Damages Actions for Investment Fund Losses: Liability of the Portfolio Management Company, the Custodian and the Bank

A claim for compensation for an investment fund loss is assessed according to the specific breach of duty by the founder (kurucu), the manager, the portfolio custodian or the selling bank, the loss connected with that breach, and the question of to whom the right to claim belongs. The reduction in the fund’s common pool of assets and the loss arising from the investor’s personal service relationship should be tracked separately; the correct defendant, the documents of proof and a loss calculation updated for payments should be determined together. Besides the court with subject-matter jurisdiction, mediation, interim protection and the statute of limitations, this review also covers the effect of liquidation and criminal proceedings on the compensation claim. In new actions, the provision on increasing the claim that entered into force on July 31, 2026 should be taken into account, and in earlier files the transitional provision. Law No. 6362, Art. 52–56 [1]; TBK Art. 49, 50 and 112 [2]; Law No. 7589, Art. 19–20 and Transitional Art. 1/10 [3].

How does the fund’s separate pool of assets affect the compensation claim?

To determine the correct defendant in an investment fund loss, it must first be understood which pool of assets has been reduced. The main framework of this review is the funds within the scope of the Communiqué on Principles Regarding Investment Funds No. III-52.1. Since exchange-traded funds, real estate investment funds and venture capital investment funds are outside the scope of this Communiqué, the special regulations concerning them are assessed separately. III-52.1 Art. 1/2 [4].

Article 52 of Capital Markets Law No. 6362 regulates an investment fund as a pool of assets, as a rule without legal personality, in which the assets collected in return for participation shares (katılma payı) are managed for the account of the investors. The limited recognition of legal personality that the Law grants for certain registry transactions does not turn the fund into an independent company in all its relations. Article 53, for its part, separates the fund assets from the assets of the founding portfolio management company and of the portfolio custodian; it provides special protection against these assets being used for other purposes or becoming a source that can be resorted to for the debts of the institutions concerned. Law No. 6362, Art. 52–53 [1].

The consequence of this distinction for the investor is the need to investigate on which legal relationship the fund share balance shown at the bank is based. The assets in the fund’s portfolio and the participation shares held by the investor are not the same asset. It cannot be inferred from the protection of separate assets that the share price will never fall or that the difference will necessarily be made up by the founder. When examining a loss in value, the disclosed investment risks and the effect of the breach of duty should be separated from each other.

The fund’s common loss and the investor’s personal loss

For example, an allegation that a payment without legal basis was made from the fund account primarily raises the issue of a reduction in the fund assets. The incorrect execution of a sell order specific to the investor, or the effect of incorrect information given before the investment decision, may by contrast give rise to a claim of personal loss. These are hypothetical examples: both types of loss may exist together in the same event, or there may be an appearance consisting only of a fall in the share price. The petition should explain from which transaction the loss arose and to whom the requested payment should be made.

Article 56/3 of the Law reserves the right of participation shareholders to bring an action. Nevertheless, it does not follow from this provision that the fund’s entire loss will be paid to each investor separately. The link to be drawn between the common loss and the personal claim should be established by assessing together the representation of the fund, the ground of liability asserted, the investor’s shareholding and how the loss is reflected on that investor. The effect on share value of a collection to be made to the fund account should also not be detached from the personal compensation calculation. Law No. 6362, Art. 52/3 and 56/3 [1].

How should the fund and the defendant institution be identified in the petition?

Writing only the fund’s title or code in the petition does not make clear against whom the claim is directed. Relying on the representation relationship for a debt belonging to the fund account differs from claiming, out of the company’s assets, compensation arising from the founding company’s breach of its own obligations. Article 52/3 of the Law provides that the portfolio management company represents the fund in its own name and for the account of the fund. The relief sought should state from which pool of assets, in whose favor and on which ground of liability the payment is requested. Law No. 6362, Art. 52/3–5 and 56/3 [1].

Capacity to be a party, standing to conduct the proceedings and representative status are examined with respect to the specific claim; the limited recognition of the fund’s legal personality in certain registry transactions cannot be used as a general corporate personality. Nor should it be assumed that naming the wrong defendant will necessarily be corrected later. HMK Art. 124 makes a change of party subject to conditions such as consent, a clerical error or an excusable mistake. HMK Art. 50–53, 119 and 124 [10].

For which breaches may the founder and the portfolio management company be liable?

The founder is responsible for the representation and management of the fund and the supervision of its management, and for carrying out activities in accordance with the fund rules (içtüzük) and the prospectus. Leaving portfolio management to another authorized company or outsourcing services does not remove this responsibility. Therefore, it should be examined not only who actually carried out the transaction alleged to have caused the loss, but also whether the founder fulfilled its own duties. III-52.1 Art. 9 [4].

The founder and the manager may be the same company, or another portfolio management company may take over the management of the fund. In addition, the term “portfolio manager” may refer to a natural person employee within the institution. These statuses should be stated clearly in the claim. If the personal liability of a company executive or employee is to be asserted, then instead of relying solely on their title, their own act, their role in the decision-making process and the applicable ground of liability should be set out specifically. This way, the company’s service obligation and the allegation directed at the natural person do not become mixed up.

Mandate provisions should be applied while preserving the fund exception

The provisions on mandate are important in the fund relationship; however, it should not be assumed that a separate individual portfolio management agreement has been concluded with each participation shareholder. The umbrella fund rules contain standard terms and conditions governing the management and custody relationship between the parties. In matters not provided for in the Law, the relevant legislation and the fund rules, Articles 502–514 of the TBK apply by analogy. Law No. 6362, Art. 52/4 [1]; III-52.1 Art. 8 and 9/3 [4].

Article 34/1 of Communiqué No. III-55.1, while regulating the requirement of a written portfolio management agreement, expressly excludes the funds of which the company is the founder. Therefore, when transposing the provisions of the same article on liability arising from transactions of the managers specified in the agreement, this scope should not be overlooked. The protection of the fund investor should be based not on an individual agreement presumed to have been signed, but on the law, the fund regulations and the legal relationship applicable in the specific case. III-55.1 Art. 34 [5].

Collective portfolio management covers, alongside the selection of assets, tasks such as valuation, calculation of the share price, records and monitoring compliance with legislation. The principles of activity require that investors’ interests be observed and that transactions detached from market conditions and use for the benefit of the institution or third parties be avoided. III-55.1 Art. 32–33 [5]. Within this framework, answers to the following questions may be sought in the specific file:

• Were the fund strategy and investment limits in force on the transaction date observed?
• Were the data and method used in valuing the assets consistent with the disclosed principles?
• Did transactions with related persons or entities serve a purpose different from the fund’s interest?

These questions guide the examination of the breach; it cannot be assumed that every negative answer equals the entire investment loss. For example, when a disputed transaction is identified, the transaction amount, its weight in the fund portfolio and its effect on share value should be shown separately. The fact that a more successful fund can be identified afterwards does not by itself prove that the manager concerned breached its duty.

It also matters on what information the decision was based. The Communiqué requires investment decisions to be based on reliable reasoning, information, documents and analyses, and the research and reports underlying the decision to be kept for at least five years. These documents make it possible to examine not only the outcome seen in hindsight, but the assessment on the decision date. III-55.1 Art. 33/1(f) [5].

Within what limits is the portfolio custodian liable?

The portfolio custodian’s duty is not only to safekeep the assets. It has control duties with respect to the issuance and redemption of participation shares, the calculation of share value, the compliance of instructions with legislation, the transfer of transaction amounts, the use of income and the compliance of fund transactions with the established principles. This framework is established in Article 56 of the Law and set out in detail in Communiqué No. III-56.1. Law No. 6362, Art. 56/1 [1]; III-56.1 Art. 4–5 [6].

The Communiqué provides that, for investment limit breaches identified after the transaction, correction be requested and, if the non-compliance is not remedied, a notification be made without delay to the Capital Markets Board (SPK). It also regulates liability for loss arising from failure to fulfill this obligation. Accordingly, an allegation to be asserted against the custodian should explain which control should have been carried out on which date and how the failure to do so affected the loss. III-56.1 Art. 5/4(c) [6].

The custodian is liable for the loss it causes by failing to fulfill its own obligations; by contrast, Article 11/3 of the Communiqué excludes from its liability losses arising from the management of the portfolio or from changes in market prices. The same provision does not allow the liability under the legislation to be narrowed by contract. These provisions should be read together: the custodian does not guarantee the economic success of an investment; equally, an allegation that it breached its own supervisory obligation cannot be automatically disposed of by saying that the loss occurred in the market environment. III-56.1 Art. 11 [6].

For example, if it is alleged that a transaction exceeding the disclosed investment limit was not detected in time, merely showing the percentage by which the limit was exceeded falls short. The records accessible to the custodian, the time at which the control should have been carried out, whether correction was possible and the effect of the delay on the additional loss should be examined together. The fund’s subsequent loss in value does not by itself answer these questions. Likewise, the existence of a control letter does not explain whether the letter was sent in time or whether it was followed up.

The portfolio management company and the custodian are each obliged to demand the remedying of losses arising from the other’s breach of the law. Where sub-custody is used, Article 56/4 of the Law additionally provides for joint and several liability for the institutions providing custody services. This special provision should not be extended to mean that all banks through which the fund was sold, or all companies in the same group, are automatically liable for the same debt. Law No. 6362, Art. 56/3–4 [1].

In which cases can an action be brought against the bank from which the fund was purchased?

The presence of a fund in the bank’s app does not by itself show that the bank is the founder, portfolio manager or guarantor of that fund. The examination should be carried out on the basis of the service the bank undertook and the specific breach alleged against it. The institution names in the fund documents and in the account and service agreements should be compared. A bank, a brokerage firm and a portfolio management company providing services under the same brand should not be substituted for one another in this examination.

In guaranteed funds, the separately concluded guarantee agreement and the conditions under which the investor may benefit from the guarantee are also examined. The identity of the selling bank and that of the institution providing the guarantee should not be confused. The fact that the fund was purchased from a bank does not replace the special guarantee relationship in the documents. III-52.1 Art. 27 [4].

Sales and order transmission

In sales or in intermediation in purchases and sales, the execution of the order, care and loyalty, informing the client and risk disclosures are important. There are special rules on explaining transaction risks to retail clients and on proving that the disclosures were made. III-39.1 Art. 24–25 [7]. Allegations that a transaction was carried out with the wrong fund code, that the order was delayed or that product risks were conveyed incorrectly should be linked to these duties. In a case where the bank merely intermediated the sale, it cannot be assumed that it is responsible for all management decisions in the portfolio.

With regard to the appropriateness test, too, the exception specific to funds should not be overlooked. The SPK’s investment services guide does not make the appropriateness test mandatory for funds traded on TEFAS and for money market funds and short-term bond and bill funds, provided that the client is informed that there is no obligation to carry out the test; in this practice, it also does not require that the product be offered at the client’s own request. The guide does not generalize the exception to instruments other than those listed. Accordingly, the absence of a test does not by itself lead to a compensation outcome; it is examined whether the product falls within the scope and whether the required notification was made. III-39.1 Art. 33 [7]; Investment Services Guide, section on the appropriateness test [8].

Custody of the investor account and custody of the fund portfolio

The duty of the bank that keeps track of the investor’s participation shares in its account is separate from the duty of the institution that holds the assets in the fund’s portfolio in custody. A general custody authorization does not automatically confer authorization to hold fund portfolios in custody. III-37.1 Art. 59–63 [9]. For this reason, the same definition of duty cannot be used for an allegation that shares that should be in the account are missing and for an allegation that the fund portfolio was valued incorrectly. If the bank has undertaken both services, each breach is addressed within the scope of the relevant duty.

Investment recommendations and the advisory exception

Article 45/6 of Communiqué No. III-37.1 excludes from the scope of investment advice guiding comments given according to the client’s risk and return preferences concerning funds traded on TEFAS and BEFAS and money market and short-term debt instrument funds. Nevertheless, the rules on avoiding misleading statements, preparing comments with care, not promising returns and disclosing conflicts of interest apply. III-37.1 Art. 45/6, 48/2 and 50 [9].

In investment advice not falling within this exception, the authorized institution and the suitability test are examined separately. The Communiqué regulates this activity for licensed brokerage firms, investment and development banks and portfolio management companies. It cannot be assumed that every conversation at a bank branch is the bank’s authorized advisory service. III-37.1 Art. 40, 46 and 48 [9]. It should be determined who made the specific statement, on behalf of which institution and within the scope of which service. This way, instead of the loss of return itself, the effect of the alleged misdirection on the investment decision and on the loss can be discussed.

The details of qualified investor status, sales documents and test exceptions are addressed in the fifth article of the series, titled Investor Rights in Hedge Funds: Qualified Investors, Risk Disclosure and the Liability of the Selling Institution. Here, these distinctions matter for directing the compensation claim at the correct service provider and the correct breach.

Can several institutions be pursued for the same loss?

The involvement of more than one institution in a fund transaction does not mean that all of them are liable for the same debt. However, where the same loss was caused jointly, or where liability for the same loss arises on different legal grounds, joint and several liability may come into play. In such a claim, the ground of liability of each defendant is explained separately; the sharing of fault and risk among the institutions is assessed differently from the liability toward the injured party. TBK Art. 61–62 [2].

For example, it may be alleged that a transaction in breach of a management limit caused the fund a loss and that the control the custodian should have carried out in time could have prevented this loss. This allegation requires an examination of duty, breach and causation for both institutions. The purchase of the fund shares through another bank’s app, by contrast, does not automatically add the selling bank to those responsible for the same event. The special provisions on joint and several liability and the general conditions of liability should be applied together. Law No. 6362, Art. 56 [1].

The table is a framework for preliminary examination; it is not a definitive allocation of liability. The procedural conditions for naming several defendants in the same file are also examined. Increasing the number of defendants does not cure a claim directed against the wrong person; joinder of parties, subject-matter jurisdiction and the connection between the claims are determined separately. HMK Art. 57 [10].

If the prospectus or other public disclosure documents are misleading

If the allegation is based on false, misleading or incomplete information in a prospectus prepared under the legislation or in another public disclosure document, the special liability under Articles 10 and 32 of Law No. 6362 should also be examined. The status of the person who signed the document, of the legal entity on whose behalf it was signed and of the institution that prepared the report underlying the document matters. With respect to the prospectus, Article 10 separately regulates the liability of the issuer and the conditions for recourse to the other persons listed; not every bank selling the fund is in the same position as all of these persons. [1]

In this route, too, it should be shown in which document and version the false information appears, when the investment decision was made and what effect it had on the loss. The possibility of exculpation under Article 32/3 of the Law, the grounds for rejection under Article 32/5 and the special statute of limitations are assessed together. Moreover, the causation relief under Art. 32/4, which is tied to certain issuance, exchange-trading and timing conditions, cannot automatically be applied to all TEFAS purchases. Nor should an individual message from a sales employee and a public disclosure document published as required by legislation automatically be placed in the same legal category. Law No. 6362, Art. 10 and 32 [1].

How is the compensable loss calculated?

Market loss must be separated from breach of obligation

A loss in the value of the fund shares does not by itself show that the portfolio management company, the custodian or the bank intermediating the sale owes compensation. It should first be explained which obligation was breached, within whose sphere of responsibility this breach falls and how much of the loss it caused. Breach of contract and tort are different legal grounds; the claim directed against each defendant is assessed under its own conditions. The general bases of this approach are TBK Art. 49, 50, 112 and 114 [2].

The calculation should be based on a comparison of the investor’s actual financial position with the position that would have existed had the alleged breach not occurred. For example, in an allegation of a transaction contrary to the fund strategy, merely showing the difference between the initial investment and the final balance is not sufficient. Which market risks a portfolio consistent with the strategy would have borne in the same period, on which dates sales could have been made and the effect of costs on the outcome are also examined. Selecting in hindsight the fund that delivered the highest return and taking it as the benchmark does not prove the result the investor could actually have achieved.

Past performance, expected return or positive expressions used in promotional material do not automatically turn into a guarantee of capital and earnings. If a specific guarantee undertaking is asserted, its scope and validity are assessed separately. Similarly, signing a risk disclosure form does not mean that consent was given in advance to all breaches of obligation. The investor’s level of knowledge and conduct may matter in the specific case; but a lawful investment risk and a risk that was concealed or created without authority should not be treated as the same.

The fund’s loss and the investor’s personal loss should be tracked separately

Recovering a value that left the fund assets may require the fund account to be corrected. By contrast, giving the investor incorrect information or failing to properly execute the investor’s instruction may give rise to a claim of personal loss. The petition should show to whom the right to claim belongs, to which pool of assets the payment should be made and how the result reflected in the investor’s shares was calculated. One should not proceed on the assumption that each participation shareholder can claim the fund’s entire loss for their own account.

The same economic reduction cannot be remedied twice, both by being returned to the fund account and reflected in share value and by a direct payment to the investor. However, an uncertain collection that the fund may receive in the future should not be deducted as if it were a payment already made. Refunds made in the account, interim distributions, the current share value and expectations not yet realized should be shown separately. Nor does the existence of several liable parties multiply the amount of the loss; TBK Art. 61 and 62 [2] regulate joint liability for the same loss and the sharing among the liable parties themselves at different levels.

A hypothetical loss calculation

The example below is only intended to illustrate the distinction in the calculation. Assume that an investor invested 1,000,000 Turkish lira (TL), and that it has been determined on adequate data that, on the same calculation date, had the breach not occurred, the total economic value of the shares and of the cash flows relating to the same investment would have been 850,000 TL. A payment of 100,000 TL was received earlier; once the effect of this payment on the number of shares and any advance offset are recorded, let the verified net value of the investor’s remaining entitlement in the fund be 450,000 TL. Thus the total of the payment received and the remaining net entitlement is 550,000 TL. If the payment is in the nature of an advance and the number of shares does not change on screen, the gross share value and the advance should not be added together so that the same value is counted twice. Both situations are compared for the same investment and calculation date.

Under these assumptions, the entire apparent decrease of 450,000 TL from the initial investment is not recorded as loss arising from the breach. The 150,000 TL market loss that would have occurred even without the breach is separated in the calculation. However, if the method by which the 850,000 TL was determined, the reality of the current share value and the relationship of the distribution to the same item of loss are disputed, the result in the table also changes. Costs, taxes, interest and effects arising from different dates are examined separately. This example is not a valuation or compensation estimate for any particular fund. Proof of the loss and, where necessary, the judge’s determination of the amount are based on the data of the specific case. TBK Art. 50–52 [2].

With which records does the investor prove the claim?

The starting point of proof is to link each fact to a document or other appropriate evidence. HMK Art. 190 [10] sets the general burden of proof. In breach of contract, while the investor establishes the obligation, the breach, the loss and the causal link, the obligor may escape liability by proving absence of fault within the framework of TBK Art. 112 [2]. This distinction does not mean that the investor is relieved of the burden of proof for the entire file.

In preparing a claim, the following records are particularly important:

• Purchase and sale orders for fund participation shares, date and time information, prices, account movements and custody records.
• The prospectus, investor information form, fund rules, investment strategy and risk disclosures valid on the transaction date.
• Agreements with the bank or investment institution, appropriateness and suitability assessments, client classification and their updates.
• Correspondence showing the specific recommendation or instruction, reports sent and lawfully obtained recordings of conversations.
• Valuation reports, portfolio allocations, audit findings, and documents showing refunds and liquidation payments.

This list does not mean that all documents are equally important in every dispute. In an allegation of misinformation, the disclosures before the investment decision; in an allegation of late execution, the order times; and in a custody breach, the movements of the asset may be decisive. The final account balance alone does not prove all of these different allegations.

For documents not in the investor’s possession, production may be requested from the court by specifying the institution, period, transaction and which allegation the document will clarify. HMK Art. 219–220 [10] regulate the parties’ obligation to submit documents and the consequences of failing to comply with the court’s production order; for documents held by persons or institutions outside the action, Art. 221 additionally applies. Failure to submit a document does not automatically mean that the action is upheld; the court assesses the conditions in the law. Nor does the institution’s internal division of labor or its use of employees by itself remove liability; TBK Art. 116 [2] is additionally taken into account with regard to the acts of auxiliaries.

The expert report should present a verifiable calculation

Fund valuation, transaction timing and the calculation of an alternative portfolio may require technical expertise. Under HMK Art. 266 [11], a court-appointed expert is appointed on special or technical matters outside law. The court decides which defendant is legally liable. The report is expected to explain the data, dates, assumptions and alternative results used, and to separate ordinary market movement from the effect of the alleged breach. It should be shown clearly where periods without data were filled in by assumption. Difficulty in proving the exact amount of the loss and a complete failure to establish the existence of the loss are not the same situation; the judge’s assessment within the framework of TBK Art. 50–52 [2] should also preserve this distinction.

In determining the extent of compensation, the circumstances of the event and the gravity of the fault are taken into account. If the investor made a specific contribution to the occurrence or increase of the loss, a reduction under TBK Art. 52 may come into play. However, merely being regarded as an experienced investor is not sufficient to show that such a contribution occurred.

How did a court decision assess the conduct of the bank and the investor?

The decision of the 14th Civil Chamber of the Istanbul Regional Court of Appeal (İstanbul Bölge Adliye Mahkemesi 14. Hukuk Dairesi) dated May 11, 2023, E.2020/1284, K.2023/818, concerns a claim for loss arising from foreign investment funds. The Chamber assessed both that the bank had not exercised the required care in providing information affecting the client’s purchase and sale decisions and the investor’s signed instructions spanning years and conduct. The appeals (istinaf) against the judgment of partial acceptance, in which each party was held 50 percent at fault, were dismissed on the merits. [20]

The value of the decision for this article lies in the joint examination of the scope of the bank’s service, the disclosures, the transaction records and the investor’s conduct. The 50 percent ratio is not a compensation benchmark for all fund files. The dispute concerns foreign fund transactions in the 2007–2012 period; it cannot be presented as the same event as the 2026 liquidation transactions or as a decision concerning the current fund regime as a whole. The review here is based on a publicly available full-text reproduction of the decision; the source is not the official court decision portal. [20]

How are the court with subject-matter jurisdiction and mediation determined?

The fact that the defendant is a bank does not by itself take all disputes to the same court. In examining subject-matter jurisdiction, the purpose for which the investor acted, the nature of the specific transaction, the content of the service relationship and the provision on which the claim is based are considered together. TTK Art. 4 and 5 [12] regulate commercial cases and the jurisdiction of the court; TKHK Art. 3, 73 and 83 [13] regulate the framework to be applied to consumer transactions.

For this reason, the consumer court should not be declared in advance to have jurisdiction for every natural person fund investor, nor the commercial court of first instance for every action involving a financial institution. It should also be explained whether the claim arises from a personal service relationship or from a breach directed at the fund assets. Naming more than one defendant does not remove the need to examine these distinctions.

Subject-matter jurisdiction and territorial jurisdiction are separate matters. Besides the defendant’s domicile, the place of performance of the contract, the place where the branch transaction took place and the special jurisdiction rules on tort may come into play. If there is a consumer transaction, the possibility of filing at the consumer’s domicile is also assessed. A jurisdiction clause in the contract should not automatically be regarded as valid, especially for an investor who is not a merchant; HMK Art. 6, 10, 14, 16–18 [10] should be applied to the specific relationship.

If the action is commercial in nature, TTK Art. 5/A [12] provides for mediation as a condition precedent to litigation for claims for payment of money or compensation; if it is of a nature to be heard by the consumer court, TKHK Art. 73/A [13] does so, subject to its exceptions. Disputes within the jurisdiction of the consumer arbitration committee and objections to the committee’s decision are among the exceptions to this second provision. The monetary threshold valid on the application date should also be checked. The mediation application should sufficiently identify the persons against whom the action will be brought and the dispute; the final report of non-agreement should be attached to the statement of claim. Failing to apply and forgetting to attach the report that was drawn up are subject to different consequences under Law No. 6325, Art. 18/A [14].

How is an action brought if the amount of the loss has not yet been finalized?

As of October 18, 2026, the amendment of July 31, 2026 should be taken as the basis when choosing the type of action. Law No. 7589, Art. 19 [3] repealed HMK Art. 107, which regulated the action for an unspecified claim (belirsiz alacak davası). For a new action, the formula “unspecified claim to be determined by expert calculation” cannot be used on the basis of the former provision. The legislative record of the Grand National Assembly of Türkiye (TBMM) [15] confirms the adoption of the provision and its publication in the Official Gazette.

If the claim is divisible, the possibility of a partial action is assessed. HMK Art. 109/4, added by Art. 20 of the same Law, allows the claim to be increased once in the same action, until the end of the investigation phase (tahkikat), without being subject to the prohibition on expanding the claim. With respect to the portion increased in this way, too, the statute of limitations is deemed interrupted from the date of the action. This facility does not make usable again a claim that became time-barred before the action was brought; nor does it remove the need to explain the relationship in dispute, the amount initially claimed and the items of loss. The procedure for the increase, court fees and costs, and the stage at which the investigation phase ended should be monitored.

The transitional rule has also been preserved: under Law No. 7589, Transitional Art. 1/10 [3], former Art. 107 continues to apply to actions brought before the date of repeal. Accordingly, when assessing an existing file, no choice should be made between the new and old regimes before the date of the action is established. July 16, the date of adoption of the Law, and July 31, the date of entry into force for these provisions, should also not be confused.

How are evidence and the possibility of collection preserved while the action is pending?

If there is a possibility that a record will be lost or that its future use will become seriously more difficult, preservation of evidence under HMK Art. 400 [10] may be considered. The request should explain the fact to be established and why waiting would be detrimental. Preservation of evidence is not a decision awarding compensation or securing collection.

To protect the future collection of a monetary claim, a precautionary attachment may be requested within the framework of Articles 257–259 of the Enforcement and Bankruptcy Law (İİK) [16]. The rule is a monetary debt that is not secured by a pledge and has fallen due; for a claim not yet due, the special grounds in the law are required. Sufficient evidence should be submitted to the court on the claim and, where necessary, on the ground for attachment, and the security requirement should be assessed. The mere filing of an action does not automatically freeze the debtor’s assets.

An interim injunction under HMK Art. 389 [10], by contrast, provides protection with respect to the right or property in dispute. The conditions for precautionary attachment should not be circumvented through a request for an injunction covering all assets merely to secure a monetary claim. The time limits required for enforcing the protective decision and linking it to the main action are monitored separately; the special effect of mediation on these time limits is also assessed under Law No. 6325, Art. 18/A/16 [14].

From what date does the statute of limitations run?

The time-limit calculation should be made separately for each defendant, breach and claim. It cannot be said that all contract-based claims are necessarily subject to a ten-year period. Although the general period is ten years, there is a five-year rule for claims arising from mandate and commission agreements. The legal nature of the specific service relationship and the special provisions should be determined. Nor is the fund’s liquidation date automatically taken as the starting point; the date on which the claim fell due and, where necessary, the date on which notice could be given are important. TBK Art. 146, 147 and 149 [2].

In a tort claim, two years from learning of the loss and of the person liable to compensate it, and in any event ten years from the commission of the act, are taken as the basis. If a longer criminal statute of limitations applies to the act, TBK Art. 72 [2] may additionally apply. However, the existence of a criminal file does not automatically create the same longer period for all claims against all institutions; the connection between the act alleged, the loss and the ground of liability should be established.

For the special claim arising from public disclosure documents, there is additionally a short period: Law No. 6362, Art. 32/6 provides for a six-month statute of limitations from the date on which the loss under Art. 32/4 occurred. Before the scope of application of this special provision to the specific fund transaction and its starting point are determined, one should not rely on the general two-, five- or ten-year periods. If another contractual breach is asserted in the same event, its conditions and period are also assessed on its own legal basis. [1]

A complaint to the prosecutor’s office or to the SPK does not automatically interrupt the statute of limitations of a private-law claim. The grounds regulated in TBK Art. 154 [2], such as acknowledgment of the debt, an action or enforcement proceedings, are required separately. It cannot be automatically assumed that a distribution made by the fund is an acknowledgment of debt by the bank that is the addressee of a separate compensation claim or by another liable party. In mediation as a condition precedent to litigation, by contrast, the statute of limitations is suspended and the time limit for bringing an action (hak düşürücü süre) does not run from the application to the mediation office until the final report; this is the special consequence of Law No. 6325, Art. 18/A/15 [14].

Does a criminal file stay the compensation action?

A civil action may be brought while a criminal investigation is ongoing. If the judgment depends on the outcome of another file, the court may, under HMK Art. 165 [10], assess whether to stay the proceedings pending a preliminary question; there is no mandatory rule requiring a stay for every criminal investigation. TBK Art. 74 [2] provides that, in assessing fault and capacity to discern, the civil judge is not bound by criminal law or by an acquittal, and further that the criminal judge’s assessment of fault and loss does not bind the civil judge. This provision should not be read as meaning that all findings in the criminal file are unimportant. Bringing the relevant records into the civil file and staying the proceedings are different decisions.

How are interim payments, interest and excess damage handled?

For each payment, the date, payer, recipient and the claim to which the payment relates should be recorded. Collections relating to the same item of loss are taken into account in the calculation. By determining which part of the debt the payment discharged, interest should not be calculated again in the subsequent period on the amount discharged. The type and starting point of interest are determined according to the legal ground of the claim and the conditions of default. The investment date alone is not a common starting point for interest for all defendants.

A claim for damage exceeding default interest (aşkın zarar) requires separate reasoning and calculation under TBK Art. 122 [2]. When loss of principal, late-payment interest and the additional damage caused by the delay are added together, the same economic loss must not be recorded again. This way the action rests not on a general expectation of return, but on a calculation linked to the ground of liability and updated for payments.

How do the liquidation decision and new regulatory work affect the action?

Liquidation concerns converting the fund assets into cash by the established procedure and distributing them to the right holders. The compensation action, by contrast, aims to remedy a loss asserted on a specific ground of legal liability. The calculations of these two routes are linked; however, the liquidation decision does not give the investor a finalized compensation claim against every institution. Nor can it be accepted in advance for all cases that it is necessary to wait for the liquidation to be completed. The conditions of the existing claim, the loss calculation, the type of action and the time limits should be assessed together. III-52.1 Art. 28 [4]; TBK Art. 49, 112 and 149 [2].

Is the bank conducting the liquidation responsible for all past transactions?

The SPK’s decision No. 57/1708 dated September 17, 2026 provides for the appointment of the relevant banks as portfolio custodians for certain funds and their authorization to conduct the liquidation. The decision sets out the banks’ authority, with respect to the duties assigned to them, to carry out the transactions necessary for liquidation, and their duties and responsibilities arising from custodianship. This appointment cannot be read as meaning that the new bank is responsible for every past management decision. SPK Bulletin No. 2026/61, A/1-A(1) [17].

If the fund founder is actually changed, by contrast, Article 29/5 of Communiqué No. III-52.1 applies: the former and new founders are jointly and severally liable for obligations arising from the legislation prior to the change of founder. A change of founder, a change of custodian and an authorization for liquidation should not be treated as the same transaction. In an ordinary change of custodian, III-56.1 Art. 10 separately provides for the continuation of the former custodian’s responsibility until the new custodian agreement enters into force; in a special SPK appointment, the scope of the decision and the transitional provisions are taken as the basis. [6] When determining the institution against which the action will be directed, the date of the breach, the institution in charge on that date and the legal nature of the subsequent change should be established. III-52.1 Art. 29/5 [4].

Status of the special bill as of October 18, 2026

The Bill on Certain Investment Funds Whose Liquidation Has Been Decided appears in the TBMM records under docket number 2/3939. The TBMM’s news item dated October 14, 2026 states that the bill was adopted by the Plan and Budget Committee. In the check dated October 18, 2026, the latest status on the bill information page appears as “In Committee.” Since its entry into force has not been confirmed, the bill has not been applied as current law in this review. TBMM bill record [18]; TBMM committee adoption news item [19].

The model envisaged in the bill for recovering fund losses and collecting from those responsible should not be substituted for the private-law conditions of action currently in force. If the new regulation enters into force, the scope, transitional, distribution and offset provisions should be re-examined on the basis of the text as adopted and published. A committee adoption news item or the text of the bill as submitted is not by itself a law in force. For this reason, the calculation of current time limits should not be left to a regulation expected to be enacted in the future.

Which questions should be answered in preparing an action?

The aim of preparation is to turn a general account of grievance into facts that can be examined. For each investment, the fund’s full title and code, the number of shares, the purchase and sale dates, the payments and the names of the institutions involved should be matched on a single record. A file answering the following questions can then be prepared:

• Which transaction is in dispute? The date, amount, instruction given or statement made should be specified.
• Who had undertaken which duty? The founder, manager, custodian, selling institution and any adviser should not be grouped under the same name.
• How did the breach turn into a loss? The effect of the transaction on share value or on the investor’s own account should be shown.
• Who holds which document? The records held by the investor should be separated from the records that must be requested through the court.
• What are the claim and the time limit? The legal ground, initial amount, interest, mediation and the statute of limitations calculation should be prepared together.

This work is important for specifying the evidence and obtaining the relevant documents. It should not be assumed that the same document proves all allegations against all defendants. HMK Art. 190, 194 and 219–220 [10].

When signing a payment or settlement document

Receiving an interim payment and waiving all compensation rights are not the same legal transaction. Nevertheless, it should be examined whether the document presented merely evidences the collection, whether it contains a release (ibra) extinguishing the debt, which claims it covers and whether it contains a declaration of waiver of an action. The extinction of a debt by release and the consequences of a waiver in proceedings are subject to different provisions. For the procedural consequence of waiver of an action, the form of declaration in HMK Art. 309 and the requirement that it be unconditional are also required; the private-law effects of a document signed out of court are assessed separately according to its content. TBK Art. 132 [2]; HMK Art. 307, 309 and 311 [10].

The text should make clear the payment amount, the fund and period concerned, the item of claim to which the payment was applied, and the status of interest and other claims. Loss not yet calculated, amounts to be claimed from another liable party or future liquidation distributions should not be left within general wording without a clear assessment. This way the payment record and the scope of the continuing claim can be tracked in the same file.

Related articles: Interim Injunction and Precautionary Attachment: How to Protect Your Rights Without Waiting for the Outcome of the Case; Statute of Limitations and Preclusive Periods: How Is the Time Limit for Bringing an Action Determined?; How Are Inherited Shares and Investment Funds Taken Over? MKK and Brokerage Firm Procedures; Investor Rights in Hedge Funds: Qualified Investors, Risk Disclosure and the Liability of the Selling Institution; Default Interest and Excessive Loss Claims for Unexecuted Fund Redemption Instructions; Criminal Investigations, Seizure and Remedying Investor Losses in Investment Funds Under Liquidation; SPK Fund Liquidation: Investor Rights, Payment Process and Legal Routes of Recourse.

Conclusion

An effective compensation review in investment fund losses begins with determining from which breach of duty the loss arose and against which institution this breach can be asserted. The management and supervisory duties of the portfolio management company, the control obligations of the custodian and the service undertaken by the bank are not of the same scope. Liability cannot be established automatically on the basis of the institution’s name or the fund’s poor performance. Law No. 6362, Art. 52–56 [1].

When preparing the claim, the common fund loss and personal loss, the ordinary market loss and the effect of the breach, and payments made and expectations of collection should be separated. Subject-matter jurisdiction, mediation, interim protection and the statute of limitations also accompany this assessment. In actions to be newly brought, the procedural amendment of July 31, 2026 should be taken into account; in older files, the transitional provision. While criminal and liquidation proceedings are followed, the conditions and time limits of the private-law claim should be separately protected. Law No. 7589, Art. 19–20 and Transitional Art. 1/10 [3]; TBK Art. 72, 146–149 and 154 [2].

Frequently Asked Questions

Is a fall in the fund’s value sufficient to obtain compensation?

No. The breach of duty, the loss and the causation on which the claim is based should be explained. A loss in value caused by market conditions and a loss caused by a breach in the management, custody or sales service are not the same. If the institution has undertaken a specific guarantee, it is examined separately. TBK Art. 49, 50 and 112 [2].

I bought the fund from a bank; must I bring the action against the bank?

The choice of defendant depends on the bank’s specific role. The bank may have intermediated the sale, held the investor account in custody or undertaken another service. If the fund’s founder and portfolio custodian are different institutions, their duties are examined separately. Being within the same brand or corporate group does not automatically merge liabilities. Law No. 6362, Art. 52–56 [1]; III-37.1 Art. 59–63 [9].

Is the portfolio custodian obliged to pay the fund’s entire loss?

The loss caused by the custodian’s failure to fulfill its own obligation is examined. There is no general guarantee liability for losses arising from portfolio management or from changes in market prices. On the other hand, an allegation that a breached control or notification duty caused additional loss is assessed separately. III-56.1 Art. 5 and 11 [6].

Is failing to carry out an appropriateness or suitability test a breach in every case?

No. The nature of the service and the product scope matter. For some funds there is an exception from the appropriateness test; for guiding comments on certain funds there is a provision excluding them from the scope of investment advice. The exception does not mean that misleading statements may be made or that applicable disclosure obligations cease to exist. III-37.1 Art. 45/6 [9]; Investment Services Guide [8].

If the amount of the loss is not known, can an action for an unspecified claim be brought?

From July 31, 2026, former HMK Art. 107 should not be relied upon for new actions. The provision on partial actions and increase of the claim in HMK Art. 109/4 is assessed with its conditions. In files brought before the date of repeal, by contrast, former Art. 107 continues to apply under the transitional provision. Law No. 7589, Art. 19–20, Transitional Art. 1/10 and Art. 26 [3].

Does every fund investor file with the consumer court?

No. The investor’s purpose in the transaction, the nature of the service and of the claim, and the relevant special provisions should be examined. The distinction between a commercial case and a consumer transaction affects the court with subject-matter jurisdiction and the mediation regime. Being a natural person, or the defendant being a bank, does not replace this examination. TTK Art. 4–5 [12]; TKHK Art. 3, 73 and 83 [13].

Does a complaint to the prosecutor interrupt the statute of limitations for compensation?

A complaint alone does not interrupt the statute of limitations of a private-law claim. The grounds for interruption and, if applicable, the conditions for applying a longer criminal statute of limitations are assessed separately. The effect on the time limit of applying for mediation as a condition precedent to litigation, by contrast, is separately regulated in the law. TBK Art. 72 and 154 [2]; Law No. 6325, Art. 18/A/15 [14].

Can compensation be claimed after receiving an interim payment in liquidation?

The scope of the payment and any agreement signed are examined. An interim payment is taken into account in the compensation calculation with respect to the same economic loss; the conclusion that all losses and claims have ended does not follow from the mere receipt of a payment. The legal effect of a text containing a release or a waiver of an action should be assessed separately. TBK Art. 50–52 and 132 [2]; HMK Art. 307, 309 and 311 [10].

Sources and legal bases

Source check date: October 18, 2026. The adopted text of the legislation, the published text of amendments, institutional compilations and the bill record have been distinguished by source type. The provisions specified below have been assessed; it is not claimed that all articles of the compilation files are completely up to date as of 2026.

1. Capital Markets Law No. 6362 (6362 sayılı Sermaye Piyasası Kanunu) — text in the SPK legislation system.
2. Law No. 6098, Turkish Code of Obligations (6098 sayılı Türk Borçlar Kanunu) — law text as adopted by the TBMM. Text of the law as adopted; the relevant amendments have been assessed separately.
3. Law No. 7589 Amending Certain Laws for the Effective and Efficient Functioning of the Judiciary (Yargının Etkin ve Verimli İşlemesine Yönelik Bazı Kanunlarda Değişiklik Yapılmasına Dair Kanun) — full text as adopted by the TBMM.
4. Communiqué on Principles Regarding Investment Funds (Yatırım Fonlarına İlişkin Esaslar Tebliği) (III-52.1).
5. Communiqué on Principles Regarding Portfolio Management Companies and Their Activities (Portföy Yönetim Şirketleri ve Bu Şirketlerin Faaliyetlerine İlişkin Esaslar Tebliği) (III-55.1).
6. Communiqué on Principles Regarding Portfolio Custody Services and the Institutions Providing Them (Portföy Saklama Hizmetine ve Bu Hizmette Bulunacak Kuruluşlara İlişkin Esaslar Tebliği) (III-56.1).
7. Communiqué on Principles of Establishment and Activities of Investment Firms (Yatırım Kuruluşlarının Kuruluş ve Faaliyet Esasları Hakkında Tebliğ) (III-39.1).
8. Guide on Investment Services and Activities and Investment Firms (Yatırım Hizmet ve Faaliyetleri ile Yatırım Kuruluşlarına İlişkin Rehber) — last update i-SPK.37.9 (Principle Decision No. 37/1118 dated June 17, 2026).
9. Communiqué on Principles Regarding Investment Services and Activities and Ancillary Services (Yatırım Hizmetleri ve Faaliyetleri ile Yan Hizmetlere İlişkin Esaslar Hakkında Tebliğ) (III-37.1).
10. Law No. 6100, Code of Civil Procedure (6100 sayılı Hukuk Muhakemeleri Kanunu) — law text as adopted by the TBMM; later amendments distinguished separately. Text of the law as adopted; for Art. 107 and 109, Law No. 7589 and the transitional provision should be read together.
11. Expert witness provisions of the Code of Civil Procedure — Ministry of Justice, Department of Expert Witnesses (Adalet Bakanlığı Bilirkişilik Daire Başkanlığı).
12. Turkish Commercial Code No. 6102 (6102 sayılı Türk Ticaret Kanunu) — official PDF of the Ministry of Trade (Ticaret Bakanlığı Aydın Ticaret İl Müdürlüğü).
13. Law No. 6502 on Consumer Protection (6502 sayılı Tüketicinin Korunması Hakkında Kanun) — official compilation of the Ministry of Trade, January 2021. January 2021 compilation; not used for the current monetary threshold.
14. Law No. 6325 on Mediation in Civil Disputes (6325 sayılı Hukuk Uyuşmazlıklarında Arabuluculuk Kanunu) — Ministry of Justice, Department of Mediation (Adalet Bakanlığı Arabuluculuk Daire Başkanlığı). 2023 compilation; only the Art. 18/A provisions explained here have been used.
15. Law No. 7589 — TBMM Law Information (adoption, approval and publication in the Official Gazette).
16. Articles 257–259 of the Enforcement and Bankruptcy Law No. 2004 (2004 sayılı İcra ve İflas Kanunu) — column of the Law in force in the official comparison table of the Ministry of Justice. Only the column for Art. 257–259 of Law No. 2004 in force, on printed pages 646–649, has been used; the draft provisions in the opposite column have not been presented as current law.
17. SPK Bulletin No. 2026/61 — September 17, 2026, decision No. 57/1708; appointment for liquidation and custody.
18. TBMM — Bill on Certain Investment Funds Whose Liquidation Has Been Decided (Tasfiyesine Karar Verilen Bazı Yatırım Fonları Hakkında Kanun Teklifi), 2/3939; bill information record.
19. TBMM — The Bill Containing Provisions on Certain Investment Funds Whose Liquidation Has Been Decided Was Adopted in Committee, October 14, 2026.
20. 14th Civil Chamber of the Istanbul Regional Court of Appeal (İstanbul Bölge Adliye Mahkemesi 14. Hukuk Dairesi), May 11, 2023, E.2020/1284, K.2023/818 — publicly available full-text reproduction of the decision. The facts, examination and judgment sections of the decision have been examined together; the link does not belong to the official judicial portal.