Amendment To Interest Rules For Loss Of Earning Capacity And Loss Of Support Damages In Turkey

Article 18 of Law No. 7589, published in the Official Gazette No. 33326 dated July 31, 2026, added two new paragraphs to Article 55 of the Turkish Code of Obligations. The amendment forms part of the legislative reforms commonly referred to as the 12th Judicial Reform Package and revises the date from which interest accrues on damages arising from diminished or lost earning capacity and loss of support. Accordingly, the amendment does not apply to every category of bodily injury damages; its scope is limited to the two types of damages expressly specified in the statute. The new provisions also regulate how payments made for the purpose of discharging the obligation before the commencement of the evidentiary stage will be credited against the damages awarded.

The distinguishing feature of the new system is that it separates the period for which earnings are known from the period for which earnings cannot be ascertained. Statutory interest will accrue on damages relating to the first period from the date of the tortious act or other event giving rise to the loss, while interest on damages relating to the second period will accrue from the date of judgment. This distinction may affect the interest claim, expert report, and operative provisions of the judgment, in addition to the actuarial calculation used to determine the amount of damages. In practice, it will first be necessary to determine which events are governed by the new rule and then identify the period to which each portion of the damages relates. This article examines the previous practice, the new interest accrual system, the treatment of payments made before the evidentiary stage, and the events to which the amendment applies.

Previous Practice Regarding Interest

Under the general rule on default set forth in the Turkish Code of Obligations, a tortfeasor is, as a rule, deemed to be in default as of the date on which the tortious act was committed. Before the amendment, interest accrued from the date of the underlying event on the total damages calculated for loss of earning capacity and loss of support. This approach did not distinguish, for purposes of determining the commencement of interest, between losses incurred from the date of the event through the calculation date and losses projected to arise in the future. Consequently, the portion of damages calculated on a capitalized basis for earnings that had not yet become due could also be subject to interest accruing retroactively.

The legislative rationale stated that applying interest from the date of the event to hypothetical future earnings substantially increased the amount of compensation payable. Rather than eliminating the general default rule based on the time at which the loss arose, the legislature chose to divide the calculated damages into separate periods. The date of the event was retained for losses relating to the period for which earnings are known, while the date of judgment was adopted for the future portion for which earnings cannot be determined on the basis of concrete data. The date from which interest accrues therefore varies according to the nature of the data underlying the damages calculation.

The New Interest Accrual System

Under the provision added to Article 55 of the Turkish Code of Obligations, statutory interest will accrue from the date of the tortious act or other event giving rise to the loss on the total damages calculated for the period during which the earnings of the injured party or the deceased supporting person are known. For the total damages calculated for the period during which those earnings cannot be ascertained, interest will accrue from the date of judgment. A single case may therefore involve two separate portions of damages and two different interest commencement dates. In cases governed by the new provision, applying interest to the entire award from a single date may be inconsistent with the statutory language.

The legislative rationale describes the period for which earnings cannot be ascertained as the period during which the data used to determine earnings are not expressly known and the calculation is therefore based on the last known wage. Although this period will generally correspond to the prospective portion of the actuarial calculation, the statute does not define it simply as the “period following the date of judgment.” The distinction between ascertainable and unascertainable periods must therefore be based on the availability of earnings data rather than solely on calendar dates. Payroll records, tax filings, evidence of professional income, and similar documentation may be relevant to determining the ascertainable period in a particular case.

Treatment of Payments Made Before the Evidentiary Stage

The new provision adopts a proportional crediting method for payments made to discharge liability for loss of earning capacity and loss of support before the commencement of the evidentiary stage. Accordingly, a payment will not be deducted from the damages ultimately awarded solely at its nominal amount. Instead, the calculation will take into account the proportion of the loss existing as of the payment date that was covered by the payment. The legislative rationale states that this method was adopted to reduce inconsistencies in practice and preserve a fair balance between the parties. For payments made after the commencement of the evidentiary stage, the rationale explains that the payment, together with the statutory interest accrued thereon, will be deducted from the total damages.

For a payment to qualify for proportional crediting, it must have been made for the purpose of discharging the obligation and before the evidentiary stage commenced. The description accompanying the payment, any settlement or payment agreement, bank records, and correspondence between the parties will therefore become particularly important. If the payment does not clearly identify the category of damages to which it relates, a further dispute may arise as to its allocation between pecuniary and non-pecuniary damages. The calculation must also be reviewable and clearly show the amount of damages as of the payment date and the percentage of that amount covered by the payment.

Impact of the Amendment on Litigation

The new interest regime may make it necessary in practice for expert reports to state separately the damages attributable to the ascertainable and unascertainable periods. If an expert report specifies only the total amount of damages, the court may have difficulty determining the amount on which interest should accrue from the date of the event and the amount on which interest should accrue from the date of judgment. Clearly reflecting the same distinction in the operative provisions of the judgment would also reduce uncertainty in debt collection in Turkey, particularly regarding the calculation of interest during the enforcement of compensation awards. These are not separate procedural rules expressly established by the statute, but practical consequences necessary for the proper application of the new substantive rule.

The interest claim must likewise be structured according to the legal regime governing the particular event. In a case subject to the new provision, requesting interest on the entire amount of damages from a single date may give rise to a dispute regarding part of the claim. Where the amounts attributable to the ascertainable and unascertainable periods cannot be determined when the action is filed, the formulation of the claim must be assessed in light of the circumstances of the case and the applicable procedural rules. Particularly in claims arising from traffic accidents, workplace accidents, and death, the date of the event, calculation date, judgment date, and sources of the earnings data must be considered together.

Effective Date and Transitional Rule

The provision of Law No. 7589 amending Article 55 of the Turkish Code of Obligations entered into force on July 31, 2026, the date on which the Law was published. Under the transitional provision, the new system applies only to tortious acts or other events giving rise to loss that occur after that date. Events occurring before the effective date remain subject to the provisions in force before the amendment. The decisive date is therefore the date on which the tortious act or other loss-causing event occurred, rather than the date on which the action was filed, the expert report was obtained, or the judgment was rendered.

This transitional rule is particularly significant for events occurring before July 31, 2026, where the resulting action is filed or remains pending after that date. The fact that judgment is rendered after the amendment entered into force does not, by itself, make the new interest system applicable. The governing law must first be determined by reference to the date of the underlying event, after which the interest claim and damages calculation must be structured accordingly. Because applying the incorrect regime may generate further disputes extending from the expert calculation through enforcement of the judgment, an early case-specific legal assessment is essential.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.