Evaluation on mergers and demergers of companies from perspective of Turkish Commercial Law and Tax Laws

Companies have a tendency towards restructuring transactions to be able to adapt themselves to the increasing competitive environment within globalization process. It is an indisputable fact that the restructuring transactions are beneficial not only for the companies but also for the macro economy. Especially, within last a few years in which capital inflows accelerated in our country, restructuring of the companies has constituted a special importance. Therefore, the subject is very important for Turkey because the tendency towards restructuring transactions which is one of the competition strategies for the companies, have increased. Mergers and demergers are the most common types of restructuring transactions in practice. Therefore, we will cover only merger and demerger transactions in our study. The main purpose of our study is to provide detailed information on mergers and demergers of the companies, within an academical framework and to assist the readers to comprehend the subject from Turkish Commercial Law and tax legislation perspectives. Another purpose of our study is illustrating with examples on mergers and demergers, how these transactions are carried out in practice and what procedures are followed and how the financial statements are affected. After explaining the dynamics of mergers and demergers, we will also touch on procedures and principles of the transactions and their legal and tax consequences under light of Turkish Commercial Law numbered 6102 and various tax laws, stipulating the transactions from legal perspective. The analysis and explanations in each section have been supported with rulings released by Tax Administration. Key Words: Merger, demerger, Turkish Commercial Law, Tax Laws, restructuring