With the Law No. 7262[1], a notification requirement is introduced so that any information relating to the owners of bearer share certificates of non-public joint-stock companies and their respective shareholdings are henceforth notified to the Central Registry Agency (the “CRA”). In this context, the Ministry of Commerce has been authorised to oversee that the commercial books of such companies are kept electronically.

Amendments to Holders of Bearer Share Certificates

• The ownership status of bearer share certificate holders must be notified to the CRA in order for such shareholders to be able to exercise their respective shareholder rights. The date of notification will be taken as a basis for exercising such rights.


• A transfer of bearer share certificates will be valid and effective only if the transferee notifies the CRA of such transfer and the transferor effects physical delivery of such certificates.


• The detailed rules and procedures regarding notification and registration in respect of holders of bearer share certificates will be regulated by a communiqué to be issued by the Ministry of Commerce.

The amendments will come into effect on 1 April 2021.

Pursuant to the Provisional Article 14 introduced to the Commercial Code[2], holders of bearer share certificates must apply to the relevant joint-stock company until 31 December 2021 with information required for such notification. The board of directors of such joint-stock company must then undertake the relevant notification to the CRA within five business days. Administrative fines are to be imposed for non-compliance.

Keeping Books Electronically

The Ministry of Commerce has been given authority to enforce that the following is to be kept electronically: share ledger, board of directors’ resolution book and general assembly meeting book. However, the provisions of the Capital Market Law[3] are reserved. This amendment entered into force on 31 December 2020.

Conclusion

These amendments have been primarily introduced to combat money laundering and financing of terrorist activities but also to create further transparency. Hence, the requirement to notify the identity of holders of bearer share certificates and the keeping of company books on an electronic platform. A regulation on this matter is expected from the Ministry of Commerce in the near future.