COMMERCIAL CONTRACTS
HP Law delivers bespoke commercial contract drafting, negotiation, and dispute management services for international enterprises doing business in Turkey. Our cross-border practice specializes in distribution, franchising, agency, licensing, supply agreements, EPC contracts, and service level agreements (SLAs) tailored to protect international counterparties under the Turkish Code of Obligations and CISG standards.
Table of Contents
- Commercial Contracts Law in Turkey
- What is a Commercial Contract?
- How to Prepare a Commercial Contract?
- What Are The Commercial Contract Types?
- What is an International Commercial Contract?
- How to Terminate Commercial Contract?
- What Are Hayalioğlu & Partners Commercial Contracts Law Services in Turkey?
Commercial Contracts Law in Turkey
Commercial contracts are written documents used in all areas of commercial life. Commercial contract law is the branch of law needed for real and legal persons to defend and claim their rights in commercial life.
Businesses sign the right to which the law is granted through contracts. Contract law, which recognizes commercial rights and draws the boundaries of rights, also protects rights. So, what is commercial contract law?
What is a Commercial Contract?
Commercial contracts are legal documents that determine the rights and responsibilities of the parties. Contracts reduce the risk of conflict. It also minimizes the losses and costs that may arise from disputes.
A commercial contract is concluded between at least two parties. It refers to transactions such as the creation, termination and review of contracts. Commercial contracts are connected with branches of law such as; contract law, commercial law, labour law, the law of obligations and family law. Article 48 of the Turkish Constitution mentions the freedom of work and contract, and every citizen has this freedom.
How to Prepare a Commercial Contract?
Negotiation by the parties prepares commercial contracts. After the draft text is created and negotiations, the final text is decided.
Parties are divided into “debtor” and “creditor” in contracts. After the mutual declaration of will, commercial contracts emerge due to reconciliation. While preparing the contracts, the parties can arrange the contract as they wish. However, the articles requested to be added to the contract cannot be contrary to the relevant law provisions.
What Are The Commercial Contract Types?
Commercial contracts appear in all areas of life. Commercial contracts are needed when buying a car or house, taking a bank loan, giving power of attorney and making donations. Commonly used commercial contract types are listed below:
- Sales contract,
- Surety contract,
- Repurchase agreement,
- Loan agreement,
- Commission contract,
- Marketing contract,
- Loan agreement,
- Factoring contract,
- Franchise agreement,
- Exchange agreement,
- Warranty contract,
- Pledge contract,
- Mortgage contract,
- Intellectual and industrial rights agreements,
- Shareholders agreements,
- Joint Venture contracts,
- Distributorship agreements,
- Exclusivity agreements,
- An ordinary partnership agreement,
- Business arrangement,
- Service contract,
- Purchase and sale contract,
- Agency contract,
- Insurance contract,
- Mandate contract,
- Real estate sales promise contract,
- Dealer agreement.
What is an International Commercial Contract?
An international commercial contract is a legal document subject to commercial transactions between real or legal persons in different countries. This type of contract, which has a foreign element, is prepared with more than one legal system.
In international trade agreements, factors such as the countries in which the parties to the contract live, the law of contracts in those countries and geographical factors are considered. Contracts that do not have a personal or geographical element of foreignness are also considered within the scope of international trade contracts.
How to Terminate Commercial Contract?
Commercial contracts can be terminated by mutual agreement of the parties or unilaterally. There are some consequences of the termination of the trade contract. Contracts also include terms of termination. The terms of termination must be clearly stated in the trade contract.
Termination of the contract may differ depending on the contract type. However, even if the commercial contracts are terminated, there may be clauses that are not affected by this termination. For this reason, it is necessary to pay attention to the binding conditions in the case of termination in the trade contracts.
What Are Hayalioğlu & Partners Commercial Contracts Law Services in Turkey?
Hayalioğlu & Partners provides services with lawyers who are experts in the field of contract law. It provides legal support to our domestic and foreign clients in all sectors such as commercial contract issuance, contract review, contract evaluation, contract negotiation.
Services are provided on issues such as; commercial contract preparation, commercial contract termination processes and follow-up of the entire process. Comprehensive consultancy services are provided to our clients in case of termination of the commercial contract.
At the same time, in-company training is provided on issues to be considered in the preparation of commercial contracts, sector-specific contracts and contracts that need to be reconsidered within the scope of changing legislation.
Commercial Contracts Frequently Asked Questions (FAQ)
Can parties choose foreign law as the governing law in commercial contracts in Turkey?
Under Law No. 5718 on International Private and Civil Procedure Law (IPPL), parties to a contract with a foreign element may freely choose the applicable governing law, provided that mandatory rules of Turkish public policy (ordre public) and direct application statutes are respected.
Are dispute resolution clauses and international arbitration enforceable in Turkey?
Yes. Turkey is a contracting state to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Valid arbitration clauses selecting ISTAC, ICC, LCIA, or UNCITRAL rules are recognized and upheld by Turkish courts.
What formal requirements apply to commercial contracts under Turkish law?
While general contracts do not require a specific form under the principle of freedom of form (freedom of contract), specific agreements such as real estate transfers, preliminary sales contracts, financial leasing, and certain consumer/labor agreements must be executed in official written form or notarized to be legally valid.
How are liquidated damages and penalty clauses enforced in Turkey?
Under the Turkish Code of Obligations (TCO Art. 182), penalty clauses between commercial merchants are generally binding and enforceable. However, courts may reduce exorbitant penalty clauses if they threaten the economic existence of the debtor or violate morality.
