Applicable law and international jurisdiction of Turkish courts in disputes arising from goodwill indemnity

One of the consequences arising from the termination of contracts such as agency or exclusive distributorship is the right of the agent /sole distributor to be indemnified, in return of client portfolio created by them, subject to the certain conditions (TCC Art. 122). The most remarkable characteristic of goodwill indemnity is that it may not be derogated by the parties before the termination of the contracts, resulting from its mandatory nature. Accordingly, in this study the disputes arising from goodwill indemnity claimed before the Turkish courts have been examined in the axis of conflict of laws and international procedural law considering the legal nature, ratio legis and the way of implementation in the adapted of law of the cited article. This study mainly focuses on the matters regarding the applicability of the TCC Art. 122 versus the foreign legal systems to be applied contractual relations such as agency and sole distributorship. In particular, matters regarding whether the Art. 122/4 could be applied to the relevant disputes in the context of the positive effect of public order or in the status of a directly applied rule (mandatory rule) in cases where the foreign legal system to be applied to the said permanent contractual relations does not grant goodwill indemnification (portfolio compensation) or where the prior waiver from the goodwill indemnity is valid under this law system are examined; and in case if there is an arbitration clause or a jurisdiction clause in the contract in addition to the provisions on derogation and choice-of-law, the issue of the effectiveness and validity of that clauses are explained.