50/50 Turkish Company Cannot Make Any Decisions: Court Remedies for Foreign Shareholders 2026 Updated Guide

A 50/50 Turkish company is paralyzed because equal shareholders cannot agree. Learn the legal remedies available to foreign shareholders, including corporate actions, injunctions, management disputes, exit strategies and dissolution proceedings.

A 50/50 shareholder structure can become one of the most difficult corporate disputes in Turkey when the two shareholders stop cooperating. Neither side controls a majority, important corporate resolutions may become impossible, managers or board members may block each other, bank accounts can become unusable and the company’s commercial activities may gradually stop. For a foreign shareholder, the situation can be particularly serious if the other shareholder controls the company’s accounting records, employees, bank relationships or day-to-day operations in Turkey. Turkish company law does not provide one universal remedy for every 50/50 deadlock. The appropriate strategy depends on whether the company is a joint-stock company or limited liability company, its articles of association, shareholder agreements, management structure and the specific misconduct causing the paralysis.

What Is a 50/50 Shareholder Deadlock?

A deadlock occurs when shareholders with equal or effectively equal voting power cannot obtain the majority required to make corporate decisions.

The problem can involve disagreements over management appointments, budgets, dividends, capital increases, borrowing, investments, asset sales, related-party transactions, company strategy or removal of directors or managers.

A temporary disagreement does not necessarily create a legally irreparable deadlock. The seriousness of the situation depends on its duration and its impact on the company’s ability to function.

Why Are 50/50 Companies Particularly Vulnerable?

A company owned equally by two shareholders works effectively while both sides cooperate. Once trust disappears, the same ownership structure can prevent either shareholder from controlling the company.

Neither party may have enough voting power to impose a solution, while each may have sufficient voting power to prevent the other’s proposal.

Start With the Articles of Association

Before considering litigation, review the company’s articles of association carefully.

Voting requirements, management appointments, representation authority, transfer restrictions and other corporate mechanisms may determine whether a genuine legal deadlock exists.

Review the Shareholders’ Agreement

If the parties signed a shareholders’ agreement, examine its deadlock provisions.

The agreement may contain negotiation procedures, escalation mechanisms, buy-sell provisions, valuation procedures, share-transfer rights, arbitration clauses or contractual exit mechanisms.

The enforceability and corporate effect of each provision should be evaluated separately.

Determine the Type of Turkish Company

The available remedies can differ significantly between a Turkish joint-stock company and a limited liability company.

Foreign investors should therefore avoid applying general corporate-law assumptions without first identifying the company’s legal form and governance structure.

Document the Deadlock

Preserve general assembly minutes, board or managers’ resolutions, meeting invitations, rejected proposals, correspondence, emails and messages showing repeated inability to make necessary decisions.

A court dispute should demonstrate an actual corporate problem rather than merely a deteriorated personal relationship.

Identify Which Decisions Are Blocked

Prepare a detailed list of decisions the company cannot make.

Examples can include approval of financial matters, appointment of management, bank authorization, major contracts, capital requirements, dividend decisions and strategic investments.

The more directly the deadlock affects corporate operations, the more significant it may become legally.

Can One Shareholder Simply Take Control?

Generally, a 50% shareholder should not assume that equal ownership allows unilateral control of the company.

Corporate decisions must comply with the applicable company-law rules, articles of association and valid representation arrangements.

Management Authority Must Be Reviewed Separately

Share ownership and management authority are not necessarily identical.

One shareholder may own 50% while the other shareholder or their nominee controls management or representation. Determine who currently has authority to bind the company.

Check the Trade Registry Records

Current corporate registration records can be critical.

Verify directors or managers, representation arrangements and registered corporate authorities. Internal assumptions about who controls the company may differ from the legally registered position.

Bank Account Control Can Become a Major Issue

In severe disputes, one side may control internet banking, payment approvals or company bank relationships.

Immediately determine the formal banking mandates and whether corporate funds are being used consistently with company interests.

What If the Other Shareholder Withdraws Company Money?

Potential unauthorized transfers should be investigated separately from the deadlock itself.

Obtain accounting records, bank statements and supporting documents and determine whether payments represent legitimate corporate expenses, remuneration, loans, dividends or potentially unauthorized transactions.

Related-Party Transactions Should Be Examined

A shareholder controlling management may redirect contracts or funds toward related companies.

Review suppliers, customers, management fees, loans, asset transfers and other transactions involving affiliates or family members.

Can the Foreign Shareholder Obtain Company Records?

Information and inspection rights depend on the company’s legal form and applicable circumstances.

Where a foreign shareholder is being denied meaningful access to corporate information, formal exercise of shareholder rights may become an important early step.

Preserve Accounting Evidence

Obtain available balance sheets, income statements, ledgers, tax records, bank statements, invoices, shareholder loan records and fixed-asset information.

Corporate litigation frequently becomes an accounting dispute as well as a legal dispute.

General Assembly Strategy Is Important

Even where the parties are equally divided, properly convening meetings can create an important evidentiary record.

Proposals, votes and objections should be documented accurately.

Challenge Unlawful General Assembly Resolutions

If the other shareholder obtains a resolution through an allegedly unlawful procedure, the affected shareholder should immediately evaluate whether the resolution can be challenged under the applicable company-law framework.

Procedural deadlines can be important.

Board Deadlock in a Joint-Stock Company

A joint-stock company may experience paralysis at board level even when shareholder meetings remain possible.

Review board composition, quorum rules, representation powers and the articles of association before deciding which remedy to pursue.

Manager Deadlock in a Limited Liability Company

Limited liability companies can face similar problems where managers cannot cooperate or where shareholder-manager relationships collapse.

Manager appointment, removal, representation and liability issues should be examined together.

Can a Manager or Director Be Removed?

Potentially, depending on the company’s legal form, corporate arrangements and grounds relied upon.

Where ordinary corporate mechanisms are blocked, judicial remedies may become relevant in circumstances recognized by Turkish company law.

Director and Manager Liability May Be Separate From Deadlock

If a director or manager breaches legal or corporate duties and causes loss to the company, potential liability claims should be analyzed separately.

A deadlock should not conceal identifiable misconduct.

Can the Court Appoint a Trustee?

Requests for court intervention in company management require a specific legal basis and strong justification. A trustee should not be treated as an automatic remedy whenever shareholders disagree.

The requested measure must be proportionate to the actual corporate risk.

Interim Injunctions May Be Critical

Where there is an immediate risk of company assets being transferred, bank funds being dissipated, records being destroyed or disputed corporate actions being implemented, interim judicial protection may need to be evaluated.

The appropriate request depends on the specific threat and underlying claim.

Asset Preservation Should Be Targeted

A shareholder seeking interim protection should identify the actual risk.

Courts generally need concrete facts supporting the requested restriction. Broad requests that would unnecessarily paralyze the entire company may be more difficult to justify.

Can Company Assets Be Frozen?

Potential protective measures depend on the nature of the claim and procedural requirements.

The shareholder should distinguish company property from the personal property of another shareholder.

What If the Other Shareholder Transfers Assets to Another Company?

Investigate the consideration, relationship between the companies, decision-making process and commercial justification.

Potential claims can involve corporate liability, invalidity of corporate action or other remedies depending on the facts.

Capital Increase Can Become a Deadlock Weapon

A proposed capital increase can create substantial conflict where one shareholder claims additional financing is necessary while the other believes the transaction is intended to dilute their position.

Review the company’s genuine financing needs, resolution procedure and shareholder rights carefully.

Dividend Disputes Are Common

One shareholder may demand distribution while the other insists that profits remain within the business.

Dividend decisions must be evaluated under company law, financial statements and the company’s legitimate commercial needs.

Shareholder Loans Should Be Investigated

In many closely held companies, shareholders finance operations through loans.

Determine the amounts advanced by each shareholder, repayment terms, accounting treatment and whether one side has received preferential repayment.

Can One Shareholder Force the Other to Sell?

There is no universal rule allowing a 50% shareholder simply to compel the other 50% shareholder to sell because the relationship has deteriorated.

Any forced exit must have a valid contractual or statutory legal basis.

Negotiated Buyout Is Often Considered

Commercial settlement may involve one shareholder purchasing the other’s shares.

However, valuation, payment security, warranties, company debts and release of personal guarantees should be addressed carefully.

Independent Share Valuation Can Be Essential

Where the parties disagree about price, an independent valuation may become necessary.

Valuation should examine assets, liabilities, earnings, cash flow, related-party balances and potential contingent liabilities.

Hidden Liabilities Must Be Considered Before Exit

A foreign shareholder selling shares should investigate tax, customs, employment, litigation and other liabilities before agreeing on a price or broad release.

A 50% shareholding cannot be valued accurately without understanding the company’s underlying financial condition.

Can a Foreign Shareholder Seek Dissolution of the Company?

In sufficiently serious circumstances, dissolution proceedings may become relevant under Turkish company law.

This is a major remedy and should not be treated as the automatic response to every shareholder disagreement.

Just Cause Can Become Central

For certain judicial dissolution remedies, the existence of legally sufficient grounds is critical.

Persistent paralysis, serious abuse of shareholder rights, exclusion from management or other substantial circumstances may become relevant depending on the company’s legal form and facts.

Dissolution Is Not Necessarily the Only Possible Judicial Outcome

In company-law disputes where dissolution is requested, Turkish law may permit the court, depending on the applicable provision and circumstances, to consider alternative solutions instead of immediately terminating an economically viable company.

This can make share-value and exit issues particularly important.

Exit Payment May Become Relevant

Depending on the legal basis and company type, a dispute may ultimately involve the departing shareholder receiving the real value of their shares rather than the company being dissolved.

Accurate valuation evidence therefore becomes strategically important from the beginning.

Foreign Shareholders Should Review Personal Guarantees

Foreign investors frequently guarantee company loans, leases or supplier obligations personally.

A share exit does not automatically release a shareholder from third-party guarantees.

Any settlement should address releases from banks and contractual counterparties separately.

Intellectual Property Should Be Checked

Determine whether trademarks, software, patents, domain names or other valuable intellectual property belong to the company or personally to one shareholder.

Ownership disputes can significantly affect company valuation and business continuity.

Control of Digital Assets Matters

Review access to corporate email, accounting software, customer databases, websites, cloud systems and other digital infrastructure.

Loss of access can cause substantial operational damage even before formal corporate control is resolved.

Employees Should Not Become Instruments of the Dispute

Competing instructions from equal shareholders can destabilize the workforce.

Management and representation authority should be clarified to prevent unauthorized commitments and operational confusion.

Preserve Evidence of Business Damage

If the deadlock causes lost contracts, inability to obtain financing, project cancellation or customer loss, preserve documentary evidence.

This information can help demonstrate the seriousness of the paralysis.

Foreign Shareholder Strategy in 2026

A foreign shareholder facing a 50/50 Turkish company deadlock should approach the dispute simultaneously as a corporate-governance, asset-protection and exit-planning problem.

The immediate objective should be to understand who legally controls management and representation, protect company assets, obtain financial information, document blocked decisions and prevent irreversible transactions.

Immediate Legal Action Checklist

The foreign shareholder should obtain the articles of association and shareholders’ agreement, check current registry records, identify directors and managers, review bank authority, secure corporate and accounting records, document failed meetings, investigate related-party transactions, assess interim protection, calculate share value, review personal guarantees and determine whether negotiation, corporate litigation, management proceedings, an exit mechanism or judicial dissolution offers the appropriate route.

Frequently Asked Questions

Can a 50% shareholder control a Turkish company alone?

Normally, 50% ownership does not automatically provide unilateral control. Voting, management and representation rights depend on the company structure and applicable corporate rules.

What happens if two 50% shareholders cannot agree on anything?

Persistent deadlock may lead to corporate litigation, management disputes, contractual exit procedures or, in serious circumstances, judicial dissolution or another legally available solution.

Can the foreign shareholder obtain an injunction?

Potentially, where the legal requirements are satisfied and there is a concrete risk requiring interim protection.

Can the court appoint someone to manage the company?

Court intervention in management requires an appropriate legal basis and circumstances justifying the requested measure. It is not automatic merely because shareholders disagree.

Can one shareholder force the other to sell their shares?

Not simply because ownership is 50/50. A compulsory exit requires an applicable contractual or statutory basis.

Can the foreign shareholder ask the court to dissolve the company?

Potentially, where the requirements of the relevant Turkish company-law provisions are satisfied. The seriousness and duration of the deadlock can be important.

What if the other shareholder is transferring company money?

Bank and accounting records should be obtained immediately. Potential unauthorized transactions may support separate corporate, liability or protective claims.

What if the other shareholder refuses to provide company records?

The foreign shareholder should formally evaluate and exercise the information and inspection rights available under the applicable company structure.

Should the foreign shareholder accept a buyout?

The commercial decision belongs to the shareholder, but any proposed buyout should be assessed against an independent valuation, company liabilities, payment security and release from personal guarantees.

What should a foreign shareholder do first?

Secure the corporate evidence before the dispute escalates. Confirm management and representation authority, obtain financial and bank records, document the decisions being blocked and investigate whether company assets are at immediate risk. The appropriate court remedy should then be selected according to the company’s legal form and the specific source of the deadlock.

Client-Focused Legal Support for 50/50 Shareholder Deadlocks in Turkey

A 50/50 shareholder dispute can threaten company assets, bank accounts, management authority, contracts, investments and the value of the foreign shareholder’s entire investment in Turkey. Fırat Fesih Kaya Law Office assists foreign investors and international shareholders in Turkish company deadlocks, shareholder disputes, management conflicts, corporate injunction proceedings, director and manager liability claims, share valuation disputes, negotiated exits and judicial dissolution proceedings.

Lawyer Fırat Fesih Kaya provides legal assistance in developing urgent asset-protection strategies, reviewing corporate records and shareholder agreements, challenging disputed corporate actions and pursuing appropriate judicial remedies when equal ownership makes ordinary corporate decision-making impossible.

Phone: +90 312 434 22 22

Mobile: +90 532 769 22 22

Email: info@firatfesihkaya.av.tr

Address: Mevlana Boulevard No:221, Yıldırım Tower, Office No:148, 06520 Balgat, Çankaya, Ankara, Turkey