Since July 2012, business enterprises in Turkey have been legally required to change their longstanding practices due to the recent enactment of two new vital codes. Known as the Turkish Code of Obligations (TCO) and the Turkish Commercial Code (TCC), they are the most effective legislations for regulating the country's commercial landscape. The TCO and the TCC supersede previous codes with a number of significant changes in legal matters.

One of the most significant TCO regulations consists of provisions regarding standardized terms of contracts, which declare the provisions against the opposing party as null and void. Although some aspects of standardized contractual terms were regulated and applied for consumer contracts, it is brand new for commercial contracts in particular.

Standardized terms of contracts are defined with three criteria by TCO. Whether or not they are executed by or between businessmen, all contracts are subject to relevant TCO provisions when they meet a trio of specifications, which are being prepared by one party in advance, being prepared in order to be executed with multiple oppositions; and being executed without being negotiated by the opposing party.

The contracts bearing the aforementioned standards are defined as "standardized terms of contracts" by TCO. Consequently, all provisions in such contracts that are against the opposition party are declared as null and void.

Obviously, the objective of the code is to protect businesses who are forced to sign boilerplate agreements prepared by stronger, domineering parties, without the benefit of negotiation. This usually occurs when businessmen and their legal counsels try to reduce the amount of time and effort spent on paperwork by using document templates, which include the business's contracts and legal matters. It is a common and entrenched practice in corporate culture.

So, the "Big Fish" of the corporate world are expected to be the most affected by these new regulations regarding standardized terms of contracts, since they generally dictate their own boilerplate contracts. Multinational companies comprise the most notable example, due to their global scope and their globally standardized general terms and conditions. Other Big Fish examples include banks, which issue standard loan contracts; franchisors, with their standard franchising contracts; and chain stores, with their standard supply contracts.

It is a common practice on a global scale for multinational companies to prepare their standard terms and conditions in their headquarters and implement them in all the countries of operation. These terms and conditions affect aspects of the business that include employment, business ethics, delivery of goods and services, and confidentially. However, application of some provisions in boilerplate contracts, especially the ones that adversely affect the other party, remain questionable.

Is There Any Solution That Will Provide Applicability of General Terms and Conditions?

Multinational companies operating in Turkey will conduct a major overhaul of all their contracts, especially the boilerplate ones, to determine whether they contain any inapplicable provisions. Additionally, to avoid their standardized terms of contracts from being inapplicable, they are required to prove that the other party is reasonably informed about the contract and its contents, and that said party permits its execution.

In order to follow the aforementioned procedure, companies that dictate their standardized terms of contracts to the parties subject to them will have to restructure their contract procedures according to TCO regulations. Failure to do so would mean that most of their provisions will be declared as null and void. As a result, it would be like as though the general terms and conditions were never executed.

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