International Business Arbitration, Oil Gas Lawyer Heritage Law Firm In Ankara Turkey.

Turkey holds a prominent and active position in international trade due to its strategic location, industrial and production capacities. By developing trade relations with countries worldwide and leveraging its ports, straits, and road networks, Turkey plays a critical role in global trade. Beyond its involvement in international trade agreements, Turkey’s location has also made it a key player in transit trade between Asia and Europe, including the transportation of goods such as natural gas and oil through pipelines.

What Is The Advantage Of Arbitration In Turkey Regarding Commercial Activities?

The dynamic and fast-paced nature of commercial activities necessitates resolving disputes efficiently and with minimal impact on business operations. In this regard, Turkey has witnessed significant developments in both national and international arbitration, particularly since the early 2000s. Over the last 15 years, arbitration centers have been established, and the inclusion of arbitration clauses in commercial contracts has become increasingly common. These developments have encouraged lawyers in Turkey to specialise in arbitration, to become English-speaking lawyers and have led to numerous national and international publications on the subject.

The growth of arbitration in Turkey has also led to an increase in international commercial contracts referencing European arbitration centers. International commercial arbitration offers faster and more efficient dispute resolution compared to conventional courts, thereby minimizing disruptions to business activities. Naturally, the frequent use of arbitration in Turkey has also driven corresponding legal regulations.

Arbitrability of Disputes in Turkey

In Turkey, the concept of arbitrability defines which disputes can be resolved through arbitration. Under Turkish law, disputes involving private rights that parties can freely dispose of, such as commercial and contractual issues, are generally arbitrable.

However, certain matters, like criminal cases, family law, or disputes related to public policy, are excluded. The Turkish International Arbitration Law and Civil Procedural Code guide these principles. Firms like Ongur & Partners offer expert advice, ensuring compliance with arbitrability rules while effectively representing clients in arbitration proceedings.

Are the Arbitral Awards Enforceable in Turkey?

The Turkish Code of Civil Procedure has been amended to include provisions on arbitration, and the International Arbitration Law (Law No. 4686), enacted on June 21, 2001, has clarified the enforcement and applicability of arbitral awards rendered abroad or involving a foreign element within Turkey.

As the law indicates, to enforce an arbitral award in Turkey, the expiration of the time limit for annulment proceedings or the rejection of an annulment application must precede a request for a certificate of enforceability from the competent and authorized court. For commercial disputes, the competent court is the Commercial Court of First Instance, while the court of jurisdiction is the one where the debtor is domiciled.Clearly, the enforcement of international arbitral awards in Turkey is not only possible but also a frequently employed dispute resolution method.

Arbitration Agreements

An arbitration agreement is a cornerstone of arbitration, reflecting parties’ consent to resolve disputes outside courts. In Turkey, these agreements must be in writing and clearly state the intent to arbitrate. They can be standalone contracts or clauses within broader agreements.

The Turkish International Arbitration Law ensures their enforceability, provided they comply with public policy and jurisdictional requirements. Arbitration agreements must also specify governing rules, venues, or institutions like ISTAC.

Appointment of Arbitrators Pursuant to Turkish International Arbitration Law

The Turkish International Arbitration Law governs arbitrator appointments, ensuring impartiality and expertise. Parties can agree on the number and method of selecting arbitrators. If no agreement exists, a sole arbitrator is appointed, or each party selects one arbitrator, with a presiding arbitrator chosen jointly.

In case of disputes over appointments, Turkish courts intervene to ensure fairness. Arbitrators must be impartial and meet qualifications agreed upon by the parties. Ongur & Partners provide guidance in navigating this process, ensuring efficient arbitration proceedings under Turkish law.

Correction and Clarification of Arbitration Awards

Under Turkish International Arbitration Law, parties can request correction or clarification of an arbitration award to address errors or ambiguities. These requests must be made within 30 days of receiving the award unless otherwise agreed.

Corrections cover typographical or calculation errors, while clarifications address unclear provisions. Arbitrators can also interpret awards upon request. This process ensures accuracy and finality in arbitration outcomes. Ongur & Partners helps parties effectively navigate corrections, safeguarding their interests in arbitration proceedings.

Arbitration Practise In Turkey

Turkey has emerged as a key hub for arbitration, offering a strategic location and modern legal framework. The country supports international arbitration through laws aligned with global standards, such as the UNCITRAL Model Law. Major institutions like the Istanbul Arbitration Centre (ISTAC) handle commercial disputes efficiently, fostering a favorable environment for businesses.

Turkish law firms, including specialists like Ongur & Partners, provide expert services in arbitration. Their proficiency in international rules like ICC and ICSID ensures effective representation. Turkey’s arbitration practice continues to attract global investors seeking reliable dispute resolution.

Can I Choose a Language Other Than Turkish in Arbitration Proceedings?

In cases involving international disputes, arbitration proceedings can be conducted at institutions based in Turkey, such as the Istanbul Arbitration Centre (ISTAC) or the TOBB Arbitration Centre, or at internationally recognized centers like the ICC or CAM. English can also be chosen as the language of arbitration in such cases.

Enforcement of Arbitral Awards in Turkey

Turkey is a signatory to the New York Convention, facilitating the enforcement of foreign arbitral awards. The enforcement process is governed by the Turkish International Arbitration Law and the Civil Procedural Code. Awards must meet conditions like jurisdiction, proper notification, and public policy compliance to be recognized.

Turkish courts generally uphold arbitration-friendly principles, ensuring swift resolution for international and domestic disputes. Renowned law firms like Ongur & Partners offer expert guidance, helping clients navigate enforcement proceedings effectively. Turkey’s legal framework reinforces its status as a reliable venue for arbitration.

Who Should I Work with in the Arbitration Process?

Working with English  speaking lawyers in Turkey, particularly those registered with Turkish bar associations, ensures effective dispute resolution and facilitates client-lawyer communication. This approach is especially advantageous when dealing with disputes subject to Turkish law or representing clients both domestically and internationally.

Are Arbitral Awards Recognised Internationally?

Since Turkey is a party to the 1958 New York Convention, arbitral awards rendered in Turkey may be recognised and enforced in other contracting states. This ensures the international validity of Turkish arbitral awards. However, in some special cases, foreign courts may refuse to recognise an arbitral award rendered in Turkey on grounds such as contravention of public policy or lack of jurisdiction. In order to avoid such situations, it is advisable to work with a lawyer in Turkey.

Recognition and Enforcement of Foreign Arbitral Awards in Turkey

Turkey adheres to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958, which provides the legal framework for the recognition and enforcement of foreign arbitral awards. This means that arbitral awards issued in one signatory country can generally be recognized and enforced in another signatory country, including Turkey, provided that certain conditions are met.

In Turkey, the enforcement process begins with filing a recognition and enforcement lawsuit before a Turkish court. The court then assesses whether the award meets the conditions stipulated in the New York Convention and Turkey’s International Arbitration Law. Key considerations include whether the award respects public policy and whether the parties had a fair opportunity to present their case.

Notably, Turkish courts do not review the merits of the arbitral award but focus solely on procedural aspects. Once recognized, the foreign arbitral award holds the same power as a local court judgment, enabling the successful party to initiate execution proceedings.

In summary, Turkey’s commitment to the New York Convention facilitates the smooth recognition and enforcement of foreign arbitral awards, reflecting its dedication to fostering an arbitration-friendly legal environment.

How Long Does the Arbitration Process Take in Turkey?

The duration of arbitration in Turkey may vary depending on the nature and complexity of the dispute and the speed of the parties in the process. In general, however, arbitration proceedings may take less time than court proceedings. Some institutional arbitration centres have developed various procedures to offer quick resolution methods. For example, ISTAC’s ‘Expedited Arbitration’ procedure can lead to an award in as little as 6 months for smaller and simpler disputes. Complex and large-scale disputes may take longer, but the arbitration process is still generally faster than court proceedings. Moreover, it is possible to accelerate certain procedures in arbitration by agreement of the parties. As a result, the duration of arbitration can often range from 6 months to 1 year, although certain circumstances may affect this duration.

Setting Aside of Arbitration Awards in Turkey

Under Turkish International Arbitration Law, arbitration awards can be set aside under specific conditions. Grounds include lack of jurisdiction, procedural irregularities, or violation of public policy. Parties must challenge the award within 30 days of receiving it.

Turkish courts carefully review these grounds to ensure fairness and compliance with legal standards. Ongur & Partners offer expert guidance in navigating the complexities of setting aside arbitration awards, safeguarding clients’ rights and interests throughout the legal process.

International Arbitration in Turkey

Ongur & Partners is a prominent Turkish law firm specializing in international arbitration. With Turkey’s growing role as a hub for cross-border disputes, the firm provides expert legal representation in arbitration proceedings under various rules, including ICC, UNCITRAL, and ICSID.

The firm’s experienced team, fluent in English, ensures effective advocacy and strategic guidance in complex cases. Ongur & Partners supports global clients in resolving commercial and investment disputes efficiently, leveraging Turkey’s favorable arbitration framework. Trusted for professionalism and precision, they are a leading choice for international arbitration in Turkey.

Arbitral Institutions in Turkey

Turkey hosts several reputable arbitral institutions that support efficient dispute resolution. The Istanbul Arbitration Centre (ISTAC) is a leading institution handling domestic and international cases. Other significant organizations include the Turkish Commercial Arbitration Association (TAA) and the Istanbul Chamber of Commerce Arbitration Centre.

These institutions operate under the Turkish International Arbitration Law, ensuring adherence to global arbitration standards. Ongur & Partners provides expert support, guiding clients through proceedings in these institutions while ensuring compliance with legal requirements and protecting their interests.

International vs. Domestic Arbitration in Turkey

Arbitration in Turkey is governed by distinct laws for international and domestic cases. International arbitration follows the Turkish International Arbitration Law, aligned with the UNCITRAL Model Law, focusing on cross-border disputes. Domestic arbitration is regulated by the Turkish Civil Procedural Code, handling local disputes.

Key differences include applicable rules, language preferences, and procedural requirements. Turkey offers arbitration-friendly policies for both, supported by institutions like ISTAC. Leading firms, such as Ongur & Partners, provide expertise in navigating these processes, ensuring efficient dispute resolution for global and local clients alike.

What is an Arbitration Agreement and is it Mandatory?

An arbitration agreement is a contract in which the parties agree to resolve their disputes through arbitration. This agreement may be included in the main contract as an arbitration clause or may be organised as a separate agreement. An arbitration agreement is not mandatory; it is subject to the consent of the parties.

Future Prospects of International Arbitration in Turkey

Turkey is positioning itself as a rising hub for international arbitration due to its strategic location, modern arbitration laws, and growing expertise in commercial disputes. The Istanbul Arbitration Centre (ISTAC) is increasingly recognized for its efficient and effective resolution of international disputes.

Recent legal reforms and the adoption of internationally recognized arbitration standards, such as the UNCITRAL Model Law, further enhance Turkey’s arbitration framework. Additionally, the Turkish judiciary has shown a supportive stance towards arbitration by enforcing arbitral awards and minimizing judicial intervention in arbitral proceedings.

Turkey’s integration into global trade and investment flows also drives the demand for reliable arbitration services. As businesses seek more certainty and impartiality in dispute resolution, Turkey’s robust arbitration infrastructure is likely to attract more international cases.

In conclusion, with its advantageous geographic position and progressive legal environment, Turkey is poised to play a significant role in the future of international arbitration.

Is the Arbitration Agreement Affected If Other Parts of the Contract Are Invalid?

An arbitration agreement is generally considered valid independently of other provisions of the contract. This principle is called the ‘separability principle’. According to this principle, if other parts of the contract are held invalid, the arbitration agreement may still be valid. However, this is the case unless the parties expressly invalidate the arbitration clause. Therefore, the arbitration agreement may continue to function independently of the other parts of the contract. Working with an arbitration lawyer in Turkey from the beginning of the contract will be an advantage for you in every way.

Civil Law Cases in Turkey

Legal cases in Turkey are proceedings conducted to resolve disputes arising in the field of private law. The procedure for legal cases is governed by the Code of Civil Procedure No. 6100. Below, several types of disputes related to legal cases are examined:

Commercial Cases

The substantive law applicable to disputes under commercial law is the Turkish Commercial Code No. 6102. Article 4 of this Code outlines which disputes are considered commercial cases. Commercial cases are divided into three categories:

Absolute Commercial Cases: These are cases explicitly regulated under Article 4 of the Turkish Commercial Code or other special laws that expressly designate them as commercial cases.

Relative Commercial Cases: These cases arise from matters related to the commercial enterprises of both parties. For a case to be classified as a relative commercial case, both parties must be merchants.

Cases Accepted as Commercial in Nature: These are cases that, although they concern only one party’s commercial enterprise, are classified as commercial due to their nature, such as disputes concerning remittance, deposit, and intellectual property rights.

In summary, disputes arising in the context of commercial activities are resolved as commercial cases under the Turkish Commercial Code. The classification of a dispute as a commercial case entails certain procedural rules.

Primarily, pursuant to the law, Commercial Courts of First Instance, which are specialized courts under the Turkish judicial system, are authorized to handle commercial cases. The proceedings in these courts follow the written procedure as prescribed by Turkish law, meaning that parties have the right to file two petitions, and the process includes oral hearings.

Additionally, according to Article 5 of the Turkish Commercial Code, mediation is a prerequisite for filing a lawsuit in commercial cases. The parties to a dispute must undertake mediation proceedings before initiating a commercial case. If the parties cannot reach an agreement during the mediation process, the dispute is referred to the Commercial Courts of First Instance.

In commercial disputes involving foreign individuals or companies in Turkey, the large monetary stakes and the foreign nature of the parties often necessitate reliance on evidence and documentation in English. Therefore, it is highly recommended that such disputes be handled by English-speaking lawyers experienced in commercial law. Similarly, conducting the mediation process with the assistance of a lawyer is crucial to avoid any potential loss of rights.

Labor Law Cases

Labor Law establishes the foundation of the employment relationship between employees and employers in the working environment. Disputes arising between employees and employers are resolved under the scope of labor law cases. The substantive law applicable to labor cases in Turkey is the Labor Code No. 4857. Examples of cases that may be filed under Turkish labor law include:

Service Determination Cases

Cases for Employee Salary Claims

Cases for Severance Pay Claims

Cases for Notice Pay Claims

Claims for Overtime, Weekly Rest, and National Holiday Pay

Claims for Paid Annual Leave

Reinstatement Cases

Compensation Cases Due to Workplace Accidents

Determination Cases Related to Workplace Accidents

Cases Involving Subcontractor-Principal Employer Relationships

Procedural rules for labor law cases are regulated under the Labor Courts Law No. 7036. Specialized Labor Courts are authorized to handle labor disputes. However, before filing a labor lawsuit, the parties must first apply for mediation pursuant to Article 5 of Law No. 7036. If no agreement is reached during mediation, the dispute is referred to the Labor Courts.

For resolving labor law disputes involving foreign employers or employees, obtaining legal services from English-speaking lawyers is of great importance. Labor law is extensively regulated under Turkish law, and resolving disputes with the assistance of experts in the field will benefit the parties.

Cases Related to Lease Disputes

Lease agreements are regulated under the Turkish Code of Obligations No. 6098, particularly in its fourth chapter. According to the provisions of this law, lease agreements are categorized into residential and commercial lease agreements. In practice, disputes frequently arise from residential and commercial lease agreements, and cases related to lease disputes can be summarized as follows:

Under the Code of Civil Procedure, Civil Courts of Peace are authorized to hear lease disputes. All types of termination and eviction cases, as well as all types of claims and compensation cases, are handled by these courts. Even if a counterclaim is filed in connection with a lease-related case, it will also be handled by the Civil Court of Peace as per the law. However, in certain circumstances under special laws, general rules do not apply. For example, if the evacuation of leased property is sought through enforcement proceedings, the Enforcement Court will have jurisdiction over objections and eviction matters.

As of September 1, 2023, mediation has become mandatory before filing a lawsuit in lease disputes. Therefore, parties must engage in a mediation process before initiating a lease dispute case. However, for certain disputes arising from lease agreements, applying for mediation before filing a lawsuit is not mandatory, as explicitly stated in the law.

In lease disputes involving foreign individuals or legal entities in Turkey, obtaining legal assistance from English speaking lawyers is highly recommended. Since lease law is extensively regulated in Turkish law with procedural and substantive rules, resolving disputes with the assistance of experts in the field will benefit the parties.

Recognition and Enforcement Cases

Cases filed to obtain a court decision allowing the recognition and enforcement of foreign court decisions or arbitral awards in Turkey are known as recognition and enforcement cases. The rules governing recognition and enforcement are regulated under the International Private and Civil Procedure Law No. 5718.

To speak of recognition and enforcement, a foreign court must have issued a decision on a dispute, or an arbitral award must exist. For the foreign decision to have legal effect in Turkey, it must be recognized and enforced by a local court. In such cases, the local court decides whether to recognize and enforce the foreign decision, either wholly or partially, as required. Recognition and enforcement cases are significant in Turkish law as they allow foreign or local parties to enforce foreign court or arbitral decisions within Turkey.

The duration of recognition and enforcement cases depends on factors such as the parties’ communication, the availability of notification addresses, and whether the parties are represented by a lawyer. Given that foreign court decisions are at the center of these cases, working with English-speaking lawyers is crucial for ensuring a swift recognition and enforcement process and subsequent implementation of the decision.

At Ongur & Partners International Law Firm, our English speaking lawyers continue to provide legal services to both foreign and local clients in private law cases, including recognition and enforcement cases.