Article 24 MÖHUK – Choice of Law in Contracts

Article 24 of Turkish Law No. 5718 on Private International Law and International Civil Procedure (MÖHUK) is the general rule on which law governs contracts with a foreign element. The parties may choose the applicable law themselves (hukuk seçimi). If they have not, a Turkish court applies the law most closely connected with the contract, which as a rule is the law of the country where the party providing the characteristic performance (karakteristik edim) lives or has its place of business. This affects anyone in Germany or the Netherlands who agrees a sale, a service or a loan with someone in Turkey.

Article 24 MÖHUK – text

Unofficial translation:

Law applicable to contractual obligations
Article 24 – (1) Contractual obligations are governed by the law expressly chosen by the parties. A choice of law that can be inferred beyond doubt from the terms of the contract or the circumstances of the case is also valid.
(2) The parties may agree that the chosen law applies to the whole contract or to part of it.
(3) The parties may make or change a choice of law at any time. A choice of law made after the contract was concluded is valid with retroactive effect, without prejudice to the rights of third parties.
(4) Where the parties have made no choice of law, the contractual relationship is governed by the law most closely connected with the contract. That law is deemed to be the law of the habitual residence of the party owing the characteristic performance at the time the contract was concluded; for contracts concluded in the course of commercial or professional activities, the law of that party’s place of business, or if there is none, of its domicile; and if that party has more than one place of business, the law of the place of business most closely connected with the contract. However, where it appears from all the circumstances that the contract is more closely connected with another law, the contract is governed by that law.

Turkish original:

Sözleşmeden doğan borç ilişkilerinde uygulanacak hukuk
MADDE 24 – (1) Sözleşmeden doğan borç ilişkileri tarafların açık olarak seçtikleri hukuka tâbidir. Sözleşme hükümlerinden veya hâlin şartlarından tereddüde yer vermeyecek biçimde anlaşılabilen hukuk seçimi de geçerlidir.
(2) Taraflar, seçilen hukukun sözleşmenin tamamına veya bir kısmına uygulanacağını kararlaştırabilirler.
(3) Hukuk seçimi taraflarca her zaman yapılabilir veya değiştirilebilir. Sözleşmenin kurulmasından sonraki hukuk seçimi, üçüncü kişilerin hakları saklı kalmak kaydıyla, geriye etkili olarak geçerlidir.
(4) Tarafların hukuk seçimi yapmamış olmaları hâlinde sözleşmeden doğan ilişkiye, o sözleşmeyle en sıkı ilişkili olan hukuk uygulanır. Bu hukuk, karakteristik edim borçlusunun, sözleşmenin kuruluşu sırasındaki mutad meskeni hukuku, ticarî veya meslekî faaliyetler gereği kurulan sözleşmelerde karakteristik edim borçlusunun işyeri, bulunmadığı takdirde yerleşim yeri hukuku, karakteristik edim borçlusunun birden çok işyeri varsa söz konusu sözleşmeyle en sıkı ilişki içinde bulunan işyeri hukuku olarak kabul edilir. Ancak hâlin bütün şartlarına göre sözleşmeyle daha sıkı ilişkili bir hukukun bulunması hâlinde sözleşme, bu hukuka tâbi olur.

The current text on mevzuat.gov.tr carries no amendment note (as of November 2026).

Legislative reasoning

According to the reasoning of the government bill, the article partly corresponds to Article 24 of the old Law No. 2675. The old law recognised only an express choice of law; the new text also accepts an implied choice that can be inferred “beyond doubt” from the circumstances. Without a choice, the old law looked to the place of performance. The reasoning notes that in many contracts this place is a matter of chance, which led to the application of a law with little connection to the contract; the closest connection and the characteristic performance test replaced it. The term “place of business” (işyeri) was chosen because it also covers individuals, but it was deliberately left undefined in the law and left to legal writing and practice.

The reasoning also gives examples of characteristic performance: in contracts transferring ownership of movable property, the transferor’s; in a sale, the seller’s; in contracts for the use of a right or a thing, that of the party granting the use; in mandate and other service contracts, the service provider’s; in deposit contracts, the depositary’s; and in guarantees and suretyships, the guarantor’s or surety’s. The common thread is the party whose performance gives the contract its social content and character.

Explanation

In practice Article 24 answers two questions. Did the parties choose a law? And if not, who performs the main obligation under the contract?

If the choice is written into the contract, things are simple. If there is no such clause, the court looks for an implied choice, which requires a real intention to choose that can be seen beyond doubt. The substantive rules of the chosen law apply, not its conflict rules, unless the parties expressly agree otherwise (Article 2(4) MÖHUK).

Without a choice, the party who pays is usually not the one that counts. In a sale it is the seller’s habitual residence, in a service contract the service provider’s; where the contract is part of a commercial or professional activity, that party’s place of business, or its domicile if it has none. The relevant moment is fixed by the law: habitual residence when the contract was concluded. Moving to another country later does not change the applicable law. The last sentence is an escape clause: if the contract is more closely connected with another law in the specific case, that law applies.

Some contracts are governed by special rules instead of Article 24: contracts relating to immovable property (Article 25), consumer contracts (Article 26), employment contracts (Article 27; paragraphs 1 and 4 were amended by Article 18 of Law No. 7550 of 4 June 2025), contracts on intellectual property (Article 28) and contracts for the carriage of goods (Article 29). Whether a contract exists and is materially valid is governed by the law that would apply if the contract were valid (Article 32(1) MÖHUK).

What this means if you live abroad

Selling from Germany to Turkey. If someone living in Germany sells, say, a used car or a machine to someone in Turkey and no law was chosen, the seller provides the characteristic performance. A Turkish court will as a rule apply German law, because the seller’s habitual residence was in Germany when the contract was concluded. If a business sells in the course of its trade, its place of business counts. Where such a business sells to someone in Turkey buying for purposes outside any trade or profession, Article 26 has to be checked: if one of the conditions listed there is met and no law was chosen, the law of the consumer’s habitual residence applies (Article 26(2)).

Services across the border. If a freelance translator or software developer in Germany works for a company in Turkey, the law of the service provider’s place of business applies in the absence of a choice, or of their domicile if they have no place of business. The other way round, a client in Germany who instructs an accountant (muhasebeci) in Turkey will as a rule be looking at Turkish law.

Loans within the family. This point is debated. Neither the law nor the reasoning mentions loans expressly; what follows is the author’s assessment. Starting from the reasoning’s example of “the party granting the use” of a thing, it can be argued that when a brother in Germany lends money to his brother in Turkey, the lender provides the characteristic performance. Without a choice, the law of the lender’s habitual residence would then apply. But if the money was handed over in Turkey, in lira, for a flat in Turkey, Turkish law may be more closely connected on all the circumstances. In the author’s view, because neither party lends money as a profession, such a loan should not count as consumer credit under Article 26; the wording of that article does not define the other party further. The parties can remove this uncertainty by writing a choice of law into the agreement (Article 24(1)).

Mixed contracts and “place of business”. Where a contract covers both delivery of goods and installation or maintenance, the law does not say which performance is characteristic. The reasoning also left “place of business” to legal writing and practice. Both points are debated; there is no express statutory rule and no binding court decision on them. In the author’s assessment, a mixed contract is judged by the performance that forms its centre of gravity; which test a court will adopt is uncertain.

A choice of law is not a choice of court. “This contract is governed by Turkish law” does not mean the case must be heard in Turkey. Jurisdiction of a foreign court is agreed separately; this is possible for disputes arising from obligations with a foreign element, must be proved by written evidence and is not available where jurisdiction is exclusive (Article 47 MÖHUK). Whether merely naming the competent court amounts to an implied choice of law is not addressed by the law. In the author’s view, that alone is not enough; it matters only if, together with other terms of the contract, it shows an intention to choose beyond doubt.

Limits of the chosen law. Even where a foreign law has been chosen, the overriding mandatory rules of Turkish law apply (Article 6 MÖHUK; see Article 6 MÖHUK). Effect may also be given to the overriding mandatory rules of a third state closely connected with the contract (Article 31 MÖHUK). A Turkish court applies foreign law of its own motion (see Article 2 MÖHUK).

Proceedings in Germany or the Netherlands. This post describes the view of a Turkish court. Courts in EU member states generally determine the law applicable to contracts under Regulation (EC) No 593/2008 (Rome I). For the outcome there, please consult a lawyer admitted in that country.

If you are selling a flat in Turkey or signing an employment contract with an employer in Turkey, Article 25 or Article 27 applies, not Article 24. Other contract topics are covered under commercial and contract law.

Frequently asked questions

Can we agree later that Turkish law applies to our contract?

Yes. A choice of law can be made or changed at any time; a choice made after the contract was concluded has retroactive effect, without prejudice to the rights of third parties (Article 24(3) MÖHUK).

Which law governs a contract with a Turkish link if no law was chosen?

The law most closely connected with the contract; as a rule this is the law of the habitual residence, at the time of conclusion, of the party providing the characteristic performance, such as the seller. For commercial or professional contracts that party’s place of business counts (Article 24(4) MÖHUK).

Can I choose another law when selling a flat in Turkey?

Contracts relating to immovable property or its use are governed by the law of the country where the property is located (Article 25 MÖHUK). For a flat in Turkey that is Turkish law.

Sources

Questions about your case

If you would like to know which law a Turkish court would apply to your sale, service or loan agreement with someone in Turkey where no law was chosen, or what a choice-of-law clause would achieve, you can book a video call, a phone call or a meeting in Düsseldorf on the appointment page, or send a written question through the contact form. Consultations are held in Turkish and cover Turkish law only (§ 206 BRAO); for the position under German or Dutch law and the Rome I Regulation, please consult a lawyer admitted there. Useful to have ready:

the contract, or the messages that show what was agreed,
the date the contract was concluded and the country where each party lived or worked at that time,
any clause on the competent court.