The transfer of assets is, transferring assets or all rights at the assets side and all liabilities at the debit side of the company, with a transfer contract concluded between two parties, either individuals or legal entities. At Turkish law, the asset deals between partnerships are provided at different laws, within the context of their own disciplines. The partnerships to conduct an asseat deal should act according to the related regulations during the transaction.
However, it should be noted that, at Turkish Code of Commerce, there isn’t any special formulation for the asset deal between partnerships. Since conclusion of a transfer agreement is a must for the transfer of the assets of a partnership or partnership itself with its all assets and liabilities and this transaction happens to arise rights and liabilities, the matter of asset transfer is provided at the Turkish Obligations Code. At asset and business firm transfers, the Article 179 of the Turkish Obligations Code shall apply. Accordingly, “The one who takes over a business firm with its assets and liabilities shall be liable for the debtors and creditors of the business firm, beginning from the assignment’s announcement date at newspapers; insofar the previous debtor (transferor) shall remain to be jointly liable with the new debtor (transferee);
This period shall commence to proceed from the notice or announcement date for the due debts and for deferred debts, from the date of due. The provisions to be applied to such delegation of debts are an exception to the provisions of delegation of a single debt.”
At the transfer of assets or a business firm, the parties agree on transfer of specific assets or all assets and liabilities of an enterprise, from a commercial enterprise to another through a contract, and the assets and liabilities are transferred pursuant to provisions of the concluded contract. For the validation of share deal or business firm’s transfer, the approval of creditors is not required, but for legal validation of the deal/transfer, the creditors should be informed or the deal/transfer should be announced. For asset deal, a transfer agreement between the companies is not assumed to be a formal contract; but for the transfer of real rights concerning the movable estate or real estate property, the formal contracts provided by the related laws should be maintained. Nevertheless, the transfer contract may not include all assets and liabilities transferred. As it can be derived from Article 179 of Turkish Obligations Code, starting from the notification to the creditors or announcement, the transferee and the transferor shall be jointly liable to indemnify the debtors for two years. It should be noted that, the transferee’s liability for the assigned assets or business firm is not restricted to the debts listed at the transfer agreement. Whether the transferee is acknowledged or not, whether all debts are included in the transfer agreement or not, the transferee shall be completely liable for the debts of assigned assets or business firm. Any transfer agreement setting forth otherwise, that is, providing only the transfer of the plus side is legally invalid. If the transfer of a business firm, consequently the transfer of all assets, happens to arise from merger of the companies, the former company cannot be jointly liable for the debts for two years, pursuant to Article 180 of Turkish Obligations Code. In this case, only the company who has merged the former company within itself or the new company incorporated as a result of the merger shall be liable.
Upon Article 280 of the Law on Bankruptcy, the creditors to the business firm which has transferred its assets or it has been entirely transferred can claim for the cancellation of the transfer transaction provided that certain circumstances exist. This article applies to those circumstances when a business firm is transferred or a significant amount of the assets of the business firm is sold to third parties with the purpose of having its creditors suffer from losses. In this case, the creditor/s may claim the cancellation of transfer or sale transaction by a lawsuit. The creditor should have started unsatisfied enforcement proceedings via execution or bankruptcy within five years starting from the date of fraudulent transaction; that is, if the creditor starts enforcement proceedings within five years from the disposition, then he’ll be entitled to file a lawsuit for the cancellation. Besides, the creditor is entitled to claim sequestration over the property which is the subject of the fraudulent transaction. According to the provisions of Law on Bankruptcy, it is assumed that, the transferee or the purchaser is aware of the fact that the transfer or sale transaction is exercised to the disadvantage of the debtor’s creditors. This prima-facie evidence can be disproven by proving that, at least three months before the transfer’s or sale’s date,
– The plaintiff of the lawsuit was informed on the circumstances in written form; or
– The announcement of sale/transfer was hanged on noticeable the billboards at the business firm’s premises and it was also announced at the Trade Registry Gazette; and when such an announcement is impossible
– The sale/transfer was announced with suitable media, to have all the creditors learn about the relevant transaction. If the transferor succeeds to prove any of these facts, then it shall not be liable from the debts of the transferee.
Similar to the Article 280 of Law on Bankruptcy, the Article 30 of The Law on Collection Procedure of Public Credits covers the legal transactions exercised to the disadvantage of the debtor. The relevant article provides that, all transactions exercised by the debtor and third parties, who know or should have known the fact that the transactions are actually exercised to render the collection of debts impossible, are invalid. Here, the difference between the articles of the laws is, for the Law on Collection Procedure of Public Credits, the timing of the transactions is irrelevant, so such a transaction can be cancelled anytime, without being subject to any time prescription.
The Labour Law has found it necessary to set the transfer of a business firm totally or partially, with respect to the labour rights as well as transferor’s and transferee’s liabilities. Pursuant to Article 6, Paragraph 1 of Labour Law, when a work place is totally or partially transferred through a legal transaction, all work contracts at the date of transaction are assigned to the transferee, for those related to the transferred work place or the department/section of the work place subject to the transfer. To the context of the transfer provided by the Article, the final and ultimate transfer of a work place belonging to a business firm through merger, acquisition or privatization as well as work place’s temporary and time-bound transfers due to a lease contract. For both cases, the transferee assigning the work place of a business firm totally or partially in any manner whatsoever is bound with the work contracts concluded before the transfer and the transferor automatically becomes the employer to those contracts. The transferor or the transferee cannot terminate the work contracts due to the transfer itself. Only exception is, exercise of termination rights which is required by the transferor or transferee employer’s solid economical or technological needs or when a change at the labour organization is a must. Pursuant to the same article, when the employees to the assigned work place claim any of their rights which is bound to their work terms, then their actual starting dates at the work place (before the transfer) should be predicated on. Put another way, for the calculation of termination indemnification, termination pay and annual leave with pay of a worker/employee, the total work period spent at the work place is taken into consideration, without considering the identity of the employer. Moreover, for the credits of the worker/employer which have arisen before the transfer of the work place, both the previous and new employees shall be jointly liable to indemnify for two years. In other words, the worker/employee is free to lodge both its former employer and new employer for total or partial payment of his credits that are involved in the liability of its former employer. In case the transferee employer is rendered to pay the worker credits of previous period, then it can recourse to the former employer. But, it should be noted that, this right of recourse should be exercised within two years of starting from the transfer. If the transferor employer is a legal entity and the transfer has been a result of a merger, acquisition or a corporate type transformation, the business firm transferred by a merger or acquisition and the corporately transformed business firm shall not be jointly liable for the workers credits.
Besides, the work place’s transfer is also provided by the Social Insurances Law; Article 82 of the Law provides that, the transferor and the transferee are jointly liable from the unpaid insurance premiums of the workers, together with default fines and due interests. However, here the joint liability is not restricted with a time prescription.