The kind of company being established to keep the limited liability company-in short LO is called Shell Corporation. It has been prevented by increasing the minimum capital amount to 5 billion TL, in a large scale.

ESTABLISHMENT PROCEDURE :

1) Preparation of the Articles of Association: The Law has required an aggravated from in the Article of Association. The form that is requisite of validity is realized by three elements (components) coming together;

a) Written form.
b) Confirmation of all the signatures of the founders by Notary Public
c) Obligatory stipulation to be included in the contract.

Written form is a requisite of validity. A Limited Company cannot be established by verbal agreement.
Signature of the founders and confirmation of the Notary Public are also the requisites of validity.
Besides, Limited Company Main Agreement being prepared and signed by the founders and signatures being confirmed by the Notary Public and then applied to the Trade Registry Office situated at the job-site of the company.(Previously, though the permission of the STB was another requisite, it no longer exists(it has already being arrogated)

The obligatory requisite of the contract of a company are;

1) Trade name and job site of a company; According to the communiqué of STB, a trade-name has to be in Turkish. However, in case the goods and services defining a name and trade-mark are of a foreign language or there doesn’t any equivalent in Turkish then a foreign name in foreign capital companies is permitted. The name of the job-site is to take place in the agreement.
2) Subject matter of the company is also to be included in an agreement.
3) Capital and stipulated amount of capital of every shareholder is also to be included in a contract. That is 1/4 (one fourth) amount of the capital (in kind has already been paid or stipulated to be paid maximum within 3 years should also take place in a agreement.
4) Form of the announcements.
5) Duration of the company to be included in an agreement is also obligatory.
6) Form and time as to how the profit and loss to be distributed.
7) Amount of the reserve funds.
8) Appointment of the directors.
9) Balance sheet and list of profit and loss to be delivered to STB every year, should also be included.,
However the last 4 articles aren’t of obligatory recordings that the law needs.
Then; what if a deficient or errand LO is established then can it be considered as an ordinary partnership?
What the doctrine presumes is that in such cases the relation between the founders of a LO can be considered that way.

Some of the assets to be contributed (invested) have been mentioned in Turkish Commercial Court in short TTK article 139… Movable and immovable goods, rights that are deemed non-material privileges, patents, good-will, know how etc…
Individual Labor or commercial prestige cannot be contributed to LO”s as capital. Since the responsibility is limited by property consequently the elements of capital should be a kind of assets.

Some of the main capital may be totally or partially capital in kind. In case it is stipulated that the capital to be invested is in kind then it should clearly be mentioned in the contract, as what kind of capital it is, the way of its evaluation and what amount to be set-off from the stipulated capital and what amount of capital stock-share to be given back to the stipulator, the value of assets other than Money such as rights, privileges and goods being contributed as capital should be estimated by the experts to be appointed by Courts according to expert’s report. The said stipulation has to be carried out within maximum 3 months following the establishment of LO. If the rights being contributed as capital are of kind being registered to a special registry office (traffic, land registry, shipping registry etc..) then they have to be registered within maximum 3 months following the date of registration in the name of the shareholder (It seems that STB communiqué no 2003/3 enables that kind of registration to be carried out ex officio)
According to TTK Article 140/3 even if the transfer of rights to be stipulated as capital are bound to special conditions then the contract substitutes these private or official formalities and it acknowledges these rights to be transferred by LO without getting the permission of the shareholders.

2) The Transaction of Registration;

As the main contract being signed in the Notary Public and necessary documents be annexed to the contract then within maximum 15 days, the concerning people have to apply the Registry Office.
The civil servant of the registry Office having examined the documents accomplishes the registration.
The results of registration and announcement are as follows;

a) Achieving the statue of legal entity.
b) Some of the articles of the contract are implemented for the 3rd parties beginning from the announcement
c) Only after the registration LO can either be terminated or dissolved.
d) Persons who have committed transactions before the registration on behalf of the company are individually liable for them but if LO confirm such transactions within maximum 3 months then in that case those who have committed them are no longer responsible. That the confirmation to be valid on behalf of the company it should be clearly mentioned that the said transaction has been committed on behalf of the company to be registered in the future.