Circular
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The exemption for exchange losses and for 2020 and 2021 lease, depreciation and personnel expenses in capital loss and over-indebtedness calculations under Article 376 of Turkish Commercial Code (TTK) No. 6102 has been extended by another year. With the Communiqué published in Official Gazette No. 33396 of 10.10.2026, the date "1/1/2027" in provisional article 1 of the Communiqué on the Procedures and Principles for the Application of Article 376 of the TTK has been changed to "1/1/2028".
If, according to the latest annual balance sheet, half of the total of share capital and legal reserves is lost due to losses, the board of directors immediately calls the general assembly and presents the remedial measures it considers appropriate. If the uncovered portion reaches two thirds, the company is automatically dissolved unless the general assembly decides to make do with one third of the capital or to restore the capital. Where over-indebtedness is suspected, the board of directors must prepare an interim balance sheet and, if the assets are not sufficient to cover creditors' claims, notify the commercial court of first instance.
Under provisional article 1, the following amounts may be disregarded in capital loss or over-indebtedness calculations made until 1/1/2028:
These amounts must be calculated without double counting. No entry is made for these calculations in the financial statements prepared under Article 13 of the Communiqué (in accordance with TTK art. 88); the situation is disclosed for information in the notes.
The amendment entered into force on the Communiqué's publication date, 10.10.2026.
Companies with foreign currency debt whose equity has been eroded by exchange rate increases can continue to use this exemption in TTK 376 assessments made until 1/1/2028. If the exemption is used, the amounts disregarded and the calculation method must be disclosed in the notes to the financial statements.
This circular is for general information only. Please contact us about your specific situation. The Turkish original is available here.
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