NEWSLETTER-2017

151 ARBITRATION LAW conducted. As a matter of fact, in some of its decisions, the Court of Cassation makes use of statements implying that the matters not pertaining to public policy are arbitrable 7 . In a decision of the General Assembly on the Unification of Judg- ments dated 1994, an arbitration agreement is defined as an agreement whereby natural or legal persons leave the resolution of their disputes that are not subject to public policy, which have arisen or are to arise, to one or several arbitrators 8 . One of the interesting decisions of the Court of Cassation on this matter concerns a dispute upon which the arbitrators decided on an issue of value added tax (“VAT”) during arbitration proceedings. In the relevant arbitration proceedings, the arbitrators decided that the claimant shall be entitled to the right of recourse from the other party with regard to VAT paid by the claimant. In the enforcement phase concerning this arbitral award, at the end of the enforcement lawsuit, the court of first instance admitted the request of enforcement 9 . On the other hand, the Court of Cassation, on its review, reversed the decision of the court of first instance, stating that the arbitral award concerns a taxation issue, and, as a result, it relates to public policy and it is subject to administrative jurisdiction, and it, therefore, reversed the decision of the court of first instance. This decision is open to criticism as the relevant arbitral award does not directly relate to tax issues, but to the right of recourse of the tax amounts paid by one of the parties from the other party. This issue is among the issues that the parties may freely dispose of, and it may not be asserted that this is a public policy issue. 7 “On the other hand, the parties to an agreement may choose to resolve the dis- putes not subject to public policy, and which are subject to their own will, through arbitration.” The Decision of the 11th Civil Chamber of the Court of Cassation dated 12.04.2005 and numbered 2004/6686 E., 2005/3600 K. Source: www.ka- zanci.com . 8 Decision of the General Assembly of the Unification of Judgments of the Court of Cassation dated 28.01.1994 and numbered 1993/4 E., 1994/1 K. Source: www. kazanci.com . 9 The decision of the Istanbul 3rd Commercial Court dated 25.07.2005 and num- bered 2004/922 E., 2005/646 K. Source: Huysal, p.198.