Turkish Constitutional Court ["TCC"], in its decision no. 2023/36 E., 2023/142 K. published in the Official Gazette dated 13 October 2023, annulled Article 46, paragraph 1, subparagraph (b) of the Turkish Code of Administrative Procedure No. 2577 ["TCAP"], which regulates the appeal in administrative judiciary, by finding it in violation of the Turkish Constitution. The decision will enter into force on 13 July 2024, nine months after its publication in the Official Gazette.
The provision subject to annulment, Article 46, paragraph 1, subparagraph (b) of the TCAP, provided for the appeal procedure in respect of "tax actions, full remedy actions and actions filed against administrative acts, the subject matter of which exceeds one hundred thousand Turkish Liras".
Pursuant to the Additional Article 1 of the TCAP, the monetary limits stipulated in TCAP were to be applied by increasing the revaluation rate determined and announced by the Ministry of Treasury and Finance for that year, effective from the beginning of each calendar year. In this context, the monetary limit stipulated in the law for appellate review was 581.000,00- (five hundred and eighty-one thousand) Turkish lira for 2023.
Grounds Introduced in the Annulment Request
In the request for annulment introduced by way of contention of unconstitutionality, it is stated, in terms of the expression "the subject matter of which exceeds one hundred thousand Turkish Liras" in the subparagraph (b), that the amount taken as the basis for the appeal may change every year depending on the revaluation rate, which leads to an inequality between the persons whose cases are concluded earlier and those whose cases are concluded later,. In a case where two lawsuits were filed on the same date with the same subject matter value; one of them could be appealable while the other cannot, since the subject matter value of a lawsuit may stay below the monetary limit due to the late establishment of regional court’s decision. Thus, it has been argued that this situation constitutes a violation of principles such as equality, the right of access to the court, and the right to request a review of the decision.
Grounds for Annulment by the TCC
The TCC, in its reasoned decision for the annulment, concluded that the relevant paragraph violated two fundamental principles.
Firstly, the relevant subparagraph did not specify whether the monetary limit for appeal shall be based on the date of filing of the lawsuit or the date of the decision of the appeal authority. The TCC stated that since the monetary limits change every year in terms of appealability, the date to be taken as the basis for the relevant application should be regulated in a clear and foreseeable manner in the law, and it was found that the relevant subparagraph did not meet the requirement of legality principle since it was not explicit, was unambiguous and unclear.
Secondly, no exceptions were envisaged in the subparagraph for the cases where the regional court revokes the decision of the court of first instance and renders a new decision. The TCC concluded that the finalisation of disputes, which cannot be considered insignificant due to the monetary value of the case, with the decision of the Regional Administrative Court without any further review, violated the right to legal remedies under Article 36 of the Turkish Constitution, and in this context, the "right to request that the decision is reviewed by another judicial authority".
As a ground, it is stated that this limitation imposed an excessive burden on individuals and had a significant adverse impact on the balance of interests between the claimants vis-à-vis the administration to the detriment of the claimants, and that this situation therefore constituted a disproportionate limitation on the right to request that the decision is reviewed.
Despite the fact that the TCC has annulled the provision on the monetary limit in the administrative judiciary, this does not lead to the conclusion that the monetary limit for appeal is completely abolished. Indeed, as also recognised by the TCC, the existence of monetary limits on legal remedies does not by itself constitute a violation of the right to legal remedies as set out in Article 36 of the Turkish Constitution. The TCC annulled the relevant provision only because it did not provide protection only in terms of the principle of legal clarity and the right to request a review of the decision in specific circumstances. Accordingly, in the upcoming period until the entry into force of the annulment decision, a new regulation regarding the monetary limits may be introduced by eliminating the uncertainties mentioned in the reasoned decision for annulment.
By Selin Nacar Ozturk, Associate, Guleryuz & Partners