Turkey

TURKEY

Agency law in Turkey is governed by the Turkish Commercial Code which came into force on 1 January 1957. 

The Turkish Draft Commercial Code was submitted to the Turkish Parliament on 9 November 2005.  The Draft Code is expected to become law in the near future and is anticipated to strengthen the status of commercial agents.

Definitions
A commercial agent negotiates transactions by acting as an intermediary in agreements for a principal, or concludes agreements on behalf of a principal on a continuous and contractual basis. 

There is no specific statutory definition of a principal in Turkish law.

Neither the Commercial Code nor the Draft Code limits the definition to the selling of or purchasing of goods.  However, the statutory provisions do not state that the definition includes services as well.  Both the current Commercial Code and the Draft Code use the wording “making transactions” and making “agreements”, as opposed to referring to goods and services. 
  
Exclusions
The Turkish Commercial Code permits the agent and principal to contract out of certain provisions.  As such certain statutory provisions can be overridden by the contract itself.  There also exist mandatory provisions to protect the position of the agent. 

The Turkish Commercial Code includes agents whose agency activities are secondary (i.e. their activities are not the primary purpose of their agreement with the principal.)   

Termination
An indefinite term contract can be terminated by the giving of a three months’ statutory notice .  All notices must be given in writing and delivered through registered mail or a public notary.  If there exists a just cause for termination, notice can be given without observing the three months’ notice period.

Both agent and principal are entitled to receive damages if termination is made in the absence of a just cause or without regard to the three months’ notice period.

Damages are calculated according to the loss arising from not concluding the transactions which were started before termination, or which will start within a reasonable time of termination.   

If the agency contract is terminated due to death, bankruptcy or court order, compensation is calculated at the average fee which would be paid to the agent if the transactions were concluded.  

Commission
Under Turkish law a terminated agent is entitled to the following commission:

Back commission, i.e. commission on orders obtained by the agent and accepted by the principal, but where the customer does not pay the principal in respect of the order for a reason for which the principal is to blame (for example, delivery of defective goods). This right arises both during and after termination of the agency contract.

Under the Turkish Commercial Code an agent is entitled to neither pre-termination commission nor post-termination commission. 

The Draft Code is expected to entitle the agent to post-termination commission.  The Draft Code provides for a terminated agent to receive commission for transactions attributable to work done by the agent during the agency agreement and which are entered into within a reasonable period after termination.   

Miscellaneous
The agent can assign his rights and duties under his agency agreement provided that the principal has given written consent.

The parties are able to choose the proper law and forum of the contract. Accordingly, provisions in an agency agreement stipulating that English law is to govern the contract (and that English courts are to have jurisdiction) are likely to be given effect.

The Draft Code brings Turkish law into conformity with contemporary commercial applications and, in large part with the European Union law. 
  
agentlaw.co.uk would like to thank Bati Lawyers and Advisers for its contribution to this section.