A reasonable period for paying a dividend is three-four weeks.
Preparation and execution of the corporate resolutions may take approximately two weeks (once the decisions to be passed are agreed with the client and the preparation of relevant financial statements is complete).
Timing for the payment of dividends will be determined on case-by-case basis (e.g. availability of funds, requirement of the banks - if any, etc.).
The General Assembly resolves when the dividend will be distributed. It is possible to approve this by way of an extraordinary general meeting as well.
Note also that advanced dividend is possible both for public and private companies. The legal procedure of advance dividend is subject to special requirements. A General Assembly resolution is required and the company must have sufficient profits based on interim financial statements prepared in the first, second or third quarters within the relevant financial period in which advanced dividend will be distributed.
Annual accounts are required to support payment of dividend. Interim accounts may be required in case of an advanced dividend distribution.
If the company is subject to independent auditing according to the provisions of the Turkish Commercial Code, then any accounts including the interim accounts required in connection with a particular dividend (i.e., on payment of an advanced dividend) must be audited as well.
Dividend will be distributed provided that legal capital reserves and as well as, if any, capital reserves stated under the AoA of company are reserved. Shareholders must keep/protect the legal reserves amounting to 5% of the company’s net profit each year until that 20% of the capital share amount is reserved as legal reserve.
Yes, it is possible to increase the legal reserves, mainly through the allocation of profits to such reserves by either adopting a general assembly resolution, which would take around 1-2 weeks or amendment of the AoA in this regard, which would take around 3-4 weeks.
No, there are no foreign exchange requirements on paying dividends to foreign parent companies.
Yes, there are no restrictions from a corporate law perspective on borrowing cash to settle a dividend.
Dividend in kind is possible if such dividend in kind is not among the assets allocated to the capital of company.
No.
No, there are no restrictions from a corporate law perspective on lending funds intra-group but cross-border. However, the transaction must be structured in accordance with transfer pricing and thin cap rules from a tax law perspective. In addition, if the external liabilities of a Turkish company exceeds its equity, 10% of the total expenses/costs related to the exceeding amount (like interest, commission, exchange rate difference) will be non-deductible in the calculation of corporate income tax base of the Turkish company.