TURKISH LAW IS TAKING STEPS TOWARDS OUT OF COURT PROCEDURES
Multinational corporations (MNC) like to invest and explore upcoming economies and developing countries that have flexible legislation towards investors and related litigation. Fast and effective dispute resolutions as well as legal and economic foreseeability are key factors in minds of investors while making the critical decision of where to invest. A prudent investor would first take council with his lawyers and investigate what would happen if everything goes wrong. As globalisation ties each country with unseen economic and politic ties many countries compete in this sphere. Custom regulations as well as legal statuses of foreigners are important and making easily comprehendible norms with flexibility towards traders and investors allows economic growth.
It is disputed whether alternative dispute resolution methods are more effective than government litigation, however, it is uncontested that it is shorter and much faster than court proceedings. In the minds of MNCs and foreign investors arise doubts whether, for example, Turkish courts could maintain impartiality when one of the sides is Turkey and another a foreigner. This is the reason why arbitration was born. International Chamber of Commerce (ICC) in Paris, Vienna International Arbitration Centre (VIAC), New York International Arbitration Centre (NYIAC), Russian Arbitration Association (RAA) and Singapore International Arbitration Centre (SIAC) are the main providers of safe harbour to dispute resolutions for foreign investors and MNCs. There has been a gap in geographical location between these centres as Middle East has no mainly dominant arbitral centre in this sphere. Istanbul – Turkey being in between Europe and Asia was seen as a perfect placement for a new Arbitral Centre which was consequently opened in 2015 – Istanbul Arbitration Centre (ISTAC).
Additionally Turkey has adopted set of rules that also raised many eyebrows – mandatory mediation. In its nature both of these words should never even exist in the same sentence since the essence of mediation is its voluntariness. Luckily arbitrary mediation is the main rule and international disputes are not touched by the aforementioned “Quasimodo” rule.
Leaving out numerous disputes on this topic it is safe to say that this approach is nonetheless a big step in Turkish Legal Life and hopefully other steps to follow would be prudent and well calculated.