A court decision is effective in the country where the court made this decision as a consequence of sovereignty and judicial power of nations which shall not be intervened by a foreign country. However; a court decision made by foreign court can be applicable in another country if certain conditions stated in their legislation are fulfilled.
As well as court decisions, applicability of foreign arbitral awards also depends on fulfilment the conditions specified in legislation.
Enforcement process shall be completed in order to execute the foreign arbitral award in Turkey. Provisions regarding enforcement of foreign arbitral awards in Turkey are regulated under Turkish International Private and Procedural Law ("IPPL") dated 27.11.2007 and numbered 5718 and New York Agreement dated 10th June 1958 ("New York Agreement") and published in Official Gazette numbered 20877 and dated 21.05.1991.
Pursuant to Article 2 of the Code numbered 3731 which had been published in Official Gazette numbered 20877 and dated 21.05.1991, provisions of New York Agreement shall be applied to enforcement of arbitral awards which are given in a country which is a party to New York Agreement. However, provisions of IPPL are applied for the enforcement of arbitral award if the country where arbitral award is given is not a party to New York Agreement.
Recognition and enforcement of foreign arbitral awards are regulated under Article 50 and the rest of IPPL. Article 62 of IPPL regulates that foreign arbitral award cannot be enforced under which circumstances;
(1) The court shall dismiss the enforcement request of a foreign arbitral award, if,
a) An arbitration agreement is not executed or arbitration clause does not exist in the main agreement,
b) The arbitral award is contrary to public morality or public order,
c) It is not possible to settle the dispute subject to the arbitral award by way of arbitration under Turkish law,
ç) One of the parties has not been duly represented before the arbitrators and has not expressly accepted the acts concluded thereafter,
d) The party against whom the enforcement of the arbitral award is requested has not been duly notified of the appointment of arbitrators or has been deprived of his/her right to make claim and defense,
e) The arbitration agreement or clause is invalid pursuant to the governing law designated by the parties, or in the absence thereof, pursuant to the law of the place where the arbitral award is rendered,
f) The appointment of the arbitrators or the procedure applied by the arbitrators violates the agreement of the parties, or in the absence thereof, the law of state where the arbitral award is rendered,
g) The arbitral award has been rendered on an issue that is not included in the arbitration agreement or arbitration clause or exceeds the limits of the agreement or the clause (only the exceeding part),
h) The arbitral award is not final, enforceable, or binding under the governing law or the governing procedure or the law of state where it was rendered or it is annulled by the competent authority in the place where the award is rendered.
(2) The burden of proof regarding issues addressed in the paragraphs (ç), (d), (e), (f), (g), and (h) above, lies on the party against whom enforcement is requested."
In addition to this provision, IPPL specifies which foreign arbitral awards are subject to enforcement. Pursuant to Article 60 of IPPL, final and executable or binding upon the parties foreign arbitral awards may be subject to enforcement.
Considering Article 60 and 62 of IPPL, it can be concluded that a foreign arbitral award can be subject to enforcement if this arbitral award is final and executable or binding upon the parties.
Interim decisions, which are given in order to evaluate dispute before the court or arbitral tribunal easier, do not have the characteristics of final decision since the purpose of these decisions is taking precaution before jurisdiction and/or verdict. Therefore, such interim decisions as interim injunctions or interim attachments which are decided by foreign arbitral tribunal will not be considered as final decision.
Turkish courts will dismiss the enforcement request of such foreign arbitral awards which do not have characteristics of final decision because preconditions regulated under Article 60 and 62 of IPPL regarding final or binding upon the parties are not fulfilled.
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.