Corporate law and Company Organizations
Corporate law is a branch of law that determines and regulates the legal framework of organizations engaged in commercial activities. This branch of law includes a wide range of provisions from the establishment, management, activities and termination of companies. Company organizations are of vital importance for entrepreneurs because a proper start-up greatly affects the success of the company. In this article, company law and the main stages of company incorporation will be discussed in detail.
What is Corporate Law?
Corporate law covers the legal regulations regarding the establishment, operation, management and termination of companies. This branch of law regulates the internal functioning of companies and their relations with other companies, government agencies and individuals. Corporate law includes the following topics:
1.Company Types: Principles of organization and operation of various types of companies such as joint stock companies, limited liability companies, collective companies, limited partnership companies and cooperatives.
2.Management and Supervision: Governing bodies of companies, duties and responsibilities of board members, audit mechanisms.
3.Capital and Financing: Capital structure of companies, shares, profit distribution and financing methods.
4.Mergers and Acquisitions: Mergers, acquisitions and spin-offs of companies.
5.Liquidation: Termination of companies and liquidation processes.
Company Establishments
Company incorporation is a complex process in which certain legal procedures must be followed. This process may vary depending on the type of company and the country. Here are the general steps to be followed for company incorporation in Turkey:
1.Determination of Company Type:
- Joint Stock Company (JSC): It can be established with at least five founding partners and capital can be increased through share certificates.
- Limited Liability Company (LLC): It can be established with at least one co-founder and is suitable for smaller businesses.
- Collective Company: A type of company in which the shareholders are unlimitedly liable for the debts of the company.
- Comandite Company: It is a type of company in which some of the partners have unlimited liability and some have limited liability.
- Cooperative: It is a type of company established to protect certain economic interests of the shareholders.
2.Preparation of the Articles of Association:
The company’s articles of association is the document stating the company’s purpose of establishment, fields of activity, capital structure and governing bodies. This agreement must be notarized.
3.Trade Registry Registration:
The company must be registered with the Trade Registry Directorate after the approval of the articles of association. This registration provides the company with legal personality.
4.Tax Office and Social Security Institution (SSI) Records:
The company must be registered with the tax office and the Social Security Institution. This is necessary for obtaining a tax number and for the insurance of employees.
5.Capital Commitment and Bank Accounts:
A certain portion of the company capital must be deposited in the bank and a capital blocking letter must be obtained. In addition, bank accounts must be opened for the company’s business activities.
Case Study: Establishment of a Limited Liability Company
Ms. Ayşe is an entrepreneur who wants to start her own business. She decides to establish a limited liability company. Here are the steps she needs to follow:
1.Choosing the Company Type: Ms. Ayşe decides to set up a limited liability company because this type is suitable for small and medium-sized businesses.
2.Preparation of the Articles of Association: Ms. Ayşe prepares the articles of association of the company with the help of a lawyer. The articles of association include the company’s name, address, capital, shareholders’ information and fields of activity.
3.Notary Approval and Trade Registry Registration: The articles of association are notarized and registered with the Trade Registry Office. The company is officially established.
4.Tax Office and SSI Records: Ms. Ayşe goes to the tax office to get her tax number and then goes to the SSI to file the insurance transactions for her employees.
5.Opening Bank Accounts: A certain portion of the company capital is deposited in the bank and commercial accounts are opened.
Company law and company organizations are one of the cornerstones of commercial life. A correct and lawful start-up greatly affects the long-term success of the company. When establishing a company, legal procedures must be carefully followed and the necessary documents must be completed in full. In this process, seeking professional legal advice can make the process smoother and faster. It should not be forgotten that the foundation of a successful company is laid with a solid establishment process.