The Law Applicable to the Goodwill Indemnity Claims Arising From Exclusive Distributorship Agreement Under Turkish Private International Law

In Türkiye, a country characterised by the prevalence of exclusive distributors, several issues frequently arise concerning goodwill indemnity claims involving a foreign element. These issues include determining the applicable law, the international jurisdiction of Turkish courts, and the arbitrability of such claims. The fact that the Turkish Commercial Code numbered 6102 explicitly stipulates that “goodwill indemnity claims cannot be waived in advance” in a mandatory manner raises the debate as to whether this provision is an overriding mandatory rule. Whether the provision in question is an overriding mandatory rule is a critical issue in determining the applicable law. This is due to the application of overriding mandatory rules to all disputes, irrespective of the presence of a foreign element. Moreover, choice of law agreements are possible in the field of contracts where the principle of party autonomy is recognised. The aim of this article is to analyse the implications for Turkish private international law arising from the selection of a governing law that either precludes goodwill indemnity claims or permits the waiver of such claims in advance. Additionally, this article will seek to clarify how to determine the applicable law in situations where no choice of law has been made, in accordance with the Turkish Act on Private International Law and Civil Procedure of 2007 no. 5718.