WORLD TRADE  
ORGANIZATION  G/SG/N/8/TUR/7 
G/SG/N/10/TUR/7 
G/SG/N/11/TUR/7/Suppl.1 
6 February 2007 
 (07-0518) 
Committee on Safeguards Original:   English 
  
 
 
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE AGREEMENT 
ON SAFEGUARDS ON FINDING A SERIOUS INJURY OR  
THREAT THEREOF CAUSED BY INCREASED IMPORTS 
 
NOTIFICATION PURSUANT TO ARTICLE 12.1(C) 
OF THE AGREEMENT ON SAFEGUARDS 
 
NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2 
OF THE AGREEMENT ON SAFEGUARDS 
 
TURKEY 
 
(Motorcycles)
 
 
 
 The following notification, dated 2 February 200 7, is being circulation at the request of the 
Delegation of Turkey.  
_______________ 
  
In light of the agreed format for notifications (G/SG/W/1, 23 February 1995), Turkey 
provides notification to the Committee on Safeguards of  findings of serious injury or threat thereof 
caused by increased imports and notification of proposed safeguard measures. 
On 15 August 2006, Turkey initiated an investig ation and took provisional safeguard measure 
relating to serious injury or threat thereof to dome stic producers of products like or directly competing 
with the imported product.  The initiation of the investigation has been notified to the Committee on 
Safeguards.
1  
Consistent with Article 12.3 of the Agreement on Safeguards , Turkey is prepared to consult 
with those Members having a substantial inte rest as exporters of the product concerned. 
                                                      
1 G/SG/N/6/TUR/10, G/SG/N/7 /TUR/1and G/SG/N/11/TUR/7. G/SG/N/8/TUR/7 
G/SG/N/10/TUR/7 G/SG/N/11/TUR/7/Suppl.1 
Page 2 
  
  I. EVIDENCE OF SERIOUS INJURY OR THREAT THEREOF CAUSED BY 
INCREASED IMPORTS 
A. E
VIDENCE OF SERIOUS INJURY  
 In order to make a determination of serious injury to the domestic industry of the like or 
directly competing product, an evaluation of all relevant factors of an objective and quantifiable 
nature having a bearing on the situation of the industry has been undertaken.  The petitioners are 
domestic producers that represent the majority of the domestic production.  The following evaluation 
has been based upon data provided by the applicants and other domestic producers.  
 
1. Consumption  
 
 
 The data in the table show an increase in moto rcycle demand in Turkey after 2002.  The rates 
of increase in consumption were 200 per cent in 20 03, 300 per cent in 2004 an d 111 per cent in 2005. 
2. Capacity and capacity utilization  
 2001 2002 2003 2004 2005 
Capacity  
(thousand pcs)  188 188 188 195 195 
Capacity utilization 
rate (%) 16 12 30 41 41 
 
 Total capacity of domestic producers has increased from 188 thousand pcs to 195 thousand 
pcs in 2004 and remained stable in 2005.  
 
The capacity utilization fell in 2002;  afterwards it increased due to the growth in the market 
in 2003 and 2004.  However, this increase has been  poor to reflect the enlargement of domestic 
market.  In 2005, the capacity utilization rate remained stable. 
3. Production 
2001 2002 2003 2004 2005 Production  
(thousand pcs)  30 22 56 79 80 
 
Looking at the domestic production figures, it is  observed that produc tion dropped by 27 per 
cent in 2002 and started rising agai n in subsequent years.  In 2 005, increase in production was 1 per 
cent although the domestic market grew by 111 per cent compared to 2004. 
4. Domestic sales volume 
2001 2002 2003 2004 2005 Domestic sales 
(thousand pcs)  18 11 26 52 46 
 2001 2002 2003 2004 2005 Consumption  
(thousand pcs) 23 14 42 168 355  G/SG/N/8/TUR/7 
 G/SG/N/10/TUR/7 
 G/SG/N/11/TUR/7/Suppl.1 
 Page 3 
  
  The domestic sales of producers dropped by 39 pe r cent in 2002, and showed an increase in 
2003 and 2004.  Domestic sales fell by 12 per cent in 2005 as imports reached its highest volume. 
5. Inventories 
2001 2002 2003 2004 2005 
End of period inventories 
(thousand pcs) 1,4 2,0 1,6 2,1 5,9 
 
It is observed that end of period inventories of  domestic producers rose by 43 per cent in 2002 
and dropped by 20 per cent in 2003.  The inventori es continuously increased in subsequent years and 
reached 5,9 thousand pcs in 2005. 
6. Employment 
2001 2002 2003 2004 2005 Employment 
(Persons)  471 388 686 914 832 
 
The employment figures of domestic producers have fluctuated in the period under 
examination.  In 2005, a fall by 9 per cent occurred in employment, as a result of the decrease in the 
share of domestic producers in the growing domestic market. 
7. Market share of domestic products 
2001 2002 2003 2004 2005 Market share  (%) 77 79 61 31 13 
 
The market share of domestic production increased  from 77 per cent in 2001 to 79 per cent in 
2002; yet it has decreased rapidly in subsequent year s.  The market share, which dropped to 61 per 
cent in 2003 and 31 per cent in 2004, has come down to  13 per cent in 2005, the lowest value of the 
period under examination. 
8. Price of the like or directly competing product and undercutting 
Price undercutting, which was calculated by a comparison of average prices of imported and 
domestic products to the dealers, is shown in the table below. 
2001 2002 2003 2004 2005 2006 (1-7) Price undercutting 
(%) - 0-54 - 32-41 35-46 15-49 
 
The result shows that domestic prices were unde rcut by import prices in 2002, 2004, 2005 and 
in the first 7 months of 2006. 
9. Profitability 
2001 2002 2003 2004 2005 Profitability index 
(2002=100) Loss 100 105 94 43 
 G/SG/N/8/TUR/7 
G/SG/N/10/TUR/7 G/SG/N/11/TUR/7/Suppl.1 
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  The profitability index of the domestic producers,  whose market share sharply declined, has 
come down to 43 in 2005. 
10. Productivity 
2001 2002 2003 2004 2005 
Productivity  
(Pcs/Person) 63 58 82 87 97 
 
Looking at the productivity figures of domestic production operations, it is  observed that after 
the decline in 2002, producers steadily increased th eir productivity.  The productivity, which was 63 
in 2001, reached 97 in 2005.  
11. Conclusion 
The data shows stagnant or negative devel opments for capacity utilization, production, 
domestic sales, market share, inventories, employ ment and profitability especially in 2004 and 2005. 
Imports have increased in the period under i nvestigation from 5 thousand pcs in 2001 to 309 
thousand pcs in 2005, which means a 61 times increase in the level of imports.  It is noteworthy that, 
as imports increased by 166 per cent in the year  2005 compared to the year 2004, the domestic 
industry’s sales volume decreased by 12 per cent and profitability decreased by 54 per cent. 
The domestic industry has continuously lost mark et share which reached its lowest level in 
2005.   
Taking into account of all of these factors, th e investigating authority concludes that the 
domestic industry has suffered serious injury.   
B. CAUSATION ANALYSIS  
In order to examine the existence of a causal link between increased imports and the serious 
injury, and in order to ensure that  injury caused by other factors is not attributed to increased imports, 
the investigating authority analyzed the effects of the following factors: 
1. Analysis of causation factors 
- Effect of increased imports 
Imports have increased from 5 thousand pcs in 2001 to 309 thousand pcs in 2005 which 
means a 6080 per cent increase throughout the period u nder investigation.  In addition, imports have 
grown from 18 per cent in 2001 to 383 per cent of the domestic production in 2005, indicating that 
imports have also increased relative to production, at  the expense of the domestic industry.  Over the 
same period, the market share of imports grew fro m 23 per cent to 87 per cent, whilst the market share 
of the domestic industry fell from 77 per cent to 13 per cent.  
Average import price of the like or direc tly competing product decreased from 968 US 
Dollars per piece to 635 US Dollars per piece between  the years 2001 and 2005.  The average price of 
the imported product, which decreased by 31 per cent in this period, has dropped to 506 US Dollars 
per piece in the first 7 months of 2006.  Based on a comparison of average wholesale prices of domestic and imported products, domestic prices we re undercut between 32 per cent and 54 per cent 
throughout the 5 year-period examined.  Price unde rcutting has continued between 15 per cent and 49  G/SG/N/8/TUR/7 
 G/SG/N/10/TUR/7 
 G/SG/N/11/TUR/7/Suppl.1 
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  per cent in the first 7 months of 2006.  The fall in  prices taken together with the fall in sales volume 
occurred at the same time as the domestic industry’ s profitability index fell from 100 in 2002 to 43 in 
2005. 
For the foregoing reasons, the investigating aut hority concludes that there is a correlation 
between the increase in imports at low prices and th e serious injury suffered by the domestic industry, 
and that the increase in imports has had injurious e ffects, particularly in terms of downward pressure 
on prices and a reduction in the volume of sales of the domestic industry in the domestic market. 
- Other factors 
 
(a) Effect of changes in consumption:  Consumption of the product concerned has not 
fallen between 2001 and 2005.  On the contrary, the consumption has increased from 23 thousand pcs 
in 2001 to 355 thousand pcs in 2005. 
(b) Effect of competition between the domest ic producers:  There is no additional new 
producer entering into the sector.  Therefore, no adverse effect of domestic competition appears.  
(c) Alternative products and changes in cons umer preferences:  Domestic producers are 
capable of adjusting their production to changing co nsumer preferences in terms of model or quality.  
Change in consumer preferences in Turkish market is  based on fluctuations in price, instead of quality 
or technical qualifications of the product.   
(d) Production capacity:  The investigating aut hority determined that excess capacity did 
not contribute to the injury suffered by the domestic industry.  
(e) Changes in financial costs:  The investig ating authority determined that changes in 
financial costs did not contribute to the injury suffered by the domestic industry. 
(f) Effects of changes in export performance:  The effect of variations in the level of 
exports has also been examined.  The exports, whic h fluctuated during the period of investigation, 
increased from 12 thousand pcs in 2001 to 31 thousand p cs in 2003.  However, there is no increase in 
exports between 2003 and 2005.  Hence, there is no link between the changes in exports and the 
injurious effects observed.  
In conclusion, no other factors which could have contributed to the injury apart from the 
increase in imports were identified.   
2. Conclusion on causation 
After having examined the injurious effects of  the other known factors, the investigating 
authority has reached the conclusion that there is  a genuine and substantial link between increased 
imports and serious injury to the domestic industry. 
II. INFORMATION ON WHETHER THERE IS AN ABSOLUTE INCREASE IN 
IMPORTS OR AN INCREASE IN IMPORTS RELATIVE TO DOMESTIC 
PRODUCTION 
An analysis of the increase in imports to Tu rkey of the product concerned has been carried 
out over the period from 2001 to 2005, both in absolu te terms, and relative to domestic production.  
Imports of the product concerned increa sed considerably in that period. G/SG/N/8/TUR/7 
G/SG/N/10/TUR/7 G/SG/N/11/TUR/7/Suppl.1 
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  1. Volume of imports 
The table below shows the development of moto rcycle imports for the years 2001-2006.   
2001 2002 2003 2004 2005 2005 (1-7) 2006 (1-7) 
Imports 
(thousand pcs)  5 3 17 116 309 161 498 
 
Volume of imports decreased from 5 thousa nd pcs to 3 thousand pcs due to the macro-
economic crisis occurred in Turkey in that year.  In the following years, the imports increased by 
466 per cent, 582 per cent and 166 per cent in 2003, 2 004 and 2005 respectively.  In the first 7 months 
of 2006, imports increased by 209 per cent comp ared to the same period of 2005 and reached to 
498 thousand pcs.  
2001 2002 2003 2004 2005 Imports/ 
Domestic production  (%) 18 13 30 146 383 
 
Relative to total domestic production, imports increased regularly from 2001 to 2005.  The 
ratio demonstrated a significant upward trend st arting from 2003.  Imports reached 30 per cent, 146 
per cent and 383 per cent of domestic production in 2003, 2004 and 2005 respectively. 
2. Market share of imports 
2001 2002 2003 2004 2005 Market share of  
imports  (%) 23 21 39 69 87 
 
The market share of imports increased regularly starting from 2002.  It reached 39 per cent, 
69 per cent and 87 per cent in 2003, 2004 and 2005 respectively. 
III. PRECISE DESCRIPTION OF THE PRODUCT INVOLVED 
The product concerned is motorcycles (including  mopeds) and cycles fitted with an auxiliary 
motor (with reciprocating internal combustion piston engine of a cylinder capacity not exceeding 380 cm³) which is currently classified within the Turkish Customs Tariff Schedule under 
8711.10.00.00.11, 8711.10.00.00.19, 8711.20.10.00.00, 8711.20.91.00.00, 8711.20.93.00.00, 
8711.20.98.00.00 and 8711.30.10.00.00.  
IV. DESCRIPTION OF THE PROPOSED MEASURE 
It is proposed to impose definitive safeguard meas ure in the form of fixed duty, which will be 
implemented for the imports having CIF value lower th an those shown in the th reshold column of the 
table below. 
  G/SG/N/8/TUR/7 
 G/SG/N/10/TUR/7 
 G/SG/N/11/TUR/7/Suppl.1 
 Page 7 
  
  Fixed duty (USD per piece) 
Customs code  
of the product Threshold 
(USD per piece)1st  Period
(2/3/2007-
14/8/2007) 2nd Period
(15/8/2007-
14/8/2008) 3rd Period 
(15/8/2008- 
14/8/2009) 
8711.10.00.00.11 1.200 200 190 180 
8711.10.00.00.19 1.400 200 190 180 
8711.20.10.00.00 2.000 250 235 220 
8711.20.91.00.00 1.400 200 190 180 
8711.20.93.00.00 2.000 250 235 220 
8711.20.98.00.00 2.300 300 285 270 
8711.30.10.00.00 2.600 300 285 270 
 
Below is the list of Developing Countries, ex cluded from the measures as they export less 
than 3 per cent of imports to Turkey (Article 9.1 of the Agreement on Safeguards ). 
Afghanistan; Algeria;  Antigua and Barbuda;  Angola; Argentina;  American Samoa; 
Anguilla;  Antarctica;  Aruba;  Azerbaijan;  Barb ados;  Bangladesh;  Burkina Faso;  Bahrain;  
Burundi;  Benin;  Belarus;  Bolivarian Republic of Venezuela;  Brunei Darussalam;  Bolivia;  Brazil;  
Bahamas;  Bhutan;  Botswana;  Belize;  Bermuda ;  Bouvet Island;  British Virgin Islands;  British 
Indian Ocean Territory;  Democratic Republic of Congo;  Central African Republic;  Congo;  Côte 
d'Ivoire;  Cameroon;  Chad;  Colombia;  Costa Rica ;  Cuba;  Cape Verde;  Cayman Islands;  Chile;  
Christmas Islands;  Cocos Islands;  Cook Islands ;  Djibouti;  Dominica;  Dominican Republic;  
Ecuador;  Egypt;  Eritrea;  Ethiopia;  Fiji;  Federate d States of Micronesia;  Falkland Islands;  French 
Polynesia;  French Southern Territories;  Gabon;  Gr enada;  Ghana;  Gambia;  Georgia;  Greenland;  
Guinea;  Equatorial Guinea;  Guatemala;  Guinea- Bissau;  Guyana;  Gibraltar;  Guam;  Honduras;  
Haiti;  Heard Island and McDonald Isla nds;  Indonesia;  Iraq;  Iran (Islamic Republic of);  Jamaica;  
Jordan;  Kazakhstan;  Kenya,  Cambodia;  Kiribati;  Comoros;  St Kitts and Nevis;  Kuwait;  Kyrgyzstan;  Laos;  Lebanon;  St Lucia;  Sri Lanka;  Liberia;  Lesotho;  Libyan Arab Jamahiriya;  Morocco;  Madagascar;  Marshall Islands;  Mali;  Moldova;  Mongolia;  Mauritania;  Mauritius;  
Malaysia;  Maldives;  Malawi;  Mozambique;  Maca o;  Mayotte;  Mexico;  Montserrat;  Namibia;  
Niger;  Nigeria;  Nicaragua;  Nepal;  Nauru;  Ne therlands Antilles;  New Caledonia;  Niue Island;  
Norfolk Island;  Northern Mariana Islands;  Oman; Panama;  Peru;  Papua New Guinea;  Philippines;  
Pakistan;  Palau;  Paraguay;  Pitcairn;  Qatar;  Ru ssian Federation;  Rwanda;  Samoa;  Saudi Arabia;  
Solomon Islands;  Seychelles;  Sudan;  Sierra Le one;  Senegal;  Somalia;  Suriname;  Sao Tomé and 
Principe;  El Salvador;  Syrian Arab Republic ; Swaziland;  South Geor gia and South Sandwich 
Islands;  St Helena and dependencies;   St Pierre and Miquelon;  Tajikistan;  Togo;  Tunisia;  Tonga;  
East Timor;  Trinidad and Tobago;  Turkmenistan;  Tuvalu;  Tanzania;  Tokelau;  Turks and Caicos 
Islands;  Ukraine;  United Arab Emirates;  United States Minor outlying islands;  Uganda;  Uruguay;  
Uzbekistan;  St Vincent;  Vietnam;  Vanuatu;  Virg in Islands of USA;  Wa llis and Futuna Islands;  
Yemen;  Zambia;  and Zimbabwe. 
 G/SG/N/8/TUR/7 
G/SG/N/10/TUR/7 G/SG/N/11/TUR/7/Suppl.1 
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  V. PROPOSED DATE OF INTRODUCTION OF THE MEASURE 
The date of introduction of the proposed me asure is 2 March 2007.  Application of the 
measure is pending approval of the Council of Ministers. 
VI. EXPECTED DURATION OF THE MEASURE 
The expected duration of the proposed measure is 3 years including the period of provisional 
measure. 
VII. PROPOSED DATE FOR THE REVIEW 
 Not applicable. 
 
VIII.  EXPECTED TIMETABLE FOR PROGRESSIVE LIBERALIZATION OF THE 
MEASURE 
In order to induce adjustment, the proposed m easure will be subject to liberalization on a 
regular basis following its imposition, thereby ensuri ng that there is a strong incentive for domestic 
producers to undertake progressively the necessary restructuring and adjustment.  The proposed 
measure is to be progressively libera lized as indicated in item IV above. 
IX. INFORMATION RELATING TO THE EXTENSION OF A SAFEGUARD MEASURE 
 Not applicable. 
 
__________