Asset Deal in Türkiye: The Debt That Transfers With the Business (TCO Art. 202, TCC Art. 11/3, Labour Act Art. 6)

Turkish law does not fully allow that — three separate statutes move debt across with the business.

Buying the business instead of the company is the standard instinct of a foreign purchaser who has read the target’s litigation schedule and decided not to inherit its past. In Türkiye that instinct only half works: Article 202 of the Turkish Code of Obligations No. 6098 makes whoever takes over a business, together with its assets and liabilities, directly liable to the seller’s creditors for the debts inside it, and Article 6 of the Labour Act No. 4857 moves every employment contract across with its accrued seniority intact. An asset deal in Türkiye is therefore not a liability firewall; it is a liability filter, and the value of the structure depends entirely on how carefully the filter is drawn, published and secured.

The distinction matters because the two structures fail in opposite directions. A share purchase is transparent about what it captures — everything the entity has ever done. An asset purchase looks selective, and the drafting often reads as though the parties believe the exclusions bind the outside world. They do not. What follows sets out which statute moves which liability, where the clocks start, and which consents a buyer has to collect before closing rather than after. It sits alongside our wider treatment of deal structuring and corporate transactions in Türkiye, which covers the transaction process itself.

Article 202 of the Code of Obligations: the asset-deal buyer joins the debt

Article 202/1 of Law No. 6098 provides that a person who takes over a body of assets or a business together with its assets and liabilities becomes liable to creditors for the debts contained in that estate or business, running from the date on which the transferee notifies the creditors or announces the transfer — in the Turkish Trade Registry Gazette for commercial enterprises, and in a newspaper distributed nationwide for anything else.

Two features of the article do most of the damage in practice.

First, the seller does not walk away. Article 202/2 keeps the previous debtor jointly and severally liable alongside the buyer for two years. For debts that are already due, that period runs from the date of notice or announcement; for debts maturing later, it runs from their own maturity date.

Second, and this is the paragraph that gets overlooked, Article 202/4 states that unless the buyer performs the notice or announcement obligation, the two-year period does not begin to run. A quiet transfer, done without publication because the parties preferred not to alert the market, does not shorten anyone’s exposure — it removes the cut-off entirely and leaves seller and buyer jointly answerable to creditors with no running clock. Publication is not a formality that follows the deal; it is the event that starts the only limitation the article offers.

Article 202/3 completes the picture by equating the consequences of this transfer of debt with an external assumption of debt. That equation brings in the general rules on assumption of debt: under Article 199/3 the new debtor cannot raise against the creditor defences arising from the internal assumption agreement. A clause in the transfer agreement allocating pre-closing liabilities to the seller therefore regulates the relationship between the parties and gives the buyer a recourse claim, but it is not a defence against the creditor. The commercial consequence is that indemnity language alone is worth very little without a holdback, escrow or bank guarantee standing behind it.

Article 203 extends the same creditor protection where two businesses are combined by mutual assumption of assets and liabilities, or where one joins the other: the creditors of both hold the rights arising from an assumption of assets and may claim in full against the new business.

Article 11/3 of the Commercial Code: what actually moves in one step

Article 11/3 of the Turkish Commercial Code No. 6102 is the provision that makes a single-instrument business transfer possible at all. A commercial enterprise may be transferred as a whole, without the separate disposal transactions that each asset would otherwise require, and may be the subject of other legal transactions in the same way.

The article then supplies a default content list. Unless otherwise provided, the transfer agreement is deemed to include the fixed assets, the enterprise value (goodwill), the lease right, the trade name and other intellectual property rights, and the assets permanently allocated to the enterprise. That presumption is a drafting trap in both directions: a buyer who assumed a particular asset was excluded, and a seller who assumed the trade name was retained, will each be arguing against the statutory default unless the agreement says otherwise expressly.

Formality is mandatory. The final sentence of Article 11/3 requires the transfer agreement, and other contracts taking the commercial enterprise as a whole, to be made in writing, registered with the trade registry and announced. The trade name follows the same logic under Article 49: a trade name cannot be transferred separately from the enterprise, and transfer of the enterprise results in transfer of the name unless the parties have expressly agreed otherwise, with the transferee entitled to use it as it stands.

Employees: Article 6 of the Labour Act moves the whole file

Article 6 of Law No. 4857 is the most mechanical of the three transfer rules and the least negotiable. Where a workplace or a part of it is transferred on the basis of a legal transaction, the employment contracts existing at the workplace on the transfer date pass to the transferee with all their rights and obligations. The transferee must then treat entitlements that depend on length of service by reference to the date the employee began work with the transferor.

The joint liability rule is narrower than buyers usually assume. The transferor and the transferee are jointly liable for debts that had arisen before the transfer and were payable on the transfer date, and the transferor’s exposure is limited to two years from the transfer. A severance indemnity that only becomes due on a termination after closing is not within that shared bucket — it is calculated on the employee’s full seniority, including the years served with the seller, and it lands on the buyer. Pricing an asset deal without quantifying that accrued but not-yet-due severance exposure is the single most common valuation error in this structure; how that two-year window is counted, and which debts fall inside it, is worked through in our note on the transfer of an undertaking and the transferor’s two-year liability. The wider framework for engaging and terminating staff in Türkiye is set out in our note on employing staff in Türkiye as a foreign employer.

Three further points sit in the same article. Joint liability does not apply where the legal personality ends through merger, joining or a change of type. Neither the transferor nor the transferee may terminate an employment contract merely because of the transfer, and the transfer is not just cause for the employee either — although terminations required by economic, technological or work-organisation reasons, and the immediate termination rights of both sides for just cause, are expressly reserved. Finally, none of Article 6 applies where the workplace is transferred as a result of the liquidation of assets in bankruptcy, which is why distressed acquisitions out of a bankruptcy estate follow a materially different risk profile.

Article 6 also contains no information-and-consultation procedure. Turkish law has no TUPE-style consultation regime and does not replicate the EU employee consultation obligation on transfer, so the timing of the announcement is a commercial and industrial-relations decision rather than a statutory one.

Tax and public receivables: a different statute, a different trap

The Law on the Procedure for Collection of Public Receivables No. 6183 does not contain a general successor-liability rule for someone who buys a business as a going concern. Its succession provision, Article 36, is confined to legal-entity reorganisations: on a merger, the newly formed legal entity; on a transfer of the entity, the transferee legal entity; on a division, the entities taking over the assets; and on a change of type, the new legal entity, each replace the predecessor for the purposes of that law. An asset purchaser is not in that list.

What is in the law is Article 30. Where the debtor has no assets or insufficient assets, unilateral transactions made by the debtor with the intent of preventing collection of all or part of a public receivable, and all transactions made with persons who knew or should have known of that intent, are void whatever their date. Article 31 then requires those who benefited from such transactions to hand back what they obtained, or its assessed value if they have disposed of it, without any claim against the public administration for what they paid. There is no time limit and no good-faith cushion for a buyer who was on notice of the seller’s tax position — which is precisely why a public-debt clearance check on the seller belongs in diligence, not in the closing checklist.

The contrast with a share deal is instructive. Article 35 of the same law makes limited liability company shareholders directly liable for public receivables that cannot be collected from the company, in proportion to their capital shares, and provides that where a shareholder transfers the capital share, the transferor and the transferee are jointly and severally liable for public receivables relating to the pre-transfer period. Buying shares in a Turkish limited company therefore carries a statutory tax exposure that buying its business does not.

On indirect tax, the exemption in Article 17/4-c of the VAT Law No. 3065 is narrow: it covers the transactions described in Article 81 of the Income Tax Law, the conversion of ordinary partnerships into capital companies on the conditions there stated, and transfers and divisions carried out under the Corporate Tax Law. An ordinary sale of business assets falls outside it and is treated as a supply of the individual assets. Rates and any monetary thresholds change annually, so the applicable figures should be taken from the current year’s communiqué rather than from any fixed reference.

Consents, leases and the contracts that do not move by themselves

Article 11/3 moves the assets. It does not move the counterparties. An ongoing supply, distribution or service contract is transferred under Article 205 of the Code of Obligations, which requires an agreement between the transferee, the transferor and the party remaining in the contract — or an agreement between transferee and transferor resting on the remaining party’s prior consent or subsequent approval. The validity of the assignment follows the form of the contract being assigned. A buyer who has paid for a customer book and not collected those consents has bought an introduction, not a revenue stream.

The premises deserve separate attention because two provisions pull against each other. Article 11/3 presumes the lease right is included in the transfer, but that presumption governs the buyer–seller relationship. Against the landlord, Article 322/2 prevents a tenant of a residence or a roofed workplace from subletting or transferring the right of use without the lessor’s written consent, and Article 323 provides that the tenant may not transfer the lease relationship without that written consent — while adding that in workplace leases the lessor may not refuse consent without just cause. Once consent is given, the transferee steps into the tenant’s position and the outgoing tenant is released, except that in workplace leases the transferring tenant remains jointly and severally liable with the transferee until the end of the lease, for a maximum of two years.

One more provision bears on the seller’s side. Where the seller is a merchant who ceases trading after the sale, Article 44 of the Enforcement and Bankruptcy Law No. 2004 requires notification to the trade registry within fifteen days together with a declaration listing all assets, liabilities and the names and addresses of creditors; the position is then announced. Bankruptcy proceedings may be brought against that merchant for one year from the announcement, and for two months from filing the declaration the merchant may not dispose of attachable assets, with the registry entering a restriction on transfer. A seller who exits trade immediately after closing therefore leaves a live one-year bankruptcy window over the transaction.

Finally, merger control. Article 7 of the Competition Act No. 4054 covers a person or undertaking acquiring the assets of another undertaking, not only its shares or the instruments conferring management rights, with inheritance the only carve-out. The Competition Board determines by communiqué which transactions must be notified and authorised in order to become legally valid, and Article 11 empowers the Board to fine unnotified transactions and, where the transaction falls within Article 7/1, to order it unwound and the assets returned or assigned on. A business sold as a going concern generates its own turnover, so the threshold analysis has to be run on the target business rather than dismissed because no shares are changing hands. Structuring questions of this kind are handled within our mergers and acquisitions work, and the underlying enterprise-transfer formalities within our commercial law practice.

What this means for the asset-deal documents

The pattern across all six sections is consistent: Turkish law lets the parties choose the perimeter of what is sold, but not the perimeter of who may be sued. Three drafting consequences follow directly.

The notice or announcement under Article 202 should be treated as a closing deliverable with a fixed responsible party, because until it happens no limitation period runs for anyone. The consideration structure should assume that indemnities are recourse mechanisms rather than shields, which points toward a retained portion of the price or third-party security sized against the identified debt and the accrued severance pool. And the consent workstream — counterparties under Article 205, the landlord under Article 323, and any merger-control filing under Article 7 — needs to start early enough that the transaction is not closed around gaps that only surface when a creditor, a landlord or the Competition Board reaches the same conclusion from the other side.

Statutory texts referred to above are published at mevzuat.gov.tr: the Turkish Code of Obligations No. 6098, the Turkish Commercial Code No. 6102, the Labour Act No. 4857, the Law on Collection Procedure of Public Receivables No. 6183, the Competition Act No. 4054, the VAT Law No. 3065 and the Enforcement and Bankruptcy Law No. 2004.

Where the buyer forms a new Turkish company to take over the business, the choice of vehicle and the formation steps are covered on our company formation in Turkey page.