The Resolution of the General Assembly in Limited Liability Company Share Transfer and Its Annulment

Abstract

The transfer of shares in a limited-liability company is subject to research and court rulings. Without a doubt, the general assembly's resolution is one of the most important measures. Hence, upon notification regarding the transfer agreement, the general assembly can approve or decline the transfer. With the approval, the transfer becomes valid, and ownership of the share transfers to the buyer. However, if the general assembly declines the transfer within three months after notification, the transfer agreement becomes void until the resolution of the general assembly, and the share can be subject to interim legal transactions. Consequently, conflicts arise when the company's will is required in addition to the transferrer's will. One of the most likely conflicts to arise is that over the annulment of the resolution. Annulment cases regarding the decision of approval or rejection of the transfer have different issues to resolve; with the annulment of the resolution of rejection, the determination of an affirmative resolution can be demanded. Following Swiss and German law, this type of case must be acknowledged by Turkish law, and through this case, the transfer agreement can be deemed valid. This way, the interest of the transferrer will be protected. The abovementioned issues are addressed in this study by determining the legal aspects of the resolution of the general assembly in a limited-liability company share transfer in light of doctrine and court rulings.