The CISG: What Differentiates a Valid and Binding Offer from a Mere Proposal?

According to the offer and acceptance model of contract formation, an offer constitutes the starting point in the contract formation process.Following the manifestation of an offer, a contract is concluded when it is reciprocated with an acceptance by the offeree. Although the general outline is as simple as that, there are certain vital questions that must be addressed in order to assess whether, when and in what scope a valid contract is concluded. One of these questions is “What differentiates a valid and binding offer from a mere proposal?”

Under CISG, there are certain criteria that a proposal must meet in order for it to constitute a valid and effective offer in the sense of the Convention. These criteria, which are laid down under Article 14 of the Convention, can be categorized under three points: firstly, the proposal must be addressed to one or more specific persons, secondly it must indicate the intention of the offeror to be bound by such proposal in case of acceptance and thirdly, it must be sufficiently definite.

Definiteness of the addressee

Article 14(2) of CISG establishes that a proposal is considered as a mere invitation to make offer if it is not addressed to one or more specific persons; unless the offeror clearly indicates otherwise.  In other words, in principle, an offer must be addressed to a specific person or group of persons in order to hold a binding effect; otherwise such manifestation is considered only as “an invitation to make an offer” for the other party (invitatio ad offerendum). Hence, when the addressee of an offer is indefinite, the offer would not bind the offeror, unless otherwise is indicated by the offeror.

Nevertheless, an offer which is addressed to an indefinite group of persons may still be binding upon the offeror if the offeror clearly demonstrates its intention to be bound by such offer. Under English law, on the other hand, there is no such requirement that a proposal must be addressed to one or more specific persons; rendering the public offers binding upon the offeror provided that the “consideration” requirement is fulfilled. Similarly, under Article 8 of Turkish Code of Obligations, exhibition of goods with their prices or delivery of tariffs, price lists or etc. is considered to be an offer unless otherwise is clearly and easily understood. Therefore, under both English and Turkish law, the approach adopted in relation to public offers differs from the one set out under the CISG.

Intention to be bound in case of acceptance 

According to Article 14(1), a party’s intention to be bound in the event of acceptation, animus contrahandi, is one of the essential factors in determining whether subject matter proposal constitutes a binding offer, or not, in terms of the Convention. So much that; when a party lacks intention to be bound by its proposal which was directed to a specific person and comprised sufficient definiteness; in which case, still, there exists no binding offer due to absence of intention to conclude a binding agreement in the event of acceptation. This is because a proposal does not always aim at concluding a contract but may perhaps be aimed at taking up negotiations on a sale.

Sufficient definiteness

Comprising a “sufficient definiteness” is the last condition that a proposal is to meet in order to constitute a binding offer under the Convention as stipulated under Article 14(1). Meaning, the essential terms of the future agreement, essentialia negotii, must have been introduced in the offeror’s proposal; such that, when that respective proposal is accepted, as it is, by the offeree; it must be capable of leading to conclusion of a valid and binding agreement.

Second sentence of the aforementioned article provides a presumption on the sufficient definiteness of a proposal.  Accordingly, a proposal which indicates the goods and expressly or implicitly fixes or makes provision for determining the quantity and the price is sufficiently definite. It is accepted that the description of the goods does not have to entail a great detail. Such that, a simple indication of the goods and their amounts suffice provided that such indication is at least interpretable.However, in practice, the situation may not be as clear cut as assumed herein. In this respect, due consideration shall be given to, if any, express agreements between the parties, such as a framework agreement, trade usages or previous course of dealings between the parties when assessing whether a proposal lacks sufficient definiteness due to its failure to make reference to certain additional points which are yet to be agreed upon between the parties; such as place of delivery. In this respect, Articles 8 and 9 shall play a significant role in assessing whether parties have agreed on the essential terms of the contract.

If you would like to have more information on international trade law or Turkish commercial law, please do not hesitate to contact us at info@guzeloglu.legal

Turkish International Family Law: Accession to the Hague Convention on the International Recovery of Child Support and Other Forms of Family Maintenance (2007)

Turkish government has introduced a bill numbered 1/698 and dated 01.04.2016 concerning Turkey’s accession to the Hague Convention of 23 November 2007 on the International Recovery of Child Support and Other Forms of Family Maintenance (“Hague Convention”), signed by the Prime Minister and all ministers.

At the moment, the government bill has been referred to the Committee on Foreign Relations as primary committee.  If enacted, Turkey’s accession to the Convention will be an important step forward in the area of Turkish family law in terms of ensuring effective international recovery of child support and other forms of family maintenance

For further information on international family law in Turkey, please do not hesitate to contact me at fatmaesra@guzeloglu.legal

Turkish International Family Law: Accession to Hague Convention on Jurisdiction, Applicable Law, Recognition, Enforcement and Co-operation in Respect of Parental Responsibility and Measures for the Protection of Children

Turkish government has introduced a bill numbered 1/697 and dated 30.03.2016 concerning Turkey’s accession to the Hague Convention on Jurisdiction, Applicable Law, Recognition, Enforcement and Co-operation in Respect of Parental Responsibility and Measures for the Protection of Children of 1996 (“Hague Convention”), signed by the Prime Minister and all ministers.

At the moment, the government bill regarding the approval of the ratification of the Hague Convention is referred to the Committee on Foreign Relations as primary committee which shall go through the law making process.  If enacted, Turkey’s accession to the Convention will be an important step forward in the area of Turkish family law in terms of facilitating the protection of children in international situations, avoiding conflicts between multiple jurisdictions, applicable law and recognition and enforcement of measures for the protection of children.

For further information on  international family law in Turkey, please do not hesitate to contact me at fatmaesra@guzeloglu.legal

The CISG: Could the parties conclude a contract outside the scope of the traditional “offer and acceptance” model?

All around the word, in most simple terms, a contract is defined as a legally binding agreement. There are various ways to conclude a legally binding agreement; the most common method is the “offer and acceptance” model which is also adopted by the CISG and Turkish Contract Law.

UNIDROIT Principles of International Commercial Contracts (“PICC”) embraces the offer and acceptance mechanism along with an alternative method which takes “parties conduct” as a basis. Article 2.1.1of PICC propounds: “A contract may be concluded either by the acceptance of an offer or by conduct of the parties that is sufficient to show agreement.” Therefore the PICC, by explicitly stating that the conduct of the parties which sufficiently shows an agreement is also a way to conclude a contract, maximizes latters’ freedom to negotiate until they agree to contract on certain terms without any need to isolate a distinct offer and acceptance between the parties.

 As per the United Nations Convention on Contracts for the International Sale of Goods (“CISG”), at first sight, due to absence of an explicit provision facilitating a more flexible method for contract formation, like the one stipulated under the PICC, it may seem rather obsolescent; by neglecting other forms of reaching an agreement. In fact, it is even criticized for following the traditional treatment of a contract conclusion which is claimed to be incapable of meeting “the requirements of today’s world of business, especially when it comes to the conclusion of sales contracts covering major and technically complicated objects”.

However, it should be first stressed that the CISG defines offer as a “proposal” and not exclusively as a “statement”. Correspondingly, in the doctrine, it is asserted that under the CISG, a contract may be concluded based on the conduct of the parties where only an implicit intention exists; provided that such consensus is fit for proof. In that regard, depending on the circumstances of the case, other means, such as dispatching of the goods, may constitute such a proposal. Hence, in such circumstance where there are no clearly distinguishable and corresponding declarations, but parties mutual intention is indicated by their conduct; a contract is deemed to be concluded under CISG without any need to resort to domestic law. On the other hand, for “acceptation”, the CISG explicitly sets forth that that it can be in the form of a conduct, rather than an actual statement.

Moreover, it would be inaccurate to conclude that the CISG acknowledges only offer-acceptance model, and ostracizes all other methods of contract formation. Article 6, itself, is sufficient to refrain from such deduction as it allows parties to derogate from or vary the effect of any provision of the Convention. That said there are indeed other articles in the Convention which accommodate formation of a contract in the absence of a distinguishable offer and acceptance, without any need to invoke Article 6. As such, Article 8(3) provides that parties’ intentions are to be determined in consideration of all relevant circumstances of the case including the negotiations, any practices which the parties have established between themselves, usages and any subsequent conduct of the parties.

 Furthermore, Article 9(1), as a manifestation of part autonomy principle, also stresses that the parties are bound by any usage to which they have agreed and by any practices which they have established between themselves. Second paragraph of the said article, as a default rule, deems trade usages as applicable to contract formation provided that such usages are acknowledged and widely observed by the parties to contracts of such type involved in the particular trade concerned. Therefore, it is seen that the CISG provides indispensable flexibility that is required to facilitate formation of contract; even in circumstances where it is difficult to isolate a distinct offer and acceptance such as agreements reached in point by point negotiations or prolonged exchange of correspondence. 

In summary, Part II of the CISG has to be read and interpreted in light of the provisions set forth under the Part I in order to give them a dynamic and up-to-date effect, together with the autonomous interpretation of the Convention. 

Should you have any questions on international sales law and the CISG or the contract formation regime under Turkish law, please do not hesitate to contact me at fatmaesra@guzeloglu.legal

Modern International Trade and the Significance of the CISG

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Today, unifying of business laws on a transnational level has become an essential necessity rather than a mere objective when due regard is given to the immense growth in the international business transactions, with players spread all around the world. Just to illustrate the enormity of the increase in the volume of international dealings; one may take Turkey as an example where the statistics reveal that the volume of foreign trade has grown significantly over the last decades. Such that, the amount of foreign trade which was only around $ 137.5 Million USD in 1923 has grown into almost $ 11 Billion USD in 1980. Said number had continued to vastly escalate; adding up to around $ 35 Billion USD in 1990 and to almost $ 400 Billion USD in 2014.The numbers expose the truth: the world of business has never been as rapidly-growing and international as it is today. Hence, it was questionable, whether or not; the laws have been able to catch up with that speed and internationalism. 

Indeed in the 19th century, the present conflict of laws methods were inadequate to tackle complex issues born out of international sale of goods contracts. Additionally, large number of national systems, at that time, presented obsoleteness, incompleteness and inadequacy to address international business dealings, as they were designed to govern pre-industrial economy and not the “new emerging economy and commercial traffic based on the sale of complex manufactured industrial goods that needed to be transported to distant places, that resort to also to ancillary transactions such as financing payment arrangements, insurance, transport contracts and guarantees

When the dramatic change between the business yesterday and the business today is taken into consideration, it is clearly seen that each step taken towards achieving a unified codification on the international business law is of paramount importance in terms of providing parties a neutral, familiar and most importantly efficient legal infrastructure where they can safely carry out their transactions. In such a legal environment, business people can find the opportunity to focus on the business itself, instead of losing unnecessary amount of time trying to find an effective legal framework according to which both parties can feel confident to do business. Exactly this goal in mind, the CISG was put in action.  

Today the CISG enjoys a significant amount of recognition and success. According to the World Trade Organization (hereinafter “WTO”) statistics, the world’s top six merchandise trader countries; USA, China, Germany, Japan, France and Netherlands, are all Signatories to the CISG; together with 77 other nations including Turkey; which embodies over two thirds of international trade in goods, representing a significant economic, geographic and cultural diversity.

Overview of the Contract Formation Regime under the CISG

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It is well-worthy to examine the contract formation regime under the CISG, where a middle way between the common and civil law traditions was sought in order to achieve a system that is acceptable, efficient and suitable for the Convention’s beneficiaries, i.e. Parties to a contract which is governed by the CISG; taking into consideration the immensity, rapidity and at times complexity of international sales transactions in today’s business world.

 

The prevailing method of contract formation is the “offer and acceptance”, which is acknowledged in majority of legal systems[1] as well as in a number of prominent international legal texts, including the CISG.[2] That being said, still, contract formation is a subject which stimulates a great deal of interest for comparative law studies given that each jurisdiction has its own “flavor” when it comes to the specifics of the subject matter.

It is important to examine how the CISG was structured within itself; in order to identify where the relevant rules on the formation of contracts are located and their interaction with other provisions of the Convention. In this respect, one should first realize that the CISG comprises of four parts which respectively deal with: the scope of application of the Convention and the general provisions; rules governing the formation of contracts for the international sale of goods; substantive rights and obligations of the buyer and seller arisen from the contract; the final clauses of the Convention regulating matters such as how and when the Convention shall come into force and the rules on possible reservations and declarations. [3] As seen, the rules on formation of contracts are found under Part II of the Convention which deals with various issues in relation to the subject matter. That being said, provisions set out in other parts of the CISG also do have a significant impact on the contract formation regime stipulated under the Convention.

It goes without saying that “General Provisions” laid down in Part I, Chapter II of the Convention are highly relevant for all parts of the CISG, including the rules on the contract formation, as they are applicable throughout the Convention, as a whole. The General Provisions deal with the issues related to interpretation, trade usages and other general provisions with regards to the contractual form,[4] which are often resorted when tackling issues related to contract formation.

Other than this, Part IV of the Convention is also relevant for it allows Signatory States to make certain reservations including the possibility to opt out from Part II or Part III of the Convention under the Article 92[5]. It is interesting how this Article was introduced upon the request of the Scandinavian States in order to allow them to ratify the Convention without the Part II, who later decided to withdraw their Article 92 reservations in order to avoid confusions between merchants which would potentially put the international trade in jeopardy.[6] That being said, pursuant to the Article 94[7], Denmark, Finland, Iceland, Norway and Sweden declared that both Part II and Part III of the Convention is inapplicable where the parties have their places of business in Denmark, Finland, Iceland, Norway or Sweden due to the fact that the Scandinavian countries have their own uniform Sale of Goods Acts. However, the effectiveness of this reservation is also a subject of inquiry[8]. On the other hand, Article 96[9] has also significance over the contract formation regime as it allows States, whose legislation requires contracts of sale to be concluded in or evidenced by writing, make a reservation on the “freedom of form” principle stipulated under the Convention. However; the relevance of this reservation is diminishing as the States no longer impose written agreements on international sales contracts in their domestic laws.[10]

Finally, due regard shall be given to the fact that the Convention does not govern some of the issues that are of significance for the contract formation area such as law of agency and validity of the contract or any of its terms. It is left for domestic laws to decide whether a contract is void or voidable as a result of misrepresentation, vitiated consent, fraud, lack of or limited legal capacity, illegality or abusive terms.[11]

Should you have any questions on international sales law and the CISG or the contract formation regime under Turkish law, please do not hesitate to contact me at fatmaesra@guzeloglu.legal

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[1] PANNEBAKKER, E., “Offer and Acceptance and the Dynamics of Negotiations: Arguments for Contract Theory from Negotiation Studies”, In Erasmus Law Review, No. 2, 2013, p. 131. Retrieved on 26 August 2015 from: http://www.elevenjournals.com/tijdschrift/ELR/2013/2/ELR-D-13-00001

[2] Such as: UNIDROIT Principles of International Commercial Contracts (hereinafter “PICC” or “UNIDROIT Principles”), the Principles of European Contract Law (hereinafter “PECL“) and the Draft Common Frame of Reference (hereinafter DCFR“).

[3] Explanatory Note by the UNCITRAL Secretariat on the United Nations Convention on Contracts for the International Sale of Goods dated 1989. Retrieved on 11 October 2015 from:  http://www.cisg.law.pace.edu/cisg/text/p23.html

[4] SCHLECHTRIEM, P. & BUTLER, P., UN law on international sales the UN Convention on the International Sale of Goods, Berlin: Springer, 2008, p. 4.

[5]Article 92 of the Convention: “(1)A Contracting State may declare at the time of signature, ratification, acceptance, approval or accession that it will not be bound by Part II of this Convention or that it will not be bound by Part III of this Convention.

(2) A Contracting State which makes a declaration in accordance with the preceding paragraph in respect of Part II or Part III of this Convention is not to be considered a Contracting State within paragraph (1) of article 1 of this Convention in respect of matters governed by the Part to which the declaration applies.

[6] CISG-AC Declaration No 2, Use of Reservations under the CISG. Rapporteur: Professor Dr. Ulrich G. Schroeter, University of Mannheim, Germany. Adopted by the CISG-AC following its 18th meeting, in Beijing, China, on 21 October 2013. Retrieved on October 11, 2015 from: http://www.cisg.law.pace.edu/cisg/CISG-AC-dec2.html

[7] UNCITRAL webpage. Retrieved  on 11 October 2015 from: http://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods/1980CISG_status.html

[8]On other key respects, however, the Scandinavian CISG position has been marked by restraint. For one thing, Denmark, Finland, Norway and Sweden all chose to make Article 94 declarations (reservations) which serve to exclude inter-Scandinavian commerce from the CISG field. These declarations were based on the assumption that all four Scandinavian States would continue to have ‘the same or closely related legal rules.’ However, that assumption failed when Denmark refused to follow its northern neighbors in the adoption of a new ‘liability differentiation’ scheme for domestic sales. Now that the Scandinavian Sales Acts no longer seem ‘closely related’, it has been argued that the Article 94 declarations should all be withdrawn.” Excerpt from:

LOOKOFSKY, J., “Alive and Well in Scandinavia: CISG Part II”, In 18 Journal of Law and Commerce, 1999. Retrieved in 11 October 2015 from: http://www.cisg.law.pace.edu/cisg/biblio/lookofsky1.html

[9]Article 96 of the Convention: “A Contracting State whose legislation requires contracts of sale to be concluded in or evidenced by writing may at any time make a declaration in accordance with article 12 that any provision of article 11, article 29, or Part II of this Convention, that allows a contract of sale or its modification or termination by agreement or any offer, acceptance, or other indication of intention to be made in any form other than in writing, does not apply where any party has his place of business in that State.”

[10] CISG-AC Declaration No 2, Supra Note 24.

[11] SCHWENZER, I., & MOHS, F. (2006).

Ministry of Justice Has Published the New Communiqué on International Arbitration Fee Tariffs

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15th Edition of the Communiqué on International Arbitration Fee Tariffs has been published in the Official Gazette on 08.03.2016. Started to be published in 2001 on an annual basis, the Communique seems to reflect an identical outlook with the preceding edition.

The new Communiqué, which determines arbitrators’ fees, is applicable where:

 

  • The parties and sole arbitrator or arbitral tribunal cannot reach an agreement on the fees, or;
  • The arbitration agreement does not contain any provision regarding determination of the fee, or;
  • The parties have not made any referral to any established international guidelines or institutional rules.

 

Article 2 of the Communiqué states that arbitrators are entitled to be paid for the performance and works regarding the subject matter conducted between the dates of initiation of the arbitration until the making of the final award. However, correction, interpretation or completion of the award does not warrant an additional payment.

 

Then, Article 3 states that the fee for the president of the tribunal is to be calculated 10% more than each arbitrator’s entitlement.

 

Also, Articles 4, 5, 6 and 7 regulate the reduction and deprivation of the arbitration fee. Accordingly;

 

Arbitrators will be entitled to only one fourth of the determined fee, if;

 

  • The sole arbitrator or arbitral tribunal rules that it lacks jurisdiction, or;
  • The claimant unjustifiably does not submit its statement of claim as per the consented schedule, or;
  • The claimant’s submission of statement of claim fails to include the essential information and yet it is not completed under the given time limit by the sole arbitrator or arbitral tribunal.

 

Arbitrators will be deprived of arbitration fee, if;

 

  • The nomination of an arbitrator is not accepted by the parties due to said arbitrator’s failure to satisfy agreed specifications by the parties, or;
  • An arbitrator does unjustifiably not carry out the duties assigned to him or her, or;
  • An arbitrator who resigns or is removed from the duty by the agreement of the parties due to his or her absolute or delayed performance to complete the assigned duties.

 

If the termination of arbitration proceedings occurs before an arbitrator or arbitral tribunal determines the period of time on which the parties are to submit their evidence, half of the fee; if it occurs after such determination, full fee is conferred on the arbitrators. Additionally, the Communiqué lists the following causes for termination by referring to Article 13 of the International Arbitration Law:

 

  • If the claimant withdraws his claim, except where the arbitrator or arbitral tribunal determines that the claimant has an interest in the final solution of the dispute,
  • If the parties agree to terminate the arbitration proceedings,
  • The arbitrator or arbitral tribunal finds that the continuation of the arbitration proceedings is unnecessary or impossible for any other reason,
  • If the competent court denies the request to extend the arbitration period pursuant to subsection two of Section B of Article 10,
  • If the arbitration proceedings cannot be continued pursuant to subsection two of section B of Article 11,
  • If advance payment for expenses have not been made pursuant to subsection two of section C of Article 16.

 

After that, Article 5 of the Communiqué states that, if a withdrawal, settlement or an incident which eliminates the subject matter of the dispute concludes the dispute before the arbitrator or arbitral tribunal determines the period of time on which the parties are to submit their evidence, half of the fee; if the abovementioned concludes the dispute before such determination, full fee is conferred on arbitrators.

 

In case of a partial award, Article 6 stipulates that, the fee is to be determined on the value of the partial award. However, if the partial award is issued as being the final award, then arbitrators are entitled to the full fee.

 

Importantly, if the award is set aside in accordance with the Article 15 of the International Arbitration Law and same arbitrators are appointed, Article 7 of the Communiqué underlines that arbitrators’ will be entitled to one fourth of the fee, if the below mentioned occurs;

 

  • If the arbitrator or arbitral tribunal was not composed in accordance with the procedure agreed by the parties or foreseen in this Act, or,
  • If the arbitrator or arbitral tribunal’s decision as to its jurisdiction was against the law, or,
  • If the arbitrator or arbitral tribunal rendered an award for matters beyond the scope of the submission to arbitration or did not render an award for all of the request, or exceeded its competency, or,
  • The arbitration proceeding was not conducted in accordance with the procedure as agreed by the parties or, failing such agreement, in accordance with the provisions of the International Arbitration Law, and this had an affect on the substance of the award, or,
  • If the parties were not equally treated, or,
  • If the award is against the public order.

 

Following these, the Communiqué reiterates that the arbitrators are entitled to the fee at the end of the arbitration proceedings and that arbitrators’ fee shall be determined pursuant to the Communiqué that is in force at the time of the issuance of the award. It further provides the below Fee Chart;

 

VALUE OF THE SUBJECT MATTER FEE FOR THE SOLE ARBITRATOR FEE FOR THE ARBITRAL TRIBUNAL COMPOSED OF THREE OR MORE ARBITRATORS
For the first TRY 0.5 M 5% 8%
For the additional TRY 0.5 M 4% 7%
For the additional TRY 1 M 3% 6%
For the additional TRY 3 M 2% 4%
For the additional TRY 5 M 1% 2%
For the values over TRY 10 M 0.1% 0.2%

 

 

Should you require further information about Turkish international arbitration legislation and practice, please do not hesitate to contact Abdülkadir Güzeloğlu at abdulkadir@guzeloglu.legal or +902122881010.

A Brief Insight on Turkish Legal Practice of Organized Industrial Zones

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Irrefutably, during the last five decades, the Turkish economy has witnessed the emergence of a blooming market with an unmatched access to major commercial hubs of the world. During which time, Organized Industrial Zones (‘‘OIZs’’) in Turkey have effectively undertaken major roles to boost economic parameters of the nation.

The notion of establishing OIZs dates back to 1960s. Indeed, the industrial sector was identified as the pioneering sector at that time and the devised economic policies concentrated on realizing long-term goals within a stable economy. This climate led to establishment of the first OIZ in Bursa province in 1962 with the World Bank’s loan.

 

Principally engineered to eradicate unplanned urbanization in the industrial zones and ongoing environmental problems; with rapid development in the global markets, OIZs have become investor-friendly venues for foreign investors and local actors whereby they can benefit from a pre-installed infrastructure and public structures, i.e. water source, power plants, IT network and natural gas.

 

Imperative is to shed a light on the legal foundations that accommodates OIZs, which embodies many sectorial advantages such as industrializing appropriate regions, collectively benefiting from information technologies, increasing efficiency with regards to utilization of fuel, energy and water resources as well as combating with the unemployment.

 

Legislation on OIZs

 

After the establishment of the Bursa OIZ, OIZs have operated without any specific legislation for twenty years. In 1982, the legislature implemented the ‘Regulation on Ministry Funds for Industry and Trade’ in which significant topics were regulated for OIZs, e.g. usage of funds for OIZs, credit assignment and acquisition of land.

 

Currently, below legislation governs the operation of OIZs:

 

  • Law on Organized Industrial Zones,
  • Law on Industrial Zones,
  • Regulation on Implementation of Organized Industrial Zones,
  • Regulation on Allocating Plots Located in Organized Industrial Zones Partially or Entirely Free of Charge to Natural or Legal Persons,
  • Regulation on Site Selection for Organized Industrial Zones.

 

 

Having said that, this article will focus on the following legal matters in relation with OIZs: legal definition, types of OIZs, establishment procedure, legal status of OIZs and governance mechanisms.

 

What is an OIZ?

 

Article 3(b) of the Law on Organized Industrial Zones (Law No:4562), provides a multifaceted definition:

 

The good and service production zones, which are formed by allocating the land parcels,

 

-The borders of which are approved, for the industry in a planned manner and within the framework of certain systems by equipping such parcels with the necessary administrative, social and technical infrastructure areas as well as reparation, trade, education and health areas

 

-Along with technology development regions within the ratios specified in the zoning plans and which are operated in compliance with the provisions of this Law in order to ensure that the industry gets structured in the approved areas,

 

-To prevent unplanned industrialization and environmental problems, to guide urbanization, to utilize resources rationally, to benefit from information and informatics technologies, and to ensure that the types of industries are placed and developed within the framework of a certain plan.

 

Types of OIZs

 

After evaluating the relevant legislation and practice, it is possible to state that there exist six types of OIZs:

 

  • OIZs that are established with lending support from the Ministry of Science, Industry and Technology, (the Ministry),
  • OIZs that are established without lending support from the Ministry of Science, Industry and Technology, (the Ministry),
  • Private OIZs, established on an immovable of natural or private legal persons,
  • Mixed OIZs, comprised of corporations from numerous areas of business,
  • Specialized OIZs, comprised of corporations that operate in the same sector or in its sub-sector,
  • Reclamation OIZs, established in areas where the industrial facilities are unmethodically located in a specific place for a long time,
  • Agriculture OIZs, operated by the Ministry of Food, Agriculture and Livestock.

 

How are OIZs are established?

 

Pursuant to Article 4 of the Law No: 4562, the Ministry holds the sole authority to establish OIZs on places which are qualified as suitable pursuant to the Regulation on Site Selection for Organized Industrial Zones. Indeed, the site selection process is completed under the patronage of the Ministry and the unanimous decision of the Site Selection Committee after its on-site evaluation along with 1/25.000 scaled environmental plan. Once a decision is adopted, it is announced. However, the areas which are protected by the applicable law and on where construction of industrial structures is prohibited are excluded from the initial evaluation.

 

Once the procedure for the site selection is finalized, the authorized municipality must prepare plans for the areas surrounding the OIZ. Vitally, a wide authority is conferred on OIZs which enables them to take decisions for the sake of practicality. This liberal fashion is reflected by Article 4;

 

‘‘Local improvement and parceling plans and amendments on the boundaries of the OIZ are prepared by the OIZ as per the regulation and enacted upon resolution of the Provincial Administration Board after being presented to approval of the Ministry. The approved OIZ improvement plans are sent to the respective institutions for their information.

 

The OIZ grants and audits the licenses for the use of land; planning, construction and utilization of the buildings and facilities as well as business licenses and work permits as per the enacted improvement plan’’

 

 

Legal Status of OIZs

 

An OIZ is a legal entity under private law. The legal entity is acquired after the Ministry’s final approval on the Incorporation Protocol which is signed by the chamber of industry and commerce in the given area and pre-approved by the Governor.

 

OIZs can expropriate within the defined legal powers vested by the Ministry and in accordance with the decision on public interest given by the latter upon application of the enterprising committee of the OIZ. The expenditures incurred for acquiring the possession of the land and the obligation to pay the price rests with the OIZ legal entity.

 

Governing Actors

 

There are four organs stipulated by Law No:4562. Namely, Enterprising Committee, Board of Directors, Board of Auditors and Regional Directorate.

 

Firstly, Enterprising Committee (the Committee), being the supreme executive body, is liable and authorized to take the necessary resolutions and measures for realizing the establishment purpose of the OIZ. While accomplishing such, the Committee must fulfill its duties granted by the law, regulation, incorporation protocol and similar arrangements, realize the conditions stated in the place selection report, clear the accounts of the boards of directors and audit and utilize the financial and other resources of the OIZ in compliance with their purpose.

 

Then, Board of Directors is entrusted to manage and administer the OIZ in accordance with the laws, regulations, incorporation protocol and similar regulations, as well as resolutions of the Enterprising Committee. Following that, Board of Auditors, is responsible for auditing the expenditures and executing the budget, preparing a general auditing report once a year and an interim report at least once in every three months and to present it to the Enterprising Committee. Lastly, Regional Directorate carries the responsibility of managing the OIZ and undertaking other specified duties as per the resolutions and instructions of the Board of Directors.

 

 

Governance Methods

 

Two of the main governance methods are:

  • Co-governance of the Enterprising Committee and Tenants in the OIZ;

 

If the number of tenants, who are able to prove their commencement of operation by official channels, reaches 1/3 of the total capacity of the OIZ, tenants can appoint an authorized representative who would then be a member of Enterprising Committee.

 

  • General Assembly of Tenants

 

If the number of tenants, who are able to prove their commencement of operation by official channels, reaches 2/3 of the total capacity of the OIZ, or, if OIZ used Ministry loan and paid the latter fully, the governance of the General Assembly of Tenants can be initiated under the following two options;

 

  1. The Enterprising Committee resumes its duties where a resolution on the maintenance of latter’s duties is adopted with absolute majority in the first meeting of the General Assembly. Consequently, number of tenants taking part in Enterprising Committee reaches the absolute majority of the Enterprising Committee. This procedure is repeated in every annual General Assembly meeting.

 

  1. If a resolution on the cessation of the Enterprising Committee is reached, latter is terminated. At this General Assembly meeting, organs of the OIZ are formed in analogy with Turkish Commercial Code’s provisions on the Joint Stock Companies.

 

Main Advantages for Investors to Participate to an OIZ

 

For an investor, it is a natural goal to commence its operation in the local market once the infrastructural projects are completed. However, as one could easily anticipate, these projects could take more time than expected so that realization of the whole mission could be put in jeopardy. At this point, benefiting from the pre-installed infrastructure of roads, natural gas, IT or waste water treatment belonging to the OIZ, would definitely serve as an impetus for the foreign investor.

 

In addition to the aforesaid, tenants of OIZs who are liable for paying income and corporate tax could benefit from certain incentives under different schemes. Firstly, Law on Incentives Regarding Investment and Employment, (Law No:5804), states that incentives such as Income Tax Withholding, Employer’s Contribution, Free Investment Site Place Assignment and Energy Support are available for tenants of the OIZs which are located in specified provinces. Then; pursuant to Real Estate Tax Law, buildings in the OIZs are exempt from real estate tax for the following 5 years after the completion of their construction. Moreover, parcels and deliveries of work-place of economic entities formed for the establishment OIZs are exempt from VAT pursuant to Value Added Tax Law.

 

Conclusion

 

In conclusion, with its core legal concepts aimed to achieve a well-functioning mechanism as well as many advantages when entering the Turkish industry, OIZs assumes a crucial role for sustainable development of Turkish business and offers an appealing setting for the investors in order to commence their business efficiently. Should you need further advice on legal framework of Organized Industrial Zones and Turkish Commercial Code along with foreign investment regime, contact us at abdulkadir@guzeloglu.legal

Salih Dursun’un Kırmızı Kartı: Gerçekten Yeni Bir Sayfa mı?

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Ülkemizde sporun, özellikle de futbolun ne kadar ilgi gördüğünün ve oluşturduğu kamuoyunun ülke gündemine etkisinin göz ardı edilecek zayıflıkta olmadığını çeşitli gelişmelerle tecrübe etmek hiç de zor bir uğraş değildir. Bunun son ve belki de şu ana dek en olağandışı örneği; Spor Toto Süper Lig’in 22.haftasında oynanan ve Galatasaray’ın galibiyeti ile sonuçlanan müsabakada Trabzonspor oyuncusu Salih Dursun’un hakem Deniz Ateş Bitnel’e, hakemin verdiği penaltı kararından sonra elinden aldığı kırmızı kartı göstermesi olayında yaşanmıştır. 

Gerçekten de oyuncunun bu davranışı bir anda ülke gündemine oturmuş ve ulusal ve uluslararası toplumun birçok kesiminde çeşitli tepkileri beraberinde getirmiştir. Bunların arasında dikkat çekenleri; Bursaspor Kulübü’nün oyuncuyu Anadolu’nun sembolü ve kendilerinin evladı olarak ilan etmesi, Cumhuriyet Halk Partisi Trabzon milletvekili Haluk Pekşen’in futbolcunun davranışının salt hakeme değil Türkiye’deki spor federasyonlarına yöneldiğini belirtmesi, Adalet ve Kalkınma Partisi Trabzon milletvekillerinin ise Türk futbolunun ‘temizlenmesi’ gerektiğinin altını çizmeleri, Yomra ilçesi Belediye Meclisi’nin Salih Dursun’un adını bir caddeye vermesi, Maçka ilçesinde bir parka oyuncunun heykelinin yapılacağının ilçe  belediyesi tarafından açıklanması, Trabzonspor Kulübü Başkanı Muharrem Usta’nın oyuncunun hareketini ‘değişimin sembolü’ olarak nitelendirmesi ve nihayet Kulüpler Birliği Vakfı Başkanı Göksel Gümüşdağ’ın sunduğu birtakım öneriler olarak uzun bir listede vermek mümkündür. Konuyla ilgili ‘7 kişiye karşı 12 kişi oynamak adaletsizlikti, kırmızı kartı 11 kişi kalmaları için çıkardım’ şeklinde bir açıklama yapan Salih Dursun ise Profesyonel Futbol Disiplin Kurulu tarafından 3 maç ceza ve 13 bin Türk Lirası cezaya çarptırıldı.

Fakat, yapılan açıklamalar arasında en önemlisi Türkiye Futbol Federasyonu (‘TFF’) Başkanı Yıldırım Demirören’e aittir. ‘Merkez Hakem Kurulu’nun Genel Kurul’un özgür iradesiyle ve üyelerin oylarıyla seçilmesinin hakem ataması ve uygulamalarıyla ilgili gereksiz soru işaretlerini ortadan kaldıracağını düşünüyoruz. Yani artık kurulları Federasyon atamayacak. Futbol ailesinin üyeleri seçecek… Üstelik bu sistem sadece Merkez Hakem Kurulu ile sınırlı kalmayıp Profesyonel Futbol Disiplin Kurulu ve Tahkim Kurulları için de uygulanmaya müsaittir….’ ifadelerini kullanan Başkan Demirören’in verdiği  bilgilerin yüksek bir önemi haiz olduğu anlaşılmaktadır. Öyle ki sınırsız sayıda paydaşa sahip futbol endüstrisinin, gelişen bir pazar olan Türkiye’de, yargısal faaliyette bulunan Court of Arbitraton for Sports gibi söz sahibi makamların dahi müdahale etmekten kaçındığı ve doktrindeki baskın görüşe göre salt oyun kurallarını temsil eden kurallar bütünü olan lex  ludica’nın Türk futbolunda hakemler vasıtasıyla uygulanmasına Federasyon üyelerinin katkısının daha belirleyici olacağının altı çizilmektedir. 

Öneriye ilişkin düşüncelerimizin ilk kısmını yansıtmadan önce, Merkez Hakem Kurulu (‘MHK’) hakkında geçerli olan ilgili düzenlemeleri yansıtmakta fayda vardır. TFF Statüsü Madde 42 aşağıdaki gibidir;

‘‘ 1. TFF’deki yan kurullar şunlardır:

a) Merkez Hakem Kurulu,

(…)

2. Yönetim Kurulu, işbu Statü’de aksine hüküm bulunmadığı müddetçe tüm yan kurulların üye sayısını, çalışma usul ve esaslarını kurulun göreceği hizmetin nitelik ve özelliklerini göz önünde bulundurarak belirler.

3. Her bir yan kurul başkanı kendi kurulunu temsil eder. Yan kurullar Yönetim Kurulu tarafından hazırlanan ilgili talimatlar doğrultusunda çalışırlar.

4. Her bir yan kurul başkanı toplantı tarihlerinin belirlenmesi, konularıyla ilgili görevlerin yapılması ve bunların Yönetim Kuruluna rapor edilmesini Genel Sekreter vasıtasıyla yapar.

5. Bu kurulların görüş, öneri ve raporları istişari nitelikte olup, mahiyetine göre Federasyon Başkanı veya Yönetim Kurulunca onanmadıkça uygulanamaz.

6. Her bir yan kurul, Yönetim Kuruluna konularıyla ilgili talimatlarda değişiklik teklifinde bulunabilir.

7. Yan kurulların görev süresi, Yönetim Kurulu’nun görev süresi ile sınırlıdır.’’

Madde 43 ise tamamen MHK’ya adanmıştır;

  1. ” 1. Merkez Hakem Kurulu bir başkan ile sekiz (8) üyeden oluşur. 
  1. 2. (…) 
  1. 3. Kurul görevinde bağımsızdır. Üyeler istifa etmedikçe veya çekilmiş sayılmadıkça yerlerine yenisi atanamaz. 
  1. 4. Merkez Hakem Kurulu, TFF yetkisi dâhilinde üye kulüpler arasında oynanacak her türlü resmi veya özel müsabakaya hakem ve gözlemci atamak … ”

Statünün 87.maddesinin 2.fıkrası da MHK’nın görev süresine tekrar vurgu yaparken, MHK üyelerinin atanmaları gereken süre zarfını belirlemiştir: ‘‘Merkez Hakem Kurulu, Temsilciler Kurulu ve bu Statü gereğince kurulmasına karar verilen diğer kurullar, işbu Statünün yürürlüğe girmesinden en geç kırk beş (45) gün içinde TFF Yönetim Kurulu tarafından atanır. Bu kurulların süresi TFF Yönetim Kurulu’nun görev süresi ile sınırlıdır.’’

MHK talimatının seçilmiş maddelerine bakıldığında, MHK’nın ve organlarının lex ludica uygulaması anlamında temel makam olduğunu yansıtan aşağıdaki resim ortaya çıkmaktadır.

‘‘MADDE 3 – MHK’NIN YAPILANMASI

a) MHK, TFF Başkanı’nın teklifi ve Yönetim Kurulu’nun onayı ile atanan bir başkan ile sekiz (8) üyeden oluşur.

b) (…)

MADDE 4- MHK’NIN ÇALIŞMA İLKELERİ

b) Kararlar salt çoğunluk ile alınır. Oyların eşitliği halinde MHK Başkanı’nın oyu iki oy sayılır. BHK başkanları, kendi bölgeleriyle ilgili dosyalarda, oy veremezler.

MADDE 5- MHK’NİN GÖREV VE YETKİLERİ

  1. a) FIFA, UEFA veya TFF tarafından organize edilen veya izin verilen her türlü futbol, futsal, plaj futbolu ve HiF müsabakaları için ilgili statü ve talimatlar uyarınca gerekli hakem, yardımcı hakem, gerektiğinde dördüncü hakem ile ilave yardımcı hakemleri, gözlemci ve mentörleri doğrudan veya ilgili kurullar aracılığıyla atamak,

(…) 

MADDE 8 – PROFESYONEL MÜSABAKA İCRA KURULU ( PMİK ) 

  1. a) Profesyonel lig, Türkiye Kupası ve Süper Kupa müsabakalarına hakem, gözlemci ve mentör atamalarını yapmak üzere, MHK Başkanı ve iki üyeden oluşturulur.
  2. b) PMİK üyeleri, MHK Başkanı’nın teklifi ve Yönetim Kurulu’nun onayı ile atanır. MHK Başkanı, bu kurulun doğal başkanıdır. 

(…)’’

Bu liste; kulüplerin futbol hakemlerinin maç yönetimlerinden yakınmaları ve öne çıkan aktörlerin hakemleri başka kulüplerin veya kişilerin çıkarlarını korumakla itham etmeleri gibi Türk futbolunun kronik sayılabilecek problemlerinin, Federasyon Başkanı’nın işaret ettiği hukuki zeminini oluşturmaktadır. Fakat, düşünüldüğünde, Genel Kurul’un, MHK ile ilgili halihazırdaki düzenin değiştirilmediği varsayımında, sayısı yaklaşık 300’e yaklaşan delegesi vasıtasıyla, MHK Başkanı ve kurulun 8 üyesini ‘kronik problemleri’ ortadan kaldıracak biçimde etkin olarak seçmesinin kolaylıkla gerçekleşeceğini söylemek pek kolay değildir. Nitekim ulusal ve gerektiği zaman uluslararası görevleri yerine getirmekle mükellef, faal hakemliği atama tarihinden en az bir yıl veya öncesinde bırakmış olan futbol hakemleri arasından atanacak üyelerle müteşekkil bu kurulu, tüm delegeleri kucaklayıcı bir biçimde oluşturmak TFF Statüsünde belirtilen sürede mümkün olmayabilir. Dolayısıyla, Demirören’in bahsettiği düzenlemeleri hayata geçirmeden önce, güncel metinler kaynaklı gerçekleşmesi muhtemel tıkanmaların önüne geçmek için; 

  • MHK’nın üye sayısının artırılması, 
  • Üyelerin göreve geldiklerinde beyan edecekleri ve görevlerini yerine getirirken bağımsız oldukları teyit eden bir beyannameyi akıllarda kuşku bırakmayacak berraklıkta detaylıca oluşturmaları, 
  • Profesyonel Müsabaka İcra Kurulu üyeleri, —ki MHK Başkanı bu kurulun doğal başkanıdır,  için şart koşulduğu üzere hizmet sözleşmesi ve benzeri TFF’ye bağımlı bir ilişki ihdas eden düzenlemelerin kaldırılması,
  • Kulüpler Birliği Vakfı Başkanı Gümüşdağ’ın da belirttiği üzere hakemlerin performans değerlendirmelerinin profesyonel denetim kuruluşlarınca da akredite edilmesi ve tutarsızlıkların incelenmesi,
  • MHK’nin kendi başkanını üyeleri arasından kendi seçmesi,
  • MHK’nin görev süresinin TFF Yönetim Kurulu’nun süresi ile sınırlı olmaması,
  • PMİK üyesi veya değil, hiçbir MHK ve PMİK üyesine huzur hakkı ödenmemesi,
  • Hakem olmayan ve MHK’ya atanabilecek 3 ‘spor insanı’nın  yerine, hakemlik mesleğini şartları taşımak suretiyle bırakmış 3 kişinin atanması,

daha da çeşitlendirilebilecek öneriler sunulabilir. 

Tüm bunlar bir yana, Başkan Demirören’in MHK için öngörülen sistemin Tahkim Kurulu için de uygulanabileceğinden bahsetmesi, tahkim hukukuna ve spor tahkim yargılamasına hakim olan ilkeler çerçevesinde bir an önce değerlendirilmelidir. Bu aslında bir değerlendirmeden öte bir görev niteliğini taşımaktadır zira ülkemizde var olan spor yargısı algısını uluslararası standartlara bir an önce biraz daha yakınlaştırmak gerekmektedir. 

Belirtmek gerekir ki Türkiye, bilinen hukuk sistemleri arasında, Anayasasının 59.maddesinin 3.fıkrası vasıtasıyla, sportif uyuşmazlıklar için tahkimi zorunlu kılan nadir ülkelerden bir tanesidir. Bu durumun ortaya çıkardığı görüntünün değerlendirilmesi bir yana,  TFF Statüsü ve Tahkim Kurulu Talimatı çerçevesinde, Demirören tarafından önerilen düzenlemelerin verimli şekilde uygulanması için aşağıdaki değişiklerin yapılması teklif edilmelidir:

  • Hem Statü hem de Talimat için ortak olan, Tahkim Kurulu’nun görev süresini Federasyon Yönetim Kurulu’nun görev süresinin geleceğine bağlayan hüküm ortadan kaldırılmalı ve Genel Kurul’un kararlaştıracağı bir görev süresini belirten ortak bir düzenleme oluşturulmalıdır.
  • Gerekçeli kararın, dakikaların önem arz ettiği spor yargılamasında, 3 ay gibi uzun bir süre yerine, 2 haftalık bir zaman zarfında üretilmesi daha makul olabilecektir.
  • Tahkim Kurulu üyelerinin Talimat uyarınca huzur hakkı almalarını düzenleyen hüküm kaldırılmalı ve Federasyon ile tam anlamıyla bağımsız bir yargısal faaliyet üstlenmesi gereken Kurul üyelerinin mali bağı ortadan kaldırılmalıdır. Gerçekten de bu anlayış dünyada hem kurumsal hem de ad-hoc tahkim kuralları tarafından kabul edilen, tahkim yargılamasının olmazsa olmaz kaidelerinden biridir.
  • Tarafsızlık kuralı ile eşdeğer önemi haiz olan bağımsızlık kurumunun da Tahkim Kurulu bünyesinde yaşatılması gerekmekte ve bunun önündeki engeller ortadan kaldırılmalıdır. Öyle ki Kurul’un atanmasında Federasyon Başkanı ve Yönetim Kurulu’nun rolleri ortadan kaldırılmalıdır. Bunun yerine Demirören’in önerisinden biraz farklı olarak, Genel Kurul delegelerinin aktif olarak Türk futbolunda yer alan tüzel ve özel kişiliği haiz, muhtemel bir yargılamanın tarafı olacak paydaşların, tahkim yargılaması usulünde taraflara tanınan serbestinin çizgisinde, Kurul üyelerini kendilerinin seçmeleri daha verimli olabilecektir. Tabii ki, bu önerinin gerçekçi olması için, sayısı bir hayli olan aktif delegelerin sayısı hatırlanarak, tahkim kurulu üyelerinin sayısının tek sayı olarak muhafaza edilerek makul biçimde artırılması düşünülebilir. Önemle altı çizilmesi gereken konu, bu üyelerden beklenen, salt tarafından seçildikleri delegelerin haklarının yılmaz koruyucusu olmamaları, aksine yargılamanın usul ve esaslarına uygulanacak hukuk kurallarını hakkıyla yerine getirerek adalet dağıtmalarıdır.
  • Ayrıca Tahkim Kurulu üyelerinin seçildikleri andan itibaren, milletlerarası tahkime benzer bir şekilde olmak üzere, bağımsızlık ve tarafsızlıklarını teyit eden, yargılamaya muhatap olacak potansiyel taraflarla ilgili, detaylıca bir beyanat vermeleri, bu beyanatı görev süresince güncellemeleri gerekliliği düzenlenmelidir. Kurul üyelerinin bağımsızlık ve tarafsızlıklarını korumaları açısından beyanatlarını açıklayıcı şekilde belirtmelerinin gelenekselleşen kaygıların ortadan kaldırılmasında büyük etkisi olacağı öngörülebilir.

Tabii ki Türk futbolunda oyun kurallarının doğru uygulanması ve yargısal faaliyetlerin yerine getirilmesi hakkındaki öneriler kısa bir yazıya sığdırılamaz. Sürdürülebilir bir gelecek için hukuki düzenlemelerin çok sesli bir ortamda dile getirilip oluşturulması, bundan sonra da güncel tutularak beslenmesi gerekmektedir. 

     

In a House of Mirrors: Reflections of Public Policy When Enforcing Foreign Judgments in Turkey

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Today, it is almost impossible to find a concept that is unable to depict a clear perspective, but plays a crucial role during interaction of different jurisdictions other than the public policy. Strikingly, while a consented definition on international and even local platforms is ever absent, importance of public policy can be observed in myriad areas of law.

However, one could identify some of the eloquent attempts to describe public policy. For instance, latter is often denoted as values, principles and responsibilities within social, moral, commercial themes that a State attaches its protective power. Moreover, violation of public policy signifies the consequences to which the core values of fairness, justice and public morals of a society would strongly object. In another inclusive remark, public policy  consists of rules that has gained legitimacy over the time throughout collective subconscious of a nation by safeguarding fundamental interests of it.

Having explained that, in this brief summary, selected dimensions of public policy pursuant to Turkish International Private and Procedural Law (‘IPPL’) and practices of the Supreme Court (‘Yargıtay’) will be brought under the spotlight.

According to Article 54 of the IPPL, among other conditions, the competent court shall rule on the enforcement provided that the decree of the foreign court is not plainly contrary to Turkish public policy. While inspecting the foreign judgment, an extensive discretion is conferred on the judge.

The ex-officio duty of the competent court to determine conditions for enforcement cannot be extended as constituting a substantial review of the foreign judgment. Article 54 orders the judge to only take ‘conclusion section’ of the foreign judgment into account and bars him from examining and verifying methodology of the foreign court’s application of its own legislation.

At this junction, the question as to whether or not a foreign judgment which lacks a reasoning section plainly violates Turkish public policy has occupied the agenda of the numerous chambers of the Supreme Court for more than a decade. In its groundbreaking decision of 2012, General Assembly for the Unification of Judgments of Yargıtay has concluded the debate. 

Relevant and illuminating parts of the decision follows:

‘‘Public policy, by its nature, is a changing concept, which adapts itself to time, place and the subject matter. Despite explanations provided by scholars and court decisions, it does not have a definition even within long-established jurisdictions. Nevertheless, this legal concept, whose scope is a burdensome task to determine, may be described as the rules which protect fundamental values and structure of the society… The area that public policy intervenes is vast and can be expanded by interpretation… Indeed, the consequences of recognizing and enforcing foreign judgments in Turkey must be evaluated by determining their compliance with the Turkish public policy as oppose to evaluating substantive law and its application procedure by the foreign court… It is evident that reasoning is in strong relation with public policy. Reasoning of a court decision not only rationalizes the judgment in democratic constitutional states, but also scrutinizes efficiency of the judge with its sense of reality. Reasoning is binding… Reasoning must be inclusive and reflect a pluralist outlook… Approaches of Private International Law and Civil Procedure Law are different from each other… One of the conditions that is required for enforcement of the foreign court decisions is related with the Turkish public policy. Pursuant to Article 54.c of the Law No:5718, in order for a foreign court decision to be enforced, it must not carry a provision that violates Turkish public policy. Here, violation of Turkish public policy is possible only if the conclusion section or one of its provisions plainly breaches Turkish public policy. Therefore, reasoning of a foreign judgment does not have any power to affect the enforcement procedure… To comply with Turkish public policy, the presence of a reasoning, in the context of the Turkish Procedural Law is not necessary in a foreign judgment… Therefore, a foreign judgment cannot be considered in plain violation with Turkish public policy only because it does not bear its reasoning.’ 


Despite the reform-minded and progressive approach depicted above, it must be mentioned that practice of the Supreme Court still consists of certain restrictions and conservative manner. For instance, particular matters of family law, including guardianship and adoption, severance pay, along with change of name conflicts are by default considered in strict relation with the Turkish public policy.

Ultimately, public policy is an immeasurably important actor in private international law which has a big potential to determine the outcome of an enforcement procedure in a jurisdiction and ability to possess disguise itself under different areas of law. For more information on precedents of Turkish courts regarding public policy, please do not hesitate to contact us.