Last exit before the bridge: Concordat Lawyer Elvan Kılıç wrote a

Lawyer Elvan Kılıç wrote about the things that are known and not known, and misinformation about the concordat declared by companies one after another in recent months.


Concordat, in daily use of the word, is described as a method of salvation that borrowers resort to because they are unable to pay their debts to their creditors. Is this description sufficient for the 'concordat’ process that affects commercial life?

With a simple and accurate definition, we can say that the concordat process is the last chance given to the borrower who has come or is likely to come to the bankruptcy stage. Although concordat always finds its place in the law, we have come across it as a process that has come to life again after the provisions regarding the postponement of bankruptcy have been abolished and the amendments made to our Law No. 7101. Now let's examine this process in detail.

Contrary to common knowledge, it is not only a solution for capital companies, but it can be used for debt of individual companies and even individuals. Borrowers who are unable or likely to be unable to repay their due debts, or their creditors may request a “concordat" from the competent Commercial Court of First Instance. The competent court to apply for is the Commercial Court of First Instance at the residence address of the borrower if the borrower is a person, and if it is a capital company, it is the Commercial Court of First Instance within the jurisdiction where the head office of the company is.


The process starts when the borrower duly completes the application documents related to his indebtedness and submits them to the Commercial Court of First Instance. In case there is no deficiency in the requested documents, the court firstly gives a temporary deadline decision. There is no right to appeal against the decision of temporary deadline. Temporary deadline is three months, and can be extended to five months when necessary.

During the temporary deadline period, activities are carried out in accordance with the bankruptcy agreement project under the supervision of the concordat commissioners and these activities are reported to the related court. This three-month process is spent by trying to prove to the concordat commissioner and creditors that the borrower can, so to speak, be reborn. For the borrowers who can prove that they have the means to pay their debts spread over a period of time, a definite deadline of one year is given at the end of the temporary deadline.

In the period of three months of temporary and one-year definite deadline, execution and bankruptcy proceedings cannot be initiated against the debtor, and the proceedings which were already started stop, and so the debtors can take a sigh of relief. The process, which we talked about without going too far into the details, while being a relief for the commercial life, it has also started to become a bleeding wound; because, with the activation of the bankruptcy agreement process, there are many companies that abuse this opportunity as well as borrowers who are trying to gain time to pay their debts.

In this case, even the borrowers who are able to pay on time benefit from the three month and one year period, by making adjustments to the required documents. In this way, they can have discount and installment opportunity by making agreement with the creditors for debts they have to pay at once. Creditors, on the other hand, try to provide opportunities to save the situation as much as possible in case the debtor goes bankrupt and their receivables become doubtful. Causing this situation unfairly makes it difficult for the creditor. In my opinion, in order to prevent abuse of the process, it is undoubtedly an appropriate practice to impose penal sanctions or increase control mechanisms on borrowers who are found to have carried out the concordat process with malicious intent.

Although there are negative examples, positive ones should not be ignored. It is seen that the borrowers, with the improvement in their performance and financial values, begin to return to their former activities by removing the demand for bankruptcy agreement without waiting for the end of the concordat process. It is an undeniable fact that the concordat has become a savior.

In the light of the aforementioned, when conducting the concordat process, choosing an attorney with sufficient qualifications will provide you with the best guidance to show you the last exit before the bridge.