Arbitration has become a preferred method of dispute resolution in international commerce due to its flexibility, confidentiality and the enforceability of arbitral awards. English law and Turkish law provide robust frameworks for arbitration, yet they reflect different legal traditions and practices. In this article, we delve into the key differences between the two jurisdictions, providing insights for practitioners navigating arbitration in either country.
In England, the primary source of arbitration law is the <span class="news-text_italic-underline">Arbitration Act 1996</span> (“<span class="news-text_medium">AA 1996</span>”). This legislation is comprehensive and modern, incorporating principles from the UNCITRAL Model Law on International Commercial Arbitration (although the UK has not adopted the Model Law wholesale).
The AA 1996 is designed to provide a clear and flexible legal framework, giving parties autonomy while ensuring the process is fair and efficient. It emphasises minimal court intervention, reinforcing the principle of party autonomy and upholding the finality of arbitral awards.
In Turkiye, arbitration is governed by two main statutes: the Turkish International Arbitration Law of 2001 (“<span class="news-text_medium">TIAC</span>”), which applies to international arbitrations; and the Turkish Code of Civil Procedure (“<span class="news-text_medium">TCCP</span>”), which governs domestic arbitration.
The TIAC is largely based on the UNCITRAL Model Law, reflecting Turkiye’s commitment to harmonising its arbitration practices with international standards. The TCCP, on the other hand, applies to arbitrations that are purely domestic and contains provisions that align with traditional civil law principles. This offers a more prescriptive approach compared to the flexibility of the TIAC.
Under English law, the courts are supportive of the arbitration process and intervene only in specific circumstances. This includes certain challenges to the arbitral tribunal’s jurisdiction and in the enforcement of arbitral awards.
In line with the AA 1996’s principle of minimal judicial interference, the English courts respect the autonomy of the arbitration process. The courts may assist in matters such as the appointment of arbitrators or the granting of interim measures, but they are careful not to undermine the arbitral tribunal’s jurisdiction.
Turkish courts also adopt a supportive role in arbitration, particularly under the TIAC which, like the AA 1996, limits court intervention to specific instances. However, under the TCCP, the Turkish courts have a broader scope of intervention in domestic arbitrations, conveying Turkiye’s civil law heritage where courts traditionally have a more active role in judicial processes.
Turkish courts may intervene in appointing arbitrators, granting interim measure, and the setting aside of awards. However, the grounds for such actions are narrowly defined to avoid unnecessary interference.
In England, the AA 1996 allows parties significant freedom in appointing arbitrators. Parties can agree on the number of arbitrators, the procedure for their appointment and any qualifications arbitrators must possess. If the parties cannot agree, the AA 1996 provides default mechanisms, such as court-appointed arbitrators. The English approach emphasises party autonomy with the underlying principle that the arbitration process should be tailored to the parties’ needs.
Under Turkish law, both the TIAC and the TCCP provide for the appointment of arbitrators with a similar emphasis on party autonomy. However, Turkish law is more prescriptive in certain aspects, particularly in domestic arbitrations under the TCCP.
For example, if parties fail to agree on the number of arbitrators, the default position under Turkish law is a sole arbitrator. The TIAC, reflecting the UNCITRAL Model Law, offers greater flexibility in international arbitrations, allowing parties to structure the appointment process as they see fit.
Section 5 of the AA 1996 requires arbitration agreements to be in writing, though this requirement is broadly interpreted to include written evidence of the agreement. The AA 1996 upholds the principle of separability. This means an arbitration clause within a contract can remain valid as a distinct agreement even where the substantive contract is void. This ensures the arbitration process can proceed despite disputes concerning the underlying contract’s validity.
Turkish law also requires arbitration agreements to be in writing, with a similarly flexible interpretation of “in writing.” The TIAC explicitly recognises the principle of separability, mirroring the approach under English law. However, in domestic arbitration under the TCCP, while the principle of separability is recognised, there is a stronger emphasis on ensuring the arbitration agreement is clearly and unequivocally established, reflecting a more cautious approach.
The AA 1996 governs the enforcement of arbitral awards in England under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “<span class="news-text_medium">New York Convention</span>”). The English court is known for its pro-arbitration stance, having limited grounds for refusing enforcement such as public policy concerns or serious procedural irregularity. The English courts’ general approach is to uphold the finality of arbitration and enforce domestic and international awards.
As a signatory to the New York Convention, Turkiye has a similar framework for recognising and enforcing arbitral awards. The TIAC provides for the enforcement of international arbitral awards, while the TCCP governs domestic awards. Turkish courts are generally supportive of enforcing arbitral awards, although they may refuse enforcement on grounds similar to those in English law. However, in practice, Turkish courts take a slightly more conservative approach, particularly in cases involving domestic awards.
The AA 1996 allows arbitral tribunals and the English court to grant interim measures, such as orders to preserve evidence or injunctive relief. The tribunal’s power to grant interim measures is broad and the courts can support the arbitration process by enforcing these measures when necessary. English law views interim measures as an essential tool to ensure the arbitration process is effective and the award can be enforced without prejudice.
Turkish law also allows for interim measures, with the TIAC giving the arbitral tribunal the authority to grant such measures in international arbitration. However, parties must apply to the Turkish courts to enforce these interim measures. Under the TCCP, the Turkish courts provide greater support in granting interim measures in domestic arbitration. This reflects a traditional civil law approach where judicial support is considered crucial in enforcing such measures.
Both English and Turkish arbitration laws are designed to facilitate effective dispute resolution with emphasis on party autonomy and the enforceability of arbitral awards. English law offers greater flexibility and less court intervention, particularly in international arbitration. While modern and harmonised with international standards, Turkish law retains elements of its civil law heritage, particularly in domestic arbitration, where court oversight is more pronounced.
Belgravia Law, with our team of highly qualified, multilingual lawyers, specialises in English law with a strong focus on arbitration. We are eager to collaborate with esteemed Turkish law firms, offering our expertise in both English and Turkish legal frameworks and exchanging valuable legal insights on arbitral matters.
