Turkey: Litigation Dispute Resolution Comparative Guide

1 Legal framework

1.1 What system of jurisprudence applies in your jurisdiction? What implications does this have for litigation?

Turkey has a civil law system based on codified laws. Case law is taken into consideration in the interpretation of laws. Only decisions of a higher chamber of the Court of Appeal (which is responsible for resolving inconsistencies between different judgments of chambers in similar disputes) are binding on lower courts. However, higher court decisions have a significant influence on the lower courts, to ensure uniformity in judicial practice. Doctrine and international law are other important sources for the interpretation of the law.

1.2 What rules govern litigation in your jurisdiction?

The Code of Civil Procedure (6100) is the main legislative instrument with regard to civil procedure. It stipulates the procedural rules that apply to all litigation being adjudicated by civil courts.

The Code of Criminal Procedure (5271) stipulates the procedure for criminal trials.

The Code of Administrative Procedure (2577) stipulates the procedural for administrative trials.

1.3 Do any special regimes apply to specific claims?

The principal law governing international arbitration is the International Arbitration Law (4686).

The International Private Law and Civil Procedure Law (5718) includes certain procedural provisions applicable for disputes with an international element.

There are also some specific procedural rules regulated by the Commercial Code (6102) and the Code of Labour Courts (7036), among others.

1.4 Which bilateral and multilateral instruments have relevance to litigation in your jurisdiction?

Turkey is a signatory to numerous bilateral and multilateral agreements. Most of these are relevant to both civil and criminal litigation in Turkey. They include the following:

• the Charter of the United Nations (1945);
• the Universal Declaration of Human Rights (1948);
• the International Covenant on Economic, Social and Cultural Rights (1966);
• the Convention on the Elimination of All Forms of Discrimination against Women (1979);
• the Convention on Children's Rights (1989);
• the Convention relating to Civil Procedure (1954);
• the Convention Abolishing the Requirement of Legalisation for Foreign Public Documents (1961);
• the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters (1965); and
• the Convention on the Taking of Evidence Abroad in Civil or Commercial Matters (1970).

Turkey is also a party to the World Trade Organization General Agreement on Tariffs and Trade and currently has 22 free trade agreements in force with the following jurisdictions: the European Free Trade Association, Israel, Macedonia, Bosnia-Herzegovina, Palestine, Tunisia, Morocco, Egypt, Albania, Georgia, Montenegro, Serbia, Chile, Mauritius, South Korea, Malaysia, Moldova, the Faroe Islands, Singapore, Kosovo, Venezuela and the United Kingdom.

Turkey has also concluded agreements for the avoidance of double taxation with the following jurisdictions: Albania, Algeria, Azerbaijan, Austria, Belarus, Belgium, Bulgaria, China, Croatia, Denmark, Egypt, Finland, France, Germany, Hungary, India, Indonesia, Israel, Italy, Japan, Jordan, Kazakhstan, South Korea, Kuwait, Kyrgyzstan, Lithuania, Macedonia, Malaysia, Moldova, Mongolia, the Netherlands, Northern Cyprus, Norway, Pakistan, Poland, Romania, Russia, Saudi Arabia, Singapore, Slovakia, Sweden, Tajikistan, Tunisia, Turkmenistan, Ukraine, the United Arab Emirates, the United States, the United Kingdom and Uzbekistan.

2 Judicial structure

2.1 What courts exist in your jurisdiction and how are they structured?

The judiciary in Turkey is divided into:

• the Constitutional Court;
• the civil and criminal courts;
• the administrative courts; and
• the courts of jurisdictional conflict.

There are three instances of courts among the civil, criminal and administrative courts, as follows:

• the courts of first instance;
• the regional courts of appeal (courts of second instance); and
• the Higher Court of Appeal/State Council.

The regional courts of appeal, which are the first tier of the appellate system, have jurisdiction over the appeals in a specified region. The Higher Court of Appeal has country-wide jurisdiction. The Higher Court of Appeal consists of various chambers specialised in different types of disputes.

2.2 What specialist courts or tribunals exist in your jurisdiction?

There are specialised civil courts for certain legal areas, such as:

• the cadastral courts;
• the commercial courts;
• the consumer courts;
• the enforcement courts;
• the family courts;
• the intellectual and industrial property courts; and
• the labour courts.

Alternative dispute resolution (ADR) methods, such as mediation and arbitration, are also available in Turkey. The Istanbul Chamber of Commerce has set up its own independent arbitration centre, Istanbul Chamber of Commerce Arbitration Institution and Mediation Centre. Another independent arbitration centre is the Istanbul Arbitration Centre.

Although this is not considered as a method of ADR, an ombudsman is also available in Turkey for the resolution of matters regarding public services delivered by government authorities and institutions.

3 Pre-litigation

3.1 What formalities apply before litigation can be commenced in your jurisdiction?

As of 2018, mediation is mandatory in disputes between an employee and an employer regarding employee receivables and reemployment claims before filing a lawsuit on the matter.

Certain commercial disputes have also been included within the scope of mandatory mediation as from 1 January 2019.

In addition, on 28 July 2020, Turkey enacted the Law Amending the Civil Procedure Law and Certain Laws, which introduced Article 73/A to the Consumer Protection Law. With this amendment, consumer disputes with a value of over TL 11,330 for 2021 are included within the scope of mandatory mediation.

Some other quasi-legal authorities that must be availed of before applying to court include:

• the Arbitration Committee for Consumer Problems;
• the Sports Arbitration Committee; and
• the Turkish Football Federation Arbitration Committee.

3.2 Do any pre-action protocols or similar rules apply prior to the commencement of litigation? What are the consequences of non-compliance?

In general, pre-action conduct is not required under Turkish law. The plaintiff can initiate a lawsuit before notifying the other party. However, in commercial disputes, sending notification before initiating a lawsuit is common practice.

The main form of pre-action conduct in Turkish law is an application for mandatory mediation. As stated in question 3.1, most lawsuits regarding employment, commercial and consumer disputes cannot be filed before completing a mandatory mediation process. The plaintiff must submit to the court the minutes of the last mediation meeting which state that the parties could not reach a settlement. If the mediation process is not duly carried out, the court will reject the case due to lack of a cause of action, without examining the merits of the case.

3.3 What other factors should a party consider before commencing litigation in your jurisdiction?

Legal actions have no predictable timetable and litigation can be time consuming.

If a plaintiff loses its claim, it will be reimbursed the court charges which it paid to file the claim. However, due to currency fluctuations, foreign plaintiffs will assume a foreign exchange risk in this regard.

4 Commencing litigation

4.1 What rules on limitations periods apply in your jurisdiction?

As per the Code of Obligations, the principle statute of limitations is 10 years, starting from the date of maturity of the obligation.

However, the statute of limitations is five years for some claims, such as those relating to the following:

• lease payments;
• principal interest;
• severance pay and salary;
• claims arising out of attorney;
• agency, commission and certain brokerage agreements;
• claims between a company or its shareholders and its managers, representatives or auditors;
• claims between the shareholders arising from a shareholding agreement; and
• claims arising from work contracts, except for those arising from improper performance or non-performance due to a contractor's gross fault.

The statute of limitations for tort claims is two years as of the date on which the plaintiff becomes aware of the tortious act, the damage and the person committing it, within the upper limitation of 10 years.

Time limits are treated as a substantive law issue. Expiration of the statute of limitations as a plea should be raised by the defendant. The court cannot ex officio take into consideration time limitations.

4.2 What rules on jurisdiction and how this is determined apply in your jurisdiction?

In international disputes, the jurisdiction of the Turkish courts is determined according to the International Private Law and Civil Procedure Law.

In general, civil jurisdiction is regulated by the Code of Civil Procedure. The main principle is that the competent court is the court of the residence of the defendant. In addition to this general principle, contractual claims can be filed before a Turkish court if the contract will be performed in Turkey. Tort claims can also be filed in Turkey if the plaintiff is residing in Turkey or if the damage has been suffered in Turkey. The exclusive competent court for claims in respect of in rem rights relating to real property located in Turkey are the Turkish courts, regardless of the residence of the parties. As a rule, unless there is a mandatory jurisdiction of a specific court, the Turkish jurisdiction system allows merchants and public authorities to agree on an exclusive jurisdiction clause that is written and clearly expressed.

In criminal law, jurisdiction is regulated by the Code of Criminal Procedure. Territorial competence is determined based on the place at which the crime was committed.

4.3 Are class actions permitted in your jurisdiction?

Turkey has no mechanism for class actions.

A group action was introduced to the Turkish legal system by the Code of Civil Procedure. Group actions allow associations and other legal entities to file actions on their own behalf to protect the rights of their members or the groups they represent.

These actions can be commenced exclusively for the purposes of:

• determining the rights of the individuals concerned;
• rectifying an unlawful situation; or
• preventing a probable violation of the rights of the individuals concerned.

Group actions do not allow the plaintiff to claim compensation for the damages suffered by its members or the group it represents. Group actions are available only for entities with legal personality. In other words, it is not possible for individuals to file a group action. In order for a plaintiff legal entity to file a group action, its internal statutes must include the right to file an action on behalf of its members or the group that it represents.

4.4 What are the formal requirements for commencing litigation?

A statement of claim must be filed with the court in order to commence the litigation. Proceedings are deemed to be commenced on the date on which the statement of claim is submitted to the court by the plaintiff. The plaintiff must hand in sufficient copies of the submission itself and its attachments (ie, sufficient copies for the court and one copy for each opposing party). The court will serve the statement of claim on the parties concerned.

Any represented plaintiff must submit a contemporaneous, duly signed power of attorney issued in order for the case to be tried. There are two types of procedure in Turkey:

• the written procedure (the main procedure), in which there are two rounds of written submissions (statement of claim and statement of defence; reply and rejoinder); and
• the simplified procedure, in which only the statement of claim and the statement of defence can be filed by the parties and no further exchange of petitions can be carried out.

The main stages of the civil proceedings are as follows:

• exchange of petitions;
• preliminary proceedings;
• trial phase; and
• oral proceedings.

4.5 What are the procedural and substantive requirements for commencing litigation?

The plaintiff must submit a statement of the claim to the court and the court will serve the statement of the claim on the other parties. There are two types of service:

• the conventional way, by post; and
• electronically, by email.

The plaintiff must also pay a certain part of the court fees when commencing litigation.

The statement of claim must include the following information:

• the name of the court;
• the names and addresses of the plaintiff and defendant;
• the Turkish ID number of the plaintiff;
• the name and address of the representative of the plaintiff, if any;
• a statement of the value in dispute;
• the allegations of fact;
• evidence submitted for each allegation of fact;
• a statement of legal grounds;
• the precisely stated claim; and
• the signature of the plaintiff or the representative.

If the dispute is subject to mandatory mediation, the plaintiff should also submit duly signed minutes stating that the parties could not reach an agreement at the end of the mediation process.

The plaintiffs must present their legitimate interest for filing the claim.

The case must be filed with the court which has territorial and substantive jurisdiction; the parties have the capacity to be a party to the proceedings and the capacity to sue/be sued before the court.

The claim must not be subject to another pending litigation and must not form part of an enforceable judgment.

If applicable, security for costs must be deposited.

4.6 Are interim remedies available in your jurisdiction? If so, how are they obtained?

There are three types of interim remedies under Turkish law:

• preliminary injunction;
• precautionary attachment order; and
• determination of evidence.

The court can grant a preliminary injunction if either:

• it would be significantly difficult or impossible for the plaintiff to enforce its rights in the future due to any change in the present status; or
• severe damage or inconvenience is likely to occur due to the delay.

The court can order the plaintiff to provide security in an amount that the court considers proper to account for the damage that may be caused to the defendant (usually 15% of the amount in dispute).

As another interim remedy, a precautionary attachment order can be granted for due and undue debts that are not secured by a pledge. If the debt is due and payable, the plaintiff must prove that there is a due debt by submitting the relevant documents. To obtain a precautionary attachment order for undue debts, the creditor must prove that the debtor either:

• does not have a certain residence; or
• is preparing to conceal and transfer its assets or flee the jurisdiction.

The court can determine the security (usually 15% of the amount in dispute) to be deposited.

A determination of evidence is another interim remedy that is commonly available. The parties to a dispute can request the determination of evidence through discovery, expert examination or witness statements, to rely on this evidence in an ongoing or possible future action. A party is deemed to have a legal interest in making an application if either:

• there is a risk that the evidence will be lost; or
• it will be significantly difficult to rely on the evidence in the future.

4.7 Under what circumstances must security for costs be provided?

The defendant can request from the court an order that the plaintiff will provide security for litigation costs, provided that:

• the plaintiff is a Turkish citizen who does not have a residence in Turkey; or
• the plaintiff's financial difficulty (eg, insolvency or debt restructuring proceedings) is documented by the defendant.

Furthermore, foreign plaintiffs must provide security for costs as well as for possible damages of the counterparty, unless there is a contractual, de facto or legal reciprocity which enables Turkish plaintiffs to file lawsuits in the state of which the foreign plaintiff is a national without providing security for costs.

5 Disclosure

5.1 What rules apply to disclosure in your jurisdiction? Do any exceptions apply to certain types of documents?

There is no full disclosure mechanism under Turkish law. In principle, the disclosure obligation is limited to the evidence on which either party bases its allegations. However, the parties are entitled to request from the court the collection of evidence from the counterparty or from third parties and institutions.

Pre-action disclosure is limited to requesting from the court the collection of evidence by way of examination, on-site expert examination or witness testimonies. There is no obligation of disclosure specified according to different classes of documents.

5.2 What rules on third-party disclosure apply in your jurisdiction?

If any document constituting evidence is under the possession of a third party, the court can order the disclosure of such evidence which is deemed mandatory to prove the allegations of the parties. If ordered to do so by the court, third parties are obliged to disclose such documents; if they fail to do so, they should explain the reason for their failure to disclose. If the court does not find this explanation sufficient, it can decide to hear the third party as a witness. Third parties may refuse to provide documents or testify if they have a right of exemption from testifying, such as:

• family privilege;
• privilege against self-incrimination;
• attorney-client privilege; and
• privilege of trade secrets.

5.3 What rules on privilege apply in your jurisdiction? Does attorney-client privilege extend to in-house counsel?

As there is no compulsory full disclosure mechanism under Turkish law, there is no specific privilege regulation. However, as per the Attorneys' Code, attorneys are prohibited from disclosing information which they receive from their clients. In order for an attorney to testify regarding such information, the client's consent is required. Even then, however, the attorney may exercise the right of exemption from testifying.

The Turkish Competition Board has decided that documents and correspondence between an independent lawyer and a client are privileged, and that their confidentiality is thus protected. However, as an in-house counsel and his or her ‘client' have an employee-employer relationship, without true independence, documents and correspondence between an in-house counsel and his or her employer will not be considered privileged and will not be protected.

5.4 How have technological advances affected the disclosure process in your jurisdiction?

In enforcement proceedings, attorneys who represent the judgment creditor can access certain information about judgment debtors via an electronic system. The COVID-19 pandemic has also expedited the implementation of remote hearings.

5.5 What specific considerations should be borne in mind during the disclosure process, for both plaintiff and defendant?

Only the court can order the disclosure of documents by the parties to the dispute or third parties. There are no restrictions on the use of the documents obtained through disclosure. However, the parties may request from the court that the submitted documents and information be kept confidential.

6 Evidence

6.1 What types of evidence are permissible in your jurisdiction?

In civil proceedings, the provisions on proof of evidence are set forth in Articles 183–293 of the Code of Civil Procedure, which specify the different types of evidence (eg, documentary, oath, witness, expert examination, on-site visit, private expert opinion). However, the provisions do not include a numerus clausus list and anything can be regarded as evidence by the courts. In other words, it is possible to produce other types of evidence not specified under the law that can constitute a means of proof.

Except for any legal exceptions, the courts will freely evaluate the evidence. For instance, witness testimonies, expert examinations, on-site visits and private expert opinions are not binding and are subject to the court's discretion.

Witness evidence cannot be considered in disputes with a value of over TL 4,880 (for the year 2021). Plaintiffs must produce documents or written contracts for any claim exceeding this value.

The civil courts cannot gather evidence other than that presented by the parties, with certain exceptions (eg, legal actions on divorce).

6.2 What rules apply to expert evidence in your jurisdiction? What specific considerations should be borne in mind when preparing and presenting expert evidence?

The Code of Civil Procedure governs expert examinations and private expert opinions separately.

The court can decide to carry out an expert examination for the resolution of disputes that require technical knowledge, either ex officio or upon the request of either party. It is carried out by a court-appointed expert, selected from a list of experts in each relevant civil jurisdiction commission. The examination can be carried out by a sole expert or a panel of experts, depending on the complexity and scope of the case. The court will determine the scope of the examination and the questions that the experts will answer. The expert's report must be submitted in writing, within the timeframe set by the court. The experts' responsibilities are to the courts and the experts answer to the court. The parties may submit statements and, if any, objections to the expert reports. If it deems this necessary, the court may request a supplemental report from the expert(s) or appoint a new (panel of) expert(s).

In principle, an expert examination cannot be conducted on subjects that may be resolved through the general and legal knowledge of the judges.

The parties can also submit expert opinion(s) prepared by private experts. The parties are not entitled to request additional time for the submission of a private expert opinion. The courts may summon the private experts to present their statement at a hearing, either ex officio or upon request of a party. If the private expert does not attend a hearing without a valid excuse, his or her professional opinion will be disregarded. The experts' responsibilities are to the relevant party that engaged him or her.

6.3 What other factors should be borne in mind when preparing and presenting evidence in your jurisdiction?

Both parties must consider the time limits for the submission of new allegations and evidence. Please see question 7.5 for details.

7 Court proceedings

7.1 What case management powers do the courts have in your jurisdiction?

In general, the case management structure is strict under Turkish law. Unless otherwise provided in the law or ordered by the court, all submissions (ie, reply and rejoinder, objections to expert reports and appeal requests) must be made within two weeks. As noted in question 7.5, all evidence must be submitted with the last submission of the relevant party, in the exchange of petitions phase.

The courts can take any necessary measures for the management and conduct of the case. The parties to the dispute, relevant third parties and other public authorities must comply with and respond to the court's orders and/or any request for resolution of the dispute.

At the request of any party, the court can decide to:

• conduct an expert examination and/or on-site visits;
• hear witnesses and private experts whose opinions have been submitted; and
• decide on interim remedies (see question 4.6).

7.2 Are court proceedings in your jurisdiction public or private? If the former, are any options available to the parties to keep the proceedings or related information confidential?

In principle, court proceedings are public in Turkey. The parties and their attorneys can examine the court files and make copies of any documents filed. Also, all attorneys admitted to the Turkish Bar Association can examine the court files, even if they do not represent any of the parties. In the latter case, the attorneys cannot make copies of any documents. Any person is allowed to be present at the courtroom during the oral hearings.

It is at the court's discretion to keep the proceedings or related information confidential. In exceptional cases, the court may decide – ex officio or at the request of a party – for hearings to be held in private for public morality and/or security reasons, or where the superior interest of a party makes confidentiality an absolute necessity.

7.3 How is the applicable law determined? What happens in the event of a conflict of laws?

Under Turkish law, the main principle is the free choice of law. As per Article 2(4) of the International Private Law and Civil Procedure Law (IPPL), "in cases where there is a possibility of choosing the applicable law, unless otherwise designated by the parties, the substantive provisions of the chosen law shall be applied".

If the parties have made no such choice, the determination of the applicable law to the disputes will be made according to the provisions of the IPPL. As per Article 2(1)(2) of the IPPL: "The judge shall apply the rules of the Turkish conflict of laws and the governing foreign law which is applicable in accordance with the said rules ex officio. The judge may seek assistance of the parties for the determination of the content of the governing foreign law. If the applicable foreign law provisions cannot be ascertained despite all efforts, Turkish law shall be applied."

This being the case, Turkish law will be applied where:

• the foreign law violates Turkish public order;
• there are mandatory provisions to be applied in a particular dispute; or
• the applicable foreign law provisions cannot be ascertained despite all efforts.

7.4 What rules apply to the joinder of third parties?

The notification of and intervention to the case are governed under Articles 61–69 of the Code of Civil Procedure.

If a party to a case considers that a subsequent recourse action will be filed by or against a third party, it may request that the court notify the proceedings to that third party. Even if no notification has been made, a third party which considers that the decision of the court may affect its rights and/or lead to a recourse action may request from the court that it be involved in the ongoing proceeding as an intervenor. The intervenor can choose which side it will take. The intervenor is bound by the claims, defences and evidence submitted by the relevant party.

7.5 How do the court proceedings unfold in your jurisdiction? What specific considerations should be borne in mind at each stage of the process, for both plaintiff and defendant?

As mentioned in question 4, there are two types of procedures in Turkish civil court proceedings: the written procedure and the simplified procedure. The relevant procedures vary in their evidentiary requirements and submissions.

In the written procedure (the main type), there are two rounds of written submissions: statement of claim and statement of defence; and reply and rejoinder. The plaintiff's right to raise new allegations and submit new evidence is limited until submission of the reply; while the defendant's right to raise new defences and submit new evidence is limited until submission of the rejoinder.

In the simplified procedure, there is only one round of written submissions and the parties are allowed to submit only a statement of claim and a statement of defence. The parties' right to submit new claims/defences and evidence is limited to the date of submission of the relevant petitions.

In principle, no further exchange of petitions can be carried out after the relevant petitions have been filed.

The main stages of the civil proceedings are as follows:

• exchange of petitions;
• preliminary proceedings;
• trial phase; and
• oral hearings.

Turkish law requires mandatory mediation before initiating court proceedings for various types of disputes (eg, employment disputes, consumer disputes and commercial disputes arising from payment of a receivable or compensation).

7.6 What is the typical timeframe for the court proceedings?

The timeframe for the court proceedings may differ based on the type of procedure and the complexity of the case. On average, from filing for mediation until receipt of a judgment from the first-instance court, the trial takes between one and 2.5 years.

Where the decision is subject to appeal before the regional court of appeal, the appeal process takes approximately one to two years.

Where the appeal decision is subject to appeal before the Higher Court of Appeal, the appeal process takes approximately one to two years.

8 Judgment and remedies

8.1 What types of judgments, orders and other remedies are available in your jurisdiction?

The Turkish courts may render interim decisions and final decisions. The final decisions of the court may be:

• declaratory – that is, determining the existence or absence of a right or a relationship between the parties;
• constitutive – that is, changing, revoking or creating a new legal status or position; or
• ordering – that is, granting, performing or refraining from doing something.

The courts may also order preliminary injunctions or precautionary attachments. For details, please see question 4.6.

9 Appeals

9.1 On what grounds may a judgment be appealed in your jurisdiction?

The grounds of appeal should be separately examined for:

• the appeal of a first-instance court decision before the regional court of appeal; and
• the appeal of a regional court of appeal decisions before the Higher Court of Appeal.

In principle, all final decisions of the courts of first instance can be appealed to the regional court of appeal, except for decisions concerning pecuniary matters with a value of less than TL 5,880 (for 2021; for civil execution court decisions, the appeal limit is TL 13,740).

There are no limitations on the grounds for appeal to the regional court of appeal, and any wrong application of procedural or substantive law or factual error may be a ground for appeal. The regional court of appeal will also take any breach of public order into consideration ex officio.

In principle, the final decisions of the regional court of appeal can be appealed to the Higher Court of Appeal, except for the decisions concerning pecuniary matters with a value of less than TL 78,630 (for 2021).

The grounds for appeal to the Higher Court of Appeal include:

• wrongful application of the law;
• the absence of preliminary requirements to file an action;
• unlawful dismissal of evidence; and
• the existence of procedural mistakes or deficiencies affecting the judgment.

9.2 What is the appeals process? Is the judgment stayed while the appeal is pending?

Unless exceptional time limits are set by specific laws in certain areas, the parties may file a request for appeal within two weeks of service of the court's reasoned decision.

Apart from exceptional cases where the court's decision must be finalised in order to execute the decision, the winning party will have the right to file an execution case before the execution office; it need not wait for the decision to be given by the appeal courts. In other words, filing an appeal will not stay the execution of the decision of the local court.

At the plaintiff's request, the execution office will serve a payment order on the losing party. Once the payment order is served, the judgment debtor will have seven days to make the required payment to the execution office. The objections which the judgment debtor can make against such payment order are limited to the following claims:

• The receivable has been time barred;
• The receivable has been fully paid; or
• The judgment creditor provided a grace period to the judgment debtor (the decision to be rendered by the court upon such claim is referred to as a ‘decision on the postponement of proceedings').

If the judgment debtor makes none of these claims or if such claims are rejected, to stay the execution, the party against which the decision has been rendered (ie, the judgment debtor) must appeal the decision and post security covering the entire amount of the award decided by the court. If the judgment debtor cannot post such security, the judgment creditor may carry out attachment.

9.3 What specific considerations should be borne in mind during the appeals process, for both plaintiff and defendant?

Both parties should consider the time limits for submission of the appeal and the reply to the appeal.

If the court's decision is not among the decisions which must be finalised in order to execute the decision, the judgment debtor should also consider whether an execution proceeding has been initiated by the judgment creditor and take the seven-day payment term for depositing the security term into account.

If the judgment debtor deposits a security and requests a stay of execution, this request should also be expressly noted in the appeal petition.

10 Enforcement

10.1 How are domestic judgments enforced in your jurisdiction?

Any decision which does not fall within the scope of those decisions that must be finalised in order to execute them can be subject directly to an execution proceeding. Within this scope, if the judgment debtor does not voluntarily perform the judgment, the judgment creditor can initiate an execution proceeding before the execution office.

10.2 How are foreign judgments enforced in your jurisdiction?

The recognition and enforcement of foreign judgments in Turkey are subject to the multilateral or bilateral treaties that are in force between Turkey and the country in which the decision was issued, or de facto reciprocity between two countries. Foreign judgments can be executed after their recognition and enforcement in Turkey.

The requirements for recognition and enforcement of a foreign decision are set out in Articles 54 to 58 of the International Private Law and Civil Procedure Law, as follows:

• The right of defence of the party against which enforcement is sought in Turkey must have been respected before the foreign court;
• The foreign decision must be final under the laws of the foreign country;
• The foreign decision should not be regarding an issue that is subject to the exclusive jurisdiction of the Turkish courts; and
• The foreign decision must be in compliance with Turkish public order.

The Turkish courts will examine ex officio whether the above conditions are met.

10.3 What specific considerations should be borne in mind during the enforcement process, for both plaintiff and defendant?

Foreign decisions which are in violation of public policy cannot be enforced in Turkey. The Turkish courts will examine ex officio whether the foreign decision is in violation of Turkish public policy. Within this scope, the judgment creditor should consider and ensure that the foreign decision is not against public policy.

The recognition and enforcement of foreign decisions are possible only where there is a mutual agreement (bilateral or multilateral), a legal provision (de jure application) or a de facto application for enforcement of foreign decisions between the foreign country and Turkey.

11 Costs, fees and funding

11.1 What costs and fees are incurred when litigating in your jurisdiction?

The main costs of civil court proceedings are:

• application fees (which may be fixed or proportionate, depending on the case);
• litigation expenses (eg, notification fees, expert fees); and
• statutory attorneys' fees.

Litigation costs and official attorneys' fees, determined as per the Minimum Attorney Fee Tariff, must be borne by the losing party. If both parties partially succeed, costs will be divided proportionally between them. The professional attorneys' fees agreed between a party and its attorneys and the fees paid to professionals to obtain a private expert opinion are not reimbursable under Turkish law.

11.2 Are contingency fees and similar arrangements permitted in your jurisdiction?

Contingency fees are valid if the conditions of the contingency fee arrangement do not contravene the Turkish Attorneyship Law (1136). The agreed fees cannot be lower than the minimum amounts set out in the Minimum Attorney Fee Tariff and cannot exceed 25% of the total value of the dispute.

11.3 Is third-party funding permitted in your jurisdiction?

There are no provisions regulating third-party funding under Turkish law. It is possible for a third party to fund the litigation based on an agreement with the relevant party; in other words, this method of funding is possible based on the freedom of contract and the general provisions of the Code of Obligations (6098).

11.4 What other strategies should parties consider to mitigate the costs of litigation?

For monetary claims, it is possible to file a partial claim or an unquantified claim, provided that the claim is divisible or is unknown at the time of filing. By way of a partial claim, the party can request only part of the total amount in dispute and reduce the procedural costs.

The parties may also consider alternative dispute resolution mechanisms.

12 Trends and predictions

12.1 How would you describe the current litigation landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The Turkish courts have a heavy workload, which means that the litigation process is protracted. Since the establishment of the regional court of appeals, the process takes even longer. As an alternative, there is an increasing interest in domestic arbitration at the Istanbul Arbitration Centre and the Istanbul Chamber of Commerce Arbitration Institution and Mediation Centre, which allows for the quicker resolution of disputes.

We do not anticipate any major legislative reforms in the next 12 months.

13 Tips and traps

13.1 What would be your recommendations to parties facing litigation in your jurisdiction and what potential pitfalls would you highlight?

Given that litigation in Turkey is time consuming, the parties may consider other ways to settle their disputes.

Court charges will be paid in Turkish lira as of the date of commencement of the litigation. Thus, foreign plaintiffs that lose their claim will assume a foreign exchange risk due to currency fluctuations.

Co-Authored by Ozlem Cavus Gercek

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.