COVID-19 update: New limitations to dividend distributions introduced

Posted in COVID-19

The omnibus law published in the Official Gazette on April 17, 2020 introduced new limitations to dividend distributions of companies to preserve their equities. These limitations will remain in effect until September 30, 2020 and include the following:

  • Dividends to be distributed cannot exceed 25% of a company’s net profit in 2019.
  • Retained earnings and free reserves cannot be distributed.
  • Board of directors cannot distribute advance dividend.

The time period can be extended (or shortened) for a period of three months upon a decision by the President of the Republic.

Outstanding dividend payments authorized by the general assembly prior to April 17, 2020 must be postponed to a date later than September 30, 2020 to the extent such dividend payments exceed 25% of the company’s net profit in 2019.


Turkey offers significant growth potential to international investors and developers, in addition to domestic businesses. Our understanding of the legal, economic and political landscape in Turkey is second to none and we understand that changes impacting your business can arise rapidly and vary significantly across the region.

Through Inside Turkey, we aim to keep you updated on domestic and international developments, as well as providing insights into how to navigate the current market across key industry sectors. Inside Turkey will also feature legal developments outside of Turkey that affect Turkish companies doing business abroad.

Blog Network