Debt Collection in Turkey

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Enforcing Contracts

 

For enforcing contracts in Turkey, the World Bank Doing Business 2018 ranks the country as 30th in the 190 countries considered. Time to resolve a claim through local courts takes a total average of 580 days, just 2 days longer than the OECD high income countries. But the cost of enforcement as percentage of the claim value is 24.9% against 21.5%. Further, the quality of the judicial process is fairly high, with a score of 13 out of a maximum of 18.

 

Out of Court Debt Collection in Turkey

 

To pursue amicable debt collection in Turkey you must provide a Power of Attorney (POA) to your local collector and supply all relevant documents to support your claim. For example and depending on your trade, you should hand over the following documents, also necessary in case of legal action:

 

  • Sales Contract
  • Purchase Order
  • Invoice
  • Correspondence
  • Delivery receipts
  • Terms and Conditions of Sale

 

If you have not included a statutory interest in your contract, as a creditor you can claim 9 points of interest above the European Central Bank base rate. Also, for B2B claims the Statute of Limitations in Turkey is 10 years.

 

Legal Action in Turkey

 

As per out of court debt collection, your Turkish lawyer will need a POA which will also require notarization along with an apostille. Further, you will have to post a bond to bring proceedings, such as stamp duties, court costs and the like. Be prepared to have a witness to testify at trial if the judge requires so and have the documents translated in Turkish.

 

The Turkish Civil Proceduce Code offers several proceedings to pursue legal action so it depends on the nature of the case and the court hearing the case. Your lawyer could bring the case in a civil court of first instance or a commercial court of first instance, for example.

 

Note that if you win, while the court may not rule for reimbursement of your legal action costs may decide on the cost of enforcement. The judgement must be final and will be enforced by the Execution Office but you need an injunction order to attach your debtor’s assets.

 

Why Recoupera

 

Debt collection in Turkey needs expertise in commercial matters attainable only through highly specialized collectors. For example, relying on generalist lawyers won’t serve your purpose. Recoupera connects you with world class debt collection professionals able to assist you in extra-judicial and legal matters not just in Turkey, but worldwide.

 

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Brief Introduction to Turkey’s Economy and Import Profile

 

Turkey is a founding member of the OECD and part of the G-20. It’s the world’s 13th largest economy with a GDP of US $841bn (Current Prices) and ranks 28th as exporter of goods for a total of US $152bn (2015).

 

In 2016, Turkey imported US $189bn of goods. Some imports (2016) of interest but not prominent are packaged medicines for US $2.6bn, scrap iron for US $3.95bn, ethylene polymers for US $2.33bn and seeds oil for US $1.02bn. Its major trading import partners are 1. China 13%, 2. Germany 11%, 3. Russia 8%, 4. United States 5.8% and 5. Italy 5.4%.

 

Some Tips on Export To Turkey

 

Export to Turkey requires submission of the following documents based on the type of product imported in the country:

 

  • commercial invoice
  • proforma invoice
  • bill of lading or airway bill
  • certificate of origin
  • certificates e.g. phytosanitary for agricultural produce
  • import license

 

You should have three copies of the bill of lading, or airway bill, as well as for the commercial invoice bearing full description of items, quantity and prices along with applicable HS code. The certificate of origin should be in English and in duplicate copy as one will be retained by Turkish customs. Finally, the proforma invoice should be less than six months old. For Customs tariffs, you can check the information provided by the Ministry of Customs and Trade.

 

In general you can export all kinds of goods to Turkey except those local authorities prohibit, are subject to quota or require special authorization. The Ministry of Economy provides some guidance on the quality and safety checks performed and required on imported products.

 

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This article contains general legal information and material for informational purposes only which are not intended and should not be taken as legal advice. Recoupera is not a collection agency and it is not a law firm or a substitute for an attorney or law firm. All informational material provided may not reflect changes in the law. For legal advice, contact a lawyer.