Invoices, promissory notes and other payment instruments under Turkish law (2).
In the second part of this article, I will be providing more information on the debt collection process for outstanding debts arising from unpaid invoices and promissory notes in Turkey. I have already elaborated on how a payment order is processed and what a debtor can do against a payment order so please refer to the first part of this article to find more information about this.
Once a debtor raises an objection against a payment order, the creditor can file a lawsuit to cancel the objection. The court will review the commercial records and commercial books of the parties, correspondences and notices between the parties, etc. during the course of the litigation. However, the most important item which will be reviewed by the court is the invoice. Therefore, it is essential to identify the issues which should be included in any invoice according to Turkish law.
As per the Tax Procedural Law, the below items should be stated in the invoice before it is issued:
- The issuance date of the invoice, serial and item number;
- The name of the issuing party, the trading name of the company if available, its business address, its related tax office and account number;
- The client's name, trading name, address and the tax number and account number if available;
- The type of product or service, the quantity, the price of the product or service; and
- The delivery date of the products sold and the waybill.
Before discussing the collection procedure for an outstanding debt arising from a promissory note, I would like to first provide a little information on the issues that should be taken into account at the time of receiving a promissory note from a Turkish company.
The first essential issue is the signature. The promissory note should be signed with the precedence of the party to which the promissory is provided. In addition, it is strongly advised that the signatory of the promissory note be the authorized representative of the debtor who has the power to bind and represent the company with respect to issuing promissory notes on its behalf. For this purpose, a circular of signatures of the company should be made available at the time of signing of the promissory note and it should be checked against the respected circular of signatures to ensure that the signatory is indeed empowered.
The second essential issue that should be taken into account is the issuance date of the promissory note. The date on which the promissory note is executed should be written in the note.
Provided that the promissory note possesses all the required conditions as set forth by the law and the creditor wishes to collect the outstanding debt from a promissory note, what procedures can be initiated against the debtor?
When a creditor wishes to collect an outstanding debt due from a promissory note, they can initiate an execution proceeding with the respective bailiff office in Turkey. Following the filing of such a proceeding, the bailiff's office will serve the payment order to the debtor in question.
If the debtor submits limited objections as stipulated by the law, such as the claim stating the debt does not belong to the party, the debt has been paid, the debt has been prescribed, etc., the court will accordingly consider the valid claims and the case will be pending before the related court for a period of between six months and two years. The court will hand down its respected decision based on its sole and absolute discretion.
NOTE: Berk Ecektir is a licensed attorney at law and available to answer questions on the legal aspects of living in Turkey. Send enquiries to firstname.lastname@example.org. The names of the readers are disclosed only upon written approval of the sender.
DISCLAIMER: The information provided here is intended to give basic legal information. You should get legal assistance from a licensed attorney at law while conducting legal transactions and not just rely on the information in this corner.
BERK EcEKTyR (Cihan/Today's Zaman) CyHAN
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|Publication:||Cihan News Agency (CNA)|
|Date:||Feb 19, 2014|
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