• NSN Law Bulletin

Recent Developments on the Jurisdiction of Turkish Courts within the Article 105 of the TCC

According to Article 102 of the Turkish Commercial Code numbered 6102, an agency means a person who acquires a profession to conclude contracts on behalf of a merchant or to mediate such contracts concerning a mercantile business, without having a dependent status within a specific place or region. In other words, an agency is an independent assistant to the merchant.

Pursuant to Article 105 of the Code titled “The Authorities of the Agency”, an agency entitled to file a lawsuit on behalf of the Principal and to be a party to the lawsuits filed against the Principal in disputes arising from the contract which is concluded or mediated in the way that mentioned above.

In case of a jurisdiction clause authorizing foreign courts in a carriage contact which has been concluded or been mediated by an agent in Turkey on behalf of the principal abroad, the issue whether a lawsuit can be filed in Turkish courts for the disputes arising from such contract has been discussed for a long time both in doctrine and practice.

There are many decisions that the provision of Article 47 of the International Private and Procedural Law numbered 5718 has been considered on a preferential basis. In accordance with the Article 47 titled “Agreement on Jurisdiction and Limitations” of the Law, “Except in cases where the jurisdiction of a court is determined according to exclusive jurisdiction of specific court principles, the parties may agree on jurisdiction of a court of foreign state in a dispute that contains a foreign element and arises from obligatory relations. The competent Turkish court shall have jurisdiction only if the foreign court decides that it has no jurisdiction or if a plea as to jurisdiction is not presented in Turkish courts.” In cases where there is a foreign element and there is also an international jurisdiction agreement, Courts may evaluate the authorization agreement according to said article. If the foreign court deemed itself unauthorized, or not objected to the authority of the Turkish Courts, the case would be rejected procedurally. And, the Supreme Court accepted these rejection decisions in accordance with the same article. . (11st Civil Chamber of the Supreme Court, E. 2014/7079 K. 2014/9707, 26.5.2014 )

On the other side, in the decision of the 11st Civil Chamber of the Supreme Court dated 19.09.2016 numbered .2016/6216 E. and K. 2016/7347, it is decided that the jurisdiction objection alleged by an agency would not be heard:”The defendant party which is an agency, filed an authorization objection based on the bill of lading issued between the plaintiff and the non-joinder company. The defendant agency, who is a third party according to the contract, cannot benefit from the authorization agreement on the bill of lading since the bill of lading is only binding on the parties due to the principle of relativity of contracts. Therefore, the decision of non-jurisdiction by accepting the objection as to jurisdiction alleged on the basis of the bill of lading by the defendant is not considered correct and required reversal”

The same civil chamber of the Supreme Court has reconsidered this matter for a new case that is held before recently. In the decision dated 22.6.2020 and numbered 2019/3799 E. 2020/3051 K, it is approved that Article 105 of the Turkish Commercial Code entitled Turkish courts an exclusive international jurisdiction in such disputes. Following, any jurisdiction terms on the bill of lading determining foreign courts entitled to hear the disputes arising from the contract which is being mediated or concluded, was deemed to be invalid due to removing the exclusive authority of Turkish courts.

As the present, even if there is a jurisdiction clause in favour of a foreign court in a contractual relation, that is mediated by an agency, involving foreign elements, the cases regarding these contracts can be heard before the Turkish courts. Please kindly note that while evaluating each case as to determine the jurisdiction of a Turkish court, it has an importance to define the role and activities of the agency in the conclusion of the contract correctly, and to review the compliance of the jurisdiction clause with the mandatory provisions of Turkish law, in addition to TCC 105 and IPPL 47.

Author: Bahar Üçüncü