Contrary to the general rule, in the absence of a commercial provision or contractual provision that can be applied to a dispute between traders, the Court may resolve the dispute by determining the commercial custom and practice that is appropriate to the requirements of commercial life. In this case, the commercial custom and practice identified (as a legal rule) are “always” applied to traders. Traders cannot avoid liability by claiming that they were unaware of this rule.
The relevant provision of the law is as follows: “In commercial matters where there is no commercial provision, the court shall decide in accordance with commercial customs and practices, and failing that, in accordance with general provisions (see Article 1/2 of Turkish Commercial Code No. 6102).”
Commercial provisions are regulated not only in the Turkish Commercial Code, but also in special laws that deal with new concepts and institutions related to the rapidly developing commercial life, as well as in well-known laws such as the Civil Code and the Code of Obligations (e.g. Financial Leasing Law, Banking Law). It is possible to come across commercial provisions in many different special and public law statutes.
To be considered a commercial provision, this provision must be related to a commercial enterprise. In the event that there is a regulation that can be applied to a commercial enterprise, the Court will undoubtedly refer to this regulation first, provided that it is related to a commercial enterprise. However, in the face of the principles of speed, security, and convenience required by commercial life, it is impossible to talk about a commercial provision that can be applied to every complex commercial transaction. The aim is to provide traders with quick solutions by approaching disputes from the most accurate side and to ensure the smooth functioning of commercial life, in other words, the economic order.
For this reason, the Legislator, in commercial matters where there is no commercial provision, has given priority to commercial customs and practices over general provisions. This exception in the normal hierarchy has brought about the need for legal professionals to have more detailed information about commercial customs and practices. Commercial customs and practices, which may have different appearances according to each region, may indicate quite deviant points from the usual general legal rules. This situation undoubtedly emphasizes the content (substance/work) rather than the form (rule/law).
Article 12/1-(f) and 17/e of Law No. 5174 on the Union of Chambers and Commodity Exchanges of Turkey and Chambers and Commodity Exchanges have imposed duties on the chambers of commerce and industry, trade chambers, industrial chambers, and maritime chambers to determine commercial customs and practices in the working areas of chambers and submit them to the Ministry of Commerce for approval and announcement. A similar duty has also been given to the Justice Ministry Education Department Presidency by Article 50 of the Presidential Decree No. 1 on the Presidential Organization. Thus, in commercial matters where there is no commercial provision, the Court will apply to these chambers or the Ministry of Justice Education Department Presidency to learn about a commercial custom in a subject.
The relevant mandatory provision of the Turkish Commercial Code has imposed the obligation on the Court to conduct research and implementation in this regard ex officio. Although there are two different opinions in the doctrine and judicial decisions on whether the answer given by the chambers or the relevant unit of the ministry will bind the legal judge and whether it will be the basis for the verdict, the general practice is for the judge to make a decision based on the answer received from the chambers.
The commercial customs and practices of each region may be different. If the parties are not in the same region, the commercial customs and practices (legal rule) at the place of performance are applied unless otherwise stipulated in the law or contract. Another important point is that whether or not there is a commercial provision, if there is a contractual provision between the parties on a subject, in this case, the commercial custom and practice rule is not applied, and the contractual provision between the parties is applied.
It is also necessary to mention the important exception brought by Article 1451/1 of the Turkish Commercial Code regarding insurance contracts. According to this provision: “In cases where there is no provision in this Law, the provisions of the Turkish Code of Obligations shall apply to insurance contracts.” It can be seen that in cases where there is no provision in the Turkish Commercial Code regarding insurance contracts, the provisions of the Code of Obligations will apply directly, regardless of whether commercial customs and practices exist or not.
Finally, it should be noted that an important consequence of being a merchant is that commercial customs and practices will be applied to them (whether they know it or not). Therefore, a merchant cannot demand that a custom or practice rule in their region or place of performance not be applied, and they will be subject to the application of a custom or practice rule as a legal rule “definitely”.
The existence of such an important exception in the hierarchy of norms places significant responsibilities on the merchant and/or their representative. Firstly, before and during litigation, it is to review the legal and appropriateness of the custom or practice rule that is likely to be applied. That is to say, for a custom or practice rule to be accepted as a legal rule and applied to commercial disputes, the presence of elements such as continuity, general belief (opinio necessitatis), and legal element (sanctioning power) are necessary. The absence of one of these elements (for example, if the relevant custom or practice rule is not reinforced by the sanctioning power of the state), will render the relevant custom or practice rule inapplicable. Another important task of the merchant and/or their representative is to review whether the court has applied to the correct institutions for the determination of the relevant custom or practice rule, to accurately determine the scope of this application, and ultimately to ensure that the rule to be determined is questioned and scrutinized by third-party experts or institutions.
References:
Kaya A., Turkish Commercial Code and Law on the Entry into Force and Implementation of the Turkish Commercial Code, 2nd Edition, Istanbul, 2021
Ülgen H., Helvacı M., Kaya A., Ertan N.F.N., Commercial Enterprise Law, 6th Edition, Istanbul, 2019
Reha P., Hamdi Y., Commercial Enterprise Law, 17th Edition, Istanbul, 2018
Yaşar K., Commercial Law 1. Introduction – Commercial Enterprise, 3rd Edition, Ankara, 1968
Sabih A., Commercial Enterprise Law, 24th Edition, Ankara, 2018
Decision of the 11th Civil Chamber of the Court of Cassation dated 13.10.1981 and numbered 3534/4204
Decision of the 12th Civil Chamber of the Court of Cassation dated 24.9.2001 and numbered E.2001/13178, K. 2001/14516.