Mersin Bar Association registration no. 5507.

Legal information updated: 21 September 2026.

This article is general information about Turkish acquisition diligence and is not transaction-specific advice. It does not create an attorney–client relationship or guarantee that diligence will identify every liability.