The liquidation and deregistration of a Turkish company does not necessarily mean that its creditors have lost their claims.
A common problem in international commercial disputes arises when a foreign company has a contractual claim against a Turkish counterparty, but the debtor enters liquidation and is removed from the Turkish Trade Registry before the debt is recovered.
Turkish law provides a specific mechanism for such circumstances: additional liquidation (ek tasfiye) and re-registration of the company.
Can You Sue a Company That Has Been Liquidated in Turkey?
Once liquidation is completed and the company is removed from the Trade Registry, its legal personality normally ceases. However, Article 547 of the Turkish Commercial Code (Türk Ticaret Kanunu — TCC) provides an important mechanism.
Where it becomes apparent after the completion of liquidation that additional liquidation procedures are necessary, creditors are among the persons entitled to apply to the Commercial Court of First Instance at the company's registered seat for its re-registration.
What Is Additional Liquidation in Turkey?
Additional liquidation, or ek tasfiye, is a legal mechanism allowing a deregistered company to be restored for the limited purpose of completing outstanding liquidation matters.
It may become relevant where an unpaid creditor remains, litigation needs to be commenced or continued, company assets are subsequently discovered, enforcement measures are required, or a creditor's claim was not properly dealt with during liquidation.
If the court considers the application justified, it may order the company to be re-registered for additional liquidation and appoint the former liquidator or one or more new liquidators.
What If the Liquidator Knew About the Debt?
This can be particularly important. Article 541 TCC regulates the protection of creditors during liquidation. Creditors known from the company's records or other documents and whose addresses are known must be notified, subject to the statutory framework.
Notices, correspondence, mediation records, contracts, invoices, bank transfers and court documents can therefore become important evidence that the liquidator was aware of the creditor's claim before deregistration.
What If the Company Was Liquidated During Litigation?
Removal from the Trade Registry does not by itself mean that the underlying substantive claim has disappeared. Depending on the circumstances, a separate company restoration and additional liquidation process may be required before the underlying claim or enforcement proceedings can be pursued or continued.
Does Restoration Automatically Mean Debt Recovery?
No. Two issues should be distinguished: restoring the company for additional liquidation, and proving and recovering the underlying debt.
An order for additional liquidation does not automatically establish that the creditor is entitled to the amount claimed. The underlying contractual or other claim must still be established through the appropriate proceedings.
Foreign Creditors Against Liquidated Turkish Companies
Cases involving foreign creditors require additional consideration of jurisdiction, governing law, service abroad, mandatory mediation where applicable, evidence and subsequent enforcement. A foreign company discovering that its Turkish debtor has been liquidated should therefore investigate the Trade Registry history before concluding that recovery is impossible.
RT-Union | Company Restoration and Debt Recovery in Turkey
RT-Union advises international businesses in commercial disputes and debt recovery proceedings involving Turkish counterparties. Our work includes reviewing Trade Registry and liquidation records, assessing whether Article 547 TCC can be applied, commencing company restoration and additional liquidation proceedings, representation before Turkish courts, and subsequent debt recovery and enforcement.
Deregistration of a debtor is not necessarily the end of a creditor's claim. In appropriate cases, restoring the company for additional liquidation may be the first step towards recovery.
