Turkey: ISTANBUL ARBITRATION CENTER: A Review On The Structure Of Istanbul Arbitration Center In Relation To The Concerns On Its Success And Impartiality

I.  Introduction

Istanbul Arbitration Center Law no. 65701 ("the Law") was passed by the Turkish Parliament on November 20, 2014, and entered into force on January 1, 2015. Istanbul Arbitration Center ("IAC" or "the Center") has been planned to be established under the Istanbul International Finance Center Project2 as a part of Turkey's 9th National Development Plan3. In this context, "[e]stablishment of an independent, autonomous institutional arbitration center in Istanbul ... is viewed as essential for enabling the city to compete at the international level."4 The loud concerns on impartiality and success of the Center, however, strikes a sour note.

Throughout this article the focus will be on the organization of IAC in accordance with the Law, and its probable effects on and results of impartiality and success of the Center.

II.  Organization of IAC

Under the Article 5 of the Law, the Center will be consisted of (i) General Assembly, (ii) Board of Directors, (iii), Auditor, (iv) Advisory Board, (v) Court of International Arbitration, (vi) Court of National Arbitration, and (vii) General Secretary. General Assembly, Board of Directors, and the Advisory Board will be reviewed in this Article.

The latest information on IAC and, thereby, the constitution of the aforesaid bodies, is currently being reported by the Union of Chambers and Commodity Exchange of Turkey ("TOBB") since an official website or reporter for IAC has not been established yet. Therefore, the following information on the organization is based on the very limited information published on TOBB's website, and information personally gained from the TOBB officials.

General Assembly

It is known that the General Assembly has been recently constituted in accordance with the Article 6 of the Law. The full list for the name of the members, however, has not been officially published. Under the Law, the General Assembly shall be consisted of 25 members from various institutions. Those institutions include TOBB (6), the Higher Education Council (3), Ministry of Justice (1), Union of Turkish Bar Association (4), Union of Banks of Turkey (1), Participation Banks Association of Turkey (1), Capital Markets Board (1), Banking Regulation and Supervision Agency (1), among others.

The formation of the General Assembly is criticized by many scholars and lawyers mainly because the members, under the Law, -except for the members from Higher Education Council, are not required to have experience on arbitration.5 It is correctly suggested that such lack of experience of members will negatively affect the success of the Center.

Secondly, many of the institutions set forth in the Article 6 either are bodies of the State (such as Higher Education Council and Ministry of Justice) or have strong ties with it (such as Capital Markets Board and Banking Regulation and Supervision Agency). It is stated that those direct or indirect relations with the State pose a threat on the impartiality, and therefore, the reliability of the Center. It may be argued that such impartiality concerns are irrelevant because the Center itself does not take any part in the decision making process and such process will be under the sole power of the Tribunal. However, it is a widely accepted fact that the impartiality of the arbitration centers are of crucial importance for the success and reason for preference.6

Furthermore, General Assembly's duties include the selection of the members of the Board of Directors and the Advisory Board. Board of Directors, as will be explained below, has the power to set the Arbitration Rules and Advisory Board will be consulted by Board of Directors during this process. It is clearly seen that General Assembly's duty of selection of those members will have a direct effect on the Arbitration Rules. Therefore, such selection should be executed by the experts on the field of arbitration for the sake of success of the Center.

Board of Directors

The General Assembly was convened at TOBB's service building in April to select the Board of Directors ("the Board").7 Prof. Dr. Ziya Akinci has been appointed as the President of the Board. Mustafa Cikrikcioglu from Turkish Exporters Assembly, Hakan Oztatar from Ministry of Justice, Mujdat Kececi from TOBB and Attorney Mehmet Rifat Bacanli have been appointed as the members of the Board.

In accordance with the Law, the Board shall within six months after its constitution set the Arbitration Rules of the Center. The Board has been constituted in late April (exact date has not been published) and the said time period has almost been passed. It is announced by IAC officials during the 3rd Annual Global Arbitration Review Live Istanbul Conference that the Rules has now in circulation for comment. Such circulation is believed to be amongst the Advisory Board members. The Arbitration Rules has been awaited impatiently by the lawyers and the Rules are expected to be released soon.

Advisory Board

The 15 members of the Advisory Board have been appointed in the same General Assembly meeting stated above in late April. Although the duty to set the Arbitration Rules is given to the Board of Directors, Advisory Board is believed to take a crucial part in the process.

The names of the Advisory Board members have not been officially announced. It is said by the officials of the TOBB that the members include well-known scholars and practitioners from the field of international arbitration.


Due to lack of official announcements and absence of an official reporter, the latest news on the Center and its structure may only be obtained through personal relations and TOBB's website, which includes quite limited information.

With the limited information obtained through those channels, it can be said that the success of the Center is highly dependent on a handful members of the Advisory Board and Board of Directors. Further, it goes without saying that the Center needs an official and well-working reporter and website to release reliable information to the public.

Only time will show if the Center reaches the objective to become a reliable alternative to the other international arbitration institutions. 


1 Istanbul Arbitration Center Law no. 6570, http://www.resmigazete.gov.tr/eskiler/2014/11/20141129-1.htm, D.o.A.: October 12, 2015

2 Istanbul Finance Center Project, http://www.istanbulfinansmerkezigirisimi.com/en, D.o.A.: October 12, 2015

3 T.R. Ministry of Finance, 9th Development Plan, http://www.maliye.gov.tr/Lists/TabMenuIcerik/Attachments/106/9developmentplan.pdf, D.o.A.: October 12, 2015

4 Ruth Levush, Arbitration in Turkey and Istanbul as a New International Arbitration Center, U.S. Library of Congress, Global Law, April 7, 2014

5 Tahkim merkezi mi, Civali zar mi, USIAD, Bildiren, 13, July 2013

6 Corporate Choices in International Arbitration, PricewaterhouseCoopers, 2013 International Arbitration Survery, http://www.pwc.com/gx/en/arbitration-dispute-resolution/assets/pwc-international-arbitration-study.pdf, D.o.A.: October 12, 2015

7 TOBB Report on the General Assembly Meeting, http://www.tobb.org.tr/Sayfalar/Detay.php?rid=6429&lst=Haberler, D.o.A.: October 12, 2015

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.

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