TURKEY Trends and Developments Contributed by: Mehmet Karlı, Selim Can Bilgin, Tolga Bayrak and Gülnur Ceylan, Kabine Law Office
a protective measure and therefore does not require the award to have already acquired the status of a domestic judgment. The corresponding safeguard for respondents is a security requirement, generally fixed at 10–15% of the claim value, intended to pro - tect against the consequences of an ultimately unsuc - cessful enforcement process. The strategic implication for creditors is that asset tracing should not be left until after recognition or enforcement is completed. Where assets in Türkiye can be identified, provisional attachment may be available at an earlier stage and can help preserve recovery prospects during what may otherwise be a lengthy enforcement process. A clearer roadmap for ICSID award enforcement Another significant recent development concerns the enforcement of International Centre for Settlement of Investment Disputes (ICSID) awards in Türkiye. Article 54 (1) of the ICSID Convention requires each Con - tracting State to recognise an award rendered under the Convention as binding and to enforce the pecuni - ary obligations imposed by that award as if it were a final judgment of one of its own courts. This is one of the defining features of the ICSID system and a key advantage of ICSID arbitration over other arbitral regimes that may also be available for investor-state disputes, depending on the applicable bilateral invest - ment treaty and the investor’s choice of forum. Unlike non-ICSID awards, ICSID awards are not subject to exequatur proceedings under domestic law or the New York Convention. That does not mean, however, that no domestic pro - cedure is required. Article 54 (2) of the ICSID Con - vention provides that a party seeking recognition or enforcement must furnish a copy of the award certi - fied by the ICSID Secretary-General to the competent court or other authority designated by the relevant Contracting State. It further requires each Contracting State to notify the Secretary-General of the court or authority designated for that purpose. Türkiye ratified the ICSID Convention in 1989, but for many years there was uncertainty over the domestic route for enforcing ICSID awards under Article 54 (2). The practical difficulty became clear in 2016, when
Turkmenistan sought to enforce a costs award directly through Turkish debt-collection offices. At that time, Türkiye had not yet made its Article 54 (2) designation. When the matter reached the Court of Cassation in 2021, the court held that no competent authority had been designated at the relevant time and that enforce - ment could not proceed directly through execution offices without the required domestic procedure. Türkiye made its Article 54 (2) notification in 2017, designating the first-instance commercial court at the place agreed by the parties in writing, or in the absence of such an agreement, at the losing party’s domicile, if not, residence, or in the absence of both, the location of the subject property of the claim, as the competent forum. The first-instance civil court is competent only in places where no commercial court exists. However, Türkiye has not enacted detailed legislation setting out the mechanics of ICSID award enforcement. A 2025 appellate decision involving Oman is currently the best available guidance on the point, although it remains subject to cassation review. The decision indicates that the competent forum is the commercial court at the place where the losing party is domiciled in light of Türkiye’s Treasury Undersecretariat having advised the ICSID Secretariat in 2017 that commer - cial courts are the competent forum for such mat - ters generally. The decision refers only to commercial courts, likely because the defendant company’s regis - tered seat, Ankara, has a commercial court. The case therefore did not require the court to address the civil court fallback that applies, per the 2017 notification, only where no commercial court exists at the relevant place. The court’s review is narrow. It does not revisit the merits but only verifies the certified award and checks whether there is a stay or annulment. A stay requires a formal order, not simply a pending annul - ment application; if the security ordered by an ICSID ad hoc committee is not furnished, any existing stay is lifted. Pending formal legislation, the 2025 decision is a meaningful step towards clarifying a process that had long been uncertain.
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