Enforcement Proceedings in Türkiye Against a Debtor Located Abroad

Applying for Enforcement Proceedings in Türkiye for the Collection of International Debts

Today, the establishment of legal and commercial relationships between individuals and companies and different countries has led to an increase in cross-border debt relationships. With the development of international trade, the widespread use of online transactions, and people increasingly residing in different countries, situations where a creditor's debtor is located in another country are frequently encountered.

When an individual or company residing in Türkiye has a receivable from a natural or legal person located abroad, an important question arises: Can enforcement proceedings be initiated in Türkiye against the debtor residing abroad?

The answer to this question depends on the source of the debt, the debtor's connection to Türkiye, the nature of the claim, and the objective sought through the collection process.

In Türkiye, it is not always a requirement for the debtor to reside in Türkiye in order to initiate debt collection proceedings. However, the debtor's assets, receivables, or economic connections located in Türkiye are of great importance for the effectiveness of debt collection procedures conducted in Türkiye.

In international debt collection, the goal is not merely to create an enforcement file, but to ensure the actual collection of the debt. Therefore, a thorough analysis of the legal and economic situation is necessary before initiating collection proceedings.

Can legal proceedings be initiated in Türkiye against a debtor living abroad?

It is possible in some cases to initiate debt collection proceedings in Türkiye against a debtor residing abroad. In Turkish debt collection law, the debtor's presence abroad alone does not fundamentally prevent the initiation of proceedings in Türkiye.

Especially the debtor;

• Owning real estate in Türkiye,
• having bank accounts,
• Having a connection with a company operating in Türkiye,
• Having a regular income from Türkiye,
• Having receivables from third parties located in Türkiye

In such cases, enforcement proceedings can be initiated in Türkiye.

However, an important distinction must be made here. Enforcement proceedings initiated in Türkiye, as a rule, only produce results within Turkey's borders. It is not possible to directly seize assets located in another country. The power of compulsory enforcement is limited to the sovereign territories of states. Therefore, if the debtor only has assets abroad, different legal methods must be considered.

How to Serve a Payment Order to a Debtor Abroad?

When debt collection proceedings are initiated in Türkiye against a debtor residing abroad, one of the most crucial steps is delivering the payment order to the debtor.

In debt collection proceedings, the debtor must be aware of the proceedings and be able to exercise their right to object. Therefore, proper service of the payment order is crucial.

If the debtor's address is abroad, notification procedures are carried out in accordance with international notification rules. Notifications can be made to addresses in foreign countries in accordance with international agreements to which Türkiye is a party and the relevant legislation.

Delays in the notification process are a common problem in international debt collection. Incomplete address information, differences in notification procedures in foreign countries, or lengthy official correspondence can all prolong the collection process.

Therefore, accurately determining the debtor's current address information before initiating collection proceedings is crucial.

What enforcement procedures can be used against a person residing abroad?

The method of enforcement against a debtor located abroad varies depending on the nature of the debt.

Execution Proceedings Without a Court Order

In cases where the creditor does not have a court order, enforcement proceedings without a judgment can be initiated through general attachment.

For example;

• unpaid trade receivables
• debts arising from the contract,
• Loaned money,
• service fees

This can be investigated within this context.

If the debtor does not object to the payment order, the enforcement proceedings may become final. However, if the debtor objects, the proceedings are suspended, and the creditor may need to pursue legal avenues such as having the objection dismissed or annulled.

Jurisdiction Issues in Enforcement Proceedings Without a Court Order

For debtors residing abroad, determining the competent enforcement office is crucial. The nature of the debt, contractual provisions, and statutory jurisdiction rules are considered in the assessment of jurisdiction.

In particular, with monetary debts, the place of performance and the characteristics of the legal relationship between the parties can be important. In the practice of the Supreme Court of Appeals, when evaluating jurisdiction in enforcement proceedings, the nature of the debt and the relevant jurisdictional rules are considered together.

Enforcement Proceedings Based on a Court Order

If the creditor possesses a final court judgment, they can resort to enforcement proceedings based on that judgment.

For example;

• A court ruling in Türkiye,
• A foreign court judgment that has been recognized or enforced in Türkiye,
• an enforceable arbitration award

This could be important in terms of enforcement proceedings.

In international disputes in particular, the recognition and enforcement process may need to be completed before foreign court judgments can be enforced in Türkiye.

Seizure of Assets Located in Türkiye by a Debtor Abroad

The most significant advantage of debt collection proceedings in Türkiye is that action can be taken against the debtor's assets located within Türkiye.

The debtor's;

• Bank accounts in Türkiye,
• immovable properties,
• vehicles,
• company shares
• rights and receivables from third parties

This can be considered within the scope of enforcement proceedings.

For example, if a person living in Germany owns real estate or has a bank account in Türkiye, these assets may be subject to seizure as a result of enforcement proceedings initiated in Türkiye.

However, assets belonging to a debtor located solely in Germany, France, America, or another country cannot be directly seized through an enforcement file in Türkiye. In such cases, the legal system of the relevant country must be utilized.

In international enforcement proceedings, the fundamental issue is not merely the existence of a legal right, but also in which country and by what methods that right can be actually enforced.

What can be done if the debtor has no assets in Türkiye?

Initiating debt collection proceedings in Türkiye against a debtor residing abroad does not always guarantee collection. The primary goal of debt collection is to physically collect the debt by accessing the debtor's attachable assets.

If the debtor has no assets, bank accounts, real estate, or economic ties in Türkiye, the likelihood of successful enforcement proceedings in Türkiye may decrease.

In this situation, the creditor has several legal options. One of them is to initiate direct enforcement proceedings in the country where the debtor's assets are located.

For example;

• A debtor residing in Germany and owning assets solely in Germany,
• A company operating in the United States,
• A commercial enterprise based in France

In this regard, it may be necessary to proceed through the enforcement system of the relevant country.

One of the most important aspects of international debt collection is identifying the right country and the right legal method. Initiating legal proceedings or enforcement actions solely in Türkiye may not always be effective if the debtor's assets are located in another country.

Should debt collection proceedings be initiated abroad or in Türkiye?

One of the frequently asked questions in international debt collection is in which country it is most advantageous to pursue the collection process.

The answer to this question depends on the specifics of the case.

The following points should be particularly considered during the evaluation:

• Debtor's place of residence,
• The country where the debtor's assets are located,
• The authorization terms specified in the contract,
• The applicable law,
• The nature of the receivable,
• The effectiveness of the enforcement system in the country being monitored.

For example, if the debtor owns real estate in Türkiye, initiating enforcement proceedings in Türkiye may yield faster and more effective results. However, if all of the debtor's assets are in another country, it may be more appropriate to utilize the enforcement mechanisms of that country.

Therefore, in international debt collection, it is necessary to focus not only on the legal right but also on the collectibility.

Enforcement of Foreign Court Judgments in Türkiye

In some cases, a creditor may have obtained a court judgment by filing a lawsuit in a foreign country. However, a judgment rendered by a foreign court cannot be directly enforced in Türkiye.

For foreign court judgments to be effective in Türkiye, they must go through a recognition or enforcement process, depending on the nature of the judgment.

Especially;

• Debt collection decisions made in foreign countries,
• compensation provisions
• decisions regarding commercial disputes,
• payment obligations arising from the contract

If the enforcement of the law is desired in Türkiye, the enforcement process may come into play.

Once an enforcement decision is made, the foreign court judgment becomes enforceable under Turkish law, and the creditor can initiate enforcement proceedings in Türkiye.

This is particularly important in international commercial relations, because a lawsuit won in another country only gains economic value if the decision is enforceable.

Enforcement Proceedings in Türkiye Against Companies Located Abroad

In international trade, it is quite common for the debtor to be a foreign company rather than an individual.

For example, a company operating in Türkiye;

• from a foreign supplier,
• from the distributor,
• from the service provider,
• from investment partner

They may be a creditor.

If a foreign company has a branch, representative office, or assets in Türkiye, it is possible to initiate enforcement proceedings in Türkiye.

However, if the foreign company has no connection whatsoever with Türkiye, the monitoring strategy needs to be re-evaluated.

The following issues are particularly important when it comes to company debt:

• the registered office of the company,
• countries in which it operates
• bank accounts,
• affiliates
• commercial connections.

In international corporate debt cases, simply looking at the debtor's official headquarters may not be sufficient. The company's actual operations and assets should also be investigated.

Notification Issues in International Receivables

One of the most common problems in debt collection proceedings against debtors abroad is notification.

In enforcement proceedings initiated in Türkiye, the payment order must reach the debtor in accordance with proper procedure. However, if the debtor is located abroad, different procedures may apply compared to the classic notification process.

Problems that may be encountered during the notification process include the following:

• The debtor's address is unknown
• providing an incorrect address,
• the fact that the notification rules of the foreign country are different,
• Translation and procedural deficiencies.

Therefore, in international investigations, address verification and the correct execution of official procedures are of great importance.

Improperly served notifications can lead to disputes in follow-up procedures at later stages.

Enforcement Proceedings Based on a Negotiable Instrument Against a Debtor Abroad

When pursuing legal action against a debtor located abroad, basing the debt on a negotiable instrument can provide significant advantages for the creditor.

Negotiable instruments such as checks, promissory notes, or bills of exchange may be subject to special collection procedures if they meet certain conditions.

For example;

• bonds issued in foreign currency,
• checks used in international commercial relations
• bills of exchange containing a payment commitment

These documents may be important in debt collection.

However, formal requirements are extremely important for negotiable instruments. The validity of the instrument, signatures, maturity information, and mandatory elements must be carefully examined.

An incomplete or incorrectly issued bill of exchange can eliminate the expected enforcement advantage.

Why is Planning Important in International Debt Collection?

Enforcement proceedings against a debtor abroad often only come into play after the debt has arisen. However, in international commercial relations, the most important thing is to take measures to reduce collection risks from the very beginning.

Especially in commercial contracts;

• determining the competent court
• selection of the applicable law,
• Clearly defined payment terms,
• obtaining collateral
• Evaluating the arbitration option

It can reduce potential problems that may arise in the future.

The collectibility of a debt depends not only on obtaining a court order, but also on the enforceability of that order.

Therefore, in international debt relationships, legal planning is one of the most important steps in securing the debt.

Determining the Right Legal Course of Action in Collecting International Debts

Debt collection proceedings against a debtor located abroad require a different approach than traditional debt collection procedures. This is because, in international debt cases, not only the existence of the debt but also the country and method of collection are crucial.

The first questions a creditor should answer are:

• In which country are the debtor's assets located?
• In Türkiye, is initiating debt collection proceedings economically beneficial?
• In which country is it easier to reach the debtor?
• In which countries can this decision be implemented?
• What will be the cost and duration of the follow-up process?

Investigations initiated without accurate answers to these questions can lead to wasted time and unnecessary expenses.

Achieving successful results in international debt collection requires a combined assessment of both legal processes and economic realities.

Accessing the Debtor's Assets Abroad

Enforcement proceedings initiated in Türkiye primarily affect assets located within Turkey's borders. Turkish enforcement authorities cannot directly take action against a debtor's real estate, bank account, or commercial assets located in another country.

Therefore, if the debtor's assets are entirely located abroad, different methods need to be considered.

These include:

• filing a lawsuit directly in the relevant country,
• initiating enforcement proceedings in a foreign country,
• Recognition in foreign countries of decisions made in Türkiye,
• benefiting from international agreements

Such methods can be found.

Since each country has a different enforcement system, the method to be applied may also vary from country to country. While some facilitating mechanisms may be available in European countries, some countries may also require support from local law.

Therefore, in international debt collection processes, not only Turkish law but also the law of the debtor's country must be taken into consideration.

Jurisdiction and Applicable Law in Cases Filed Against Debtors Abroad

One of the key issues in international disputes is determining which country's courts have jurisdiction.

In most cases, contracts between parties include:

• which court has jurisdiction
• which country's laws will apply,
• how to resolve the dispute

It can be edited.

For example, a contract between a company located in Türkiye and a company located in Italy might stipulate that Turkish courts have jurisdiction.

Conversely, some contracts may prefer foreign courts or arbitration centers.

Therefore, in international commercial relations, the contract phase is of great importance in terms of preventing future collection problems.

Making the wrong choice regarding jurisdiction can lead to lengthy and costly processes for the creditor.

The Difference Between Arbitration Awards and Foreign Court Decisions

In international commercial relations, parties often prefer arbitration to state courts.

Arbitration is used as a swift and expert-led method of resolving disputes, particularly in international commercial disputes.

There are significant differences between an arbitration award and a foreign court judgment.

While recognition and enforcement processes are generally required for foreign court judgments to be enforceable in Türkiye, different international rules may apply to the enforcement of foreign arbitration awards.

For companies engaged in international trade in particular, adding an arbitration clause to contracts can be an important legal tool that facilitates easier future debt collection.

Errors in Practice Regarding Enforcement Proceedings Against Debtors Abroad

In international debt collection proceedings, certain errors can complicate the collection process, even when the creditor is in the right.

The most common mistakes are:

Failure to Investigate the Debtor's Assets

In some cases, the creditor focuses solely on the debtor's address but does not conduct an asset search.

However, the purpose of debt collection proceedings is to access the debtor's assets. Therefore, it is important to assess the debtor's economic situation before initiating the proceedings.

Initiating Proceedings in the Wrong Country

Initiating legal proceedings in a country where the debtor has no assets can prolong the process and increase costs.

When selecting the country to pursue collection, the likelihood of debt collection should be considered.

Ignoring the Notification Process

Failure to comply with procedural rules in serving notices abroad may lead to disputes regarding the invalidity of the enforcement proceedings.

Therefore, international service of process procedures must be carried out carefully.

The Contract Terms Are Not Clear Enough

In commercial transactions in particular, payment terms, the competent court, and the applicable law should be clearly defined.

Vague contracts can create serious problems during the debt collection process.

Things to Consider When Initiating Enforcement Proceedings in Türkiye Against a Debtor Located Abroad

If legal action is to be taken in Türkiye against a debtor located abroad, the following points are particularly important:

• The legal basis for the claim must be correctly determined.
• The debtor's assets in Türkiye should be investigated.
• The correct type of monitoring must be selected.
• Notification procedures must be carried out in accordance with the proper method.
• The validity and translations of foreign documents should be checked.
• If necessary, support should be sought from the laws of foreign countries.

Success in international debt collection depends not only on legal knowledge but also on establishing the right strategy.

Outcome Regarding Enforcement Proceedings in Türkiye Against a Debtor Abroad

In today's increasingly interconnected global economy, debt relationships are no longer confined to a single country's borders. Individuals and companies conduct business in different countries, resulting in international credit and debt relationships.

While it is possible in some cases to initiate debt collection proceedings in Türkiye against a debtor residing or operating abroad, the success of the process requires a comprehensive consideration of numerous legal and practical factors.

The debtor's assets located in Türkiye, the choice of collection method, notification procedures, the use of foreign court orders, and international collection methods constitute the fundamental elements of this process.

What matters is not just being rightfully entitled to a debt, but making that debt actually collectible.

Therefore, enforcement proceedings against a debtor abroad, unlike classic enforcement procedures, constitute a specialized field requiring a combined approach to international law, enforcement law, and strategic planning.

A properly conducted debt collection process can help overcome legal obstacles between different countries and enable creditors to more effectively access their rights.