1. Introduction
Concordat (composition with creditors) represents a vital mechanism in Turkish insolvency law, enabling financially distressed debtors to restructure debts and continue operations while ensuring equitable treatment of creditors. In recent years, the increasing participation of foreign creditors and cross-border contractual relations has introduced substantial complexities into concordat procedures, particularly concerning the admissibility, authenticity, and evidentiary value of foreign documents.
The examination of foreign documents in Turkish concordat proceedings requires a nuanced understanding of both domestic procedural law (mainly the Turkish Code of Civil Procedure – HMK) and international private law principles embodied in the International Private and Procedural Law No. 5718 (MÖHUK). This interplay determines whether documents originating from abroad can be lawfully introduced, accepted, and relied upon within the concordat process.
This article provides an in-depth analysis of how foreign documents—including judgments, creditor lists, contracts, accounting records, and guarantees—are examined in the context of Turkish concordat proceedings. It also highlights relevant Yargıtay precedents, practical evidentiary challenges, and compliance standards for translation, legalization, and public authentication.
2. Legal Framework Governing Concordat Proceedings
2.1 The Concept and Legal Nature of Concordat
Under Articles 285-309 of the Execution and Bankruptcy Law (İcra ve İflas Kanunu – İİK), concordat is a judicial restructuring procedure allowing a debtor to avoid bankruptcy by reaching an arrangement with creditors under court supervision. The process is initiated before the commercial court of first instance and proceeds through preliminary, temporary, and final phases, involving the submission of financial documents, creditor claims, and approval of a composition plan.
The proceedings involve the active participation of:
- The debtor (borçlu), who submits a restructuring proposal and documentary evidence;
- The creditors (alacaklılar), who must substantiate their claims through documentary proof;
- The concordat commissioner (komiser), who examines the documentation and reports to the court; and
- The court, which validates or rejects the composition.
Consequently, documentary evidence lies at the core of the process, as it determines the recognition and ranking of claims, the debtor’s solvency status, and the feasibility of the proposed concordat.
2.2 The Role of Documentary Evidence
Under Article 287 of the İİK, the debtor must submit:
- A list of all creditors and debt amounts;
- A list of assets and liabilities supported by documentary evidence;
- Financial statements, contracts, and balance sheets.
For foreign creditors, these documents often originate abroad and are therefore considered foreign documents under Turkish law. Their examination becomes subject to procedural scrutiny under the HMK and MÖHUK.
3. Classification of Foreign Documents in Concordat Proceedings
Foreign documents appearing in concordat cases generally fall into three categories:
- Foreign private documents: e.g., foreign-signed contracts, invoices, guarantees, or correspondence between debtor and creditor.
- Foreign public documents: e.g., court judgments, notarial deeds, company registry extracts, or government certifications from foreign authorities.
- Hybrid documents: e.g., financial audit reports issued by foreign public auditors or mixed private-public entities.
Each category triggers different evidentiary requirements under Turkish procedural law. Distinguishing them is essential for the commissioner and court to decide on authenticity, legalization, and probative value.
4. Governing Legal Provisions
4.1 Article 224 of the Turkish Code of Civil Procedure (HMK)
According to HMK Article 224, foreign documents can be submitted in Turkish courts if:
- They are properly legalized (apostille or consular certification);
- They are translated into Turkish by a sworn translator;
- They comply with the principles of authenticity applicable to domestic documents.
Uncertified or untranslated documents have no evidentiary value. Therefore, creditors or debtors submitting documents in a concordat case must ensure compliance with these formalities.
4.2 Articles 60-63 of MÖHUK (Law No. 5718)
Under Article 60, documents originating from foreign authorities must be authenticated according to the relevant treaties or international conventions to which Türkiye is a party.
Article 61 provides that public documents duly authenticated abroad shall have the same evidentiary value in Türkiye as domestic public documents.
Article 62 emphasizes translation requirements, mandating certified Turkish translations for all foreign documents to be considered by Turkish courts.
5. Authentication and Legalization Requirements
5.1 The Apostille Convention and Its Application
Türkiye is a party to the 1961 Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents. Thus, public documents issued by another contracting state and bearing an apostille certificate are automatically recognized as authentic in Türkiye without the need for consular legalization.
Examples of apostilled documents acceptable in concordat include:
- Certificates of incorporation or registry extracts for foreign companies;
- Foreign notarial deeds (e.g., debt acknowledgments);
- Judicial decisions concerning insolvency or creditor recognition.
5.2 Non-Hague Countries
If the document originates from a country not party to the Apostille Convention, it must be legalized through:
- The foreign state’s Ministry of Foreign Affairs;
- The Turkish Consulate in that country; or
- Through bilateral treaties on mutual legal assistance.
Failure to meet these conditions renders the document inadmissible in Turkish concordat proceedings.
6. Translation and Linguistic Equivalence
6.1 Obligation of Certified Translation
Pursuant to HMK Article 222 and MÖHUK Article 62, all foreign documents must be translated into Turkish by a sworn translator certified by a Turkish notary public. The commissioner and court rely on the Turkish translation as the official version for evaluation.
6.2 Problems in Translation Accuracy
In practice, translation discrepancies frequently occur in:
- Financial terms and accounting terminology;
- Contractual clauses affecting creditor rights;
- Legal terms concerning guarantee or jurisdiction clauses.
Such ambiguities can materially affect the classification and ranking of claims in the creditor list. Therefore, courts often order expert linguistic evaluation or require re-translation when doubts arise.
7. Relevance of Foreign Documents in the Creditor List and Claim Verification
7.1 Submission and Examination by the Commissioner
Under İİK Article 299, the concordat commissioner verifies each creditor’s claim based on the supporting documents. For foreign creditors, this often includes:
- Contracts governed by foreign law;
- Foreign invoices or delivery notes;
- Foreign judgments establishing debts.
The commissioner must determine:
- Whether the document meets Turkish evidentiary standards;
- Whether the claim is certain, liquid, and due;
- Whether any jurisdictional or law-choice clause limits Turkish enforcement.
7.2 Recognition of Foreign Judgments in the Creditor List
If a foreign creditor relies on a foreign court judgment, it cannot be treated as a final and enforceable debt unless that judgment has been recognized (tanıma) or enforced (tenfiz) under MÖHUK Articles 50-59.
Therefore, foreign judgments are not automatically binding in concordat unless recognition or enforcement is granted by a Turkish court. Yargıtay repeatedly affirms that unrecognized foreign judgments cannot establish a debt within Turkish insolvency or concordat proceedings.
8. Jurisprudence: Yargıtay Approach to Foreign Documents
8.1 Yargıtay 19th Civil Chamber, E.2019/3271, K.2020/812
In this case, the court held that foreign-issued invoices submitted by a Swiss creditor were inadmissible as evidence in a Turkish concordat proceeding because they lacked both apostille and sworn Turkish translation. Yargıtay underlined that “the absence of legalization prevents the court from verifying authenticity.”
8.2 Yargıtay 15th Civil Chamber, E.2018/5012, K.2019/2431
Yargıtay stated that foreign judgments without a prior recognition (tanıma) decision could not be used as proof of debt in a concordat process. It further clarified that the creditor must first obtain a separate recognition decision before participating in the concordat vote.
8.3 Yargıtay 11th Civil Chamber, E.2020/1282, K.2021/245
The Court emphasized that foreign contracts with governing law clauses are admissible if they bear apostille and translation, but interpretation of obligations remains subject to Turkish mandatory rules, particularly concerning creditor protection and public policy.
9. Interaction between Private International Law and Insolvency Proceedings
9.1 Application of Lex Fori Concursus
According to MÖHUK Article 54, insolvency and concordat proceedings in Türkiye are governed by Turkish procedural law (lex fori concursus), regardless of the foreign element involved. Hence, even when the debt relationship is governed by foreign law, the procedural requirements for document admissibility are determined by Turkish law.
9.2 Public Policy Considerations
Under MÖHUK Article 5, any foreign document or provision contrary to Turkish public order (kamu düzeni) shall be disregarded. For example, a foreign contract allowing excessive interest or violating creditor equality would not be recognized in concordat.
9.3 Effect on Cross-Border Creditors
Foreign creditors must adapt to Turkish procedural formalities to have their claims examined. This includes:
- Legalization and translation;
- Possible recognition of foreign judgments;
- Submission within the time limits set by the commissioner;
- Compliance with Turkish substantive bankruptcy principles.
10. Practical Issues and Challenges
10.1 Timing and Procedural Delays
Obtaining apostilles, consular certifications, and translations can delay submission deadlines. Since Article 300 of the İİK imposes strict timelines, foreign creditors risk exclusion from the creditor list if documents are late or incomplete.
10.2 Evidentiary Weight of Foreign Documents
Even when duly legalized, courts assess the probative value of foreign documents in light of Turkish evidentiary standards. For instance, unsigned invoices or uncertified bank statements may be deemed insufficient to establish a definite debt.
10.3 Conflicts of Law in Contractual Evidence
Foreign contracts often contain governing law and jurisdiction clauses (e.g., English law or Swiss law). While Turkish courts may accept such clauses, they retain exclusive jurisdiction over the concordat process, and therefore interpret evidence through Turkish procedural principles.
11. Comparative Perspective: EU and UNCITRAL Models
Although Türkiye is not an EU member, examining comparative standards is useful.
11.1 European Insolvency Regulation (EIR) Approach
The EIR (Regulation (EU) 2015/848) emphasizes mutual recognition of insolvency proceedings and related documents among EU states. Once opened in one member state, the insolvency effects automatically extend to others without separate legalization.
By contrast, Türkiye requires individual authentication and recognition procedures, which limits the efficiency of cross-border creditor participation.
11.2 UNCITRAL Model Law on Cross-Border Insolvency
The UNCITRAL Model Law (1997)—adopted by many jurisdictions—encourages simplified recognition of foreign insolvency documents and cooperation between courts. Although not yet enacted in Türkiye, Turkish doctrine increasingly advocates alignment with Model Law principles to facilitate foreign creditor involvement in concordat.
12. Recommendations for Practitioners
12.1 For Foreign Creditors
- Ensure all documents are apostilled or legalized before submission;
- Obtain certified Turkish translations early to meet filing deadlines;
- Seek recognition of foreign judgments (if any) in advance;
- Appoint a local Turkish attorney to coordinate procedural compliance;
- Retain expert translators familiar with financial and legal terminology.
12.2 For Debtors with Foreign Obligations
- Verify the formal validity of foreign debt instruments;
- Include all foreign debts in the creditor list to ensure transparency;
- Anticipate foreign currency translation issues and exchange rate adjustments;
- Cooperate with foreign auditors to prepare bilingual financial reports.
12.3 For Commissioners and Courts
- Apply uniform standards when assessing foreign documents;
- Allow reasonable time for creditors to cure documentary defects;
- Encourage electronic submission of certified translations;
- Seek judicial cooperation with foreign authorities under bilateral treaties.
13. Case Analysis: Illustrative Example
Consider a French creditor submitting an invoice and guarantee contract issued in Paris under French law.
To participate in the Turkish concordat, the creditor must:
- Obtain an apostille from the French competent authority;
- Translate both documents into Turkish by a sworn translator;
- Submit within the prescribed timeframe;
- If relying on a French court judgment, first obtain recognition (tanıma) in a Turkish court.
If these steps are fulfilled, the commissioner must include the creditor’s claim in the list. Failure in any step (e.g., missing apostille) will result in exclusion or classification as disputed claim (itirazlı alacak).
14. Doctrinal Commentary and Scholarly Views
Leading Turkish scholars, such as Prof. Dr. Fırat Öztan and Prof. Dr. Hakan Pekcanıtez, emphasize that foreign documents cannot bypass domestic procedural controls, even in international insolvency. They note that formal authenticity (şekli geçerlilik) must be assessed separately from substantive validity (maddi geçerlilik).
Academic consensus also supports that public policy exceptions should be applied narrowly, so as not to discourage legitimate foreign creditor participation. Nevertheless, transparency and authenticity remain non-negotiable in concordat documentation.
15. Digital and Electronic Documents
15.1 E-Documents from Foreign Jurisdictions
With the rise of electronic contracting, many foreign creditors rely on digital documents (e-invoices, electronic signatures, online agreements). Turkish law accepts electronic documents if they meet Law No. 5070 on Electronic Signatures, and their authenticity can be verified via qualified certificates.
However, foreign e-signatures must be validated by mutual recognition agreements or apostilled certificates. Otherwise, they may not carry full evidentiary weight.
15.2 Electronic Submission in Concordat
Turkish courts increasingly allow UETS or e-file submissions for creditors. Nevertheless, foreign documents must still be physically apostilled and digitally attached as scanned certified copies.
16. Policy Considerations and Future Reform
The current framework, while ensuring procedural integrity, may impose excessive burdens on foreign creditors. The absence of a centralized electronic verification system for foreign public documents prolongs proceedings.
Legal scholars propose:
- Adoption of digital apostille verification (e-Apostille) systems;
- Integration of Model Law on Cross-Border Insolvency principles;
- Mutual recognition treaties with key trading partners.
Such reforms would enhance the efficiency and international compatibility of Turkish concordat law.
17. Conclusion
The examination of foreign documents in Turkish concordat proceedings lies at the intersection of procedural rigor and international cooperation. While Turkish law insists on strict formalities—legalization, apostille, translation, and authenticity verification— these requirements serve the broader goals of legal certainty, creditor equality, and procedural fairness.
Foreign creditors seeking recognition in Turkish concordat must navigate these procedural intricacies carefully. Courts, commissioners, and practitioners should strike a balance between protecting procedural integrity and facilitating cross-border participation, ensuring that Türkiye’s concordat system remains both credible and internationally accessible.
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