The Role of the Istanbul Arbitration Centre (ISTAC) in Maritime Trade Disputes

ENTRANCE

Maritime trade, by its very nature, is a transboundary field fraught with technical and specialized disputes. Disputes arising from freight transportation, ship management, and port services require a rapid, economical, and specialized dispute resolution mechanism. In this context arbitrationhas become one of the most frequently used dispute resolution methods in the maritime sector.

Arbitration proceedings in Turkey are developing at both national and international levels, and one of the institutions providing services in this field the Istanbul Arbitration Centre (ISTAC). Established in 2015, ISTAC is an independent and modern arbitration centre poised to play an active role in resolving maritime trade disputes.

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I. THE STRUCTURE OF MARITIME TRADE DISPUTES

1. Types of Disputes

The main disputes subject to arbitration in maritime trade are as follows:

• Claims and delays arising from freight contracts,

• Loss or damage to cargo due to a bill of lading,

• Shipbuilding and repair contracts,

• Charter agreement (ship chartering) disputes,

• Disputes arising from port service contracts,

• Maritime incidents such as salvage, collision, and general average.

Arbitration is often preferred over litigation because these disputes typically require technical expertise, quick decision-making, and cost-effectiveness.

2. Reasons for Choosing Arbitration

• Evaluation by an expert panel of judges,

• Flexibility in terms of time and procedure,

• Compliance with the parties' request for confidentiality protection,

• Arbitration awards are easier to enforce under the New York Convention compared to the recognition of foreign court judgments.

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II. ISTANBUL ARBITRATION CENTER (ISTAC)

1. Establishment and Purpose

The Istanbul Arbitration Center, established under Law No. 6570, is an independent and impartial center in the field of arbitration and alternative dispute resolution methods. Its aim is fast, economical, and reliable platform for resolving national and international commercial disputes.

2. Organizational Structure

ISTAC consists of the following units:

• Board of Directors

• Arbitration Tribunal

• Secretariat

• List of referees

ISTAC also creates lists of expert arbitrators in the field of maritime trade to develop a pool of arbitrators specifically for the maritime sector and to provide expertise in this area

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III. Maritime Trade Arbitration at ISTAC

1. ISTAC Arbitration Rules and Practice

The ISTAC Arbitration Rules offer parties broad freedom of contract. The following arbitration clause is recommended for use in maritime trade contracts:

“Any dispute arising from this agreement shall be resolved definitively and bindingly by arbitration in accordance with the Arbitration Rules of the Istanbul Arbitration Centre. Number of arbitrators: … / Language: … / Place of dispute resolution: Istanbul.”

2. Specialized Refereeing

The technical nature of disputes specific to maritime trade necessitates the involvement of arbitrators with expertise in the field . The arbitrators within ISTAC consist of both maritime law academics and expert lawyers with many years of practical experience

3. Emergency Arbitrator and Expedited Procedure

• Emergency Arbitrator system, requests for urgent measures, such as ship detention or cargo delivery, can be resolved quickly.

• The Expedited Arbitration Procedureoffers cost and time advantages, particularly for low-value maritime claims.

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IV. JUDICIAL PROCEDURE AND ENFORCEMENT

1. Recognition of Arbitration Awards

Arbitration awards issued by ISTAC are binding under the International Arbitration Law No. 4686 or the Turkish Code of Civil Procedure. Parties may request the annulment of an arbitration award only under limited circumstances (e.g., violation of public order).

2. Enforcement in Foreign Countries

ISTAC decisions in countries that are parties to the New York Convention . This clearly demonstrates that ISTAC offers international validity to the maritime sector.

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V. APPLICATION EXAMPLES AND DEVELOPMENTS

1. Local Disputes

For domestic disputes arising from loading, unloading, or bills of lading at Turkish ports, ISTAC offers a significant advantage. If the parties are resident in Türkiye and the contract includes an arbitration clause, proceedings can be initiated before ISTAC.

2. ISTAC & BIMCO Collaborations

ISTAC standard maritime trade agreements such as BIMCO . This would allow Turkish parties to choose Istanbul as an alternative to London arbitration.

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VI. CRITICISMS AND SUGGESTIONS

1. Lack of Awareness

Most Turkish maritime companies still prefer foreign arbitration centers such as LMAA. This is due to ISTAC's lack of promotion.

2. Recommendations

• ISTAC should establish a "maritime arbitration chamber" in the field of maritime trade.

• In collaboration with universities and bar associations, sector-specific arbitration training programs should be organized.

• The advantages of lower costs, faster processes, and local expertise compared to foreign arbitration centers should be promoted more effectively.

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CONCLUSION

The Istanbul Arbitration Centre (ISTAC) aims to become a local and regional arbitration hub for resolving maritime trade disputes . With its rules aligned with international standards, expert arbitrators, and expedited proceedings, ISTAC offers the Turkish maritime sector an economical, fast, and effective dispute resolution option.

Particularly with Istanbul's vision of becoming a logistics hub, ISTAC's active role in maritime law disputes will also increase Türkiye's potential for exporting legal expertise.