SSS · Transaction Advisory

Is an equal-share (50-50) partnership with a foreign partner risky?

An equal-share structure does carry the risk of deadlock: when the partners cannot agree there is no majority to break the tie, and the company can stop being able to decide anything at all…

Updated · July 20261 min readCategory · Transaction Advisory
Short answer

An equal-share structure does carry the risk of deadlock: when the partners cannot agree there is no majority to break the tie, and the company can stop being able to decide anything at all. But that risk is largely a drafting problem, and it can be managed.At formation we write the graduated mechanisms into the shareholders’ agreement — escalation to senio…

An equal-share structure does carry the risk of deadlock: when the partners cannot agree there is no majority to break the tie, and the company can stop being able to decide anything at all. But that risk is largely a drafting problem, and it can be managed.

At formation we write the graduated mechanisms into the shareholders’ agreement — escalation to senior management, an independent board member or a neutral arbitrator, call and put options, and a last-resort exit route — so that each engages before the next becomes necessary. Privileged shares, the matters reserved for a veto and the composition of the board are then balanced under the Turkish Commercial Code (No. 6102). The risk comes far less from the ratio than from the quality of the agreement: a well-built 50-50 stops either side dominating, which protects both partners rather than weakening the structure.

Shall we apply this matter to your situation?

Tell us your specific situation in a few sentences; we'll assess it with the right team.

Get in touch
This content is for general information only and does not constitute legal advice. Please contact our team for an assessment of your specific circumstances.

Related questions

Different regimes apply to Turkish companies with foreign capital and to foreign legal entities; the permit processes vary according to the field of activity, the region, and military-security restrictions. We determine the acquisition route suited to your structure and conduct…

As a rule yes, but most relationships continue without interruption. In a merger, a demerger or a change of legal form, assets, rights and obligations pass to the new structure largely by universal succession under the Turkish Commercial Code (No. 6102). For employment contracts…

For most steps, no. The greater part of the incorporation, tax and banking work can be done without you travelling, on a power of attorney issued at a consulate or executed abroad, apostilled under the Hague Convention and translated into Turkish. The Foreign Direct Investment L…

Transaction Advisory

The right start means a predictable process.

From the first meeting to completion of the work; let's plan every step transparently.