In contracts between Turkish and foreign companies, the governing law and the competent court to resolve disputes are determined separately. The parties may agree on which country's laws shall apply to the contractual obligation, may separately stipulate which state courts shall have jurisdiction over disputes, or may opt for arbitration.

It is crucial that these selections are set forth in the contract clearly, in writing, and in a mutually consistent manner. The selection of a foreign court does not mean that its judgment will be automatically enforceable in Turkey. As a rule, an enforcement (tenfiz) judgment is required for the compulsory execution of a foreign court decision in Turkey.

Under Turkish law, the choice of law in contractual obligations is assessed within the scope of Article 24 of the Law on Private International Law and Procedural Law (MÖHUK) No. 5718. Regarding the selection of a foreign court, Article 47 of MÖHUK is applicable; whereas for jurisdiction agreements concerning venue among Turkish courts, Articles 17-19 of the Code of Civil Procedure (HMK) No. 6100 are significant. Arbitration agreements are subject to the relevant provisions of the International Arbitration Law (MTK) No. 4686.

The following examples are hypothetical scenarios created for explanatory purposes. In a real dispute, the entire contract, the places of business of the parties, places of performance, the nature of the dispute, and applicable special provisions must be evaluated together.

1. The difference between governing law, jurisdiction, and arbitration

Governing law, determines which country's laws shall apply to substantive law matters such as the interpretation of the contract, obligations of the parties, consequences of breach of contract, and damages.

Competent court, pertains to which state's courts have jurisdiction to hear the dispute. Arbitration , on the other hand, is the agreement of the parties to submit their dispute to an arbitrator or arbitral tribunal instead of state courts.

These choices may be combined in various ways within the same contract. For example, while choosing Turkish law as the applicable law, the parties may stipulate that disputes shall be heard by the courts of England. In another contract, German law may be chosen and Istanbul may be designated as the place of arbitration.

The place of arbitration is not the same concept as the substantive law applicable to the arbitration. The place of arbitration is significant regarding the legal framework of arbitral proceedings and the supervisory jurisdiction of courts over certain matters.

2. How to determine the governing law in a contract?

2.1. Parties May Choose the Applicable Law

Pursuant to Article 24 of MÖHUK, contractual obligations are governed by the law expressly chosen by the parties. An implied choice of law, which can be unequivocally understood from the contract terms or the circumstances of the case, may also arise. However, to mitigate the risk of disputes, it is preferable to expressly state the chosen country's law in the contract.

For instance, a manufacturer established in Turkey and a distributor established in the Netherlands may stipulate that their contract is governed by Turkish law. This provision determines the applicable law; it does not, by itself, indicate that lawsuits will be heard in Turkey. Court jurisdiction must be evaluated separately.

The parties may agree to apply the chosen law to the entire contract or to a specific part thereof. The choice of law may also be made or modified after the conclusion of the contract. Pursuant to Article 24 of MÖHUK, the retroactive effect of a subsequently made choice is recognized, provided that the rights of third parties are reserved.

2.2. In the Absence of a Choice of Law, the Law Most Closely Connected Applies

If the parties have not made a choice of law, the contractual relationship is governed by the law most closely connected to the contract, within the framework of the conflict of laws rules set forth in Article 24 of MÖHUK.

In this assessment, the habitual residence of the party obliged to perform the characteristic obligation, or, in contracts concluded within the scope of commercial and professional activities, the law of the place of business is of significance. If the party obliged to perform the characteristic obligation has multiple places of business, the law of the place where the place of business most closely connected to the contract is located shall be taken into account. If all the circumstances of the case indicate another law more closely connected to the contract, such law may apply.

The characteristic performance is the fundamental performance that determines the nature of the contract. In a sale of goods, the seller's obligation to deliver, or in a consultancy agreement, the consultant's provision of services, may carry significance in this assessment. However, it cannot be said that the same party is automatically the debtor of the characteristic performance in every contract.

Therefore, it should not be concluded that the law of the seller or service provider will necessarily apply in every contract lacking a choice of law clause. The structure of the contract and all connecting factors must be examined together.

3. Choice of foreign court and jurisdiction of Turkish courts

3.1. Choice of foreign court under Article 47 of MÖHUK

Article 47 of MÖHUK allows for agreements to be made regarding the adjudication of disputes involving a foreign element and arising from obligations before a foreign state court. This option may be exercised in cases where the territorial jurisdiction of Turkish courts is not exclusive. The agreement must be proven by written evidence.

A choice of foreign court cannot eliminate the exclusive jurisdiction of Turkish courts. In employment, consumer, and insurance disputes, the special jurisdictional rules under Articles 44, 45, and 46 of MÖHUK must also be taken into consideration. Labeling a contract as commercial does not mean that special protective provisions will not apply.

Which disputes the jurisdiction clause covers, whether the chosen court is specified, the writing requirement, and the obstacle of exclusive jurisdiction must be evaluated together. General and vague expressions may create disputes in the interpretation of the contract.

In a lawsuit filed in Turkey based on a contract containing a foreign court selection clause, the court examines the validity of the provision and whether the objection was raised in due form, depending on the circumstances of the specific case.

3.2. Jurisdiction agreements between Turkish courts under Articles 17-19 of HMK

If the parties wish to select a specific court in Turkey, Articles 17-19 of HMK are taken into account. Pursuant to Article 17 of HMK, merchants or public legal entities may confer jurisdiction upon one or more courts regarding disputes that have arisen or may arise between them.

According to Article 18 of HMK, jurisdiction agreements cannot be made in matters where the parties do not have the freedom of disposition and in cases of exclusive jurisdiction. A valid jurisdiction agreement must be in writing, designate the legal relationship from which the dispute arises in a specific or determinable manner, and specify the competent court.

Pursuant to Article 19 of HMK, in disputes where exclusive jurisdiction does not apply, a jurisdictional objection must be raised in the statement of defense. Failure to make a jurisdictional objection in due form may lead to the court where the lawsuit was filed acquiring jurisdiction within the framework of the conditions set forth by the law.

A choice of foreign court and a territorial jurisdiction agreement between Turkish courts are not subject to the same rules. International jurisdiction and Article 47 of MÖHUK are evaluated in terms of the choice of a foreign court, whereas Articles 17-19 of HMK are evaluated in jurisdiction agreements between Turkish courts.

4. An arbitration clause is not the same as court jurisdiction

The parties may agree to resolve their disputes through arbitration instead of state courts. Pursuant to MTK Art. 4, an arbitration agreement is an agreement to resolve all or part of current or potential disputes through arbitration. An arbitration clause may be incorporated into the main contract or executed as a separate agreement.

MTK Art. 4 requires a written form for the arbitration agreement. Signed documents, certain means of communication exchanged between the parties, and electronic media may fulfill the written form requirement subject to the conditions set forth in the law. Whether an arbitration clause contained in standard terms incorporated into a contract has become part of such contract must also be examined.

In a well-drafted arbitration clause, the disputes to be referred to arbitration, the place of arbitration, the applicable arbitration rules, the number of arbitrators, and the method of their appointment should be set forth as clearly as possible. The language of arbitration and the substantive law applicable by the arbitrators may also be determined.

Pursuant to MTK Art. 5, when a dispute falling within the scope of the arbitration agreement is brought before a state court, the opposing party may raise an arbitration objection. The objection must be asserted in a timely and proper manner.

Arbitration does not in every case provide a faster or more cost-effective solution. Arbitrator fees, institutional costs, the place of arbitration, the language of proceedings, and the countries where the award will be enforced must be evaluated during the selection process. An action for annulment against international arbitral awards rendered in Turkey may be filed under the conditions specified in MTK Art. 15. The 30-day statutory period is calculated in connection with the notification of the award or the relevant additional awards specified in the law to the parties.

5. Recognition and enforcement of foreign court judgments in Turkey

Recognition and enforcement serve different legal purposes. Recognition relates to the acceptance of the res judicata or conclusive evidentiary effect of a foreign judgment in Turkey. Enforcement, on the other hand, enables the compulsory execution in Turkey of an enforceable foreign court judgment.

For instance, a foreign court judgment ordering a company to pay a monetary debt is not, as a rule, sufficient to initiate direct enforcement proceedings against its assets in Turkey. To enforce a foreign judgment in Turkey, an enforcement (tenfiz) order must be obtained from the competent Turkish court.

5.1. Application for enforcement and required documents

Pursuant to MÖHUK Art. 50, the execution in Turkey of final judgments rendered by foreign courts in civil matters, which have become final in accordance with the law of the country where they were rendered, is contingent upon the Turkish court issuing an enforcement order.

Within the scope of MÖHUK Art. 52-53, a properly certified copy of the foreign judgment, a document showing its finality, and translations bearing the necessary legalizations come into play upon application. The format of the documents and the legalization procedure must be determined by taking into consideration the relevant international conventions and regulations between the country where the judgment was rendered and Turkey.

5.2. Conditions for enforcement

Article 54 of MÖHUK regulates the conditions required for enforcement (tenfiz). There must be a reciprocity-based agreement, statutory provision, or de facto practice between the rendering state and Turkey. It is also essential that the judgment has not been rendered on a matter falling within the exclusive jurisdiction of Turkish courts and that the jurisdiction of the foreign court meets the conditions prescribed by law.

The foreign judgment must not be manifestly contrary to Turkish public policy (kamu düzeni). It is also evaluated whether the party against whom enforcement is sought was duly summoned or represented in the foreign proceedings and whether the conditions regarding the right to defense were met.

The enforcement review is not a retrial of whether the foreign court correctly resolved the merits of the dispute. However, service of process, the right to defense, public policy, and other statutory conditions are examined within the scope of the specific file.

Pursuant to Article 57 of MÖHUK, foreign judgments ordered to be enforced are executed in the same manner as judgments rendered by Turkish courts. Legal remedies and their effect on execution must be separately assessed in accordance with applicable procedural rules.

For detailed information regarding the legalization and translation of foreign documents and the use of court judgments in Turkey’s article on the validity of documents executed abroad in Turkey may be examined.

6. Judicial decisions regarding foreign court selection

In disputes concerning foreign forum selection clauses, the outcome does not depend solely on the mere mention of a foreign court's name in the contract. The text of the contractual provision, the nature of the dispute, the limits of exclusive jurisdiction, and the proper raising of a jurisdictional objection are evaluated together.

The decision of the 11th Civil Chamber of the Yargıtay, numbered E. 2025/2318, K. 2025/7273, and dated 04.12.2025,, addressed a contractual provision stating that disputes would be submitted to the courts of England. In the judgment, the jurisdictional condition was deemed valid in the specific case, and it was stated that, in the face of a duly raised jurisdictional objection, the lawsuit must be dismissed on procedural grounds due to the lack of international jurisdiction of the Turkish court. Judgment text.

This decision does not mean that every foreign forum clause is valid. The contractual provision and the characteristics of the dispute must be evaluated on a case-by-case basis. The docket and decision numbers of other decisions, as well as their full texts, should not be cited as definitive precedents without being verified from a reliable source.

7. Comparison of governing law, court jurisdiction, arbitration, and enforcement

Option	What determines?	Basic legal framework	Points to consider
Choice of applicable law	Substantive law applicable to the contract	MÖHUK Art. 24	Does not solely determine in which country's court the case will be heard.
Choice of foreign court	In which state court the dispute may be heard	MÖHUK Art. 47	Exclusive jurisdiction, special protection rules, and objection procedures are important.
Jurisdiction agreement among Turkish courts	Which court will have jurisdiction in Turkey’s courts	HMK m. 17-19	The nature of the parties, the written form requirement, and mandatory jurisdiction rules are examined.
Arbitration	Resolution of the dispute by an arbitrator or arbitral tribunal	MTK arts. 4-5 and, depending on the conditions, art. 15	The scope, form, and seat of the arbitration agreement must be clearly stated.
Enforcement of a foreign judgment	Execution of a foreign court judgment in Turkey	MÖHUK arts. 50, 54, and 57	Conditions regarding finalization, reciprocity, public policy, and the right to defense are evaluated.

8. Checklist for drafting contracts

When drafting governing law and dispute resolution provisions, the type of contract and the legal status of the parties must first be determined. The fact that the parties are merchants does not mean that an unlimited choice of law or jurisdiction agreement can be made for every dispute.

It must be clearly specified which contracts, annexes, and claims are covered by the governing law provision.
The chosen law and court jurisdiction should be regulated in separate provisions.
If a foreign court is to be selected, the court or courts must be explicitly specified.
It must be stated whether the jurisdiction clause is exclusive or in addition to existing competent courts.
If arbitration is preferred, the seat of arbitration, rules, language, and the selection of arbitrators must be evaluated.
The consequences of the chosen dispute resolution mechanism in the countries where the enforcement of the judgment is expected must be examined.
If enforcement of a foreign judgment in Turkey is anticipated, the conditions for enforcement and documentary requirements must be taken into account in advance.

The location of the parties and evidence, the country where the contract is to be performed, service of process facilities, the language of proceedings, and the countries where the judgment will be enforced are also important when choosing the dispute resolution method.

9. Frequently asked questions

If the applicable law is not stated in the contract, does Turkish law apply?

Not always. Pursuant to Article 24 of MÖHUK (Private International Law and Procedural Law Act), the law most closely connected to the contract shall apply. The place of business of the party providing the characteristic performance is a significant connecting factor; however, all circumstances of the case may point to a different law.

If the English courts have been chosen, can a lawsuit not be filed before a Turkish court?

This conclusion cannot be reached automatically. The scope of the written judgment, the foreign element of the dispute, exclusive jurisdiction and special protection rules, and the procedural raising of the objection are evaluated.

Does the selection of Turkish law ensure that Turkish courts have jurisdiction?

No. The choice of law determines the substantive law to be applied. The jurisdiction of the court is determined within the framework of a separate provision or applicable jurisdictional rules.

Can an arbitration clause be established through correspondence?

Pursuant to Article 4 of MTK, a written arbitration agreement can be established through communication means or electronic media exchanged between the parties within the framework of the conditions set forth in the law. The correspondence must demonstrate the mutual arbitration agreement and the scope of the dispute.

When can a foreign court judgment be enforced in Turkey?

The foreign judgment regarding a civil lawsuit must become final in accordance with the law of the country where it was rendered and the conditions set forth in Article 54 of MÖHUK must be met. After obtaining an enforcement (tenfiz) decision from the competent Turkish court, the judgment can be enforced within the framework of Article 57 of MÖHUK.

Is there a general application period for an enforcement (tenfiz) lawsuit?

The provisions of MÖHUK specified herein do not stipulate a single general application period for enforcement for all foreign judgments. However, the nature of the decision, its finality status, and applicable special provisions must be examined separately.

Conclusion

In contracts between Turkish and foreign companies, the applicable law, competent court, and arbitration choices must be regulated separately and consistently. The choice of law alone does not determine court jurisdiction; nor does the selection of a foreign court ensure that a foreign judgment will be automatically enforced in Turkey.

When drafting a contract, the status of the parties, the nature of the dispute, exclusive jurisdiction rules, the form of the arbitration agreement, and the country where the decision will be enforced must be evaluated together. The validity of the applicable law and jurisdiction clauses in a specific case must be examined within the framework of all provisions of the contract and current legislation.

Author Information

Atty. Batın Yılmaz
Istanbul Bar Association Bar Registry No: 77008

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This content has been prepared for general informational purposes and does not constitute legal opinion or consultancy in a specific case. Legal evaluation requires the joint examination of current legislation, relevant case law, and the unique circumstances of the event. The content has been prepared in compliance with the Attorneyship Law, the Union of Turkish Bar Associations Professional Rules, and the provisions regarding the prohibition of advertising for the legal profession; it does not guarantee a specific outcome.

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