Third-party due diligence in Turkey plays a critical role in mergers and acquisitions (M&A), helping investors, buyers, or partners assess legal, financial, and reputational risks before proceeding with transactions. At ER&GUN&ER Turkish Law Firm, a trusted Istanbul Lawyer Firm, we provide professional due diligence services aligned with Turkish Commercial Law.
What is Third-Party Due Diligence?
Third-party due diligence refers to a comprehensive legal, financial, and operational review of a target company before a transaction. It is not specifically regulated under the Turkish Code of Obligations or the Turkish Commercial Code, but it has become standard practice for corporate transactions.
Key Legal Areas Reviewed
- Corporate Structure and Records: Review of articles of association, shareholder agreements (SHA), trade registry filings, and board resolutions
- Litigation and Legal Exposure: Review of civil, commercial, labor, administrative, and criminal cases involving the company
- Tax and Regulatory Compliance: Check for outstanding obligations or compliance breaches with MASAK, Revenue Administration, and other regulators
- Contracts and Liabilities: Analysis of lease agreements, service contracts, IP licensing, loan documents, and customer agreements
- Intellectual Property: Review of trademark, patent, and domain ownership, applications, and disputes
Third-Party Due Diligence Steps
The due diligence process typically includes the following stages:
- Accessing public data from government databases (e.g., tax office, trade registry, Social Security Institution)
- Gathering internal records from the target company, including HR data, financial statements, and board documents
- Analyzing risks and liabilities (pending lawsuits, encumbrances, breaches of agreement)
- Preparing a due diligence report summarizing findings and recommendations
Why Third-Party Due Diligence Matters
Due diligence reduces risk exposure, enhances negotiation power, and allows buyers to:
- Identify red flags before closing
- Renegotiate terms or request warranties and indemnities
- Ensure compliance with Turkish law during mergers and acquisitions
Our English-speaking Turkish lawyers guide both local and international clients through due diligence to facilitate secure transactions.
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