Under Turkish statutory law, a limited liability company (LLC) is required to have at least one manager, unless the articles of association (“articles”) of the company specify a higher number of managers. There is no maximum number of managers. The managers can either be appointed from amongst the shareholders of such company or from outside the company. However, at least one shareholder should be appointed as a manager of the company.
The managers are not required to be resident in Turkey; however a foreign manager would be required to obtain a Turkish work permit should they be required to stay in Turkey and actively participate in the day to day running of the entity. If a foreign manager does not actively participate in the day to day running of the entity, he/ she is required to obtain a residence permit. Foreign managers are also required to obtain a tax number. If the Manager is a Turkish citizen residing out of Turkey, he/she is required to provide a document proving their residence or work in a foreign country (equivalent to a residence or work permit).
There is no maximum duration of term for a managers. The manager can be reappointed for a new term after their term expires.
There are no formal qualifying requirements for managers. Any natural person with full legal capacity (ie at least 18 years of age and not regarded as mentally ill) can be appointed a Manager.
A legal entity either registered in Turkey or abroad, can also be appointed as a Manager. In this case, it should appoint a natural person representative who will execute the Manager’s functions. Such legal entity should be duly validly registered and conduct its activities in accordance with the laws of country of its registration.
If the company has more than one manager then a Chairman of the Board should be appointed by the Shareholders’ Assembly. The Chairman of the Board or sole manager of the company is entitled to convene the shareholders’ Assembly meetings and manage them, as well as to make all declarations and announcements of the company, unless otherwise is set out in the articles of association or decided by the Shareholders’ Assembly. There are no other compulsory requirements relating to the composition of the Board.
There is no minimum number of board meetings required each year prescribed by Turkish law. Board meetings shall be held whenever it is deemed necessary for the business operations of the Company. However, taking into consideration that a Shareholders’ Assembly meeting should be convened at least once per year, and the convocation of such Shareholders’ Assembly meeting is executed by the Board of Managers, it can be concluded that the Board should be convened at least one per year.
There is no minimum number of managers that must attend the Board meeting set forth under Turkish law. In this respect, resolutions will be deemed as adopted if accepted by the majority of the Board members. There are no requirements in relation to notice periods of the Board meeting.
Please note, where more than one manager is appointed, resolutions must be approved by a majority. If the votes of the managers are tied then the Chairman’s vote prevails. However, such procedure of resolution by the managers can be regulated differently in the Articles.
If the Board of Managers consists of more than one member, each member is granted joint signatory powers. However, powers may be provided by the Articles or resolved by the Shareholders’ Assembly.
Representation powers of the Board can be restricted by an internal directive of the company (for example, restrictions on a manager to sign documents with a value of up to a certain amount can be imposed) provided that such resolutions are registered with the Trade Registry Office and are announced in the Turkish Trade Registry Gazette.
Unless the Articles provides otherwise, or all shareholders grant their written consent, the managers are prohibited from conducting any activities which compete with the company’s activities.