Security for Costs for Foreign Plaintiffs and Creditors in Turkey: MÖHUK Article 48

1. MÖHUK Article 48 creates a nationality-based security rule for foreign parties

International Private and Procedural Law No. 5718 Article 48 is the central Turkish rule commonly described as cautio judicatum solvi. It states that foreign natural and legal persons who bring an action in a Turkish court, participate in an action or initiate enforcement proceedings must provide security determined by the court to cover litigation/enforcement costs and the opposing party’s loss and damage.

The provision is procedural. It does not determine whether the foreign claimant’s underlying commercial, tort, inheritance or contractual claim is valid. A foreign creditor can have a strong substantive claim and still need to address the Article 48 security issue before the Turkish proceedings continue in the ordinary way.

Article 48 should be checked at the start of the file, not after the statement of claim or enforcement request is ready. Nationality or legal-person status, applicable reciprocity and treaties can change whether security must actually be deposited.

2. The rule covers both foreign natural persons and foreign legal entities

Article 48 expressly names foreign natural persons and foreign legal persons. A foreign corporation, foundation or other legal entity acting as claimant or enforcement creditor can therefore fall within the rule even when it has commercial dealings, assets or an affiliate in Turkey.

A Turkish-incorporated company with foreign shareholders is not a “foreign legal person” merely because its capital is foreign-owned. It is a Turkish legal entity. The nationality/status analysis must be made at the level of the actual claimant named in the proceedings.

This distinction matters in group structures. If a German parent company is the contractual creditor and files the Turkish claim, Article 48 is analysed for the German entity. If its Turkish subsidiary is the contractual creditor and claimant, the foreign-person rule is not triggered merely by the parent’s ownership.

Where claims have been assigned before litigation, the assignment must be genuine and legally effective. A corporate group should not restructure a receivable only to avoid security without considering assignment validity, tax, accounting and standing consequences.

3. Article 48 applies to lawsuits, intervention and enforcement proceedings

The statutory scope is broader than civil lawsuits. Article 48 covers three procedural positions: bringing an action before a Turkish court, intervening in litigation, and initiating enforcement proceedings.

A foreign company suing a Turkish distributor for unpaid invoices is therefore within the text. So is a foreign third party entering pending litigation in the procedural role covered by the provision. A foreign creditor that does not first sue but instead starts Turkish debt-enforcement proceedings also falls within the express wording.

The Ministry of Justice issued a dedicated circular on 19 June 2023 because enforcement offices were applying the security and reciprocity rules inconsistently. The circular confirms that Article 48 is directly relevant when foreign natural or legal persons apply to Turkish enforcement offices as creditors.

Foreign parties should distinguish this security from other securities required for provisional attachment, preliminary injunction, staying enforcement or appeals. Those are based on different statutes and serve different purposes.

4. Article 48 security covers costs and the opposing party’s potential loss and damage

Article 48(1) identifies the protected interests: judicial and enforcement costs and the opposing party’s loss and damage. The security is not a payment of the debt in dispute and is not automatically transferred to the defendant or debtor.

The amount and form are determined within the applicable procedural framework. In court proceedings, the court handles the security issue. In enforcement proceedings, the Ministry of Justice’s 2023 circular explains that the reference to the “court” is applied to the enforcement office in the compulsory-enforcement procedure.

The amount should not be confused with court fees or advance expenses. A foreign claimant may need to pay ordinary filing charges and expense advances in addition to any Article 48 security.

Nor does security constitute an admission that the claim is weak. The statutory trigger is foreign status, subject to reciprocity/treaty exemption, rather than a merits assessment of the claim.

5. Article 48(2) requires an exemption where reciprocity exists

Article 48(2) provides that the court exempts the claimant, intervener or enforcement creditor from security on the basis of reciprocity. The Ministry of Justice explains reciprocity here as the corresponding foreign state granting Turkish citizens the same security exemption.

Reciprocity can arise through international agreements and can also require analysis of the foreign state’s law or actual practice. The Ministry’s current information page expressly publishes treaty-based sources and explains the reciprocity concept for Article 48.

The practical result is that foreign nationality does not automatically mean money must always be deposited. The first step is to identify the person’s state and verify whether an applicable bilateral/multilateral treaty or reciprocity basis removes the obligation.

Because treaty participation and reciprocal practice can change, the current official Ministry sources should be checked on the filing date. A historic memorandum stating that a country was once exempt should not be used without current verification.

6. International treaty exemptions take priority under Law No. 5718 Article 1

Article 1 of Law No. 5718 preserves provisions of international agreements to which Turkey is a party. This is important because several conventions and bilateral judicial-assistance agreements provide that nationals or qualifying legal entities of the contracting states cannot be required to furnish security merely because they are foreign or lack domestic residence.

The Ministry of Justice’s Directorate General for Foreign Relations and European Union publishes a dedicated “foreigners’ obligation to provide security” page listing relevant multilateral and bilateral instruments and explaining special rules for categories such as stateless persons and refugees.

Treaty reliance must be exact. The party should confirm that both states are bound by the instrument, that it is in force between them, that the person falls within the covered category, and that the relevant proceeding is within its scope.

Where a treaty exemption is established, the foreign claimant should present the legal basis at the outset so that the court or enforcement office does not unnecessarily demand a deposit.

7. In enforcement proceedings, the enforcement office assesses security and reciprocity

The Ministry of Justice Enforcement Affairs Department’s 19 June 2023 circular addresses foreign creditors applying to enforcement offices. It concludes that a foreign creditor’s obligation to provide security and any Article 48 reciprocity exemption are to be assessed within the compulsory-enforcement procedure by the enforcement office.

The circular also instructs offices to consider international agreements preserved by Article 1. Where reciprocity is unclear, it states that obtaining information through the Ministry’s Directorate General for Foreign Relations and European Union is appropriate.

For a foreign company seeking rapid collection, this means the Article 48 analysis should be prepared before filing the enforcement request. Corporate-status evidence, nationality/seat documentation and the reciprocity or treaty basis should be available in a Turkish-usable form.

The enforcement office’s security assessment does not resolve the merits of an objection to debt. If the debtor contests the enforcement and subsequent litigation is necessary, the procedural strategy must account for both the enforcement file and any court proceedings.

8. Article 48 does not itself write a fixed percentage into the statute

Article 48 says the security is determined by the court; it does not state a universal fixed percentage of every claim. In enforcement practice, however, the Ministry of Justice’s 2023 circular records its administrative view that where security must be taken, a rate not lower than 20% of the enforcement claim is appropriate, considering the potential loss and compensation rules in enforcement law.

In a court action, the amount and form of security are set under the applicable procedural provisions. Code of Civil Procedure Article 87 gives the judge discretion to determine the amount and form of security unless the parties have validly agreed its form.

Security can therefore be a material cash-flow issue for a high-value foreign claim. The claimant should determine likely security exposure before deciding whether to litigate, enforce, arbitrate or negotiate.

9. HMK Article 84 deals with different security grounds and should not replace the foreign-person analysis

Code of Civil Procedure Article 84 contains the domestic civil-procedure rules for security. One category is a Turkish citizen who does not have habitual residence in Turkey and brings an action, intervenes on the claimant’s side or initiates enforcement. Another category concerns documented financial difficulty of the claimant, such as prior bankruptcy, restructuring or an insolvency certificate.

The foreign-person rule is instead specifically regulated by MÖHUK Article 48. A foreign claimant should not be told that no security is required merely because HMK Article 84(1)(a) refers to Turkish citizens; Article 48 separately addresses foreign natural and legal persons.

HMK Article 85 lists circumstances in which the security under that procedural framework is not required, including legal aid, sufficient Turkish immovable property or a secured receivable, certain child-protection cases and enforcement based on a judgment. The interaction with Article 48 and any international agreement must be analysed under the correct source for the particular party.

In international files, nationality/status, habitual residence, type of proceeding and treaty position should therefore be recorded separately instead of applying one generic “security for costs” checklist.

10. A foreign company should price Article 48 into Turkish litigation strategy before filing

A foreign claimant often evaluates a Turkish lawsuit using only court fees, counsel fees and translation costs. Article 48 can add a separate security requirement and, in enforcement proceedings, can affect how quickly the file proceeds.

The company should first identify the Turkish asset target and preferred procedure. An enforceable Turkish judgment, a direct debt-enforcement route, a provisional attachment request and recognition/enforcement of a foreign judgment each have different procedural conditions.

Second, it should verify the claimant entity. In a multinational group, the invoice issuer, contract party and assignee may not be the same group company. The Article 48 nationality analysis follows the actual claimant.

Third, the company should obtain current official confirmation of treaty or reciprocity status. If exempt, it should cite the specific legal basis in the opening filing rather than waiting for the authority to request security.

11. Failure to provide ordered security can stop the procedural route

Security is a procedural precondition that must be taken seriously. Under the Code of Civil Procedure framework, the court grants a definite period for required security and failure to provide it can lead to the procedural consequence prescribed by the Code. In enforcement, the foreign-creditor security issue is assessed at the opening and continuation stage in accordance with Article 48 and the Ministry’s implementation guidance.

A foreign party should therefore challenge or seek exemption from an improper security requirement promptly through the applicable procedural route; simply refusing to comply while the issue remains in force can jeopardise the case.

Where reciprocity evidence is needed, the 2023 circular specifically notes that information may be obtained through the Ministry/Foreign Affairs channels. The claimant should support the request with reliable official material rather than an unofficial internet summary.

Once the reason for security disappears or the proceedings end, release/return of the security is handled under the relevant procedural decision and security instrument. The company should track the deposit or guarantee after judgment instead of treating it as a sunk litigation expense.

12. Prepare the reciprocity and corporate-status file before the first Turkish filing

A foreign legal entity should have a current registry extract or equivalent evidence showing its legal name, seat and legal existence. Where documents are issued abroad, Turkish use can require apostille or consular authentication and certified Turkish translation depending on the document and applicable treaty.

The legal team should identify the exact treaty or reciprocity source relied upon for exemption and attach or cite the authoritative text. If the Ministry’s published page identifies the relevant convention, the party should still verify current participation and applicability to the specific country and entity.

For a foreign judgment that will be enforced in Turkey, separate requirements apply under Law No. 5718 Articles 50–57. For a foreign-court clause in the underlying contract, see Foreign Court Jurisdiction Clauses under MÖHUK Article 47. For governing law, see MÖHUK Article 24 Governing Law.

The core point is procedural readiness: nationality status, security exposure, exemption basis and the form of acceptable security should be resolved before the claim is launched.

Conclusion

MÖHUK Article 48 makes security for costs a default procedural issue for foreign natural and legal persons suing, intervening or pursuing enforcement in Turkey. The obligation is not absolute: Article 48(2) requires exemption on reciprocity grounds, and Law No. 5718 Article 1 preserves treaty-based exemptions.

For foreign creditors using Turkish enforcement offices, the Ministry of Justice’s 19 June 2023 circular confirms that the enforcement office assesses the security/reciprocity issue and gives administrative guidance on the amount where security is required. Foreign claimants should therefore verify exemption status and prepare the supporting official documents before filing rather than treating security as an afterthought.