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Recent Developments in Turkish Maritime Law
News & Insights 12 August 2012
The Turkish Commercial Code 1957 has recently been amended by a New Turkish Commercial Code (new TCC) which came into force on 1 July 2012.
The Turkish Commercial Code 1957 has recently been amended by a New Turkish Commercial Code (new TCC) which came into force on 1 July 2012. The language of the new TCC is more simplified than its predecessor.
In the past many of the international maritime conventions to which Turkey is a signatory had been incorporated into its domestic legislation by the German Commercial Code (GCC) which formed part of the old TCC.
The role of the GCC has been removed by the new TCC, which now incorporates the provisions of the main international maritime conventions to which Turkey is a signatory, such as the Hague, Hague Visby, Hamburg Rules, the Collision Convention, the Salvage Convention and the Athens Convention and its London 2002 Protocol.
One of the main objectives of the TCC is to bring the requirements for arresting ships in Turkey in to line with the International Convention on the Arrest of Ships 1999 (the Arrest Convention).
Prior to the TCC, arresting a ship in Turkey had been difficult and the TCC now incorporates the familiar exhaustive list of “maritime claims” for which a ship can now be arrested in Turkey.
However in most cases a Turkish court will still require a claimant to post counter security in the form of a bank guarantee or cash.
Prior to the TCC the Turkish court had discretion to order counter security of between 15% and 40% of the amount of the claim; the TCC now imposes a fixed counter security of 10,000 SDRs regardless of the claim amount but it is open to the parties to apply for and agree more or less countersecurity.
Similarly the TCC allows the parties to agree on the sufficiency, form, nature and amount of the security, which in practice means that club letter of undertaking will be accepted by the Turkish court if the parties agree, although a club letter still cannot be imposed upon the claimant.
There may still be unavoidable delays in lifting an arrest; the new TCC still requires the local court where the ship was arrested to issue a release order and many such local courts lack experience in maritime matters.
The new TCC was introduced to address general dissatisfaction with the lack of uniformity in the previous legislation.
Only time will tell whether it successfully addresses the problems but it should at least bring Turkish maritime law more in line with maritime law in states which are parties to the Arrest Convention and other International Maritime Conventions.
The club welcomes more uniformity in maritime law as this avoids uncertainty and expensive litigation but members are advised to seek advice from their usual Turkish legal advisers, or their usual club contact, if they are in doubt about how the new TCC affects their operations.