Bankruptcy due to over-indebtedness of corporation and preventing bankrupcy through composition with creditors

Corporation have an important place in the national economy. Compared to other trade partnerships, they concern a wider environment. The deterioration in the financial situation of the corporation that affects such a large environment causes significant problems. Over-indebtedness like capital loss, implies a deterioration in the financial situation of the corporation, The basic regulation on over-indebtedness, is included in Article 376 of the Turkish Code of Commerce. In this study, it is aimed to determine over-indebtedness of the corporation companies and to evaluate the results by explaining the legal aspects. Our study consists of two parts. In the first part, the concept of Over-indebtedness, differentiation of over-indebtedness from the similar concepts, identification of over-indebtedness and the results of the over-indebtedness will be started to be analysed. Besides the legal consequences of submitting over-indebtedness will be examined. In this context, the bankruptcy situation will be considered as the most severe result, which is firstly linked to the over-indebtedness. Secondly, we will examine the case that court decrees that bankruptcy is denied. In the case of over-indebtedness, the composition with creditors institution is also regulated. Finally, in this context, try to explain postponement of bankruptcy which was abolished in Turkish law and composition with creditors in general. In the two section, preventing bankruptcy through composition with creditors will be examined comparatively with the regulations on the postponement of bankruptcy which was abolished in Turkish law. Keywords: Over-indebtedness in corporation, corporation, over-indebtedness, bankruptcy, composition with creditors, postponement of bankruptcy.