General climate and recent developments
State of legal development
In general terms, how developed are the product regulation and liability laws in your jurisdiction?
Product regulation and liability laws have an important place in Turkey and are, on the whole, aligned with EU law.
Turkish liability laws are divided into two main categories covering product liability and product safety, respectively. With regard to product liability, the Law on Consumers’ Protection (6502) essentially implements the EU Product Liability Directive (85/374/EEC). The key objective of the law is to hold various groups (eg, producers and sellers of goods) liable for any damages caused by defective products. In relation to the protection of consumers’ rights, the Law on Consumers’ Protection is fully compliant with private law.
With regard to product safety, the Law on the Preparation and Application of Technical Legislation for Products (4703) implements the EU General Product Safety Directive (2001/95/EC). The law provides specifications and other compliance criteria for all products – whether consumer goods or industrial products – in order to prevent damage to users. The law generally contains administrative regulations.
Recent developments
Have there been any notable recent developments in relation to product liability law and product safety law in your jurisdiction, including any regulatory changes and case law?
As mentioned, Turkish liability law has developed as two branches – product liability and product safety. Product liability is essentially a field of private law; accordingly, legal developments are slow. The Law on Consumers’ Protection – the primary legislation governing product liability – came into force on 28 November 2013; as a second wave of codification in this field, it has been applied with established judicial decisions for many years.
Product safety, by contrast, is governed by government decrees within the framework of the Law on the Preparation and Application of Technical Literature for Products, which came into effect on 11 July 2001, and its implementing regulations. Accordingly, this field sees frequent developments as various branches of the administration issue new regulations, decrees and communiques. For example, the Ministry of Economy has promulgated numerous decrees concerning, among other things, market supervision and control of products bearing the CE mark. The ministry has also increased controls on the safety of imported products by establishing certain technical requirements that imported products must meet before they can be placed on the Turkish market. In this regard, the Ministry of Economy publishes yearly communiques concerning certain product groups. Similarly, the ministry has proposed certain controls over the safety of exported agricultural products in order to protect Turkish trademarks on international markets.
Legal framework
Legislation
What primary and secondary legislation governs product safety and liability in your jurisdiction?
The Law on Consumers’ Protection (6502) is the primary legislation governing product liability. In addition, the Ministry of Customs and Commerce has issued numerous regulations for products and services targeting consumers under the law (eg, the Subscriber Contracts Regulation and the Regulation concerning Rules of Warranty Certificate Practice).
The Law on the Preparation and Application of Technical Literature for Products (4703) is the primary legislation governing product safety. It is complemented by subordinate regulations that impose technical requirements – in particular, on imported and some exported products.
Regulatory and enforcement authorities
Which government authorities regulate and enforce product safety and liability laws in your jurisdiction, and what is the extent of their powers?
The Ministry of Economy fulfils the duty of supervision and control assigned to it under the Law on the Preparation and Application of Technical Literature for Products with regard to product safety. The ministry also issues key regulations and communiques concerning product safety and has the power, under such regulations, to impose penalties for non-compliance (eg, failure to fulfil notification obligations) – including denying permission to import or export the products at issue and the payment of administrative fines.
The Ministry of Customs and Commerce has a regulatory duty with regard to product liability under the Law on Consumers’ Protection and other legislation, and is accordingly authorised, under such legislation, to issue regulations and communiques in this field. Similarly, the Ministry of Customs and Commerce conducts market controls and can impose administrative fines when necessary.
Liability
Product defects
How is a ‘product defect’ defined in your jurisdiction?
The Law on Consumers’ Protection (6502) provides that a product is defective if, at the time of delivery to the consumer:
· it does not bear one or more features specified on the:
o packaging;
o label;
o promotional material;
o user's manual;
o internet portal;
o advertisements; or
o publications;
· it is not of the quality specified by the seller or determined in technical specifications; or
· it does not satisfy the purpose of use of equivalent goods, thus decreasing or eliminating the benefits that the consumer can reasonably expect from the product – this includes material, legal or economic defects.
With regard to product safety, the Law on the Preparation and Application of Technical Literature for Products (4703) provides that any product put on the market must comply with technical specifications and must be safe. Under the law, technical specifications:
· must consider a public interest, such as:
o human health;
o safety of life and property;
o protection of the environment; or
o animal and plant health;
· must not prevent competition and go beyond their original purpose; and
· must be suitable, proportional, clear and applicable.
Products that do not satisfy these conditions will be deemed defective or malfunctioning.
Causation and burden of proof
How is causation of loss or damage established in relation to product liability claims and where does the burden of proof lie? Can this burden be shifted in any way?
Contrary to the EU Product Liability Directive (85/374/EEC), under the Turkish Code of Obligations (6098), the indemnification obligation arising from defective or flawed products is a fault-based liability – the code provides no strict liability due to a defective product. Accordingly, a party which has suffered a damage due to a defective product must prove:
· the damage;
· the causality; and
· the fault of the manufacturer or concerned party.
By contrast, under the Law on Consumers’ Protection, any party which suffers damages as a result of a defective product may claim these damages from the producer of the product in question without the need for proof of fault. According to the law, the damages arising from defective products are regulated as strict liability. In such cases, the producer or manufacturer may be relieved from liability if it provides proof of relief. A specific regulation governs such cases.
Legal bases for claims
On what legal bases can a product liability claim be brought?
A party who has suffered damages (whether material or non-material) or bodily injury because of a defective or flawed product may bring a claim under:
· the Turkish Code of Obligations;
· the Law on Consumers’ Protection;
· the Regulation on Liability for Damages caused by Defective Products (25137); or
· the Turkish Criminal Code.
Criminal liability
Can a defendant be held criminally liable for defective products?
Section 5 of the Law on the Preparation and Application of Technical Literature for Products prohibits tampering with, forging or improper use of compliance marks or certificates. Violation of this prohibition will trigger administrative penalties. In addition, under Article 207 of the Criminal Code, the use of forged documents as described in the law will constitute the crime of forgery of private documents.
Further, where an unsafe or defective product causes death or injury, liability may be triggered:
· for manslaughter under Article 85 of the Criminal Code; or
· for causing injury under Article 89 of the Criminal Code.
The liability of producers of foodstuff and pharmaceuticals may also be triggered under the “crimes against public health” listed in the Criminal Code.
Liable parties
Which parties can be held liable for defective products?
Liability depends on the law and the damages claimed. A key distinction may be made between product liability and product safety law. Under the Law on the Preparation and Application of Technical Literature for Products (which governs product safety), the producers, authorised representatives, importers and distributors of a product are responsible for compliance with the regulations specified in that law. Under the same statute, assemblers, installers, users (eg, users of products kept in a workplace) and sellers which may be indirectly called producers are also responsible for the safety of products and their compliance with technical specifications.
By contrast, the Law on Consumers’ Protection defines product liability in a narrow sense, limiting it to the producers, importers and sellers of products, and the providers of services.
The Law on Consumers’ Protection also distinguishes between the producer’s liability and the seller’s liability. For example, refund of a defective product may not be claimed from the producer or importer, but may be claimed from the seller. However, the seller is not responsible for any damage arising from a defective or flawed product; instead, the producer or importer is liable.
Limitation of liability
Can liability be excluded or mitigated in any way?
Turkish law does not provide for the possibility to disclaim liability in advance. However, under the Regulation on Liability for Damages Caused by Defective Products, the producer, manufacturer or importer may not be found liable in the following circumstances:
· The product has not been launched.
· The product has not been produced for sale or in the course of commercial activities.
· Having considered all facts and circumstances, at the time of launch, the product did not present the defect that caused the damage.
· The technical specification of the product caused the damage.
· The state of the scientific and technological knowledge at the time of the product launch meant that the existence of the defect could not be perceived.
In addition, the producer or manufacturer of a part, forming the whole, is not responsible for the design of the final product or the instructions of use of such product.
Litigation
Procedure
What is the procedure for filing a product liability claim before the courts in your jurisdiction?
A distinction must be made between a claimant who is not a consumer and a claimant who is a consumer. In the first case, the general courts have jurisdiction. In the second case:
· where the amount of the dispute (claim, damage or product value) is less than TL4,570 (approximately €870), the county consumer arbitration panels have jurisdiction;
· where the amount of the dispute is between TL4,570 and TL6,860, the province consumer arbitration panels have jurisdiction; and
· where the amount of the dispute is over TL6,860, the consumer courts have jurisdiction.
According to the Code of Civil Procedures (6100), the parties need not be represented by an attorney in order to file a case. In addition, consumers are exempt from paying the court fee (regulated under the Charges Law (492)); they must pay only for the court mail expenses and expert expenses, totalling around €200.
Interlocutory motions
Can the court issue interlocutory orders or judgments in product liability cases? If so, what rules and procedures apply?
The Code of Civil Procedures applies in the consumer courts and general courts that have jurisdiction over product liability cases. Before filing a case under the code, any of the parties may request a preliminary injunction. This injunction may be in the form of the payment of a certain guarantee in cash from the other party or the performance or non-performance of an action. The claimant may request a guarantee amounting to 15% of the disputed amount, although the court, at its own discretion, may deem this guarantee unnecessary.
Pre-trial disclosure
What pre-trial disclosure/discovery mechanisms are available in product liability cases, if any?
In cases relating to product liability, either party may request a declaratory injunction for evidence from the courts before the case on the merits where there is a risk that evidence may be destroyed, lost or damaged. If granted, the injunction will constitute evidence and a basis for the case to be filed in the future.
In cases relating to product safety, the criminal courts of peace and the public prosecutor's office may order the seizure or withdrawal from the market of the product where the product presents a risk of damage to human health or the environment.
Evidence standards
What evidence is accepted to support claims in product liability cases? What formalities apply to evidence submission?
According to the Code of Civil Procedures, evidence must be submitted to the other party at the time of filing the lawsuit. Evidence may be in the form of expert examination, witnesses, discovery, and, in some cases, oaths. Each piece of evidence must be clearly linked to a material fact. The evidence presented by the parties binds the courts, in compliance with general private law. The courts do not conduct ex officio examinations, except in product safety cases triggering criminal liability; in such cases, the prosecutor's office and the courts can conduct ex officio examinations.
Expert evidence
Under what circumstances will the court appoint an expert to assist it in examining the merits of the case? What rules and procedures apply?
According to the Code of Civil Procedures, expert examination and discovery are the main types of evidence that the parties may rely on. However, such evidence must be submitted or requested at the beginning of the proceedings. The court may not issue an ex officio order in this regard. If the expert examination must be conducted at the scene of the incident, the court may order discovery. If deemed necessary, the court may invite experts to the court, and the court and the parties may question them on their field of expertise. Where criminal liability is triggered in product safety cases, the public prosecutor's office or the criminal courts may order expert examination or discovery at any time.
Can the parties rely on expert witness testimony to support their claims? If so, what rules and procedures apply?
According to the Code of Civil Procedures, the parties may submit expert opinions to the court. However, these are not considered technical evidence. The court takes them into account as an annex to the main petition. The parties may submit expert opinions in writing or orally at any stage of the proceedings.
Class actions
Are class actions or any other collective proceedings available for product liability claims in your jurisdiction? If so, what is the procedure for their formation and what benefits do they afford claimants? Are class actions formed on an opt-in or an opt-out basis?
Under consumer law, the Ministry of Customs and Commerce and consumer organisations are entitled to file class actions, but generally under Turkish law, no class actions are formed on an opt-in or opt-out basis.
Appeals
What rules and procedures govern appeals of court decisions?
According to the Code of Civil Procedures, an appeal may be filed before the regional courts of justice against final decisions and dismissals or grants of preliminary injunctions and preliminary attachments, as well as any opposition decisions. No appeal can be made against decisions involving an amount of TL3,560 or less. However, an appeal is always possible, regardless of amount or value, against decisions issued in non-material damages cases.
Where allowed, appeals against the decisions of the civil chambers of the regional courts of justice and the decisions for revocation of arbitrator decisions must be filed within two weeks of delivery of the decision. The decisions of the regional courts of justice involving an amount of TL47,530 or less are also final.
That said, extraordinary legal remedies are available against final or unappealable decisions where such decisions are deemed not to comply with the applicable law.
Statute of limitations
What is the statute of limitations for filing product liability claims?
While the administrative fines provided for in the Law on the Preparation and Application of Technical Literature for Products (4703) may be imposed by authorised institutions, a person who has suffered a material or non-material damage, or bodily injury may claim these amounts:
· within two years of the date of becoming aware of the damage in accordance with the Code of Obligations (6098) and indemnification obligation; and
· in any case, within 10 years of the start of the action causing damages.
Where the damage has arisen from an action for which criminal law proposes a longer statute of limitations, the longer statute of limitations shall apply.
Within the framework of the Law on Consumers’ Protection (6502), unless a longer period is specified in the law or the contract between the parties, liability from a defective product is subject to a two-year statute of limitations, starting from the date of delivery of the goods to the consumer, even if the defect emerges subsequently. Where the defect has been hidden through gross negligence or fraud, the statute of limitations does not apply. Where the defect constitutes a crime under the Criminal Code, the statute of limitations is:
· 30 years for crimes requiring life imprisonment without parole;
· 25 years for crimes requiring life imprisonment;
· 20 years for crimes requiring at least 20 years’ imprisonment;
· 15 years for crimes requiring five to 20 years’ imprisonment; and
· eight years for crimes requiring no more than five years’ imprisonment or a judicial fine.
Timeframe
What is the typical duration of proceedings in product liability cases?
While cases before the consumer courts may take 12 to 18 months, they may take longer in the general and criminal courts, depending on the courts’ workload. The timeframe before arbitration panels may reach 12 months.
Costs, fees and funding
Can the successful party to the litigation recover court and attorneys’ fees and any other related expenses from the losing party? If so, what rules and procedures apply?
In product liability cases, the Ministry of Customs and Commerce pays for the service and expert fees when the consumer arbitrator panels rule against the consumer. Where the panels find in favour of the consumer, the losing party pays the service and expert fees in accordance with the Law on Collection Procedure of Public Receivables (6183); such fees are recorded as revenue to the budget. Where a consumer court overturns such a decision on appeal, the consumer pays attorneys’ fees according to a tariff set out in the Law on Consumers’ Protection (6502), as well as trial expenses. Where a consumer court upholds a decision in favour of the consumer, the losing party is ordered to pay trial expenses and, if the consumer is represented by an attorney, attorneys' fees according to the minimum attorneys' fee tariff. In the general courts, the losing party must pay attorneys’ fees and trial expenses in accordance with the Advocacy Law (1136) and the Minimum Attorneys' Fee Tariff determined by the Turkish Bar Union.
What rules and restrictions (if any) govern contingency fee arrangements?
Under the Advocacy Law, assuming that a case is free of charge is prohibited and a certain percentage (up to 25%) of the value of the case, subject matter or money awarded may be the object of a contingency agreement. Where no contract is in place to pay the attorneys’ fees, or where such a contract is deemed invalid, the fees are determined depending on the value of the dispute and are no less than the rates given in the Minimum Attorneys' Fee Tariff determined by the Turkish Bar Union. In addition, the Advocacy Law and the Minimum Attorneys' Fee Tariff apply in the determination and appreciation of the attorneys' fees to be imposed by the courts on the other party.
Is third-party litigation funding permitted in your jurisdiction? If so, do any rules or restrictions apply?
Turkish law does not provide for the payment of trial expenses and court fees by a third party. In addition, while attorneys' fees contracts made with third parties will be deemed invalid, the payment of such fees applies only to the losing party.
Is legal aid (ie, public funding) available to claimants in product liability cases? If so, what rules, restrictions and procedures apply?
Turkish law does not provide for third-party funding and does not govern public funding. However, where the Ministry of Customs and Commerce files cases before the consumer courts, the consumers and consumer organisations involved are exempt from the charges set out in the Charges Law (492). Where consumer organisations file cases, the ministry pays the expert fee – and the plaintiff’s attorneys’ fees if the case is found in its favour.
Settlement
What rules and procedures govern the settlement of product liability cases?
The settlement provisions of the Turkish Code of Civil Procedures apply in both the general courts and the consumer courts. In the preliminary examination phase, the judge encourages the parties to reach a settlement or go to mediation, in which case, the judge will allocate time to the parties to explore these options. The parties may settle at any point during the proceedings – even after they have been invited to do so by the judge and have declined. If a settlement is reached, the parties may ask the court to issue a decision, in which case, the court’s decision will follow the settlement; where the parties do not request a decision from the court, the court will rule that there is no need to issue a decision.
How common are settlements in product liability cases?
Settlement and mediation are rarely used in product liability and product safety cases.
Alternative dispute resolution
Are any alternative dispute resolution (ADR) methods required or advised before or in lieu of proceeding with litigation?
As stated, within the framework of the Code of Civil Procedures, the judge invites the parties to settle or mediate in the preliminary examination phase. The parties may thus apply to a mediation institution if they wish to do so.
How commonly is ADR used in relation to product liability cases in your jurisdiction?
While mediation has become mandatory in specific areas of Turkish law (eg, labour law), this is not the case in relation to product liability and product safety, where mediation is rarely used.
Defences
Available defences
What defences are available to defendants in product liability cases?
Under the Regulation on Liability for Damages caused by Defective Products (25137), the producer or manufacturer of a product may not be held liable for damages where:
· the product has not been launched;
· the product has not been produced for sale or in the course of commercial activities;
· considering all facts and circumstances, the product is found to have had, at the time of launch, no defect that caused the damage;
· the technical specification of the product has caused the damage; or
· the scientific and technological knowledge at the time of the product launch meant that the defect could not be perceived.
In addition, the producer or manufacturer of a part, forming the whole, is not responsible for the design of the final product or the instructions of use of such product.
An amendment to the Law on Consumers’ Protection (6502) has been proposed to exempt sellers, producers and importers from liability with regard to, among other things, the expiry of a warranty term and user errors.
Preliminary actions
What preliminary procedural mechanisms are available to defendants, if any?
The only preliminary procedures available – namely, preliminary injunctions – tend to benefit the claimants; however, defendants can early on in the proceedings:
· request a declaratory injunction to establish or preserve evidence under the Code of Civil Procedures; or
· seek a declaratory injunction that the product was not defective.
Remedies
Damages
What types of damage may be awarded in product liability cases? What rules and standards govern their calculation? Are damages capped?
With regard to product safety, the Law on the Preparation and Application of Technical Legislation for Products (4703) provides penalties including administrative fines; while under consumer law, where a product or service is defective, the consumer can request:
· a refund;
· a discount proportional to the defect;
· free repair of the product; or
· replacement of the product with a defect-free fungible.
In addition, where the defects constitute a crime under the Criminal Code, the right to material and non-material damages arising from the crime are reserved.
Are punitive damages allowed?
Yes, although the courts rarely allow them. Instead:
· the relevant authorities order administrative fines under the Law on the Preparation and Application of Technical Legislation for Products; or
· where material or non-material damages are proven, the courts can order indemnifications under the Code of Obligations (6098) or the Criminal Code.
Other remedies
Are any other remedies available?
Besides those listed above, no other remedies are available.
Product recalls
General requirements
Are there any statutory criteria under which a product must be recalled or other corrective action be taken?
The Law on the Preparation and Application of Technical Legislation for Products (4703) provides that even if there is documentary evidence that a product complies with the relevant technical requirements, the competent authority will temporarily suspend the launch of the product until a control has been carried out if there are unequivocal signs that the product is unsafe. Where the control determines that the product is unsafe, the competent authority can, at the expense of the producer:
· prohibit the supply of the product to the market;
· withdraw the product from the market; or
· dispose of the product partially or completely, depending on the risk, when it is impossible to make the product safe.
Notification
What rules and procedures govern notification of the product recall to government authorities and the public?
The competent authority must ensure the effective communication of any measures concerning product safety, including:
· disposals;
· prohibitions;
· seizures; and
· information concerning risks to consumers.
Thus, where the communication from the manufacturer is found inadequate, the government will publish the relevant information in two national newspapers and broadcast it on two national television channels. Where the population at risk is in a specific area, the communication can be made through local newspapers and television channels. Where the persons at risk can be identified individually, they can be informed directly.
Repairs, replacements and refunds
What rules and procedures govern repairs, replacements and refunds for defective products?
The Code of Obligations (6098) and the Law on Consumers’ Protection (6502) provide the rights for consumers to request (depending on the degree of defect):
· full refund;
· partial refund proportional to the defect;
· free repair;
· replacement of the product with defect-free fungible; or
· indemnification under general provisions.
Non-compliance
What penalties apply for non-compliance with the legal provisions governing product recalls?
Where a product’s defect constitutes a crime against public health under Article 185 onwards of the Criminal Code and the product has not been withdrawn from the market following an administrative order to do so, the producer, seller or importer is liable to imprisonment and fines under Articles 85 and 89 of the Criminal Code if the product endangers human life and causes death or injury.