It is common in enforcement practice for a debtor to transfer a property, a vehicle or a business to relatives once enforcement proceedings have begun. When the creditor arrives to attach the asset, it is no longer in the debtor’s name and the land registry shows someone else. The Enforcement and Bankruptcy Code (İİK) gives creditors a remedy against such transactions: the action to annul transfers (tasarrufun iptali davası). Below we cover the conditions of the action, the grounds for annulment, the time limits and the consequences, together with the case law of the Court of Cassation (Yargıtay).
What Is an Action to Annul Transfers (Tasarrufun İptali Davası)?
Under Article 277 of the Enforcement and Bankruptcy Code, the purpose of the annulment action is to have the transactions described in Articles 278, 279 and 280 declared void. Although the Code uses the word “nullity”, the action does not eliminate the transaction as against everyone. The 4th Civil Chamber of the Court of Cassation describes it as an action that gives the creditor a means of collecting his claim, relative in nature and arising from the statute, and not concerned with the asset itself (4th Civil Chamber, E. 2022/3259, K. 2025/3089, 24.02.2025). In other words, the transfer remains valid between the debtor and the transferee, while the creditor may treat the asset as if it still belonged to the debtor for the purposes of enforcement.
Conditions of the Action to Annul Transfers
Certificate of Insolvency
Under Article 277, the action may be brought by any creditor who holds a provisional or definitive certificate of insolvency (aciz belgesi). A definitive certificate shows that the claim could not be collected in full in the enforcement proceedings. A seizure report drawn up at the debtor’s address when no attachable assets are found counts as a provisional certificate under Article 105.
In Court of Cassation practice the certificate is a procedural prerequisite, which the judge examines of his own motion at every stage of the proceedings. The deficiency may be remedied during the proceedings, even at the appeal stage (4th Civil Chamber, E. 2024/2269, K. 2024/6802, 02.07.2024).
Other Special Prerequisites
Besides the certificate, the Grand Chamber of Civil Chambers also requires that the plaintiff has a genuine claim, that the enforcement proceeding against the debtor has become final, and that the challenged transaction was made after the debt arose (Grand Chamber of Civil Chambers, E. 2017/2773, K. 2021/987, 14.09.2021). A transfer made before the debt arose cannot be challenged through this action.
Grounds for Annulment
Gifts and Transactions Without Consideration (Article 278)
All gifts and transactions without consideration made within one year before the date on which the certificate of insolvency, or a seizure report equivalent to it, was issued, or before bankruptcy was declared, are subject to annulment, except for customary gifts. No bad faith on the part of the debtor is required.
The Code treats certain transactions as gifts. Transactions between ascendants and descendants, blood relatives up to and including the third degree, the spouse (even if the marriage ended within the last year), relatives by marriage up to and including the third degree, an adoptive parent and the adopted child, and persons living in the same home are presumed to be gifts unless it is proved that they were made for a consideration corresponding to the real value. The same applies to contracts in which the debtor accepted a very low price compared with the real value of what he gave, and to life annuity, usufruct and lifelong care contracts for which no proper consideration can be proved.
The notion of a very low price is interpreted narrowly. The 4th Civil Chamber did not treat a sale as a gift although there was a difference between the value of the property and the price, because there was no “very low price” in the sense intended by the Code (4th Civil Chamber, E. 2024/1244, K. 2024/5396, 29.05.2024).
A recent amendment should also be noted. Article 278 was amended by Article 2 of Law No. 7571 on 24.12.2025: the look-back period is now one year, and persons living in the same home have been added to the presumption. The earlier text provided for two years. Which text applies to which transactions depends on the transitional provisions, so files in which the transfer took place before the end of 2025 require separate assessment.
Nullity Due to Insolvency (Article 279)
Certain transactions of a debtor who does not pay his debts are also subject to annulment if made within one year before the seizure, the certificate of insolvency or the opening of bankruptcy. These are the granting of a pledge for an existing debt (unless there was a prior commitment to provide security), payments made by means other than money or customary means of payment, payments of debts not yet due, and annotations placed on the land register to strengthen personal rights. The action is not heard if the beneficiary proves that he was unaware of the debtor’s situation.
Annulment for Intent to Harm (Article 280)
This is the ground relied on most often in practice. All transactions made by a debtor whose assets are insufficient to cover his debts with the intent of harming his creditors may be annulled where the other party knew of the debtor’s financial situation and of that intent, or where there were obvious signs from which it should have been known. Enforcement by seizure or bankruptcy must have been initiated against the debtor within five years of the transaction.
The Grand Chamber of Civil Chambers lists the elements as follows: the debtor’s assets were insufficient for his debts at the time of the transaction, the transaction was made to harm creditors, the third party knew or could have known of the debtor’s economic situation and his intent to harm, and the action was brought in time. Subject to the statutory presumptions, the burden of proving the intent to harm lies with the plaintiff creditor (Grand Chamber of Civil Chambers, E. 2017/3002, K. 2021/699, 08.06.2021).
The Code provides two presumptions. Under the first, where the third party is the debtor’s spouse, an ascendant or descendant, a blood or in-law relative up to the third degree, or an adoptive parent or adopted child, he is presumed to have known the debtor’s financial situation and can rebut this only by proving that he was unaware of it. The second concerns a person who takes over a commercial enterprise, or all or a significant part of the commercial goods at a business premises. Such a person is presumed to have known of the debtor’s intent to harm his creditors, and the debtor is presumed to have acted with that intent. The presumption can be rebutted by proving that written notice was given to the plaintiff creditor at least three months before the transfer, or that the notice required by the Code was published.
Against Whom Is the Action Brought?
Under Article 282, the action is brought against the debtor, against those who entered into a legal transaction with the debtor or to whom payments were made by the debtor, and against their heirs. It may also be brought against third parties acting in bad faith. The Code expressly states that the annulment action does not affect the rights of third parties in good faith. In practice, the debtor and the transferee are named as defendants together.
Time Limit for the Action to Annul Transfers
The right to bring the annulment action lapses five years after the date of the void transaction (Article 284). The period is a forfeiture period, which the court takes into account of its own motion. The Court of Cassation held that an action should be dismissed as time-barred where the transaction was made in 1999 and the action was brought in 2013, after the five years had elapsed (17th Civil Chamber, E. 2017/4737, K. 2019/11843, 11.12.2019). The period runs from the date of the transaction, not from the date of the enforcement proceedings.
Consequences of the Action to Annul Transfers
The Creditor’s Power of Enforcement
If the action succeeds, the creditor obtains the power to collect his claim by enforcement against the asset concerned. Where the asset is immovable property, he may request its seizure and sale without any correction of the land registry entry (Article 283/1).
Annulment Limited to the Claim and Conversion into Value
Annulment is ordered only to the extent of the plaintiff’s claim and its ancillary amounts. The Court of Cassation holds that, where the action is converted into a claim for value, the payment must likewise be limited to the claim and its ancillary amounts, and that the whole value of the property should not be ordered against the defendant (4th Civil Chamber, E. 2022/14532, K. 2023/1778, 14.02.2023). If the third party disposed of the asset to someone else before or during the proceedings, the creditor may claim its value, and the defendant’s liability is limited to the value of the annulled transaction (4th Civil Chamber, E. 2023/9821, K. 2025/1708, 04.02.2025).
Good-Faith Donees, Payment and Precautionary Attachment
A donee in good faith is obliged to return only what he still holds at the time of the action (Article 283/6). If one of the defendants pays the plaintiff’s claim, the action is dismissed (Article 281/3). At the creditor’s request, the judge may order a precautionary attachment of the assets subject to annulment against security (Article 281/2), which is important to prevent a further transfer while the case is pending. Annulment actions are heard under the simplified procedure (Article 281/1), and the value of the property or vehicle at the date of the transaction is usually determined by an expert.
Difference from an Action Based on Sham Transactions
Where the transfer between the debtor and the third party was never genuinely intended but is merely apparent, the creditor may also bring an action under Article 19 of the Turkish Code of Obligations on the ground of simulation. The Court of Cassation has held that, in an action based on simulation, the creditor need not initiate enforcement proceedings or obtain a certificate of insolvency, and that the right to bring an annulment action under Article 277 and following of the Enforcement and Bankruptcy Code does not prevent an action under the general provisions on simulation (4th Civil Chamber, E. 2021/1890, K. 2021/7420, 25.10.2021). Proving simulation, however, presents its own difficulties, and the route to follow must be decided on the facts of each case. Where gifts made to defeat creditors also infringe the reserved shares of the heirs of a deceased person, a tenkis action may come into play.
Annulment in Respect of Public Receivables
For public receivables such as taxes, Law No. 6183 provides for a similar annulment action. The 12th Civil Chamber has held that the five-year forfeiture period applies in this action as well, but that no certificate of insolvency is required and it is sufficient that the debtor is unable to pay his debt (12th Civil Chamber, E. 2025/5445, K. 2026/1405, 26.02.2026).
Frequently Asked Questions
Can a transfer be annulled if the debtor transfers his property to his spouse?
A spouse is among the relatives listed in the Code. If the transfer is without consideration, or no consideration corresponding to the real value can be proved, it is treated as a gift and may be annulled if it falls within the period in Article 278. As regards intent to harm, the spouse is also presumed to have known the debtor’s financial situation.
Can an annulment action be brought without a certificate of insolvency?
As a rule it cannot; the certificate is a procedural prerequisite. It is not required in an action based on simulation or in an annulment action concerning public receivables.
Within how many years must the action be brought?
Within five years of the date of the transaction. This is a forfeiture period.
What happens if the third party has sold the asset on to someone else?
The action may be converted into a claim for the value. In that case the third party is liable to pay the value of the asset, limited to the amount of the claim and its ancillary amounts.
Is the action pointless if the transferee acted in good faith?
The Code protects the rights of third parties in good faith. In transactions of a gift nature, however, even a donee in good faith must return what he holds at the time of the action. For persons within the presumptions, such as close relatives, the burden of proving good faith passes to them.
Conclusion
In an action to annul transfers, the outcome often depends on choosing the correct ground for annulment, obtaining the certificate of insolvency in time, not missing the five-year period and structuring the burden of proof correctly. For both the creditor and the person to whom the transfer was made, having the specific circumstances assessed by a lawyer will help prevent an unnecessary loss of rights.
This article is for general information only and does not constitute legal advice.
