WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO  WT/TPR/M/125/Add.2 
8 March 2004 
 (04-1014) 
Trade Policy Review Body 
17 and 19 December 2003 Original:  English/ 
                 anglais/                  inglés 
  
 
TRADE POLICY REVIEW 
Turkey  
Minutes of Meeting
 
Addendum  
Chairperson:  H.E. Ms Mary Whelan (Ireland) 
 This document contains the advance writte n questions, and replies provided by Turkey.1 
__________________________________________________________________________________ 
 
Organe d'examen des politiques commerciales 
17 et 19 décembre 2003  
EXAMEN DES POLITIQUES COMMERCIALES 
Turquie 
Compte-rendu de la réunion
 
Addendum  
Présidente:  S.E.  Mme Mary Whelan (Irlande) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par la Turquie .1 
__________________________________________________________________________________  Órgano de Examen de las Políticas Comerciales 17 y 19 de diciembre de 2003  
EXAMEN DE LAS POLÍTICAS COMERCIALES 
Turquía 
Acta de la reunión
 
Addendum  
Presidente:  Excma. Sra. Mary Whelan (Irlanda) 
 
 En el presente documento figuran las pre guntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por Turquía.1 
 
                                                      
1 In English only./En anglais seulement./En inglés solamente.  WT/TPR/M/125/Add.2 
 Page 3 
 
 
ADVANCE WRITTEN QUESTIONS BY MEMBERS AND 
REPLIES PROVIDED BY TURKEY 
 
 
III. TRADE POLICIES AND PRACTICES BY MEASURES 
CUSTOMS PROCEDURES  
Question (Indonesia):  
 
 With regards to the custom procedures, the pa ragraph 6 of the Secretariat’s Report notes that 
Turkey has enacted new Customs Law No. 4458 on 5 February 2000 replaced Custom Law No. 1615. 
Indonesia would be interested to know if Turkey has notified this new custom law to the WTO and 
where this information available for public.  
Answer:
 
  The English version of the Turkish Customs La w No: 4458 is at the official website of the 
Undersecretariat of Customs. The we b address is: http://www.gumruk.gov.tr/ 
Turkish_Customs_English/toctum.htm. Turkey has no t notified the law to the WTO at the moment.  
 
Question (Indonesia):
 
  Paragraph 9 of Secretariat’s report notes that the customs authority may grant permission to 
simplify formalities and procedures (Simplified Pro cedures Authorization), including by waiving the 
requirement to present some of the documentation to  customs. Indonesia would appreciate if Turkey 
could explain how and under what condition to obtai n the simplification of formalities and procedures 
of customs. 
 
Answer:
 
 
 Article 71 of the Turkish Customs Law No: 445 8 draws the general framework for Simplified 
Declaration Procedure which is comprehensiv ely covered under Articles 136-163 of Customs Law 
Implementing Provisions. The law can be reached at http://www.gumruk.gov.tr/ 
Turkish_Customs_English/toctum.htm.  
 
There are three methods by which customs au thorities can grant simplified procedure to 
declarant in order to facilitate the customs formalities.  
 The first method (i.e. incomplete declaration) allows the customs authorities to accept, in a 
duly justified case, a declaration that does not c ontain all the items required, or that is not 
accompanied by all documents necessary for the customs procedure in question.  
  The second method allows the declarant to lodge a simplified declaration when goods are 
presented to the customs. Such simplified declaration may be in the form of an administrative or a 
commercial document that contains at least the items necessary for identification of the goods. The 
document shall be accompanied by the request fo r the goods to be placed under the related customs 
procedure in question.  
 Under the third method, customs authorities ma y allow the declarant to use local customs 
procedure which enables the entry of goods for the cu stoms procedure in question to be carried out at WT/TPR/M/125/Add.2 
Page 4  
 
the premises of the real/legal entities concerned or at other places designated or approved by the 
customs authorities.    The general conditions are indicated in Ar ticle 136 of the Implementing Provisions of 
Customs Law no: 4458 (IPCL). According to this Article, any person who regularly lodges Customs 
declaration and bears the necessary conditions w ould be given the right for using simplified 
procedures.   However,   
a) any person who has been subject to punis hment due to infringement of the customs 
provisions that gives rise to the loss of tax revenue more than at least 5 times and equals to more than 2% of the number of customs declar ations lodged in the previous calendar year, 
 
b) any person who has been subject to punishme nt for inconsistency due to their conduct 
pertaining to more than 5% of the numbe r of Customs declarations lodged and the 
infringement of the Customs legislation at least 10 times within the previous calendar year, 
 
c) any person acting on behalf of the other  
  shall not be given the right for using simplified procedures. 
 
 In addition to the above stated general cond itions, the applicant has to meet the specific 
conditions mentioned for each customs procedure in Articles 137, 148 and 156 of the Implementing 
Provisions and the conditions specified for each type of simplified procedure to be granted the status 
of “Approved Exporter” to use simplified procedures.  
 
 The special conditions indicated in Articles 137, 148 and 156 of the IPCL are as follows; 
  Article 137 is on “The special conditions requi red for entrance into free circulation under 
simplified procedure”. According to this Article,  a declarant who declares goods for free circulation 
under simplified procedure has to bear at least one  of the below mentioned conditions apart from the 
general conditions stated in Article 136.  
 
a) The declarant, in order to utilize simplified procedure for free circulation, has to 
import goods that amount to a value of at leas t 5 million CIF/USA dollars accompanied by at 
least 100 Customs declaration in the previous calendar year. 
 
b) The declarant in order to u tilize simplified procedure for free circulation has imported 
goods that amount to a value of at least 10 million CIF/USA dollars in the previous calendar year. 
 
Article 148 comprises exactly the same provisions with Article 137, however this time for the 
declarants using simplified procedure for export. Article 156 again indicates the same provisions as 
Article 137 and 148, however the regime  it relates to is Customs warehouse. 
 
Question (Brazil):
 
  Under chapter III, item 15, of the WT/TPR/S/125 document, Turkey informs that it maintains 
both preferential and non-preferential rules of origin. In the case that certificat e of origin is required 
from importing countries, could Turkey inform the authorities that issue the certificate of origin? 
  WT/TPR/M/125/Add.2 
 Page 5 
 
 
Answer:  
 
 In case that the certificate of origin is required from importing countries, the practice is that Turkey does not extend information to the relevant authorities that issue the certificate of origin.  
 
I
MPORT PROHIBITIONS , QUOTAS AND LICENSING  
Questions (Brazil):  
 
 1. Is there any kind of register required fro m Turkey importers to the prior import licensing? 
Which would be the required procedures? 
 
 2. What is the value of licensing fees to cover administrative expenses on the  processing of documents? 
 
Answer:
 
 
 Import licenses are required for a limited group of products including, inter alia , 
telecommunication equipment, some machinery, some  motor vehicles, transmission apparatus, some 
chemicals, and a number of items related to civil ai rcraft in order to assure public security and safety 
and to protect the environment and cons umer rights. There is no licensing fees. 
  Turkey’s application on licensing is in conformity with the provisions of the WTO Agreement on Import Licensing. The system is automatic in the sense that once an applicant meets the pre-
established conditions the license is issued automatically.   
 
Question (Brazil):
 
  Under Chapter III, item 39, of the WT/TPR/S /125 document, Turkey informs that import 
quotas have been applied on certain textile and cl othing products as a requirement for harmonizing its 
import policy with that of the EU. Considering that EU does not apply any more quotas on Brazilian 
exports, why Brazil is listed on ta ble III.8 as subject to quotas? 
 
Answer:
 
 
 The quantitative restrictions are applied by Turk ey on certain textile and clothing products as 
a requirement for harmonizing Turkey’s trade polic y with that of the EC. In this regard, the 
preferential schemes provided by the EC as a result of recent market access negotiations with certain countries would also be reflected in Turkey’s rele vant import arrangements. However, simultaneous 
application of these preferential treatments cannot be  offered to the beneficiary countries, since the 
adoption procedures require some time for the completion of necessary adjustments.  C
ONTINGENCY TRADE REMEDIES  
Question (Brazil):  
 
In WT/TPR/S/125, Chapter III, paragraph 44, it is mentioned that the new legislative 
framework introduces provisions on, "inter alia", an ti-circumvention.  Could Turkey inform if since 
the implementation of this new legislative frame work it has initiated any "anti-circumvention" 
procedure? If so, could Turkey indicate the number of this procedures that it has initiated, as well as 
their results?  WT/TPR/M/125/Add.2 
Page 6  
 
Answer:
 
 
 The domestic legislation of Turkey on the implementation of WTO Anti-Dumping Agreement 
comprises of the Law, Decree and Regulation, namely: 
 
• Law No. 3577 on the Prevention of Unfair Competition in Imports, 
• Decree on the Prevention of Unfair Competition in Imports, 
• Regulation on the Prevention of Unfair Competition in Imports. 
 
In accordance with Article 11 of the Decree on the Prevention of Unfair Competition in 
Imports, an anti-circumvention investigation can be initiated and carried out in order to prevent the 
circumvention of existing anti-dumping duties. However, Turkey has not resorted to any anti-circumvention procedure until present. 
 
Question (Brazil):
 
  In WT/TPR/S/125, Chapter III, paragraph 47, it is said that "(...) Provisional measures shall 
be imposed no earlier than 60 days from the initiation of an investigation, and their duration shall be 
limited to four months. However, according to Ar ticle 12 of the Law, provisional measures may be 
extended to a period not exceeding six months upon re quest by exporters with a significant share of 
the exports of the product to Turkey."  In the light  of Art. 7.4 of the Anti-Dumping Agreement which 
establishes that "when authorities, in the course of  investigation, examine whether a duty lower than 
the margin of dumping would be sufficient to re move injury, these periods (of appliance of the 
provisional measures) may be six and nine months,  respectively", could Turkey clarify if its 
legislation does not provide the possibility of applian ce of a duty lower than the margin of dumping, if 
it is sufficient to remove injury? 
 
Answer:
 
 
 Article 12 of the Law No. 3577 on the Prevention of Unfair Competition in Imports stipulates that, “in the course of a dumping investigation, to  examine whether a duty lower than the margin of 
dumping would be sufficient to remove the injury , these periods [that is, 4 and 6 months] may be 
applied as 6 and 9 months, respectively”. This Article  involves the provision set out in Article 7.4 of 
the Anti-Dumping Agreement. Moreover, Article 4 of the Decree on the Prevention of Unfair 
Competition in Imports states that, “where, as a result of the investigation, it is determined that there 
are dumped or subsidized imports and that such imports are causing injury, a definitive anti-dumping 
duty or countervailing duty at an amount equal to th e margin of dumping or amount of subsidy or at a 
lesser amount or rate adequate to remove the injury shall be imposed to eliminate such injury”. Also 
in practice, Turkey imposes a lesser duty than the dum ping margin if the authority considers that this 
lesser duty is sufficient to remove the inju ry suffered by the domestic industry.  
 
Question:
 
 
In WT/TPR/S/125, Chapter III, footnote 45, it is mentioned that "In the case of fragmented 
industries involving an exceptionally large number of producers, the Turkish authorities may decide 
to initiate an investigation "ex officio" (without ha ving received a written application by or on behalf 
of a domestic industry), provided there is suffici ent evidence of dumping, injury, and a causal link 
(Article 4 of the Law and Article 20 of the Regula tion)". Could Turkey clarify if this is the only 
situation in which authorities are allowed to  initiate an investigation "ex officio"? 
  WT/TPR/M/125/Add.2 
 Page 7 
 
 
Answer:  
 
Article 4 of the Law No. 3577 on the Prevention of Unfair Competition in Imports sets out 
that, “the Directorate General may, upon complaint or, where necessary, ex officio, initiate a dumping 
or subsidy examination”. Article  20 of the Regulation on the Prevention of Unfair Competition in 
Imports sets out that, “as regards ex-officio initiation of an investigation, sufficient evidence,… , of 
dumped or subsidized imports and existence of injury on the domestic industry caused by such 
imports should be present”. Hence, the Law provides th e use of such procedure whenever it is deemed 
necessary, provided that the specified conditions exist. Also Article 5.6 of the Anti-Dumping 
Agreement provides that in case th e authorities “decide to initiate an investigation without having 
received a written application…, they shall proceed on ly if they have sufficient evidence of dumping, 
injury and a causal link,…, to justify the initiation of an investigation”. Should the Turkish authorities 
intend to initiate an ex officio investigation, they  shall definitely abide by these provisions laid out 
both in the Anti-Dumping Agreement and in the dom estic Legislation. However, the provision on ex-
officio initiation has not been invoked until present. 
 
Question (Brazil):  
 
 In WT/TPR/S/125, Chapter III, paragraph 47, it is also mentioned that "Definitive measures 
shall remain in force for five years from the da te of the conclusion of the most recent review 
investigation that has covered both dumping and injury examination or from the date of their 
imposition".  Is the possibility of maintaining the meas ure after the five years period restricted to the 
cases in which the review that covered both dumpi ng and injury examination has determined that  
(i) the continued imposition of the measure is nece ssary to offset dumping and (ii) that the injury 
would be likely to continue or (iii) recur if the measure were removed? 
 
Answer:  
 
 In accordance with Article 7 of the Decree on the Prevention of Unfair Competition in 
Imports, “definitive measures shall remain in force for 5 years, from the date of the conclusion of the 
most recent review investigation that has covered both dumping or subsidy and injury examination or 
from the date of their imposition”. Before the expiry  of the definitive measure in force, an expiry 
review investigation may be initiated. The same Artic le sets out the conditions for the extension of the 
duty by stating that, “in such an investigation, whet her the expiry of the duty would be likely to lead 
to a continuation or recurrence of dumping or subsidy and injury shall be examined”.  
  As also stated in Article 11.3 of the Anti-Dumping Agreement, “…any definitive anti-
dumping duty shall be terminated on a date not later than five years from its imposition (or from the 
date of the most recent review… if that review  has covered both dumping and injury…), unless the 
authorities determine, in a review initiated before th at date … that the expiry of the duty would be 
likely to lead to continuation or recurrence of dumping and injury”.  
 
The authorities abide by these rules in their c onduct of review investigations and sunset 
procedures. Hence, the five-year period of a defi nitive anti-dumping duty can only be extended when 
the conditions stated in the domestic Legislati on and the Anti-Dumping Agreement are fulfilled. 
 
Question (Brazil):
 
 
 Still regarding the question above, could Turk ey indicate how many reviews were initiated 
from 1995 up to September 2003?  And how many measures were rescinded after those reviews? 
 WT/TPR/M/125/Add.2 
Page 8  
 
Answer:
 
 
In the period from 1995 to September 2003, 13 revi ew investigations were initiated, of which 
2 are not yet concluded. Of these reviews, 6 resulted in the revocation of the duty. However, in most 
cases no expiry review was initiated for the measures  completing the five-year implementation period 
since there had been no request by any inter ested party for doing so. 28 measures were revoked 
(expired) as such without having carried out any sunset review investigations in the year 2000.  
S
TANDARDS AND OTHER TECHNICAL REQUIREMENTS  
Question (Brazil):  
 
 What products are subject to total or par tial ban under Turkey's technical regulations?  
 Answer:
 
 
According to Communiqué of Standardization for Foreign Trade No: (2004/3) and (2004/6) 
for the importation of certain chemical products, solid fuels, scrap metals (iron, steel, zinc, copper, nickel and aluminium), and wastes, the importer shall receive a Control Certificate issued by the Ministry of Environment. On the other hand, imports of some kind of wastes are prohibited according to the Basel Convention on the Control of Tran sboundary Movements of Hazardous Wastes and Their 
Disposal.  
 
Question (Brazil):
 
  Under Turkey's legislation, should the labe ling of packaged edible products carry any 
detached warning of the product being ma de with ingredients containing GMO ? 
 Answer:
 
 
There is no specific requirement in this area.  
 
Question (Brazil):  
  To what extent has Turkey aligned its  legislative framework with the EU " acquis 
communautaire " concerning technical standards and regul ations, general product safety, sanitary and 
phytosanitary measures, intellectual prope rty rights and consumer protection? 
 
Answer: 
 
 
 The conclusions of the Helsinki European Council in December 1999 recognized Turkey as a 
candidate for membership to the European Union. As a candidate country Turkey has to approximate 
the whole body of EU legislation known as the acquis communautaire.   
 
Free Movement of Goods 
  According to Decision 1/95 of the EC-Turkey Association Council, establishing the Customs 
Union, Turkey had to finalize, before the end of 2000 , the harmonization of its technical legislation, in 
areas of direct relevance to the Customs Union. With in this context, the Association Council Decision 
2/97 listed the areas in which Turkey shall a lign its legislation to that of the EU.  
  WT/TPR/M/125/Add.2 
 Page 9 
 
 
 Turkey, following the entry into force of the Customs Union, has removed all customs duties, 
charges having equivalent effect and quantitative re strictions on industrial pr oducts. Thus, with the 
exception of technical legislation, there is free m ovement of industrial produc ts between the EU and 
the Turkey. In line with the A ssociation Council Decisions n° 1/95 and 2/97, a Framework Law 
relating to the preparation and implementation of the technical legislation regarding products has 
entered into force on 11 January 2002. This Fram ework Law establishes the legal basis for full 
harmonization with the EC legislation, and it lays down the basic principles for product safety and the 
implementation of Old and New Approach Directives . It sets out the conditions of the placing on the 
market of the products, the liabilities of the produ cers and distributors, the conformity assessment 
bodies, notified bodies, market surveillance and inspection, the prohibition of the placing on the 
market of certain products, the withdrawal and d estruction of the marketed products as well as the 
notifications relating to these arrangements.    The Framework Law is complemented by five secondary legislations (by-laws) in order to 
become operational on the ground: (i) market surve illance and control of the products, (ii) use and 
affixing of the CE conformity mark, (iii) work ing principles and procedures for the conformity 
assessment bodies and notified bodies and their assignmen ts, (iv) exchange of information on national 
measures derogating from the principle of the free m ovement of goods and (v) notification procedures 
between Turkey and the EC regarding technical legi slation. The first three legislations have been 
published in the Official Gazette on 17 January  2002 and are applicable retroactively as from 
11 January 2002. The forth one is  still under consultation with the European Commission. The fifth 
one, regulation on the notification procedures be tween Turkey and the EC regarding technical 
legislation has been published on 3 April 2002.   Accordingly, in the field of Free Movement of Goods, 240 out of 464 directives have been  harmonized and have entered into force.  
 
General Product Safety 
 
 Concerning general product safety, important projects have been submitted to the Pre-
Accession Financial Cooperation Progr ams in order to set up the market surveillance system in 
accordance with the EU structures. The system is  expected to begin operating in 2004. Further, 
establishing an information network is planned fo r the notification of dangerous products on a 
national basis. Efforts for the inclusion of a project prepared for food products in the 2004 Programming Pre-Accession Fina ncial Cooperation continue.  
 
Sanitary and Phytosanitary  
  In the field of phytosanitary, legislative harmonization work is being carried out through a 
number of working groups established in the sub -fields of harmful organisms, plant protection 
products, plant variety rights, and seeds and seedlings . A Law on the plant variety rights in line with 
the EU rules and UPOV Convention is soon expected to  enter into force. Another key legislation on 
the registration and authorization of plant protec tion products (including pesticides), in conformity 
with the EU directive 91/414 and other related EU legislation, is about to be published. A major 
project aimed at legislative alignment with the EU Acquis  has been launched within the framework of 
Turkey-EU Financial Cooperation Programme, wh ich includes upgrading certain laboratory and 
testing facilities throughout Turkey.  
 Within this framework, in the field of Phytosanitary, by the end 2005 most of the legislation 
will be harmonized.   WT/TPR/M/125/Add.2 
Page 10  
 
Intellectual Property Rights 
 
 With Law No. 5846 on Intellectual and Artistic Works and Law No: 4630 amending Law No. 
5846, considerable alignment with the EU Acquis  on intellectual property rights has been 
accomplished. Nonetheless, efforts proceed for full harmonization concerning resale rights, copyright 
and related rights in the information society, which ar e in general terms already in conformity with the 
relevant Community legislation. Accordingly, legisl ative drafting continues for the legal protection of 
databases and the rights of their producers.    For effective implementation of  the arrangements on intellectual property rights, combating 
piracy has significant importance. To this end,  Law No: 4630 introduced significant changes, 
including effective mechanisms to prevent piracy , which is recognized as an organized crime.  
  Along with the preceding activities, with a view  to removing the conf licts within national 
legislation, a draft law was prepared to re a rrange fines and imprisonment in Law No. 3257 on 
Cinema, Video and Music Works according to the provisions of Law No. 5846. Further, having 
scrutinized the Proposal for a directive of the Eu ropean Parliament and of the Council on measures 
and procedures to ensure the enforcement of intelle ctual property rights (30 January 2003), a Draft 
Communiqué on The Rules To Be Obeyed By Recording Facilities Reproducing Intellectual and Artistic Works and Facilities Producing Empty Carrying Materials was prepared as the first attempt to 
incorporate the provisions of Article 22 of the Pr oposal. With this Communiqué, it will be mandatory 
to fix international codes on CD, VCD and DVDs, using implem entations such as SID (Source 
Identification Code), ISRC (International Standard Recording Code). Thus production and recording 
facilities will be regulated.   In addition, there is an ongoing project in th e field of intellectual and industrial property 
rights. The aim of the project is to fulfill the remaining commitments stemming from the Customs 
Union and to ensure effective and prompt impl ementation of the legislation by the courts.  
 
 Accordingly, in the field of Intellectual Property Rights, 7 out of 24 directives have been  
harmonized and entered into force.   Consumer Protection  
 In order to align with the EU Directives regarding consumer protection, Law No. 4822 
Amending Certain Provision of the Law No. 4077 on th e Protection of Consumer has been put into 
force on 14 June 2003. In addition to this law, thirteen implementing regulations have also been 
published. Within this framework, Turkey has accomplished its legislative alignment regarding 
consumer protection.   
In the field of Consumer Protection, a tota l of 18 directives have been  harmonized and 
entered into force.  Question (Brazil):
 
 
How is the accreditation system organized in  Turkey? How does the central government 
participates in the certification process ? In what ex tent does Turkey use the Suppliers Declaration of 
Conformity as an conformity assessment procedure ? 
  WT/TPR/M/125/Add.2 
 Page 11 
 
 
Answer:  
 
 “The Law on Establishment and Tasks of  Turkish Accreditation Agency” no. 4457 was 
published in the Official Gazette and put into for ce on November 4, 1999 to accredit the conformity 
assessment activities in Turkey. The law is intended to ensure that the conformity assessment bodies, 
namely private and public laboratories, inspecti on and certification bodies are approved by Turkish 
Accreditation Agency (TÜRKAK) for operation under the respective legislation, in voluntary and 
involuntary areas, in accordance with internationa lly recognized technical criteria. TÜRKAK is an 
agency, which is related to the Prime Ministry and is  subject to the provisions of private law enjoying 
administrative and financial autonomy.  
The national accreditation system operated by  TÜRKAK consists of the following basic 
components:  
 
1. Criteria for accreditation 
2. Infrastructure for traceability of measurements (metrology) 
3. Impartial – Independent and effici ent assessment capability (assessors pool) 
4. Sectoral Technical Committees 
 II. TRADE POLICIES BY SECTOR 
A
GRICULTURE  
Question (Brazil):  
 
 Paragraph 12 of section IV ("Trade Policies by Sector") in the document WT/TPR/S/125 
states: "The policies of aids and support to agricultu re, in place at the time of the last TPR of Turkey, 
have resulted in over-production of many agricu ltural commodities, especia lly hazelnuts and tobacco, 
and in the constant fall in agricultural productivity over the past decade. Mo reover, the policies have 
failed to relieve poverty for subsiste nce farmers. The Government's res ponse to this is contained in the 
2001-05 Agricultural Reform Implementation Project (A RIP)..." In the same paragraph, it is stated 
that: "The main aims of ARIP are to: phase out pr ice support and credit subsidies; withdraw the State 
from direct involvement in production, processing,  and marketing of crops; and introduce a less 
distortionary direct income support (DIS) system to farmers, based on land rather than on inputs or output. At the same time, ARIP is designed to miti gate the potential short-term adverse impact of 
subsidy removal and facilitate the transition to effi cient production patterns". In the next paragraph, 
the components of ARIP are defined as follow: "...(i ) DIS payments; (ii) farmer transition payments; 
(iii) restructuring of the Agricultural Sales Co-ope ratives (ASC) and their Unions (ASCU); and (iv) 
improvement of support services...". Regardi ng that, the following questions arise: 
 
 What is the difference between components (i) and (ii)? Does component (ii) deal only with 
hazelnuts and tobacco?  Answer:
 
 
 Component A: Direct Income Support (DIS):  The objective of DIS component is to design 
and establishment of a nation wide fa rm and land registration system to provide assistance to eligible 
farmers starting from less developed areas to more de veloped areas. Such areas will be selected based 
upon transparent and objective criteria such as so cio-economic development index. While direct 
income support payments are financed from Gove rnment budget, goods and services are financed by 
loan proceeds.   WT/TPR/M/125/Add.2 
Page 12  
 
 Component B: Farmer Transition Support (FT):
 The objective of FT component is to 
provide financial support to the pa rticipating farmers who convert from producing highly subsidized 
and economically unsustainable crops (hazelnut and t obacco), to more sustainable crops, through the 
financing of grants to cover the cost of goods, services and works related to crop conversion.  
 
 The difference between two components is the source used in financing payments. While DIS 
payments are financed from government budget, FT payments (for uprooting costs, input costs for 
new crops and preparing and tending fields) are funding from loan proceeds. FT component is now 
covering only hazelnut and tobacco but restru cturing studies on component is enduring.  
 Question (Brazil):
 
 
Is DIS notified in WTO Agriculture Committee as  direct payment? And the "farmer transition 
payments" (ii)? How do they fit in the criteria defined by the AoA? 
 
Answer:  
  Notification of DIS and farmer transition payments to the WTO will be possible upon 
completion of the Agricultural Reform Progr amme and the relevant database in 2005. 
 
Question (Brazil):
 
 
 How is component (iii)being implemented? Ho w does the Turkish government intervene with 
cooperative structures? 
 Answer:
 
 
 The program of “Restructuring of agricu ltural sales cooperatives and unions” focuses on 
turning the quasi-governmental sales cooperative unions  previously used to administer support prices, 
into organizations dedicated to serving their fa rmer members. The restructuring activities include 
compensatory payments for the dism issal of excess workers, and technical support to the ASCU’s to 
establish managerial capacity.   
Question (Brazil):
 
 
 Is there any priority in the implementation of the four components of ARIP?  
Answer:
 
 
There are no priorities in the implementation of four components of the ARIP.  
 
Question (Brazil):  
 
 In paragraph 19 of section IV (WT/TPR/S/125) , it is mentioned that: "...In 2002, most 
administered prices were abolished. However, the Turkish Grain Board continues to set purchasing 
prices for cereals before the purchasing campaign; purchasing prices increased by around 36% for 
tobacco, about 40% for wheat and maize, and 50% fo r oats (Table IV.2).  The purchasing price for 
sugar beet increased by 48% d espite an increase of 9.6% in the production quota to 12.6 million 
tonnes of sugar beet..." How does this practice is made compatible with the ARIP policy 
(paragraph 12)?   WT/TPR/M/125/Add.2 
 Page 13 
 
 
Answer:  
 
 The administered purchasing prices for cereal take place within the ARIP policy. Turkish 
Grain Board (TMO) works as an intervention agency like the similar institutions in EU. It only 
procures 10-15 % of the grain production. The prices set by TMO resemble the lower limit and if prices fall below these prices, TM O intervenes into the market. 
  However, sugar beet is not included in ARIP . As specified in the Sugar Law, which was 
entered into force in 19 April 2001, sugar quotas (and related sugar beet quotas) are determined in line 
with the domestic demand by the Sugar Board a nd sugar beet prices are determined in agreement 
between sugar companies and farmers. On the othe r hand, increase in sugar beet purchasing prices 
reflect the inflation rate of the related year.    Cultivation of tobacco and hazelnut have e xpanded outside of the allowed production lands, 
moreover, tobacco and hazelnut are traditional export items. To that end, they have been included in 
the ARIP project.    After the enactment of Tobacco Law (Dated January 3
rd, 2002, number 4733), The Alcohol 
and Tobacco Monopoly (TEKEL) procures tobacco up to its annual production requirements.  
 
 The main reasons for the increases in purchasing pr ices of agricultural products are the rise in 
the production costs of the farmers (such as fuel oil,  fertilizer, and seeds) and the inflation. Therefore 
the above-mentioned practices are in line with ARIP implementation.   Question (Brazil):
 
 
 In paragraph 24 of section IV (WT/TPR/S/125), there is a mention on a "deficiency payment" 
mechanism: "In 1998, deficiency payments were a pplied to cotton and olive oil, and in 1999, they 
applied to cotton, sunflower seed, and soybean. As from 2000, deficiency payments have covered 
olive oil and canola. These payments amounted to TL186,150 billion in 2002 and are expected to be 
TL 264,000 billion in 2003.  In addition, direct paym ents were introduced for silk cocoon and mohair 
in 2002 for TL 1,111 billion.". How does this me chanism is made compatible with the ARIP 
objectives?  Answer:
 
 
 In the first years of implementation of the DIS system, the internal marketing channels could not be established properly, and relevant guidance could not be disseminated to agricultural sector. 
Therefore, the expected shift from the products wher e there is surplus to the products where there is 
shortage could not be provided.  
  The deficiency payment mechanism is being im plemented for the products in which Turkey is 
net importer. During ARIP implementation this issu e was also taken into consideration with the 
World Bank, and the Bank agreed to preserve defi ciency payment mechanism within the context of 
agricultural support system.  
 
Question (Brazil):
 
 
 In paragraph 14 of Section IV (WT/TPR/S/125), it is stated: "The objective of the second 
component of ARIP is to provide farmers with a one -off transfer to help them in the transition to 
alternative and more profitable activities as govern mental support is reduced.  The most serious 
problems are concentrated in tobacco and hazelnut  production, which are a heavy burden on the fiscal WT/TPR/M/125/Add.2 
Page 14  
 
budget because of excess supply and the Government's  purchases of excess supply". On paragraph 18, 
it is mentioned that "The Tobacco Law ended the practice of administered support prices by the Government through TEKEL, the state monopoly for al cohol, tobacco, and salt, which is also to be 
privatized in 2003. Purchasing prices are now market determined, and the quota on tobacco 
production was removed in 2002." Further, in para graph 19, we can read that "In 2002, most 
administered prices were abolished. However, the Turkish Grain Board continues to set purchasing 
prices for cereals before the purchasing campaign; purchasing prices increased by around 36% for 
tobacco..." Nevertheless, statistics of tobacco trad e show that Turkey still exports around 50 per cent 
of its domestic production, regardless of the downfa ll in the production. Since Turkey has not notified 
exports subsidies on tobacco(G/AG/N/ TUR/13), is there any policy implemented to keep such a share 
of domestic production for export? 
 
ANNEX: 
Table of Statistics on Turkey Tobacco Production and Trade 
Year 98/99 99/00 00/01 01/02 02/03 Average 
Dry Weight Production 217.570 207.830 207.911 172.027 133.812 187.830 
Exports 128.808 115.710 100.900 96.450 88.840 106.142 
 
Source:  PSD Official Statistics. 
 
Answer:  
 
There is no support payment made in the area of exports within the scope of the ARIP 
Project. Also, there is not any policy implemented in  order to keep such a share of domestic tobacco 
production for export.  S
ERVICES  
Question (Brazil):  
 
 It is said (Document WT/TPR/S/125, page ix , paragraph 20): "Turkey has taken measures to 
address some of the structural problems in certain services activities, notably banking and 
telecommunications, where independent regulators have been appointed and the scope of the 
liberalization and privatization process has been extended." 
 
 What are the main sectors foreseen to be privatized?  Answer:
 
 
 As stated in the government report, Turkey embarked upon a massive and very extensive plan 
to privatize almost all of its public sector. The obj ective of ultimate full membership to the European 
Union accompanied by the fact that in order to achieve macroeconomic stability and sustainable growth requires the state to withdraw from all of the sectors including electricity transmission, mining and perhaps in the future social security.  
 Telecommunications, petroleum refining, petroc hemicals, tobacco, fertilizer, sugar industry, 
air transport, power generation and distribution, na tional lottery, banking, tourism, agriculture, some 
remaining textile plants, motor vehicle inspecti ons  and even privatizing both Istanbul Stock 
Exchange and Gold Bourse are some of the sect ors which are on the government’s privatization 
agenda.   WT/TPR/M/125/Add.2 
 Page 15 
 
 
Question (Brazil):  
 
 It is said (Document WT/TPR/S/125, page 09, paragraph 21): "Balance-of-payments data 
indicate that Turkey continues to be a net exporter of services, albeit with a decreasing surplus (Table 
I.2)." What are the export services sector s responsible for the trade surplus? 
 Answer:
 
 
 Turkey’s income from the services sector fell from US$20.4 billion in 2000 to US$16 billion 
and US$14.8 billion in 2001 and 2002, respectively.  The main reason behind this decrease was the 
economic crisis of 2001, which affe cted all economic sectors of Turkey. However, tourism receipts 
increased in the mentioned years resulting from the good performance of the sector, as well as the 
devaluation of the Turkish Lira. Hence, the in th e tourism receipts caused a continuing surplus in 
services trade.  Question (Brazil):
 
 
 It is said (Document WT/TPR/S/125, page  10, paragraph 25): "Since 1998, manufacturing 
and services have attracted almost all FDI inflows into Turkey;(...)" What are the sectors of services 
that receive the largest amounts of foreign investments?  Answer:
 
 
Communications sector (especially cellular phone services) has the largest share in foreign 
direct investment within the services sec tor between 01.01.1998 and 31.12.2003. 
 
 As of December 31, 2003, the share of communi cation was 29.2%. It is followed by banking 
and other financial services (26.9%), financial in stitutions (15.2%), trade (11.6%), hotels (4.8%), 
other social services (3.2%) and services related with transportation (3.1%)   
 Note: Classification of sub-sectors is  made according to ISIC Rev.2.  
 
Question (Brazil):
 
 
It is said (Document WT/TPR/S/125, page 116, paragraph 134): "Public Law No. 4054 on the 
Protection of Competition does not grant any special exemptions to the national air transport services 
industry." Are there any other effects of the Public Law No. 4054 in services area? 
 
Answer:  
  The statement of paragraph 134 on page 116 of the document WT/TPR/S/125 reads as 
follows:   “Public Law No. 4054 on the Protection of Competition does not grant any special 
exemptions to the national air transport services i ndustry.  No special privileges are granted to the 
state-owned air companies, except that, where possibl e, Turkish civil servants are obliged to use the 
national airline for official travel overseas.”   As mentioned within this statement, no exemp tion is granted to Turkish national flag carrier 
company, namely Turkish Airlines (THY as the abbreviation of Türk Hava Yollar ı) by Competition 
Act (Law No: 4054). As a very recent development,  domestic lines are open to competition, as well as 
international lines. Consequently, competitors of  THY have commenced operating flights between WT/TPR/M/125/Add.2 
Page 16  
 
national airports on 9 December 2003. All practices  of THY, as well as those of its competitors are 
subject to Competition Act.    Besides air transportation, no enterprise operating in any service sub-sector is exempted from competition rules.  
 
 As a conclusion, the Competition Act encourag es competition in the services sector and its   
sub-sectors.   
Question (Brazil):
 
 
 It is said (Document WT/TPR/S/125, page 118, paragraph 144): "The Turkish Government 
remains active in the tourism subsector. It grants  incentives for tourism investments in accordance 
with the Tourism Encouragement Law; (...)Invest ors in the tourism sector also have access to 
incentives granted under the general investment aid programme (Chapter III(2)(iii)(d))." How 
specifically are the incentives to investment gr anted in the tourist sector within the General 
Investment Aid Programme? 
 
Answer:  
 
 Since the GIEP makes no sectoral selection among the industrial sectors or services, 
applications for an investment encouragement certif icate in the tourism sector is treated on an equal 
basis with the others and the application procedure is the same for all investment projects. General 
characteristics of the GIEP are mentioned in the text  covering Turkey’s replies to written questions by 
Members which was distributed on 19 December 2003. 
 
Question (Brazil):  
 
 In Turkey's schedule there are no commitmen ts for Distribution Services. Are there any 
restrictions of Market Access and National Treatment according to GATS disciplines? Please indicate 
the legislation that rules the provision of these services.  Answer:
 
 
 The coverage of the distribution services is ve ry broad. It comprises the distribution services 
of the agricultural and industrial products, raw ma terials, intermediate and manufactured goods under 
the classification of commission agents’ services, wholesale trade services and retailing services. In 
Turkey, there is not only one regulation that sets the rules of the distribution services. The legislation related to the distribution services and the institutio n which is responsible fo r the implementation of 
this legislation may vary depending on the category of the product.   
 
__________