Concordat (Debt Restructuring) Under Turkish Law

Literally meaning "arrangement of bankruptcy", a concordat is a unique enforcement mechanism under Turkish law, whereby a debtor who is unable to pay their debts or is at risk of being unable to do so at maturity, may enter into a restructuring plan with creditors—provided that the statutory conditions are met. The objective of the concordat is to either ensure payment of such debts or to allow the debtor to avoid imminent bankruptcy. The proposed restructuring plan may involve extending payment deadlines, reducing the amount of debt, or both. In this article, we will define what a concordat is, examine the legal requirements for initiating the process, outline the main procedural stages, and address some of the frequently asked questions.