Debt Enforcement Procedures Against Turkish Companies: A Legal Guide for Foreign Creditors

Debt Enforcement Procedures Against Turkish Companies

When a Turkish company fails to pay an outstanding commercial debt, foreign suppliers, investors, and service providers may pursue legal remedies through enforcement and bankruptcy procedures under Turkish law. At ER&GUN&ER Law Firm, our English Speaking Turkish Lawyers assist international clients in recovering unpaid debts through court-based enforcement, asset seizure, and litigation in Turkey.

Can a Foreign Company File an Enforcement Proceeding in Turkey?

Yes. Foreign companies with valid claims may initiate enforcement proceedings in Turkey, even if they do not have a local branch. The only requirement is that the debt is enforceable (e.g., unpaid invoice, court judgment, signed contract).

Main Legal Tools for Debt Collection

  • General Enforcement Without Judgment (ilamsız takip): Used when creditor holds no court decision but has commercial evidence
  • Enforcement Based on Judgment (ilamlı takip): Based on Turkish or recognized foreign court decisions
  • Enforcement of Promissory Notes: Accelerated enforcement based on bills of exchange, cheques, or promissory notes

Step-by-Step Debt Enforcement Process

  1. Initiate enforcement file with Turkish Enforcement Office (İcra Dairesi)
  2. Payment order sent to debtor (7-day or 10-day response deadline)
  3. Debtor may object (itiraz) – this leads to court litigation
  4. In absence of objection, creditor may seize assets or bank accounts
  5. File for sale of seized assets if payment is not made

Cross-Border Enforcement of Foreign Judgments

If the foreign creditor already obtained a court judgment abroad, it must be recognized and enforced (tenfiz davası) in Turkey. Requirements include:

  • Final and binding foreign judgment
  • Reciprocity of enforcement between Turkey and the issuing country
  • No violation of Turkish public order
  • Proper notification and defense rights in original proceedings

Asset Seizure and Precautionary Attachment

  • Bank account freezing (Banka haczi)
  • Vehicle and equipment seizure (Taşınır haczi)
  • Real estate lien registration (Tapu haczi)
  • Third-party receivable attachment (e.g. client payments)

We act quickly to prevent asset loss through precautionary attachment (ihtiyati haciz) before a full trial.

Typical Debt Collection Scenarios for Foreign Companies

  • Unpaid export invoices from Turkish distributors
  • Construction disputes with Turkish contractors
  • Termination of commercial agency or franchise agreements
  • Unfulfilled service or consultancy contracts

Enforcement Court vs. Commercial Court

Enforcement offices handle the initial process. If the debtor objects, the dispute is referred to:

  • Civil Court of Peace: Simple enforcement objections
  • Commercial Court of First Instance: Complex business disputes

Timeframes and Enforcement Costs

  • Uncontested enforcement: 2–6 months
  • Contested litigation: 12–24 months
  • Average legal and enforcement costs: ~5–15% of the claim amount

We provide cost estimates and litigation risk analysis before initiating any legal action.

Internal Resources and Related Legal Guides

Contact Our Debt Collection Lawyers in Turkey

If you are a foreign company or creditor owed money by a Turkish firm, our experienced team at ER&GUN&ER Law Firm will take prompt and professional action. We handle all steps from enforcement filing to litigation and asset seizure. Contact our English Speaking Turkish Lawyers to protect your financial rights in Turkey.