NEWSLETTER-2020-metin

49 COMMERCIAL LAW Limitations to Dividend Distributions of Capital Companies and Exceptions Thereof* Att. Ecem Çetinyılmaz Introduction One of the measures taken to mitigate the threat imposed on economic life by the novel coronavirus (Covid-19), which has been declared a pandemic by the World Health Organization, is related to the dividend distribution of capital companies. In this context, with provisional Article 13 added to the Turk- ish Commercial Code numbered 6102 (“TCC”) through the Law No. 7244 on the Mitigation of the Impacts of the Novel Coronavi- rus (COVID-19) Outbreak on Economic and Social Life and on the Amendment of Certain Laws, certain limitations have been introduced regarding the dividend distribution decisions to be adopted by the capital companies until 30 September 2020, for the purposes of not reducing company resources by means of cash dividend distribution, protecting companies’ existing equity structures, and avoiding addi- tional financing needs 1 . Subsequently, through the Communiqué on the Methods and Principles Regarding the Application of Provisional Article 13 of the Turkish Commercial Code No. 6102 2 (“Communiqué”) issued by the Ministry of Trade (“Ministry”), exceptions to these limitations, as well as the conditions and procedures for capital companies to benefit from such exceptions, have been determined. * Article of May, 2020 1 Preamble of Article 12 of the Law No. 7244. 2 The Communiqué (Official Gazette, 17.05.2020, No. 31130) entered into force through publication.