Navigating Jurisdictional Frontiers in Turkish Construction Arbitration: Public Contracts and the Shadow of Judicial Review

I. Introduction: The New Nexus of Turkish Construction and Global Arbitration

The Turkish construction and infrastructure sector stands as a formidable force in both the national and global economy. For decades, Turkish contractors have demonstrated remarkable capacity, undertaking thousands of large-scale projects in over 90 countries, with a cumulative project value in the hundreds of billions of dollars. This international expansion, coupled with ambitious domestic infrastructure development, has created a fertile ground for complex, high-value disputes. These are not ordinary commercial disagreements; they are multifaceted conflicts involving intricate technical questions, labyrinthine contractual arrangements, and multiple stakeholders, making them uniquely challenging for traditional court systems.

In response to this complexity, the Turkish construction industry has increasingly pivoted towards arbitration as its principal method of dispute resolution. Arbitration offers distinct advantages that are particularly well-suited to the sector: the ability to appoint arbitrators with specialized engineering and legal expertise, the confidentiality of proceedings which protects commercially sensitive information, and a perceived efficiency compared to often protracted court litigation. This shift is not merely a matter of preference but a strategic necessity in a globalized market where international partners and financiers demand neutral, predictable, and enforceable dispute resolution mechanisms.

As Türkiye actively cultivates its status as a regional arbitration hub, epitomized by the establishment of the Istanbul Arbitration Centre (ISTAC), it confronts a fundamental and evolving tension. This tension lies at the intersection of two powerful legal principles: the autonomy and finality of arbitral awards, which is the bedrock of international arbitration, and the non-delegable supervisory jurisdiction of the state judiciary, particularly when the public interest is at stake. This dynamic is most pronounced and legally intricate in disputes arising from public contracts—those involving public procurement, concession agreements, and large-scale infrastructure projects financed through public-private partnerships (PPPs) like the Build-Operate-Transfer (BOT) model.

This article provides an exhaustive analysis of this critical jurisdictional frontier. It will first map the domestic legal and contractual framework governing construction arbitration in Türkiye, examining the International Arbitration Law (IAL) and the practical application of global standards like FIDIC contracts. It will then delve into the historically contentious and rapidly evolving landscape of arbitrating disputes involving the Turkish state, tracing the paradigm shift from state immunity to arbitral consent. The analysis will pivot on the crucial role of the Turkish judiciary, particularly the Court of Cassation, in defining the limits of its own intervention through the "public policy" exception. To contextualize Türkiye's trajectory, this article will conduct a rigorous comparative analysis of the approaches to judicial control over public contract arbitration in three leading jurisdictions: France, Switzerland, and the United Kingdom. Synthesizing these domestic and international perspectives, the article will conclude by proposing a harmonized legal model designed to enhance predictability, safeguard the public interest, and ultimately cement Türkiye's position as a reliable and sophisticated seat for international construction arbitration.

II. The Dual Pillars: Turkey's Legal and Contractual Framework for Construction Disputes

The efficacy of construction arbitration in Türkiye rests on two foundational pillars: a modern legislative framework designed to align with international standards and a sophisticated contractual practice that adapts global norms to local realities. Understanding the interplay between the Turkish International Arbitration Law, the rise of domestic arbitral institutions like ISTAC, and the widespread use of FIDIC contracts is essential to grasping the operational dynamics of dispute resolution in the sector.

A. The Turkish International Arbitration Law (IAL) No. 4686: An International Model with a National Character

At the heart of Türkiye's arbitration regime is the International Arbitration Law (IAL) No. 4686, enacted in 2001. This legislation represents a deliberate move to modernize Turkish law and harmonize it with global best practices.

The IAL is fundamentally based on the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration, a testament to Türkiye's commitment to creating a familiar and predictable legal environment for foreign parties. It governs international arbitrations seated in Türkiye and enshrines key principles that are indispensable to modern arbitration. These include party autonomy, which allows parties to tailor the arbitral process to their needs; the separability of the arbitration agreement from the main contract, ensuring that a dispute over the contract's validity does not nullify the agreement to arbitrate; and the principle of kompetenz-kompetenz, which empowers the arbitral tribunal to rule on its own jurisdiction.

The IAL is not, however, a verbatim adoption of the UNCITRAL model. It contains several significant modifications that reflect a uniquely Turkish approach to balancing the international desire for arbitral autonomy with a national insistence on judicial efficiency and control. One of the most prominent modifications is the imposition of stricter time limits. For instance, the IAL mandates that an arbitral award must be rendered within one year from the appointment of the sole arbitrator or the constitution of the tribunal, a period that can be extended only by party agreement or court order. Furthermore, an action to set aside an award must be initiated within an expedited period of 30 days. These modifications reveal a conscious legislative effort to prevent the protracted proceedings that can sometimes plague arbitration, prioritizing speed and finality. Concurrently, the IAL provides for a slightly broader scope for setting aside awards than the UNCITRAL model, retaining a robust supervisory role for the national courts. This legislative architecture suggests that while Türkiye is unequivocally "pro-arbitration," it is pro-"Turkish-style" arbitration, where the courts remain a more accessible and active backstop than in many other leading jurisdictions. This can be viewed as both a benefit for parties seeking faster recourse against a flawed award and a potential risk for those prioritizing maximum finality.

The IAL defines the scope of disputes that can be submitted to arbitration. While most commercial matters, including complex construction disputes, are arbitrable, the law carves out two critical exceptions. First, disputes arising from or relating to in rem rights over immovable property located in Türkiye are non-arbitrable and fall under the exclusive jurisdiction of Turkish courts. Second, disputes that "cannot be subject to the parties' will," a category generally understood to encompass matters of public order such as criminal, family, and certain administrative law issues, are also excluded. This "public order" or "public policy" exception is a crucial gateway for judicial intervention, the interpretation of which will be examined in detail later in this article.

B. The Rise of ISTAC: A National Champion for International Arbitration

The establishment of the Istanbul Arbitration Centre (ISTAC) in 2015 marked a pivotal moment in the development of Turkish arbitration. It was a strategic initiative, supported by the government, to create a modern, credible, and efficient domestic institution capable of competing with established international bodies like the International Chamber of Commerce (ICC) and attracting both domestic and international disputes.

ISTAC's rules and structure were carefully designed to appeal to a global audience. They are heavily influenced by the well-regarded ICC Rules of Arbitration, providing a sense of familiarity to international practitioners who may be accustomed to ICC proceedings. However, ISTAC also incorporated innovative features aimed at addressing common criticisms of international arbitration. These include a set of fast-track arbitration rules that automatically apply to claims below a certain threshold (currently TRY 300,000, or approximately US$100,000 at its inception), ensuring a swift and cost-effective resolution for smaller disputes. Furthermore, ISTAC's fee structure is deliberately competitive, often amounting to a fraction of the costs associated with litigation in Turkish courts or arbitration under other international institutions.

The Turkish government's promotion of ISTAC has been a key factor in its rapid ascent. As will be discussed further, public authorities have been encouraged, and in some cases mandated, to include ISTAC arbitration clauses in public procurement and infrastructure contracts. This state endorsement has not only bolstered ISTAC's caseload, which has seen a significant increase in construction-related disputes, but has also sent a clear signal to the international community about Türkiye's long-term commitment to developing a robust arbitration ecosystem.

C. The Primacy of FIDIC: Adapting Global Standards to Local Realities

On the contractual front, the Turkish construction industry overwhelmingly relies on the standard forms of contract published by the International Federation of Consulting Engineers (FIDIC). The various "Rainbow Suite" books—particularly the Red Book (Conditions of Contract for Construction), Yellow Book (for Plant and Design-Build), and Silver Book (for EPC/Turnkey Projects)—provide a sophisticated and internationally recognized framework for allocating risks and defining the rights and obligations of employers and contractors. Their widespread adoption in large-scale and internationally financed projects in Türkiye provides a common contractual language that facilitates smoother project execution and more predictable dispute resolution.

However, the use of FIDIC contracts in Türkiye is not a simple copy-and-paste exercise. Parties frequently make significant amendments to the standard forms to align them with the nuances of Turkish law and local commercial practices. Common amendments include modifying the provisions on delay damages (Sub-Clause 8.8) to clarify whether they constitute a "contractual penalty" (cezai şart) or "liquidated damages" (götürü tazminat) under the Turkish Code of Obligations, as these concepts have different legal requirements concerning proof of fault and the possibility of judicial reduction.

Perhaps the most significant and revealing local adaptation is the common practice of deleting or fundamentally altering FIDIC's multi-tier dispute resolution mechanism, particularly the provisions establishing a Dispute Adjudication Board (DAB) or a Dispute Avoidance/Adjudication Board (DAAB). The FIDIC model is intentionally designed for dispute avoidance and early, on-site resolution. The DAB/DAAB is a standing or ad-hoc body of impartial experts intended to provide swift, interim-binding decisions to resolve disagreements as they arise, thereby preserving project cash flow and preventing issues from escalating into full-blown arbitration. The frequent removal of this mechanism in Turkish contracts in favor of a direct path to arbitration suggests a cultural or practical preference for a single, definitive, and adversarial resolution over preventative, real-time interventions. This trend, which runs counter to the global movement towards dispute avoidance, may be driven by a perception of dispute boards as an unnecessary layer of cost and bureaucracy, or a lack of a deep pool of trained local adjudicators. Whatever the cause, its effect is profound: it removes a crucial tool for maintaining project momentum and relationships, increasing the likelihood that disputes will fester and ultimately require a more costly and time-consuming arbitral process.

III. The Public-Private Fault Line: Arbitrating State-Involved Infrastructure Disputes

The arbitration of disputes involving the Turkish state or its entities represents the most dynamic and legally complex area of construction arbitration in the country. This domain has undergone a profound transformation, moving from a position of near-absolute state immunity from arbitration to one of active consent and even encouragement. This shift was not a gradual legal evolution but a deliberate policy choice driven by economic necessity, and its implementation continues to be shaped by the supervisory role of the Turkish judiciary.

A. From State Immunity to Arbitral Consent: A Paradigm Shift

Historically, contracts entered by the Turkish state, particularly concession agreements for the provision of public services, were considered administrative contracts falling under the exclusive jurisdiction of the Turkish Council of State (Danıştay), the nation's highest administrative court. The rationale was rooted in principles of state sovereignty and the belief that disputes involving public services and state assets could not be delegated to private arbitrators. This legal doctrine created a significant barrier to foreign investment in major infrastructure projects, as international investors and lenders were reluctant to subject themselves to the jurisdiction of the state's own courts in the event of a dispute.

The turning point came in the late 1990s, a period when Türkiye sought to attract massive foreign capital for ambitious infrastructure projects, particularly through the Build-Operate-Transfer (BOT) model. Recognizing that the prohibition on arbitration was a critical impediment, the Turkish legislature enacted a landmark constitutional amendment in 1999. This amendment explicitly permitted the use of arbitration for disputes from concession contracts. This constitutional change was swiftly followed by the enactment of Law No. 4501 in 2000, which established the principles for submitting disputes from concession contracts involving a "foreign element" to international arbitration. This legislative overhaul was a clear, top-down policy initiative designed to align Türkiye's legal framework with the expectations of the global investment community. It signaled a fundamental shift: the state was now willing to meet foreign investors on the neutral ground of arbitration to facilitate the development of critical national infrastructure.

B. The Public Procurement Arbitration Revolution

Building on the foundation laid for concession contracts, Türkiye has more recently extended the embrace of arbitration to the vast field of public procurement. This development was catalyzed by a 2016 Prime Ministry Circular that advised all public authorities to consider including ISTAC arbitration clauses in their contracts. This advisory was subsequently solidified through amendments to public procurement regulations, which now explicitly provide for arbitration as an alternative to litigation in the standard-form contracts used for public tenders.

These regulations often designate ISTAC as the default or preferred arbitral institution for domestic disputes and one of the primary options for international ones. This move serves a dual purpose. First, it aims to resolve public contract disputes more efficiently and rapidly than is often possible in the heavily burdened state court system. Second, it reinforces the status and credibility of ISTAC, positioning it as the national institution of choice for resolving the state's own commercial disputes. This systematic integration of arbitration into the public procurement process represents the maturation of the policy that began in 1999, extending the principle of arbitral consent from large-scale concessions to the everyday business of the state.

C. Judicial Scrutiny: The Court of Cassation and the "Public Policy" Gauntlet

While the legislative and executive branches have driven the policy shift towards arbitration, the ultimate success of this initiative hinges on the judiciary's interpretation and enforcement of arbitral awards. Under Article 15 of the IAL, a domestic or international arbitral award rendered in Türkiye can be set aside by the courts if it is found to be contrary to "public policy" (kamu düzeni). Historically, the abstract and undefined nature of this concept created significant legal uncertainty, with some courts adopting a broad interpretation that allowed for a wide-ranging review of awards, undermining their finality.

However, in a crucial alignment with the state's pro-arbitration policy, the Turkish Court of Cassation has, over the past decade, championed a progressively narrow and internationally convergent interpretation of public policy. This trend is a vital judicial contribution to making Türkiye a more reliable arbitral seat. The courts are not acting in a vacuum; they are actively facilitating the government's economic goal of fostering a predictable and enforcement-friendly legal environment. If the legislature permits arbitration but the judiciary frequently annuls awards on expansive public policy grounds, the legislative reforms would be hollow, and investors would still lack the certainty they require.

This judicial evolution is best illustrated by a landmark decision from the 15th Civil Chamber of the Court of Cassation on September 26, 2019 (File No. 2019/2474). The case concerned an annulment action against an arbitral award in a construction dispute between a contractor and a subcontractor. The lower court had annulled the award on public policy grounds, citing several procedural irregularities: the arbitral tribunal had failed to conduct an on-site examination despite conflicting expert reports, the underlying contract was in English and had not been officially translated into Turkish, and the tribunal had not issued a formal Terms of Reference as required by the IAL.

In a decisive reversal, the Court of Cassation held that none of these issues constituted a violation of public policy. It reasoned that for an award to be annulled on public policy grounds, it must violate the fundamental values of the Turkish legal order, the foundational principles of justice, or core constitutional rights. Mere procedural errors, misapplications of the law, or disagreements with the tribunal's handling of evidence do not meet this high threshold. The Court explicitly classified the failure to conduct an on-site visit or the absence of a translated document as procedural matters falling within the tribunal's discretion, not as fundamental breaches of the legal system. This ruling sent a powerful message to the local and international arbitration communities: Turkish courts will respect the autonomy of arbitral tribunals and will not engage in a revision au fond (a review of the merits) under the guise of public policy.

Despite this positive trajectory, jurisdictional tensions persist in certain areas. A notable example is the conflict between arbitration agreements and bankruptcy proceedings. In a controversial 2021 decision, the General Assembly of the Court of Cassation ruled that where a creditor initiates bankruptcy proceedings against a debtor, the state courts—not an arbitral tribunal—have jurisdiction to determine the existence of the underlying debt, even in the face of a valid arbitration clause. The Court reasoned that bankruptcy law is a matter of public order that overrides the parties' private agreement to arbitrate. This decision highlights that the judiciary's pro-arbitration stance is not absolute and that certain domains involving collective enforcement and public interest remain carved out from the scope of arbitration, creating pockets of legal risk that parties must navigate carefully.

IV. Comparative Perspectives on Judicial Control of Public Contract Arbitration

Türkiye's journey toward a balanced framework for public contract arbitration does not exist in isolation. Its evolving approach can be better understood and refined by examining the models adopted by other leading jurisdictions. The legal systems of France, Switzerland, and the United Kingdom offer a clear spectrum of judicial oversight, providing valuable benchmarks for assessing Türkiye's current position and future direction.

A. The French Model: Administrative Prerogative and Limited Review

France presents a unique dualist legal system, with separate hierarchies for civil courts and administrative courts. Traditionally, this system imposed a strict prohibition on public entities resorting to arbitration, viewing it as an abdication of the administrative courts' jurisdiction. However, jurisprudence and legislation have carved out significant exceptions, particularly for contracts involving the interests of international commerce, making arbitration a viable option for many public infrastructure projects.

The critical feature of the French model is that when an arbitral award concerning a contrat administratif (a public law contract) is challenged, the review may fall to the administrative courts if the challenge implicates mandatory rules of French public law. The scope of this review was clarified in the landmark 2016 decision of the Conseil d'État (the highest administrative court) in Société Fosmax LNG. In that case, an arbitral tribunal had mistakenly applied private law to a public works contract. Fosmax sought annulment, arguing this error of law was fatal.

The Conseil d'État established a doctrine of limited and targeted review. It held that it would not re-examine the merits of the dispute or annul an award simply because the arbitrators misapplied the law. Instead, its intervention is reserved for instances where the award violates a mandatory rule of French public law—a rule from which the parties cannot derogate. In Fosmax, the court partially annulled the award because the arbitrators had denied the public entity a fundamental prerogative of public contract law: the right to unilaterally order a defaulting contractor's work to be completed by a third party at the contractor's expense. This sophisticated model respects the finality of arbitration while empowering a specialized court to safeguard core principles of public and administrative law.

B. The Swiss Paradigm: Sanctity of the Arbitral Award

Switzerland represents the minimalist end of the judicial control spectrum, prioritizing arbitral finality and party autonomy above almost all else. Its international arbitration law, codified in Chapter 12 of the Private International Law Act (PILA), is renowned for its liberal, arbitration-friendly approach, making it a preferred seat for high-value international construction and infrastructure disputes.

Under Swiss law, an international arbitral award can be challenged on an extremely narrow and exhaustive list of grounds, and any such challenge goes directly to the Swiss Federal Supreme Court, ensuring a swift and final decision. These grounds are almost exclusively procedural in nature and mirror those in the New York Convention. They include the improper constitution of the tribunal, a wrong decision on jurisdiction, the award ruling on matters beyond the scope of the claims (ultra petita), or a violation of procedural public policy, such as the right to be heard or the principle of equal treatment of the parties.

Crucially, a challenge based on a violation of substantive public policy (i.e., that the result of the award is incompatible with fundamental legal and moral values) is almost impossible to sustain. The Swiss Federal Supreme Court has consistently held that it will not review the merits of an award, even if the arbitrators have made a manifest error of fact or law. This unwavering commitment to the finality of the arbitral process provides parties with a high degree of legal certainty, assuring them that, absent a fundamental procedural defect, the dispute ends with the award.

C. The UK Approach: Judicial Review and Specialized Courts

The United Kingdom offers an institutional model for overseeing public contracts, characterized by a clear distinction between the review of a public body's decision-making process and the resolution of a contractual dispute. Challenges to decisions made during a public procurement process—such as the award of a contract—are typically brought not as a contractual claim but through a statutory claim under the Procurement Act or, in limited circumstances, via a claim for judicial review. Judicial review is a remedy of last resort, available on grounds of illegality, irrationality, or procedural impropriety in the public body's actions.

A key strength of the UK system is its institutional specialization. The Technology and Construction Court (TCC), a specialist division of the High Court, is dedicated to hearing complex construction, engineering, and technology disputes, including procurement challenges. This ensures that cases are adjudicated by judges with deep subject-matter expertise, leading to more consistent and sophisticated jurisprudence.

Where a public construction contract contains an arbitration clause, the English courts' role is generally supportive. They will typically stay any court proceedings initiated in breach of such a clause. The arbitral award itself is not subject to judicial review. Instead, it can be challenged only under the limited grounds set out in the Arbitration Act 1996, which are primarily procedural and do not permit a review of the merits. This creates a clear demarcation: the TCC and the Administrative Court police the public law compliance of the procurement process, while the arbitral tribunal resolves the contractual dispute, with its award subject to only minimal judicial scrutiny.

These comparative models reveal a spectrum of approaches to judicial control. Switzerland offers near-total finality, France provides specialized and targeted review of core public law principles, and the UK utilizes institutional specialization to separate public law oversight from private contractual dispute resolution. Türkiye is currently charting a course that appears to be moving away from a history of broad judicial intervention towards a model that has parallels with the French approach—a substantive public policy review—but it currently lacks the institutional specialization of the UK or the clear jurisdictional lines of the French dualist system.

Table 1: Comparative Analysis of Judicial Review Grounds for Public Contract Awards

Jurisdiction	Primary Ground(s) for Court Intervention	Reviewing Body	Scope of Review	Key Case / Statute
Türkiye	Violation of "Public Policy"	Court of Cassation (on appeal)	Narrowing interpretation; moving from broad review to only fundamental principles of the legal order.	IAL No. 4686; Court of Cassation Decision No. 2019/2474
France	Violation of Mandatory Rules of French Public Law	Conseil d'État (for administrative contracts)	Limited to core public law principles; no review of merits or application of private law.	Société Fosmax LNG (2016)
Switzerland	Exhaustive List of Procedural Grounds (e.g., jurisdiction, right to be heard, procedural public policy)	Swiss Federal Supreme Court	Extremely narrow; substantive review is excluded.	Chapter 12, Private International Law Act (PILA)
UK	Illegality, Irrationality, Procedural Impropriety (for procurement decisions); Limited grounds under Arbitration Act (for awards)	Technology and Construction Court (TCC) / Administrative Court	Review of the public body's decision-making process (Judicial Review) vs. review of the arbitral award itself.	Procurement Act 2023; Arbitration Act 1996

V. Towards a Harmonized Framework: A Proposed Model for Turkey

Synthesizing the analysis of Türkiye's domestic framework and the insights drawn from comparative international practice, it is possible to formulate a series of reforms aimed at enhancing legal certainty, resolving jurisdictional ambiguities, and solidifying Türkiye's position as a premier seat for construction arbitration. A harmonized framework should seek to protect fundamental public interests without unduly sacrificing the finality and efficiency that are the hallmarks of arbitration.

A. Clarifying the Scope of Public Policy

The most significant source of potential uncertainty in Turkish arbitration law remains the "public policy" exception for setting aside awards. While the Court of Cassation has made commendable strides in narrowing its interpretation, this pro-arbitration stance is based on case law and is not yet codified. Lower courts may still occasionally revert to broader interpretations, leading to inconsistent first-instance decisions and unnecessary appeals. To remedy this, two paths could be pursued. The first is a legislative amendment to the IAL that provides a more precise definition of public policy, explicitly stating that it is confined to fundamental principles of the constitutional order, mandatory rules serving the most essential interests of the state, and basic principles of morality, and that a mere error of law or fact does not constitute a violation. The second, and perhaps more immediate, path would be for the General Assembly on the Unification of Judgments of the Court of Cassation to issue a new, binding unification decision that formally adopts and codifies the narrow interpretation seen in its recent jurisprudence, providing clear and authoritative guidance to all Turkish courts.

B. Learning from the French Fosmax Doctrine

The French Conseil d'État's approach in the Fosmax case offers a sophisticated model for handling public contract disputes. It distinguishes between general errors of law (which are left to the arbitrators) and violations of non-derogable, mandatory rules of public law (which warrant judicial intervention). Turkish courts could be encouraged to adopt a similar analytical framework. When reviewing an award involving a public entity, the public policy inquiry should not be a general assessment of the award's correctness. Instead, it should be a targeted question: does this award compel a public body to act in a way that violates a fundamental and mandatory principle of Turkish administrative or public law? This could include, for example, principles related to the alienation of public property, the core prerogatives of the state in public service contracts, or mandatory procurement rules designed to prevent corruption. Adopting such a doctrine would allow for the protection of essential public interests while respecting the vast majority of the arbitral tribunal's decisions on contractual and technical matters.

C. The Case for a Specialized Construction Court

The complexity of modern construction and infrastructure disputes requires a high degree of subject-matter expertise not only from arbitrators but also from the judges who supervise them. The UK's Technology and Construction Court (TCC) stands as a leading example of the benefits of judicial specialization. Türkiye could significantly enhance the quality and consistency of its arbitration-related jurisprudence by establishing a specialized chamber within the commercial divisions of its major regional appellate courts (which hear set-aside applications at first instance). This chamber would be dedicated to handling all matters related to construction law and arbitration, including applications for interim measures, arbitrator appointments, and actions for the annulment and enforcement of awards. Over time, this would cultivate a body of judges with deep expertise in both construction law and international arbitration practice, leading to more predictable, sophisticated, and internationally respected decisions.

D. Reconsidering Dispute Boards

The common practice in Türkiye of amending FIDIC contracts to remove Dispute Adjudication Boards (DABs) is counterproductive, particularly in public projects. These boards are a proven mechanism for dispute avoidance and early resolution, which helps keep projects on schedule and within budget—outcomes that are of paramount importance to the public interest. The state, as the largest employer in infrastructure projects, is in a unique position to reverse this trend. Public procurement authorities could amend the standard tender requirements to mandate the inclusion of a functioning DAB/DAAB mechanism in all major public works contracts. Promoting the use of dispute boards as a matter of public policy would not only align Türkiye with international best practices but would also reduce the number of disputes that escalate to costly and time-consuming arbitration, ultimately saving public funds and ensuring the timely delivery of critical infrastructure.

VI. Conclusion: Cementing Turkey's Position as a Global Arbitration Hub

Türkiye has undertaken a remarkable and policy-driven transformation of its legal framework for construction and infrastructure arbitration. Through constitutional amendments, modern legislation, and the establishment of a credible national institution in ISTAC, it has decisively moved to embrace arbitration as the primary mechanism for resolving disputes in this vital sector. The Turkish judiciary, led by the Court of Cassation, has played a crucial role in this process, developing a sophisticated and narrow interpretation of public policy that supports the finality of arbitral awards and aligns with international standards. This concerted effort has significantly enhanced Türkiye's appeal as a seat for international arbitration.

However, the journey is not complete. The future success of Türkiye as a leading arbitral jurisdiction hinges on its ability to resolve the remaining jurisdictional ambiguities and achieve a stable, predictable, and sophisticated equilibrium between the principles of party autonomy and the state's legitimate interest in judicial oversight. The current framework, while largely effective, still contains pockets of uncertainty that can be addressed through targeted reforms.

By codifying the narrow scope of public policy, adopting a principled and limited standard of review for public contract awards inspired by international best practices, fostering judicial specialization through the creation of a dedicated construction court, and promoting dispute avoidance mechanisms as a matter of public policy, Türkiye can address these remaining challenges. Such reforms would not undermine the public interest; rather, they would safeguard it more effectively by ensuring that disputes are resolved efficiently, fairly, and with finality. By taking these final steps to create a truly harmonized and predictable legal environment, Türkiye can cement its status not merely as a participant, but as a leader in the global construction arbitration community, capable of providing the legal certainty that is indispensable for the financing and execution of the world's most complex infrastructure projects.

About the Author

Hamdi Timuçin Demir is a senior legal executive and accredited arbitrator with over a decade of specialized experience in construction law and international arbitration. As Head of Legal and Compliance at Makyol, he manages the legal strategy for multi-billion-euro infrastructure and PPP projects across Turkey, the EU, and the Gulf region. He has acted as counsel in high-stakes arbitrations under ICC, ICSID, and ISTAC rules. He serves as an arbitrator exclusively at the Istanbul Chamber of Commerce Arbitration Center (ITOTAM). Recognized in The Legal 500's GC Powerlist Türkiye, Mr. Demir is a member of the Istanbul Bar Association, the Chartered Institute of Arbitrators (CIArb), and the Construction Law Commission of the Istanbul Arbitration Center (ISTAC).

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