How Do Legal Advisors Support Companies During Regulatory Investigations and Disputes in Turkiye?
Running a business in Türkiye comes with opportunities, but it also brings legal responsibilities that cannot be overlooked. Companies must comply with Turkish legislation, maintain appropriate corporate records, meet regulatory requirements and manage their relationships with employees, customers, suppliers and public authorities.
For businesses operating in Istanbul, these responsibilities can become particularly demanding. As one of Türkiye's major commercial and financial centers, Istanbul is home to multinational corporations, financial institutions, manufacturers, technology businesses, shipping companies, real estate investors and international trading organizations.
Each operates within its own regulatory environment.
A company may have an established compliance program and still receive a request for information from a government authority. A routine tax examination may reveal accounting discrepancies. An employee complaint may develop into a workplace investigation. A commercial disagreement may eventually involve allegations of unfair competition or breach of contractual obligations.
These situations can be stressful, particularly when management is unfamiliar with the legal procedures involved.
Questions often arise immediately:
Does the company have to provide every document requested?
Can regulatory officials inspect its premises?
What happens if an investigation results in an administrative fine?
Can the company challenge a decision it considers unlawful?
Are directors or managers personally responsible?
How can the business protect its operations while an investigation is ongoing?
This is where legal advisors make a real difference.
Their role is not simply to appear in court when a dispute becomes serious. They help businesses understand what is happening, identify their legal responsibilities, preserve important evidence, communicate with regulatory authorities and decide how best to protect their interests.
For international companies, the picture can be more complicated. A regulatory investigation in Türkiye may affect an overseas parent company, international shareholders, group reporting arrangements, commercial contracts and business relationships in other countries.
At Kurucuk & Associates, a law firm based in Istanbul, we understand that businesses need practical legal advice that considers both the law and the realities of running a company.
This article examines how legal advisors support businesses during regulatory investigations and disputes in Türkiye, the legislation that may apply, the responsibilities of relevant authorities and the legal options available to companies.
1. Understanding Regulatory Investigations and Corporate Disputes in Türkiye
The first thing to understand is that not every regulatory inquiry is an allegation of wrongdoing.
Sometimes an authority simply needs information to verify whether a company is complying with its legal obligations. In other situations, it may be examining a suspected violation or investigating a formal complaint.
A corporate dispute is somewhat different. It may arise between a company and a public authority, or between shareholders, business partners, employees, suppliers and customers.
However, these matters can overlap.
For example, a disagreement between shareholders may reveal concerns about corporate governance. A complaint from an employee may lead to an investigation by the labor authorities. A competition law investigation may also expose contractual arrangements that need to be reviewed.
Understanding the nature of the matter is therefore the starting point for any effective legal response.
1.1 What types of investigations can businesses face?
Companies operating in Istanbul and elsewhere in Türkiye may encounter investigations involving several areas of law.
Area of law | Examples of potential issues |
Competition law | Price-fixing, restrictive agreements and abuse of dominance |
Tax law | Undeclared income, VAT discrepancies and corporate tax assessments |
Personal data protection | Data breaches and unlawful processing of personal information |
Employment law | Unlawful dismissal, workplace complaints and employee entitlements |
Banking and finance | Regulatory reporting, licensing and internal control failures |
Capital markets | Disclosure violations and market manipulation |
Anti-money laundering | Suspicious transactions and inadequate customer due diligence |
Consumer protection | Misleading advertising and unfair commercial practices |
Environmental law | Pollution, waste management and environmental permits |
Corporate governance | Shareholder disagreements and directors' responsibilities |
The applicable rules depend on the company's activities and the nature of the alleged violation.
1.2 Which authorities may investigate a company?
Several Turkish public institutions have powers to supervise businesses and investigate matters falling within their statutory responsibilities.
Some of the authorities companies may encounter include:
Turkish Competition Authority (Rekabet Kurumu): Investigates competition-related matters under Law No. 4054.
Personal Data Protection Authority (KVKK): Supervises compliance with Personal Data Protection Law No. 6698.
Revenue Administration (Gelir İdaresi Başkanlığı): Administers tax obligations and related procedures.
Tax Inspection Board (Vergi Denetim Kurulu): Conducts tax inspections.
Banking Regulation and Supervision Agency (BDDK): Supervises banking activities and relevant financial institutions.
Capital Markets Board (SPK): Regulates and supervises capital markets.
Financial Crimes Investigation Board (MASAK): Performs functions relating to the prevention of money laundering and terrorist financing.
Ministry of Labour and Social Security: Oversees relevant employment and occupational health and safety matters.
Each institution has different responsibilities and statutory powers. A company should therefore understand exactly which authority is involved before deciding how to respond.
2. What Does a Legal Advisor Do When a Company Comes Under Investigation?
Receiving an official investigation notice can leave management uncertain about what to do first.
Some companies immediately begin collecting documents. Others ask their finance or HR departments to prepare an explanation. Although these steps may eventually be necessary, responding without first understanding the legal position can create avoidable difficulties.
A legal advisor helps bring structure to the situation.
2.1 Reviewing the official notice
The first step is usually to examine the communication received from the authority.
A lawyer will look at:
Who issued the notice?
Does the authority have jurisdiction over the matter?
Which legislation and provisions are mentioned?
What conduct or transactions are being examined?
Which documents or explanations have been requested?
Is the company being asked to provide information or submit a formal defence?
What is the applicable deadline?
Are there any specific procedural rights or obligations?
These distinctions matter.
For instance, a request for information from the Competition Authority should not automatically be treated as a formal finding that the company has violated competition law.
Likewise, receiving a tax examination notice does not necessarily mean that additional tax is payable.
Legal counsel helps management understand the actual stage of the process and avoid drawing conclusions before the relevant facts have been examined.
2.2 Identifying the company's legal and financial exposure
Once the initial documents have been reviewed, lawyers assess what could happen if the investigation proceeds.
Depending on the circumstances, the consequences may include:
Administrative fines.
Additional tax assessments and penalties.
Restrictions on certain business activities.
License-related consequences.
Compensation claims.
Contractual disputes.
Reputational damage.
Personal liability of directors or managers where the law provides for it.
Criminal proceedings where the facts indicate a potentially criminal offence.
It is important to distinguish between administrative liability and criminal liability. A company being investigated by a regulator does not automatically mean that its directors or employees have committed a criminal offence.
Each person's potential responsibility must be assessed according to the applicable law and the available evidence.
2.3 Preparing a response that makes legal and commercial sense
A good legal response should address the authority's concerns without creating unnecessary problems for the business.
Legal advisors examine the evidence, identify the relevant statutory provisions and determine how the company should respond.
This may involve preparing written explanations, reviewing contracts, analyzing financial records, organizing supporting documents and advising management on possible objections.
The strategy also needs to consider the company's commercial circumstances.
For example, a company may have several ongoing contracts that could be affected by an administrative restriction. A regulatory dispute may also involve an overseas parent company or an important international customer.
These practical considerations should form part of the legal assessment.
3. Protecting Businesses During Regulatory Inspections and Dawn Raids
An unexpected inspection at a company's premises can be one of the most challenging experiences for management.
Imagine that officials arrive at a company's Istanbul headquarters and request access to business records, computers, emails and internal documents.
Employees may not know who should speak to the officials. IT personnel may be unsure which records need to be preserved. Management may worry about confidential commercial information.
In such circumstances, having a clear legal response procedure is extremely important.
3.1 Understanding the authority's inspection powers
The Turkish Competition Authority provides a useful example of how extensive regulatory inspection powers can be.
Under Law No. 4054 on the Protection of Competition:
Article 14 concerns the authority's power to request information.
Article 15 regulates on-site inspections.
Article 16 establishes the framework for administrative fines.
Articles 43–45 address important aspects of investigation and defense procedures.
Article 15 authorizes designated officials to examine books, documents and records, inspect relevant electronic information and request explanations within the statutory framework.
A company should understand that obstructing or hindering a lawful inspection can result in separate administrative consequences.
The Turkish Competition Authority's official legislation resources provide further information about these powers.
3.2 How lawyers assist during an inspection
Legal advisors can coordinate the company's response from the moment officials arrive.
Checking the officials' authority
Lawyers examine the officials' identification and authorization, together with the legal basis and scope of the inspection.
Coordinating communication
A designated company representative should coordinate communication with the officials. Employees should avoid giving speculative answers or making statements about matters they do not understand.
Monitoring document collection
Legal counsel can monitor the documents examined or collected, within the limits of the authority's statutory powers.
This is particularly important where records contain personal information, commercially sensitive material or information relating to other group companies.
Reviewing electronic information
Business emails, digital correspondence, accounting systems and electronic storage may contain relevant evidence.
The company should preserve potentially relevant records and avoid deleting or altering information.
Recording procedural concerns
If there are genuine concerns about the way an inspection is conducted, lawyers can document those concerns and consider the appropriate legal response.
The purpose is not to obstruct a lawful investigation. It is to ensure that the company's rights are respected throughout the process.
3.3 Why employees should know what to do during an inspection
Regulatory officials may first encounter reception staff, IT employees, finance personnel or HR representatives rather than senior management.
That is why inspection-response training should not be limited to directors.
Legal advisors can help companies establish an internal protocol explaining:
Who should be contacted when officials arrive.
Who is authorized to communicate with the authorities.
How employees should respond to questions.
How electronic records should be preserved.
How confidential information should be identified.
How requests for documents should be recorded.
How overseas headquarters should be informed.
A simple, well-understood procedure can prevent confusion at a particularly sensitive moment.
4. Legal Support During Competition Law Investigations
Competition law is an important consideration for companies involved in manufacturing, distribution, retail, technology, financial services and other commercial activities.
Businesses may face scrutiny over pricing arrangements, distribution agreements, information exchanges, mergers or conduct involving a dominant market position.
The principal legislation is Law No. 4054 on the Protection of Competition.
4.1 Important provisions of Competition Law No. 4054
Article 4 – Agreements restricting competition
Article 4 prohibits agreements and concerted practices between undertakings, and decisions of associations of undertakings, that have the object or effect of preventing, restricting or distorting competition.
Examples may include price-fixing, market-sharing and certain restrictive commercial arrangements.
Article 6 – Abuse of dominant position
This provision addresses the abuse of a dominant position in a relevant market.
Importantly, having a dominant market position is not itself unlawful. The legal concern is the abusive use of that position.
Article 7 – Mergers and acquisitions
Article 7 addresses mergers and acquisitions that may significantly impede effective competition.
Legal advisors help businesses determine whether a transaction requires notification and whether clearance is necessary before completion.
Article 15 – On-site inspections
This provision establishes the Competition Authority's on-site inspection powers.
Article 16 – Administrative fines
Article 16 establishes the statutory framework for administrative fines relating to specified competition law violations and procedural infringements.
Articles 43–45 – Investigation and defense procedures
These provisions address important aspects of the investigation process, including evidence collection, the investigation report and written defenses.
Further information is available through the Competition Authority's official legislation page.
4.2 How legal advisors prepare a competition law defense
Consider a distributor in Istanbul that receives a notice concerning alleged coordination of resale prices with other market participants.
The company may believe that its pricing decisions were entirely independent. However, the authority may have obtained emails, meeting records or commercial documents that require explanation.
A legal advisor would examine the actual circumstances rather than immediately accepting or rejecting the allegation.
The review may include:
Distribution and supply agreements.
Internal pricing policies.
Communications with competitors.
Commercial correspondence.
Market conditions.
The company's position in the relevant market.
Evidence supporting the authority's allegations.
The lawyer then evaluates whether the conduct satisfies the legal requirements of the alleged infringement and prepares the company's defense accordingly.
4.3 Written defenses, hearings and settlement
Competition investigations involve formal procedural stages.
Under Article 45 of Law No. 4054, the parties generally have 30 days following notification of the investigation report to submit their written defenses. A statutory extension may be available under the applicable conditions.
Article 46 provides for oral hearings in the circumstances established by law.
Settlement is another possibility.
Under Article 43, eligible parties may pursue a settlement procedure during an investigation. This may provide an opportunity to conclude the matter with a reduction in the administrative fine, subject to the statutory requirements.
However, settlement is not simply a decision about paying a lower fine.
Article 43 provides that parties to a completed settlement cannot bring the settlement provisions and resulting administrative fine before the courts.
For this reason, legal advisors should carefully evaluate the evidence, financial exposure, potential litigation prospects and consequences before recommending settlement.
5. Assistance During Tax Investigations and Disputes
Tax examinations can be particularly demanding because they often involve large volumes of financial information and transactions carried out over several years.
A company may be asked to explain differences between its accounting records and tax declarations, justify certain expenses, provide invoices or clarify transactions involving related companies.
For international businesses, transfer pricing and cross-border transactions may add another layer of complexity.
5.1 Understanding Tax Procedure Law No. 213
Tax Procedure Law No. 213 (Vergi Usul Kanunu) establishes the principal procedural framework for taxation in Türkiye.
Several provisions are especially relevant.
Article 134 – Purpose of tax examination
The purpose of a tax examination is to investigate, determine and ensure the accuracy of taxes payable.
Article 139 – Place of examination
This provision regulates where tax examinations are conducted, including the applicable arrangements for examining documents and records.
Article 140 – Principles governing examinations
Article 140 establishes procedural requirements that tax inspectors must observe during examinations.
Article 3 – Proof in taxation
This provision contains important rules concerning the application and interpretation of tax legislation and the proof of taxable events.
Article 359 – Tax evasion offences
Article 359 addresses specified conduct involving tax evasion, including certain unlawful accounting and documentation practices.
These provisions should be considered alongside the relevant substantive tax legislation.
The Turkish Revenue Administration provides access to tax legislation and official guidance.
5.2 How lawyers assist during a tax examination
Legal advisors work with the company's accounting and finance teams to understand the examination and prepare an appropriate response.
Depending on the matter, this may involve:
Reviewing the examination notification.
Identifying the relevant tax periods.
Examining accounting records.
Reviewing VAT and corporate tax declarations.
Checking invoices, contracts and payment records.
Examining deductible expenses.
Reviewing related-party transactions.
Identifying possible procedural irregularities.
Preparing written explanations.
Assessing potential penalties and litigation options.
The lawyer's role is not to replace the company's accountant or tax specialist. Rather, legal counsel examines the legal implications of the findings and helps ensure that the company's position is properly presented.
5.3 Challenging an assessment or tax penalty
A tax examination may result in additional tax assessments, tax loss penalties or procedural penalties.
A company does not necessarily have to accept an assessment simply because it has been issued by a tax authority.
Legal advisors examine whether the assessment is supported by evidence, whether the relevant legislation has been correctly applied and whether the required procedures have been followed.
Depending on the circumstances, available options may include statutory settlement procedures or proceedings before the competent tax court.
The choice requires careful consideration because certain administrative procedures and settlement arrangements can affect subsequent judicial remedies.
6. Personal Data Protection Investigations and Cybersecurity Incidents
Personal data is now part of almost every company's daily operations.
Businesses collect and process information about customers, employees, suppliers, website visitors and commercial partners.
For multinational corporations, this information may also move between Turkish operations and overseas headquarters.
An employee complaint, a customer request or a cybersecurity incident can therefore create significant legal responsibilities.
6.1 Understanding Personal Data Protection Law No. 6698
Turkish Personal Data Protection Law No. 6698 (Kişisel Verilerin Korunması Kanunu) establishes the main rules governing personal data processing.
The following provisions are particularly relevant.
Article 4 – General principles
Personal data must be processed lawfully and fairly, for specified purposes, accurately and proportionately, and retained only for the period required by the relevant purposes.
Article 5 – Conditions for processing personal data
Article 5 establishes the legal grounds on which personal data may be processed.
Article 6 – Special categories of personal data
This provision establishes additional requirements for processing sensitive personal data.
Article 9 – Transfer of personal data abroad
This article regulates international transfers and establishes the applicable transfer mechanisms.
Article 10 – Obligation to inform
Data controllers must provide individuals with the information required by law about the processing of their personal data.
Article 12 – Data security
Data controllers must take appropriate technical and organizational measures to prevent unlawful processing and access and to ensure the protection of personal data.
Article 15 – Investigation procedure
This provision establishes the Board's investigation powers within the statutory framework.
Article 18 – Misdemeanors
Article 18 addresses administrative sanctions for specified violations.
The Personal Data Protection Authority's official English translation of Law No. 6698 is a useful reference for international companies.
6.2 What happens when a company receives a data protection complaint?
A company may receive a complaint because an individual believes their personal information has been processed unlawfully, disclosed without an appropriate legal basis or retained longer than necessary.
Legal advisors help determine what actually happened and whether the company's practices complied with the legislation.
The review may involve:
Privacy notices.
Data processing inventories.
Employee and customer records.
Contracts with data processors.
International transfer arrangements.
Access logs.
Information security policies.
Data retention procedures.
If deficiencies are identified, legal counsel can coordinate corrective action with management and IT personnel.
6.3 What should a company do following a data breach?
A cyberattack or unauthorized access incident may create immediate reporting and notification responsibilities.
Under Article 12(5) of Law No. 6698, where personal data are obtained by others through unlawful means, the data controller must notify the affected individuals and the Board within the shortest time.
The Personal Data Protection Board's Decision No. 2019/10 established a 72-hour notification approach for qualifying breaches reported to the Board, subject to the relevant circumstances.
Legal advisors help the company determine:
Whether the incident constitutes a personal data breach.
Which information has been affected.
Whether individuals face potential risks.
Whether regulatory notification is required.
What information should be included in the notification.
Whether further protective measures are necessary.
A company should not wait until every technical detail is known before assessing its legal notification obligations.
7. Employment Investigations and Workplace Disputes
Employment-related problems can arise even in well-managed organizations.
An employee may complain about workplace harassment, discrimination, unpaid wages or unfair dismissal. Management may also discover misconduct, unauthorized disclosure of confidential information or violations of internal company policies.
These situations require a careful balance between protecting the company's interests and respecting employee rights.
7.1 Relevant Turkish employment legislation
Several statutes may apply:
Labor Law No. 4857: Governs employment relationships, termination and working conditions.
Turkish Code of Obligations No. 6098: Article 417 addresses the employer's duty to protect the employee's personality and provide an appropriate working environment.
Occupational Health and Safety Law No. 6331: Establishes workplace health and safety responsibilities.
Law No. 7036 on Labor Courts: Regulates labor court proceedings.
Law No. 6356 on Trade Unions and Collective Labor Agreements: Governs trade union rights and collective labor relations.
Official legislative information is available through the Ministry of Labor and Social Security and the Turkish Legislation Information System.
7.2 How lawyers conduct internal workplace investigations
Suppose an employee reports inappropriate conduct by a manager.
The company should not dismiss the complaint without examining it. Equally, it should not immediately impose disciplinary measures before establishing the relevant facts.
Legal advisors can help management conduct a fair and properly documented investigation.
This may involve:
Reviewing the employee's complaint.
Examining relevant employment contracts and workplace policies.
Identifying appropriate investigators.
Preserving relevant correspondence.
Interviewing individuals where appropriate.
Reviewing evidence while respecting privacy rights.
Preparing an internal investigation report.
Advising management on corrective measures.
Confidentiality is particularly important.
For example, examining an employee's emails or workplace communications is not an unlimited employer right. The legal basis, legitimate purpose, necessity, proportionality and relevant information obligations must be considered.
7.3 Representing employers in employment disputes
If an internal investigation develops into a formal dispute, legal counsel may assist with:
Reviewing termination decisions.
Assessing notice and severance obligations.
Responding to employee claims.
Preparing legal submissions.
Participating in mandatory mediation where applicable.
Negotiating settlements.
Representing the employer before the competent labor courts.
Article 3 of Law No. 7036 establishes mandatory mediation as a prerequisite for specified employment claims, subject to statutory exceptions.
Seeking legal advice before dismissing an employee or agreeing to a settlement can help prevent avoidable disputes.
8. Banking, Finance and Capital Markets Investigations
Companies involved in banking and financial services operate under detailed regulatory requirements.
An investigation concerning a financial institution, investment firm or publicly traded company may affect its business activities, reputation and relationships with investors.
8.1 Banking Law No. 5411
Banking Law No. 5411 provides the principal legal framework for banking activities in Türkiye.
The Banking Regulation and Supervision Agency supervises relevant institutions and exercises the powers granted by legislation.
Legal advisors may assist with:
Regulatory inspection responses.
Licensing and authorization matters.
Corporate governance.
Financial reporting.
Internal compliance procedures.
Regulatory correspondence.
Disputes involving supervisory decisions.
The Banking Regulation and Supervision Agency provides official regulatory information and legislation.
8.2 Capital Markets Law No. 6362
Capital Markets Law No. 6362 is particularly relevant to publicly traded companies, investment firms and other capital market participants.
Relevant provisions include:
Article 21: Transfer pricing and disguised profit distribution in the circumstances covered by the provision.
Article 47: Market abuse.
Article 101: Measures relating to capital markets activities.
Article 103: Administrative fines.
Article 104: Market disturbance actions.
Article 107: Insider dealing and market manipulation offences.
Legal advisors can review transaction records, internal communications, corporate disclosures and relevant management decisions before preparing the company's response.
The Capital Markets Board of Türkiye provides official legislation and regulatory information.
8.3 Anti-money laundering obligations
Law No. 5549 on the Prevention of Laundering Proceeds of Crime establishes important obligations for relevant businesses and obliged parties.
Depending on the company's status and activities, these may include customer identification, recordkeeping, suspicious transaction reporting and internal compliance arrangements.
Legal advisors can help review customer due diligence procedures, beneficial ownership information, reporting obligations and responses to lawful information requests.
The Financial Crimes Investigation Board (MASAK) provides further information about Türkiye's anti-money laundering framework.
9. Resolving Corporate and Commercial Disputes
Not every legal dispute begins with a government investigation.
Sometimes the problem is much closer to the company's daily business.
A supplier may fail to deliver goods. A customer may refuse to pay an invoice. Shareholders may disagree about management decisions. A contractual relationship may break down after years of cooperation.
These disputes can become expensive if they are not handled properly.
9.1 Shareholder and management disagreements
Shareholder disputes can affect a company's decision-making, financial stability and long-term business plans.
Common examples include disagreements over:
Management decisions.
Dividend distributions.
Share transfers.
Directors' responsibilities.
Minority shareholder rights.
Related-party transactions.
General assembly resolutions.
The Turkish Commercial Code No. 6102 establishes the main legal framework governing commercial companies.
Some important provisions include:
Article 369 – Duty of care and loyalty
Establishes important duties of board members in joint-stock companies.
Article 391 – Nullity of board resolutions
Addresses certain categories of invalid board resolutions.
Article 445 – Annulment of general assembly resolutions
Provides a legal basis for challenging certain unlawful general assembly resolutions.
Article 553 – Liability of founders, board members and managers
Regulates liability for losses arising from unlawful conduct or breaches of statutory and constitutional obligations, subject to the requirements of the provision.
Article 614 – Shareholders' right to obtain information and examine documents
Provides important information and inspection rights to shareholders of limited liability companies.
Before recommending litigation, legal advisors examine the company's articles of association, shareholder agreements, board minutes and relevant financial records.
9.2 Contractual and commercial disagreements
Commercial disputes frequently arise because one party believes that the other has failed to fulfil its contractual obligations.
Examples include:
Unpaid invoices.
Delayed deliveries.
Breach of distribution agreements.
Construction delays.
Disagreements over service quality.
Contract termination.
Warranty claims.
Contractual penalties.
The Turkish Code of Obligations No. 6098 provides the general legal framework.
Relevant provisions include:
Article 112: Liability arising from failure to perform obligations properly.
Article 117: Default of the debtor.
Article 123: Additional time for performance in specified circumstances.
Article 125: Rights of the creditor following default.
Article 138: Excessive difficulty of performance in exceptional circumstances.
A lawyer will normally begin by examining the contract, correspondence, payment records and evidence of performance.
The objective is to understand what each party was required to do, whether an obligation was breached and what remedies may be available.
9.3 Is court litigation always necessary?
Not necessarily.
Taking a commercial dispute to court may be appropriate in some cases, but it is not always the quickest or most commercially sensible option.
Depending on the circumstances, legal advisors may recommend:
Direct negotiations.
Settlement discussions.
Mediation.
Domestic arbitration.
International arbitration.
Court proceedings.
Law No. 6325 on Mediation in Civil Disputes provides the relevant framework for mediation.
International Arbitration Law No. 4686 may apply to qualifying international arbitration matters. Parties may also agree to institutional arbitration, including proceedings under the rules of the Istanbul Arbitration Centre.
The Istanbul Arbitration Centre (ISTAC) provides information about arbitration and other dispute resolution services.
10. Challenging Unlawful Administrative Decisions
Sometimes a company believes that a regulatory authority has made an incorrect or unlawful decision.
This could involve an administrative fine, a license-related decision, a restriction on business activities or another administrative measure.
The company may have grounds to challenge the decision, but the available remedy depends on the applicable legislation.
10.1 Administrative Judicial Procedure Law No. 2577
Law No. 2577 on Administrative Judicial Procedure (İdari Yargılama Usulü Kanunu) establishes the framework for administrative court proceedings in Türkiye.
Article 2 identifies two important types of administrative action.
Annulment actions (İptal davaları)
These proceedings seek to have an unlawful administrative act set aside.
Full remedy actions (Tam yargı davaları)
These proceedings concern compensation for personal rights directly affected by administrative acts or actions.
10.2 On what grounds can an administrative decision be challenged?
Article 2 of Law No. 2577 recognizes five important elements of administrative legality:
Competence.
Form.
Cause.
Subject matter.
Purpose.
For example, an administrative fine may be challenged if the authority acted outside its legal competence, relied on an incorrect factual basis or misapplied the relevant legislation.
Legal advisors examine the administrative decision, supporting records and relevant statutory provisions before determining whether judicial review is appropriate.
10.3 How much time does a company have to file a case?
Time limits are extremely important.
Under Article 7 of Law No. 2577, the general filing period is:
60 days before administrative courts and the Council of State.
30 days before tax courts.
However, special legislation may provide different deadlines.
Articles 20/A and 20/B also establish expedited judicial procedures for specified categories of administrative disputes.
For this reason, companies should never assume that every administrative decision can be challenged within the same period.
10.4 Can a company request suspension of an administrative decision?
Yes, where the statutory conditions are satisfied.
Article 27 of Law No. 2577 regulates requests for a stay of execution (yürütmenin durdurulması).
This remedy may be important when implementing an administrative decision could cause serious consequences before the court reaches its final decision.
However, suspension is not automatic. The statutory requirements must be established, including the relevant conditions concerning apparent unlawfulness and irreparable or difficult-to-remedy damage.
A lawyer can assess whether such a request is appropriate and prepare the necessary supporting arguments.
11. Internal Corporate Investigations and Evidence Preservation
Sometimes management needs to understand what has happened inside the company before deciding how to respond to a regulatory concern.
For example, allegations may involve financial misconduct, employee fraud, bribery, unauthorized disclosure of information or irregular procurement arrangements.
An internal investigation helps establish the facts and identify whether the company's policies or legal obligations have been breached.
11.1 Why should an internal investigation be properly organized?
An investigation involving senior employees or important commercial transactions should not be handled casually.
Legal advisors can help establish a suitable investigation process by:
Defining the scope of the investigation.
Identifying the responsible investigators.
Assessing possible conflicts of interest.
Identifying relevant employees and departments.
Preserving important records.
Conducting appropriate interviews.
Reviewing financial and electronic evidence.
Preparing a documented report.
Where allegations involve senior management, an independent investigation structure may be more appropriate.
11.2 Preserving electronic and documentary evidence
Evidence can become difficult to rely upon if it is not properly preserved.
Relevant material may include:
Emails and business correspondence.
Commercial contracts.
Accounting records.
Internal approvals.
Board and management minutes.
Payment records.
Relevant digital communications.
Access and audit logs.
Legal advisors may coordinate with forensic IT specialists and accountants to ensure that relevant records are collected and handled appropriately.
11.3 Confidentiality and professional secrecy
Confidentiality is particularly important when an investigation involves sensitive allegations or potential litigation.
Under Article 36 of Attorney-ship Law No. 1136, Turkish lawyers are subject to professional secrecy obligations.
However, companies should not assume that every document labelled confidential or every communication involving an in-house lawyer automatically receives the same protection that may exist under other countries' legal systems.
The legal status of each document and communication should be examined under the applicable Turkish rules.
12. Supporting Multinational Companies During Cross-Border Investigations
For international businesses, a regulatory investigation in Türkiye may involve much more than the Turkish subsidiary.
Consider a company headquartered in Germany with an Istanbul office, overseas shareholders and customers in several countries.
An investigation involving the Turkish operation may require communication with the parent company, preservation of international records and coordination with lawyers in other jurisdictions.
This requires careful planning.
12.1 Managing overlapping legal obligations
Multinational corporations may need to consider Turkish legislation alongside applicable foreign legal requirements.
Examples include:
Turkish Personal Data Protection Law No. 6698 and the EU General Data Protection Regulation, where applicable.
Turkish competition law and European Union competition rules.
Turkish anti-money laundering legislation and relevant foreign compliance requirements.
Turkish employment legislation and overseas employment obligations.
International commercial contracts and arbitration agreements.
Compliance with the law of the company's headquarters does not automatically establish compliance with Turkish law.
The reverse is also true.
A company should ensure that its Turkish response does not unintentionally create problems under other applicable legal systems.
12.2 Coordinating with overseas headquarters
Turkish legal counsel can help establish a clear reporting structure between the local subsidiary, parent company and overseas legal teams.
This may involve:
Identifying the relevant legal entities.
Establishing appropriate reporting responsibilities.
Preserving relevant records.
Reviewing international data transfer requirements.
Coordinating translations of regulatory correspondence.
Ensuring consistency in factual explanations.
Assessing whether foreign disclosure obligations arise.
Particular care is needed when investigation documents contain personal data, commercially sensitive information or communications that may receive different confidentiality protections in different jurisdictions.
12.3 Managing international commercial disputes
Cross-border disputes may involve different governing laws, courts and arbitration institutions.
Legal advisors examine the relevant contracts and dispute resolution clauses before recommending proceedings.
Where overseas proceedings are involved, coordination with qualified local lawyers may also be necessary.
The objective is to maintain a consistent legal strategy rather than allowing separate proceedings to develop conflicting positions.
13. Preventing Regulatory Problems Before They Arise
One of the most useful things a legal advisor can do is help a company identify problems before an investigation begins.
A business that only seeks legal assistance after receiving an official notice may already be dealing with avoidable compliance weaknesses.
A preventive approach is generally more practical.
13.1 Conducting a legal compliance review
A compliance review examines whether the company's actual business practices are consistent with applicable Turkish legislation.
Depending on the sector, this may include:
Corporate governance.
Competition law.
Tax obligations.
Employment practices.
Personal data protection.
Anti-money laundering requirements.
Commercial contracts.
Licensing.
Environmental obligations.
Industry-specific regulations.
After the review, legal advisors can identify weaknesses and recommend practical improvements.
13.2 Preparing clear internal policies
Written policies help employees understand what is expected of them.
Depending on the company's activities, these may include:
Code of conduct.
Anti-bribery and anti-corruption policy.
Competition compliance policy.
Personal data protection policy.
Employee disciplinary procedures.
Whistleblowing procedures.
Document retention policy.
Contract approval procedures.
Conflict-of-interest policy.
However, a policy should not simply remain on a company server. Employees need to understand how it applies to their daily work.
13.3 Training employees and management
Different departments face different legal risks.
Sales employees may need guidance on competition law. HR personnel may require training on employment legislation and employee privacy. Finance teams may need to understand tax documentation and reporting responsibilities.
Legal advisors can prepare training sessions that reflect the company's actual business activities.
13.4 Keeping compliance arrangements up to date
Turkish legislation and regulatory practice can change.
A procedure that was appropriate several years ago may no longer meet current legal requirements.
Ongoing legal support can help businesses monitor relevant legislative amendments, regulatory decisions and court judgments.
The aim is to ensure that compliance arrangements develop alongside the business.
14. What Should a Company Do Immediately After Receiving an Investigation Notice?
When an official notice arrives, management should avoid treating it as ordinary correspondence.
The first response should be organized, timely and based on the actual legal requirements.
The following steps provide a useful starting point.
Step 1: Keep the original notice
Preserve the original communication, including its attachments and delivery information.
Record when and how it was received, as this may be important for calculating statutory deadlines.
Step 2: Contact an appropriate legal advisor
Seek assistance from a lawyer familiar with the relevant area of Turkish law.
An investigation involving competition law may require a different legal approach from a tax examination or data protection complaint.
Step 3: Preserve potentially relevant documents
Avoid deleting, changing or concealing emails, contracts, accounting records or electronic communications that may be relevant.
Step 4: Identify the relevant employees and departments
Determine who may possess the information requested by the authority.
Communication should be coordinated to avoid inconsistent or incomplete explanations.
Step 5: Review the authority's requests
Legal counsel should establish which information must be provided, what requires clarification and whether there are legitimate grounds for an objection.
Step 6: Prepare an accurate response
The company's explanations should be supported by reliable evidence.
Unverified statements, speculative answers and unnecessary admissions should be avoided.
Step 7: Consider the available legal remedies
Management should understand the possible outcomes, including administrative sanctions, settlement opportunities, corrective measures and judicial proceedings.
A practical investigation checklist
Action | Why it matters |
Review the official notice | Understand the legal basis |
Record deadlines | Avoid missing procedural time limits |
Contact legal counsel | Coordinate the response |
Preserve evidence | Protect relevant records |
Assess the allegations | Establish the actual facts |
Review financial exposure | Understand possible consequences |
Prepare submissions | Present the company's position |
Consider judicial remedies | Protect legal rights |
Review internal compliance | Reduce future risks |
The checklist should always be adapted to the specific investigation and applicable statutory requirements.
15. Choosing the Right Legal Advisors in Istanbul
Selecting legal counsel is an important decision, especially when a regulatory investigation could affect the company's finances, reputation or ongoing operations.
A company should look beyond general legal experience and consider whether its prospective advisors understand the particular issues involved.
15.1 Knowledge of Turkish regulatory and administrative law
The lawyer should understand the legislation governing the matter and the powers of the relevant authority.
Experience with regulatory correspondence, investigation procedures, administrative decisions and judicial remedies can be particularly valuable.
15.2 Understanding of corporate and commercial matters
Regulatory problems often affect other aspects of a company's business.
A lawyer who understands corporate governance, commercial contracts, financial arrangements and shareholder relationships can better assess the wider consequences of an investigation.
15.3 Experience with international businesses
Foreign-owned companies may need assistance communicating with overseas headquarters and coordinating legal matters across jurisdictions.
Experience with international commercial transactions, foreign investment and cross-border legal issues can therefore be important.
15.4 Ability to handle evidence and litigation
Regulatory disputes often involve substantial documentary material.
Companies should consider whether their legal advisors can coordinate internal investigations, examine complex records, prepare written defenses and represent them in appropriate proceedings.
15.5 Honest and practical communication
Management needs clear answers, not unnecessary legal jargon.
A good legal advisor should explain:
What has actually happened?
Which legal provisions apply?
What evidence is available?
What are the possible consequences?
What should the company do next?
What legal remedies are available?
Responsible legal advice also means explaining the weaknesses in a company's position rather than promising a guaranteed result.
16. Why Ongoing Legal Advice Matters for Businesses in Istanbul
Istanbul's commercial environment brings together businesses from many industries and jurisdictions.
A company operating in banking, finance, logistics, construction, real estate, manufacturing, technology or international trade may encounter different legal and regulatory requirements throughout its activities.
For foreign-owned businesses, the challenge can be even greater because Turkish legal obligations must be considered alongside the company's wider international structure.
For example, a foreign investor establishing a subsidiary in Istanbul may need assistance with:
Company incorporation.
Corporate governance.
Shareholder arrangements.
Commercial contracts.
Employment documentation.
Tax and regulatory compliance.
Personal data protection.
International transactions.
Regulatory inspections.
Commercial dispute resolution.
Having legal counsel familiar with the company's operations makes it easier to respond when a problem arises.
It also helps management make better decisions before a disagreement becomes a formal dispute.
Ultimately, the value of ongoing legal advice is not measured only by the number of court cases handled. It is also reflected in the problems a company manages to avoid, the risks it identifies early and the confidence with which it makes important commercial decisions.
17. How Kurucuk & Associates Assists Companies With Regulatory and Corporate Legal Matters
At Kurucuk & Associates, we understand that a regulatory investigation or commercial dispute can create uncertainty for a company's management, employees, shareholders and business partners.
Our approach begins with understanding the client's actual circumstances, identifying the relevant Turkish legal framework and considering the practical consequences of the matter.
Based in Istanbul, we serve domestic and international clients dealing with Turkish corporate, commercial, investment and related legal matters.
17.1 Corporate and commercial legal advice
We assist businesses with legal matters arising from their corporate structures, commercial relationships and day-to-day operations.
This may involve reviewing contractual arrangements, examining corporate decisions and advising on shareholder and management matters.
17.2 Regulatory and administrative legal matters
Companies dealing with administrative authorities may need assistance understanding their obligations, reviewing official notices, preparing legal submissions and evaluating available remedies.
The appropriate approach depends on the relevant legislation and the circumstances of each matter.
17.3 Employment and corporate compliance matters
Employment-related complaints and internal corporate issues require careful consideration of Turkish law.
We assist businesses with employment-related legal questions, contractual arrangements and corporate legal matters.
17.4 Banking, finance and investment-related matters
Financial transactions and investment activities can involve detailed contractual and regulatory requirements.
Our corporate and banking-related practice includes advising on relevant Turkish legal matters and commercial disputes.
17.5 International business and cross-border legal coordination
Foreign companies operating in Türkiye often need legal advice that takes account of both their Turkish activities and wider international business arrangements.
Our multilingual practice and international client experience help us communicate with businesses from different jurisdictions and address their Turkish legal requirements.
Our team is led by Managing Partner Mehmet Özgür Kurucuk, together with experienced Istanbul Bar Association lawyers.
We believe that effective legal support starts with listening to the client, understanding the facts and explaining the available legal options in a clear and practical manner.
Companies seeking assistance with Turkish corporate or commercial legal matters can explore our legal services in Istanbul or contact our office to discuss their circumstances.
18. Frequently Asked Questions About Regulatory Investigations and Disputes in Türkiye
1. Why does a company need a legal advisor during a regulatory investigation in Türkiye?
A legal advisor helps the company understand the authority's powers, assess the allegations, preserve relevant evidence and prepare an appropriate response. Lawyers can also advise on potential sanctions, procedural rights and available legal remedies.
2. Can Turkish regulatory authorities inspect company premises without prior notice?
Yes. Certain authorities have statutory powers to conduct inspections without prior notice. For example, Article 15 of Law No. 4054 gives authorised Competition Authority officials on-site inspection powers. The applicable conditions depend on the relevant legislation.
3. What should a company do if the Turkish Competition Authority conducts a dawn raid?
The company should activate its inspection-response procedure, contact legal counsel, preserve relevant records and appoint a designated representative to coordinate communications with officials. It should cooperate with lawful inspection activities while ensuring that its procedural rights are respected.
4. Can a company challenge an administrative fine in Türkiye?
Yes, depending on the nature of the decision and the applicable legal procedure. The appropriate remedy may involve administrative objections or proceedings before the competent courts. The relevant statutory deadline should be checked immediately.
5. What is the deadline for challenging an administrative decision in Türkiye?
Under Article 7 of Law No. 2577, the general period is 60 days for administrative courts and the Council of State and 30 days for tax courts. However, special legislation may establish different periods.
6. Can a company challenge a tax assessment following an examination?
Yes. Depending on the procedural circumstances, the company may have access to statutory settlement mechanisms or proceedings before the competent tax court. Legal counsel should review the assessment and relevant deadlines before advising on the appropriate remedy.
7. What happens if a company violates Turkish personal data protection legislation?
The Personal Data Protection Board may investigate the matter and impose administrative sanctions under Law No. 6698 where the statutory requirements are met. Certain conduct may also have consequences under other applicable legislation.
8. Can a multinational company use its overseas legal team during a Turkish investigation?
Yes. An overseas legal team can coordinate with Turkish counsel. However, the company's response must comply with Turkish procedural requirements and applicable rules concerning evidence, confidentiality and international data transfers.
9. Are directors personally liable during regulatory investigations?
They may be, depending on the applicable legislation and their individual conduct. Certain laws establish personal administrative or criminal liability in specified circumstances. However, directors are not automatically personally liable simply because their company is under investigation.
10. Can a company conduct an internal investigation before responding to a regulator?
Yes. An internal investigation can help establish the facts, identify relevant documents and assess potential legal exposure. It must, however, respect applicable evidence preservation obligations, employee rights and any ongoing regulatory proceedings.
11. Is mediation compulsory for commercial disputes in Türkiye?
Mediation is a mandatory pre-litigation requirement for specified commercial disputes under Article 5/A of the Turkish Commercial Code. It generally applies to commercial claims seeking payment of a specified amount of money and compensation for such claims, subject to the statutory scope and exceptions.
12. Can foreign companies appoint an Istanbul law firm for Turkish regulatory proceedings?
Yes. Foreign companies can engage Turkish lawyers to advise and represent them in accordance with the relevant professional and procedural requirements. The precise representation arrangements depend on the type of proceeding and authority involved.
13. How can legal advisors help prevent regulatory investigations?
Lawyers can conduct compliance reviews, identify weaknesses in company procedures, prepare internal policies, review commercial arrangements, train employees and monitor relevant legislative developments. These steps can reduce regulatory risks, although they cannot guarantee that a company will never be investigated.
14. When should a company contact a lawyer about a regulatory dispute?
Ideally, legal counsel should be involved as soon as the company receives an official notice, inspection request, regulatory complaint or credible indication of a potential violation. Early advice helps preserve evidence, identify deadlines and avoid unnecessary procedural mistakes.
The Right Legal Advice Can Make a Difference Before a Dispute Escalates
Regulatory investigations and corporate disputes are part of the legal risks businesses may face while operating in Türkiye.
A competition inquiry, tax examination, personal data protection complaint or disagreement with an administrative authority can create serious challenges for management. Commercial disputes involving shareholders, employees, suppliers and business partners can be equally demanding.
The important thing is not to wait until the situation becomes difficult to manage.
Experienced legal advisors help companies understand the allegations, assess the available evidence, comply with applicable procedures and make informed decisions about their legal options.
For multinational corporations, this also means coordinating Turkish legal requirements with international business arrangements and overseas reporting responsibilities.
For businesses operating in Istanbul, access to knowledgeable Turkish legal counsel can provide valuable support when dealing with regulatory uncertainty and commercial disagreements.
Kurucuk & Associates, based in Istanbul, Türkiye, advises domestic and international clients on corporate, commercial, banking, finance, investment, employment, immigration and related legal matters.
Our approach is centered on understanding each client's needs, explaining the applicable Turkish legal framework and providing practical advice to help businesses protect their legitimate interests.
Legal disclaimer: This article provides general information and is not a substitute for legal advice concerning a particular investigation, dispute or transaction. Legislative amendments, special statutory procedures and judicial interpretations may affect the application of the provisions discussed. Companies should obtain case-specific legal advice before taking action.
