Originally from Arbitration Law of Turkey: Practice and Procedure

CHAPTER 23

CORPORATE ARBITRATION INVOLVING TURKEY

International merger and acquisitions of companies require international contracts that very often contain arbitration clauses. Corporate arbitration is all about getting the dispute solved expediently and economically so that all parties can get back to the commercial business that they are in and the dispute will have as small an impact on the parties businesses as possible. Arbitration offers great advantages to the business world. Neutrality, confidentiality, speed and having a tailor made solution rendered by experts are some of the advantages that arbitration offers. As a result, companies, directors and shareholders of companies are becoming more and more interested in the swift and confidential settlement of disputes that arbitration can offer in this field1.

One should note that arbitrating corporate disputes is different to other dispute resolution methods, such as resolution by expert opinion or mediation that are also often referred to in corporate law. In the context of an expert evaluation, the parties will transfer their files to a third party or third parties, generally identified as experts, who have been chosen on the basis of their particular technical and sometimes managerial competence. The intention is not for the expert to resolve the legal dispute per se, but rather for the expert to formulate an assessment or financial consideration that the parties can then undertake as their strategy to resolve the dispute. The difference between these methods and arbitration essentially lies in the fact that in expert evaluation or mediation, principally there are no proceedings similar to a trial concluding with an award and therefore it is not an arbitration. In addition, once the arbitration has been agreed upon and is under way, its result is binding on the parties, the execution of which is therefore mandatory. This is not the case for expert evaluation or mediation, which remains binding on the parties to the extent that an expert evaluation signed and accepted by both parties constitutes a contract between them, but does not constitute a decision or an award that carries the value of a judgment that may be enforced through the existing international conventions.