What is a Legal Entity?


In the business world, various types of enterprises and companies are referred to by different names based on their legal statuses. Each of these designations defines a range of factors such as the legal structure, responsibilities, tax status, and rights held by that enterprise. Legal personality is one such designation and constitutes an integral part of the business world. In this article, we will explore the concept of "Hiosis" and delve into what it means to be a legal entity in detail.

Hiosis and Legal Personality:

According to the Turkish Commercial Code, legal personality refers to a form of organization recognized as a separate entity with its own rights and obligations. Legal personality signifies that a company or business is recognized as a distinct entity under the law, separate from the rights and obligations of natural persons. At this point, the concept of Hiosis comes into play.

Hiosis, meaning legal personality, is a term particularly associated with the legal structure of joint-stock companies, especially in Turkey. Joint-stock companies are significant players in the capital markets and are often favored by large-scale enterprises. These companies enjoy advantages such as the ability to increase capital and offer shares to the public. The association of the term "Hiosis" with the concept of legal personality underscores the legal recognition of joint-stock companies as separate entities.

Legal personality allows a business to be recognized as an independent entity. This implies limited liability concerning the company's debts, meaning that the liabilities of the business are limited to its assets and are not associated with the personal assets of the business owners. This provides significant assurance for business owners and helps minimize risks.

Furthermore, legal personality ensures the continuity of the business. Even if there are changes in ownership, the business continues to exist as a legal entity. This facilitates long-term planning, investments, and growth for the business.


The term Hiosis is used in the Turkish Commercial Code to denote legal personality. It is particularly important in defining the legal structures of joint-stock companies. Legal personality allows businesses to be recognized as independent entities, offers limited liability, and ensures business continuity. Therefore, understanding the concept of Hiosis is crucial for those operating in the business world, serving as a fundamental step in comprehending the legal structures of businesses.


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