The clause that foreign-owned companies in Turkey most often ask me to enforce, and that I most often have to tell them they cannot, is the non-compete. The template comes from the group, runs for three years across the whole country and every line of business, carries no payment and a penalty of a year's salary, and is signed by every employee from the plant manager to the receptionist. Turkish law upholds almost none of that. The Code of Obligations enforces a post-employment non-compete only where the employee had access to customers, production secrets or the employer's affairs and their use could cause significant harm, limits it in place, time and type of work, caps it at two years absent special circumstances, lets the judge cut it down, and ends it where the employer terminated without just cause. Confidentiality is treated differently and more generously: the duty of loyalty during employment, the duty to keep secrets after it, unfair competition and the Criminal Code protect information without any clause at all. Directors and managers sit under separate rules in the Commercial Code. This page sets out what binds whom, from the statutes, and how to draft for each category.
Sources, checked 11 September 2026. Turkish Code of Obligations No. 6098, Articles 27, 179 to 182, 396, 420 and 444 to 447; Turkish Commercial Code No. 6102, Articles 4, 55, 56, 396, 613 and 626; Labour Law No. 4857, Article 25; Turkish Criminal Code No. 5237, Article 239.
During employment: loyalty without a clause
Article 396 of the Code of Obligations imposes the duties that need no drafting. The employee must perform the work with care and act loyally in protecting the employer's legitimate interests; must not, while the employment lasts, serve a third party for remuneration in breach of that loyalty and in particular must not compete with the employer; must not, while the employment lasts, use for their own benefit or disclose to others information learned in the course of the work, in particular production and business secrets; and must keep secrets after the employment ends to the extent the employer's legitimate interests require. Article 25(II)(e) of the Labour Law lets the employer terminate without notice for conduct incompatible with honesty and loyalty, naming the abuse of trust, theft and the disclosure of the employer's professional secrets. The employer therefore holds, during employment, a statutory non-compete and a statutory confidentiality duty, and after employment a statutory confidentiality duty measured by its legitimate interest; the contract adds precision, evidence and a penalty, not the obligation itself.
After employment: the four conditions of Articles 444 and 445
Article 444 allows an employee with capacity to undertake in writing not to compete with the employer after the contract ends, in particular not to open a competing business, work for a competitor or enter into another interest in one, and makes the undertaking valid only where the employment gave the employee the opportunity to learn about the employer's customer base or production secrets or the employer's affairs, and the use of that knowledge could cause the employer significant harm. Article 445 forbids limits in place, time and type of work that would unfairly endanger the employee's economic future, caps the duration at two years except in special circumstances, and lets the judge limit an excessive clause in scope or duration, weighing all the circumstances and any consideration the employer undertook to pay. Four consequences follow for drafting. The clause must be in writing and signed by the employee. It binds only employees whose position actually gives access to customers, secrets or the business, so the receptionist's clause is void and the sales director's is not. It must name a territory, a period and a line of activity that match the harm, since the judge will cut anything wider. And a payment during the restricted period is not a statutory condition, but the judge weighs it, and a paid clause survives where an unpaid one is cut.
| Question | Turkish rule | Article |
|---|---|---|
| Non-compete during employment | Statutory, no clause needed | Code of Obligations 396(3) |
| Confidentiality during and after employment | Statutory, after employment to the extent of the employer's legitimate interest | 396(4) |
| Post-employment non-compete: form | Written undertaking by an employee with capacity | 444(1) |
| Validity condition | Access to customers, production secrets or the employer's affairs, and possible significant harm | 444(2) |
| Limits | Place, time and type of work; two years unless special circumstances; judge may cut | 445 |
| Breach | Full damages; penalty releases the employee unless otherwise agreed, excess loss recoverable | 446(1), (2) |
| Injunction | Only if expressly reserved in writing and justified by the interests and conduct | 446(3) |
| End of the clause | No real interest of the employer; termination by the employer without just cause or by the employee for a reason attributable to the employer | 447 |
| Penalty against the employee alone | Void in general; the non-compete penalty is contemplated by Article 446(2) | 420, 446 |
| Board member of a joint stock company | Needs the general meeting's permission to do business in the company's field | Commercial Code 396 |
| Manager of a limited liability company | No competing activity unless the articles allow or all shareholders consent in writing | 626(2) |
| Trade secrets | Unfair competition remedies and criminal liability, without any clause | Commercial Code 55, 56; Criminal Code 239 |
Breach, penalty and injunction: Article 446
Article 446 provides that an employee who breaches the non-compete must compensate all the employer's resulting loss; that where the breach is tied to a penalty and the contract does not provide otherwise, the employee may free themselves from the non-compete by paying the penalty, while remaining liable for loss exceeding it; and that the employer may demand the cessation of the breach only where it expressly reserved that right in writing in the contract and the importance of its threatened interests and the employee's conduct justify it. Three drafting points follow. The contract must say that payment of the penalty does not release the employee, or the penalty becomes a buy-out price. The contract must expressly reserve the right to an injunction, or the employer is left with damages. And the penalty must be set with the merchant rule in mind: the employee is not a merchant, so the judge may reduce an excessive penalty under Article 182(3), and Article 420 voids penalties stipulated only against the employee, a rule the courts reconcile with Article 446(2), which itself contemplates a penalty in the non-compete, but which still counsels a figure the employer can defend. The general penalty rules are on the penalty clauses page.
When the clause dies: Article 447
Article 447 ends the non-compete where it is established that the employer no longer has a real interest in maintaining it, and where the contract is terminated by the employer without just cause or by the employee for a reason attributable to the employer. The second sentence is where most enforcement attempts fail: a company that dismisses a sales manager in a restructuring, or that lets a key employee resign after months of unpaid bonuses, has lost the non-compete before it sends the first letter. Termination for just cause under Article 25 of the Labour Law preserves it; termination with notice for operational reasons does not. Disputes under Articles 444 to 447 are commercial cases under Article 4(1)(c) of the Commercial Code and are heard by the commercial courts, which is why the file needs the same documentary discipline as a supply dispute. The wider employment rules for a foreign employer are on the employment law page.
Directors, managers and shareholders
Board members of a joint stock company are bound by Article 396 of the Commercial Code: without the general meeting's permission a board member may not carry out, for their own or another's account, a commercial transaction of the kind that falls within the company's business, nor join a company engaged in the same kind of business as a partner with unlimited liability; the company may claim damages or treat the transaction as made on its own account and claim the benefits, by decision of the other board members, within three months of learning of it and at most one year after it occurred. Managers of a limited liability company are bound by Article 626(2): unless the articles provide otherwise or all the other shareholders consent in writing, they may not engage in any activity competing with the company, and the articles may substitute a general meeting resolution for the shareholders' consent; Article 613 lets the articles impose a non-compete on the shareholders themselves. These duties end with the mandate; a post-mandate non-compete for a director or manager is a matter of contract, tested against the general limits of Article 27 rather than Articles 444 to 447, which govern employees, unless the director is also employed. The personal exposure of directors in other respects is on the signing authority page.
Trade secrets without a clause
Turkey has no separate trade secrets statute; protection is assembled from three sources. Article 55 of the Commercial Code lists the principal cases of unfair competition, including inducing employees and agents to disclose or obtain the secrets of their employer or principal, exploiting another's work product without authority, and unlawfully disclosing production and business secrets, in particular by exploiting or passing on information obtained secretly and without permission or otherwise unlawfully; Article 56 gives the injured party actions for a declaration, prohibition, removal of the unlawful state, damages and, for fault, moral damages, and the disgorgement of the wrongdoer's gain in lieu of damages. Article 239 of the Criminal Code punishes, on complaint, the disclosure to unauthorised persons of commercial, banking or customer secrets and of scientific discoveries and industrial applications learned by virtue of one's position, profession or trade, with a heavier penalty where the disclosure is to a foreigner not resident in Turkey. And Article 396 of the Code of Obligations, set out above, binds the employee after employment to the extent of the employer's legitimate interest. A confidentiality clause therefore does not create the duty; it defines what counts as a secret, fixes the return and deletion of documents, names the persons who may be told, and attaches a penalty, which is where its value lies.
Drafting for the employer
Confine written non-competes to employees whose role meets Article 444(2), and say in the clause what access the role gives. Name the territory, the period, at most two years, and the products or services covered, and no more. Pay something during the restricted period where the employee matters, so that Article 445(2) weighs in the employer's favour. State that payment of the penalty does not release the employee and expressly reserve the right to an injunction under Article 446(3). Set the penalty at a level the judge will not cut. Write the confidentiality clause separately, without a time limit, with a definition of secrets, a return and deletion obligation and a penalty, and remember that Article 396 already binds the employee to loyalty and secrecy while employed. And where the company terminates, do so for just cause where the facts allow and document them, since Article 447 otherwise releases the employee.
Drafting for the employee or the hiring company
A company hiring from a competitor should read the candidate's clause against the four conditions: role, territory, period and type of work. It should ask whether the candidate was dismissed without just cause or left for a reason attributable to the employer, which ends the clause under Article 447. It should check whether the penalty is a release price under Article 446(2). And it should keep the candidate away from the former employer's documents and data, because the unfair competition and criminal rules bind the new employer that exploits the information, whatever the non-compete says.
When the clause is tested
A non-compete case turns on the written undertaking, the evidence of the employee's access under Article 444(2), the proportionality of the limits under Article 445, the manner of termination under Article 447 and the wording of the penalty and injunction provisions under Article 446. A trade secrets case turns on proof that the information was secret and was taken or used unlawfully, on the correspondence and the systems logs. Both go to the commercial court, after the mediation that Article 5/A of the Commercial Code requires for monetary claims. The legal function these pages belong to is described on the outsourced legal counsel page, and the terms that bind the company's customers on the standard terms page.
Whose side we are on, and how we are paid
The group's template was drafted for another legal system and signed by everyone. The human resources manager terminated the sales director with notice to avoid an argument, and released the non-compete with the same letter. The new employer took the customer list along with the employee and now faces an unfair competition claim. None of them is paid to tell you, before the signature or the termination, that the clause binds only some of your staff, that the way you terminate decides whether it survives, or that the secret was protected without any clause and the clause protected nothing.
We take no commission or referral fee from recruiters, counterparties or employees, in any form, on any file. The fee you pay us is our only income from your matter, and it does not depend on whether a clause is enforced or a claim is brought. Because our position does not move with the outcome, telling an employer that its non-compete is void, or a hiring company that its new recruit is bound, costs us nothing to say.
One boundary, stated plainly. We are lawyers, not licensed investment advisers and not recruiters. We do not decide whom you hire or dismiss. What we protect is the Turkish legal position: a clause that meets Articles 444 and 445, a penalty and an injunction right that survive Article 446, a termination that does not trigger Article 447, and secrets protected by the rules that need no clause.
Before the next contract is signed or the next employee leaves
Send us the employment contracts, the group's template, the role descriptions of the employees concerned and, where someone has already left, the termination correspondence. We will tell you which clauses bind under Turkish law, which will be cut, what the termination did to them, and what step protects the company's information now. Our corporate work is described on the corporate law page.
What this page does not settle
Non-compete clauses in distribution, agency, franchise and shareholder agreements, competition law limits on such clauses, garden leave and notice periods, the employee's own claims on termination, patents, designs and copyright, data protection duties in investigations, and the conduct of litigation are separate subjects. Whether a particular limit is excessive is decided by the court on the facts.
