Corporate Legal Counsel in Türkiye: When and Why Companies Need It

Most companies meet a lawyer for the first time when something has already gone wrong. A receivable goes unpaid, a customer wants to terminate, or an enforcement notice arrives.

By then, options are limited. Most of the decisions that determine the outcome were made much earlier: when the contract was signed, when collateral was taken, when payment terms were set.

Corporate legal counsel exists to get those decisions right.

Where Companies Need Support

The most common areas:

• Contracts: sales, supply, dealership, distribution, service and lease agreements
• Debt collection: formal notices, enforcement proceedings, objections and lawsuits
• Company law: general assembly and board resolutions, share transfers, shareholder relations
• Commercial disputes: pre-litigation negotiation, mediation and court proceedings
• Financial distress: debt restructuring, concordat (konkordato) and capital loss

Contracts: Where Most Problems Start

A well-drafted contract is a company’s strongest document in a dispute. A poorly drafted one is its biggest weakness.

Pay particular attention to:

• Payment terms and default interest
• Termination rights and notice periods
• Penalty clauses and liability caps
• Jurisdiction and dispute resolution
• Collateral

These clauses directly determine your chances and speed of collection.

Debt Collection: Plan the Evidence Early

Starting enforcement in Türkiye is easy. Once the debtor objects, you need to prove the claim.

Invoices, delivery notes, contracts, account reconciliations and correspondence become decisive. Companies that keep these in order resolve disputes much faster.

We explain the lawsuit that follows a contested enforcement in Action for annulment of objection.

Mandatory Mediation in Commercial Disputes

For commercial cases seeking payment of a sum of money, such as receivables and damages, applying to a mediator before filing suit is a procedural requirement in Türkiye.

Well prepared, mediation can be quick and inexpensive. Entered unprepared, it can weaken your negotiating position.

When the Balance Sheet Sounds the Alarm: Capital Loss

Many directors are unaware of this duty. Under Article 376 of the Turkish Commercial Code (Türk Ticaret Kanunu):

• If the latest annual balance sheet shows that half of the share capital and statutory reserves is uncovered due to losses, the board must immediately convene the general assembly and propose remedial measures.
• If the loss reaches two thirds and the general assembly does not resolve to reduce or replenish the capital, the company is dissolved by law.
• If over-indebtedness is suspected, interim balance sheets must be prepared, and if confirmed, the court must be notified.

These duties also apply to limited liability companies. Failure to comply can trigger directors’ personal liability.

This is exactly where financial and legal assessment must happen together.

Ongoing or Matter-Based?

For companies that sign contracts regularly, run continuous collections or are in a growth phase, ongoing legal counsel is usually more predictable and cost-effective.

For companies with occasional needs, working on a specific matter or project basis may be better.

How Denova Helps

With Legal Advisory, we support companies on Turkish commercial law, enforcement and bankruptcy law, contracts and commercial disputes. Because we work alongside our financial advisory team, we see the financial effect of legal decisions from the start. We can work in English and German.

To discuss your company’s legal needs, write to us.