Introduction: How Can a Foreign Shareholder Exit a Turkish Company?

A foreign investor entering a Turkish company usually spends significant time negotiating how to invest.

Far less attention is sometimes given to an equally important question:

How will the investor eventually get out?

An investment may end for many reasons.

The company may become highly successful and attract a strategic buyer. The foreign investor may reach the end of its investment period. A private equity fund may need to realise its return. The investor may disagree with the Turkish founder about future strategy. A multinational group may decide to leave a particular market. A minority investor may want liquidity while the controlling shareholder wants to continue operating the business.

Whatever the reason, a foreign investor generally exits a Turkish company by selling or otherwise transferring its shares, although other exit mechanisms such as redemption, contractual put options, corporate restructuring, liquidation or a sale of the entire business may also be relevant depending on the structure.

Turkey’s foreign direct investment regime is based on equal treatment. International investors generally have the same rights and liabilities as local investors concerning company formation and share transfers. Turkey’s official Investment Office expressly confirms that the conditions governing the transfer of shares are generally the same for international and domestic investors.

The Foreign Direct Investment Law also protects an important aspect of the exit process: foreign investors may transfer abroad the proceeds from the sale or liquidation of all or part of an investment through banks or financial institutions, together with other categories such as net profits and dividends.

This does not mean, however, that a foreign shareholder can always sell to anyone at any time.

The exit process may be affected by the company’s legal form, articles of association, shareholders’ agreement, share class, transfer restrictions, pre-emption rights, rights of first refusal, tag-along or drag-along provisions, regulatory approvals, Competition Authority requirements and taxation.

The rules also differ significantly between a Turkish joint stock company — Anonim Şirket (A.Ş.) and a Turkish limited liability company — Limited Şirket (Ltd. Şti.).

For this reason, the foreign investor’s exit strategy should ideally be designed when the investment is made, not when the investor has already decided to leave.

1. The First Question Is Not “Who Will Buy My Shares?” but “Am I Free to Sell Them?”

Before approaching a buyer, the foreign shareholder should review the legal documents governing the investment.

The most important documents normally include the company’s articles of association, the shareholders’ agreement, investment agreement, previous share purchase or subscription agreement, share certificates where applicable, corporate records and any side letters affecting shareholder rights.

A foreign investor may discover that what appears to be a straightforward sale is subject to contractual or corporate restrictions.

For example, a shareholders’ agreement might require that the investor first offer the shares to the existing shareholders.

It might prohibit sales to competitors.

It might contain a three-year lock-up.

It might require the consent of another shareholder.

It might give other shareholders a right of first refusal.

It might allow minority shareholders to join the transaction through a tag-along right.

A controlling shareholder may even have a drag-along mechanism allowing or requiring a broader exit in certain circumstances.

Accordingly, the sale process should begin with a transferability review.

Approaching an outside purchaser and signing an unconditional sale agreement before checking existing restrictions can place the foreign investor in breach of contract.

2. A.Ş. and Ltd. Şti. Shares Do Not Follow the Same Transfer Rules

This distinction is central to Turkish exit planning.

A Turkish A.Ş. is generally designed to permit greater share-transfer flexibility.

Article 490 of the Turkish Commercial Code provides the basic rule that registered shares are freely transferable unless the law or articles of association provide otherwise. Where registered share certificates have been issued, a legal transfer may be effected through endorsement of the registered share certificate and transfer of possession to the purchaser.

However, an A.Ş. may impose restrictions through its articles.

Article 492 expressly allows the articles to provide that registered shares may be transferred only with company approval. The Commercial Code also contains specific rules governing when approval can be refused, particularly for non-listed companies and unpaid registered shares.

An Ltd. Şti. is considerably more formal.

Under Article 595, the transfer of an Ltd. Şti. capital share and the agreement creating the obligation to transfer must be made in writing and the parties’ signatures must be notarised. Unless the company agreement provides otherwise, approval of the general assembly is required, and the transfer becomes valid with that approval. The general assembly may ordinarily refuse approval without giving a reason unless the company agreement provides differently, and the company agreement may even prohibit the transfer. If the general assembly does not reject the application within three months, approval is deemed granted.

For a foreign investor, this means that the legal form selected on entry can significantly affect the ease of exit years later.

3. How Does a Foreign Investor Sell Shares in a Turkish A.Ş.?

An A.Ş. exit usually begins by determining the form and status of the shares.

The investor should establish whether the shares are registered, bearer or uncertificated, whether certificates have been issued, whether the share price has been fully paid and whether the articles impose restrictions on transfer.

For registered shares, the general principle is free transferability, subject to statutory and articles-based restrictions.

The buyer should then be recognised appropriately in the company’s share records.

Article 499 provides that owners of uncertificated shares and registered share certificates are entered in the share ledger. Importantly, in relations with the company, the person registered in the share ledger is treated as the shareholder.

Therefore, a foreign seller should not view signing the Share Purchase Agreement as the final step.

The closing process should ensure that ownership and the relevant corporate records are properly transferred.

Where bearer shares are involved, the current MKK notification framework must also be observed; Turkish law now links the ability to assert bearer-share rights against the company and third parties to the relevant notification to the Central Securities Depository.

4. How Does a Foreign Investor Sell Shares in a Turkish Ltd. Şti.?

An Ltd. Şti. exit involves greater formalities.

Article 595 requires the transfer agreement to be written and the signatures to be notarised. If the company agreement does not remove the requirement, the general assembly must approve the transfer.

The company’s managers must then apply to the Trade Registry for registration of the transfer of the capital share. Article 598 specifically requires the managers to apply for registration; if the application is not made within 30 days, the departing shareholder may itself apply to have its name removed in relation to the transferred shares.

The company must also maintain its share ledger. Article 594 requires information concerning shareholders and transfers of capital shares to be recorded in that ledger.

For companies newly registered from 1 January 2026, the share ledger and general assembly meeting and negotiation book are maintained electronically through Turkey’s Electronic Commercial Book System — ETDS.

Accordingly, a 2026 Ltd. Şti. exit can require coordination among the seller, buyer, notary, general assembly, company management, Trade Registry, share records and E-TUYS compliance.

5. Can the Other Shareholders Prevent a Foreign Investor From Selling an Ltd. Şti. Interest?

Potentially, yes.

This is a major difference from the ordinary free-transfer principle in an A.Ş.

Unless the Ltd. Şti. company agreement provides otherwise, the transfer requires general assembly approval and the general assembly may ordinarily refuse approval without giving reasons. The articles may even prohibit transfer.

However, Turkish law does not leave the shareholder completely without protection.

Article 595 preserves the shareholder’s right to seek withdrawal from the company for just cause where the company agreement prohibits transfer or the general assembly refuses approval.

This does not mean that every rejected sale automatically allows immediate withdrawal on the investor’s preferred commercial terms.

It does mean that foreign investors considering an Ltd. Şti. should analyse exit restrictions before investing.

For long-term investment transactions, the ability to exit should be negotiated contractually rather than left entirely to the default approval regime.

6. Why a Shareholders’ Agreement Can Determine Whether an Exit Is Easy or Difficult

A shareholders’ agreement often contains the real commercial exit architecture.

When an investor enters a company, the parties should ideally determine what happens if one of them later wants to sell.

A carefully structured SHA can address whether shares can be transferred freely, whether transfers are subject to a lock-up period, whether sales to competitors are prohibited, whether shareholders receive pre-emption or first-refusal rights, whether a controlling shareholder can drag minority investors into a company sale and whether minority shareholders can tag along when control changes.

These clauses can turn an uncertain future negotiation into a predictable contractual process.

Without an exit framework, an investor wishing to sell a minority position may discover that there is no liquid market for its shares and the controlling shareholder has no obligation to buy.

That is one reason exit rights should be negotiated before the investor’s capital is committed.

7. What Is a Right of First Refusal?

A Right of First Refusal, commonly abbreviated as ROFR, gives another shareholder an opportunity to purchase shares after the selling shareholder receives a genuine offer from an outside purchaser.

For example, a foreign investor receives an offer of EUR 8 million for its 30% interest.

Before selling to the third party, the investor may be required to present those commercial terms to the Turkish founder.

The founder then has a defined period in which to purchase on the same or contractually equivalent terms.

If the founder declines, the foreign investor can generally proceed with the external buyer subject to the detailed agreement.

A ROFR can protect existing shareholders against being forced into partnership with an unknown third party.

From the seller’s perspective, however, it can make an external sale less attractive because buyers may be unwilling to spend significant time and money on due diligence merely to establish a price that an existing shareholder can match.

The drafting therefore needs to balance liquidity and shareholder stability.

8. What Is a Right of First Offer?

A Right of First Offer — ROFO — operates differently.

The seller first approaches the existing shareholder and gives that shareholder an opportunity to make an offer before formally marketing the shares elsewhere.

If the parties fail to agree, the seller may then approach third parties, usually subject to contractual parameters.

This can sometimes be commercially easier for a foreign seller than a ROFR because an outside buyer does not necessarily spend resources only to have its offer matched at the last moment.

Whether ROFR or ROFO is better depends on the negotiating position and objectives of the shareholders.

9. Pre-emption Rights and Share-Transfer Rights Should Not Be Confused

The term “pre-emption” can be used in different contexts.

A shareholder’s right to participate in newly issued shares during a capital increase is different from a contractual right to acquire existing shares being sold by another shareholder.

These concepts should be drafted separately.

For exit planning, the relevant question is whether an existing shareholder has priority over a third-party purchaser of the departing investor’s shares.

For dilution protection, the issue is whether the shareholder can maintain its percentage when the company issues additional capital.

Confusing the two can lead to serious contractual ambiguity.

10. Tag-Along Rights Are Particularly Important for Foreign Minority Investors

A minority foreign investor may not control when the company is sold.

Suppose:

Turkish Founder: 70%

Foreign Investor: 30%

A multinational company offers to purchase the founder’s 70%.

If the foreign investor has no tag-along right, it may remain as a 30% minority shareholder alongside a new controlling owner that it never chose.

A tag-along right can allow the foreign investor to participate in the controlling shareholder’s sale, usually on the same or economically equivalent terms.

The clause should specify the trigger, percentage eligible to tag, valuation, payment terms, transaction costs, warranty obligations and timing.

A minority foreign investor seeking eventual liquidity should normally analyse tag-along protection before completing the original investment.

11. Drag-Along Rights Can Facilitate a Full Company Sale

Drag-along rights solve the opposite problem.

Suppose a foreign investor owns 80% of a Turkish technology company and a strategic buyer wants to acquire 100%.

The remaining 20% shareholder refuses to sell.

The buyer may walk away because it does not want minority shareholders.

A properly structured drag-along provision can allow the qualifying majority to require minority shareholders to sell as part of the same transaction, usually subject to protections concerning price and terms.

A drag mechanism can therefore materially increase the company’s saleability.

But the threshold must be negotiated carefully.

A 51% shareholder should not automatically have the same drag power as an investor holding 90% unless that commercial outcome was consciously agreed.

12. Put Options Can Give a Foreign Investor a Contractual Exit Route

For some investments, especially joint ventures, a foreign investor may negotiate a put option.

A put option may allow the foreign shareholder to require another shareholder to purchase its shares when specified conditions occur.

Typical triggers can include a defined investment period expiring, material breach, deadlock, change of control, regulatory failure or another negotiated event.

The crucial issues are the trigger, valuation formula, payment terms, funding capacity of the buyer and enforceability.

A put option against a shareholder with no money is of limited practical value.

For that reason, substantial investments may require security such as a parent guarantee, escrow, bank support or another mechanism where commercially possible.

13. Call Options Can Also Form Part of the Exit Structure

A call option allows one party to require the other to sell its shares under specified conditions.

It can be relevant where a local partner breaches key obligations or where the foreign investor intends to acquire full ownership after an initial joint venture period.

Put and call rights are particularly common in sophisticated investment structures because they create a predetermined exit path without requiring the parties to negotiate from zero during a dispute.

However, valuation and Turkish-law implementation should be considered carefully.

A clause saying simply “the shares will be bought at fair market value” may still produce years of disagreement over what “fair market value” means.

A properly drafted option should contain a workable valuation mechanism.

14. What Happens if the Shareholders Cannot Agree on the Price?

Valuation is one of the most difficult exit issues in private companies.

Unlike publicly traded shares, there may be no daily market price.

Potential valuation methods can include EBITDA multiples, discounted cash flow, independent expert valuation, recent financing rounds or a formula negotiated in the SHA.

The correct method depends heavily on the business.

A revenue multiple may make sense for one technology company and be meaningless for a manufacturing business.

The agreement should also define whether the company is valued on a:

cash-free/debt-free basis, enterprise value basis or equity value basis.

Working capital adjustments may also matter.

Exit drafting should therefore involve commercial and financial advisers as well as lawyers.

15. Should the Foreign Investor Sell Only Its Shares or the Entire Company?

A minority shareholder may initially intend to sell only its own stake.

But a strategic buyer may value the company much more highly if it can acquire control or 100%.

This is where tag, drag and shareholder coordination become critical.

For example, a foreign investor with 40% may receive an attractive offer conditioned upon the Turkish founder selling its 60%.

Without contractual cooperation obligations, the foreign shareholder cannot force the founder to participate.

Similarly, the controlling shareholder might find a 100% buyer but lack a drag right.

An effective exit strategy therefore looks beyond the investor’s own shares and considers how a future sale of the entire company would work.

16. Do Regulatory Approvals Apply When the Foreign Investor Sells?

They can.

Turkey’s foreign investment regime generally does not impose a general government approval requirement simply because a foreign investor transfers its shares. Turkey moved from an approval-based FDI framework to a notification-based system, while regulated sectors remain subject to their own rules.

However, if the target operates in a regulated sector, a change in shareholding or control may require consent or notification to the competent regulator.

This can be relevant in areas such as banking, insurance, payment services, capital markets, energy, broadcasting and other licensed activities.

A foreign investor should therefore review the target’s operating licences before signing an unconditional Share Purchase Agreement.

The correct transaction structure may require regulatory approval to be included as a condition precedent to closing.

17. Competition Authority Approval May Be Required When the Investor Exits

A share sale can also fall within Turkish merger-control rules where it creates a lasting change of control and the applicable turnover thresholds are satisfied.

Turkey materially revised its merger-control thresholds in February 2026.

The Competition Authority increased the former TRY 250 million individual threshold to TRY 1 billion, the former TRY 750 million Turkish turnover threshold to TRY 3 billion, and the former TRY 3 billion worldwide threshold to TRY 9 billion. The 2026 amendments also modified aspects of the technology-undertaking regime and merger-control procedure.

The Authority updated its merger and control guidelines in May 2026 to reflect the revised framework.

Therefore, if a foreign shareholder sells a controlling interest in a significant Turkish company, the parties should perform a Turkish merger-control analysis before closing.

This requirement can apply even when both seller and buyer are foreign companies if the Turkish turnover and control tests are satisfied.

18. Selling a Minority Interest Can Still Create a Competition-Law Issue

The transaction does not necessarily need to involve 51% or 100%.

A minority purchaser can obtain joint control if the shares are accompanied by strategic veto rights or other rights that permit decisive influence over the company’s commercial strategy.

Accordingly, the exit analysis should review not only the percentage sold but also:

the rights being transferred to the purchaser.

A buyer receiving 30% together with veto rights over the budget, business plan, senior management and major investments may raise a very different control analysis from a passive 30% financial investment.

This is especially important where the outgoing foreign investor transfers its entire governance package to the incoming shareholder.

19. E-TUYS Must Be Considered When Foreign Ownership Changes

Foreign-invested Turkish companies are subject to electronic reporting through E-TUYS — the Electronic Incentive Application and Foreign Investment Information System.

Turkey’s official Investment Office identifies three principal foreign-investment information forms:

FDI Activity Information, FDI Capital Data and FDI Share Transfer Data.

Accordingly, a foreign investor’s exit can trigger an E-TUYS update where the transaction changes foreign ownership information.

This may occur where:

a foreign shareholder sells to another foreign shareholder;

a foreign investor sells to a Turkish purchaser;

foreign ownership falls;

or a new foreign investor enters.

E-TUYS should therefore appear on the post-closing checklist rather than being treated as something separate from the transaction.

20. ETDS Makes Accurate Share Records Even More Important in 2026

Turkey’s electronic corporate-book regime has become increasingly important.

The Ministry of Trade confirms that all companies registered from 1 January 2026 must maintain their share ledger and general assembly meeting and negotiation book electronically through ETDS.

For a foreign investor exiting such a company, the closing process should ensure that the electronically maintained corporate records accurately reflect the ownership change.

A signed SPA alone does not complete every corporate housekeeping requirement.

The seller should obtain evidence that the post-closing records no longer show it as shareholder where the relevant transfer has been completed.

21. How Is the Share Sale Price Paid to the Foreign Investor?

The share purchase agreement should specify:

the currency, payment date, bank account, conditions to payment, escrow arrangements, purchase-price adjustment mechanism and treatment of any deferred consideration.

For larger transactions, payment may be tied closely to the legal completion of the transfer.

A foreign seller should avoid a structure where it permanently transfers shares while payment remains unsecured.

Conversely, the buyer may not wish to transfer the full purchase price before receiving valid title to the shares.

This is why professional M&A transactions organise closing as a coordinated exchange:

share transfer against payment, together with delivery of all relevant corporate documents.

Escrow can be used where simultaneous performance is difficult.

22. Can the Foreign Investor Transfer the Sale Proceeds Abroad?

Yes, subject to compliance with the applicable tax, banking, anti-money-laundering and transaction documentation requirements.

Article 3 of the Foreign Direct Investment Law expressly provides that foreign investors may freely transfer abroad proceeds from the sale or liquidation of all or part of an investment through banks or special financial institutions.

This is an important legal protection.

A foreign investor does not generally need to leave the proceeds of a Turkish share sale permanently in Turkey merely because the investment was made through a Turkish company.

Banks may, however, request documentation concerning:

the share sale agreement, source of funds, tax status, corporate authorisations and the parties.

The repatriation process should therefore be coordinated with the transaction’s banking and tax advisers.

23. Tax Must Be Analysed Before the Sale Price Is Finalised

The taxation of a share exit can vary significantly according to:

• whether the seller is an individual or company;
• whether it is Turkish resident or non-resident;
• whether the target is an A.Ş. or Ltd. Şti.;
• whether A.Ş. shares are represented by qualifying share certificates;
• holding period;
• the seller’s original acquisition cost;
• and the applicable double taxation treaty.

The tax analysis should therefore be completed before the sale contract is signed.

A EUR 10 million gross sale price does not necessarily mean EUR 10 million of net proceeds.

24. Taxation of an Individual Shareholder Can Depend on the Type of Shares

The Turkish Revenue Administration treats certain gains from disposal of shares and partnership rights as capital appreciation gains.

Current GİB guidance confirms that the disposal of partnership rights or interests falls within the capital-gains framework. For 2026, the general annual capital-appreciation exemption is TRY 150,000 for qualifying categories, although that exemption does not apply to gains from securities and other capital-market instruments.

An important distinction exists for qualifying share certificates of fully taxable Turkish companies.

Under the Income Tax Law, qualifying shares of fully taxable companies that have been held for more than two years can fall outside the relevant capital-appreciation taxation rule, subject to the statutory conditions.

Ltd. Şti. partnership interests do not automatically receive the same treatment merely because they have been held for two years. GİB guidance has specifically distinguished the disposal of limited-company interests from qualifying A.Ş. share certificates.

For a non-resident foreign individual, the domestic-law analysis must then be considered together with the applicable double taxation treaty and filing rules.

25. Corporate Sellers Need a Different Tax Analysis

Where the seller is a corporate entity, the applicable rules are different.

For a Turkish corporate taxpayer holding qualifying participation shares, the Corporate Tax Law currently provides that 50% of the gain from the sale of qualifying participation shares held for at least two full years may be exempt from corporate tax when the statutory conditions are satisfied. The current 50% rate reflects the reduction introduced by Presidential Decision No. 9160. The law also requires, among other matters, compliance with conditions concerning retention of the exempt amount and collection of the sale price within the prescribed period.

That rule should not be mechanically applied to every foreign corporate shareholder.

A non-resident foreign company selling shares in a Turkish target requires a separate analysis of Turkish domestic tax rules, the jurisdiction of the seller, permanent establishment issues where relevant and the applicable double taxation treaty.

The legal and tax structure of the exit should therefore be modelled together.

26. Double Taxation Treaties Can Be Critical for Foreign Sellers

Turkey has an extensive network of double taxation treaties.

For a foreign seller, the treaty between Turkey and the seller’s country of tax residence can affect which country has the right to tax a capital gain.

Treaty provisions can differ depending on matters such as:

whether the target company’s value is principally derived from real estate;

the percentage held;

the holding period;

and the nature of the seller.

Therefore, it is risky to answer:

“How much tax will a foreign shareholder pay when selling a Turkish company?”

without knowing the seller’s jurisdiction and target structure.

Two investors selling identical percentages in the same Turkish company may face different final tax outcomes because they are resident in different treaty jurisdictions.

27. Real-Estate-Rich Companies Require Special Tax Attention

Foreign investors sometimes attempt to sell shares in a Turkish company rather than sell the underlying real estate directly.

This can have commercial advantages, but tax treaties frequently contain special provisions allowing the country in which the property is situated to tax gains from companies whose value is principally derived from immovable property.

Therefore, an investor exiting a Turkish real-estate company should not assume that a share sale automatically converts a Turkish property gain into a tax-free offshore transaction.

The applicable treaty and company balance sheet should be reviewed carefully.

28. What Should Be Included in the Share Purchase Agreement?

A professionally drafted exit SPA should do much more than state that the seller sells and the buyer buys.

It should determine exactly what is being transferred, at what price, when ownership passes, what conditions must be satisfied before closing and what liabilities remain with each party.

For a foreign seller, particular attention should be given to the scope of representations and warranties.

A buyer may request extensive warranties concerning:

corporate status, tax, employees, litigation, contracts, intellectual property, licences, financial statements and compliance.

The seller should negotiate:

financial caps, time limits, disclosure mechanisms, knowledge qualifiers where appropriate and exclusion of matters already priced into the transaction.

A foreign investor should not allow a successful exit to turn into an unlimited long-term guarantee of the entire Turkish business.

29. Escrow and Holdbacks Can Affect the Investor’s Real Exit Value

A buyer may agree to a headline purchase price of EUR 20 million but insist that EUR 5 million remain in escrow for three years to secure warranty claims.

Economically, the investor has not received a fully liquid EUR 20 million exit on closing.

Therefore, foreign sellers should evaluate:

not just the headline valuation but the certainty and timing of payment.

The seller should examine:

escrow amount, release schedule, claim threshold, liability cap, set-off rights and whether deferred consideration earns interest.

The “best price” is not always the offer with the highest headline number.

A slightly lower offer payable fully at closing may have greater economic value than a higher price subject to substantial contingencies.

30. Earn-Outs Can Bridge Valuation Disagreements but Create New Risks

Suppose the foreign investor believes the company is worth EUR 20 million.

The buyer believes it is worth EUR 15 million.

The parties might agree:

EUR 15 million at closing and up to EUR 5 million additional consideration if the company reaches specified revenue or EBITDA targets.

This is an earn-out.

Earn-outs can help bridge valuation gaps.

But they can also create disputes after the seller loses control of the business.

The seller may argue that the buyer intentionally reduced profits or changed accounting policies to avoid paying the earn-out.

Therefore, the SPA should clearly define:

the performance metric, accounting principles, management restrictions during the earn-out period, information rights and dispute-resolution mechanism.

31. Management Resignation and Work Permits Should Be Included in the Exit Plan

A foreign shareholder may also be:

a board member, Ltd. Şti. manager, authorised signatory or employee.

Selling the shares does not necessarily remove all those positions automatically.

Closing should therefore address whether the foreign investor’s nominated directors or managers resign and when signature authorities are revoked.

Where the exiting shareholder or executives hold Turkish work permits connected to their company role, immigration consequences should also be reviewed.

Corporate exit and personal immigration status are related but legally distinct matters.

32. Guarantees Given by the Foreign Shareholder Must Be Released

This is an extremely important practical point.

A foreign investor may have provided:

a shareholder guarantee to a Turkish bank, parent-company guarantee, letter of comfort or security supporting the Turkish company’s obligations.

Selling the shares does not automatically release those guarantees.

A foreign investor can therefore sell 100% of the company and still remain exposed to its bank debt unless the guarantee is formally released.

The SPA should make release of material seller guarantees a condition to or simultaneous step at closing wherever possible.

An exit is incomplete if the investor no longer owns the company but remains responsible for its liabilities.

33. Shareholder Loans Must Also Be Addressed

The foreign investor may have financed the Turkish company through shareholder loans in addition to equity.

Selling the shares does not automatically determine what happens to those receivables.

Possible structures include:

the company repays the shareholder loan before closing;

the buyer acquires the shareholder loan;

the foreign investor retains the receivable;

or the loan is capitalised before sale.

The purchase price and the shareholder loan should therefore be analysed separately.

Otherwise, the parties may disagree over whether the negotiated “company price” included repayment of shareholder debt.

34. Can a Foreign Investor Exit If No Third-Party Buyer Exists?

This is the hardest problem for minority investors.

Private-company shares are illiquid.

There may be no independent market where a 20% or 30% shareholder can simply sell the investment.

If the controlling shareholder refuses to purchase the stake and no third party wants to acquire a minority interest, the foreign investor can become economically trapped.

This is why sophisticated minority investors negotiate exit mechanisms at entry.

These may include:

put options, tag rights, mandatory sale processes, IPO cooperation, drag rights in appropriate structures or deadlock buy-sell mechanisms.

Without such protection, the investor may own valuable shares but have no practical route to convert them into cash.

35. A Foreign Investor Should Not Wait Until the Exit to Start Preparing for Due Diligence

Any sophisticated buyer will conduct due diligence.

The seller should therefore prepare the company before launching a sale process.

Potential buyers may investigate:

corporate records, tax, SGK, employees, litigation, contracts, intellectual property, KVKK, regulatory licences, related-party transactions and ownership records.

Deficiencies discovered during due diligence usually reduce:

price, transaction certainty or both.

For example, if software represents most of the company’s value but contractor IP assignments were never signed, the buyer may demand a substantial holdback.

If the company has incomplete shareholder records, transfer mechanics may become uncertain.

Exit readiness should therefore be treated as an ongoing corporate-governance discipline.

36. A Practical Foreign Investor Exit Process

A well-managed private-company exit will generally move through a sequence covering legal review, valuation, buyer selection, transaction documentation and regulatory completion rather than jumping directly to a notary or share endorsement.

A practical process is:

1. Review the articles, SHA and investment documents for transfer restrictions and exit rights.
2. Determine whether the target is an A.Ş. or Ltd. Şti. and identify the formal transfer procedure.
3. Review ROFR, ROFO, pre-emption, lock-up, tag, drag, put and call provisions.
4. Value the company and determine whether the investor is selling only its own shares or seeking a full-company sale.
5. Prepare the company for buyer due diligence.
6. Negotiate a term sheet or letter of intent.
7. Perform tax, treaty and regulatory analysis.
8. Check Competition Authority and sector-specific approval requirements.
9. Negotiate the SPA, including price, warranties, indemnities, escrow and conditions precedent.
10. Complete the legally required share transfer steps.
11. Update the share ledger, ETDS, Trade Registry or MKK records as applicable.
12. Complete E-TUYS foreign-investment reporting.
13. Release the seller from guarantees and resolve shareholder loans.
14. Transfer the sale proceeds abroad through the banking system after satisfying applicable documentation and tax requirements.

A transaction can become significantly more difficult if these steps are addressed in the wrong order.

Frequently Asked Questions

Can a foreign investor freely sell shares in a Turkish company?

Generally, foreign investors are subject to the same share-transfer rules as domestic investors. However, the articles, shareholders’ agreement, company type and special sector regulation can restrict or condition the transfer.

Is government approval generally required because the seller is foreign?

No general foreign-investment approval is ordinarily required simply because a foreign investor sells shares. Turkey’s FDI regime is notification-based rather than based on general pre-approval, although regulated sectors can require specific consent.

How does an A.Ş. share transfer work?

Registered A.Ş. shares are generally freely transferable unless the law or articles provide otherwise. Where registered share certificates exist, transfer by legal transaction can take place through endorsement and delivery, subject to applicable restrictions.

Does the buyer need to be entered in the A.Ş. share ledger?

For registered and uncertificated shares subject to Article 499, the share ledger is critical because only the person registered there is recognised as shareholder in relations with the company.

How does an Ltd. Şti. share transfer work?

It generally requires a written agreement with notarised signatures, general assembly approval unless the company agreement provides otherwise, and Trade Registry registration of the ownership change.

Can an Ltd. Şti. general assembly refuse the sale?

Yes, under the default rule it may ordinarily refuse approval without stating a reason unless the company agreement provides otherwise. If it does not reject the application within three months, approval is deemed granted.

What is a tag-along right?

It allows a minority shareholder to participate when another shareholder, typically the controller, sells shares under the conditions specified in the shareholders’ agreement.

What is a drag-along right?

It can allow a qualifying majority shareholder to require other shareholders to participate in a full-company sale under agreed conditions.

Can the foreign investor use a put option to exit?

Potentially, if a properly structured put right was agreed. The trigger, price, payment method and enforceability should be carefully drafted.

Is E-TUYS relevant when the investor exits?

Yes. The official foreign-investment reporting system includes an FDI Share Transfer Data Form, and changes in foreign shareholding should be reviewed for E-TUYS reporting.

Can Competition Authority approval be required?

Yes, where the transaction creates a lasting change of control and the current turnover and other notification conditions are satisfied. Turkey materially increased the relevant thresholds in February 2026.

Can a foreign investor transfer the share-sale proceeds abroad?

Yes. The Foreign Direct Investment Law expressly provides that proceeds from sale or liquidation of all or part of an investment may be transferred abroad through banks or financial institutions.

Does a foreign investor pay Turkish tax when selling shares?

Potentially. Tax depends on whether the seller is an individual or corporation, Turkish resident or non-resident, the company form, nature of the shares, holding period and applicable tax treaty.

Are A.Ş. and Ltd. Şti. shares taxed the same when sold by an individual?

Not necessarily. Turkish income tax legislation provides special treatment for qualifying share certificates of fully taxable companies held for more than two years, whereas an Ltd. Şti. partnership interest does not automatically receive the same two-year treatment.

Can a Turkish corporate seller receive an exemption on participation-share gains?

Potentially. The current Corporate Tax Law provides a 50% exemption for qualifying participation-share sale gains where the statutory two-year holding and other requirements are satisfied.

Does selling shares automatically release the investor’s bank guarantees?

No. Guarantees and other security must be separately released or otherwise addressed.

Conclusion: How Should a Foreign Investor Plan a Successful Exit From a Turkish Company?

Foreign investors should regard exit planning as part of the original investment structure.

The ability to sell shares is not merely an issue to consider five years after the investment has been made.

It affects the investment’s value from the first day.

Turkey provides a generally open framework for foreign investment. Foreign investors have the same basic share-transfer rights as domestic investors, and Turkish FDI legislation allows the proceeds from the sale or liquidation of an investment to be transferred abroad.

The challenge lies in structuring the private-law and corporate mechanics correctly.

For an A.Ş., the starting rule is generally favourable to transferability.

Registered shares are freely transferable unless the law or articles provide otherwise.

But the investor should still review:

the articles, share certificates, share ledger, contractual transfer restrictions and governance rights.

For an Ltd. Şti., the process is more formal.

Article 595 generally requires a written transfer agreement with notarised signatures and general assembly approval unless the company agreement provides otherwise. Article 598 then requires Trade Registry registration of the share transition through the company managers.

This means that the choice between A.Ş. and Ltd. Şti. has consequences not only when entering an investment, but also when leaving it.

The next level of exit planning is contractual.

A foreign investor should consider at entry whether the SHA contains:

transfer restrictions, ROFR or ROFO, tag-along, drag-along, put/call rights, valuation mechanisms and deadlock exit provisions.

These mechanisms can determine whether an investor has a genuine exit or merely a theoretical right to sell shares that nobody is obliged to buy.

For minority foreign investors, tag-along rights can be particularly important.

Without tag protection, a local controlling shareholder can potentially sell control and leave the foreign minority invested alongside an unknown purchaser.

For controlling foreign investors, a well-designed drag-along provision can be equally important because strategic buyers often want to acquire 100% rather than negotiate with multiple minority shareholders.

Option rights can provide an additional exit route.

A put option can be especially useful where the investment is expected to last for a defined period or where serious breach or deadlock should allow the foreign investor to require a buyout.

However, option rights should always answer the practical question:

Who has enough money to perform the buyout when the option is exercised?

A contractual right against an insolvent shareholder is not a successful exit mechanism.

Valuation should also be negotiated while the parties are still aligned.

A private-company shareholder cannot rely on a stock exchange price.

The SHA should therefore determine how value will be calculated if there is no third-party offer.

This can prevent the entire exit process from collapsing into a valuation dispute.

Once a buyer has been identified, the investor should perform regulatory analysis.

A foreign shareholder sale does not ordinarily require general government approval merely because the seller is foreign. However, regulated industries may require regulator consent to changes in ownership or control.

Merger control must also be considered.

The Turkish Competition Authority substantially revised the applicable turnover thresholds in February 2026, increasing the principal headline figures to TRY 1 billion, TRY 3 billion and TRY 9 billion within the respective tests.

The transaction should therefore not close until any required Competition Authority clearance has been obtained.

The foreign-investment reporting consequences should then be addressed.

Changes in foreign ownership are reflected through E-TUYS, which expressly includes the FDI Share Transfer Data Form.

For companies subject to the 2026 ETDS framework, ownership changes should also be reflected properly in the electronically maintained share ledger.

Tax planning is equally important.

The tax result can change materially depending on whether the seller is:

an individual, Turkish company or foreign company.

For individuals, the distinction between qualifying A.Ş. share certificates and ordinary partnership rights can be particularly significant. Turkish legislation excludes qualifying shares of fully taxable companies held for more than two years from the relevant capital-appreciation rule under the statutory conditions, whereas Ltd. Şti. partnership interests do not automatically benefit from the same treatment.

For a Turkish corporate shareholder, current rules provide a 50% corporate-tax exemption for qualifying participation-share gains where the two-full-year holding and other statutory conditions are met.

For foreign corporate or individual sellers, the applicable double taxation treaty should always be reviewed before the transaction price is finalised.

The final stage is ensuring that the investor is genuinely free from the Turkish business after closing.

That means more than receiving the purchase price.

The investor should verify that:

shares have been transferred, corporate records updated, management positions resigned where relevant, signature authority removed, shareholder loans resolved and guarantees released.

This last point is critical.

A foreign shareholder that sells 100% of its shares but leaves a EUR 5 million parent guarantee in place has not achieved a complete economic exit.

The strongest foreign-investor exit process can therefore be summarised as:

review investment documents → identify transfer restrictions → determine A.Ş./Ltd. Şti. mechanics → activate ROFR/tag/drag/option procedures → identify buyer → value the shares → prepare due diligence → analyse tax → obtain regulatory/competition approvals → negotiate SPA → transfer shares against payment → update corporate records/ETDS → complete E-TUYS → release guarantees and management positions → transfer proceeds abroad.

The central lesson is straightforward:

An investor’s ability to enter a company is important. Its ability to leave on commercially workable terms is equally important.

A foreign investor should therefore never ask only:

“How many shares will I receive?”

It should also ask:

“Who can buy these shares from me, who can prevent me from selling them, how will the price be determined, and what legal mechanism guarantees that I can ultimately convert my investment back into cash?”

When those questions are answered at the beginning of the investment, an eventual Turkish exit is considerably more predictable.

When they are ignored, a profitable company can still become an illiquid investment from which the foreign shareholder finds it surprisingly difficult to leave.

This article reflects Turkish corporate, foreign-investment, competition and tax legislation and publicly available official guidance as of August 2026. It is intended for general informational purposes only and does not constitute transaction-specific legal, tax, M&A or investment advice. The appropriate exit process depends on the company’s legal form, articles of association, shareholders’ agreement, seller’s tax residence, share type, regulatory sector, transaction value and the identity and rights of the proposed purchaser.