Dialogos

Turkey Tightens Bankruptcy Protection Rules as Applications Surge

Published January 27, 2026, 14:00
Turkey Tightens Bankruptcy Protection Rules as Applications Surge

Turkey is tightening the rules for accessing bankruptcy protection following a surge in applications, as authorities believe there is abuse of the debt restructuring tool. Plans to reform the “concordat” system stipulate that a company whose application is rejected will not be able to reapply unless there are significant changes in its financial situation. The plan also includes shortening the temporary period for submitting documents to four months from five, and accelerating the evaluation process by the competent commissioner, who will have to submit a preliminary report within three weeks. The increase in bankruptcy protection applications was observed after the economic crisis of 2018 and has accelerated in the last two years, with over 2,000 applications in 2023 and almost double in 2024. This move comes after comments by Finance Minister Mehmet Simsek, who stated that there are complaints of abuse of the mechanism. In addition, the Public Oversight Authority is investigating auditing firms involved in the bankruptcy protection process and has already revoked the licenses of 10 of them. It is worth noting that the bill has not yet been submitted to parliament and may be amended or withdrawn during the legislative process. The tightening of the rules aims to prevent abuse of the system and protect the interests of creditors.