Turkey: Is Good, Fast, And Cheap Arbitration A Dream?

Last Updated: 23 November 2018
Article by Pelin Baysal and Bi̇lge Kağan Çevi̇k

LNB News 24/10/2018 7

The business community's original idea of arbitration was to solve commercial disputes smoother and faster than the conventional courts could. Back in those days, arbitration was, by definition, fast.

However, this perception has changed. In the 2015 International Arbitration Survey, cost and lack of speed were considered as the worst characteristics of international arbitration.

As a reaction to this growing appetite to run proceedings in a more efficient manner, arbitration institutions came up with specific rules intending to shorten arbitral proceedings and therefore lower costs. The challenge here was to create rules reaching the sweet spot of factors which seem hard do combine: fast track arbitration proceedings had to be fast, cheap and good quality all at the same time.

But doesn't a high-quality proceeding simply have its costs and time? And can a fast and cheap proceeding still be considered good quality?

As usual, the answer is not straightforward. Before giving answers to these questions, to follow are some of the general characteristics of fast track arbitration and the particularities of fast track mechanisms under the ICC, the SCC, the SIAC and the ISTAC arbitration rules.

I The Scope of Application: Automatic or Elective?

The scope of application of the fast tract arbitration rules provided by different institutions can be classified into two major groups: automatic and elective.

A very well-known example of automatic application is the ICC's Expedited Procedure. Accordingly, the expedited procedure will apply automatically if the amount in dispute does not exceed $2 million, and if the arbitration clause was concluded after 1 March 2017.

This automatic application can be deactivated in two scenarios: One, when the parties have agreed on not applying the Expedited Procedure Provisions, so called 'opt-out'. Second, when the Court decides that according to the concrete circumstances, an expedited procedure is not appropriate. This could be, for example, when the dispute appears to be too complex to be resolved under the fast track framework.

Additionally, parties are also free to agree on applying the Expedited Procedure Provisions even if the amount of dispute is higher than $2 million and the arbitration agreement is concluded before 1 March 2017, so called 'opt-in'.

The ISTAC fast track arbitration rules are very similar to the ICC's and also adopt the automatic application mechanism: unless the parties agreed otherwise, the dispute is automatically arbitrated under the fast track rules when the amount in dispute is less than $79,713. Equal to the ICC, the parties are free to opt-in and opt-out and the ISTAC may decide not to apply the fast track rules when the facts and circumstances of the case suggest doing so.

Other institutions like SIAC and SCC opted for an elective application for fast track arbitration.

In the SIAC arbitration, a party may apply for an expedited arbitral proceeding if one of the three criteria is met: (1) the amount in dispute does not exceed $5.6 million, (2) the parties have agreed to apply the expedited procedure and (3) there is a case of exceptional urgency. After the application for fast track

arbitration, the SIAC determines whether the dispute is suitable for fast-track arbitration On the other hand, in the SCC, fast track arbitration only applies if both parties consent to its application,

regardless of the value of the dispute or any other circumstance.

II. In what sense do fast track rules generally differ from "ordinary" arbitration rules?

1 Dispute generally resolved by a sole arbitrator

Generally, fast track rules provide or aim for the dispute to be decided by a sole arbitrator as opposed to three arbitrators. The goal is to speed up the proceeding and lower cost at the same time. The constitution of a tribunal may take months, and the chance of a successful challenge of the arbitrators is multiplied by three. Plus, it takes time for three professionals with busy schedules to coordinate.

Therefore, a high majority of fast track arbitration rules have authority to appoint a sole arbitrator notwithstanding any contrary provision in the parties' arbitration agreement. However, certain institutions such as the ICC and the SIAC leave themselves room to refer the dispute to the three-member tribunal under some exceptional circumstances. The ISTAC, however, pays further attention to parties' respective agreements and only has the case decided by a sole arbitrator in absence of a contrary agreement by the parties.

2 Limited Submissions and Possibility to Skip the Hearing

Fast track rules usually contain provisions which allow the tribunal to limit the extent (number, length and scope) of submissions and the extent or kind of evidence.

In international arbitral proceedings, it is not uncommon for parties to exchange several rounds of submissions without the tribunal pointing out those topics which are crucial to the decision. This leads the parties to submit extensive and repetitive submissions. Therefore, restrictions are accepted for the sake of speed and cost.

As an example of many others, under the ICC Rules there is no 'Terms of Reference' and the arbitrator may not allow the requests for document production, whereas under the SCC Rules a hearing will only be hold if requested by a party and considered necessary by the arbitrator.

At this point, it is crucial to remark the importance of ensuring equality between the parties and compliance with due process. Particularly, the problem arises when the claimant has ample time to prepare its case in depth before initiating the arbitration, but the respondent is unable to do so due to stringent time limits.

Therefore, sometimes it would be wise to remember the saying 'Speeding kills'.

3 Time Frame for the Award, Reasoning, Public Policy

Maybe the most attractive thing in fast track arbitrations is the existence of a short time limit for rendering the final award. According to most of the fast track arbitration rules, final awards must be given within six months. However, the starting date for the calculation of this time varies depending on (i) the date of the case management conference (the ICC), (ii) the date when the arbitrator received the file or (iii) the date when the tribunal is formed (the SIAC).

Although the SCC stipulates the award will be rendered within three months after the arbitrator received the case file, in practice, the SCC often extends this time limit when the sole arbitrator requests it. And yet, 55% of awards rendered under the SCC's expedited arbitration rules were rendered within three to six months after the registration of the case.

Just like the SCC, the ISTAC also sets a shorter time limit for rendering the final award. Accordingly, the arbitrator is expected to render a decision within three months after the arbitrator received the file or one month after the last statement or the last hearing, whichever occurs later.

In any case, all the rules for expedited procedures provide for the possibility of extending this time limit in

'exceptional circumstances' (the SIAC) or 'upon a reasoned request from the arbitrator; or, otherwise deemed necessary' (the SCC, the ICC and the ISTAC).

Additionally, an interesting point is whether the award will state reasons on with it is based. In fact, some institutions do not require the arbitrator to reason the award or allow reasoning in a summary form. For example, the SCC rules only require the award to contain reasoning if a party explicitly requests it. The SIAC rules require the arbitrator to state reasons at least in summary form, unless the parties have agreed that no reasons are to be given. The ICC and the ISTAC rules on the other hand do not contain any specific rules with regards to the reasoning of the award. Therefore, the general rule applies and the award must contain reasoning.

It is important to note the court precedents vary from country to country as to whether national authorities may refuse the recognition and enforcement of the award if the award lacks reasons. Therefore, if the seat of arbitration or possible enforcement place has the possibility of setting aside the award due to lack of reasoning, parties should pay significant attention to this risk and ask for a reasoned award in due time.

III Fast Track Arbitration-good, fast, and cheap?

The fast track arbitration rules introduced here are designed to make the arbitral process faster and cheaper. However, use of expedited procedures may have some serious consequences including the risk of setting aside the award.

Despite their importance, arbitration clauses are often a 'midnight clause': introduced at a time when all other points are agreed between the parties and no one wants to spend time on the detailed provisions for possible disputes. Therefore, it is not rare arbitration clauses do not take into account the specifics of the case.

Accordingly, bearing in mind the automatic application of fast track arbitration under some institutions, parties may suddenly find themselves in fast track arbitration, which might not perfectly be suitable for their case.

In this respect, careful attention must be given to the most important points that businesses should consider before opting for a fast track mechanism.

1 Not all cases are suitable for a fast track procedure:

Although the fast track arbitration rules may seem as a perfect tool when parties are seeking a speedy solution for their outstanding problem, they might not be appropriate in every arbitration case.

Most of the introduced rules in some way assume a dispute to be suitable for fast track arbitration when the amount in dispute is rather small. However, a dispute concerning a small amount does not necessarily mean that the case is easy to solve. Factually and/or legally complex cases are not suitable for fast track procedure.

Fast track arbitrations usually operate without any expert witness. This leads to a potential problem if the arbitrators do not have an expertise on the subject matter of the dispute. Therefore, if the dispute involves complex technical questions which may require the involvement of experts, it might not be prudent to go for fast track arbitration.

Likewise, under fast track arbitrations, arbitrators usually do not allow for extensive evidentiary proceedings. Arbitrators even have the authority to skip the hearings. Therefore, if the case is heavily relied on the witness statements rather than documentary evidence, the risk of no or limited hearing must always be bear in mind.

2 It matters who the arbitrator is.

A leading principle in international arbitration is that the arbitration is no better than the arbitrator. Th refore,

the key factor in a high-quality award in fast track proceedings is choosing an arbitrator who has an expertise on the subject matter of the dispute, and is available at the given time.

This may seem not a minor issue at the beginning but might have significant importance since the experienced arbitrator's schedules are generally so full they might not promise you to fulfill all the requirements of the fast track rules.

3 Short time limits require availability of resources and counsel

Equally important to the availability of the arbitrator is the availability of the counsel. The counsel needs to have the capacity to act swiftly within the required time limits and still make the best case. This also means the counsel needs to be able to access relevant documents, resources and evidence quickly and without unnecessary constraint.

The fast track arbitration must be distilled and focused even before the arbitration starts. In this respect, it is advisable to involve the counsel in the preparation of the evidence to ensure they are familiar with the facts, the law and the case strategy.

All in all, fast track arbitration certainly is an option businesses should keep in mind. This is especially relevant for countries like Turkey where national courts tend to be slow. However, for a fast track arbitration to be successful and satisfying, businesses should always assess the specifics of the case and whether these are in line with the specifics of fast track procedure.

First published by LexisNexis, 24.10.2018

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.

Similar Articles
Relevancy Powered by MondaqAI
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
Similar Articles
Relevancy Powered by MondaqAI
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