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Enforcement and Bankruptcy Law
Importance of Enforcement and Bankruptcy Law
Enforcement and bankruptcy law isone of the most critical areas of law for the orderly functioning of economic life, the payment of debts and the securing of receivables in Turkey. This area of law directly affects not only individuals but also companies, investors and financial institutions.
As MFY Legal | Law Office, we provide a wide range of services from execution proceedings to bankruptcy cases, from concordat to restructuring. Our aim is to ensure that both the rights of creditors are protected and debtors are subject to a fair process within the legal framework.
What is Enforcement and Bankruptcy Law?
Execution and bankruptcy law is the branch of law that regulates the collection of debts by state power, the protection and liquidation of the debtor’s assets.
- Enforcement Law: Enables creditors to collect their receivables through enforcement offices with documents such as court orders or bills of exchange.
- Bankruptcy Law: It regulates the collective liquidation of the assets of merchants who cannot pay their debts and the equal distribution to creditors.
Enforcement Procedures in Enforcement Law
Within the scope of enforcement and bankruptcy law, there are different ways of proceedings that creditors can apply:
- Execution Proceedings without a judgment – The creditor, who does not have a court decision, applies to the enforcement office and requests the collection of the debt.
- Execution Proceedings – Proceedings based on a court decision, arbitral award or a document in the nature of a judgment.
- Specific Tracking of Bills of Exchange – Special and fast tracking method based on bills of exchange such as checks, bonds and policies.
- Seizure and Sale – Seizure of the debtor’s assets and sale by auction.
Bankruptcy Law and Its Importance for Companies
Bankruptcy is a legal remedy available only to merchants.
- Bankruptcy Case: It is filed in the commercial court upon the application of the debtor or creditor.
- Bankruptcy Estate: After the bankruptcy decision, all assets of the debtor enter the “bankruptcy estate”.
- Meeting of Creditors: The ranking of creditors and allocation procedures are determined here.
This process has both legal and commercial consequences for companies. A mismanaged insolvency process can also lead to liability for the company’s shareholders.
Concordat and Restructuring
In recent years, concordat isthe most common way for companies that have difficulty in paying their debts.
- Concordat allows the debtor to continue its activities by agreeing on a specific payment plan with creditors.
- With the post-2018 legal regulations, concordat has become a more preferred method compared to bankruptcy.
Legal Basis
The fundamental basis of enforcement and bankruptcy law:
- Law No. 2004 on Enforcement and Bankruptcy (Official Gazette: 19.06.1932 / 2128)
- Relevant decisions of the Court of Cassation, concordat regulations and regulations on enforcement offices.
Case Example: Company Concordat in 2025
Situation: An Istanbul-based manufacturing company was unable to make its payments in 2025 due to fluctuations in global markets.
Process:
- MFY Legal filed a concordat application on behalf of the company.
- The court granted a temporary respite and the company’s assets were taken under protection.
- A detailed improvement project was presented at the hearings over the objections of some creditors.
Conclusion:
- Concordat finalized.
- The company continued its operations, more than 200 employees kept their jobs.
- The vast majority of creditors received their payments on schedule.
This example shows how the right legal guidance protects both the company and creditors.
Question – Answers
It is the branch of law that regulates the collection of debts by the state and their liquidation through bankruptcy. With enforcement proceedings, the creditor receives his/her right through the enforcement office; with bankruptcy, the debtor’s assets are distributed to all creditors.
It takes 1-12 months on average. The duration varies according to the debtor’s objection, the state of the debtor’s assets and the intensity of the case.
It is a legal way for the debtor to avoid bankruptcy by agreeing on a specific payment plan with creditors. With the concordat plan approved by the court, the company restructures its debts and continues its commercial activities.
Frequently Asked Questions
- How to start enforcement proceedings?
- In which court is the bankruptcy case filed?
- How are the debtor’s assets protected?
- What are the documents required for the concordat application?
Conclusion and Call
Execution and bankruptcy processes have critical consequences for both debtors and creditors. Missteps can lead to loss of rights.
👉 Contact MFY Legal | Law Office for expert legal support tailored to you.
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