WORLD TRADE  
ORGANIZATION   
G/SG/N/11/TUR/17/Suppl.1 
G/SG/N/14/TUR/7 
2 February 2012 
 (12-0642) 
Committee on Safeguards Original:   English 
 
 
 
NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2  
OF THE AGREEMENT ON SAFEGUARDS 
 
NOTIFICATION UNDER ARTICLE 12.1 OF THE AGREEMENT  
ON SAFEGUARDS ON INITIATION OF AN INVESTIGATION  
(EXTENSION OF THE EXISTING MEASURE) AND THE REASONS FOR IT 
 
TURKEY 
 
(Cotton Yarn) 
 
 
 The following communication, dated 30 January 2 012, is being circulated at the request of the 
Delegation of Turkey.    
_______________ 
 
  We enclose a notification pursuant to Article  12.1(c) and Article 9, footnote 2 of the 
Agreement on Safeguards, on taking a decision to ex tend a safeguard measure that is being applied 
against imports of cotton yarn and non-application of safeguard measure  to developing countries.  The 
introduction of the initial safegua rd measure was notified with the document G/SG/N/8/TUR/11, 
G/SG/N/9/TUR/5, G/SG/N/10/TUR/11, G/SG /N/11/TUR/12, dated 22 August 2008.   
 
A. N
OTIFICATION UNDER ARTICLE 12.1(C)  OF THE AGREEMENT ON SAFEGUARDS UPON TAKING 
A DECISION TO EXTEND A SAFEGUARD MEASURE  
1. Evidence that the safeguard measure continue s to be necessary to prevent or remedy 
serious injury or threat thereof caused by  increased imports and that the industry 
concerned is adjusting. 
 The investigation has been conducted by Turk ish investigating authorities.  The figures 
between 2008 and 2011 were examined.  Followi ng figures on economic indicators of domestic 
producers are based on the data submitted by 59 domestic producers which produce 50% of total 
domestic production. 
 (i) Consumption 
 
Domestic 
consumption Unit 2008 2009 2010 2011 
tons 441,660 434,325 519,295 431,572 
 
 During the investigation period, consumpti on declined except for the increase in 2010.  
Accordingly, consumption declined to 431,572 tons in 2011 from 519,295 tons in 2010.   G/SG/N/11/TUR/17/Suppl.1 
G/SG/N/14/TUR/7 
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   On the other hand, total cotton yarn producti on is also calculated based on the total cotton 
consumption.  According to the calculation, total cotton yarn consumption is as follows. 
 
Domestic 
consumption Unit 2008 2009 2010 2011 
tons 997,205 776,584 1,016,073 910,456 
 
(ii) Market Share 
 
Market share Unit 2008 2009 2010 2011 
Market share of  
domestic industry % 71 78 71 78 
Market share of  
Imports % 29 22 29 22 
 
 After the imposition of the safeguard measure in 2008, domestic industry expanded its market 
share from 71% in 2008 to 78% in 2009.  After the decrease to 71% in 2010, market share of 
domestic industry reached again to  the level of 78% in 2011. 
 
 On the other hand, total cotton yarn producti on is also calculated based on the total cotton 
consumption.  According to the calculation, total cotton yarn consumption is as follows. 
 
Market share Unit 2008 2009 2010 2011 
Market share of  
domestic industry % 87 88 85 89 
Market share of  
Imports % 13 12 15 11 
 
(iii) Production 
 
Domestic production Unit 2008 2009 2010 2011 
tons 437,589 435,495 504,703 447,920 
 
 Domestic production was stable in 2008 and 200 9.  It increased 15.9% in 2010 to 504,703 
tons from 435,495 tons in 2009.  However it decr eased 11.2% to 447,920 tons in 2011, but it 
remained at a higher level compared to the level of production in 2009. 
 (iv) Capacity 
 
  Unit 2008 2009 2010 2011 
Capacity tons 501,034 534,189 551,738 551,894 
Capacity Utilization % 87 82 91 81 
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   Capacity of domestic industry increased steadily  during the investigation period.  It increased 
from 501,034 tons in 2008 to 551,894 tons in 2 011.  Although the annual capacity utilization rate 
pursued a fluctuating path over the years under in vestigation, it decreased from the level of 91% 
in 2010 to the level of 81% in 2011.   
 
(v) Domestic Sales 
 
Domestic sales Unit 2008 2009 2010 2011 
tons 312,663 339,739 370,042 334,744 
 
 Domestic sales of domestic industry followed a fluctuating course during the investigation 
period.  It increased from 312,663 tons in 2008 to 339,739 tons in 2009, and then to 370,042 in 2010.  However, domestic sales dropped significantly to 334,744 tons in 2011. 
 
(vi) Exports  
Exports of domestic 
goods (from production) Unit 2008 2009 2010 2011 
tons 42,364 35,317 36,771 38,115 
 
 Export sales of domestic industry had a fluc tuating trend between 2008 and 2011.  While 
export sales decreased to 35,317 tons in 2009 from 42,364 tons in 2008, it steadily increased to 
36,771 tons in 2010, and then to 38,115 tons in 2011.  
 (vii) Employment 
 
Employment Unit 2008 2009 2010 2011 
Number of direct 
workers 18,168 18,123 20,169 21,471 
 
 Total number of direct workers employed in the production of cotton yarn increased from 
18,168 in 2008 to 20,169 in 2010.  Number of direct workers in the domestic industry reached 
to 21,471 in 2011. 
 (viii) Productivity 
 
Productivity Unit 2008 2009 2010 2011 
tons per worker 24 24 25 21 
 
 During the investigation period, employme nt productivity of domestic industry ranged 
between the levels of 21 and 25 tons.  It decrea sed from 25 tons in 2010 to 21 tons in 2011. 
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  (ix) End of Period Inventories 
 
End of period 
inventories Unit 2008 2009 2010 2011 
Tons 95,190 76,294 84,882 67,631 
 
 End of period inventories of domestic indus try followed a fluctuating course during the 
investigation period.  It decreased from 84,882 tons in 2010 to 67,631 tons in 2011.  
 
(x) Profitability  
Profitability Unit 2008 2009 2010 2011 
% -5 2 7 2 
 
 Profitability figures of domestic producers fluc tuated during the period of investigation.  
Compared to the profit rate of 2008 (-5%) profitab ility increased to 2% in 20 11.  However, compared 
to the profit rate of 2010 (7%), profit rate decreased in 2011.  
 (xi) Conclusion 
 
 Within the scope of the WTO Agreement on Safeguards and Turkish Legislation on Safeguards, a safeguard measure may be extended provided that the competent authorities of the 
importing Member have determined that the safegua rd measure continues to be necessary to prevent 
or remedy serious injury and that there is  evidence that the industry is adjusting. 
  
 In this context, relying both on the data subm itted by domestic producers and from Chambers 
of Industry as well as from Chambers of Commerce a nd Industry which coordinated the application 
for the extension of the safeguard measure in force, and on determinations made during the 
investigation, regarding the developments in domest ic industry since the imposition of the safeguard 
measure in 2008, following facts are determined. 
 
 Domestic producers improved product quality and variety through research and product development studies, while at the same time foundi ng laboratories in order to set quality-control 
mechanisms.  Domestic producers have also made some replacement investments. 
  New compact-facilities concentrating on ring and combed cotton yarn production systems 
which require technological novelties have been established. 
  Through the improvement efforts on production processes as well as on employee training, 
some advancements and recoveries were provide d for reducing of labor and energy costs.  
Additionally, through new procedures on sales polic ies as well as on raw material purchasing policies, 
both raw material efficiency and quality efficiency we re improved.  Related to  this, cost of carrying 
inventories has decreased through the efforts on production planning based on continuous market 
need.  
After the imposition of the safeguard measure in 2008, companies which have-even partially-
accomplished economies of scale, have begun to atte nd fairs within the context of expanding their 
marketing networks and improving their works on foreign market surveys. 
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   Whereas the imposition of safeguard measure in 2008 some cotton yarn companies were 
closed down, after the measure no su ch information has been received. 
 
 It is clear that after the imposition of the safeguard measure on imports of cotton yarn, 
domestic industry has begun to adjust itself to the market conditions.  However the adverse effects of 
the global crisis of 2009 and the instability of world cotton market have advers ely affected adjustment 
efforts of the domestic producers and alleviated the ef fects of the safeguard measure imposed in 2008.  
 
 While cotton and cotton yarn prices have b een unstable, imports and domestic production 
slightly decreased in 2011 compared to 2010.  
 Economic uncertainty in Turkish main export markets has a considerable effect on Turkish 
textile and apparel exporters.  Ta king into account the negative exp ectation on exports to mentioned 
markets, the adjustment efforts of domestic cotton yarn producers may be adversely affected from this 
instability in case of non-extension of the safeguard measure. 
  During the implementation period of the safeguard measure, replacement investments by 
domestic industry on machinery and investments on production of cotton yarn for specific purposes 
could be realised only after the adverse effects of the global crisis moderated.  Through the 
accomplishment of economies of scale, cost-cutting e ffect of these investments and improvement of 
competitiveness on highly demanded products will ta ke effects only in the upcoming years. 
  In light of these determinations, in an uncertain and ambiguous  business environment 
because of the significant range of price fluctuatio n and instability in export markets, in order to 
maintain the efforts sustained by the domestic industry to adjust itself to the market conditions and 
preserve the positive developments realized by mean s of the safeguard measure and to mitigate the 
negative effects of these uncertainties in the global markets and to proceed the adjustment efforts by 
domestic industry, it has been determined that exte nsion of the safeguard measure is essential.  Taking 
into account the adjustment efforts, and ameliora tion of certain indicators of domestic industry and 
improvement of competitiveness in the domestic industr y it has been also determ ined that the measure 
can be applied at lower levels compared to the level of initial safeguard measure. 
 
2. Information on absolute increase in imports 
Imports Unit 2008 2009 2010 2011 
tons 128,997 94,586 149,253 96,828 
 
 After the imposition of the measure in 2008, im ports declined to 94,586 tons in 2009, then, 
suddenly increased to 149,253 tons in 2010.  Im ports of the product under investigation then 
decreased to 96,828 in 2011. 
 
3. Precise description of the product involved 
 The product subject to the proposed safeguard measure is cotton yarn (other than sewing).  
The product concerned is currently classified under th e code 52.05 within the Turkish Customs Tariff 
Schedule. 
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  4. Description of any part of the imported pr oduct that will no longer be subject to the 
measure in the extension 
 The initial safeguard measure covers the produc ts classified under the code 52.05 within the 
Turkish Customs Tariff Schedule.  For the extension no product is excluded. 
 5. Precise description of the proposed measure 
 In imports of cotton yarn described at Title 3 above, the safeguard measure is proposed to be 
extended for 3 years until 14 July 2014 (July 14 is in cluded) in the form of ad-valorem duty with 
minimum and maximum thresholds.  The amount of th e ad-valorem duty is proposed to be 10% (with 
a maximum amount of 0.85 Dollars per net kilogram  and with a minimum amount of 0.29 Dollars per 
net kilogram) in the first year until 14 July 2012 (July 14 is included).  
 
6. Proposed date of introduction of the measure 
 Council of Ministers' Decree No. 2012/2 721 was published on Official Gazette dated 
28 January 2012. 
 
7. Expected duration of the measure 
 The expected duration of the proposed measure is three years.   
 
8. Proposed date for the review  
 Not applicable.   
 
9. Expected timetable for progressive liberalization of the measure 
The measure is proposed to be liberalized as stated below: 
HS Code Duty Rates 
15/07/2011-14/07/2012 15/07/2012-14/07/2013  15/07/2013-14/07/2014  
52.05 10% 
Max. 0.85 USD/Net Kg 
Min. 0.29 USD/Net Kg 9% 
Max. 0.80 USD/Net Kg 
Min. 0.26 USD/Net Kg 8% 
Max. 0.75 USD/Net Kg 
Min. 0.23 USD/Net Kg 
 
10. If the notification relates only to a finding of serious injury or threat thereof, and does 
not relate to a decision to apply or extend a safeguard measure 
 Not applicable.   
 11. Information relating to the extension of a safeguard measure 
(i) Evidence that the industry  concerned is adjusting and that the safeguard measure continues to 
be necessary to prevent or remedy serious injury is provided in Title 1.   G/SG/N/11/TUR/17/Suppl.1 
 G/SG/N/14/TUR/7 
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  (ii) Reference to the WTO document that notifie d the initial application of the measure 
 The introduction of the definitive safeguard measure was notified in the document numbered 
G/SG/N/8/TUR/11, G/SG/N/9/TUR/5, G/SG /N/10/TUR/11, G/SG/N/11/TUR/12, dated 
22 August 2008.   
 
(iii) Duration of the measure from initial applicati on till the date at which it will be extended. 
 The initial safeguard measure was applied from 15 July 2008 to 14 July 2011.  Turkey now 
intends to extend the safeguard  measure until 14 July 2014. 
 
(iv) Precise description of the measure in place prior to the date of extension 
The initial safeguard measure, an ad-valorem  duty of 15% for the products classified under 
HS codes of 5205.12, 5205.22, 5205.32 and 5205.42, and an ad-valorem duty of 20% for the rest of 
the products under HS code 52.05 was put into force in imports of cotton yarn described in Title 3 
above by the Council of Ministers decision published in the Official Gazette dated 21 October 2008.  
The measure has been liberalized 1% every year .  Following table illustrates the initial safeguard 
measure imposed in the form of ad-valorem duty with minimum and maximum thresholds. 
HS Code Duty Rates 
15/07/2008-14/07/2009 15/07/2009-14/07/2010  15/07/2010-14/07/2011  
52.05 
(except for 5205.12; 
5205.22; 
5205.32; 
5205.42) 20% 
Max. 1.00 USD/Net Kg 
Min. 0.35 USD/Net Kg 19% 
Max. 0.95 USD/Net Kg 
Min.0.33 USD/Net Kg 18% 
Max. 0.90 USD/Net Kg 
Min. 0.31 USD/Net Kg 
5205.12 
5205.22 
5205.32 
5205.42 15% 
Max. 1.00 USD/Net Kg 
Min. 0.35 USD/Net Kg 14% 
Max. 0.95 USD/Net Kg 
Min. 0.33 USD/Net Kg 13% 
Max. 0.90 USD/Net Kg 
Min. 0.31 USD/Net Kg 
 
12. Information relating to exporting members 
(i) The major exporting Members of imports of the product involved. 
The main exporter country to Turkey for the pr oduct concerned is Uzbekistan.  Uzbekistan 
has more than 23 per cent import share in 2010.    
(ii) There are no exporting Members to which th e measure does not apply for any reason other 
than the application of Article 9.1 
13. Members are encouraged to attach, in an electronic form, publicly available 
document(s) containing the relevant decision (s) made by the competent authority.   
The official documents regarding the investiga tion and the final decision can be reached from 
the link below.   
 http://www.tpsa.gov.tr/index.cfm?sayfa =2D66D34A-D8D3- 8566-45206064A27661E4  
 G/SG/N/11/TUR/17/Suppl.1 
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  B. N
OTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2 OF THE AGREEMENT ON SAFEGUARDS  
1. The measure 
 It is proposed to impose safeguard measure in  the form of ad-valorem duty with minimum 
and maximum thresholds as described in Title 5. 
 2. The product subject to the measure 
 The measure is applied to the products  described in Title 3, stated above. 
 3. Developing countries to which the measure is not applied under article 9.1 of the 
Agreement on Safeguards. 
 The developing countries which are excluded from the measure as they export less than 
3 per cent of imports to Turkey are listed below.   
 Afghanistan;  Albania;  Algeria;  Antigua and Ba rbuda;  Angola;  Argentina;  American Samoa;  
Anguilla;  Antarctica;  Aruba;  Azerbaijan;  Barbados;  Bangladesh;  Burkina Faso;  
Bahrain, Kingdom of;  Burundi;  Benin;  Bolivari an Republic of Venezuela;  Brunei Darussalam;  
Bolivia, Plurinational State of;  Brazil;  Bahama s;  Bhutan;  Botswana;  Belize;  Bermuda;  
Bouvet Island;  British Virgin Islands;  Br itish Indian Ocean Territory;  Cambodia; 
Democratic Republic of Congo;  Cent ral African Republic;  Congo;  Cô te d'Ivoire;  Cameroon;  Chad;  
Colombia;  Comoros;  Costa Rica;  Cuba;  Cape Verd e;  Cayman Islands;  Chile;  Christmas Islands;  
Cocos Islands;  Cook Islands;  Djibouti;  Dominica;  Dominican Republic;  Ecuador;  Egypt;  Eritrea;  
Ethiopia;  Fiji;  Federated States of Micronesi a;  Falkland Islands;  French Polynesia;  
French Southern Territories;  Gabon;  Grenada;  Gh ana;  Gambia;  Georgia;   Greenland;  Guinea;  
Equatorial Guinea;  Guatemala;  Guinea-Bissau;  Guyana;  Gibraltar;  Guam;  Honduras;  Haiti;  
Heard Island and McDonald Islands;  Indonesia;  Iraq;  Iran (Islamic Republic of);  Jamaica;  Jordan;  
Kazakhstan;  Kenya;  Kiribati;  St. Kitts and Nevis;   Kingdom of Saudi Arabia;  Kuwait;  Kyrgyzstan;  
Laos;  Lebanon;  St. Lucia;  Sri Lanka;  Liberia;  Lesotho;  Libyan Arab Jamahiriya;  Morocco;  Madagascar;  Marshall Islands;  Mali;  Moldova;  Mongolia;  Maurita nia;  Mauritius;  Malaysia;  
Maldives;  Malawi;  Mozambique;  Macao;  Mayotte;  Mexico;  Montserrat;  Namibia;  Niger;  
Nigeria;  Nicaragua;  Nepal;  Nauru;  Netherlands  Antilles;  New Caledonia;  Niue Island;  Norfolk 
Island;  Northern Mariana Islands;  Oman;  Panama;  Peru;  Papua New Guinea;  Philippines;  Palau;  
Paraguay;  Pitcairn;  Qatar;  Russian Federation;  Rwanda;  Samoa;  Solomon Islands;  Seychelles;  
Sudan;  Sierra Leone;  Senegal;  Somalia;  S outh African Republic;  Suriname;  Sao Tomé and 
Principe;  El Salvador;  Swaziland;  South Geor gia and South Sandwich Is lands;  St. Helena and 
dependencies;  St. Pierre and Miquel on;  Tajikistan;  Thailand;  Togo;  Tunisia;  Tonga;  East Timor;  
Trinidad and Tobago;  Tuvalu;  Tanzania;  Toke lau;  Turks and Caicos Islands;  Ukraine;  
United Arab Emirates;  United States Minor outlyi ng islands;  Uganda;  Uruguay;  St. Vincent;  
Vanuatu;  Viet Nam;  Virgin Islands of USA;  Wallis and Futuna Islands ;  Yemen;  Zambia and 
Zimbabwe.  
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