Inalienable rights of joint stock company shareholders and the legal consequences of their violations

The inalienable rights of the shareholders in a joint stock company ("JSC"), are regulated, using the term expressly, for the first time under the Turkish Commercial Code No. 6102, in the context of the limitations on the alteration of the AoA (art. 452), and amongst the grounds for nullity of the resolutions of the board of directors (art. 391/1.c) and the general assembly (art. 447/1.a and b). However, the fact that the grounds for nullity specific to the law of JSCs, in particular the inalienable rights, are not listed numerus clauses, has raised legal security concerns. Considering the severe consequences of nullity in the law of JSCs, it is vital to examine the inalienable rights in a holistic manner and to discuss the pecularities of their violations. Although these rights are listed among the grounds for "nullity", the doctrine of "qualified violation of inalienable rights", developed by the Swiss doctrine and widely accepted also in Turkish law, argues that nullity shall be applied only in "qualified violations" of said rights, and that this condition shall be met by a resolution with an "abstract-general" content. Our study consists of three parts. In the first, the status of inalienable rights amongst other shareholder rights, with special reference to their relationship with the vested rights, is determined and their relationship with fundamental principles of the law of JSCs is analysed. In the second, inalienable rights, which are regulated in a complex manner, are analysed systematically and the criteria for the determination of "other" inalienable rights are further discussed. In the last part, pursuant to the doctrine of "qualified violation", the pecularities in the violation of inalienable rights by either bodies, and in this sense, the line between nullity and annulability are discussed in light of Turkish and Swiss jurisprudences.