Ship Hypothéque Under Turkish Law

Introduction

Ships are suitable assets to be a subject of security, due to their economic values. Ship hypothéque is preferred as a security to a required loan, especially in the financing of ship building and sale. In Turkish law, although the general provisions on pledges are regulated in Turkish Civil Law ("TCL"), the legislator further regulated ship hypothéque in the Turkish Commercial Code ("TCC"), considering the unique nature of ships. This article examines the provisions in the TCC regarding the ship hypothéque.

Ship Mortgage as a Pledge on Movable Without Transferring Possession

Pursuant to Article 936 of the TCC, all ships shall be deemed as movables, whether they are registered or not. Thus, regardless of their flag or registry, provisions for movable properties are applicable to all ships if there is no special provision set forth in the TCC.¹