Share Purchase Agreements (SPAs) are the cornerstone of mergers and acquisitions (M&A) in Turkey. These legally binding contracts govern the transfer of equity shares in a limited company (LTD) or joint stock company (A.Ş.), and set the framework for payment, warranties, closing conditions, and dispute resolution. Drafting a proper SPA under Turkish law is essential to mitigate risks, protect investor interests, and ensure compliance. A strategic Turkish Law Firm plays a vital role throughout this transaction.
At ER&GUN&ER Law Firm, our English Speaking Turkish Lawyers draft, review, and negotiate SPAs for domestic and international buyers, sellers, and investment funds. We provide complete support from legal due diligence to post-closing obligations. As a best lawyer firm in Turkey for corporate law, we understand the nuances of Turkish commercial contracts, foreign capital rules, and M&A risk allocation.
What Is a Share Purchase Agreement (SPA)?
An SPA is a contract where a shareholder agrees to sell their shares in a company to another party, typically for a negotiated price and under specific terms. Under Turkish Commercial Code and Turkish Code of Obligations, SPAs must clearly define:
- Parties to the transaction
- Percentage and class of shares sold
- Purchase price and payment method
- Warranties and representations
- Conditions precedent and closing obligations
- Governing law and dispute resolution
Our Turkish Law Firm ensures that all SPA clauses are enforceable, especially in cross-border M&A deals where foreign investors are involved.
Legal Requirements for Share Transfers
The transfer of shares in Turkish companies varies based on company type:
- Joint Stock Company (A.Ş.): Share transfer is free unless restricted by Articles of Association; no notary required
- Limited Company (LTD): Share transfer must be notarized and registered with the Trade Registry
We coordinate all notary, registry, and tax filings to finalize the transaction legally and cleanly.
Warranties and Indemnity Clauses in SPAs
To protect the buyer, SPAs in Turkey include a range of warranties and indemnities related to:
- Tax compliance
- Pending litigation
- Financial statements accuracy
- Employee liabilities
- Environmental and zoning risks
- Validity of licenses and permits
As a Turkish Law Firm experienced in M&A, we draft warranty schedules and define indemnification caps, baskets, and survival periods in line with market standards.
Legal Due Diligence Before Signing an SPA
Before executing a Share Purchase Agreement in Turkey, the buyer typically performs a full legal, financial, and operational due diligence. Our English Speaking Turkish Lawyers conduct comprehensive reviews of:
- Company registration and shareholding history
- Pending or historical litigation
- Tax debts and SGK (social security) obligations
- Intellectual property ownership
- Labor contracts and collective agreements
- Real estate titles and encumbrances
Findings are reported in a Legal Due Diligence Report (LDDR), which forms the basis for price negotiation and SPA clauses. As a Turkish Law Firm for corporate transactions, we ensure no legal exposure is overlooked.
Purchase Price and Earn-Out Mechanisms
SPAs in Turkey may include various payment structures, including:
- Fixed lump-sum price
- Milestone-based earn-out payments
- Escrow holdbacks for indemnity claims
- Share swaps or stock options (especially in venture deals)
We help clients structure pricing models that align with business objectives and risk tolerance, while ensuring tax and legal compliance.
Signing, Closing, and Post-Closing Actions
The SPA process includes distinct stages:
- Signing: Formal execution of the SPA
- Closing: Transfer of shares, funds, and board resolutions
- Post-closing: Tax notifications, commercial registry updates, employee notices
Our best lawyer firm in Turkey drafts closing checklists, coordinates notary appointments, and files all required documentation with the Trade Registry and tax offices.
Internal Resources for M&A and Share Transfers
- Forming a Company in Turkey
- Joint Venture Structuring in Turkey
- Commercial Contract Drafting in Turkey
- Director Liability in Turkish Companies
- Corporate Tax for Foreign-Owned Companies
Frequently Asked Questions (FAQs)
- Is notarization required for share transfers in Turkey? Yes, for LTD companies. Not required for A.Ş. unless the articles demand it.
- Do SPAs require Trade Registry filing? Yes, share transfer must be registered for enforceability and tax purposes.
- Can foreign investors buy 100% of a Turkish company? Yes. Turkey allows full foreign ownership in most sectors.
- What happens if warranties are breached? The buyer can claim indemnification based on the SPA terms and court enforcement if needed.
- Is tax advice necessary for SPAs? Absolutely. Structuring payments and shares incorrectly can lead to avoidable tax burdens.
- Can the SPA include a non-compete clause? Yes. Reasonable time, scope, and geography restrictions are enforceable in Turkey.
- Are SPAs enforceable in English? A Turkish version is required for court enforcement. We draft dual-language agreements.
- How can a Turkish Law Firm assist? We handle legal due diligence, draft the SPA, coordinate notary and registry steps, and represent you in dispute resolution if needed.
Work with a Turkish Law Firm for SPA Drafting and Execution
Share Purchase Agreements are more than just sale documents—they are legal risk maps that define the future of a corporate transaction. In Turkey, SPA drafting and share transfer execution require precision, regulatory knowledge, and bilingual legal fluency.
At ER&GUN&ER Law Firm, our English Speaking Turkish Lawyers support foreign and domestic investors through every stage of Turkish M&A transactions. As a leading Turkish Law Firm in corporate law, we ensure your share deals are efficient, enforceable, and fully compliant with Turkish commercial law.