Enforcement of arbitral awards in Turkey: overview

A Q&A guide to enforcement of arbitral awards law in Turkey.

The Q&A gives a structured overview of the key practical issues concerning enforcement of arbitral awards in this jurisdiction, including definitions and preliminary proceedings; applicable conventions; enforcing awards; public policy, enforcement proceedings; formalities; actual enforcement; and any reform proposals.

This Q&A is part of the Enforcement of Judgments and Arbitral Awards in Commercial Matters Global Guide.

Feyzi Erçin and Sevgi Aydost, Erçin Bilgin Bektaşoğlu Law Firm
Contents

Enforcement of arbitral awards

Definitions and preliminary proceedings

1. What is the definition of an arbitral award in your jurisdiction for the purpose of enforcement proceedings?

For the purpose of enforcement, an "award" is a final and enforceable decision or the decision binding the parties, granted by the arbitrators.

 
2. Are decisions in preliminary/provisional proceedings recognised and enforceable?

The Turkish International Private and Procedural Code requires that in order to be enforced, an award must be final and have conclusive effect. Preliminary/provisional decisions are not final and are therefore not amenable for recognition and enforcement.

Applicable conventions

3. What conventions is your jurisdiction a contracting party to?

The UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention) is the primary legal source for enforcement of foreign awards in Turkey. Where a party to the arbitration is not a contracting state of the New York Convention, or the New York Convention is inapplicable due to the reservations of Turkey, then the rules provided under Article 60 and following of the Turkish International Private and Procedural Code (IPPC) applies. Turkey's reservations for the application of the New York Convention are that:

  • The award must be related to a commercial dispute.

  • The award must be made in a contracting state. The conditions regarding enforcement of foreign arbitral awards under the IPPC are parallel with the New York Convention.

Turkey is also a contracting party to the European Convention on International Commercial Arbitration 1961 (Geneva Convention).

Enforcing awards

4. What is the applicable statutory framework for enforcement of awards?

The legal framework for enforcement of arbitral awards in Turkey is as follows:

  • UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention).

  • The rules provided under Article 60 and following of the Turkish International Private and Procedural Code.

  • International Arbitration Law No. 4686.

  • If there are multilateral or bilateral agreements concerning the recognition and enforcement of arbitral awards, these are applicable by priority.

  • Turkish Civil Procedure Code is applicable if the award is domestic.

 
5. What are the grounds for refusing enforcement?

Domestic awards

There is no requirement of recognition and enforcement for domestic arbitral awards. However, the parties to an arbitral agreement have a right to file an annulment action against a domestic arbitral award (Article 439, Civil Procedure Code). The grounds for an annulment action are:

  • The parties of the arbitration agreement do not have the capacity to contract, or the arbitration agreement is otherwise invalid.

  • The composition of the arbitral tribunal or procedure is contrary to the arbitration agreement.

  • The award is not made within a determined period of time.

  • The arbitral tribunal exceeds the jurisdiction it was granted in the arbitration agreement.

  • The arbitral tribunal finds itself incompetent, lawfully or unlawfully.

  • The arbitral proceedings are not in accordance with the arbitration agreement.

  • There is a violation of equality of arms and right for both parties to be heard.

  • The subject matter is not arbitrable.

  • The enforcement of the award is contrary to public policy.

International awards

Under the UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention), a foreign award is to be recognised and enforced in any signatory state, unless the defendant proves the existence of the specific grounds set out in Article V of the New York Convention. The specific grounds are:

  • The parties to the arbitration agreement do not have the capacity to contract, or the agreement to arbitrate is otherwise invalid.

  • The party against whom the award is made did not have proper notice of the arbitration or could not present its case.

  • The award exceeds the scope of the arbitration agreement.

  • The composition of the arbitral panel or procedure is contrary to the agreement of the parties or the law of the forum country.

  • The award is set aside under the law of the forum country.

  • The subject matter is not arbitrable.

  • Enforcement of the award is contrary to public policy.

There are no significant differences between the rules of enforcement provided under the Turkish International Private and Procedural Code (IPPC) and the provisions of the New York Convention. For the enforcement of foreign arbitral awards in Turkey, the provisions of the IPPC are applicable only if the award is decided by a non-contracting (signatory) state to the New York Convention.

 
6. Is the enforcing court required to examine the refusal grounds during the enforcement proceedings ex officio?

The UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention) sets out five separate grounds on which recognition and enforcement of a New York Convention award can be refused at the request of the party against whom it is invoked. It is significant that under the New York Convention the burden of proof is not on the party seeking recognition and enforcement. The remaining two grounds on which recognition and enforcement can be refused relate to the public policy of the place of enforcement, and are grounds that can be invoked by the domestic court ex officio. Even if grounds for refusal of the recognition and enforcement of an award are proved to exist, the enforcing court is not obliged to refuse enforcement. The opening lines of paragraphs (1) and (2) of Article V say that enforcement "may" be refused. They do not say that it "must" be refused.

 
7. What is the effect of pending challenge proceedings in the foreign state where the decision is granted?

If there are any pending challenge proceedings in the foreign state where the decision is granted, then a decision will not be enforced until all legal remedies are exhausted and judgment becomes final.

 
8. What types of arbitral awards are enforceable?

Money awards

These are enforceable.

Awards containing injunctions ordering or prohibiting the doing of acts

These are enforceable.

Decisions or awards by arbitral tribunals (including emergency arbitrators) granting provisional measures

These are not enforceable.

Declaratory awards

These are not enforceable.

Other awards

Ex parte awards are enforceable.

 
9. Can parties seek to enforce only part of the award?

Parties can seek to enforce only part of the award (Article V/1-(c), UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention; Article 62, Turkish International Private and Procedural Code).

 
10. Are any class of awards excluded from recognition and enforcement? If so, what types of awards?

Other than applicable grounds for refusal (see Question 5) Turkish law does not specify any class of arbitral awards that categorically must be refused recognition and enforcement.

 
11. Will service that does not conform to the requirements of international treaties/regulations in force automatically result in a denial of the enforcement of an award?

The party against whom the award is invoked must be given proper notice of arbitrators or the arbitration proceedings (Article V-1(b), UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention)). Section 62-1(ç) of the Turkish International Private and Procedural Code is identical with the New York Convention in this respect. However, the enforcing court can only investigate the conditions regarding notice at the request of the party against whom the award is invoked.

 
12. What methods of service are not acceptable against defendants domiciled in the state where enforcement is sought?

The court will consider a given method of services as proper if it conforms to the lex arbitri, the arbitration agreement and the applicable arbitration rules.

Public policy

13. Which country's public policy applies? Does the court approach the issue differently depending on whether the award is a domestic or international award?

Domestic awards

According to Turkey's Code of Civil Procedure and the Turkish International Private and Procedural Code, Turkey's public policy applies.

International awards

The enforcement of the arbitral award can be refused if the enforcing court finds that the enforcement of the award would be contrary to the public policy of the enforcing country (Article V- 2( b), UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention) ; Article 62-1(b), Turkish International Private and Procedural Code).

 
14. In which cases and against which awards has the principle of public policy generally been applied?

If the enforcement of the award is inconsistent with the continuation of peaceful and compatible life of society, the principle of public policy generally applies. See Enforcement of judgments in Turkey: overview, Question 12.

 

Enforcement proceedings

Procedure

15. What is the procedure for enforcing arbitral awards?

Domestic awards

There is no requirement of recognition and enforcement for domestic arbitral awards. However, the parties to an arbitral agreement have the right to file an annulment action against a domestic arbitral award (Article 439, Turkish Civil Procedure Code).

Ex parte or on notice. Generally, applications for the annulment of domestic awards is ex parte unless otherwise stated by the enforcing court.

Applicable court. The applicable court is the court that is in the place of arbitration.

Limitation period. The limitation period for filing an annulment action is one month from the date of notification of the domestic award.

Timing. Under certain rules, a domestic arbitration must not last longer than a year, but there is no time limit for the enforcement/appeal process. This can take another year to conclude.

Court fees. See Enforcement of judgments in Turkey: overview, Question 22.

Recourse. Appeals can be filed for decisions in annulment actions for domestic awards (Article 439, Code of Civil Procedure).

International awards

The procedure for enforcing arbitral foreign awards is similar to the enforcement of foreign judgment. See Enforcement of judgments in Turkey: overview, Question 20.

Ex parte or on notice. See Enforcement of judgments in Turkey: overview, Question 22.

Applicable court. The applicable court is the civil court of first instance, which is determined by the parties of the arbitral agreement (Article 61, Turkish International Private and Procedural Code (IPPC)). If the applicable court is not determined by the parties, the court with jurisdiction is the court at the defendants' residence.

Limitation period. The time bar for applying for enforcement of awards is subject to lex arbitri. The start of the time bar is the date the award is finalised.

Timing. Around six to 12 months, excluding an appeal that takes another year or more.

Court fees. The court fee is subject to the law of the applicable court (Article 61, IPPC).

Recourse. Appeals can be filed against court decisions in relation to enforcement (Articles 57 and 61, IPPC).

 
16. Can the enforcing court review the foreign award if all formalities were complied with and if the award meets all requirements?

The powers of the enforcing court relating to review of the foreign award are similar to those for the enforcement of foreign judgments. See Enforcement of judgments in Turkey: overview, Question 23.

Formalities

17. What are the documentary requirements for enforcement?

Documentary requirements

The documentary requirements for enforcement of foreign arbitral awards are set out in Article 61 of the Turkish International Private and Procedural Code. Accordingly, an application for a declaration of enforceability of an arbitral award must be in the form of a petition in writing to the court. The documents that must be enclosed with the petition are as follows:

  • The original or its legalised copy of the arbitration agreement or arbitration clause.

  • The original or its legalised copy of the arbitral award that is final, binding and enforceable.

  • The certified translations of these documents.

Where the plaintiff instructed a lawyer for the application for enforcement of a foreign arbitral awards, a power of attorney in the Turkish language must be submitted. The formal requirements for a power of attorney are that it is executed by the plaintiff, legalised by a notary public and then certified either by the Turkish consulate or, where the HCCH Convention on the Conflicts of Laws Relating to the Form of Testamentary Dispositions 1961 (Hague Testamentary Dispositions Convention) applies, by an Apostille.

Authentication

See Enforcement of judgments in Turkey: overview, Question 24.

 
18. Is it required to translate the award into the language of the state where enforcement is requested?

Translations

All documents not in Turkish must be produced with Turkish translations.

Other languages

No language other than Turkish is recognised in Turkey.

Certification

The required translations must made by a certified translator and then certified by the notary public. If the translation is made outside Turkey, the translation must be certified by the Turkish consulate.

 
19. What is the format of the application for a declaration of enforceability?

Applications for declarations of enforceability are made in petitions.

 
20. What information must be included in the application regarding the award, the claim as awarded in the award, the facts and legal grounds of the case, and that the judgment is no longer appealable?
 
21. Is it possible to request the enforcing court for provisional measures pending the enforcement proceedings?
 
22. Is it required to convert the value of the award into the local currency?
 
23. Can the enforcing court stay the enforcement proceedings pending the outcome of proceedings to set aside the award at the seat of arbitration? If so, will the court order the party seeking the stay to provide security?

Not applicable for the purpose of Turkish proceedings as awards are not enforceable until all possible steps to have it set aside at the seat of arbitration are exhausted.

 

Actual enforcement

24. What is the enforcement procedure when a declaration of enforceability is granted?
 
25. Can defendants oppose the actual enforcement procedure, and if so, on what grounds/defences?
 

Proposals for reform

26. Are any changes to the law currently under consideration or being proposed?

There are currently no proposals for reform.

 

Online resources

Mevzuat

W www.mevzuat.gov.tr

Description. Official website of the Turkish Government containing regularly updated legislation in the Turkish language.

Ispramed

W www.ispramed.it/root/wp-content/uploads/2012/10/ippl_turkey.pdf

Description. Unofficial website, with an English translation of the Turkish International Private and Procedural Code.



Contributor profiles

Feyzi Erçin, Founding Partner

Erçin Bilgin Bektaşoğlu Law Firm

T +90 212 297 4101
F +90 212 297 4202
E feyzi.ercin@ebb-law.com
W www.ebb-law.com

Professional qualifications. Istanbul, Turkey, Lawyer, 1995

Areas of practice. Aviation; shipping; insurance; litigation.

Recent transactions

  • Handling two of three major aviation losses in Turkey; Turkish Airlines' total loss in 2003, as well as the Atlasjet total loss in 2007, both on behalf of British and American (re)insurers.
  • Advising (re)insurers on coverage and litigation of aviation matters.
  • Acting for various UK and Scandinavian P&I Clubs in admiralty matters.
  • Having experience on cargo claims, bill of lading and charter-party disputes, providing legal opinions to foreign litigations.
  • Advising a local underwriter on their first major D&O liability coverage.
  • Handling a major Turkish arbitration for a large Austrian energy corporation.

Languages. Turkish, English

Professional associations/memberships. Member, Istanbul Bar Association, 1999; member, Istanbul Maritime Law Association, 1997.

Sevgi Aydost, Associate Lawyer

Erçin Bilgin Bektaşoğlu Law Firm

T +90 212 297 4101
F +90 212 297 4202
E sevgi.aydost@ebb-law.com
W www.ebb-law.com

Professional qualifications. Istanbul, Turkey, Lawyer, 2015

Languages. Turkish, English


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