Regulation Pertaining To The General Assembly Of Joint Stock Companies To Be Held Via Electronic Means

August 2012 Nilay Çelebi
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Introduction

Turkish Commercial Code numbered 6102 (the “TCC”) which came into force on 1 July 2012, is designated to meet the needs of the market, to provide compliance with European Union’s regulations in membership stage, to target the transparency. TCC brings innovations required by the information society such as e-government and e-company. Among these innovations, one of the most important and profitable example could be extracted as making general assembly and board of directors meetings via electronic means.In accordance with the changes of the TCC, Regulation pertaining to the General Assembly of Joint Stock Companies to be held via Electronic Means (the “Regulation”) is published in the Official Gazette numbered 28395 and dated 28.08.2012 and shall enter into force on 01.10.2012.

Content and the Aim of the Regulation

The provision that sets forth general assembly meeting via electronic means is Article 1527 of the TCC. According to the related provision, “attending to the general assembly via electronic means, giving opinion and voting result in all judicial conclusions of voting and attending physically”. The Regulation stipulates principles regarding attending to the general assembly via electronic means, giving opinion and voting; example of the provision required to be in the articles of association regarding attending to the general assembly via electronic means, principles of voting by the right-holder or his/her representative, principles related to running of the system of electronic general assembly and the obligations of its participants.

The Example and Application of the Provision of Articles of Association Related to Attending to General Assembly via Electronic Means and Voting

Pursuant to the Article 5 of the Regulation, companies which desire to apply the system of electronic general assembly are required to stipulate a related provision in their articles of association. In this framework, related provision is as follows:

“Attending to general assembly meeting via electronic means; the right-holders who have rights to attending company’s general assembly meeting may also attend to general assembly meeting via electronic means according to the TCC, Article 1527. As the company set out the general assembly system that allows the right-holders to attend general assembly via electronic means, give opinion and make suggestions pursuant to Regulation, in the meantime it may get service from the systems made for this purpose. Pursuant to this provision of articles of association, the right-holders and their representatives could use their signified rights indicated in aforesaid regulation provisions via this organized system for all general assembly meetings”.

This provision must take part in the articles related to general assembly meetings. Companies, which allow right-holders and their representatives for attending the general assembly meeting and voting should stipulate this provision without any change in the articles of association. Moreover, companies having the related provision in their articles of association should supply the right-holders and their representatives the option of attending the general assembly via electronic means and voting in each general assembly meeting.

Supplying the Access of Information and Documents Related to General Assembly

According to the Article 6 of the Regulation, the companies which apply the system of general assembly via electronic means, should comply with the obligation that the invitations should be made pursuant to TCC and articles of association related to general assembly meeting, the documents required to be submitted the right-holders before the general assembly and the documents related to agenda of the meeting with secure electronic signature in a given period set forth in the TCC should be present in system for the right-holders’ access.

Declaration of Attending to the General Assembly via Electronic Means and

Attending to the Meeting

Articles 7 and 8 of the Regulation regulate declaration of attending to the general assembly via electronic means and attending to the meeting. Pursuant to these provisions, right-holders who demand to attend to general assembly via electronic means by themselves or with their representatives should state their choice to the system. It is an obligation that, the ID of the representative, who attends to general assembly instead of his/her right-holder should be registered to system. The right-holder could generally appoint his/her representative or authorize him/her for each points separately either. The representative of the right-holder shall vote in accordance with the given authority. The right-holder who gives the information about his/her attendance via electronic means has possibility to retrieve his request on the system. However, in case the right-holder or his/her representative doesn’t retrieve his request, this right-holder or his/her representative cannot attend to general assembly meeting physically.

Attending to the general assembly via electronic means could be realized with secure electronic signatures of right-holders or their representatives via accessing the system.

Giving Opinion in General Assembly held via Electronic Means and

Voting

Giving opinion in general assembly held via electronic means and voting are set forth by the Articles 10 and 11 of the Regulation. The right-holder or his/her representative gives his/her opinion during general assembly meeting, which is attended via electronic means. Related right-holders use their voting rights via electronic means by the system.

The participants who attends general assembly meeting via electronic means have the possibility vote via system after the head of the meeting inform that voting has started related to the agenda topic. Each topic is voted separately after the head of the meeting’s notice. Neither the right-holder nor the representative may change his vote.

Obligations of companies

According to Article 13 of the Regulation, companies that apply the system of attending to general assembly meeting via electronic means and voting system have several obligations. In this framework, companies shall detect and register whether the system is convenient with this Regulation and TCC. Moreover, companies shall keep all records and ID’s of the participants who attend general assembly via electronic means for a period of ten years.

Conclusion

This Regulation stipulates principles regarding attending to the general assembly via electronic means, giving opinion and voting. It could be mentioned that the TCC brings several innovations related to business life and one of them is making general assembly meeting via electronic means. It is much easier to supply shareholders’ participation in companies’ administrative part by answering today’s world technological requirements by the current provisions.

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