Clarifications to Turkey’s International Arbitration Law (Law No 7101)

Turkiye

Introduction

Law No 7101 on Amendments to the Enforcement and Bankruptcy Law and Other Laws (“Law No 7101”), published in the Official Gazette dated 15 March 2018, amended various laws with the aim of securing creditors and expediting legal proceedings. One of these amendments by Law No 7101 is the clarification of the international arbitration rules, among other laws.

Background

Due to some inconsistencies between the provisions of Civil Procedure Law No 6100 regarding arbitration and appeal procedures and the International Arbitration Law No 4686, the rules on jurisdiction and appeal in the setting aside of arbitral awards were contentious matters before Turkish courts.

New Rules of Procedure

Law No 7101 makes the following amendments in terms of international arbitration law:

  • Lawsuits to set aside an international arbitral award rendered in Turkey shall be directly filed before the respective district appellate court. Before the amendment, there were discussions regarding whether setting aside commercial arbitration cases were to be referred to civil courts of first instance or commercial courts.
  • Any judgment to set aside international arbitral awards rendered in Turkey or the refusal thereof may be appealed before the Court of Appeal.
  • Any other duties conferred to the civil courts of first instance in case of international arbitral awards shall be subject to the jurisdiction of either civil courts of first instance or commercial courts, depending on the nature of the dispute.

Conclusion

The clarifications to Turkey’s international arbitration law increases legal foreseeability by clarifying rules of procedure. These amendments are also in line with the Turkish government’s promotion of the Istanbul Arbitration Centre (ISTAC).