In the important phase of selecting arbitrators, which enables
arbitration procedure to commence healthily and continue, The
Turkish International Arbitration Law of 2001 ("TIAL")
confers freedom to parties as to qualifications, nationality,
authority and the number of arbitrators, as long as it is an odd
number. TIAL also allows parties to designate a specific person in
the arbitration agreement. However, if that person does not accept
their nomination, resigns or becomes unavailable for any legal or
factual reason, and where parties did not consent on the
appointment of a substitute arbitrator, TIAL states that the
arbitration procedure is to be terminated and proceedings before a
competent state court are to be initiated. In this vein, the
Supreme Court further expressed that in such circumstances the
validity of the arbitration agreement, in other words, parties'
will to arbitrate, is alive only if the specifically selected
person acts as the arbitrator.
It must be added that if the appointment mechanism devised by
the parties fails, upon request of a party, the commercial court of
first instance is authorized to appoint an arbitrator or the
tribunal, its decision being final.
Before accepting an appointment, TIAL articulates that a
prospective arbitrator must disclose any circumstances which might
raise justifiable doubts regarding the arbitrator's
impartiality or independence. Then, an arbitrator must also
disclose any circumstances which arise after commencement of
proceedings and which parties are unaware of.
Arbitrators may be challenged on the following grounds: if they
do not meet with the qualifications that the parties have decided;
if reasonable doubts emerge as to their independence and
impartiality; or other grounds of challenge consented to by the
parties take place.
TIAL allows parties to freely designate the procedure for
challenging the arbitrators. If such agreement is absent, the
challenging party must send a written statement including the
reasons for the challenge to the other party within 30 days of the
constitution of the tribunal or appointment of the arbitrator, or
within 30 days of noticing circumstances that incite the challenge.
Also, the party who seeks to challenge one or more arbitrators must
initially notify the tribunal. If the tribunal rejects the
challenge, the dissatisfied party may start proceedings before the
competent court within 30 days of receipt of the decision, in order
to have the decision annulled and challenge arbitrators. However,
if a sole arbitrator, the tribunal or arbitrators who represent
voting majority, is to be challenged, the commercial court of first
instance is the only competent court. The latter's judgment on
the matter shall be final and binding.
Under TIAL, unless otherwise agreed by the parties, an
arbitrator is liable for the loss caused by his unjustifiable
failure to perform duties assigned to him. Also, the succeeding
subparagraph states that if existent legal conditions forestall an
arbitrator to fulfil his duties, then his mandate can be terminated
upon voluntary withdrawal of the arbitrator or agreement of the
parties. While Turkish law reflects the prevailing stance by
qualifying the relationship between the arbitrators and the parties
as contractual, it requires an arbitrator to intentionally or
negligently inflict damage on parties in order for him to be
This article first appeared in the second Edition of Global
Legal Insights–International Arbitration; published by
Global Legal Group Ltd, London.
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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