Board Meetings and Void Board Resolutions in a Turkish Joint Stock Company: Calling the Board, Quorum, Circular Resolutions, Conflicts of Interest and Nullity (TCC 390-393)
A foreign investor who holds a seat on the board of a Turkish joint stock company (anonim şirket) will sooner or later face practical questions. Can the board meet without me? Can I send a colleague with my proxy? Is a resolution circulated by e-mail valid? What happens if the chair simply refuses to call a meeting? And if the majority adopts a resolution that takes away a shareholder's rights, is there anything to challenge? The Turkish Commercial Code (TCC, Law No. 6102) answers these questions in a short group of articles. Article 390 sets the meeting and decision quorum, the ban on proxies, the tie rule, written (circular) resolutions and the requirement that resolutions be written and signed. Article 391 lists board resolutions that are void (batıl). Article 392 gives every board member information and inspection rights and, since the 2024 amendment, a route to force a meeting. Article 393 bars a member from deliberating where a personal interest conflicts with the company's interest. This guide walks through each rule as the statute words it, with the points that matter for foreign shareholders and their nominee directors.
1. Who Calls the Board and How a Member Can Force a Meeting
The TCC does not leave the board without a leader. Under TCC 366(1), the board elects from among its members a chair and at least one vice-chair who acts when the chair is absent; the articles of association may provide that the chair and the vice-chair, or one of them, are elected by the general assembly. Under TCC 366(2) the board may also set up committees and commissions, which may include board members, to follow the course of business, prepare reports, implement its resolutions or carry out internal audit.
Calling a meeting is the chair's task, and before 2024 the statute only said that a member could ask for it. TCC 392(7) still begins with that rule: every board member may ask the chair in writing to call the board. Law No. 7511 of 23 May 2024 added the following sentences:
- If the request is found appropriate, the chair makes the call.
- However, upon the written request of the majority of the board members, the chair must call the board to a meeting to be held at the latest within thirty days from the date the request reached the chair.
- If the board is not called within that period, or if the chair or the vice-chair cannot be reached, the call may be made directly by the members who made the request.
- At meetings held on such a call, the meeting and decision quorums of TCC 390(1) apply.
- The articles of association may set a different procedure for calling the board.
Two practical points follow from the text. First, a single member's request does not trigger the thirty-day duty; it is the request of the majority of members that does. Second, because the articles may set a different calling procedure, a foreign shareholder negotiating a joint venture should read, and if necessary draft, the calling clause with care: the statute allows the articles to set a different procedure for calling the board, for example on notice periods and the form of notice.
2. Quorum, Majority, No Proxies and the Tie Rule (TCC 390(1)-(3))
TCC 390(1) contains the default rule: unless the articles of association contain an aggravating (stricter) provision, the board meets with the majority of the total number of members and adopts its resolutions with the majority of the members present at the meeting. The article adds that the same rule applies where the board meeting is held in an electronic environment.
Each element matters. The meeting quorum is counted on the total number of members, not on the members who happen to be in office or in the country. The decision majority is counted on the members present. The statute refers only to an aggravating (stricter) provision in the articles, for example a higher meeting quorum or a qualified majority for certain matters; when drafting, the statutory majority should therefore be treated as the minimum.
TCC 390(2) is short and strict: board members cannot vote on behalf of one another and cannot attend meetings through a representative (vekil). A foreign director who cannot travel therefore cannot send a colleague with a power of attorney to sit and vote in their place. If the articles allow it, attending electronically is the lawful alternative (see section 3).
TCC 390(3) deals with deadlock: if the votes are equal, the matter is left to the next meeting; if there is equality again at the second meeting, the proposal is deemed rejected. The statute does not give the chair a casting vote in a joint stock company. (For limited companies the position is different: under TCC 624(3), where there are several managers, they decide by majority and the chair's vote prevails in a tie; the company contract may provide a different arrangement for the managers' decision-making.)
| Question | Statutory rule | Can the articles change it? |
|---|---|---|
| Meeting quorum | Majority of the total number of members (TCC 390(1)) | The statute refers to a stricter (aggravating) rule |
| Decision majority | Majority of members present (TCC 390(1)) | The statute refers to a stricter (aggravating) rule |
| Electronic meeting | Allowed if provided in the articles; the same quorums apply; electronic voting conditions of TCC 1527(3) (TCC 390(1), 1527(1), (3)) | The articles must provide for it |
| Proxy voting or attendance | Not allowed (TCC 390(2)) | No |
| Tie | Next meeting; second tie = rejected (TCC 390(3)) | The statute gives no casting vote |
| Resolution without a meeting | Written approval of at least the majority of the total number of members, proposal made to all members (TCC 390(4)) | Not available if a member asks for a meeting |
| Form | Valid only if written and signed (TCC 390(5)) | No |
3. Resolutions Without a Meeting and Electronic Board Meetings (TCC 390(4)-(5), 1527)
A Turkish joint stock company may adopt board resolutions in writing, by circulating a draft for signature. TCC 390(4) allows this, but on conditions that should be followed exactly:
- No member asks for a meeting. The written route is available only if none of the members requests that a meeting be held.
- A proposal in the form of a resolution. One of the board members makes a proposal on a specific subject, written in the form of a resolution.
- Approval by at least the majority of the total number of members. The majority is counted on the full board, not on those who reply.
- The same proposal to all members. The statute makes it a condition of validity that the same proposal was made to all board members. A draft sent only to the members expected to agree does not meet this condition.
- The book. The approvals need not be on the same sheet, but for the resolution to be valid, all sheets bearing the approval signatures must be pasted into the board resolution book, or the text must be turned into a resolution containing the signatures of those who accepted it and entered in the book.
TCC 390(5) then states the general rule for every board resolution: its validity depends on its being written and signed. An oral agreement reached on a call, or an exchange of messages that is never turned into a signed resolution, does not satisfy this provision.
Electronic meetings are governed by TCC 1527(1): provided that it is regulated in the articles of association, the board of a capital company may meet entirely electronically, or some members may attend electronically a meeting at which other members are physically present. In both cases the meeting and decision quorums in the Code and in the articles apply unchanged. TCC 1527(3) adds conditions for voting electronically in these cases: the company must have a website dedicated to this purpose, the member must request to vote this way, a technical report must prove that the electronic tools allow effective participation and that report must be registered and announced, and the identities of those voting must be kept. A shareholder that wants its foreign nominee directors to be able to attend remotely should therefore make sure the articles contain this provision and that the conditions of TCC 1527(3) are in place.
4. Conflicts of Interest: When a Board Member Must Stay Out of the Deliberation (TCC 393)
TCC 393(1) prohibits a board member from taking part in deliberations on matters where the company's interest conflicts with the member's own personal interest outside the company, or with the personal interest outside the company of the member's descendants or ascendants, spouse, or blood and in-law relatives up to and including the third degree. The ban also applies where staying out of the deliberation is required by the rule of good faith.
The article then sets out how doubtful cases are handled and what the member must do:
- Where there is doubt, the board decides whether the ban applies, and the member concerned may not take part in that vote either.
- Even if the board does not know of the conflict, the member concerned must disclose it and comply with the ban.
- Under TCC 393(3), the reason for not taking part and the related transactions are written into the board resolution.
TCC 393(2) attaches liability to the rule. The member who acts contrary to it, and, where the conflict objectively existed and was known, the members who did not object to that member's participation and the members who resolved that the member could participate, are obliged to compensate the loss the company suffers for that reason. For a joint venture this is a practical point: when the board approves a contract with one shareholder's group company, the directors nominated by that shareholder should consider whether TCC 393 applies to them personally, and the minutes should record the outcome.
5. A Board Member's Right to Information and Inspection (TCC 392(1)-(6))
A nominee director who is kept away from information cannot do the job, and the TCC treats information rights as a core protection. Under TCC 392(1), every board member may ask for information about all the company's business and transactions, ask questions and carry out inspections. A member's request that any book, book entry, contract, correspondence or document be brought before the board, examined and discussed by the board or by members, or that information be obtained from a manager or employee on any subject, cannot be refused; if it is refused, the procedure in paragraph 4 applies.
TCC 392(2) adds that, at board meetings, persons charged with the company's management and committees must provide information like all board members, and a member's request on this point cannot be refused and questions cannot be left unanswered.
Outside board meetings, TCC 392(3) allows a member, with the chair's permission, to obtain information from persons charged with management about the course of business and particular transactions and, if necessary for the performance of the member's duties, to ask the chair for the company's books and files to be made available for inspection. If the chair refuses, TCC 392(4) sets a short route:
- the matter is brought before the board within two days;
- if the board does not meet or refuses the request, the member may apply to the commercial court of first instance (asliye ticaret mahkemesi) where the company has its head office;
- the court may decide on the file, and its decision is final.
Under TCC 392(5), the chair cannot obtain information or inspect books and files outside board meetings without the board's permission, and may use the same court route if refused. TCC 392(6) provides that a member's rights under the article cannot be restricted or removed; the articles and the board may extend the members' information and inspection rights.
6. Void Board Resolutions: What TCC 391 Covers and What It Does Not
TCC 391(1) provides that a declaration that a board resolution is void (batıl) may be requested from the court. It then states that, in particular, the following resolutions are void:
- (a) resolutions contrary to the principle of equal treatment;
- (b) resolutions that do not conform to the basic structure of the joint stock company or that disregard the principle of protection of capital;
- (c) resolutions that infringe shareholders' rights, in particular their inalienable rights, or restrict or hinder the exercise of those rights;
- (d) resolutions that encroach on the non-transferable powers of other organs, and resolutions on the transfer of those powers.
The word "in particular" shows that the list is not closed: the four categories are the ones the legislator chose to name, and whether a given resolution is void is for the court to assess on the facts. Some illustrations of how the categories can arise, without predicting any outcome: a resolution that grants one group of shareholders a benefit denied to others in the same position engages category (a); a resolution that distributes the company's capital to shareholders engages category (b); a resolution that obstructs a shareholder's participation in the general assembly engages category (c); a board resolution purporting to adopt the resolutions on the financial statements, which TCC 408(2)(d) reserves to the general assembly as a non-transferable power, engages category (d).
It is equally important to know what Article 391 does not say. It does not set a time limit, and it does not name who may bring the claim; who has standing in a given dispute is assessed by the court. It also does not create an action to annul board resolutions. The annulment action with its strict time limit belongs to general assembly resolutions (TCC 445 to 451), which Lexin Legal explains in a separate guide. For board resolutions the statute provides a declaration of nullity.
Category (d) concerns the non-transferable powers of the other organs, such as the powers that TCC 408(2) reserves to the general assembly, and resolutions on the transfer of those powers. The board's own non-transferable and inalienable duties are listed separately in TCC 375(1): the top-level management of the company and related instructions; determining the management organisation; establishing the system needed for accounting, financial control and, as far as management requires, financial planning; appointing and dismissing managers and persons with the same function, except branch managers (wording amended by Law No. 7511 in 2024); the top-level supervision of whether persons charged with management act, in particular, in accordance with the law, the articles, internal directives and the board's written instructions; keeping the share ledger, board resolution book and general assembly meeting and minutes book, preparing the annual report and corporate governance statement and submitting them to the general assembly, preparing general assembly meetings and executing their resolutions; and notifying the court where the company is over-indebted. Article 391 does not itself say how a board resolution that hands these duties of the board to someone else is to be treated; that question is for the court to assess, and such a resolution deserves particular care.
7. A Practical Checklist for Foreign Shareholders and Nominee Directors
The rules above are short, but each one has a document behind it. The following checklist follows the statute in order:
- Read the articles of association. Check whether they contain a stricter quorum (TCC 390(1)), a calling procedure (TCC 392(7)), a provision allowing electronic board meetings (TCC 1527(1), with the conditions of 1527(3)), and how the chair and vice-chair are elected (TCC 366(1)).
- Count on the full board. Before each meeting or circular resolution, check the meeting quorum and the written-approval threshold against the total number of members (TCC 390(1), (4)).
- Do not use proxies. A director who cannot attend should attend electronically if the articles allow it, not send a representative (TCC 390(2)).
- Circulate to everyone. A circular resolution must be proposed to all members, and the signed approvals must reach the resolution book (TCC 390(4)).
- Sign the resolution. Validity depends on the resolution being written and signed (TCC 390(5)).
- Record conflicts. Where a member stays out under TCC 393, the reason and the related transactions are written into the resolution (TCC 393(3)).
- Use the information route in time. If the chair refuses an information request made outside a meeting, the matter goes to the board within two days, and then to the commercial court (TCC 392(4)).
- Test resolutions against Article 391. Before adopting a resolution that affects shareholders' rights, capital or the powers of the general assembly, check it against the four categories in TCC 391(1) and the non-transferable duties in TCC 375(1).
Where a board resolution has already been adopted and a shareholder or director considers it void, the next step is a written legal assessment of the resolution, the articles of association and the resolution book, followed, where appropriate, by a claim for a declaration of nullity before the competent court. Lexin Legal advises foreign shareholders and directors on board procedure and on disputes arising from board resolutions.
Frequently asked questions
Can a board member attend a Turkish board meeting through a proxy?
No. Under TCC 390(2), board members cannot vote on behalf of one another and cannot attend meetings through a representative. If the articles of association provide for it, a member may attend electronically under TCC 1527(1), with the same quorums and subject to the electronic voting conditions of TCC 1527(3).
What is the quorum for a board meeting of a Turkish joint stock company?
Unless the articles contain a stricter rule, the board meets with the majority of the total number of members and decides with the majority of the members present (TCC 390(1)). The same rule applies to electronic meetings.
Is a board resolution signed by e-mail exchange valid?
A resolution without a meeting is possible only under TCC 390(4): no member asks for a meeting, a proposal in the form of a resolution is made to all members, and at least the majority of the total number of members approve it in writing; the signed approvals must be pasted into the resolution book or turned into a signed resolution entered in it. Under TCC 390(5), resolutions are valid only if written and signed.
What happens if the board vote is tied?
The matter is left to the next meeting. If the votes are equal again at the second meeting, the proposal is deemed rejected (TCC 390(3)). The TCC does not give the chair of a joint stock company board a casting vote.
The chair will not call a board meeting. What can the other members do?
Any member may ask the chair in writing to call the board. If the majority of the members request it in writing, the chair must call the board to a meeting within thirty days of receiving the request; if that does not happen, or the chair or the vice-chair cannot be reached, the requesting members may call the meeting themselves; the articles may provide a different procedure for calling the board (TCC 392(7), as amended in 2024).
Is there a deadline for asking the court to declare a board resolution void?
TCC 391 does not set a time limit and does not name who may bring the claim; standing in a particular case is assessed by the court. The 391 claim is a declaration of nullity; the annulment action with its own time limit in TCC 445 to 451 concerns general assembly resolutions, not board resolutions.
Can the board refuse to show a director the company's contracts?
A director's request that a book, contract, correspondence or document be brought before the board and examined cannot be refused (TCC 392(1)). Outside meetings, inspection requires the chair's permission; if the chair refuses, the matter goes to the board within two days and then, if the board does not meet or refuses, to the commercial court of first instance, whose decision is final (TCC 392(3)-(4)).
