Legal personality (legal entity)

Legal personality is the recognition of an organisation of persons or assets as an independent subject of law. A legal entity can own property, conclude contracts, sue and be sued, and incur debts in its own name.

Commercial companies, associations, foundations and municipalities are examples under Turkish law. Commercial companies acquire legal personality upon registration with the trade registry. The entity's assets are separate from those of its members: the company's creditors cannot directly pursue the shareholders, and a shareholder's creditors cannot directly reach the company's assets.

Abuse of this separation gives rise to veil-piercing debates. In exceptional cases where a company is used merely as a device to evade obligations, Turkish courts accept that the veil may be lifted and the members held liable.