Turkey: The Procurement Principles In Turkish Defense Industry

Last Updated: 17 September 2014
Article by Safak Herdem

In Turkey, many of the governmental authorities shall apply to procurement of goods, services or works under Public Procurement Law #4734 (PPL). In the same manner, the contracts in public purchase of goods, services and works refer to this law's "contract principles" indicated in the Public Procurement Contract Law (#4735) (PPCL). But it had better to lay emphasis on an exception for defense issues under law#4734.

Exception in PPL#4734 stipulates that the procurement for defense, security or intelligence related goods, services and works decided by the relevant ministry and require to be treated confidential, and procurements requiring special security measures during the performance of the contract pursuant to related legislation or those concerning the cases in which the basic interests of the state's security needs to be protected shall not be governed by this Law except prohibition and criminal provisions.

Within the framework PPL#4734 as mentioned above, some principles and procedures for goods, services and works related to a decree was promulgated by Ministry of Defense (MoD) in 2009 and having amendments and annexes in 2011 and 2012. In this context, this decree (As part of the decision about implementation of annexed principles and procedures related to Public Procurement Law No. 4734 of Article 3 of paragraph (b)) and the Public Procurement Contract Law (#4735) serve as basis of contracts of MoD.

As the legislation refers so there are five contract types under PPCL#4735 as follows;

  • In procurement of works; turnkey lump-sum contracts shall be made over the total tender price for the entire work proposed by the tenderer on the basis of application projects and site lists thereof.
  • In procurement of goods or services; lump-sum contracts shall be made over the total tender price proposed by the tenderer for the entire work, the detailed specifications and quantities of which are pre-determined by the contracting entity.
  • Unit price contracts shall be made over the total price calculated by multiplying the quantity for each work of item specified in the schedule prepared by the contracting entity, with unit prices proposed by the tenderer for each corresponding work of item, on the basis of the preliminary or final projects and site lists thereof along with unit price definitions in procurement of works whereas on the basis of detailed specifications of the work involved in procurement of goods or services.
  • In procurement of works, mixed contracts can be formed together with turnkey lump-sum contracts for some parts of work items and unit price contracts for the other parts.
  • Separate contracts can be signed between administration and contractor as based on a framework agreement.

It shall be mandatory to cover the issues listed below in the contracts to be made under this law: (The governmental institutions are authorized for indicating the compulsory matters in mixed contracts and separate contracts)

  • Title, specification, category and quantity of work; description of work in procurement of services. 
  • Name and address of the contracting entity. Name or business title and address for notification of the contractor. 
  • Information on sub-contractors, if any, and their obligations.
  • Price, category and duration of contract.  
  • Terms and place of payment; amount and place of advance payment, if any.
  • Method of payment of price difference, if any, for business under contract.
  • Statement of cost items that are to be included in the contract price from among transportation, insurance, taxes, duties and charges payable.
  • Statement of the parties that would pay for cost items from among taxes, duties, and charges payable and other expenses under the contract.
  • Terms and conditions concerning such auxiliary services as installation, commissioning, training, repair-maintenance, and spare parts.
  • Amount of performance security and conditions pertaining to returning of it.
  • Guarantee periods, where any is required, and any conditions pertaining to such guarantee.
  • The place of performance, and procedure and conditions of delivery and receiving.
  • Penalties applicable in case of delays.
  • (Amendment: 4964/Article 43) Force majeure and conditions for granting time extensions, mutual obligations in work increases and decreases which may be made under the scope of the contract.
  • Conditions pertaining to control, inspection and acceptance procedures.   
  • In procurement of works; conditions pertaining to insurance coverage of works and works site along with control of works and construction liability.
  • Conditions pertaining to amendments of contract.
  • Conditions pertaining to termination of contract.
  • Contractor's liability pertaining to personnel in which the contractor would   employ under the contract.
  • Statements that all documents included in the tender documents are attachment to contract.
  • Resolution of disputes.

According to Decree No. 2009/14973 dated 20.04.2009, the following principles are applied in the contracts for procurement of goods, services and works held by the Ministry Defense

Contract Types for Tender/Procurements in MoD

All tenders / procurements are initiated with negotiations on prices, or if they are specified in the tender documents, is carried out without the price negotiations. As a result of the assessment, a total lump sum contracts are applied over the total tender price for the entire work which of the detailed specs and amounts determined by the administration.

Similarly, based on the detailed characteristics of the work; Unit price contracts are issued over the total tender price calculated by multiplying the amount of each item on the administrative schedule with the unit prices determined for each of these items.

The contracting officer will decide whether to perform the procurements to be made under these principles. This point is indicated in the certificate. Unless otherwise stated, the notarization and the registration are not mandatory in the certificate of approval and administrative specifications of contracts to be made as a result of the tender and procurement.

In procurement of works, mixed contracts can be formed together with turnkey lump-sum contracts for some parts of work items and unit price contracts for the other parts.

In procurement of goods and/or services, total lump sum contracts or unit price contracts of which details specified in the tender documents are applied not to exceed the funds allocated by administration due to the nature of subject matter of supply. This principle is valid where it is not possible to pre-determine the place and time of supplying quantity.

In research and development projects, different types of contracts which details specified in the tender documents can be arranged not exceeding the budget allocated by administration due to the nature of subject matter of supply.

The Mandatory Considerations Included in the Contracts

In accordance with the mandatory matters to cover the issues listed above, additional considerations can be added or removed from the contracts. Likewise, the contracts may be arranged in another language in addition to Turkish. In this case, the Turkish version prevails in the interpretation of the contract by law. However, any foreign language is acceptable in the annexes.

The Increase and Decrease of Works to be Implemented in the Frame of Contracts

In the contracts performed within these principles, the goods and services can be procured more or less up to the ratios 20% of their contract prices provided that specified in the administrative specifications. Except the price difference given in the contract, the implementation of this ratio can be performed with the approval of contracting officer without changing the contract unit price and issuing an additional contract. Besides, in procurement of works, excessive procurement up to the ratios 20% of their contract prices can be performed under the provisions of the contract and tender documents (excluding the time) without arranging any additional contract.

Regulations on Domestic Bidders

The provisions providing up to 15% price advantage points can be placed in the tender document providing that;

  • In favour of all domestic bidders in the procurements of services and works,
  • In favour of the bidders who offer goods determined by Ministry of Industry and Trade Ministry as domestic goods he procurement of goods taking the opinion of the Ministry of Industry and Trade Ministry determined by the domestic goods

However, the local bidders participating through joint ventures with foreign bidders in the tender cannot benefit from these provisions.

According to the NATO security investment program, the price advantage to local bidders in procurements of works held under Law No. 6095(The Law of Construction and Installation Works Held in Turkey pursuant to NATO Infrastructure Joint Program) cannot be applied in the context of NATO principles and procedures.

Force Majeure

The circumstances considered as force majeure are as follows:

  • Natural Disasters
  • Legal Strike
  • Epidemic Cases
  • Announcement of partial or general mobilization
  • Other similar circumstances that may be determined by the authority when necessary

For the contracting entity to be able to accept any of the circumstances stated above as force majeure, including cases of time extension and contract termination; it shall be absolutely necessary that the concerned case does not raised out of the contractor's failure, that constitutes an obstacle in fulfilling the contractual obligations. 

According to the properties of the goods / services and works, different arrangements can be done for the duration of notice and / or certification provided that specified in the tender documents.

Termination of the contract due to force majeure or administrative issues such as impunity for extension of time can be arranged by the administration providing those are specified.

The principles of;

  • Duties and responsibilities of administration and tenderer for arranging the contract,
  • The contract binding of procurement / purchase,
  • Invitation to contract,
  • Investigation of complaints by the administration,
  • Arrangement of additional contracts,
  • The procurements which must be conducted in secrecy,
  • Audit-inspection, acceptance procedures and works

are arranged by ministry in the tender / procurement. The principles and procedures of decisions related to defense, security and intelligence or the decisions granted by the Ministry which should be carried out in secrecy is determined by the MoD. As a result, the principles and procedures set forth herein were arranged as a guide by considering the relevant laws, decrees and the other documents specifically related to Turkish MoD.

This article contains data from SSM Website and the article "The Undersecretariat for Defense Industries (SSM) Procurement Operations And Legal Framework-2010".

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Safak Herdem
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions