Can a foreign investor freeze a Turkish business partner’s assets before filing a lawsuit? Learn about precautionary attachment, interim injunctions, evidence requirements, security, bank accounts, real estate and urgent asset-protection measures in Turkey.

Yes, potentially.

A foreign investor does not always have to wait until the final judgment—or even until the main lawsuit is filed—before seeking protection against the dissipation of assets in Turkey.

Depending on the nature of the dispute, Turkish law provides provisional remedies that may be requested before the main proceedings.

However, the expression “freeze the partner’s assets” can refer to different legal mechanisms.

The two concepts that commonly need to be distinguished are:

• Precautionary attachment, primarily designed to secure qualifying monetary claims;
• Interim injunction, which may protect the subject matter of a broader dispute or preserve the existing situation.

For a monetary claim, Article 257 of the Turkish Enforcement and Bankruptcy Code provides the central statutory framework for precautionary attachment. A creditor holding an unsecured and due monetary claim may seek precautionary attachment of the debtor’s movable and immovable property, receivables and other rights.

The correct remedy therefore depends on what the foreign investor is claiming and what needs to be protected.

Can the Application Be Made Before the Main Lawsuit?

Potentially, yes.

Provisional protection exists precisely because waiting until the conclusion of ordinary litigation can sometimes make a successful judgment practically meaningless.

Consider:

Foreign investor’s alleged claim: TRY 30 million

Business partner’s main asset: TRY 35 million property

Evidence: Partner is preparing to sell the property and transfer the proceeds.

If the investor waits until the end of lengthy proceedings, there may be nothing left against which a judgment can effectively be enforced.

A properly supported provisional application may therefore become critical.

Precautionary Attachment Is Particularly Important for Monetary Claims

Article 257 of the Enforcement and Bankruptcy Code states that a creditor with an unsecured, due monetary claim may obtain precautionary attachment over the debtor’s movable and immovable assets, receivables and other rights.

This can potentially include assets such as:

• Bank accounts;
• Real estate;
• Vehicles;
• Company shares;
• Receivables from third parties;
• Other attachable rights.

But the investor must establish the statutory basis for the requested measure.

The Claim Must Generally Be Monetary

Precautionary attachment is principally a mechanism for securing a monetary receivable.

For example:

Claim: Turkish business partner improperly received TRY 12 million belonging to the investor.

This may potentially support a monetary claim analysis.

By contrast:

Claim: Investor wants recognition that they remain the lawful owner of company shares.

That dispute may require a different form of provisional protection rather than treating it simply as a monetary attachment claim.

Due and Undue Claims Are Treated Differently

For an unsecured monetary claim that has already become due, Article 257 provides the basic precautionary attachment mechanism.

For a claim that has not yet matured, the statutory requirements are more restrictive.

The Code identifies situations such as the debtor having no fixed residence or preparing to hide or remove assets to avoid obligations, fleeing, or engaging in fraudulent transactions that prejudice the creditor’s rights.

The distinction between a due claim and an undue claim is therefore fundamental.

Example: Foreign Investor Discovers Asset Diversion

Assume a foreign investor and Turkish partner jointly own a business.

The investor discovers that the Turkish partner allegedly caused TRY 15 million to be transferred from the company to another entity controlled by the partner.

Shortly afterward, the partner begins selling personal assets.

The investor should immediately determine:

1. Who legally owns the monetary claim;
2. Whether the claim belongs to the investor or company;
3. Whether it is due;
4. Whether it is secured;
5. Which assets belong to the prospective defendant;
6. Whether precautionary attachment requirements are satisfied.

The first issue is especially important.

Company Loss Is Not Automatically the Investor’s Personal Claim

Suppose the Turkish partner improperly removes TRY 20 million from a jointly owned company.

The immediate loss may belong to the company, not personally to the foreign shareholder.

The foreign shareholder cannot automatically say:

“I own 50%, so the partner owes me TRY 10 million personally.”

The legal owner of the underlying claim must first be determined.

This affects who should request provisional protection.

What Evidence Is Required?

Article 258 requires the creditor to present evidence sufficient to persuade the court regarding the claim and, where applicable, the grounds for precautionary attachment. The court may decide whether to hear both parties before ruling.

This makes documentary preparation extremely important.

Potential evidence may include:

• Contracts;
• Bank statements;
• Payment instructions;
• Invoices;
• Accounting records;
• Shareholders’ agreement;
• Corporate resolutions;
• Emails;
• Acknowledgment of debt;
• Expert calculations;
• Asset-transfer evidence.

The investor should not rely merely on allegations that the business partner is “untrustworthy.”

Can the Court Act Without Hearing the Business Partner First?

Potentially.

Article 258 expressly provides the court with discretion concerning whether both parties will be heard before the precautionary attachment decision.

This can be particularly important where advance notice could defeat the purpose of the requested protection.

Can Bank Accounts Be Subject to Precautionary Attachment?

Potentially, where the statutory conditions are satisfied.

The objective is not to punish the business partner.

The objective is to preserve assets against which a qualifying monetary claim may ultimately be recovered.

The amount sought and the scope of the requested protection should therefore correspond to the underlying claim.

Can Real Estate Be Protected?

Potentially.

If the debtor owns real estate, precautionary attachment may potentially extend to qualifying immovable property within the statutory framework. Article 257 expressly refers to movable and immovable property.

The investor should obtain reliable ownership information rather than assuming the partner owns a particular property.

Can Vehicles Be Attached?

Potentially, subject to the statutory requirements and ordinary attachment limitations.

Vehicle ownership information and approximate value can help formulate a proportionate application.

Can Company Shares Owned by the Business Partner Be Targeted?

Depending on the circumstances and legal nature of the rights involved, the debtor’s attachable shareholding interests may become relevant to enforcement and provisional protection.

The investor should distinguish:

shares personally owned by the business partner

from

assets owned by the company.

A shareholder does not personally own the company’s individual bank accounts, machinery or real estate merely because they own company shares.

Can the Foreign Investor Freeze the Company’s Assets Instead?

That is a different question.

If the claim is against the Turkish partner personally, the company’s assets generally should not automatically be treated as the partner’s personal assets.

For example:

Turkish partner owns 60% of Company A.

Company A owns a factory.

The partner’s 60% shareholding and the factory owned by Company A are legally distinct assets.

Corporate personality must be respected.

What If the Business Partner Is Moving Assets to Relatives?

Preserve evidence of the transactions.

Relevant evidence may include:

• Property transfers;
• Vehicle transfers;
• Bank transactions;
• Share transfers;
• Related-party contracts.

Asset transfers to relatives are not automatically fraudulent.

However, timing, price, commercial justification and the relationship between the parties may become important.

What If the Partner Sells Property Below Market Value?

Suppose:

Approximate market value: TRY 25 million

Sale price: TRY 5 million

Buyer: Partner’s sibling

Timing: Immediately after receiving a formal payment demand.

These facts may require urgent investigation.

Preserve:

• Sale records;
• Valuation evidence;
• Payment evidence;
• Relationship between parties;
• Chronology.

What If the Partner Is Sending Money Abroad?

An international transfer does not automatically establish asset dissipation.

But if the investor has a substantial claim and evidence indicates that the prospective defendant is deliberately removing assets to frustrate recovery, the circumstances may become relevant to an urgent application.

The evidence should establish more than speculation.

Security May Be Required

A foreign investor seeking precautionary attachment should also anticipate the issue of security.

Article 259 provides that a party seeking precautionary attachment must generally provide security against potential losses suffered by the debtor or third parties if the attachment later proves unjustified. The statute provides exceptions or judicial discretion for certain claims supported by judgments or judgment-equivalent documents.

Therefore, obtaining provisional protection may require the applicant to provide financial security.

Why Is Security Required?

Precautionary measures can cause significant damage.

An unjustified attachment may:

• Prevent property sale;
• Restrict banking activity;
• Affect commercial transactions;
• Cause third-party losses.

Security helps balance the creditor’s need for urgent protection against the defendant’s risk of wrongful provisional interference.

Foreign Investor Status Does Not Automatically Prevent Protection

The decisive issues are the underlying claim, jurisdiction, evidence and statutory conditions—not simply the applicant’s nationality.

However, international elements may affect procedural issues such as:

• Service;
• Powers of attorney;
• Foreign documents;
• Translation;
• Authentication;
• Security issues.

These should be addressed early.

Precautionary Attachment and Interim Injunction Are Different

Foreign investors frequently use the term “asset freeze” for both.

They should not be confused.

A precautionary attachment primarily secures a monetary claim.

An interim injunction may be appropriate where the dispute concerns matters such as:

• Ownership;
• Shareholder rights;
• Corporate control;
• Specific property;
• Prevention of a particular transaction.

The requested remedy should correspond to the substantive claim.

Example: Disputed Share Transfer

Suppose the Turkish business partner allegedly forges documents transferring the foreign investor’s shares.

The investor’s primary objective may be:

Prevent the disputed shares from being transferred again.

That is not necessarily the same as securing a TRY-denominated debt.

A carefully tailored interim measure concerning the disputed shares may therefore need to be evaluated.

Example: Unauthorized Withdrawal

Suppose the business partner personally received TRY 8 million without legal justification and the evidence supports a monetary repayment claim.

A precautionary attachment analysis may be considerably more relevant.

Can the Investor Freeze Every Asset the Partner Owns?

Not simply because there is a dispute.

Provisional protection should be connected to the claim and proportionate to the amount or right being protected.

If the alleged claim is TRY 3 million, an indiscriminate attempt to immobilize assets worth hundreds of millions may face proportionality concerns.

Do You Need Exact Asset Information?

Knowing the assets can make enforcement considerably more effective.

Prepare an asset map covering:

• Real estate;
• Bank relationships;
• Vehicles;
• Company shares;
• Receivables;
• Other significant rights.

However, the exact procedural requirements depend on the remedy sought.

What If Assets Belong to the Partner’s Company?

Do not automatically treat them as the partner’s personal property.

This distinction is crucial.

Partner owns Company B.

Company B owns TRY 50 million property.

The property belongs to Company B, not directly to the shareholder.

Different legal analysis is required if the investor believes assets have been improperly moved into related companies.

What If the Partner Has Already Transferred the Assets?

Provisional attachment is primarily preventative.

If assets have already been transferred, the investor may need to examine additional remedies depending on:

• Type of transfer;
• Recipient;
• Consideration;
• Timing;
• Knowledge;
• Existing enforcement position.

The earlier the investor acts, the greater the practical possibility of preserving recoverable assets.

Can the Investor Seek Protection Against a Third Party?

This depends heavily on the claim and legal basis.

Do not request a freeze against a relative, spouse or related company merely because of their relationship with the debtor.

Evidence must connect the third party to the relevant legal claim or asset.

What If the Business Partner Owns Assets Jointly With a Spouse?

Ownership must be established accurately.

The investor cannot automatically attach property belonging solely to another person.

Only the debtor’s legally attachable interest should be targeted unless an independent legal basis exists against another person.

Should the Investor Send a Demand Letter First?

This depends on the circumstances.

A formal demand may be legally or strategically useful.

However, where there is credible evidence of imminent asset dissipation, warning the prospective defendant before seeking provisional protection may sometimes create additional risk.

The timing should therefore be considered strategically.

Do Not Threaten an Asset Freeze Without Evidence

Messages such as:

“Pay me tomorrow or I will freeze everything you own.”

are usually unhelpful.

A stronger approach is to prepare:

• Claim documentation;
• Damage calculation;
• Asset evidence;
• Chronology;
• Evidence of urgency.

Then pursue the appropriate legal remedy.

Can a Foreign Investor Obtain Protection During a 50/50 Company Dispute?

Potentially.

For example:

Foreign shareholder: 50%

Turkish shareholder: 50%

If the Turkish shareholder allegedly transfers company money personally and begins disposing of personal assets, there may be multiple layers of litigation:

• Corporate claim;
• Manager-liability claim;
• Shareholder dispute;
• Monetary recovery claim;
• Provisional protection.

The correct claimant must be identified for each remedy.

Manager Liability and Asset Protection

If the business partner is also a company director or manager, misuse of corporate assets may potentially create management-liability issues.

But even where liability appears strong, a final judgment obtained after assets have disappeared may be difficult to enforce.

This is why provisional protection can be strategically important.

What If the Claim Is Based on a Share Purchase Agreement?

Suppose a Turkish business partner agreed to repay USD 1 million following termination of a share purchase transaction but refuses to pay.

The investor should examine:

• Contract;
• Payment evidence;
• Repayment obligation;
• Due date;
• Security;
• Dispute-resolution clause.

A contractual monetary claim may potentially support a different provisional-protection strategy from a pure shareholder-control dispute.

Arbitration Clauses Must Be Checked

Foreign investment agreements frequently contain arbitration provisions.

Before filing any application, review:

• Shareholders’ agreement;
• Share purchase agreement;
• Investment agreement;
• Joint venture agreement.

The existence of arbitration can materially affect the procedural strategy for provisional measures and the main dispute.

Foreign Arbitration Does Not Mean Turkish Assets Should Be Ignored

Where the substantive dispute is being or will be arbitrated, Turkish assets may still require urgent preservation.

The relationship between arbitration proceedings and domestic provisional protection should therefore be analyzed at the beginning of the dispute rather than after the assets have disappeared.

Evidence of Asset Dissipation

Useful evidence can include:

• Recent property listings;
• Transfer agreements;
• Messages stating assets will be moved;
• Bank records;
• Corporate resolutions;
• Below-market related-party transactions;
• Sudden share transfers;
• Repeated large withdrawals.

General fear is weaker than transaction-specific evidence.

Build a Chronology

A strong urgent application should tell a clear story.

For example:

1 September: Investor demands repayment.

4 September: Partner transfers vehicle to related party.

8 September: Property listed for sale.

12 September: Large international transfer initiated.

15 September: Partner states business relationship is terminated.

Chronology can help demonstrate urgency.

Calculate the Claim Precisely

Avoid unsupported round figures.

Separate:

• Principal;
• Contractual amounts;
• Interest where applicable;
• Direct damages;
• Other legally recoverable items.

The amount of provisional protection requested should be defensible.

Wrongful Attachment Can Create Liability

This should not be overlooked.

Article 259 expressly contemplates responsibility for damage suffered by the debtor and third parties where the applicant ultimately proves unjustified, which is also why security is generally required.

Foreign investors should therefore avoid aggressive provisional applications unsupported by evidence.

What Happens After a Precautionary Attachment Decision?

Obtaining the decision is not the end of the process.

Turkish enforcement law imposes procedural requirements concerning implementation and subsequent steps.

Urgent provisional remedies are therefore highly deadline-sensitive.

The investor should prepare the enforcement and main-claim strategy before obtaining the order rather than afterward.

Can the Business Partner Object?

Yes. Provisional measures are not necessarily immune from challenge.

The opposing party may dispute matters such as:

• Existence of claim;
• Amount;
• Statutory requirements;
• Ownership of attached assets;
• Security;
• Procedural issues.

The investor’s initial evidence should therefore be organized as though the measure will be contested.

First 48-Hour Action Plan

A foreign investor concerned that a Turkish business partner will dissipate assets should:

1. Identify the exact monetary or non-monetary claim.
2. Determine who legally owns the claim.
3. Calculate the amount.
4. Determine whether the claim is due.
5. Check whether it is secured.
6. Preserve contracts and payment evidence.
7. Identify assets belonging to the prospective defendant.
8. Preserve evidence of attempted asset transfers.
9. Create a chronology.
10. Review company records.
11. Review shareholders’ and investment agreements.
12. Check arbitration clauses.
13. Determine whether precautionary attachment or interim injunction is the appropriate remedy.
14. Prepare for potential security.
15. Coordinate the provisional application with the main lawsuit or arbitration.

Frequently Asked Questions

1. Can a foreign investor freeze a Turkish business partner’s assets before filing the main lawsuit?

Potentially, yes. Turkish law provides provisional protection mechanisms that can operate before the final resolution of the underlying dispute.

2. What is precautionary attachment?

It is a provisional mechanism designed to secure recovery of a qualifying monetary claim by temporarily attaching assets or rights of the debtor. Article 257 provides the principal statutory conditions.

3. Can bank accounts be subject to precautionary attachment?

Potentially, where the legal conditions for the measure are satisfied.

4. Can real estate be attached?

Potentially. Article 257 expressly includes movable and immovable property within the statutory framework.

5. Does the investor have to prove the entire lawsuit before obtaining protection?

The final merits determination is separate, but Article 258 requires the applicant to present evidence sufficient to persuade the court concerning the claim and, where necessary, the grounds supporting precautionary attachment.

6. Can the court decide without hearing the Turkish business partner first?

Potentially. Article 258 gives the court discretion concerning whether both parties will be heard before the decision.

7. Is security required?

Generally, security should be anticipated. Article 259 regulates security and provides particular exceptions or discretion where the claim is based on specified types of documents.

8. Can the foreign investor freeze company assets for a personal claim against the partner?

Not automatically. Company property and a shareholder’s personal property are legally distinct.

9. What if the dispute concerns ownership of shares rather than money?

A different form of interim protection may be more appropriate. Precautionary attachment is principally designed to secure monetary claims.

10. What is the biggest mistake foreign investors make?

Waiting until the final lawsuit is prepared while concrete evidence shows that the prospective defendant is already transferring assets.

Client-Focused Legal Support for Pre-Lawsuit Asset Protection in Turkey

A strong claim is of limited commercial value if the defendant has no recoverable assets when the final judgment is obtained.

Foreign investors facing serious shareholder, investment or business-partner disputes should therefore assess asset preservation at the beginning of the dispute.

For qualifying monetary claims, Turkish enforcement law expressly provides precautionary attachment mechanisms over the debtor’s movable and immovable assets, receivables and other rights. The applicant must present sufficient supporting evidence and should ordinarily anticipate a security requirement.

The appropriate strategy may involve precautionary attachment, interim injunctions, transaction tracing, preservation of company assets, management-liability proceedings and coordinated litigation or arbitration.

Fırat Fesih Kaya Law Office assists foreign investors and international companies with urgent asset-protection measures, shareholder disputes, unauthorized transfers, management liability and recovery of investment losses in Turkey.

Lawyer Fırat Fesih Kaya provides legal assistance in assessing provisional remedies, preparing evidence, identifying recoverable assets and coordinating urgent protective applications with the underlying corporate or commercial dispute.

Phone: +90 312 434 22 22
Mobile: +90 532 769 22 22
Email: info@firatfesihkaya.av.tr
Address: Mevlana Boulevard No:221, Yıldırım Tower, Office No:148, 06520 Balgat, Çankaya, Ankara, Turkey

This article is intended for general information and does not constitute legal advice. The availability of provisional protection depends on the nature of the claim, maturity and security of the debt, evidence, ownership of the targeted assets, urgency and the specific circumstances of the dispute.