The pre-emption right is a special right that gives the shareholders in the case of joint ownership of a real estate the right to first purchase the sold share in the event that the other shareholder sells his share to a third party. This right, which is regulated in the Turkish Civil Code and imposes various restrictions on real estate ownership, aims to protect the rights of joint owners on the real estate. The pre-emption right can be used under contractual and legally recognized conditions in the sale of real estate. In this article, the conditions for the use of the pre-emption right, the litigation process, legal limitations and exceptions will be discussed. The scope of the pre-emption right and its legal status in practice will be explained in detail and the important points for real estate owners will be evaluated.
1. What is the right of pre-emption?
The preemption right is a right that allows other shareholders to purchase the sold share in a real estate owned by a joint ownership in the event that the share is sold to a third party. The preemption right, also known as the preemption right, aims to prevent other shareholders who have the right of ownership of the real estate from selling the real estate to outside parties and preventing a foreign person from becoming a partner in the real estate. This right is regulated under the Turkish Civil Code (TCC) and is a protective tool that is only valid in joint ownership relationships. The preemption right provides security especially between the shareholders of the real estate and is used as a security for the shareholders to continue their ownership relationships.
2. Legal Basis for the Right of Pre-emption
The pre-emption right has a legal basis in line with the relevant provisions of the Turkish Civil Code. Articles 731 and 732 of the TMK regulate the scope and conditions of use of this right. Article 35 of the Constitution protects the right of ownership and makes it possible to limit the right of ownership only through law. In this context, the pre-emption right defines the right of ownership as a restriction arising from private law and enables the shareholders to protect their immovable property. According to legal regulations, the pre-emption right arises when the co-ownership relationship is established and becomes usable with the sale of the share.
3. Types of Pre-emption Rights: Differences Between Legal and Contractual Rights
The pre-emption right is evaluated in two main types: legal and contractual. According to the Turkish Civil Code, the legal pre-emption right is a right granted to all stakeholders in real estates that are in a shared ownership relationship. This right ensures that other stakeholders become the primary purchasers in the event that the real estate ownership is transferred to a third party. The legal pre-emption right is considered valid without having to be registered in the real estate title deed. On the other hand, the pre-emption right arising from the contract is a right created by a special agreement made between the stakeholders. This type of pre-emption right is made between the parties in a way that ensures that the priority purchaser is during the transfer of the real estate. The pre-emption right arising from the contract can also be effective against third parties by being annotated in the title deed. This right is used in accordance with the conditions determined between the parties and has a nature that limits the transfer of ownership.
4. Legal Pre-emption Right: Definition Under the Turkish Civil Code
The legal pre-emption right is regulated within the framework of Article 732 of the Turkish Civil Code, and in the event that a shareholder sells his/her share to a third party in real estates owned through shared ownership, it allows other shareholders to purchase this share first. The legal pre-emption right aims to protect the unity among the real estate shareholders and protects the ownership relations of the shareholders by preventing the real estate from being transferred to other persons. In order to exercise the legal pre-emption right, the real estate must be sold to a person other than the shareholders; the pre-emption right is not applied in sales between shareholders. This right is activated with the sale of the real estate and the shareholder who wants to take over must file a lawsuit against the buyer within the specified period. As stated in Article 731 of the Turkish Civil Code, the legal pre-emption right does not need to be registered in the land registry and is directly effective.
5. Contractual Pre-emption Rights and Conditions
The contractual pre-emption right is created by a special agreement between the parties. This right provides the opportunity to be the primary buyer in the sale of the real estate and can be used in accordance with the provisions of the contract. In order for the contractual pre-emption right to be valid, the contract must be made in writing and annotated to the title deed. Annotating to the title deed ensures that this right is valid not only between the parties but also against third parties. The pre-emption right annotated to the title deed is valid for a certain period of time and the right expires at the end of this period. The contractual pre-emption right, unlike the legal pre-emption right, is dependent on the terms of the contract and is generally created within the framework of private property relations. In order for this right to be used effectively, the right holder must use the pre-emption right within a certain period of time after being notified of the sale transaction.
6. The Nature of the Right of Pre-emption Relating to Property and Its Consequences
The pre-emption right is defined as a right attached to the property on the real estate. This means that, depending on the property right, the pre-emption right belongs to the person who has a share in the real estate. In any transfer of ownership of the real estate, the pre-emption right also passes to the new shareholder. This feature reveals that the pre-emption right is not an independent right but a right attached to the real estate ownership. For example, a shareholder who transfers his share in the real estate leaves the pre-emption right to the new owner when he makes the transfer. The fact that the pre-emption right is attached to the property serves to regularize the property relations between the shareholders. In this way, the shareholders can protect their rights on the real estate and prevent the involvement of foreign persons in the real estate. This feature aims to ensure the continuity of the property rights on the real estate.
7. Scope of Pre-emption Right in Shared Ownership
Shared ownership is valid when a real estate is owned by more than one person, and each shareholder shares the entire real estate to a certain extent, not a certain part of the real estate. In shared ownership, the right of pre-emption only comes into play when the real estate is in the form of shared ownership. When a shareholder wants to sell his share to a third party, the other shareholders can purchase this share with priority by exercising the right of pre-emption. Since this right can only be applied within a shared ownership relationship, the heirs or the flat owners do not have such a right. The right of pre-emption arises when the shared ownership relationship is established and is valid without the need for a written contract between the shareholders before any transfer is made. It is of great importance in order to ensure solidarity between the shareholders and to prevent the real estate from being lost to foreign persons.
8. What are the Conditions for Using the Right of Pre-emption?
In order to use the pre-emption right, certain conditions must be met. First, the share on the real estate must be sold to a third party. The pre-emption right cannot be used in sales between shareholders. In addition, the sale transaction must have taken place; the pre-emption right cannot be used in cases such as donation or exchange of shares. In order to use the pre-emption right, the sale must be notified to the other shareholders; this notification must be made through a notary public and a pre-emption lawsuit must be filed within three months following the notification. These conditions ensure that the pre-emption right is used in accordance with its purpose and prevents abuse of the right. In this way, the balance between the real estate shareholders is maintained and it is ensured that the transfers to be made on the real estate remain within the legal framework.
9. Status of Pre-emption Rights in Sales Between Stakeholders
The pre-emption right can only be used in sales to third parties who are not shareholders. Therefore, in sales between shareholders, other shareholders cannot use the pre-emption right. For example, if there are three shareholders in a real estate and one of the shareholders wants to sell his share to the other shareholder, it is not possible for the third shareholder to use the pre-emption right. This situation ensures that the real estate ownership can be freely transferred between the shareholders and aims to protect the rights only against third parties. The decisions of the Court of Cassation also support this situation and emphasize that the pre-emption right cannot be used in sales between shareholders . These decisions are an important guide to prevent disputes that may arise in practice and ensure that the rights of the shareholders are protected.
10. Use of Pre-emption Right in Sales to Third Parties
The main purpose of the pre-emption right is to grant the other stakeholders the right to purchase this share in the event that the real estate in joint ownership is sold to a person other than the stakeholders. When a stakeholder in a joint ownership relationship wants to sell his/her share to a third party, the other stakeholders can purchase the share in the real estate by using the pre-emption right within a certain period of time after learning about this sale. In sales made to a third party, the stakeholders must file a lawsuit by using the pre-emption right within three months from the date of notification from the notary. This period is considered a limitation period and it is not possible to use the pre-emption right after it has elapsed. This rule was established to ensure the continuity of the property rights on the real estate and to contribute to the rapid transfer of the property of the real estate.
11. Transfers Not Within the Scope of Pre-emption Rights
The pre-emption right is a right that can only be used in the event of the sale of the share. The pre-emption right cannot be used in other transfer methods, namely donation, barter or construction contract in return for flats. This ensures that the pre-emption right is only valid in sales transactions and ensures that the right is used in accordance with its purpose. For example, if a shareholder transfers his/her share to a contractor through a construction contract in return for flats, this transaction is not considered a sale, so other shareholders cannot use the pre-emption right. This situation is also supported by the decisions of the Court of Cassation. The Court of Cassation states that transfers made in return for land shares are not a sales relationship and that the pre-emption right can only be used in sales transactions. These decisions clarify the limits and scope of the pre-emption right and ensure that the relations between the stakeholders are carried out in a healthier manner.
12. Applications of Pre-emption Rights in Supreme Court Decisions
The Court of Cassation has created various precedents regarding the application of the pre-emption right. These precedents are instructive regarding the scope, use and limits of the right. For example, in the decision numbered 2009/8644 of the 6th Civil Chamber of the Court of Cassation, it was stated that the pre-emption right can only be used in sales made to third parties who are not shareholders, and that this right cannot be used in sales between shareholders. This decision clearly states that sales transactions between shareholders are excluded from the scope of use of the pre-emption right. Another issue frequently emphasized in the decisions of the Court of Cassation regarding the pre-emption right is that the pre-emption right cannot be used in sales made by forced auction. It is concluded that the pre-emption right should be disabled since such sales are considered as a compulsory transfer transaction.
13. Situations in which the right of pre-emption cannot be exercised in sales through forced auctions
Sales made by forced auction mean that the real estate is sold under a legal obligation. For example, if a real estate is sold through enforcement due to debt, it is not possible for other stakeholders to use the pre-emption right. Such sales are excluded from the scope of the pre-emption right since they are not a voluntary transfer transaction between stakeholders. As clearly stated in Article 733 of the Turkish Civil Code, the pre-emption right cannot be used in sales made by forced auction. The reason why the pre-emption right cannot be used in sales made by forced auction is based on the grounds that the use of this right would impose an unnecessary burden in cases where the ownership is transferred by compulsory transfer. This situation contributes to the fair distribution of property rights over the real estate.
14. Periods for the Use of Pre-emption Rights and Limiting Periods
There are certain periods foreseen for the use of pre-emption right. Article 733 of the Turkish Civil Code regulates that pre-emption right can be used within three months from the date of notification of the sale to the rightful owner, and in any case within two years. These periods are defined as limitation periods and the pre-emption right ends when these periods expire. If notification is made, the three-month period starts from the date of notification of the sale to the rightful owner through a notary. In case the sale is not notified, the pre-emption right must be used within two years from the date of sale. The limitation nature of these periods is a measure to prevent the abuse of the pre-emption right and to ensure the security of the real estate transfer.
15. Removal of Pre-emption Right by Waiver
The pre-emption right can be revoked by mutual consent of the shareholders or by waiver with a written statement. Waiver means that the shareholder renounces the use of the pre-emption right and this waiver is made official by being recorded in the land registry. The waived pre-emption right is also valid against third parties if it is annotated in the land registry. For example, a shareholder may renounce the use of the pre-emption right for a specific sale or may waive this right in favor of all shareholders. In order for the waived pre-emption right to be used again, a new right must be created. In addition, the waiver of the pre-emption right must be made in the presence of the official land registry officer and the waiver must be recorded in the land registry.
16. Limitation of Pre-emption Right by Actual Distribution
De facto division is the situation where the real estate in shared ownership is divided between the stakeholders based on an agreement. De facto division may limit the use of the pre-emption right. According to the Court of Cassation precedents, if a long-term de facto division has been implemented between the stakeholders and each stakeholder uses a certain part of the real estate, then the use of the pre-emption right may be considered contrary to the rule of honesty. De facto division enables the stakeholders to use the real estate in practice by dividing it into certain areas and thus protect their ownership rights over their own areas. In this case, the acquisition of the share of the other stakeholder by using the pre-emption right may disrupt the usage order of the de facto divided real estate. Therefore, it is supported by the Court of Cassation decisions that the pre-emption right cannot be used in cases where de facto division exists.
17. Status of the Right of Pre-emption in Counterfeit Sales
Collusion refers to fraudulent transactions conducted by the parties to deceive third parties by concealing their true intentions. The right of pre-emption may also come into play in collusive sales. For example, if a shareholder pretends to sell his share but in reality has made a collusive transaction for a different purpose, the rights of other shareholders to exercise the right of pre-emption remain reserved. The decisions of the Court of Cassation state that collusive transactions do not prevent the exercise of the right of pre-emption and that the right holders may exercise the right of pre-emption by proving the situation of collusion. In this case, the right holder may prove the collusion by filing a pre-emption lawsuit and purchase the share in the real estate. In such cases, witness statements, documents and other evidence play an important role in determining the collusion.
18. Other Circumstances Precluding the Right of Pre-emption
There are also some situations where the pre-emption right cannot be used. These include donation, barter, transfer through inheritance, expropriation, and contracts for maintenance until death. In addition, the pre-emption right cannot be used in real estates subject to condominium, transfers between shareholders, sales between close relatives, and sales of real estates without title deeds. These exceptional situations are aimed at securing the status of the right holders in joint ownership relationships and preventing the abuse of the pre-emption right. For example, sales between relatives are based on the idea that family ties between the parties should prevent the use of the pre-emption right.
19. The Duties and Powers of the Courts in Pre-emption Cases
The competent court for lawsuits filed for the use of pre-emption right is the Civil Court of First Instance. The lawsuit must be filed in the Civil Court of First Instance where the real estate is located. This jurisdiction rule was determined with the idea that the court of the place where the real estate is located will have more authority over the case and that the situations related to the geographical location of the real estate will be evaluated in the best way. In a pre-emption right lawsuit, the shareholder who wants to use the pre-emption right requests the cancellation of the share sold to a third party and its registration in his/her own name. The plaintiff can exercise this right by accepting to pay the sales price in his/her lawsuit and making the payment. The court evaluates all aspects of the case and makes a decision.
20. Cases where more than one stakeholder exercises the right of pre-emption
If there is more than one stakeholder in a real estate, all stakeholders have the right to use the pre-emption right. However, not every stakeholder is obliged to use this right; this is a completely optional right. In cases where more than one stakeholder uses the pre-emption right, the real estate shares can be shared equally. According to the Supreme Court precedents, even if the share ratios among the stakeholders using the pre-emption right are different, the principle is to benefit from the share subject to the pre-emption right equally. In this case, if some of the stakeholders do not want to use the pre-emption right, the other stakeholders who use their rights can take over the real estate share as the priority purchaser. This practice ensures that the real estate transfer between the stakeholders is carried out fairly.
The pre-emption right is an important protection mechanism regulated in the Turkish Civil Code and granted to co-owners. This right, which secures the property rights on the real estate, provides an effective solution for the shareholders to maintain their property relations and prevent the real estate from being transferred to foreign persons. However, in order for the pre-emption right to be applied, certain conditions must be met and the limitation periods must be taken into account. This right can only be used in the event of the sale of the share and loses its validity in other transfer methods.
The pre-emption right is subject to certain limitations and exceptions in order to prevent abuse. It is regulated under Turkish law that this right cannot be applied in special cases such as forced auction sales and sales between relatives. In addition, there are restrictions on the use of the pre-emption right in cases of long-term de facto division between stakeholders.
The pre-emption right is a very important protection tool for real estate owners and shareholders. This right, which is among the restrictions imposed on the right of ownership in the Turkish legal system, protects the shares of real estate shareholders on the real estate. However, the use of the pre-emption right is subject to certain conditions and there are various restrictions in order to prevent abuse of this right. While the pre-emption right can only be used in certain cases and in sales to third parties, it is not used in cases of relatives and forced auction sales. These comprehensive regulations serve the purpose of protecting the rights of real estate owners, while at the same time contributing to the establishment of a balance in cases where property rights need to be limited.