Recent Development
The Capital Markets Board of Türkiye (“CMB“), through its resolution dated 28 August 2026 and numbered 52/1589 (the “Resolution“), introduced a requirement to obtain CMB approval for transfers of public company shares by certain shareholders.
What’s New?
Pursuant to the Resolution, during any rolling 12-month period, shareholders of a public company who either (a) directly hold, individually or together with persons acting in concert, more than 20% of the public company’s share capital, or (b) hold privileged shares granting the right to nominate or appoint at least one member of the board of directors, cannot sell off-exchange, including through private order, wholesale transactions conducted under the Borsa Istanbul Wholesale Transactions Procedure, or off-market transfers/book-entry transfers:
– shares representing more than 2% of the public company’s share capital or voting rights, if the public company’s free float exceeds 50%; or
– shares representing more than 4% of the public company’s share capital or voting rights, if the public company’s free float is 50% or less.
For purposes of determining the applicable threshold, the free float in effect on the date of the relevant sale will be taken into account.
Where shareholders wish to transfer shares in excess of the above thresholds through any of the methods described above, an information memorandum must be prepared prior to the transfer and submitted to the CMB for approval, without regard to the conditions set out under Article 27/5 (regarding the disclosure of the submission and the result thereof) and Article 15 (regarding the conversion of non-tradeable shares into tradeable shares) of the CMB’s Share Communiqué numbered VII-128.1. Unless the CMB approves the information memorandum, such transfers may not be effected through private orders or wholesale transactions on-exchange, nor may the shares be transferred through off-market or book-entry transfers. Responsibility for compliance with these requirements rests with both the selling shareholder and the investment institution intermediating the sale. Off-market sales completed prior to 29 August 2026 will not be taken into account in calculating the applicable thresholds for any rolling 12-month period.
Conclusion
The Resolution introduces a new regulatory oversight mechanism for sale of shares of public companies by requiring prior CMB approval for off-exchange sales, as well as sales effected on-exchange through private orders or wholesale transactions, where certain thresholds are exceeded.
The new regime is anticipated to have a negative impact on M&A transactions where the target is a public company, as well as on block sales carried out through accelerated bookbuilding offerings to foreign and institutional investors.
As a result of this regulation, a significant number of M&A transactions involving public companies are expected to require CMB approval. Furthermore, block sales will no longer be capable of being executed swiftly without prior CMB approval by rendering the relevant shares eligible for trading through the wholesale transaction method.
