Owning 20%, 30% or even 40% of a profitable company may look valuable on paper. In practice, however, a minority shareholder in a Turkish limited liability company may suddenly discover that the majority shareholder controls almost everything that matters.

The minority shareholder may stop receiving financial information. General meetings may be held without proper notice. Profits may never be distributed. The majority shareholder may appoint family members as managers, pay excessive salaries, transfer customers to another company, increase capital, reduce the minority shareholder’s percentage or attempt to remove the minority shareholder from the company entirely.

This situation is often described commercially as a shareholder squeeze-out, minority oppression or shareholder freeze-out.

Turkish law does not contain one single provision called “minority oppression.” Instead, the Turkish Commercial Code — Law No. 6102 (“TCC”) — provides several different remedies.

The correct strategy therefore depends on what the majority shareholder is actually doing.

The most important practical rule is this:

A majority shareholder does not acquire unlimited power merely because he or she controls more than 50% of the company.

Corporate majority must still be exercised within the limits of the law, the articles of association, good faith, shareholders’ individual rights and the company’s interests.

1. What Does “Excluding the Minority Shareholder” Mean?

A minority shareholder may be excluded in several different ways.

Typical examples include:

• preventing the shareholder from obtaining company accounts;
• excluding the shareholder from management;
• refusing access to financial records;
• holding general meetings without proper notice;
• refusing to distribute profits for years;
• paying excessive salaries to majority-controlled managers instead of distributing profits;
• transferring company assets to related persons;
• transferring customers to another company controlled by the majority;
• increasing capital to dilute the minority shareholder;
• restricting pre-emption rights;
• refusing to register or recognise shareholder rights;
• creating artificial debts;
• removing the minority shareholder as manager;
• attempting to remove the minority shareholder entirely from the company.

Each requires a different legal response.

2. Majority Ownership Is Not the Same as Absolute Control

The majority shareholder usually has significant influence over ordinary general assembly resolutions.

But this does not mean that the majority may disregard:

• mandatory provisions of the TCC;
• the articles of association;
• qualified voting requirements;
• individual shareholder rights;
• information rights;
• pre-emption rights;
• the duty of equal treatment;
• rules protecting company assets;
• managers’ duties of care and loyalty.

For limited liability companies, Article 627 TCC expressly provides that managers must treat shareholders equally under equal conditions.

Therefore, discrimination against a minority shareholder cannot automatically be justified by saying:

“We own the majority of the shares.”

3. The Majority Cannot Simply Remove a Minority Shareholder Because It Wants To

This is perhaps the most important point.

A shareholder cannot ordinarily be removed from a limited liability company simply because the majority no longer wishes to work with him or her.

Article 640 TCC establishes specific routes for expulsion.

The company’s articles of association may contain predetermined grounds permitting a shareholder to be removed by a general assembly resolution.

If such grounds exist, the general assembly may adopt an expulsion resolution under the statutory conditions.

The expelled shareholder may challenge that decision within three months following notification of the expulsion resolution through a notary.

Alternatively, a shareholder may be removed by a court for just cause upon the company’s request.

Accordingly, there is no general principle under Turkish company law allowing a 70% shareholder to say:

“I own 70%, you own 30%, therefore I am removing you.”

That is not sufficient.

4. Expulsion Requires a Qualified General Assembly Majority

Expulsion decisions are treated as important decisions under Article 621 TCC.

Among other matters, Article 621 covers:

• applying to court for the expulsion of a shareholder for just cause; and
• removing a shareholder based on a ground provided in the articles of association.

Such decisions generally require both:

at least two-thirds of the votes represented at the meeting

and

an absolute majority of the entire share capital carrying voting rights.

Furthermore, if grounds for shareholder expulsion are to be inserted into the articles of association after incorporation, Article 621/3 requires unanimous approval of all shareholders representing the company’s capital.

This rule is particularly important where the majority attempts to amend the articles after a shareholder dispute and then use the new provision against the minority.

5. Removing the Minority as Manager Is Not the Same as Removing the Minority as Shareholder

This distinction is frequently misunderstood.

A shareholder may simultaneously be:

• a shareholder;
• a manager;
• an authorised representative;
• an employee.

These are legally distinct positions.

Article 630 TCC allows the general assembly to remove managers or restrict their management and representation authority.

Therefore, a majority shareholder may in some circumstances be able to remove the minority shareholder from management.

But this does not automatically cancel the minority shareholder’s shares.

For example:

Ali owns 70%.

Mehmet owns 30%.

Both are managers.

Ali successfully passes a resolution removing Mehmet as manager.

The result may be:

Mehmet: no longer manager

but still:

Mehmet: 30% shareholder.

His shareholder rights continue.

These may include:

• voting rights;
• information rights;
• examination rights;
• financial rights;
• dividend rights;
• pre-emption rights;
• rights to challenge unlawful resolutions.

6. The First Weapon of an Excluded Shareholder: Information and Inspection Rights

Minority oppression frequently begins with information being withheld.

The majority shareholder or manager may say:

“You are not involved in management anymore, so you cannot see the accounts.”

For a shareholder, this is generally not a sufficient answer.

Article 614 TCC provides every shareholder with the right to request information from managers concerning all company affairs and accounts and to examine company matters.

This right belongs to each shareholder individually.

Therefore, it is not necessary to hold 10%, 20% or 30% of the capital merely to rely on Article 614.

A shareholder holding even a relatively small participation may invoke the statutory information right.

7. What Documents Can a Minority Shareholder Seek?

Depending on the circumstances, a shareholder may seek information concerning matters such as:

• company bank accounts;
• financial statements;
• trial balances;
• general ledgers;
• shareholder current accounts;
• company debts;
• company receivables;
• related-party transactions;
• property owned by the company;
• vehicles;
• major contracts;
• payments to managers;
• transactions with majority shareholders;
• dividend distributions;
• loans to related companies.

The exact scope depends on the particular request and the legitimate corporate interests involved.

The shareholder should therefore avoid vague requests such as:

“Give me every document.”

A more effective approach is often:

“Provide the bank statements for accounts X, Y and Z for the period January 2024–December 2025 and permit examination of the ledger entries concerning payments to Company B.”

Specific requests are easier to enforce and more useful in later litigation.

8. Can Management Refuse to Provide Information?

Yes, but not merely because the shareholder is unpopular.

Article 614/2 provides that managers may restrict access to the extent necessary where there is a danger that the shareholder will use the information to the company’s detriment.

If management refuses information on that ground, the shareholder may refer the matter to the general assembly.

If the general assembly wrongfully refuses the request, the shareholder may apply to court, whose decision under Article 614/3 is final.

Therefore, a majority-controlled general assembly cannot permanently neutralise the information right merely by repeatedly voting “no.”

9. Always Create Written Evidence of Information Requests

One of the most important practical mistakes is making requests only orally.

Statements such as:

“I asked the accountant many times.”

are considerably weaker than documentary evidence.

Where a serious shareholder dispute exists, requests should ordinarily be documented.

Depending on the circumstances, this may involve:

• notarised notices;
• registered electronic mail;
• corporate correspondence;
• written general assembly requests.

The objective is to create a chronology demonstrating:

1. what information was requested;
2. when it was requested;
3. whether the company responded;
4. what justification was given for refusal.

This evidence may later become significant in information proceedings, special audit proceedings, manager-liability litigation or just-cause exit/dissolution proceedings.

10. The Minority Can Force Corporate Issues Onto the Agenda

The majority may attempt to avoid accountability simply by refusing to convene the general assembly.

Article 617/3 TCC makes the rules governing minority calls and agenda requests in joint-stock companies applicable by analogy to limited liability companies.

Under Articles 411 and 412, shareholders representing at least 10% of the capital may, subject to the statutory conditions, request that the general assembly be convened or that matters be included on the agenda.

The request should identify the reasons and proposed agenda.

If the request is rejected or not positively answered within the statutory period, an application may be made to the commercial court for authorisation to convene the meeting. Courts may appoint a person to arrange and conduct the call where appropriate.

For a shareholder holding 10% or more, this can be a powerful procedural tool.

11. An Unlawful General Assembly Resolution Can Be Challenged

Majority shareholders frequently attempt to implement exclusion through general assembly resolutions.

Examples include:

• unlawful capital increases;
• invalid restrictions on pre-emption rights;
• improper expulsion resolutions;
• unlawful amendments to the articles;
• approvals of related-party transactions;
• resolutions taken after defective notice.

Article 622 TCC expressly makes the provisions governing annulment and nullity of joint-stock company general assembly resolutions applicable to limited liability companies.

Under Article 445, resolutions contrary to:

• the law;
• the articles of association; or
• particularly the principle of good faith

may be challenged by an action for annulment.

The general deadline is three months from the date of the resolution.

This deadline should be treated extremely seriously.

12. If You Attend the Meeting, Record Your Opposition

Procedural details can decide the entire case.

A shareholder who attends the general assembly and intends to bring an annulment action should generally:

1. vote against the resolution; and
2. ensure that the opposition is recorded in the minutes.

Article 446 specifically recognises standing for a shareholder who attends, votes against the resolution and records his or her opposition in the meeting minutes.

The Court of Cassation continues to treat this requirement seriously.

In its decision dated 4 February 2026, 11th Civil Chamber, E. 2025/3422, K. 2026/714, the Court considered the absence of a recorded opposition as a special procedural deficiency in an annulment action concerning a limited liability company’s general assembly resolution.

Therefore:

Do not simply vote “no.” Make sure the objection appears in the minutes.

13. Improperly Calling the General Assembly Can Also Create a Right of Action

A minority shareholder may not even be invited.

Article 446 additionally protects shareholders where, among other circumstances:

• the meeting was not properly called;
• the agenda was not properly announced;
• an unauthorised person attended and voted;
• the shareholder was wrongfully prevented from attending or voting;

provided the relevant irregularity affected adoption of the resolution.

Therefore, the majority cannot necessarily avoid judicial scrutiny by simply excluding the minority from the meeting.

14. Some General Assembly Resolutions May Be Null

Certain defects are more serious than ordinary annulment grounds.

Article 447 includes resolutions that, in particular:

• eliminate or restrict indispensable shareholder rights;
• improperly restrict information, examination or audit rights;
• violate fundamental corporate structure or capital-protection principles.

Article 622 extends these principles to limited liability companies.

The distinction between:

annullability, nullity and non-existence

can have major procedural consequences and should therefore be analysed before choosing the claim.

15. Capital Increase Is a Classic Minority Squeeze-Out Technique

One of the most powerful methods of weakening a minority shareholder is dilution.

Example:

Majority shareholder: 80%

Minority shareholder: 20%

The company increases its capital dramatically.

The minority shareholder cannot financially participate.

After the transaction, the minority’s effective ownership may fall to a fraction of its previous percentage.

However, Turkish law contains several safeguards.

First, a capital increase is an important resolution falling within Article 621 and therefore requires the statutory qualified majority.

Second, Article 591 provides shareholders with a pre-emption right proportional to their shareholding unless otherwise lawfully provided.

More importantly, a shareholder’s pre-emption right may be restricted or removed only for just cause and with the qualified majority required under Article 621. The provision also prohibits unjustifiably benefiting one person or disadvantaging another through the restriction.

16. Yargıtay Has Recently Addressed Dilution Designed to Harm the Minority

A particularly useful recent decision concerns precisely this problem.

In Court of Cassation 11th Civil Chamber, E. 2024/6754, K. 2025/4213, dated 17 June 2025, minority shareholders challenged a capital increase after alleging that they had not been properly called to the general assembly and that their ownership percentage had been reduced from approximately 10% to approximately 0.29%.

The lower courts accepted the challenge, finding deficiencies in the meeting notice and determining that the transaction had a character contrary to good faith and harmful to the minority. The Court of Cassation upheld the result.

This decision is highly significant in practice.

A capital increase cannot safely be used merely as an instrument to economically eliminate a minority shareholder.

17. Refusing to Distribute Profit Can Also Constitute Minority Oppression

Another common strategy is not to take the minority’s shares but to make those shares economically worthless.

Imagine a company that earns substantial profits every year.

The majority shareholder controls management and receives:

• a large management salary;
• company vehicle;
• travel expenses;
• consultancy payments through a related company.

The minority shareholder receives:

zero dividends.

If this continues for many years, the majority effectively obtains the financial benefits of the business while the minority’s shares produce no cash return.

Not every decision not to distribute profits is unlawful.

Companies may legitimately retain earnings for:

• investments;
• debt repayment;
• working capital;
• expansion;
• financial stability.

However, systematic refusal to distribute profits combined with private benefits provided to the majority can form part of a broader pattern of shareholder oppression.

The Court of Cassation and legal literature treat persistent profit-distribution conflicts, restriction of information rights and breakdown of shareholder relations as factors potentially relevant to just-cause remedies depending on the particular facts.

18. Special Audit: The Minority Shareholder’s Forensic Tool

Sometimes obtaining the accounting records is not enough.

The documents may reveal transactions requiring independent investigation.

Examples:

• TRY 20 million transferred to the majority shareholder;
• property sold to a relative;
• unusual consultancy invoices;
• loans given to affiliated companies;
• customer contracts moved to another business.

Article 635 TCC makes the provisions concerning special audits applicable to limited liability companies.

Under Article 438, a shareholder may request a special audit concerning specific matters where this is necessary to exercise shareholder rights and the information or inspection right has previously been used.

The special audit therefore works particularly well when the shareholder can say:

“I requested information, the information was inadequate, and this specific transaction now requires independent investigation.”

19. What If the Majority Rejects the Special Audit?

This is where the remedy becomes particularly useful.

If the general assembly rejects the special-audit request, shareholders meeting the statutory threshold may apply to the commercial court within three months.

Article 439 refers to shareholders representing at least:

• 10% of the capital; or
• shares having the statutorily specified aggregate nominal value.

The applicants must plausibly demonstrate that founders or corporate organs violated the law or articles and thereby caused damage to the company or shareholders.

Because Article 635 applies the special-audit regime to limited liability companies, this can provide minority shareholders with an important independent investigative mechanism.

20. Majority-Controlled Managers Can Face Personal Liability

Sometimes the problem is not merely an unlawful general assembly resolution.

The managers may actually be harming the company.

Examples include:

• transferring company money to themselves;
• selling assets below market value;
• diverting business to their own companies;
• paying fictitious invoices;
• providing improper benefits to relatives;
• using company property personally;
• causing the company to enter disadvantageous related-party transactions.

Article 626 requires managers to perform their duties with due care and to protect the company’s interests in accordance with good faith.

Through Article 644, the manager-liability provisions contained in Articles 553 et seq. apply to limited liability companies. Managers who culpably breach duties arising from law or the articles may therefore incur liability.

21. A Minority Shareholder May Bring a Liability Action

This remedy can be extremely important.

Under the liability framework, shareholders may in appropriate circumstances pursue damages resulting from managers’ unlawful conduct.

A distinction must, however, be made between:

Direct shareholder damage

and

Damage suffered by the company, which indirectly reduces the shareholder’s investment.

Where the loss belongs directly to the company, Article 555 generally allows a shareholder to bring the action but requires the compensation to be paid to the company, rather than directly to the suing shareholder.

A recent Court of Cassation decision also confirms that a shareholder’s own action against a manager is not necessarily dependent upon a prior general assembly resolution. Court of Cassation 11th Civil Chamber, E. 2024/6095, K. 2025/5476, dated 18 September 2025, emphasised this distinction in a limited liability company dispute.

22. What If the Majority Shareholder Is Also the Manager?

This is common in Turkish family businesses.

Example:

Majority shareholder: 70%

Minority shareholder: 30%

Majority shareholder is also sole manager.

The manager:

• refuses financial information;
• pays himself excessive compensation;
• transfers company resources;
• enters transactions with his own second company.

The minority shareholder does not necessarily have to wait for the majority-controlled general assembly to remove the manager.

Article 630/2 allows each shareholder, where just cause exists, to ask the court to remove or restrict a manager’s management and representation powers.

Serious breaches of duties, including significant violations of the duty of care or loyalty, may constitute just cause.

23. The Nuclear Option: Just-Cause Dissolution Under Article 636/3

Sometimes the relationship cannot realistically be repaired.

Article 636/3 provides one of the strongest protections available to a limited company shareholder:

Every shareholder may request dissolution of the company where just cause exists.

Importantly, this right is available to every shareholder.

The provision does not require a 10% or 20% minimum shareholding threshold.

However, dissolution is not necessarily the only possible outcome.

The court may instead:

• order that the claimant shareholder be paid the real value of his or her shares and removed from the company; or
• impose another appropriate and acceptable solution.

This gives the commercial court significant flexibility.

24. What Can Constitute “Just Cause”?

The legislation does not provide an exhaustive list for Article 636/3.

The assessment depends on the facts of the company.

Potentially relevant circumstances may include:

• serious and continuing breaches of shareholder rights;
• systematic denial of information;
• diversion of company assets;
• major breaches of managers’ duties;
• persistent corporate deadlock;
• destruction of the necessary relationship of trust;
• systematic exclusion of a shareholder;
• severe misuse of majority power;
• long-term financial oppression.

Not every disagreement qualifies.

Ordinary personality conflicts or isolated disputes will generally not justify the most severe remedy.

The focus should be on whether the relationship has deteriorated to such an extent that continued participation has become objectively intolerable or the company’s proper functioning has been seriously affected.

25. A Recent Court of Cassation Decision Shows the Court’s Flexibility

Court of Cassation 11th Civil Chamber, E. 2025/5774, K. 2025/7408, addressed a serious conflict in a limited liability company.

The Court emphasised that destruction of the necessary trust relationship can amount to just cause, but also highlighted the principle of maintaining a functioning company where possible.

Rather than automatically dissolving a viable company, an appropriate solution may involve one shareholder leaving upon payment of the real value of the shares.

This demonstrates an important practical principle:

The purpose of Article 636/3 is not necessarily to destroy the business. It is to resolve an intolerable shareholder relationship fairly.

26. The Court Can Take Interim Measures

Article 636/4 expressly allows the court, upon request, to take necessary measures after a dissolution action has been filed.

This can be extremely important.

Imagine a minority shareholder filing suit while the majority is simultaneously:

• selling company real estate;
• transferring bank funds;
• disposing of vehicles;
• moving customers to another company.

A judgment two years later may be economically meaningless if the company has already been emptied.

Therefore, depending on the facts, counsel should immediately consider whether interim protection is necessary.

The exact measure must be proportionate to the dispute and supported by evidence.

27. The “Real Value” of the Minority Share Matters

Where the appropriate solution is for one shareholder to leave, valuation becomes critical.

A majority shareholder may argue:

“Your 20% share has a nominal value of TRY 200,000, so we will pay TRY 200,000.”

That approach may be completely wrong.

The relevant issue may be the real economic value of the shares rather than merely registered or nominal capital.

The company’s:

• real estate;
• machinery;
• bank deposits;
• investments;
• receivables;
• profitability;
• goodwill;
• customer portfolio;
• business prospects;
• hidden reserves

may all affect value.

A minority shareholder should therefore never agree to a buyout merely on the basis of nominal capital without an independent valuation.

28. Beware of the Majority Emptying the Company Before the Share Valuation

This creates another serious risk.

The majority may realise that litigation could result in buying out the minority at real value.

It may therefore attempt to reduce that value by:

• transferring cash;
• selling property cheaply;
• increasing liabilities;
• paying excessive management salaries;
• transferring customers;
• establishing a competing related company.

This type of conduct should be documented immediately.

Recent Court of Cassation practice continues to emphasise that where Article 636/3 is used to resolve a serious shareholder conflict through a buyout mechanism, determination of the relevant real share value becomes a central component of the remedy.

29. A Practical Litigation Strategy for the Minority Shareholder

A well-structured minority oppression dispute should generally proceed in stages.

Stage 1 — Secure the Corporate Documents

Obtain:

• articles of association;
• trade registry records;
• shareholder structure;
• manager appointments;
• historical amendments;
• general assembly records.

Stage 2 — Use Article 614

Send a detailed information and inspection request.

Do not merely request:

“All accounts.”

Identify specific transactions, periods and records.

Stage 3 — Protect General Assembly Rights

Attend meetings where possible.

Vote against unlawful resolutions.

Have opposition recorded.

Preserve:

• call notices;
• meeting agendas;
• meeting minutes;
• attendance lists;
• resolutions.

Stage 4 — Watch the Three-Month Deadline

Where a resolution is subject to annulment, Article 445’s three-month period may determine whether the claim survives.

Never assume negotiations with the majority suspend that period.

Stage 5 — Investigate Financial Irregularities

Review:

• bank transactions;
• related-party accounts;
• management remuneration;
• shareholder current accounts;
• property transfers;
• affiliated companies.

Stage 6 — Consider Special Audit

If specific suspicious matters require independent investigation, use the information right and then evaluate Articles 438–440 through Article 635.

Stage 7 — Consider Manager Liability

If the company has suffered financial loss because of the controlling manager’s conduct, evaluate Articles 553 and 555.

Stage 8 — Consider Removing the Manager

Where the controlling shareholder is also the manager and there is serious misconduct, Article 630 may provide a judicial remedy.

Stage 9 — Consider Article 636/3

If continued partnership has genuinely become impossible, a just-cause dissolution action — combined with requests for an alternative solution and interim measures — may provide the ultimate remedy.

30. Conclusion: The Majority Can Control the Vote, But It Cannot Own the Law

A minority shareholder in a Turkish limited liability company can be commercially vulnerable.

The majority often controls:

• ordinary voting;
• management appointments;
• day-to-day operations;
• access to accountants;
• relationships with banks and customers.

But the majority’s power has legal limits.

A shareholder who is systematically frozen out may have access to a combination of remedies involving:

information and inspection rights,

minority rights to call the general assembly,

annulment or nullity proceedings,

pre-emption protection against dilution,

special audit,

manager-liability litigation,

judicial removal or restriction of managers,

and ultimately:

just-cause dissolution or a court-ordered exit based on the real value of the shares.

The most effective strategy is rarely to immediately file a single broad lawsuit alleging:

“The majority shareholder is treating me unfairly.”

Instead, the minority shareholder should create a documentary record showing precisely how the exclusion is occurring.

In shareholder litigation, the strongest case is usually built by transforming a general complaint of oppression into a sequence of identifiable corporate-law violations.