Why International Companies Choose Arbitration in Turkey: Legal Advantages, ISTAC Proceedings and Enforcement

Introduction

Türkiye occupies a commercially significant position between Europe, Asia, the Middle East, the Caucasus and the Mediterranean. International companies operating in construction, energy, manufacturing, technology, transportation, logistics, finance, tourism, international trade and corporate investment frequently enter into contracts connected with Türkiye.

When drafting these contracts, one of the most important questions is how future disputes will be resolved. The parties may choose Turkish courts, foreign courts, mediation, expert determination or arbitration. For many cross-border transactions, arbitration is preferred because it offers neutrality, procedural flexibility, specialist decision-makers and the possibility of international enforcement.

International companies may select Türkiye as the legal seat of arbitration, agree to arbitration administered by the Istanbul Arbitration Centre, or use another international institution while keeping Istanbul as the juridical seat. They may also conduct arbitration outside Türkiye and later seek recognition and enforcement against assets located in Türkiye.

The Turkish arbitration framework recognises domestic and international arbitration separately. International arbitration seated in Türkiye is principally governed by the Turkish International Arbitration Law No. 4686. Domestic arbitration is regulated under Articles 407 to 444 of the Turkish Code of Civil Procedure No. 6100. Türkiye is also a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which provides an internationally recognised framework for enforcing qualifying foreign and non-domestic awards.

This comprehensive guide explains why international companies choose arbitration in Turkey, the legal advantages of Turkey-seated proceedings, the role of ISTAC, the importance of the New York Convention and the practical matters businesses should consider when drafting arbitration clauses.

Arbitration Provides a Neutral Forum for International Companies

One of the principal reasons international companies choose arbitration is neutrality.

A foreign company may be reluctant to submit every dispute exclusively to the national courts of its Turkish business partner. Similarly, a Turkish company may not want disputes decided solely in the foreign counterparty’s home jurisdiction.

Arbitration allows both sides to select a neutral procedural structure rather than giving one party an apparent home-court advantage.

The parties may agree on:

• A neutral seat of arbitration;
• An independent arbitration institution;
• A sole arbitrator or three-member tribunal;
• Arbitrators of different nationalities;
• The language of the proceedings;
• The substantive law governing the contract;
• Procedural rules suitable for the transaction.

Istanbul may serve as a commercially practical and geographically accessible seat for disputes involving parties from Europe, Central Asia, the Middle East and North Africa. The parties may select Istanbul even if neither company is incorporated in Türkiye, provided that the dispute is legally capable of arbitration.

Neutrality does not necessarily require choosing a jurisdiction with no relationship to the transaction. It requires a framework in which neither party receives an unjust procedural advantage and both parties are given an equal opportunity to present their case.

Türkiye Has a Separate Legal Framework for International Arbitration

International companies generally seek predictability when selecting a dispute resolution system.

The Turkish International Arbitration Law No. 4686 specifically regulates international arbitration. It applies principally to disputes containing a legally recognised foreign element where the seat of arbitration is Türkiye. Certain provisions concerning arbitration objections and interim protection may also apply where the seat is located outside Türkiye.

A foreign element may exist where:

• The parties have their places of business in different countries;
• The agreed seat differs from the parties’ places of business;
• A substantial part of the contractual obligations is performed abroad;
• The transaction is most closely connected with another country;
• Foreign capital is brought into Türkiye;
• The transaction involves cross-border movement of goods or capital.

A dispute between two Turkish companies can therefore qualify as international arbitration. This may occur where a project is located abroad, equipment is imported, foreign financing is used or the agreement requires cross-border movement of capital or goods.

Domestic arbitration is governed separately. Article 407 of the Turkish Code of Civil Procedure provides that the domestic arbitration provisions apply to Turkey-seated disputes that do not contain the foreign element defined under the International Arbitration Law.

The distinction is important because it affects:

• The applicable procedural legislation;
• The competent supporting courts;
• Interim measures;
• The arbitration period;
• Annulment proceedings;
• The effect of an annulment application on enforcement.

International companies should classify the arbitration correctly instead of assuming that the nationality of the parties is the only relevant factor.

Party Autonomy Is a Central Advantage

International commercial arbitration is based on party autonomy.

The parties can design a dispute resolution mechanism that reflects the characteristics of their transaction. This provides substantially greater flexibility than ordinary court proceedings, where jurisdiction, procedural language, court structure and many procedural rules are imposed by legislation.

Turkish arbitration law allows the parties to determine or influence matters such as:

• The seat of arbitration;
• The institution and arbitration rules;
• The number of arbitrators;
• The method of appointment;
• The language;
• The substantive governing law;
• The timetable;
• Written submissions;
• Hearings;
• Expert evidence;
• Confidentiality arrangements;
• Document production;
• Allocation of arbitration costs.

Under the domestic arbitration provisions, the parties may freely determine the procedural rules, subject to mandatory provisions, or incorporate institutional arbitration rules by reference. If they do not agree, the tribunal conducts the arbitration in the manner it considers appropriate while complying with the statutory framework. Turkish law also requires equal treatment and an opportunity for each party to exercise its right to be heard.

This flexibility is especially valuable in international transactions involving different legal cultures.

For example, the parties may combine:

• Written witness statements commonly used in international arbitration;
• Technical expert reports;
• A limited document-production process;
• Online procedural conferences;
• A focused evidentiary hearing;
• Post-hearing cost submissions.

The procedure can therefore be adapted to the dispute instead of forcing a highly technical international case into a general litigation model.

International Companies Can Choose Specialist Arbitrators

Many cross-border disputes require specialised legal, commercial or technical knowledge.

A construction dispute may involve critical-path delay analysis, variation orders, performance guarantees and engineering standards. An energy dispute may involve gas-pricing formulas, electricity-market rules or renewable energy production calculations. A corporate dispute may involve shareholder valuation, deadlock provisions or complex exit mechanisms.

Arbitration allows companies to select arbitrators with appropriate expertise.

The parties may consider:

• Sector experience;
• Knowledge of Turkish law;
• Experience with the governing foreign law;
• Language skills;
• Availability;
• Arbitration experience;
• Technical understanding;
• Independence and impartiality.

In a three-member tribunal, each party may participate in nominating an arbitrator, while the chair is appointed through the agreed procedure or by the institution.

The ability to select the decision-makers is a major distinction between arbitration and court litigation. Court parties cannot ordinarily choose a judge according to the judge’s knowledge of energy, construction, software, valuation or international trade.

A specialist tribunal may understand complex project documents and expert evidence more efficiently. This does not guarantee a particular result, but it can improve the quality and commercial relevance of the decision-making process.

The Language of Arbitration Can Be Chosen Freely

International companies frequently use English as the working language of their contracts, project correspondence and corporate documentation.

Litigation before Turkish courts is conducted in Turkish. Foreign-language documents generally require Turkish translations, and interpretation may be required for foreign witnesses or representatives.

In arbitration, the parties may select English, Turkish or another agreed language.

This can reduce:

• Translation of contracts;
• Translation of correspondence;
• Duplication of technical documents;
• Interpretation problems;
• Risk of losing meaning in specialised terminology.

An international construction agreement written in English may therefore be arbitrated in English before a tribunal familiar with the relevant contractual terminology.

Language selection should nevertheless be made carefully.

The parties should consider:

• The language of the principal contract;
• The location of witnesses;
• The language of project records;
• The likely nationality of arbitrators;
• The law governing the merits;
• The potential need for Turkish court applications;
• Translation requirements during annulment or enforcement.

Even where the arbitration is conducted in English, Turkish translations may be required when interim protection, annulment or enforcement is requested before Turkish courts.

ISTAC Offers an Institutional Arbitration Framework

International companies may choose arbitration administered by the Istanbul Arbitration Centre, commonly known as ISTAC.

ISTAC provides institutional rules, administrative support, appointment procedures, cost scales and specialised mechanisms for domestic and international disputes.

Its official model clause provides that disputes arising out of or connected with the contract will be finally settled under the ISTAC Arbitration Rules. ISTAC also recommends that parties specify the place of arbitration, language, number of arbitrators and law governing the merits.

A properly drafted ISTAC clause may provide:

Any dispute, controversy or claim arising out of or in connection with this Agreement, including its formation, validity, interpretation, performance, breach, termination or consequences of termination, shall be finally resolved under the Istanbul Arbitration Centre Arbitration Rules. The seat of arbitration shall be Istanbul, Türkiye. The language of arbitration shall be English. The tribunal shall consist of three arbitrators. Turkish law shall govern the merits of the dispute.

The clause should be adapted to the value, complexity and international structure of the transaction.

Institutional arbitration offers several practical advantages:

• A defined procedure for commencing arbitration;
• Administrative communication with the parties and tribunal;
• An appointment mechanism if the parties cannot agree;
• Procedures for challenging arbitrators;
• Published cost scales;
• Emergency-arbitrator provisions;
• Fast-track arbitration;
• Online-hearing rules.

Institutional administration can be particularly valuable where the parties’ relationship has deteriorated and they are unable to cooperate even on appointing the tribunal.

Fast-Track Arbitration May Resolve Smaller Disputes Quickly

Not every international commercial dispute requires a lengthy arbitration involving multiple submissions and a three-member tribunal.

ISTAC maintains a fast-track procedure for eligible lower-value disputes. According to ISTAC’s currently published information, the Fast Track Arbitration Rules apply to disputes where the value of the claims does not exceed TRY 5,000,000. The procedure is designed to produce a final award through a sole arbitrator within three months following transmission of the case file, subject to the applicable rules and any permitted extension.

Fast-track arbitration may be suitable for:

• Unpaid invoices;
• Supply and delivery claims;
• Service-fee disputes;
• Agency commissions;
• Documentary indemnity claims;
• Smaller construction payment disputes;
• Commercial rent claims;
• Shareholder loan disputes.

Its advantages may include:

• A sole arbitrator;
• Fewer written submissions;
• Short deadlines;
• Documents-only determination where appropriate;
• Reduced institutional and tribunal costs;
• A defined award period.

The monetary threshold should be verified when arbitration is commenced because institutional rules and thresholds may change.

A case should not be placed in fast-track arbitration solely because it satisfies the monetary condition. Disputes involving extensive expert evidence, multiple parties or serious jurisdictional objections may require a standard procedure.

Emergency Arbitration Provides Urgent Protection

International disputes may require protection before the main arbitral tribunal is constituted.

A company may discover that its counterparty is:

• Transferring assets;
• Calling a performance guarantee;
• Disclosing confidential information;
• Selling disputed shares;
• Removing equipment;
• Destroying evidence;
• Terminating a critical agreement.

Waiting several weeks for the tribunal to be constituted may make the final award ineffective.

ISTAC’s Emergency Arbitrator Rules provide a mechanism for obtaining urgent interim protection before the file is transmitted to the sole arbitrator or tribunal. ISTAC states that the emergency arbitrator is appointed within two working days after receipt of a compliant application and ordinarily issues a decision within seven days. The emergency decision is binding on parties that consented to the mechanism.

Emergency arbitration may be preferable where:

• Confidentiality is important;
• The measure concerns obligations between the contracting parties;
• A specialist decision-maker is required;
• The parties want to avoid immediate public litigation;
• A reasoned interim decision is commercially valuable.

A Turkish court application may remain necessary where:

• Relief is required without notifying the opposing party;
• The measure concerns a non-signatory;
• A bank or registry must be bound;
• Physical seizure or official registration is necessary;
• Immediate coercive enforcement is required.

Emergency arbitration and court protection are not necessarily mutually exclusive. The correct strategy depends on the asset, urgency, arbitration agreement and applicable procedural law.

Arbitration Supports Online and International Participation

International companies often have directors, employees, witnesses, experts and lawyers located in different countries.

Requiring every participant to travel to a single location for each procedural meeting can increase cost and delay.

ISTAC maintains online-hearing rules and procedures designed to regulate hearings through video conference or teleconference. These rules address matters such as attendance, document presentation, confidentiality, witnesses, experts and technical preparation.

Online arbitration may reduce:

• International travel;
• Accommodation expenses;
• Scheduling difficulties;
• Time away from business operations;
• Hearing-room costs.

An arbitration legally seated in Istanbul may still conduct procedural conferences and evidentiary hearings online or in another physical location without changing the juridical seat.

The legal seat and physical hearing venue are distinct. The seat determines the procedural law and supervisory courts, while the hearing location concerns practical case management.

Türkiye May Be Selected as the Seat Even When Another Institution Is Used

International companies are not required to choose ISTAC simply because Türkiye is selected as the seat.

The parties may agree on:

• ICC arbitration seated in Istanbul;
• Ad hoc UNCITRAL arbitration seated in Istanbul;
• Another institutional arbitration seated in Türkiye;
• ISTAC arbitration seated outside Türkiye, subject to the applicable rules;
• ISTAC arbitration seated in Istanbul.

The institution and seat perform different functions.

The institution administers the case. The seat determines:

• The procedural arbitration law;
• The supervisory courts;
• The annulment jurisdiction;
• The legal nationality of the award;
• The relationship between the tribunal and national courts.

A clause should therefore specify both the institution and seat.

Stating only that “disputes will be resolved by international arbitration in Istanbul” may leave uncertainty regarding the applicable institution and rules.

Stating only that “disputes will be resolved under ISTAC Rules” identifies the institution but should still be supplemented with the city and country of the seat.

Turkish Courts Have a Supportive but Limited Role

International companies may be concerned that choosing Türkiye as the seat will expose the merits of the dispute to unrestricted court review.

Turkish arbitration law is based on limited judicial intervention.

Courts may assist with matters such as:

• Interim injunctions;
• Interim attachment;
• Appointment of arbitrators;
• Challenges to arbitrators;
• Evidence collection;
• Extension of the arbitration period;
• Setting aside the award;
• Recognition and enforcement.

However, courts do not ordinarily manage the arbitral proceedings or decide the commercial merits while the arbitration is pending.

The Turkish Code of Civil Procedure expressly provides that court assistance is available only in cases permitted by the arbitration legislation. The arbitral tribunal is also authorised to determine objections concerning its own jurisdiction, including the existence and validity of the arbitration agreement.

This reflects the principles of:

• Limited court intervention;
• Competence-competence;
• Separability of the arbitration agreement;
• Party autonomy;
• Finality of arbitral awards.

Court assistance remains valuable because arbitrators do not possess all coercive state powers. For example, an arbitral tribunal may require court assistance to secure evidence held by a non-party or to implement a measure affecting registered assets.

Arbitral Awards Are Not Subject to an Ordinary Merits Appeal

Finality is another important reason international companies choose arbitration.

An arbitral award seated in Türkiye cannot ordinarily be appealed merely because the losing party believes that the tribunal:

• Interpreted the contract incorrectly;
• Preferred the wrong expert;
• Misunderstood a witness;
• Awarded excessive damages;
• Applied the governing law incorrectly.

Turkey-seated awards may be challenged through an annulment action only on limited statutory grounds.

These grounds generally concern:

• Invalidity of the arbitration agreement;
• Lack of legal capacity;
• Improper constitution of the tribunal;
• Excess of jurisdiction;
• Serious procedural irregularity;
• Violation of equality or the right to be heard;
• Non-arbitrability;
• Public policy.

The annulment court should not conduct a complete rehearing of the commercial dispute.

Limited judicial review can shorten the post-award process compared with litigation systems involving several full appellate stages. It also increases the importance of selecting qualified arbitrators because the tribunal is generally the final decision-maker on the merits.

International Enforcement Is a Major Commercial Advantage

A favourable judgment has limited value if it cannot be enforced where the debtor owns assets.

International companies may prefer arbitration because arbitral awards benefit from the New York Convention framework.

Türkiye acceded to the New York Convention on 2 July 1992, and the Convention entered into force for Türkiye on 30 September 1992. Türkiye applies the Convention subject to the reciprocity and commercial reservations: it generally applies the Convention to awards made in another contracting state and to disputes considered commercial under Turkish law.

The Convention requires contracting states generally to recognise qualifying arbitration agreements and enforce foreign and non-domestic awards, subject to limited refusal grounds.

Potential refusal grounds include:

• Invalidity of the arbitration agreement;
• Lack of proper notice;
• Inability to present a defence;
• Excess of jurisdiction;
• Improper tribunal constitution;
• Award not being binding or having been set aside;
• Non-arbitrability;
• Public policy.

The enforcement court should not reconsider the entire merits.

For international companies, this means that a Turkey-seated award may potentially be enforced against assets abroad under the Convention, while a foreign award may be enforced against qualifying assets in Türkiye.

Potential enforcement assets may include:

• Bank accounts;
• Company shares;
• Commercial receivables;
• Machinery;
• Vehicles;
• Intellectual property;
• Real estate;
• Other movable or registered assets.

An enforcement strategy should begin before arbitration. The claimant should investigate where the debtor owns recoverable assets and whether interim protection may be required.

Arbitration May Offer Greater Commercial Privacy

International companies often want to avoid public disclosure of:

• Prices and profit margins;
• Trade secrets;
• Technical designs;
• Customer information;
• Internal investigations;
• Business strategies;
• Shareholder disagreements;
• Expert valuations.

Arbitration hearings are generally private and access can be limited to authorised participants.

However, businesses should not assume that every aspect of arbitration is automatically confidential. Confidentiality may depend on:

• The arbitration agreement;
• Institutional rules;
• Tribunal orders;
• Professional secrecy;
• Trade secret law;
• Personal data legislation.

A well-drafted arbitration clause or procedural confidentiality agreement should regulate:

• The existence of the arbitration;
• Pleadings and evidence;
• Witness and expert reports;
• Hearing recordings;
• Procedural orders;
• The final award;
• Permitted disclosure to insurers, auditors and funders;
• Disclosure required by courts or regulators.

Confidentiality may become more difficult during annulment or enforcement proceedings before national courts. Parties should disclose only the material legally necessary and seek appropriate protection for trade secrets and personal data.

Costs Can Be More Predictable through Institutional Arbitration

Arbitration is not automatically cheaper than court litigation.

A complex three-member international arbitration involving technical experts and lengthy hearings may be expensive.

However, institutional arbitration can make certain costs more predictable through:

• Published registration fees;
• Administrative fee scales;
• Arbitrator fee schedules;
• Cost calculators;
• Rules on advances;
• Sole-arbitrator procedures;
• Fast-track mechanisms.

ISTAC publishes cost and arbitrator fee scales based on the amount in dispute and the number of arbitrators.

Companies can control costs by:

• Choosing a sole arbitrator for suitable disputes;
• Selecting fast-track arbitration;
• Limiting document production;
• Using online hearings;
• Defining issues early;
• Coordinating experts;
• Avoiding repetitive submissions;
• Considering settlement throughout the case.

The likely arbitration budget should include more than institutional costs.

It should also include:

• Legal counsel;
• Experts;
• Translation;
• Interpretation;
• Hearing facilities;
• Technology;
• Travel;
• Court applications;
• Annulment;
• Enforcement.

Cost efficiency depends primarily on the design and management of the proceedings.

Arbitration Is Suitable for Major Sectors Connected with Türkiye

International companies choose arbitration in Türkiye across a wide range of industries.

Construction and infrastructure

Construction arbitration may concern:

• Delays;
• Extensions of time;
• Variations;
• Payment certificates;
• Defects;
• Performance bonds;
• Termination;
• Disruption and productivity.

Specialist arbitrators and experts can be particularly valuable in technically complex project disputes.

Energy

Energy disputes may involve:

• Electricity generation;
• Natural gas supply;
• Oil and petroleum contracts;
• Renewable energy projects;
• Power purchase agreements;
• Price reviews;
• Take-or-pay clauses;
• EPC performance guarantees.

These cases often require energy economists, engineers and regulatory specialists.

International trade and distribution

Common disputes include:

• Non-payment;
• Delivery failures;
• Product quality;
• Exclusive distribution rights;
• Termination;
• Agency commissions;
• Minimum purchase obligations.

Corporate transactions and joint ventures

Arbitration may address:

• Share purchase price adjustments;
• Warranty claims;
• Indemnities;
• Shareholder financing;
• Deadlock;
• Put and call options;
• Tag-along and drag-along rights;
• Non-compete obligations.

Technology and intellectual property

Technology disputes may concern:

• Software development;
• Licensing;
• Source code;
• Data security;
• Confidentiality;
• Service levels;
• Intellectual property ownership.

The availability of sector-specific arbitrators is one of arbitration’s strongest commercial advantages.

Arbitration Clauses Can Cover More Than Contractual Claims

A broad arbitration agreement may cover disputes arising from both contractual and non-contractual legal relationships.

This is important because international disputes may involve allegations of:

• Misrepresentation;
• Unjust enrichment;
• Breach of confidentiality;
• Tortious conduct;
• Pre-contractual liability;
• Unlawful interference.

A clause limited only to “interpretation of the agreement” may leave related disputes outside arbitration.

International companies commonly use broader wording covering disputes arising out of or in connection with:

• Formation;
• Validity;
• Interpretation;
• Performance;
• Breach;
• Termination;
• Consequences of termination.

Turkish law recognises written arbitration agreements and permits incorporation by reference to another document containing an arbitration clause. It also recognises the independence of the arbitration clause from the main contract and the tribunal’s authority to decide its own jurisdiction.

Arbitration Does Not Eliminate Every Legal Risk

Although arbitration offers substantial advantages, it is not suitable for every dispute.

International companies should consider several limitations.

Not every dispute is arbitrable

Under Turkish law, disputes concerning rights in rem over immovable property and matters that are not subject to the parties’ free disposition are generally not arbitrable.

Third parties may not be bound

Arbitration is based on consent. A parent company, bank, guarantor, subcontractor or affiliate is not automatically bound merely because it is connected with the transaction.

Interim relief may require courts

Measures involving non-parties, official registries or coercive seizure may require national court assistance.

Complex arbitration can be expensive

Three arbitrators, extensive experts and long hearings may produce substantial costs.

Enforcement may still take time

A debtor may resist recognition or enforcement, transfer assets or become insolvent.

Poor drafting creates jurisdictional disputes

A defective arbitration clause may cause substantial delay before the merits are considered.

These risks can be reduced through careful contract drafting, asset analysis and early dispute planning.

Drafting an Effective Arbitration Clause

A strong clause should clearly answer the following questions.

Which institution will administer the arbitration?

The clause should identify ISTAC, ICC or another institution by its correct official name.

What is the seat?

The city and country should be stated expressly.

What is the language?

The selected language should reflect the contract and likely evidence.

How many arbitrators will decide the case?

A sole arbitrator may be proportionate for smaller disputes. Three arbitrators may be suitable for complex or high-value transactions.

Which law governs the merits?

The substantive governing law should be identified clearly.

Which law governs the arbitration agreement?

A separate choice may reduce uncertainty, particularly where the principal contract is governed by foreign law.

Are emergency proceedings available?

The parties should decide whether emergency-arbitrator rules will apply.

Are negotiation or mediation required first?

Any multi-stage procedure should contain clear deadlines.

Can related disputes be consolidated?

Clauses in related contracts should be compatible.

Is confidentiality expressly protected?

The contract should identify the protected information and permitted disclosures.

Practical Checklist for International Companies

Before selecting arbitration in Türkiye, businesses should assess:

1. Whether the anticipated disputes are arbitrable;
2. Whether Türkiye should be the seat;
3. Whether ISTAC or another institution is more suitable;
4. Whether the dispute contains a foreign element;
5. Which procedural statute will apply;
6. The language of contracts and evidence;
7. The appropriate number of arbitrators;
8. The need for technical expertise;
9. The likely location of assets;
10. The need for emergency protection;
11. The relationship with related contracts;
12. The expected arbitration budget;
13. The confidentiality requirements;
14. The potential annulment and enforcement jurisdictions;
15. Whether fast-track arbitration may be appropriate.

The analysis should be completed before the contract is signed, not after the dispute arises.

Frequently Asked Questions

Why do foreign companies choose arbitration instead of Turkish courts?

Arbitration allows parties to select a neutral seat, specialist arbitrators, procedural language, governing rules and a flexible evidentiary process. Awards may also benefit from international enforcement under the New York Convention.

Can a foreign company choose Istanbul as the seat of arbitration?

Yes. Istanbul may be selected as the seat even where neither party is Turkish, provided that the dispute is legally arbitrable.

Must an Istanbul-seated arbitration use ISTAC?

No. The parties may select ISTAC, ICC, another institution or ad hoc arbitration while choosing Istanbul as the legal seat.

Can ISTAC arbitration be conducted in English?

Yes. The parties may select English or another agreed language in the arbitration clause.

How quickly can an ISTAC emergency arbitrator decide?

ISTAC currently states that the emergency arbitrator is appointed within two working days and ordinarily renders a decision within seven days after receiving the file.

Does ISTAC offer expedited arbitration?

Yes. Under its currently published framework, qualifying claims not exceeding TRY 5,000,000 may be resolved through fast-track arbitration by a sole arbitrator within the stated three-month period. The current rules should be verified when proceedings begin.

Can hearings be held online?

Yes. ISTAC maintains specific online-hearing rules and procedures.

Can Turkish courts reconsider the merits of an arbitral award?

There is no ordinary appeal on the merits. A Turkey-seated award may be challenged only on limited statutory grounds.

Can a foreign arbitral award be enforced in Türkiye?

Yes, subject to the New York Convention or Turkish private international law. Türkiye applies the Convention subject to its reciprocity and commercial reservations.

Is arbitration confidential in Türkiye?

Hearings are generally private, but complete confidentiality should be addressed through the arbitration agreement, institutional rules or tribunal orders.

Conclusion

International companies choose arbitration in Türkiye because it combines neutrality, party autonomy, specialist decision-makers, procedural flexibility and international enforceability.

Türkiye maintains separate legislative frameworks for international and domestic arbitration. International arbitration containing a foreign element is principally governed by Law No. 4686, while domestic arbitration is regulated under Articles 407 to 444 of the Turkish Code of Civil Procedure.

Businesses may select Istanbul as the legal seat, conduct proceedings in English, appoint arbitrators with industry expertise and choose institutional or ad hoc rules suited to their commercial relationship.

ISTAC provides a locally administered but internationally usable arbitration framework. Its services include standard arbitration, fast-track proceedings, emergency arbitration, online hearings, published model clauses and cost scales.

The New York Convention is a particularly important advantage. It may allow Turkey-seated awards to be enforced abroad and foreign awards to be enforced against qualifying assets in Türkiye, subject to limited defences.

Arbitration also offers greater procedural control than ordinary litigation. The parties may define:

• The institution;
• The seat;
• The language;
• The number of arbitrators;
• The governing law;
• The timetable;
• The evidentiary process;
• Confidentiality;
• Emergency protection.

These advantages depend on effective drafting and case preparation. A vague or contradictory arbitration clause can produce costly jurisdictional disputes. International companies should therefore coordinate arbitration provisions across all related contracts and consider enforcement from the beginning.

For cross-border transactions connected with Türkiye, specialised Turkish arbitration counsel can assist with drafting arbitration clauses, commencing ISTAC or international proceedings, obtaining interim measures, challenging or defending awards and pursuing recognition and enforcement against assets in Türkiye.