1. Debt Execution Procedure

The Debt Execution Process is initiated through the Debt Execution Office (İcra Dairesi) by a debt collection lawyer. Once the application is submitted, the office issues an order of payment to the debtor.

Objection to the Payment Order

• If the debtor objects to the debt, the execution process is automatically halted.
• The debtor must submit an objection within:
  • 7 days (for general debts)
  • 5 days (for debts arising from checks and bonds)
• If an objection is raised, the creditor must file a lawsuit to continue the enforcement process.

Mediation Requirement

Before initiating a commercial litigation case, mediation is mandatory. The first 2 hours of mediation are covered by the Turkish Ministry of Justice.

Penalty for Unjustified Objections

If the court rules in favor of the creditor, an unfair objection made by the debtor will result in a penalty fee of 20% of the debt amount, payable to the creditor.

Execution Fees

• Debt execution fee: 0.05% of the debt amount
• Additional administrative fees: Approximately 10 TRY

If the debtor objects, the matter moves to litigation before a court.

2. Litigation Procedure

If a debt dispute requires court intervention, the litigation process will involve a review of:

• Invoices
• Contracts
• Correspondence
• Accounting records
• Other supporting evidence

This process includes hearings, where both parties present their claims and counterclaims.

Litigation Fees

• Court fee: 59/1000 of the claimed amount
• Additional costs: Expert reports, legal notifications, and court expenses
• Initial fee payment: Only ¼ of the total litigation fee is required at the beginning, with the remainder payable before the final judgment.

Legal Representation

• Debt execution and litigation must be handled by a Turkish attorney with a valid power of attorney (PoA).
• Power of attorney can be obtained through:
  • Turkish embassies and consulates (for Turkish citizens and legal entities)
  • Relevant authorities in the creditor’s country (for foreign citizens and entities)

Validation of Foreign Powers of Attorney

• A power of attorney issued abroad must be legalized either by:
  1. Apostille Certification (for countries party to the Hague Convention)
  2. Approval by the Turkish Embassy/Consulate (for non-Apostille countries)

Security Deposit Requirement for Foreign Creditors

If a creditor’s country imposes restrictions on Turkish citizens/legal entities in litigation matters, Turkish courts may require a security deposit before accepting the case.

This obligation—Cautio Judicatum Solvi—applies in the absence of a bilateral judicial assistance agreement between Turkey and the creditor’s country.

Security Deposit Amount

• Determined by the court (usually 15% of the disputed amount)
• Must be deposited before the litigation or enforcement process begins.

Countries with Judicial Assistance Agreements with Turkey

Turkey has judicial cooperation agreements with the following countries, exempting their citizens from security deposits:

Germany | Switzerland | United Kingdom | Italy | Ukraine | Azerbaijan | China | Albania | India | Romania | Morocco | Jordan | Tunisia | Austria | Bulgaria | Poland | Kazakhstan | Mongolia | Czech Republic | Uzbekistan | Hungary | Iraq | Algeria | Moldova | North Macedonia | Tajikistan

Countries Exempt from Security Deposits Due to Reciprocity

Based on the reciprocity principle in Turkish Private International Law, the following countries do not require a security deposit:

Russia | Egypt | Chile | Finland | Peru | Libya | Syria

Methods of Security Deposit Payment

Foreign creditors can provide the security deposit using:
✔ Bank transfer to the Turkish Central Bank (in foreign currency)
✔ Bank guarantee letter
✔ Real estate pledge in Turkey
✔ Notary-approved guarantee letter
✔ Bill of exchange

Once the case concludes, the security deposit is refunded to the creditor.

Purpose of Security Deposits

The main reason for imposing security deposits is to protect Turkish debtors from potential financial harm caused by foreign litigation.

Conclusion

Debt collection in Turkey involves two primary legal routes:

• Debt execution procedure (administrative enforcement)
• Litigation process (court enforcement)

Creditors should carefully consider the legal fees, procedural steps, and potential security deposit requirements before initiating a claim. Consulting a Turkish debt collection lawyer ensures compliance with Turkish law and maximizes recovery efforts.