In some disputes between the parties in which foreign arbitration is authorised, the time spent in the foreign arbitration proceedings while the creditor reaches its receivables causes the debtor to miss property and the creditor to suffer losses. For this reason, it is of great importance for the parties that Turkish Courts can decide on interim legal protection measures in disputes where foreign arbitration is authorised and that these decisions can be enforced.
Although in foreign arbitration proceedings, foreign arbitrators have the authority to issue interim measures in accordance with the powers granted to the arbitrators or arbitral institutions to resolve the dispute either by international conventions, by the rules of the arbitration centres authorised by them, or by the legislation or the parties’ arbitration agreements, the exercise of this authority does not provide any practical benefit. As a matter of fact, in order for foreign arbitrators or courts to enforce interim injunctions and interim attachment awards in Turkey, these awards must be enforced. However, considering the nature of interim injunctions and interim attachment as temporary protection measures and their non-finality, it is clear that the enforcement of these decisions in Turkey will not be possible, and therefore, they will not provide the expected benefit of the temporary legal protection measure.
In order to protect the creditor for the reasons explained above, the legislator has preserved certain powers of the Turkish judiciary, even though an arbitration agreement has been concluded regarding the relationship between the parties. As a matter of fact, Article 6 of the International Arbitration Law reads as follows: “It shall not be contrary to the arbitration agreement if one of the parties requests a precautionary measure or a precautionary attachment from the court before or during the arbitration proceedings and the court decides on such a measure or attachment.” Therefore, an arbitration agreement between the parties does not prevent one of the parties from enforcing the interim attachment and interim injunction provisions. Again, the fact that the Turkish judiciary is authorised to rule on security measures in arbitration proceedings does not eliminate or limit the authority of the Turkish judiciary in this regard.
Therefore, both before the commencement of the foreign arbitration proceedings and during the foreign arbitration proceedings, if the other conditions are met, the Turkish Courts may be requested to make a judgement in terms of provisional legal protection measures under Turkish law.
Another issue to be considered here is to ensure that the interim injunction and interim attachment decisions taken by the Turkish Courts continue and survive until the conclusion of the arbitration proceedings. As the name suggests, interim measures of protection are temporary and may be lifted automatically or pursuant to a court decision if certain conditions are met or not met.
Article 10 of the International Arbitration Law states that “If one of the parties has obtained a preliminary injunction or a preliminary attachment order from the court, it must file the arbitration case within thirty days. Otherwise, the interim injunction or interim attachment shall be automatically cancelled.” In summary, if, upon the request of one of the parties, the Turkish Courts have issued a ruling on one of the provisional legal protection measures before the foreign arbitration proceedings, the party requesting a provisional legal protection measure must initiate the arbitration process before the competent foreign arbitration within thirty days after the decision on the provisional legal protection measure, and the court that issued the provisional legal protection measure must be notified when the process is initiated. Otherwise, the interim legal protection measure shall be automatically lifted.
Another issue to be considered is the procedure to be followed after the interim attachment order issued by the Turkish Courts. As it is known, according to Article 261 of the BEC, “The creditor is obliged to request the execution of the decision from the enforcement office within the jurisdiction of the court that issued the decision within ten days from the date of the interim attachment decision. Otherwise, the precautionary attachment decision is automatically cancelled.” This provision is in effect. Therefore, the party who has received a precautionary attachment decision must request the execution of this decision within ten days. Otherwise, the interim attachment order will be automatically lifted. So, how will it be possible to proceed with the main proceedings before the commencement of the arbitration proceedings or during the arbitration proceedings? It is possible to initiate enforcement proceedings through general attachment despite the existence of a valid arbitration agreement. As a matter of fact, since enforcement proceedings without judgement is not a lawsuit, there is no legal obstacle for the creditor to initiate enforcement proceedings without judgement despite the
arbitration agreement. Again, the EBL has given the parties the right to pursue enforcement proceedings through general attachment, and there is no restriction in this direction, including the arbitration agreement.