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A trade name is also called a firm. Today, however, “firm” is generally used to denote a commercial enterprise. For this reason, we will use trade name instead of firm. In this article we discuss the definition of a trade name, where it is used, its elements consisting of the core and additions, and its functions.
Currency note
This article was prepared on the basis of the legislation and practice in force on the date of its publication. There may have been changes since then in the authority competent to grant permission for additions subject to permission and in the names of some of the institutions mentioned in the article. You are advised to consult a lawyer regarding the current position.
There is no express definition of the trade name, which is regulated in Articles 39 to 52 of the Turkish Commercial Code No. 6102. However, Article 39(1) of the Turkish Commercial Code provides: “Every merchant is obliged to carry out transactions relating to its commercial enterprise under its trade name and to sign instruments and other documents relating to its enterprise under that name.”
“Every merchant is obliged to carry out transactions relating to its commercial enterprise under its trade name and to sign instruments and other documents relating to its enterprise under that name.”
Turkish Commercial Code No. 6102, Art. 39/1
Buradan hareketle; a trade name may be defined as the name used by merchants in connection with the transactions of commercial enterprises.[1]
The principal purpose of a trade name is to distinguish the merchant operating a commercial business from others operating commercial businesses. However, it would be wrong to say that it has only a distinguishing function. This is because, in addition to the first paragraph of Article 39 of the Turkish Commercial Code, the second paragraph[2] also considerably broadens the scope of use of the trade name. On the basis of this paragraph, the registered trade name must be written clearly and legibly in a visible place at the commercial business, in addition to the documents underlying the entries in the commercial books and the commercial letters drawn up by the merchant in relation to the commercial business. The scope of use of the trade name does not stop there but has been extended further: if a company is under an obligation to set up a website, it must also display this name on the business’s website.[3]
The trade name used by a merchant in transactions relating to the commercial business consists of two parts: the core and the addition.
The core element, which must be present in a trade name and represents its essential element, is dealt with in the Turkish Commercial Code in two categories depending on whether the trade name is a “subject-matter” or a “personal” name. The core of a subject-matter trade name contains words indicating the company, the type of company and the field of business.[4] In partnerships, the name and surname of at least one of the partners with unlimited liability and wording indicating the company and its type must be included.[5] Finally, the core of personal trade names must contain the name and surname, written without abbreviation, of the merchant who owns the commercial business.[6] Since the cases listed are the essential elements of the trade name, they must be present in every trade name in accordance with the law.[7]
Whether the name is a subject-matter name or a personal name is determined from the core of the trade name, because the core of a subject-matter name refers to the company’s activity, whereas the core of a personal name contains an individual’s first name and surname.[8]
Subject-matter trade name
The core refers to the company’s activity.
Personal trade name
The core contains an individual’s first name and surname.
Core element according to the statutory provisions cited in the footnotes
| Tacir | What must be in the core | Foundations |
|---|---|---|
| Joint stock, limited and cooperative companies | Freely chosen, provided that the field of business is indicated and subject to Article 46 | TTK m. 43 |
| General partnership | The first name and surname of all partners or at least one of the partners, together with words indicating the company and its type | TTK m. 42 |
| Ordinary limited partnership or limited partnership with share capital | The first name and surname of at least one of the general partners, together with words indicating the company and its type | TTK m. 42 |
| Natural person merchant | First name and surname, written without abbreviation | TTK m. 41 |
The merchant may add any addition he or she wishes to the trade name, provided that it does not create a false impression among third parties as to the identity of the merchant, the financial position of the company or the size of the business, and is not contrary to the truth or to public order. Additions, which need not be added to the core (the essential element of the trade name) and are not regarded as essential elements of the trade name, can be examined in four groups: mandatory additions, optional additions, prohibited additions and additions subject to permission.[9]
The article deals with mandatory additions in three cases:
Where more than one identical trade name is registered at any registry office in Türkiye, the trade name with the later registration date must take an addition so that it can be distinguished from the other trade name.[10]
The obligation to make an addition to the trade name is also separately regulated in Article 48[11] of the Turkish Commercial Code. Accordingly, every branch must use the trade name of its head office, indicating that it is a branch. By way of example, a branch located in Cebeci, Ankara, whose head office is Türkiye Vakıflar Bankası T.A.O., must use the trade name Türkiye Vakıflar Bankası T.A.O. Cebeci Şubesi (Cebeci Branch).[12]
Finally, there is the mandatory use of additions indicating liquidation. Commercial companies do not cease to exist immediately after the occurrence of grounds for dissolution but enter into liquidation. A company in liquidation, as a rule, cannot enter into new business. For this reason, in order to inform third parties, the words “in liquidation” (tasfiye halinde) are added to the trade name of a company that has entered liquidation (Articles 269, 328, 533 of the Turkish Commercial Code).[13]
A merchant is free to make additions to the trade name. However, this freedom should not be regarded as unlimited. The addition to be made to the trade name must, first and foremost, not be contrary to the truth or to public order, and must not create a false impression among third parties as to the financial position or identity of the merchant, or the size and importance of the business.[14] In other words, the merchant may use any addition in the trade name, provided that it is not contrary to the law. These additions may describe the identity of the person named in the trade name or the nature of the business, or they may be entirely fanciful.[15]
Article 46 of the Turkish Commercial Code provides: “ Provided that they are not of such a nature as to cause a false impression among third parties as to the identity of the merchant or the size, importance and financial position of the business, and are not contrary to the truth or to public order, additions indicating the characteristics of the business, showing the identities of the persons included in the name, or consisting of fanciful names may be made to any trade name.” Accordingly, where the addition used creates a false impression among third parties as to the financial position or identity of the merchant, or the size and importance of the business, the use of that addition is prohibited. The prohibition on using additions contrary to the truth arises as a consequence of the application of the principle of truthfulness, which is one of the principles governing trade names. The prohibition on using additions contrary to the truth arises as a consequence of the application of the principle of truthfulness, which is one of the principles governing trade names.[16]
The prohibition on using additions contrary to public order is also regulated in the same article. The persons who will determine whether an addition to be used is contrary to public order are all courts, public officials, chambers of commerce and industry, notaries and the Turkish Patent Institute. If they encounter such a situation in any way, they are obliged to provide the necessary information to the competent authorities. It is very difficult to determine which additions are contrary to public order. However, in general, additions that damage the religious, moral, national and cultural values guaranteed by the Constitution, or that are contrary to the principle of the indivisibility of the country and the nation or to the idea of a democratic and secular republic, will be included in this group.[17]
Article 46(3) of the Turkish Commercial Code provides that the words “Türk” (Turkish), “Türkiye”, “Cumhuriyet” (Republic) and “Millî” (National) may be included in a trade name only by decision of the Council of Ministers. Using these words in a trade name would create the impression that the state is connected with the enterprise, and would therefore give the public a false impression of the importance and size of the enterprise. For this reason, the legislator has made the use of such words subject to permission. In practice, using these words requires the enterprise to bear a national identity, to have high financial and technical strength and, most importantly, to have characteristics capable of genuinely representing these words.[18]
The legislator has provided that all merchants must sign instruments and other documents relating to their businesses under this trade name[19], choose a trade name in accordance with the law[20] and use the chosen name for all transactions relating to their businesses. Merchants are known in their commercial lives by their trade names. It is therefore clear that the trade name, which is specific to each merchant, has a function that enables the merchant to be distinguished from other merchants.[21]
Once it enters the market, the trade name, which is unique to each merchant, begins to serve as a guarantee of the nature and quality of the goods or services the merchant produces. The reason is that the consumer who uses the merchant’s goods or services knows through which merchant the goods or services used were placed on the market, and their nature. The consumer will later purchase goods or services according to the image retained in mind, and the trade name will play a guaranteeing and reminding role in relation to the image formed in the consumer’s mind.[22]
Presenting services, goods or commercial ideas to the market by means of a medium, including by using the trade name, constitutes advertising. In our lives, too, trade names appear in many advertisements. For this reason, a merchant who is to choose a trade name should choose it carefully, bearing in mind that the trade name promotes or advertises his or her goods or services. Naturally, it is also clear that the trade name will fulfil its advertising role where its guarantee function and quality are maintained under that trade name.[23]
[1] AYHAN, Rıza; Ticari İşletme Hukuku, Genel Esaslar, 8th ed., 2015, Ankara, p. 291
[2] Article 39 of Turkish Commercial Code No. 6102: “The registered trade name shall be written legibly in a visible place at the commercial business. The merchant’s registry number, trade name and business head office, and, if the merchant is subject to the obligation to set up a website, the address of the registered website, shall be shown in the commercial letters drawn up by the merchant in relation to the business and in the documents on which entries in the commercial books are based. All of this information shall also be published on the company’s website. This website shall also publish, for joint stock companies, the names and surnames of the chair and members of the board of directors and the amount of capital subscribed and paid; for limited liability companies, the names and surnames of the managers and the amount of capital subscribed and paid; and for partnerships limited by shares, the names and surnames of the managers and the amount of capital subscribed and paid.”
[3] AYDOĞAN, Fatih; Markanın Ticaret Unvanına Karşı Korunması, Mevcut Hukukî Durum – Değişiklik (madde) Önerisi – İtiraz Yolu ve/veya Alternatif Çözüm Yolu Önerisi, İÜHFM, Vol. LXXI, No. 2, 2013, p. 32
[4] Article 43 of Turkish Commercial Code No. 6102: “Joint stock companies, limited liability companies and cooperatives may freely choose their trade names, provided that the business activity is indicated and without prejudice to the provision of Article 46.”
[5] Article 42 of Turkish Commercial Code No. 6102: “The trade name of a general partnership shall contain the names and surnames of all the partners or of at least one of the partners, together with wording indicating the company and its type.
The trade name of limited partnerships or partnerships limited by shares shall contain the name and surname of at least one of the general partners, together with wording indicating the company and its type. The names and surnames or trade names of limited partners may not be included in the trade names of these companies.”
[6] Article 41 of Turkish Commercial Code No. 6102: “The trade name of a merchant who is a natural person consists of his or her name and surname, written without abbreviation, together with any additions he or she may make in accordance with Article 46.”
[7] AYHAN, Rıza; Ticari İşletme Hukuku, Genel Esaslar, 8th ed., 2015, Ankara, p. 292
[8] KARAYALÇIN, Yaşar; Ticaret Hukuku Dersleri, Ankara, 1968, p. 373
[9] AYHAN, Rıza; Ticari İşletme Hukuku, Genel Esaslar, 8th ed., 2015, Ankara, p. 292
[10] Article 45 of the Turkish Commercial Code (Law No. 6102): “Where necessary to distinguish a trade name from another name previously registered at any registry office in Turkey, an addition shall be made to it.”
[11] Article 48 of Turkish Commercial Code No. 6102: “Every branch is obliged to use the trade name of its head office, indicating that it is a branch. Additions relating to the branch may be made to this name.
Articles 41 and 45 also apply to the trade name of the branch.
The trade name of a Turkish branch of a business whose head office is located in a foreign country must indicate the locations of the head office and of the branch, and the fact that it is a branch.
[12] ARKAN, Sabih; Ticari İşletme Hukuku, 15th ed., 2011, Ankara, p. 262
[13] KARAYALÇIN, Yaşar; Ticaret Hukuku Dersleri, Ankara, 1968, p. 377
[14] Article 46/I of Turkish Commercial Code No. 6102: “ Provided that they are not of such a nature as to cause a false impression among third parties as to the identity of the merchant or the size, importance and financial position of the business, and are not contrary to the truth or to public order, additions indicating the characteristics of the business, showing the identities of the persons included in the name, or consisting of fanciful names may be made to any trade name.”
[15] ARKAN, Sabih; Ticari İşletme Hukuku, 15th ed., 2011, Ankara, p. 263
[16] KARAYALÇIN, Yaşar; Ticaret Hukuku Dersleri, Ankara, 1968, p. 374
[17] KORKMAZ, Şerife; Ticaret Unvanının Korunması ve Marka İlişkisi, 2010, Ankara, p. 41
[18] Ibid., p. 42
[19] Article 39 of Turkish Commercial Code No. 6102: “Every merchant is obliged to carry out transactions relating to his or her commercial business under the trade name and to sign instruments and other documents relating to the business under this name.”
[20] Article 18 of Turkish Commercial Code No. 6102: “A merchant is subject to bankruptcy for all kinds of debts; he or she is also obliged to choose a trade name in accordance with the law, to have the commercial business registered in the trade registry and to keep the commercial books required under the provisions of this Code.”
[21] AYHAN, Rıza; Ticari İşletme Hukuku, Genel Esaslar, 8th ed., 2015, Ankara, p. 291
[22] ÇOBAN, S. Özlem; Türk Hukukunda Marka ve Ticaret Unvanı Arasındaki İlişki Dolayısıyla Ortaya Çıkan Sorunlar ve Çözüm Önerileri, 2014, Ankara, p. 33
[23] AYHAN, Rıza; Ticari İşletme Hukuku, Genel Esaslar, 8th ed., 2015, Ankara, p. 290
Related legislation: Turkish Commercial Code No. 6102 (mevzuat.gov.tr)
The TTK contains no express definition of a trade name. Drawing on TTK 39/1, the article defines a trade name as the name used by merchants in relation to the transactions of their commercial enterprises.
A merchant must conduct the transactions of its commercial enterprise under its trade name and sign the instruments and documents relating to the enterprise under that name. The registered name must be written legibly at a visible place of the enterprise and shown in business letters and in the documents on which book entries are based; companies obliged to maintain a website must also publish it on the site.
In joint stock, limited liability and cooperative companies, the name may be chosen freely provided that the business activity is indicated; in general and limited partnerships, the name contains the first name and surname of at least one partner with unlimited liability together with a term indicating the company and its type. The trade name of a merchant who is a natural person contains the merchant's first name and surname written out without abbreviation.
Makaleye göre aynı unvanın daha önce tescil edilmiş bir unvandan ayırt edilmesi gerektiğinde, şubelerde merkezin unvanının şube olduğu belirtilerek kullanılmasında ve tasfiye hâlindeki şirketlerde ‘tasfiye hâlinde’ ibaresi için ek yapılması zorunludur.
Additions that would create a misleading impression among third parties as to the merchant's identity or the size, importance or financial position of its enterprise, or that are contrary to the truth or to public order, may not be used.
Makalenin yazıldığı tarihteki düzenlemeye göre TTK 46/3 uyarınca ‘Türk’, ‘Türkiye’, ‘Cumhuriyet’ ve ‘Millî’ kelimeleri ticaret unvanına ancak izinle konabilir. Makalede bu kelimelerin devletle bağlantı izlenimi yaratabileceği için izne tabi tutulduğu belirtilmektedir.
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