Commission staff working document - Turkey - 2008 progress report accompanying the Communication from the Commission to the European Parliament and the Council - Enlargement strategy and main challenges 2008-2009 {COM(2008) 674}
Date: 2008-11-05
Institutions: European Commission
Subjects: Türkiye, accession to the European Union, enlargement of the Union, pre-accession strategy, report

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 5.11.2008 
SEC(2008) 2699 

COMMISSION STAFF WORKING DOCUMENT 

TURKEY 2008 PROGRESS REPORT 

accompanying the 

COMMUNICATION FROM THE COMMISSION 
TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 

Enlargement Strategy and Main Challenges 2008-2009 

{COM(2008) 674} 

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TABLE OF CONTENTS 

1. 

1.1. 

1.2. 

1.3. 

2. 

2.1. 

2.2. 

2.3. 

3. 

3.1. 

3.2. 

4. 

4.1. 

4.2. 

4.3. 

4.4. 

4.5. 

4.6. 

4.7. 

4.8. 

4.9. 

Introduction .................................................................................................................. 4 

Preface.......................................................................................................................... 4 

Context ......................................................................................................................... 4 

Relations between the EU and Turkey......................................................................... 4 

Political criteria ............................................................................................................ 6 

Democracy and the rule of law .................................................................................... 6 

Human rights and the protection of minorities .......................................................... 11 

Regional issues and international obligations ............................................................ 28 

Economic criteria ....................................................................................................... 29 

The existence of a functioning market economy ....................................................... 29 

The capacity to cope with competitive pressure and market forces within the Union
.................................................................................................................................... 34 

Ability to assume the obligations of membership...................................................... 36 

Chapter 1: Free movement of goods .......................................................................... 37 

Chapter 2: Freedom of movement for workers .......................................................... 39 

Chapter 3: Right of establishment and freedom to provide services ......................... 40 

Chapter 4: Free movement of capital ......................................................................... 41 

Chapter 5: Public procurement................................................................................... 43 

Chapter 6: Company law............................................................................................ 44 

Chapter 7: Intellectual property law........................................................................... 45 

Chapter 8: Competition policy ................................................................................... 46 

Chapter 9: Financial services ..................................................................................... 48 

4.10.  Chapter 10: Information society and media ............................................................... 50 

4.11.  Chapter 11: Agriculture.............................................................................................. 51 

4.12.  Chapter 12: Food safety, veterinary and phytosanitary policy .................................. 52 

4.13.  Chapter 13: Fisheries.................................................................................................. 54 

4.14.  Chapter 14: Transport policy ..................................................................................... 55 

4.15.  Chapter 15: Energy .................................................................................................... 56 

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4.16.  Chapter 16: Taxation.................................................................................................. 58 

4.17.  Chapter 17: Economic and monetary policy.............................................................. 59 

4.18.  Chapter 18: Statistics.................................................................................................. 59 

4.19.  Chapter 19: Social policy and employment ............................................................... 60 

4.20.  Chapter 20: Enterprise and industrial policy.............................................................. 63 

4.21.  Chapter 21: Trans-European networks....................................................................... 64 

4.22.  Chapter 22: Regional policy and coordination of structural instruments .................. 64 

4.23.  Chapter 23: Judiciary and fundamental rights ........................................................... 66 

4.24.  Chapter 24: Justice, freedom and security ................................................................. 71 

4.25.  Chapter 25: Science and research .............................................................................. 75 

4.26.  Chapter 26: Education and culture............................................................................. 76 

4.27.  Chapter 27: Environment ........................................................................................... 76 

4.28.  Chapter 28: Consumer and health protection............................................................. 78 

4.29.  Chapter 29: Customs union........................................................................................ 79 

4.30.  Chapter 30: External relations.................................................................................... 80 

4.31.  Chapter 31: Foreign, security and defence policy...................................................... 81 

4.32.  Chapter 32: Financial control..................................................................................... 84 

4.33.  Chapter 33: Financial and budgetary provisions........................................................ 85 

STATISTICAL ANNEX 

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COMMISSION STAFF WORKING DOCUMENT 

TURKEY 2008 PROGRESS REPORT 

1. 

INTRODUCTION 

1.1. 

Preface 

Following  the  conclusions  of  the  Luxembourg  European  Council  in  December  1997,  the 
Commission has reported regularly to the Council and the Parliament. 

This report on progress made by Turkey in preparing for EU membership largely follows the 
same structure as in previous years. The report: 

–  briefly describes the relations between Turkey and the Union; 
–  analyses the situation in Turkey in terms of the political criteria for membership; 
–  analyses the situation in Turkey on the basis of the economic criteria for membership; 
–  reviews  Turkey's  capacity  to  assume  the  obligations  of  membership,  that  is,  the  acquis 

expressed in the Treaties, the secondary legislation, and the policies of the Union. 

The period covered by this report is from 1 October 2007 to early October 2008. Progress is 
measured on the basis of decisions taken, legislation adopted and measures implemented. As a 
rule, legislation or measures which are under preparation or awaiting Parliamentary approval 
have not been taken into account. This approach ensures equal treatment across all reports and 
permits an objective assessment. 

The  report  is  based  on  information  gathered  and  analysed  by  the  Commission.  In  addition, 
many  sources  have  been  used,  including  contributions  from  the  government  of  Turkey,  the 
Member States, European Parliament reports1, and information from various international and 
non-governmental organisations. 

The Commission draws detailed conclusions regarding Turkey in its separate communication 
on enlargement2, based on the technical analysis contained in this report. 

1.2. 

Context 

The Helsinki European Council of December 1999 granted the status of candidate country to 
Turkey. Accession negotiations with Turkey were opened in October 2005. 

The  Association  Agreement  between  Turkey  and  the  then  EEC  was  signed  in  1963  and 
entered in force in December 1964. Turkey and the EU formed a customs union in 1995. 

1.3. 

Relations between the EU and Turkey 

Accession  negotiations with  Turkey  continued.  During  the  preparatory  analytical  phase  the 
level  of  preparedness  to  start  negotiations  on  individual  chapters  has  been  assessed  on  the 

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2 

The rapporteur for Turkey was Ms Oomen Ruijten. 
Enlargement Strategy and Main Challenges 2008-2009. 

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basis of screening reports. Of a total of 33 screening reports, one has still to be delivered by 
the Commission to the Council whilst nine are being discussed in the Council. 

So far, negotiations have been opened on eight chapters (Enterprise and industry, Statistics, 
Financial  Control,  Trans-European  Networks,  Consumer  and  health  protection,  Intellectual 
property law, Company law) one of which (science and research) was provisionally closed. In 
addition, the EU informed Turkey about the progress needed to reach a satisfactory level of 
preparedness to start negotiations on eleven chapters. The December 2006 Council decision3 
remains in force. 

The  enhanced  political  dialogue  between  the  EU  and  Turkey  has  continued.  Political 
dialogue meetings were held in May and September 2008 at ministerial level and in February 
and July 2008 at political director level. These meetings focused on the main challenges faced 
by  Turkey  in  terms  of  the  Copenhagen  political  criteria  and  reviewed  progress  being  made 
towards  fulfilment  of  Accession  Partnership  priorities.  Foreign  policy  issues  related  to 
regional areas of common interest to the EU and Turkey, such as Iraq, Iran, the Middle East 
and the Caucasus, were also regularly discussed. 

The EC-Turkey customs union contributed to a further increase in bilateral EU-Turkey trade, 
which  was  nearly  €  100  billion  in  2006,  thereby  making  Turkey  the  EU's  seventh  trading 
partner. The EU asked Turkey to remove all remaining restrictions on the free movement of 
goods, including restrictions on means of transport regarding Cyprus. A number of Turkey’s 
commitments  on  technical  barriers  to  trade,  import  licences,  State  aid  and  enforcement  of 
intellectual  property  rights  remain  unfulfilled.  No  progress  can  be  reported  concerning 
Turkey's longstanding ban on imports of live bovine animals, beef and other animal products. 

The  EU  provides  guidance  to  the  authorities  on  reform  priorities  through  the  Accession 
Partnership. The Council adopted a revised version of the Accession Partnership in February 
2008. Progress on these reform priorities is encouraged and monitored through the bodies set 
up  under  the  Association  Agreement.  The  Association  Committee  met  in  March  2008,  the 
Association  Council  in  May  2008.  Eight  sectoral  sub-committees  have  been  held  since 
November 2006. 

Turkey  has  not  pursued  the  negotiations  on  a  readmission  agreement  with  the  European 
Community since December 2006. 

As regards financial assistance, some € 540 million  have been earmarked  for Turkey  from 
the  Instrument  for  Pre-accession  Assistance  (IPA)  in  2008.  The  Multi-Annual  Indicative 
Planning Document 2008-2010, which provides the strategic multi-annual framework for all 
programmes at national level, was adopted by the Commission on 25 July 2008. In addition, 
Turkey is benefiting from a series of regional and horizontal programmes under IPA. 

In relation to IPA preparations, Turkey's focus in the last year has been on finalisation of the 
first  set  of  programmes  under  all  components,  the  negotiation  of  a  Framework  Agreement 
with the Commission and preparations for the setting up of implementation systems. Delays 
have occurred in these preparations, which put some of the IPA 2007 programme allocations 

3 

The  decision  sets  out  that  negotiations  will  not  be  opened  on  eight  chapters  relevant  to  Turkey's 
restrictions  regarding  the  Republic  of  Cyprus  and  no  chapter  will  be  provisionally  closed  until  the 
Commission  confirms  that  Turkey  has  fully  implemented  the  Additional  Protocol  to  the  Association 
Agreement. 

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at  risk.  Turkey  needs  to  vigorously  address  remaining  system  weakness  findings  and  to 
further improve the quality and efficiency of the project and programme cycles. 

2. 

POLITICAL CRITERIA 

This  section  examines  progress  made  by  Turkey  towards  meeting  the  Copenhagen  political 
criteria, which require stability of institutions guaranteeing democracy, the rule of law, human 
rights  and  respect  for  and  protection  of  minorities.  It  also  monitors  the  respect  for 
international  obligations,  regional  cooperation,  and  good  neighbourly  relations  with 
enlargement countries and Member States. 

2.1. 

Democracy and the rule of law 

On  14  March  2008  the  Chief  Public  Prosecutor  applied  to  the  Constitutional  Court  for  the 
governing AK party to be dissolved and for 71 former and present party officials, including 
the President of the Republic and the Prime Minister, to be banned from being member of a 
political party for five years. The charges brought against the party alleged that it was a focal 
point for anti-secular activities. On 30 July, the Constitutional Court fell short of the required 
majority  to  close  down  the  party,  but  considered  that  the  latter  had  carried  out  activities 
against  the  secular  principles  of  the  Republic.  It  thus  ordered  that  50%  of  the  government 
funds due in 2008 be cut off. (See also section on freedom of association). 

Pursuant to Articles 68 and 69 of the Constitution and to the relevant provisions of the Law on 
political parties, on 16 November 2007 the Chief Public Prosecutor at the Court of Cassation 
applied  to  the  Constitutional  Court  for  closure  of  the  Democratic  Society  Party  (DTP).  He 
also  requested  that  221  former  and  present  members  of  the  party  be  banned  from  being 
member  of  a  political  party  for  five  years.  The  party  is  accused  of  engaging  in  activities 
against the unity and integrity of the country. This case is pending before the Constitutional 
Court. 

An investigation started in 2007 into an allegedly criminal network, known as Ergenekon, led 
to the arrest of a number of people, including retired Army generals. The indictment against 
Ergenekon, presented on 14 July 2008 by the Istanbul Public Prosecutor Office, is based on 
charges such as forming a terrorist organisation and attempting to overthrow the government 
and  to  undermine  its  operation  by  use  of  violent  means.  During  the  course  of  the 
investigation,  there  were  reports  regarding  the  insufficient  safeguarding  of  the  rights  of 
defence and the excessive duration of detention period without indictment. The first hearing 
of the trial, first of this kind on such a scale, was held as planned on 20 October.  

Constitution 

The  governing  party  gave  a  group  of  academics  a  mandate  to  revise  the  1982  Constitution 
with  a  view,  among  other  things,  to  aligning  Turkey  with  international  standards  on 
fundamental rights. 

However,  no  draft  has  been  presented  either  to  the  public  or  to  parliament,  and  no  clear 
timetable has been set for discussing it.  

Instead, in February 2008, the Parliament amended Article 10 ("Equality before the law") and 
Article 42 ("Right and duty of training and education") of the Constitution, with the aim of 
lifting  the  headscarf  ban  for  university  students.  The  amendments  were  adopted  with  the 

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support  of  the  governing  Justice  and  Development  Party  (AKP)  and  of  the  opposition 
Nationalist Movement Party (MHP) and Democratic Society Party (DTP).  

Following an appeal by the opposition Republican People's Party (CHP) and Democratic Left 
Party  (DSP),  on  5  June  2008  the  Constitutional  Court  annulled  the  amendments  on  the 
grounds  that  they  were  against  the  secular  nature  of  the  State.  A  minority  of  two  judges 
argued that the Court can only examine constitutional amendments with regard to their form 
and not their content. 

Parliament 

The  Parliament  -  the  Turkish  Grand  National  Assembly  -  adopted  116  bills.  Since  October 
2007  the  government  submitted  397  draft  bills,  while  313  were  submitted  by  individual 
members of Parliament. 

In  March  2008  an  amendment  to  the  Law  on  elections  and  electoral  rolls  was  adopted, 
extending the right of Turkish citizens living abroad to participate in parliamentary elections, 
in line with the recommendations of the OSCE Election Monitoring Report. 

However, in response to an appeal filed by the CHP, the Constitutional Court ruled in May 
that the possibility of postal voting is unconstitutional. The CHP referred to the Constitutional 
Court  a  total  of  16  laws  adopted  in  2008,  some  of  which  were  intended  to  introduce  EU-
related  democratisation  reforms  (including,  for  example,  the  law  on  Foundations  and  the 
amendments to the Law on the public service broadcaster). 

President 

The new President has exerted efforts to play a conciliatory role with regard to political actors 
and  civil  society.  He  established  a  good  working  relationship  with  the  government,  while 
repeatedly calling for an acceleration of the pace of EU-related reforms.  

He  played  an  active  role  in  foreign  policy  and  travelled  extensively  abroad.  In  September 
2008,  at  the  invitation  of  the  Armenian  President,  he  paid  the  first-ever  visit  by  a  Turkish 
President  to  Armenia,  with  a  view  to  establishing  a  bilateral  dialogue  leading  to  the 
normalisation of bilateral relations.  

Government  

The  government  expressed  its  commitment  to  the  EU  accession  process  and  to  political 
reforms.  

However, despite its strong political mandate, the government did not put forward a consistent 
and  comprehensive  programme  of  political  reforms.  On  1  September  2008  the  Government 
announced  a  draft  National  Programme  for  the  Adoption  of  the  Acquis,  and  started  a 
consultation  process  with  civil  society  and  the  opposition.  The  Programme  remains  to  be 
adopted. The staff and resources of the Secretariat General for EU Affairs (EUSG), the main 
coordinating body in charge of EU affairs, remain weak.  

As  regards  local  government,  Parliament  adopted  a  Law  on  municipalities  in  March  2008. 
This  Law  established  43  new  districts,  merged  239  municipalities  and  closed  down  863  of 
them. In July 2008, Parliament adopted a Law to increase the revenue of local Governments, 

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aimed at enabling them to fulfil their mandate more effectively. The implementation of local 
administration laws and capacity-building has continued.  

However,  the  Law  on  municipalities  adopted  in  March  2008  is  still  under  review  in  the 
Constitutional Court, following the appeal by the CHP. There has been no progress regarding 
the adoption of the Framework Law on public administration, which aimed at devolving more 
powers to local Government. 

City councils, which are designed to be a platform to enhance citizens' participation in local 
government, have been functioning effectively in only a limited number of cities. Efforts are 
needed to strengthen all city councils. Accountability systems and transparency also need to 
be strengthened.  

Overall, as concerns the legislative and executive functions, while the new President played a 
positive  role  by  calling  for  further  political  reforms,  the  government  did  not  put  forward  a 
consistent  and  comprehensive  programme  of  political  and  constitutional 
reforms. 
Furthermore, the lack of dialogue and spirit of compromise between the main political parties 
had a negative impact on the smooth functioning of the political institutions. The work of the 
newly  elected  parliament  was  affected  to  a  considerable  extent  by  legal  cases  aimed  at 
dissolution  of  two  parties.  As  regards  local  government,  the  recently  adopted  local 
administration laws need to be implemented and decentralisation of powers in favour of local 
governments to be strengthened.  

Public administration  

As  part  of  the  efforts  to  reduce  red  tape,  the  government  issued  a  circular  in  May  2008 
instructing  all  public  agencies  to  use  the  ID  shared  data  base  (KPS)  for  residence  and  birth 
records  of  citizens,  instead  of  requesting  them  from  citizens.  The  current  recruitment  and 
promotion  procedure  (up  to  mid-career  level)  is  based  on  a  merit-based  competitive 
examination, managed by an autonomous body.  

However,  the  politicisation  of  senior  level  appointments  has  been  criticised.  As  regards  the 
reform of public administration, a number of issues remain to be addressed, such as reducing 
administrative  burden,  ensuring  simplification,  establishing  regulatory  impact  assessments 
(RIA), developing administrative procedures, enhancing transparency and improving policy-
making and coordination systems.  

Strategy  development  units,  which  are  pillars  of  financial  management  and  policy-making, 
need  to  be  strengthened.  Efforts  are  needed  to  secure  full  implementation  of  the  Public 
Financial Management and Control Law.  

Parliament has not received a comprehensive draft law on the Civil Service.  

Overall,  there  has  been  limited  progress  on  public  administration  reform.  The  civil  service 
system needs to be modernised.  

Civilian oversight of the security forces 

Political control over the military was applied in practice in the context of military operations 
aimed at terrorist targets in Northern Iraq. Such operations were authorised by the parliament 
and decided upon by the government.  

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However,  the  armed  forces  have  continued  to  exercise  significant  political  influence  via 
formal and informal mechanisms. Senior members of the armed forces have expressed their 
opinion on domestic and foreign policy issues going beyond their remit, including on Cyprus, 
the South East, secularism, political parties and other non-military developments.  

No change has been made to the Turkish Armed Forces Internal Service Law and the Law on 
the  National  Security  Council.  These  define  the  role  and  duties  of  the  Turkish  military  and 
grant  the  military  wide  room  for  manoeuvre  by  providing  a  broad  definition  of  national 
security.  No  progress  has  been  made  on  enhancing  civilian  control  over  the  Gendarmerie 
when engaged in law enforcement activities. 

An  internal  military  memorandum  leaked  to  the  press  identified  NGOs  that  had  received 
financial aid from foreign organisations, including the EU. The memorandum was not denied 
by the General Staff. 

The 1997 EMASYA secret protocol on security, public order and assistance units remains in 
force  unchanged.  The  protocol  allows  military  operations  to  be  carried  out  for  internal 
security matters under certain conditions without a request from the civilian authorities. 

No progress has been made on strengthening parliamentary oversight of the military budget 
and  expenditure.  The  Parliamentary  Planning  and  Budget  Committee  reviews  the  budget  of 
the  Ministry  of  National  Defence.  However,  extra-budgetary  funds  are  excluded  from 
parliamentary  scrutiny.  The  Defence  Industry  Support  Fund  (SSDF),  from  which  most 
procurement projects are funded, is still an extra-budgetary fund. 

As regards auditing, under the Constitution the Court of Auditors can carry out external ex-
post  audits  of  military  expenditure.  In  2007,  some  25%  of  all  military  accountancy  offices 
were audited. In July 2008, the Court of Auditors decided that it has a mandate to audit the 
SSDF. However, the Court remains unable to audit assets belonging to the military, pending 
adoption of the revised legislation on the Court of Auditors, which is overdue. Furthermore, 
the 2003 Law on public financial management and control, which provides for internal audits 
of security institutions, has yet to be properly implemented 

Overall,  no  progress  has  been  made  in  ensuring  full  civilian  supervisory  functions  over  the 
military  and  parliamentary  oversight  of  defence  expenditure.  Senior  members  of  the  armed 
forces have made statements on issues going beyond their remit.  

Judicial system 

The  Ministry  of  Justice  has  been  working  on  a  draft  judicial  reform  strategy,  which  it 
presented  in  spring  2008.  The  document  is  comprehensive  and  covers  issues  related  to  the 
independence,  impartiality,  efficiency  and  effectiveness  of  the  judiciary,  enhancement  of  its 
professionalism,  the  management  system  and  measures  to  enhance  confidence  in  the 
judiciary,  to  facilitate  access  to  justice  and  to  improve  the  penitentiary  system.  Judges  and 
prosecutors discussed the draft strategy at a meeting in Antalya.  

In 2007, a total of 846 judges and prosecutors were appointed. The total number of judges and 
prosecutors  on  1  May  2008  was  6,914  (6,785  on  1  May  2007)  and  3,917  (3,744  on  1  May 
2007)  respectively.  On  the  same  date,  the  total  number  of  vacant  posts  for  judges  and 
prosecutors  was  4,166.  The  funds  available  to  the  judiciary  in  2007  totalled  €  865  million. 
This  covers  salaries  and  social  security  payments  for  all  members  of  the  judiciary,  plus 
services and real estate acquisition for the judiciary. 

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However, there have been no developments on establishment of the regional courts of appeal. 
This is a matter of concern. Under the law, these should have been operational by June 2007. 
In addition, there is a need to strengthen efforts to ensure that interpretation by the judiciary of 
legislation related to human rights and fundamental freedoms is in line with the ECHR, with 
the case-law of ECtHR and with article 90 of the Turkish Constitution. 

Concerns remain about the impartiality of the judiciary. On some occasions senior members 
of the judiciary made public political comments which may compromise their impartiality in 
future cases. As regards independence, there has been no progress on the composition of the 
High Council of Judges and Prosecutors4 or on the reporting lines of judicial inspectors5 (See 
also Chapter 23 – Judiciary and fundamental rights). 

The Şemdinli case was transferred to the Van military court following a decision of the Court 
of Cassation6. The Van military court ordered the release – pending trial – of the accused.  

Other  high-profile  cases  underlined  the  importance  of  the  quality  of  the  investigation.  This 
pointed  to  the  need  to  improve  the  institutional  relationship  between,  on  the  one  hand,  the 
police and the gendarmerie and, on the other, the judiciary. 

Overall,  the  work  to  date  on  the  draft  judicial  reform  strategy  has  been  a  positive 
development. The Ministry of Justice needs to continue and expand the consultations with all 
stakeholders,  including  civil  society,  and  build  the  necessary broad  support  for  the  strategy. 
However,  concerns  remain  as  regards  the  independence  and  impartiality  of  the  judiciary.. 
Reforms in the area of the judiciary are a priority of the Accession Partnership. 

Anti-corruption policy  

Turkey has implemented one third of the recommendations made in GRECO's 2005 joint first 
and second round evaluation report. It has made efforts to ensure practical implementation of 
the  existing  anti-corruption  legislation,  inter  alia  by  enhancing  training  on  corruption 
detection  and  investigation  for  law  enforcement  officers,  establishing  guidelines  on  seizure 
and  confiscation  and  developing  systems  for  monitoring  the  impact  of  anti-corruption 
measures.  

However, the Government failed to prepare a comprehensive anti-corruption strategy. Policy 
making in this field has not received adequate political support. 

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The  composition  of  the  High  Council  is  not  representative  of  the  judiciary  as  a  whole:  only  senior 
members  of  the  judiciary  from  the  Court  of  Cassation  and  the  Council  of  State  are  members  of  this 
Council. 
The judicial inspectors, who are responsible for evaluating the performance of judges and prosecutors, 
are attached to the Ministry rather than to the High Council. 
This case concerns the bombing in November 2005 that killed one person and injured others in the town 
of Şemdinli in Southeast Turkey. The prosecutor on the case published the indictment in March 2006. 
The indictment included also accusations against high-ranking military commanders. The General Staff 
criticised  the  indictment  and  urged  those  bearing  constitutional  responsibility  to  take  action.  In  April 
2006, the High Council of Judges and Prosecutors dismissed from office the Şemdinli prosecutor. The 
disproportionate  character  of  this  decision  raised  questions  on  the  independence  of  the  High  Council 
form other state institutions. A first instance civil court sentenced the accused - two non-commissioned 
officers  and  a  PKK  informant  -  to  a  total  of  thirty-nine  (39)  years  of  imprisonment.  On  appeal,  the 
Court of Cassation ruled that the offences had not been properly constituted and that the case falls under 
the jurisdiction of the military court. 

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Furthermore, several of GRECO's most important recommendations have not been addressed, 
such  as  the  recommendation  to  entrust  an  oversight  body,  involving  civil  society,  with  the 
responsibility  of  overseeing  implementation  of  national  anti-corruption  strategies  and  of 
proposing new strategies. 

Corruption  incidents,  involving  in  particular  real  estate  agencies,  local  government  and 
universities,  were  frequently  reported  by  the  media.  As  a  result,  law  enforcement  agencies 
have  conducted  a  series  of  high-profile  corruption  investigations  in  various  agencies.  In  the 
context of a fraud case against the charity association Deniz Feneri in Germany, the Regional 
Court  of  Frankfurt  am  Main  convicted  three  charity’s  managers  for  having  misused  funds 
collected as donations. The Court also stated that part of the  funds have  been channelled to 
entities based in Turkey. In this context, an Ankara prosecutor initiated an investigation, and 
asked the Ministry of Justice to request the necessary documents from the German Court.  

There has been no progress on limiting the immunity of Members of Parliament and there is 
no legislation in place on election campaign financing. The European Court of Human Rights 
noted  in  a  ruling  that  that  no  objective  criteria  had  been  set  to  define  the  conditions  under 
which immunity could be lifted7.  

No  progress  has  been  made  regarding  new  legislation  on  the  Court  of  Auditors.  There  has 
been no progress on strengthening Parliamentary oversight over public expenditure. 

Overall, there has been limited progress in the area of anti-corruption. Corruption remains a 
widespread issue. There has been limited progress towards strengthening the legal framework 
and  institutional  set-up  to  fight  corruption.  The  continuing  absence  of  an  overall  strategy, 
action plan and coordination mechanism is a cause for continuing concern in this area. Turkey 
needs to develop a track record of investigations, prosecutions and indictments of allegations 
of corruption.  

(See also Chapter 23 – Judiciary and fundamental rights) 

2.2. 

Human rights and the protection of minorities 

Observance of international human rights law 

There have been no developments as regards ratification of human rights instruments. The 
Optional  Protocol  to  the  UN  Convention  against  Torture  (OPCAT),  signed  in  September 
2005, has not been ratified. The ratification of the UN Convention on the Rights of Persons 
with Disabilities is pending. Turkey has not ratified three additional Protocols to the European 
Convention on Human Rights (ECHR)8. 

During  the  reporting  period,  the  European  Court  of  Human  Rights  (ECtHR)  delivered  a 
total of 266 judgments finding that Turkey had violated the ECHR. Similarly to last year, the 
total number of new applications to the ECtHR continued to increase, with 3,705 applications 
during the reporting period. The majority of these new applications concerned the right to a 
fair trial and protection of property rights. Few of them concerned violations of the right to 
life or torture and ill-treatment. 

7 
8 

Kart v. Turkey (Application 8917/05). 
Protocols n° 4, n° 7 and n° 12. 

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Turkey  abided  by  the  final  judgment  of  the  ECtHR  in  the  majority  of  cases.  However,  a 
considerable  number  of  ECtHR  judgments  are  awaiting  enforcement  by  Turkey.  This  is 
sometimes because general legislative measures are required. For instance, the legal provision 
preventing  the  re-opening  of  domestic  proceedings  in  certain  circumstances  following  a 
judgment  by  the  ECtHR  remains  in  force.  The  Committee  of  Ministers  of  the  Council  of 
Europe indicated that continuation of this situation amounts to a manifest breach of Turkey's 
obligation under the ECHR. Furthermore, Turkey has not adopted legal measures to prevent 
repetitive prosecution and conviction of conscientious objectors. Other cases pending before 
the Committee of Ministers awaiting adoption of the necessary implementing measures relate 
to control of the activities of security forces, effective remedies against abuses and restrictions 
on freedom of expression. 

In the Cyprus v. Turkey case, the issue of missing persons and the restrictions on the property 
rights of Greek Cypriots living permanently in the northern part of Cyprus remain pending. 
The compensation mechanism put in place to address the property rights of displaced persons 
fulfils  in  principle  the  requirements  indicated  by  the  ECtHR  and  has  continued  to  receive 
requests  for  compensation.  On  22  April  2008  the  Court  welcomed  settlement  in  the  case  of 
Eugenia  Michaelidou  Developments  Ltd  and  Michael  Tymvios  v.  Turkey  brokered  by  the 
Turkish Cypriot Immovable Property Commission, which provides for the payment of USD 1 
million and a property exchange. However, the ECtHR has not assessed whether the available 
remedy is effective for all relevant issues. Turkey has not yet fully implemented the ECtHR 
judgements on the Loizidou and Xenides-Arestis cases. 

Overall,  Turkey  has  continued  to  make  progress  on  the  execution  of  ECtHR  judgments. 
However, further efforts are needed in this context. Furthermore, there has been no progress 
on ratification of international human rights instruments, including in particular OPCAT.  

Several State-sponsored bodies have the task of ensuring the promotion and enforcement of 
human rights. These include the Human Rights Presidency under the Prime Minister's office 
and  the  Human  Rights  Boards  (931  in  all).  The  latter  have  the  task  of  visiting  places  of 
detention and State-sponsored social services.  

At  parliament  level,  the  Human  Rights  Investigation  Committee  has  established  two  sub-
committees  to  investigate  torture  and  ill-treatment  in  prisons  and  detention  centres  and  the 
murder of journalist Hrant Dink. The latter Commission finalised its report in July 2008. The 
report came to the conclusion that there was negligence, error and lack of co-ordination in the 
activities of the security organisations and of the gendarmerie in failing to prevent the murder. 
These findings need to be properly followed-up. 

The institutional framework for human rights promotion and enforcement does not meet the 
independence requirement and lacks financial autonomy and transparency. There is a need for 
greater public awareness of the work of these institutions. The Human Rights Advisory Board 
–  a  body  representing  NGOs,  experts  and  ministries  –  has  not  been  operating  since  the 
publication of a report on minority rights in October 2004. 

Furthermore,  the  establishment  of  the  Ombudsman  has  been  outstanding  since  2006, 
following  the  application  of  former  President  Sezer  to  the  Constitutional  Court  for  the 
annulment of some provisions of the Law. The Constitutional Court suspended the entry into 
force of the Law pending its final ruling. In the absence of an Ombudsman system, there is no 
investigating  complaints  against 
alternative  remedy,  other 
administrative  decisions  at  central  and  local  level,  as  regards  the  respect  of  human  rights, 

judiciary,  for 

than 

the 

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liberties,  law  and  justice.  The  establishment  of  a  scrutiny  mechanism  via  the  Ombudsman 
would help defuse tensions between different sections of society by strengthening the rule of 
law and the protection of individual rights.  

Human rights defenders have faced criminal proceedings because of their work. Some faced 
threats from extremist groups, and were subsequently placed under police protection. 

Overall,  the  institutions  for  the  promotion  and  enforcement  of  human  rights  lack 
independence  and  resources.  The  introduction  of  an  Ombudsman  is  overdue  and  is  of  key 
importance  to  prevent  tensions  in  society.  Furthermore,  threats  to  personal  safety  and 
occasional  criminal  proceedings  have  an  adverse  effect  on  the  work  of  human  rights 
defenders. 

Civil and political rights 

The  rights  of  detainees  are  protected  by  a  comprehensive  set  of  safeguards  which  serve  to 
prevent cases of torture and ill-treatment in custody. This includes medical examinations of 
detainees in police custody. Efforts are ongoing to ensure compliance with these provisions. 
They  include  training  for  judges,  prosecutors  and  forensic  experts  with  a  view  to  better 
implementation of the Istanbul Protocol, which provides guidance on effective investigation 
and documentation of torture and ill-treatment cases.  

The Ministry of Interior continued its work for the establishment of an independent national 
mechanism to investigate citizens' complaints against law enforcement officers. As a next step 
the  establishment  of  this  mechanism  requires  public  consultations  on  its  structure  and 
function.  

The  Council  of  Forensic  Medicine  is  preparing  for  ISO  quality  accreditation,  which  will 
enhance  the  credibility  of  its  reports.  The  Council  has  seven  branch  offices,  and  efforts  are 
ongoing to increase the resources for forensic medicine in the country through the creation of 
units in each of Turkey's 81 provinces.  

However, the number of applications to NGOs in relation to cases of torture and ill-treatment 
has increased, in particular outside official places of detention, notably during apprehension, 
transfer, or in the open with no detention registered. Furthermore, there are cases where the 
legal safeguards in place failed to prevent or stop the occurrence of torture and ill-treatment 
while in custody or in prison. These developments are a matter of concern.  

Amendments to the law on the duties and legal powers of the police, adopted in 2007, provide 
that  the  police  are  not  entitled  to  use  force  unless  confronted  with  resistance.  These 
amendments, together with the instructions given to members of the security forces, appear to 
align the Turkish legislation with the ECHR standards. However, there are concerns that the 
implementation  of  this  law  has  resulted  in  cases  of  ill-treatment  during  routine  identity 
checks.  Strict  implementation  of  the  amended  provisions  needs  to  be  monitored  by  the 
Turkish authorities in order to prevent human right violations. 

Pending  the  ratification  of  OPCAT  (see  Ratification  of  international  human  rights 
instruments), that requests Parties to designate or establish an independent national preventive 
mechanism for monitoring places of detention, there is no such mechanism in place. Visits by 
the  Human  Rights  Boards  are  often  not  followed  up  and  the  boards  do  not  have  sufficient 
expertise. 

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The  use  of  statements  obtained  in  the  absence  of  legal  counsel  or  not  confirmed  before  a 
judge is prohibited by the Criminal Procedure Code. However, the Court of Cassation ruled 
that  the  ban  on  use  of  such  statements  does  not  apply  retroactively.  There  have  been  cases 
where lower courts have not removed such evidence from the case file, although allegations 
of ill-treatment were made by the defendant. 

Medical  reports  established  upon  admission  to  and  exit  from  police  custody  are  sometimes 
inaccurate due to lack of resources or expertise. Furthermore, for their own security, the legal 
framework allows doctors to request the presence of a law enforcement officer during medical 
examinations of detainees. However, in some reported cases, law enforcement officers were 
present during examinations without the request of the doctor in charge.  

Victims  of  torture  and  ill-treatment  rely  essentially  on  rehabilitation  services  provided  by 
NGOs. This is partly due to the lack or inaccessibility of State-sponsored services for victims 
of torture and ill-treatment. 

As concerns impunity, the Minister of Justice expressed a public apology for a recent case of 
death following torture in detention. However, impunity for human rights violations is a cause 
for  concern.  There  is  a  lack  of  prompt,  impartial  and  independent  investigation  into 
allegations  of  human  rights  violations  by  members  of  security  forces.  None  of  the  70 
complaints submitted to the prosecutor in relation to the Diyarbakir incidents in March 2006 
have been closed so far. Furthermore, judicial proceedings into allegations of torture and ill-
treatment  are  often  delayed  by  the  lack  of  efficient  trial  procedures  or  abuse  of  such 
procedures.  

Overall, there have been limited efforts as regards the prevention of torture and ill-treatment. 
A  comprehensive  set  of  safeguards  is  in  place.  However,  allegations  of  torture  and  ill-
treatment during detention or outside official places of detention are a cause for concern. The 
efforts  to  prevent  torture  and  ill-treatment  need  to  be  enhanced.  The  ratification  of  the 
OPCAT and the fight against impunity are key in this context.  

As regards access to justice, reports indicate that in urban areas most detainees have access to 
a lawyer immediately after detention. In rural areas, however, in particular in the South-East 
of  the  country,  there  have  been  cases  where defendants  have  not  had access  to  a  lawyer  on 
terms equivalent to those in urban areas. 

As  regards  prison  conditions,  the  physical  infrastructure  of  prisons  continued  to  improve. 
Twelve  new  prisons  have  been  completed  and  a  further  22  new  prisons  are  under 
construction.  

Staff training continued to improve. There are four prison staff training centres, which deliver 
pre-service, in-service and promotion training. The trainers have been trained under the EU's 
judicial modernisation and penal reform (JMPR) programme.  

Greater transparency was introduced to the operations of the Penal Institutions and Detention 
Houses Monitoring Boards. These boards carry out regular visits to prisons and the findings 
of their reports are now publicly accessible. Furthermore, the Law provides for the publication 
of  an  annual  report  on  the  activities  of  the  Penal  Institutions  and  Detention  Houses 
Monitoring Boards.  

However, the national framework for prison monitoring falls short of the requirements of the 
OPCAT (see Torture and ill-treatment). 

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Restrictions on prisoners' correspondence and inadequate health/psychiatric resources remain 
a  problem.  The  total  number  of  prisoners  is  95,551  for  a  total  prison  capacity  of  90,558. 
Prisons in big cities are especially faced with the problem of overcrowding. Implementation 
of  the  circular  on  high-security  F-type  prisons  has  failed  to  remedy  the  shortcomings  as 
regards  communal  activities  for  inmates.  Proper  implementation  of  the  circular  depends  on 
increasing  the  numbers  and  training  of  staff,  and  making  more  rooms  available  for  the 
activities of different groups of prisoners.  

life 
Provisions  allowing  solitary  confinement  of  persons  sentenced 
imprisonment remain in force. In its 2006 report on Turkey, the Council of Europe Committee 
for the Prevention of Torture indicated that such rules need to be applied for as short a time as 
possible and must be based on an individual risk assessment of the prisoner concerned.  

to  aggravated 

Cases of ill-treatment by prison staff have been reported, but few lawsuits have been launched 
to probe these allegations.  

Overall,  good  progress  was  made  on  improving  infrastructures  and  on  training  of  staff. 
However,  shortcomings  as  regards  restrictions  on  prisoners'  conditions,  on  solitary 
confinement and on occasional ill-treatment remain to be addressed. 

Open  debate  continues  in  the  Turkish  media  on  a  wide  range  of  issues,  including  those 
perceived  as  sensitive  by  Turkish  society.  In  April,  the  Turkish  parliament  adopted 
amendments to Article 301 of the Turkish Criminal Code with the intention of strengthening 
the safeguards for freedom of expression in Turkey. The amendments changed the wording 
of  the  article9,  lowered  the  upper  limit  of  the  penalty  and  abolished  the  higher  penalty  for 
insults  in  a  foreign  country.  Furthermore,  the  amendments  introduce  a  requirement  for 
permission  to  be  obtained  from  the  Justice  Minister  in  order  to  launch  a  criminal 
investigation.  A  circular  on  implementation  of  the  amended  article  was  issued  on  9  May 
200810.  

Following the adoption of the amendments to Article 301, Turkish courts had forwarded, by 
September,  257  cases  to  the  Minister  of  Justice  for  prior  authorisation.  This  requirement 
concerns  cases  at  the  investigation  stage  or  for  which  judicial  proceedings  have  started.  By 
September, the Minister had reviewed 163 cases and refused to grant permission to proceed in 
126 cases.  

However,  the  wording  of  Article  301  remains  largely  the  same  and  the  prior  authorisation 
requirement  opens  up  the  possibility  that  the  article  will  become  subject  to  political 

The amended article 301 reads as follows:  

9 
1. A person who publicly degrades the Turkish nation, the State of the Republic of Turkey, the Turkish Grand 
National  Assembly,  the  Government  of  the  Republic  of  Turkey  and  the  judicial  bodies  of  the  State, 
shall be sentenced to a penalty of imprisonment for a term of six months to two years 

2.  A  person  who  publicly  degrades  the  military  or  security  organisations  of  the  State  shall  be  sentenced  to  a 

penalty in accordance with the first section 

3. The expression of an opinion for the purpose of criticism does not constitute an offence.  
4. The conduct of investigation for such offence shall be subject to the permission of the Minister of Justice. 
10 

The circular referred to the relevant case law of the ECtHR on freedom of expression and pointed out 
that international conventions on human rights automatically become part of the Turkish legal order - 
without  any  additional  legislative  steps  for  transposition  -  once  they  have  been  adopted  by  the 
Parliament.  Furthermore,  the  circular  establishes,  that  for  offences  against  Article  301,  statements 
cannot  be  taken  from  the  suspect  without  permission  from  the  Minister  of  Justice  in  order  not  to 
discredit the suspect in the eyes of the public. 

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consideration. So far, the Minister of Justice authorised the criminal investigations to continue 
in  37  cases.  This  includes  one  case  which  was  initiated  following  a  statement  made  by  a 
Turkish writer on the Armenian issue shortly after the assassination of the Turkish journalist 
of  Armenian  origin,  Hrant  Dink.  Furthermore,  there  is  legal  uncertainty  as  regards  cases 
which had been granted authorisation by the Minister of Justice under the former Article 159 
of the Turkish Criminal Code.  

Other  legal  provisions  that  restrict  freedom  of  expression  remain  a  cause  of  concern.  For 
example, Articles 215, 216 and 217 of the Turkish Criminal Code, that criminalise offences 
against  public  order,  and  the  Anti-Terror  Law  have  been  applied  to  prosecute  and  convict 
those  expressing  non-violent  opinions  on  Kurdish  issues.  Turkish  judges  and  prosecutors 
apply a wide interpretation of the provision on "incitement to violence" or "public interest", in 
particular as concerns Kurdish-related issues. This is not in line with the ECtHR case law on 
freedom of expression and implies in particular a lack of differentiation between violent and 
non-violent  opinions.  Moreover,  press  articles  on  ongoing  judicial  proceedings  have  led  to 
prosecutions  and  convictions  under  Article  288  (attempt  to  influence  a  fair  trial)  of  the 
Turkish  Criminal  Code  or  under  the  Press  Law.  Similarly,  public  statements  on  the  right  to 
conscientious  objection  are  prosecuted  under  Article  318  (discouraging  the  people  from 
military service) of the Turkish Criminal Code.  

Furthermore,  there  have  been  statements  by  senior  figures  strongly  criticising  the  press,  in 
particular following press reports on alleged corruption cases and the fight against terrorism. 
Another  problematic  area  is  the  frequent  website  bans,  which  are  disproportionate  in  scope 
and  duration.  Along  with  other  websites,  the  popular  You  Tube  site  has  been  closed  down 
several times.  

The  Turkish  Armed  Forces  still  deny  access  to  military  receptions  and  briefings  to  some 
journalists and media organisations. 

The case against 53 DTP mayors for sending a letter to the Danish Prime Minister requesting 
that Roj TV not be closed was finalised in April 2008. The Court sentenced the defendants to 
2  months  and  15  days  imprisonment,  which  was  commuted  to  a  fine.  The  Court's  ruling 
cannot be appealed. 

Overall,  with  the  amendment  of  Article  301  there  has  been  some  progress  in  the  efforts  to 
strengthen  the  safeguards  for  freedom  of  expression,  which  is  a  priority  of  the  Accession 
Partnership. However, only a consistent track record of implementation will show whether or 
not the revised article is adequate. Moreover, further legislative reforms are needed to ensure 
full respect of freedom of expression, in law and in practice, in line with the ECHR and the 
ECtHR  case  law.  Against  the  background  of  pressures  on  the  press  and  electronic  media, 
there  is  a  need  to  guarantee  an  atmosphere  conducive  to  full  respect  of  the  freedom  of  the 
press. 

The legal framework for freedom of assembly is broadly in line with European standards.  

However, as regards implementation, arbitrary limitations have been applied in practice to the 
right to peaceful assembly. The Turkish police used disproportionate force against protestors 
and  trade  union  representatives  who  ignored  the  ban  on  1  May  demonstrations  in  Taksim 
Square  in  Istanbul.  The  Kurdish  Newroz  Spring  celebrations  in  March  2008  resulted  in 
violence  against  demonstrators  in  several  provinces,  in  particular  Hakkari,  Yuksekova  and 
Van.  Three  citizens  died  during  the  course  of  the  Newroz  demonstrations  in  Van. 

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Investigation files are pending on the circumstances of these deaths in the Van Chief Public 
Prosecution Office.  

Investigations have been initiated into the allegations of disproportionate use of force by the 
police during demonstrations. However, in such cases, the opening of a criminal case depends 
on the authorisation of the Governor. In certain cases, the authorisation has been refused for 
lack  of  conclusive  evidence,  against  the  findings  of  prior  investigations.  Furthermore,  some 
protestors who allege police ill-treatment during demonstrations have faced criminal charges. 
The criminal investigation into the cases of disproportionate force by the police during the 1 
May  2007  demonstrations  in  Istanbul  resulted  in  charges  being  pressed  against  two  police 
officers.  However, 
investigation  was  closed  without  any 
administrative sanction against the police officers on duty during the demonstrations.  

the  parallel  disciplinary 

Overall,  further  efforts  are  needed  to  ensure  freedom  of  assembly  in  practice  in  line  with 
European  standards,  as  arbitrary  limitations  and  disproportionate  use  of  force  against 
demonstrators still occur. 

As regards freedom of association, the legal framework further improved with the adoption 
of the amendments to the Law on foundations in February 2008. The scope of the new Law 
extends to all existing foundations. The new provisions relax the conditions for establishing a 
foundation  and  ease  the  regulatory  framework  for  their  activities,  in  particular  on  selecting 
board  members,  acquiring  or  selling  assets,  receiving  funds  from  abroad  and  co-operating 
with foreign foundations. The previous ban on foreigners establishing foundations in Turkey 
has  been  replaced  by  the  principle  of  reciprocity.  The  new  Law  provides  tax  incentives  for 
donations  to  all  foundations  and  allows  tax  exemptions  for  the  repair,  restoration  and 
landscaping of cultural properties that belong to foundations. Furthermore, the Law provides 
for  the  establishment  of  the  Foundations  Council  as  the  highest  decision-making  body  for 
foundations. As a positive step, the foundations themselves are represented in this new body. 

However, the obligations imposed by the Law on associations to notify the authorities before 
receiving  financial  support  from  abroad  and to  provide  detailed  documents  on  such  support 
continue  to  place  a  burden  on  associations'  operations.  Furthermore,  frequent  inspections  of 
NGOs receiving funds from abroad, including EC funds, remain a cause of concern. Certain 
NGO  activities  were  videotaped  by  the  security  forces,  especially  in  East  and  Southeast 
Turkey.  

The registration of the Turkish Armenian Business Development Council was rejected by the 
Governorate of Istanbul, without clear legal grounds. Following a case brought by the Istanbul 
Governorate,  an  Istanbul  court  decided  in  May  to  close  down  a  lesbian,  gay,  bisexual, 
transgender/transsexual (LGBTT) association. The Istanbul Governorate is accusing Amnesty 
International  (AI)  of  illegal  money  collection. The competent Istanbul Administrative Court 
heard the case and decided in favour of  AI. The  Governor has appealed the case before the 
Council of State. 

As  regards  political  parties,  the  closure  cases  against  the  AKP  and  the  DTP  (see section  on 
Parliament)  illustrate  that  the  current  legal  provisions  applicable  to  political  parties  do  not 
provide  political  actors  with  an  adequate  level  of  protection  from  the  state's  interference  in 
their freedom of association and freedom of expression.  

Overall,  there  were  improvements  to  the  legal  framework  on  freedom  of  association. 
However,  some  associations  faced  disproportionate  administrative  difficulties  or  judicial 

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proceedings. Furthermore, in the light of the recurrent closure cases against political parties, 
the legal provisions on political parties need to be amended in line with the case law of the 
ECtHR  and  best  practices  in  EU  Member  States,  as  outlined  by  the  Council  of  Europe's 
Venice Commission. This is a priority of the Accession Partnership. 

As  regards  civil  society  organisations,  governmental  bodies  regularly  consult  NGOs. 
However,  there  is  no  coherent  legal  framework  organising  this  cooperation.  As  a  result, 
consultations are held on an ad hoc basis, with unclear selection criteria, and do not result in 
tangible policy outputs. Political pluralism would be enhanced if participation of civil society 
and other stakeholders in policy-making were increased. Furthermore, the breadth and scope 
of civil society organisations needs to be strengthened. 

As  concerns  freedom  of  religion,  freedom  of  worship  continues  to  be  generally  respected. 
The Law on foundations adopted in February 2008 addresses, among other things, a number 
of  property  issues  regarding  non-Muslim  minorities  (See  Right  to  property  and  Freedom  of 
association). 

The  court  case  on  the  killing  of  three  Protestants  in  Malatya  in  April  2007  continued.  A 
leading defence lawyer was provided with protection after receiving threats. A limited number 
of court decisions have ruled against use of threats or insults against representatives of non-
Muslim minorities.  

As regards the Alevis, the government announced an initiative aimed at improving dialogue 
with this community and addressing its concerns. In what was noted as a first decision of its 
kind in the country, a municipal council recognised a Cem house as a place of worship and 
applied mosque tariffs to its water charges. 

However, the government's initiative has not been followed through. Overall, Alevis continue 
to face the same problems as before, in particular as regards education and places of worship. 
This has led an AKP Alevi MP to resign from the position of Advisor to the Prime Minister 
on Alevi issues. 

As regards education, under Article 24 of the Turkish Constitution religious culture and ethics 
classes are compulsory in the curricula of primary and secondary education. This was not the 
case previously, i.e. before the entry into force of the current Constitution in 1982. In October 
2007, further to an application lodged by a family who are followers of Alevism, the ECtHR 
11  found  that  these  classes  did  not  just  give  a  general  overview  of  religions  but  provided 
specific instruction in the major principles of the Muslim faith, including its cultural rites. The 
Court  requested  Turkey  to  bring  its  educational  system  and  domestic  legislation  into 
conformity with Article 2 of Protocol No1 to the ECHR. This ECtHR judgment needs to be 
implemented. In August 2008 an Alevi Federation applied to the Committee of Ministers of 
the Council of Europe complaining that this judgment is not being implemented and claiming 
that the new textbooks include superficial information on Alevis part of which could also be 
considered  misleading.  In  March  2008,  in  two  separate  cases,  the  Council  of  State  (CoS) 
decided  that  children  of  Alevi  families  were  entitled  to  be  exempted  from  these  religious 
education classes. 

As  regards  places  of  worship,  two  cases  regarding  Alevi  places  of  worship  (Cem  houses  or 
Cemevi) are pending before the courts, one of them before the Council of State. In both cases, 

11 

Hasan and Eylem Zengin v. Turkey case (Application 1448/04).  

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Alevis  were  refused  plots  to  construct  Cem  houses.  These  are  not  recognised  as  places  of 
worship and, as a result, receive no funding from the authorities. Two Protestant churches and 
a Jehovah's Witnesses assembly have been unable to register their places of worship.  

Attacks against non-Muslim clergy and places of worship have been reported in a number of 
provinces. Missionaries continue to be portrayed and/or perceived as a threat to the integrity 
of  the  country  and  to  the  Muslim  religion.  The  Turkish  Alliance  of  Protestant  Churches 
submitted  a  report  to  Parliament's  Human  Rights  Committee  on  the  state  of  religious 
minorities in Turkey. This report pointed out that non-Muslim groups in the country had been 
the  targets  of  attacks,  provided  a  list  of  such  incidents  and  noted  that  no  suspects  had  been 
arrested. Implementation of the Ministry of Interior circular of 19 June 2007 on freedom of 
religion of non-Muslim Turkish citizens has not yet had the desired effects. 

Non-Muslim communities – as organised structures of religious groups – still face problems 
due  to  lack  of  legal  personality.  Restrictions  on  the  training  of  clergy  remain.  Turkish 
legislation does not provide for private higher religious education for these communities and 
there are no such opportunities in the public education system. The Halki (Heybeliada) Greek 
Orthodox  seminary  remains  closed.  There  have  been  reports  of  foreign  clergy  who  wish  to 
work in Turkey facing difficulties in obtaining work permits. The Ecumenical Patriarch is not 
free  to  use  the  ecclesiastical  title  Ecumenical  on  all  occasions.  In  January  2008,  Prime 
Minister Erdogan declared that use of the title "ecumenical" should not be a matter on which 
the State should rule.  

Judicial  proceedings  against  conscientious  objectors  have  continued  and  there  have  been 
frequent allegations of ill-treatment of conscientious objectors in prison. Furthermore, public 
statements  on  the  right  to  conscientious  objection  have  led  to  convictions  (see  section  on 
freedom of expression and observance of international human rights law).  

Overall,  there  has  been  some  progress,  in  particular  as  regards  adoption  of  the  Law  on 
foundations.  However,  the  implementation  of  the  Law,  together  with  the  resolution  of  the 
outstanding  property-related  issues  regarding  non-Muslim  minorities  remains  a  challenge. 
Furthermore, Alevis continue to face the same problems, including on education and places of 
worship. A legal framework in line with the ECHR has yet to be established, so that all non-
Muslim  religious  communities  and  Alevis  can  function  without  undue  constraints.  Turkey 
needs to make further efforts to create an environment conducive to full respect for freedom 
of religion in practice and to carry out consistent initiatives aimed at improving dialogue with 
the various religious communities. 

Economic and social rights 

As regards women's rights, the Prime Ministerial circular on combating honour killings and 
domestic  violence  against  women  has  helped  to  improve  cooperation  between  public 
institutions.  Awareness-raising  activities  have  been  organised  for  members  of  the  judiciary 
and  law  enforcement  bodies.  To  date,  30 000  law  enforcement  officers  have  reportedly 
participated in training with a further 10 000 planned by the end of 2008. Gender sensitivity 
training programmes have also been conducted for health workers. The number of shelters for 

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women  victims  of  domestic  violence  has  marginally  increased.  Courts  have  applied  the 
amended Law on protection of the family12. 

There  are  some  notable  examples  of  high-level  presence  of  women  in  Turkish  society  in 
business,  academia,  the  civil  service  and  politics.  Parliament  adopted  the  "Employment 
Package"  amending  the  Labour  Law  and  certain  other  laws  in  order  to  promote  women's 
employment. (See Chapter 19 – Social policy and employment). The gender gap in primary 
education decreased further to 2.3% (See Children's rights). 

However,  gender  equality  remains  a  major  challenge  in  Turkey.  According  to  official 
statistics,  participation  by  women  in  the  labour  force  is  low  (24.8  %  in  2007),  and  on  a 
decreasing  trend.  The  rate  of  women's  employment  is  the  lowest  among  the  EU  Member 
States and the OECD countries. 

Political  representation  of  women,  at  both  national  and  regional  levels,  is  very  low.  Civil 
society organisations have submitted proposals to address this issue, in particular with a view 
to the forthcoming municipal elections scheduled for 2009.  

Documents posted on the Diyanet's (Presidency for Religious Affairs)  site contain language 
perceived by NGOs as discriminatory against women. 

Women's  access  to  education  is  the  lowest  among  the  EU  Member  States  and  the  OECD 
countries.  The  good  results  on  reducing  the  gender  gap  in  primary  education  need  to  be 
sustained  and  strengthened,  in  particular  by  ensuring  the  continuing  attendance  of  girls  at 
school and identifying and addressing school drop-outs (see children's rights). 

Domestic violence, honour killings, and early and forced marriages are still a serious problem. 
The  Court  of  Cassation  ruled  that  sentences  for  honour  killings  are  given  only  if  there  is 
evidence  showing  that  the  murder  was  committed  following  a  decision  of  the  family 
assembly. This decision was criticised by a member of the Court, who claimed that it would 
complicate efforts to eradicate these killings. According to the Prime Ministry Human Rights 
Directorate,  220  honour  killings  were  reported  in  the  country  in  2007,  most  of  which 
happened  in  big  cities.  This  is  an  increase  compared  with  2006  and  illustrates  the  need  to 
target efforts to raise awareness on women's rights among urban migrants. Finally, there is a 
need to improve reliability of data on all these issues. 

Women  are  reportedly  reluctant  to  have  recourse  to  the  police  or  the  courts  due  to  lack  of 
confidence in provision of effective protection. Women's economic fragility further reinforces 
this attitude. The Law on municipalities13, in particular the provisions on shelters, are not yet 
fully implemented and the number of shelters remains lower than provided for under that law. 
Women's  NGOs  are  conducting  surveys  to  define  the  number  and  capacity  of  properly 
functioning  shelters.  NGOs  have  reported  that  it  is  not  possible  to  obtain  information  about 
the scope or an assessment of the impact of awareness-raising campaigns.  

A Gender Equality Body and a Parliamentary Committee on Gender Equality have still to be 
established. Women's civil society organisations have requested the establishment of a fully-

12 

13 

Amendments have extended the Law to all individuals in the family, including family members living 
separately. They have also abolished all fees for applications and administrative transactions related to 
court proceedings.  
The  2005  Law  on  municipalities  provides  for  establishment  of  shelters  for  women  in  metropolitan 
municipalities and in municipalities with a population of 50 000 or more. 

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fledged  committee  that  could  play  an  essential  role  in  mainstreaming  women's  issues  in  all 
policy areas. 

There have been complaints from civil society organisations about the consultations organised 
by the government on the direction and implementation of gender policy. These relate to both 
the  limited  number  of  civil  society  organisations  consulted,  but  also  the  extent  to  which 
positions expressed are eventually taken into account. 

Overall, the legal framework guaranteeing women's rights and gender equality is broadly in 
place.  However,  further  significant  efforts  are  needed.  To  reduce  the  gap  between  men  and 
women  in  economic  participation  and  opportunity,  educational  attainment,  access  to 
healthcare,  and  political  empowerment.  Efforts  to  prevent  honour  killings  and  domestic 
violence have continued. However, these issues remain a serious problem, and efforts need to 
be stepped up. 

With respect to children's rights, there was an increase in net primary school enrolment from 
90% in the 2006/2007 school year to 97% in 2007/200814. Over the same period, the gender 
gap in primary education was halved from 4.6% to 2.3%. The number of pupils in pre-school 
education has increased by 28% over the last three years, from 550,000 in 2005 to 700,000 in 
2007.  The  government  target  is  to  attain  a  50%  pre-school  enrolment  rate  from  the  current 
25%.  The  Ministry  of  National  Education  has  established  an  e-school  database  containing 
information  on  school  attendance.  The  Ministry  can  thus  identify  children  that  are  out  of 
school  and  try  to  ensure  their  enrolment  or  provide  catch-up  education.  In  May  2008,  the 
Education Board approved the catch-up education programme: this is meant to give a second 
chance to children of 10–14 years of age who either never enrolled or who dropped out. This 
measure  is  targeted  mainly  at  working  and  Roma  children.  In  addition,  mobile  schools  are 
trying to reach out to children working in agriculture. 

The  proportion  of  children  under  15  years  of  age  in  households  experiencing  poverty 
decreased  from  27.7%  in  2005  to  25.2%  in  2006.  The  Social  Services  and  Child  Protection 
Agency  (SHCEK)  has  collected  data  on  domestic  violence  and  child  abuse  and  on  children 
living and working on the streets. However, these data have not yet been made public. 

Minimum standards on care and protection for children living outside parental care have been 
developed, and efforts to strengthen and monitor the parenting system have intensified. The 
new  Social  Insurance  and  General  Health  Insurance  Law  provides  for  coverage  for  every 
citizen  under  18  years  of  age.  Parliament  has  ratified  the  Hague  Convention  on  the  Civil 
Aspects  of  International  Child  Abduction,  which  provides  for  a  simplified  procedure  for 
returning children to their legal custodian. 

SHCEK  has  recruited  new  members  of  staff.  The  number  of  specialised  staff  such  as 
psychologists, child development experts and sociologists increased during the same period. 
Staff  of  institutions  involved  in  child  care,  including  members  of  the  judiciary,  have  been 
trained  on  juvenile  justice.  SHCEK  has  also  made  efforts  to  improve  the  quality  of  the 
services it provides and has assumed more responsibilities in implementation of the Law on 

14 

This is partly due to the revised method of calculation of the total population. The Turkish Statistical 
Institute  (TURKSTAT)  revised  its  population  figures  based  on  its  new  address-based  population 
registration system. Thus, the Ministry of National Education's formal education statistics for 2007-08 
apparently paint the clearest picture yet of enrolment rates at various levels of the school system and of 
the gender gap in access to education. 

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child protection. Reception centres have been opened in a number of provinces for children 
who are perpetrators or witnesses of crimes or victims of violence. Six (6) such centres were 
established  for  the  first  time  in  2007  in  accordance  with  provisions  of  the  Child  Protection 
Law.  Four  (4)  of  these  centres  are  "Protection,  care  and  rehabilitation  centres"  and  assist 
children  involved  in  criminal  activities;  two  (2)  are  "Care  and  social  rehabilitation  centres" 
and assist child victims of violence and abuse. 

However,  respect  for  and  implementation  of  children's  rights  continue  to  be  a  matter  of 
concern.  Children  out  of  school  remain  a  problem:  the  e-school  database  has  revealed  that 
approximately 450 000 children between 6 and 14 years of age do not attend school. 

Implementation  of  minimum  standards  of  care  and  protection  of  children  living  outside 
parental  care  needs  to  be  improved.  SHCEK  needs  to  make  the  data  on  domestic  violence 
against  children  and  child  abuse  and  on  children  living  and  working  on  the  streets  publicly 
available in order to improve policy-making and public debate. Efforts to combat child labour 
in the field need to improve and shortcomings in legislation15 must be addressed. 

Despite  some  progress  in  the  juvenile  justice  system,  the  number  of  child  courts  is  still 
inadequate16,  there  is  a  lack  of  social  workers  in  these  courts  and  their  workload  is  heavy. 
This results in longer trials17 and, thus, possibly in children being deprived of their liberty for 
longer periods of time. There has been an increase in the number of children in detention. The 
conditions in detention centres need to be improved, both in terms of physical conditions and 
as regards the quality of the services provided. The probation system should also be improved 
to prevent recurrence of the offence and to support children and their families. 

Overall,  there  has  been  progress  on  access  to  education,  social  services  and  the  juvenile 
justice  system.  However,  efforts  need  to  continue  in  all  areas  related  to  children's  rights, 
including administrative capacity, education, the juvenile justice system and child labour. 

As regards socially vulnerable persons and/or persons with disabilities, the State will pay 
the social security premiums for people with disabilities to promote their employment. There 
was  an  increase  in  the  resources  allocated  to  care  services  for  people  with  disabilities.  A 
circular was issued with a view to immediate placement of people with disabilities who are in 
need of urgent care. As regards mental health, progress has been made in the field of electro-
convulsive  therapy  which  is  implemented  in  hospitals  in  line  with  medical  standards  and 
respecting patients' rights. 

However, people with disabilities are not receiving adequate public services. This is mainly 
due  to  lack  of  awareness  of  the  available  services  and  problems  in  accessing  the  services, 
especially physical barriers. The lack of data and research on persons with a disability and on 
conditions of care for mentally ill persons is preventing informed policy-making. Community-
based  services  are  not  sufficiently  developed  as  an  alternative  to  institutionalisation,  and 

15 

16 

17 

The labour law prohibits night work for children under eighteen (18) only for the industry sector; it does 
not  provide  protection  for  children  working  in  agricultural  enterprises  employing  less  than  fifty  (50) 
employees;  and  it  does  not  regulate  the  work  of  children  in  artistic  and  cultural  activities  and  in  the 
media.  Lastly,  the  current  legislative  framework  does  not  tackle  the  issue  of  children  working  on  the 
streets. 
Under  the  2005  Law  on  child  protection,  child  courts  need  to  be  established  in  every  province. 
However, currently there are such courts in only 40 of the 81 provinces in the country. 
On the basis of 2005 data, the average duration of trials in child courts is 326 days, compared with 234 
days in ordinary courts. 

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resources  continue  to  be  limited  in  relation  to  needs.  There  is  an  ongoing  problem  of 
insufficient  general  medical  care  and  treatment  in  mental  health  hospitals  and  rehabilitation 
centres. 

On labour rights and trade unions, the pending legislation amending the Trade Unions and 
Collective Bargaining, Strike and Lockout Laws has not moved forward substantially. Turkey 
needs to ensure that trade union rights are fully respected in line with EU standards18 and the 
relevant  International  Labour  Organisation  (ILO)  conventions,  in  particular  the  rights  to 
organise, to strike and to bargain collectively. This is a priority of the Accession Partnership. 
There  are  reports  about  restrictions  on  the  exercise  of  existing  trade  union  rights  and 
dismissals due to trade union membership. Social dialogue mechanisms, including at tripartite 
level, are weak (See also Chapter 19 – Social policy and employment). 

The  principle  of  anti-discrimination  is  enshrined  in  the  Constitution  and  upheld  in  several 
laws. Homosexual relationships between consenting adults in private are permitted in Turkey. 
In recent years, associations of the lesbian, gay, bisexual and transgender (LGBT) community 
registered  for  legal  status  in  Turkey  and  prosecutors  refused  to  press  charges  following  a 
request by the Ministry of Interior to close them. This has enabled them to start advocating 
and defending the rights of lesbian, gay, bisexual and transgender people.  

However,  the  law  does  not  duly  mention  all  the  grounds  of  discrimination,  such  as  sexual 
orientation,  and  provisions  of  the  Turkish  Criminal  Code  on  "public  exhibitionism"  and 
"offences against public morality" are sometimes used to discriminate against LGBT. In May 
2008,  upon  an  appeal  by  the  Istanbul  Governorate, an Istanbul court decided to  close down 
Lambda Istanbul, as its statute was considered against general morality. An appeal has been 
lodged before the Council of State in this case.  

Homosexuals  have  the  right  to  exemption  from  military  service.  If  they  request  such 
exemption,  their  sexual  orientation  is  verified  by  means  of  degrading  medical  and 
psychological tests or by demanding proof of homosexuality. 

Transsexuals  are  occasionally  subjected  to  physical  assaults,  including  by  the  police. 
Homophobia  has  also  resulted  in  cases  of  physical  and  sexual  violence.  These  allegations 
require prompt and effective investigation. 

With  respect  to  property  rights,  the  Law  on  foundations  was  adopted  in  February  200819. 
This Law was first voted by Parliament in November 2006, but was subsequently vetoed by 
the  then  President  Sezer.  The  Law  addresses  a  large  number  of  issues  faced  by  religious 
communities,  mainly  over  management  and  acquisition  of  property.  In  particular,  under  the 
Law,  community  foundations  can  own  property  and  manage  it  without  prior  permission20. 
Foundations  can  establish  companies  and  commercial  bodies  and  can  participate  in  existing 
companies  with  a  view  to  achieving  their  objectives  and  generating  income.  Non-Muslim 
community  foundations  can  register  in  the  Land  Registry,  under  their  names,  immovable 

18 

19 

20 

Turkey  maintains  its  reservations  on  article  5  (right  to  organise)  and  article  6  (right  to  bargain 
collectively) of the revised European Social Charter. 
In  March  2008,  the  opposition  Republican  People's  Party  (CHP)  filed  an  application  with  the 
Constitutional Court requesting annulment of Articles 5(3), 6(3), 11, 12(1), (2) and (3), 14, 25, 26, 41 
and 68 of the Law. The Law entered into force on 28 February 2008. 
A court decision should be issued when foundations sell immovable property or rights acquired on their 
establishment,  whereas  only  a  decision  by  the  competent  body  of  the  foundation  is  needed  to  sell 
immovable property or rights acquired at a later stage. 

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property which is either entered in their 1936 declarations, under figurative or fictitious names 
or  was  purchased  by  or  bequeathed  or  donated  to  community  foundations  after  their  1936 
declarations but registered under the name of the testator or of the donator or of the Treasury 
or  of  the  Directorate-General  for  Foundations  because  of  restrictions  on  owning  property. 
Donations  of  immovable  property  to  foundations  cannot  be  seized  or  mortgaged.  Properties 
which are no longer used, wholly or in part, for their original purpose, can be transferred to 
another  foundation  of  the  same  community,  leased  or  have  their  use  changed.  The 
Directorate-General for Foundations issued a Circular in May 2008 that deals with the process 
of restitution of properties of non-Muslim foundations registered under figurative or fictitious 
names,  or  in  the  name  of  the  Treasury  or  the  Directorate  General  for  Foundations.  An 
implementing regulation was published in the Official Gazette in September 2008. 

However, the Law addresses neither the issue of properties seized and sold to third parties nor 
that of properties of foundations that were fused before the adoption of the new legislation. In 
addition, implementation will be crucial to attaining its objectives.  

On 8 July 2008, the  ECtHR  decided21 on the claim of the  Ecumenical Patriarchate that had 
been deprived of its property acquired in 1902 and dedicated to a specific use in 1903 via the 
Foundation of the Büyükada Greek Orphanage for Boys. The applicant alleged, in particular, 
that  by  ordering  registration  of  its  real  estate  in  the  name  of  the  orphanage,  under  the 
management  of  the  State  Directorate-General  for  Foundations22,  the  domestic  courts  had 
breached  its  right  to  peaceful  enjoyment  of  its  property.  The  Court  held  that  the  Turkish 
authorities  were  not  entitled  to  deprive  the  owner  of  its  property  without  providing  for 
appropriate compensation, and that there had been a violation of the ECHR. 

Problems encountered by Greek nationals in inheriting and registering property continue to be 
reported, in particular as regards, inter alia, the application by the Turkish authorities of the 
amended Land Registry Law. With respect to that issue, the ECtHR held23 that there had been 
a violation of Article 1 of Protocol 1 (peaceful enjoyment of possessions) to the ECHR and 
ordered either the return of the property or the financial compensation of the applicants. 

Syriacs  continue  to  face  difficulties  in  relation  to  property.  Complaints  about  the  seizure  of 
their  properties  have  increased,  in  particular  in  the  context  of  the  establishment  of  the 
cadastre. This concerns both private individuals and religious institutions. 

Overall,  adoption  of  the  Law  on  foundations  has  been  a  welcome  step  forward.  However, 
implementation of the Law will be crucial. The outstanding issues also need to be addressed. 
Finally,  the  quality  of  the  dialogue  between  the  authorities  and  the  communities  concerned 
will be instrumental in creating an environment conducive to achieving progress. 

Minority rights, cultural rights and protection of minorities 

Turkey's approach to minority rights, which refers to the 1923 Treaty of Lausanne24 remains 
unchanged. Without prejudice to the Treaty, the Turkish authorities consider Turkish citizens 

21 
22 

23 
24 

Fener Rum Patrikligi (Ecumenical Patriarchate) v. Turkey case (application 14340/05) 
The Directorate-General for Foundations considered the orphanage a "defunct" foundation in 1995 and 
took over its management. 
Apostolidis & Others vs. Turkey (Application No. 45628/99). 
According to the Turkish authorities, under the 1923 Treaty of Lausanne minorities in Turkey consist 
exclusively  of  non-Muslim  religious  communities.  In  practice,  the  minorities  which  the  authorities 
associate with the Treaty are Jews, Armenians and Greeks. 

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as  individuals  with  equal  rights  before  the  law,  rather  than  as  individuals  belonging  to  the 
majority  or  to  a  minority.  This  should  not  prevent  Turkey,  in  accordance  with  European 
standards,  from  granting  specific  rights  to  certain  Turkish  citizens  on  the  grounds  of  their 
ethnic origin, religion or language, so that they can preserve their identity. Full respect for and 
protection of language, culture and freedom of association, assembly, expression and religion 
and  effective  participation  in  public  life  for  all  citizens  irrespective  of  their  background  or 
origin,  in  accordance  with  the  principles  laid  down  in  the  Framework  Convention  for  the 
Protection of National Minorities and in line with best practice in Member States, have yet to 
be fully achieved. 

Turkey  is  a  party  to  the  UN  International  Covenant  on  Civil  and  Political  Rights  (ICCPR). 
However, its reservation regarding the rights of minorities and its reservation concerning the 
UN  Covenant  on  Economic,  Social  and  Cultural  Rights  (ICESCR)  regarding  the  right  to 
education are causes for concern25. Turkey has not signed the Council of Europe Framework 
Convention for the Protection of National Minorities or the European Charter for Regional or 
Minority Languages. 

The repeated requests of the OSCE High Commissioner on National Minorities (HCNM) to 
follow up on his last visit to Turkey of December 2006 were not accommodated. There is a 
need to start a dialogue between Turkey and the HCNM on issues such as the participation of 
minorities  in  public  life  and  broadcasting  in  minority  languages.  This  would  facilitate 
Turkey's  further  alignment  with  international  standards  and  best  practice  in  EU  Member 
States. 

Management of minority schools, including the dual presidency, remains an issue, pending an 
implementing  regulation.  Work  is  under  way  to  remove  discriminatory  language  from 
textbooks. 

The  Greek  minority  continues  to  encounter  problems  with  education  and  property  rights.  In 
June, the Parliamentary Assembly of the Council of Europe (PACE) adopted a Resolution26 
on  the  Greek  minority  on  the  islands  of  Gökçeada  (Imvros)  and  Bozcaada  (Tenedos).  The 
resolution calls for preserving the bicultural character of the two Turkish islands as a model 
for  cooperation  between  Turkey  and  Greece.  Furthermore,  it  takes  account  of  positive 
gestures made by the Turkish authorities, mainly in connection with the Greek community's 
architectural heritage, and calls on Turkey to maintain up the momentum by taking additional 
measures, in particular on property and education issues. 

Overall,  Turkey  has  made  no  progress  on  ensuring  cultural  diversity  and  promoting  respect 
for and protection of minorities in accordance with European standards. 

As regards cultural rights, following the June 2008 amendments to the relevant Law, TRT - 
the public service broadcaster - is allowed to broadcast nationally all day long in languages 
other than Turkish. Since 2004 this has only been possible for half a day. An appeal against 
the Law is pending before the Constitutional Court. Furthermore, a new local radio channel, 
Muş FM, has received authorisation to broadcast in Kurdish.  

25 

26 

Extract from the reservation to the ICCPR: "The Republic of Turkey reserves the right to interpret and 
apply  the  provisions  of  Article  27  of  the  International  Covenant  on  Civil  and  Political  Rights  in 
accordance with the related provisions and rules of the Constitution of the Republic of Turkey and the 
Treaty of Lausanne of 24 July 1923 and its Appendixes."  
Resolution 1625 (2008). 

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However, the launching of a channel broadcasting in languages other than Turkish has been 
delayed on several occasions. Furthermore, two of the four local TV and radio channels that 
started  broadcasting  in  languages  and  dialects  traditionally  used  by  Turkish  citizens  closed 
down  during  the  reporting  period.  Time  restrictions  laid  down  in  the  law  on  the  Radio  and 
Television  Supreme  Council  (RTÜK)  continue  to  apply,  with  the  exception  of  films  and 
music programmes. Educational programmes teaching the Kurdish language are not allowed. 
All broadcasts, except songs, must be subtitled or translated into Turkish. These restrictions 
make  broadcasting 
than  Turkish  cumbersome  and  non-viable 
commercially.  The  police  and  the  Radio  and  Television  Supreme  Council  (RTÜK)  apply  a 
policy  of  strict  monitoring  of  broadcasts  in  Kurdish.  Several  court  cases  and  investigations 
against GÜN TV - the only TV channel currently broadcasting in Kurdish - are ongoing, in 
relation to the wording of Kurdish songs the channel has aired.  

languages  other 

in 

Children whose mother tongue is not Turkish cannot learn it in the Turkish public schooling 
system.  Under  the  current  legislation  such  education  can  be  provided  only  by  private 
educational  institutions.  However,  in  the  case  of  Kurdish,  courses  which  had  opened 
following the changes to the law have now closed down. As a result, there are currently no 
opportunities to learn Kurdish in either the public or private schooling system. 

No  measures  have  been  taken  to  facilitate  access  to  public  services  for  non-speakers  of 
Turkish,  although  interpretation  is  usually  available  in  courts.  The  case  against  the 
municipality  of  Sur  (Central  Diyarbakir)  in  June  2007,  in  which  the  Council  of  State 
dismissed  the  mayor  from  office  and  dissolved  the  Municipal  Council  for  providing 
multilingual municipal services, is now before the ECtHR. A vice-governor will continue to 
serve  as  mayor  of  Sur  until  new  elections,  scheduled  in  March  2009,  although  by  law  by-
elections should have been held within 60 days of the dismissal.  

According  to  the  Law  on  political  parties,  the  use  of  languages  other  than  Turkish  remains 
illegal in political life. In this context, a large number of investigations and court cases have 
been launched against officials and executives of the Democratic Society Party (DTP).  

As  regards  Roma,  no  steps  have  been  taken  to  amend  the  Law  on  the  Movement  and 
Residence of Aliens, which authorises "the Ministry of Internal Affairs to expel stateless and 
non-Turkish  citizen  gypsies  and  aliens  that  are  not  bound  to  the  Turkish  culture",  thus 
promoting discrimination against Roma. This provision needs to be repealed. Turkey has yet 
to  establish  a  strategy  to  address  the  problems  of  Roma.  Turkey  is  not  participating  in  the 
2005-2015 Decade of Roma Inclusion. 

Roma,  who  comprise  other  similar  but  distinct  ethnic  groups  such  as  Dom,  Lom  and 
Travellers, face social exclusion and marginalisation in access to education, discrimination in 
health  services,  exclusion  from  employment  opportunities,  difficulties  in  accessing  personal 
documentation and exclusion from participation in public affairs and public life.  

As  regards  housing,  the  Roma  population  has  faced  several  instances  of  demolition  of 
communities,  forced  evictions  and  exposure  to  poor  living  and  sanitary  conditions  without 
recourse  to  any  publicly  accountable  process.  In  many  cases,  Roma  who  have  been 
dispossessed as a result of demolition join the ranks of IDPs, with all the social problems that 
this entails. As regards demolition of the Roma neighbourhood in Istanbul’s Sulukule district 
and the relocation of its members, which started in spring 2008, the Prime Ministry's Human 
Rights Commission has called for an inquiry into any possible infringement of human rights. 

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In  addition,  civil  society  organisations  have  filed  a  suit  for  cancellation  of  the  urban 
regeneration project in Sulukule.  

Overall,  Turkey  made  some  limited  progress  on  cultural  rights,  but  restrictions  continue, 
particularly  on  the  use  of  languages  other  than  Turkish  in  broadcasting,  in  political  life  and 
when  accessing  public  services.  There  are  no  opportunities  to  learn  these  languages  in  the 
public or private schooling systems. There has been no progress in the situation of the Roma, 
who frequently face discriminatory treatment in access to adequate housing, education, social 
protection,  health  and  employment.  Demolitions  of  Roma  neighbourhoods,  in  some  cases 
involving forced evictions, continue. 

Situation in the East and South-East 

In  May  2008  the  Government  announced  the  guidelines  and  general  content  of  a  plan  for 
development of the South-East. The Government pledged to allocate total funding equivalent 
to €14 billion to complete the ongoing South-East Anatolia Project (GAP) between 2008 and 
2012, thus increasing the originally planned spending on the project by €10.2 billion. The four 
pillars  of  the  action  plan  are:  economic  development,  social  development,  infrastructure 
development and institutional strengthening. Most investments will concentrate on the energy 
and agriculture sectors.  

Terrorist attacks by the PKK, which is on the EU list of terrorist organisations, continued in 
the  South-East,  but  also  throughout  the  country  and  claimed  many  lives.  Following 
parliament's  authorisation  the  government  ordered  air  strikes  against  terrorist  hideouts  in 
Northern  Iraq.  The  "temporary  security  zones"  established  in  June  2007  in  the  provinces  of 
Sirnak, Siirt and Hakkari close to the Iraqi border remain operational. 

The Newroz spring celebrations were marked by tensions in the provinces of Van and Hakkari 
(see section on freedom of assembly). No incidents were reported in other provinces, such as 
Diyarbakir and Istanbul, where demonstrations were allowed.  

Landmines  remain  a  security  concern  for  both  military  personnel  and  civilians.  The 
government  reported  ongoing  use  of  anti-personnel  mines  by  the  PKK/KONGRAGEL. 
During the reporting period there have been 66 casualties among civilians and security forces 
due  to  anti-personnel  landmine  explosions.  Under  the  Convention  on  the  Prohibition  of  the 
Use, Stockpiling, Production and Transfer of Anti-Personnel Mines and on Their Destruction 
(the 'Ottawa Convention'), of which it is a signatory party, Turkey has undertaken to destroy 
all antipersonnel mines in mined areas as soon as possible, but no later than 1 March 2014.  

Refugees and internally displaced persons 

The  process  of  compensation  of  losses  due  to  terrorism  and  the  fight  against  terrorism 
continued to make progress. By May 2008, 313 829 cases had been filed under the relevant 
Law. Some 40% of these, i.e.126 945 cases have been finalised, out of which 82 893 obtained 
a  favourable  response.  The  deadline  for  applications  for  compensation  expired  on  31  May 
2008.  

However,  despite  the  efforts  made  by  the  Government  to  improve  the  situation,  reports  on 
shortcomings in implementation of the Law, in particular as regards uneven and inequitable 
calculation of compensation between provinces, have continued. Furthermore, due to lack of 
resources and the heavy workload of the Damage Assessment Commissions, progress in the 
assessment and payment of compensation has been slow. 

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The situation of IDPs in urban areas remains a cause for concern. IDPs suffer from economic 
and  social  marginalisation  and  have  little  or  no  access  to  social,  educational  and  health 
services.  Return  of  IDPs  is  prevented  by  a  number  of  factors.  These  include  mainly  the 
security situation, but also the lack of basic infrastructure, lack of capital, limited employment 
opportunities and the threat posed by the village guard system.  

There  is  no  overall  national  strategy  to  address  the  situation  of  IDPs.  The  insufficient 
institutional  capacity  of  departments  responsible  for  IDPs  remains  a  challenge.  There  is  a 
need to involve civil society further in the development of IDP policies.  

No steps have been taken to abolish the system of village guards. 

Arbitrary  cases  of  refoulement,  although  not  numerous,  remain  a  high  concern.  There  are 
reports that one of them ended in life loss. (For the situation of asylum seekers and refuges 
see chapter 24, Justice, Freedom and Security). 

Overall, as regards the East and South-East, the government's decision to complete the South-
East  Anatolia  Project  is  a  step  in  the  direction  of  addressing  the  economic  and  social 
difficulties of the region. Further efforts are needed in order to create the conditions for the 
predominantly  Kurdish  population  to  enjoy  full  rights  and  freedoms.  Compensation  of 
internally displaced persons (IDPs) has continued. However, the government lacks an overall 
national strategy to address the IDP issue. The village guard system still has to be phased out. 

2.3. 

Regional issues and international obligations 

Cyprus 

The  Turkish  government  has  continued  to  express  its  commitment  to  a  comprehensive 
settlement of the Cyprus problem under the auspices of the United Nations. It welcomed the 
start  full-fledged  negotiations  in  September  between  the  leaders  of  the  two  Cypriot 
communities under the Good Offices Mission of the UN Secretary General. Turkey needs to 
take concrete steps to contribute to a favourable climate for a comprehensive settlement.  

Since the Council's decision of December 2006, Turkey has made no progress towards fully 
implementing the Additional Protocol. 

Turkey has made no progress on normalising bilateral relations with the Republic of Cyprus. 
Turkey  continues  to  veto  Cyprus's  membership of several  international organisations and of 
the Wassenaar Agreement on the Code of Conduct on Arms Exports and on Dual-Use Goods.  

Peaceful settlement of border disputes 

Turkey and Greece have continued their efforts to improve bilateral relations. The 40th round 
of exploratory talks was held in July 2008 in Athens. Exploratory talks have been continuing 
since 2002. 

In November 2007, the Turkish and Greek Prime Ministers met at the border to inaugurate a 
natural  gas  pipeline.  In  January  2008,  the  Greek  Prime  Minister  paid  an  official  visit  to 
Turkey - the first of this kind in 49 years. Both Prime Ministers expressed their commitment 
to improving bilateral relations. 

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So  far  31  agreements  have  been  signed  and  24  confidence-building  measures  have  been 
agreed  since  2000.  The  third  joint  exercise  between  military  disaster  response  units  was 
conducted in May in Athens. Contacts at military level continue. The Greek Chief of General 
Staff paid an official visit to Turkey in May 2008.  

The threat of "casus belli" in relation to the possible extension of Greek territorial waters in 
the  resolution  adopted  by  the  Turkish  Grand  National  Assembly  in  1995  still  remains.  The 
Council highlighted in December 2007 that “Turkey needs to unequivocally commit to good 
neighbourly  relations  and  to  the  peaceful  settlement  of  disputes  in  accordance  with  the  UN 
Charter,  including,  if  necessary,  jurisdiction  of  the  International  Court  of  Justice.  In  this 
context, any threat or action which could negatively affect good neighbourly relations and the 
peaceful settlement of disputes should be avoided”. 

During the reporting period, Greece formally complained to Turkey about continued airspace 
violations. 

As a full member of the Barcelona process, Turkey participated in the launch of the Barcelona 
Process: Union for the Mediterranean in July 2008. 

Bilateral  relations  with  other  enlargement  countries  and  other  neighbouring  Member 
States  have  been  developing  positively.  Turkey  continues  to  play  a  positive  role  in  the 
Western Balkans. Relations with Bulgaria remained positive. 

As regards the International Criminal Court (ICC), see Chapter 31 – Common Foreign and 
Security Policy. 

3. 

ECONOMIC CRITERIA 

In examining the economic developments in Turkey, the Commission's approach was guided 
by the conclusions of the European Council in Copenhagen in June 1993, which stated that 
membership  of  the  Union  requires  the  existence  of  a  functioning  market  economy  and  the 
capacity  to  cope  with  competitive  pressure  and  market  forces  within  the  Union.  The  period 
the Commission took into consideration run up to end of September. 

3.1. 

The existence of a functioning market economy 

Economic policy essentials 

Turkey  broadly  implemented  the  economic  policy  agreed  with  the  Commission  and  with 
international financial institutions and successfully completed the stand-by arrangement with 
the  International  Monetary  Fund  (IMF)  in  May  2008.  The  pre-accession  economic 
programme  submitted  to  the  Commission  in  December  2007  adequately  reflected  the  needs 
for, and commitments to, further reform. At times, the domestic political crisis hampered the 
decision-making  process  with  regard  to  reforms.  The  fragmentation  of  responsibilities 
between  government  bodies  has  been  partly  addressed  in  the  new  government's  programme 
by assigning the role of coordinating economic policy to a Deputy Prime Minister. However, 
coordination of budgeting and medium-term economic policy-making has so far only partially 
benefited. Decisions sometimes appear to be taken on an ad hoc basis and impact assessments 
are  either  lacking  or  based  on  partial  information.  In  conclusion,  consensus  on  economic 
policy essentials has been maintained and coordination has improved.  

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Macroeconomic stability 

In  2007,  GDP  growth  slowed  down  to  4.6%  from  6.9%  one  year  earlier,  mainly  due  to 
contraction in agriculture and weaker aggregate demand. There was a slowdown or stagnation 
in many sectors of the economy from construction to textiles, while agriculture was severely 
hit  by  a  drought.  Private  consumption  growth  remained  weak  in  2007  growing  by  3.8%,  in 
spite of a strong surge (up 6.3%) in the third quarter. The public sector purchased significantly 
lower  volumes  of  goods  and  services  and  markedly  reduced  construction  after  sizeable 
spending increases in these areas in the run-up to the July 2007 elections. The contribution of 
the external sector to growth fell substantially, as imports grew by 14.4% and 15.7% year-on-
year in the third and fourth quarters respectively, while export growth was 2.5% in the fourth 
quarter,  down  from  12.5%  in  the  first  quarter  of  2007.  The  slowdown  in  domestic  demand 
was triggered mainly by a tighter monetary stance, higher interest rates and lower lending. 

In the first half of 2008, the economy slowed down, due to the global financial turbulence and 
the  domestic  political  uncertainty,  and  GDP  grew  by  4.2%.  GDP  growth  slowed  down  to 
1.9% in the second quarter of 2008 from 6.7% in the first. Agriculture contracted by 3.5% in 
the second quarter after output had increased by 2.6% in the first quarter. Final consumption 
of  households  lost  steam  in  the  second  quarter,  as  expenditure  rose  by  2.8%  after  a  7.6% 
increase  in  the  first.  In  March  2008,  the  GDP  methodology  was  aligned  with  the  European 
System  of  Accounting  (ESA95).  Consequently,  one  third  was  added  to  the  size  of  the 
economy,  which  resulted  in  a  2006  GDP  of  more  than  TRY  750bn  (about  EUR  380bn). 
Although  economic  growth  has  slowed  down,  due  to  a  combination  of  weaker  aggregate 
demand  and  higher  uncertainty  linked  to  the  global  financial  crisis  and  domestic  political 
developments,  overall  economic  performance  demonstrated  that  the  foundations  and 
resilience of the Turkish economy are substantially stronger today than some years ago. 

The  thorough  revision  of  Turkey's  national  accounts  in  March  2008  reduced  the  current 
account deficit relative to GDP by one third to more benign levels. The sharp rise in oil prices 
has been putting pressure on Turkey's current account. This has become more pronounced in 
recent months as oil prices have soared to record levels. The current account deficit in the first 
half of 2008 totalled about 6.3% of GDP, compared with 5.7% in 2007 and 6.2% in 2006. The 
same indicator, excluding energy, was below 2.8% throughout the period. This pointed to a 
trade deficit of about 7% in the first half of 2008. As in previous years, over one third of the 
gap is covered by services, mainly tourism, which performed better in 2007 and 2008 than in 
2006.  On  the  capital  account,  capital  inflows  have  more  than  funded  the  current  account 
deficit, leading to an increase in official reserves. Recently almost 40% of the current account 
deficit has been financed by foreign direct investment (FDI) and the remainder by long-term 
inflows, comprising long-term external borrowing by the private corporate sector and banks. 
The  share  of  portfolio  investments  declined  significantly  and  became  negative  from  March 
2008  on.  FDI  inflows  totalled  3%  of  GDP  in  2007  and  2%  in  the  first  half  of  2008.  The 
services  sector  (mainly  banks  and  telecommunications)  accounted  for  almost  two  thirds  of 
total  FDI.  Turkey's  external  debt  rose  by  almost  20%  in  nominal  terms  to  roughly  45%  of 
GDP  by  mid-2008.  Private  external debt  makes  up  two  thirds  of  the  total  and  is  rising  fast, 
which is a source of potential risk. International reserves increased by over 15% to EUR 47 
billion,  or  about  six  months  of  imports.  Although  higher  oil  and  commodities  prices  put 
pressure on Turkey's current account, long-term capital inflows remained high, leading to an 
increase  in  official  reserves.  Turkey's  external  position  remained  solid  throughout  2007  and 
the first half of 2008. 

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So far (by mid-October 2008), the global financial crisis has caused a correction in Turkish 
asset prices and in the currency, which could also lead to further output losses and inflationary 
pressures. The impact on the Turkish banking system has remained limited so far, largely due 
to  previous  restructuring  measures  and  comfortable  prudential  indicators.  However, 
considerable  external  financing  needs  stemming  from  large  external  deficits  in  combination 
with  the  private  sector's  significant  reliance  on  external  financing  and  a  sizeable  -  albeit 
falling - debt stock make Turkey potentially vulnerable to changes in investor sentiment. The 
quality  of  financing  of  the  current  account  deficit  has  deteriorated,  gradually  moving  away 
from  equity  investment  towards  debt  accumulation.  The  close  cooperation  amongst  Turkish 
financial authorities as well as with the international and European financial institutions, the 
existence of strong prudent regulations, the implementation of restrictive monetary and fiscal 
policies as well as the continuation of structural reforms are providing a stabilising effect to 
financial markets and the economy. 

Labour  market  conditions  remained  challenging.  The  working-age  population  increased  by 
over  700,000  in  2007.  Fewer  than  300,000  of  them  joined  the  workforce;  the  rest  remained 
outside the labour market. Consequently, the employment rate hovered around 43% in 2007-
2008.  In  particular,  the  female  employment  rate  remained  low  at  less  than  24%  of  the  total 
working-age  population.  The  unemployment  rate  remains  between  10%  and  11%. 
Unemployment  was  much  higher  among  the  young  (about  20%).  Long-term  unemployed 
accounted  for  more  than  half  of  job-seekers.  Agriculture  typically  employs  many  unpaid 
family  workers.  This  leads  to  a  statistically lower  rate  of  unemployment,  but  suggests  large 
pockets of underemployment in this sector and the economy at large. Job creation continued 
to  be  hampered,  in  part,  by  labour  market  rigidities  (for  example,  high  severance  payments 
and the sizeable social security wedge), by the skills mismatch between labour demand and 
supply  and  by  the  cost  of  hiring  and  firing.  Overall,  labour  continues  to  act  as  a  brake  on 
employment. 

Annual inflation rose to 8.4% by the end of 2007 and to 10.6% by mid-2008, well above the 
inflation target, partly due to soaring food and energy prices. Excluding unprocessed food and 
energy,  underlying  inflation  rose  to  10.4%  in  mid-2008,  a  four-year  high,  depreciated 
substantially vis-à-vis the euro in September and October 2008. The Central Bank maintained 
the formal inflation targeting policy adopted in January 2006, but chose to raise its inflation 
targets in June 2008 in an effort to anchor inflationary expectations more firmly. At the same 
time, the Central Bank decided to raise rates by a cumulative 150 base points, after having cut 
them  by  225  base  points  in  the  course  of  2007  and  early  2008.  It  has  also  announced  a 
tightening bias with the aim of fighting second-round effects on prices. This action was seen 
as a reaffirmation of the independence of the Central Bank and a strong signal of its continued 
commitment  to  fighting  inflation.  Credit  to  the  private  sector  remained  broadly  constant  on 
around  30%  of  GDP  and  is  therefore  not  seen  as  a  significant  threat  to  price  stability.  In 
conclusion, price stability has weakened significantly over the last year, partly due to external 
factors. 

Fiscal  performance  has  been  satisfactory,  although  the  government  missed  its  2007  fiscal 
targets. Public debt (ESA95 definition) fell from 46.1% of GDP in 2006 to 38.8% in 2007 and 
is  expected  to  continue  to  fall  over  the  medium  term,  improving  fiscal  sustainability.  The 
2007 primary surplus – which excludes interest payments – equalled 3.5% of GDP (ESA95 
methodology),  down  from  5.5%  in  2006.  In  June  2008,  the  authorities  announced  the 
introduction of a five-year (2008-2012) medium-term fiscal framework (MTFF), which offers 
good visibility over the government's medium-term fiscal strategy. The MTFF seeks to reduce 
public debt from around 39% in 2007 to 30% in 2012. This is to be achieved by means of a 

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primary  surplus  of  3.5%  in  2008  (unchanged  compared  with  2007),  declining  to  2.4%  in 
2012.  The  overall  deficit  is  projected  to  remain  below  1.7%  over  the  five-year  period.  The 
fiscal  space  gained  from  reducing  debt  service  is  to  be  used  to  finance  three  major  policy 
initiatives:  an  employment  package  and  social  security  reform,  the  South  Anatolian  project 
(mainly infrastructure investment) and decentralisation to municipalities. Fiscal targets for the 
first half of 2008 have been met, in large part due to the higher – mainly tax – revenue which 
kept pace with inflation.  

The recent depreciation of the Turkish currency caused a limited decrease in government debt 
in  the  first  few  months  of  2008.  Recent  interest-rate  increases  had  much  less  impact  on  the 
debt  stock,  which  increasingly  comprises  fixed-rate  government  securities.  However, 
domestic financial markets remain relatively shallow and the debt service dynamics are still 
closely  related  to  movements  on  global  financial  markets.  The  average  maturity  of 
government debt securities therefore fell in the first quarter of 2008 to 23.5 months, from 25.7 
months in 2007. By mid- 2008, almost 60% of total government securities were in the hands 
of banks, up by almost 2% from 2007, and thus mitigating the decline in non-residents' share. 
Completion  of  the  IMF  stand-by  agreement,  combined  with  the  perceived  uncertainty 
regarding  the  future  direction  of  economic  policy  and  the  protracted  global  financial  crisis, 
call for stronger anchoring of the fiscal position. In addition to the MTFF, introduction of a 
robust and binding fiscal rule would substantially reduce uncertainty and the vulnerability of 
Turkey's  public  finances  to  further  turbulence  on  the  financial  markets.  Overall,  fiscal 
sustainability  has  been  further  strengthened  thanks  to  a  prudent  fiscal  policy,  but  the  fiscal 
position remains vulnerable to shocks and requires stronger anchors in the face of heightened 
uncertainty and the ongoing financial crisis.  

In 2007, several coordination and control bodies were set up within the Ministry of Finance. 
Accountability,  efficiency  and  transparency  of  the  budgeting  process  have  benefited 
substantially. This is illustrated, for example, by the development of the MTFF. As last year, 
some  key  elements  are  still  lacking,  in  particular  unifying  all  tax  administration  functions 
under the Revenue Administration, strengthening audit capacity and making increased use of 
standard  risk-based  audit  techniques,  which  would  all  enhance  transparency  and  provide 
significant  support  for  anti-corruption  efforts.  Overall,  measures 
increase  fiscal 
transparency have continued.  

to 

Over  the  last  few  years,  Turkey  has  successfully  implemented  a  strong  stabilisation 
programme. Now it is entering a new stage in its development strategy aimed at raising the 
growth  potential  by  means  of  higher  public  investment,  job  creation,  structural  reforms  and 
better  education.  This  entails  a  difficult  balancing  act  between  the  desire  for  higher  growth 
and  the  need  to  maintain  price  stability  and  reduce  the  current  account  deficit.  While  the 
public debt level is no longer a major concern for fiscal sustainability and the current policy 
mix  is  broadly  adequate,  macroeconomic  stability  remains  vulnerable  to  shocks,  given  the 
wide external imbalances. Interplay of market forces 

The  independence  of  regulatory  and  surveillance  agencies  has  been  largely  preserved, 
although some imperfections persist. However, for the first time  in  several years significant 
progress was made, in particular in the area of price liberalisation. Electricity and gas prices 
were raised in January and June 2008 respectively to reflect the actual costs better. Since July 
2008, electricity prices are subject to automatic indexation. Price subsidies are being phased 
out  with  a  view  to  privatising  some  public  electricity  companies  by  the  end  of  2008. 
Administrated prices make up less than 10% of the total weight of the consumer price index 
(CPI) basket. 

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Despite its stated intention to allow State-owned firms to set their own prices, the government 
continued  to  set  prices  of  goods  produced  by  them.  The  prices  of  some  key  commodities 
produced  by  the  State  are  periodically  raised.  In  general,  the  government  sets  annual  prices 
for a range of crops. The municipalities continue to place ceilings on the retail price of bread 
and  the  Ministry  of  Health  controls  medicine  prices.  Permission  for  price  increases  has 
traditionally  depended  more  on  political  than  on  economic  criteria.  Public  institutions  and 
local authorities have large arrears with the State-owned energy company. Price liberalisation 
is  fairly  advanced  and  further  progress  has  been  made  recently.  However,  the  government 
continues to control the prices of some key commodities. 

Although  privatisation  continued,  with  a  number  of  major  operations,  the  private  sector's 
share  of  GDP  remained  virtually  constant  at  almost  89%  in  mid-2008.  The  pace  of 
privatisation  slowed  down  only  slightly  from  the  peak  years  of  2005-2006.  Between  July 
2007 and mid-2008, privatisation proceeds totalled about EUR 5 billion. Major privatisations 
included  the  sales  of  the  petrochemicals  company  Petkim  (EUR  1.4  billion),  the  State 
railways  port  facility  in  Izmir  (EUR 0.8  billion)  and  of  the  State  tobacco  company  TEKEL 
(EUR 1.2 billion) and the initial public offering of 15% of the shares in Türk Telekom (EUR 
1.3 billion). In conclusion, privatisation has advanced significantly. 

Market entry and exit 

Turkey has made efforts to improve the business climate and reduce impediments to market 
entry  and  exit.  Appreciation  for  this  has  been  voiced  by  international  experts.  The  business 
registration process was further streamlined in 2007. Legal changes were enacted to make it 
easier to obtain business and operating licences, including in the mining sector. About 55,000 
new companies were established in 2007, an increase of 5% compared with 2006. During the 
same period, roughly 10,000 firms were liquidated. Sectoral restrictions on foreign ownership 
continued  in  the  areas  of  maritime  transport,  civil  aviation,  groundhandling,  road  transport, 
radio  and  TV  broadcasting,  energy,  accountancy  and  education.  Entry  to  the  banking  and 
capital markets remained restricted to mergers and acquisitions as no new licences have been 
issued. Overall, some progress can be reported in business entry and exit. 

Legal system 

A reasonably well functioning legal system, including in the area of property rights, has been 
in  place  for  several  years.  However,  no  major  progress  has  been  made  over  the  last  year. 
Registering  a  property  takes  six  procedures  and  six  days  in  Turkey.  Enforcing  commercial 
contracts  remains  a  lengthy  process,  which  needs  36  procedures  and  takes  420  days  on 
average.  The  specialisation  of  commercial  court  judges  appears  insufficient,  leading  to 
lengthy  court  proceedings.  The  expert  witness  system  continues  to  function  as  a  parallel 
judiciary  system,  without  improving  the  overall  quality.  Use  of  out-of-court  dispute-
settlement  mechanisms  remains  low.  The  legal  environment  continues  to  pose  practical 
challenges and creates an obstacle to a better business environment. 

Financial sector development 

The  financial  sector  grew  steadily  in  2007  and  2008  and  attracted  sizeable  foreign 
investments. The total assets of the financial sector grew by 18% in 2007 and at a similar pace 
in  early  2008.  Almost  90%  of  these  assets  belong  to  banks.  The  ratio  between  the  banking 
sector's  balance  sheet  and  GDP increased  to  almost  68%  at  the  end  of  2007  compared  with 
66%  a  year  earlier.  The  ratio  of  deposits  and  loans  to  GDP  increased  by  3%  and  15% 

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respectively  in  2007,  which  demonstrates  the  continuing  financial  deepening  and  increasing 
intermediation,  channelling  more  savings  into  productive  investment.  The  efficiency  of 
financial intermediation improved slightly, as the interest rate spread narrowed by about 0.2% 
in  the  previous  year.  The  banking  sector  attracted  strong  interest  from  foreign  investors. 
Consequently,  foreign  shareholders'  share  of  the  sector's  assets  grew  to  26%  by  the  first 
quarter of 2008 from 22% in early 2007. Including shares listed at the stock exchange, almost 
45% of the Turkish banking sector is owned by foreigners.  

The  Central  Bank  made  significant  efforts  to  monitor  developments  in  the  financial  sector 
more  closely.  Liquidity  requirements  were  tightened  and  a  new  survey  was  launched  to 
monitor better both private-sector debt and the exposure of the corporate sector to exchange 
rate volatility. The delay in adoption of the new Turkish Commercial Code is hampering the 
Central Bank's risk assessment capacity, since financial statements have not been aligned with 
international  financial  reporting  standards.  More  broadly,  adoption  of  the  new  Commercial 
Code  is  a  priority,  as  it  would  significantly  improve  the  business  environment.  Banking 
profitability  ratios  improved  markedly,  by  about  one  third  in  the  year  to  December  2007. 
Capital adequacy ratios decreased significantly, albeit from very high levels, from 21.8% in 
2006 to 17.3% by March 2008. Concentration in the banking sector is at the same level as last 
year, as the five largest credit institutions' share of the banking system remained at 60% at the 
end  of  2007.  In  April  2008,  the  Banking  Regulation  and  Supervision  Agency  (BRSA) 
increased the liquidity requirements for banks in order to mitigate the increased risk stemming 
from  the  corporate  sector's  growing  foreign  exchange  borrowing.  The  net  liabilities  of  the 
non-bank  corporate  sector  in  foreign  denominations  increased  by  60%  in  the  year  to 
December  2007  to  about  EUR  45  billion  (12%  of  GDP).  The  share  of  foreign  exchange-
denominated  corporate  loans  as  a  percentage  of  the  banking  sector's  total  loans  fell  from 
almost  two  thirds  at  the  end  of  2006  to  just 56%  in early 2008. In spite  of  several  bouts of 
instability during 2007-2008 the financial sector has shown remarkable resilience. 

3.2. 

The  capacity  to  cope  with  competitive  pressure  and  market  forces  within  the 
Union 

Existence of a functioning market economy 

Macroeconomic  stability  has  been  broadly  preserved  during  the  reporting  period.  Financial 
market  turbulence  and  domestic  political  developments  added  some  uncertainty  to  the 
business  environment,  but  at  the  same  time  underlined  the  economy's  improved  shock 
resilience  so  far.  The  authorities  have  improved  the  investment  climate  by  reducing 
administrative  barriers  to  firms'  entry  and  operation,  by  reducing  and  simplifying  the  tax 
system while improving the effectiveness of the tax administration and corporate governance 
and by privatising State-owned enterprises.  

Human and physical capital  

In  2007-2008,  the  authorities  continued  to  implement  the  educational  reform  programme, 
which is part of the National Development Plan (2007-2013). This  programme  has two key 
pillars  for  education:  modernisation  and  reform.  On  the  one  hand,  it  aims  to  increase  the 
responsiveness of education to demand and, on the other, to enhance the educational system. 
The  challenges  are  significant.  The  top  students  in  Turkey  perform  well.  However,  the  gap 
with  the  vast  majority  of  Turkish  students  remains  significant.  Participation  in  higher 
education  remains  low  by  international  standards.  Around  40%  of  20-  to  24-year-olds  had 
completed  secondary  education,  but  about  ten  percent  of  school-age  children  are  still  not 

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enrolled in primary schools. Reforms and increased spending on education are having some 
positive impact on educational attainment. In 2007, enrolment rates improved at all levels of 
education, in particular for female students, but significant problems persist. 

Little progress has been made on correcting the mismatch between supply and demand forces 
on labour markets, which largely stem from the sectoral shift away from agriculture combined 
with  often  inadequate  education.  Coverage  of  the  population  eligible  for  unemployment 
benefit is limited by rigid eligibility conditions. In May 2008 the government adopted a new 
employment  package,  which  provides  incentives  to  employ  young  workers,  women  and 
people with disabilities. The package aims to reduce non-financial burdens and social security 
contributions,  which  had  acted  as  a  disincentive  to  formal  employment.  In  particular,  the 
package  reduces  employment  costs  for  five  years  for  newly  employed  people  in  the  above-
mentioned  categories.  However,  it  does  not  affect  other  barriers  which  complicate  job 
creation,  for  example  the  very  high  severance  payments.  The  Turkish  Employment  Agency 
continued  its  efforts  to  improve  its  institutional  capacity  and  the  services  provided  to  job-
seekers. Turkey declared 2008 the year for combating undeclared work. Overall, the situation 
on  the  labour  market  remains  challenging,  but  a  set  of  broadly  adequate  reforms  have  been 
tabled. 

Both  domestic  and  foreign  investments  remain  robust.  Private  gross  fixed  capital  formation 
grew  by  around  5%  in  2007  and  in  the  first  half  of  2008.  Private  capital  formation  totalled 
around 17% of nominal GDP. FDI inflows decreased to 3% of GDP in 2007 and 2% of GDP 
in the first half of 2008. Around 80% of these FDI inflows were equity investment and around 
20% real estate purchases. As a result, the FDI stock stood at EUR 53.7 billion (about 15% of 
GDP), of which about one quarter was due to 2007 inflows. Most of the equity investments in 
2007  were  in  financial  services  (60%)  and  manufacturing  (20%).  Investment  growth 
weakened, albeit from very high levels. 

For  many  years  infrastructure  investment  has  been  hampered  by  the  need  to  consolidate 
public  finances  and  the  failure  to  cut  lower-priority  spending.  Inadequate  infrastructure  is 
increasingly  affecting  economic  activity.  Therefore,  the  government  adopted  a  spending 
programme, which aims at releasing about TRY 17 billion (EUR 8.7 billion) for investment in 
infrastructure in the South-eastern Anatolia region between 2008 and 2012. In addition, extra 
power-generating  capacity  is  planned  in  order  to  keep  pace  with  the  rapidly  growing 
electricity consumption (7% on average in each of the past five years). The new government's 
initiatives  aim  at  boosting  investment  in  infrastructure.  Also,  the  EBRD  shareholders  have 
recently decided that the Bank should start operating in Turkey, a decision that was supported 
by the Commission and the EU shareholders. The EBRD's support will contribute to Turkey's 
further  development  and  reform  programme.  The  EBRD  can  support  the  development  of  a 
more open and entrepreneurial economy by promoting growth of small businesses, supporting 
the  Turkish  government's  privatisation  programme,  bringing  private  sector  financing  and 
know-how to the provision of public services. 

Sectoral and enterprise structure 

The  share  of  agriculture  in  employment  fell by  about  1  percentage  point  to  26.5%  in  2007. 
Most jobs were created in the services sector. The share of services in the total labour force 
rose  to  48%.  Employment  in  industry  and  construction  accounted  for  roughly  20%  and  6% 
respectively. The relative size of agriculture in GDP fell from 8.3% in 2006 to 7.7% in 2007. 
Industry's  (including  construction)  contribution  to  GDP  remained  stable  at  roughly  31%, 

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while  services  generate  about  60%  of  national  income.  The  sectoral  shift  away  from 
agriculture towards services has continued. 

SMEs account for 99% of all enterprises in Turkey and 77% of total employment. However, 
SME ratios for capital investment (38% of the total), value added (26.5%), exports (10%) and 
bank credit (5%) point to low labour productivity, insufficient access to finance and barriers 
to  entering  foreign  markets.  Informality  is  widespread  throughout  all  corporate  sectors,  but 
particularly amongst SMEs. Small enterprises continue to suffer from insufficient managerial 
capacity  and  a  too  small  knowledge  base  to  cope  with  the  increasing  competition  on  the 
markets. To sum up, SMEs continue to have insufficient access to finance and know-how and 
too often operate in the grey economy. 

Restructuring  was  supported  by  privatisation  in  some  areas,  such  as  telecommunications. 
Progress has been made on restructuring and preparing for privatisation in the energy sector, 
where  the  main  outstanding  problems  are  related  to  cross-subsidies  and  large  distribution 
losses. In the private sector, strong productivity gains indicate that the restructuring process 
has been largely successful. Overall, the process of structural transformation of the economy 
has advanced relatively well, mainly in the form of privatisation. 

State influence on competitiveness 

Transparency  in  the  corporate  sector  has  improved  and  accounting  standards  have  been 
upgraded,  although  the  new  Commercial  Code  has  not  yet  been  adopted.  The  absence  of 
transparent  monitoring  of  State  aid  and  of  supporting  policies  to  reduce  distortion  has  an 
adverse  effect  on  competition  and  competitiveness  in  the  economy.  Public  procurement 
policies continue to be undermined by exceptions to the regulatory framework. In addition, a 
number of derogations have been introduced by sectoral laws, which has further limited the 
scope  of  the  law.  Overall,  State  intervention  continues  to  influence  competition  and 
competitiveness considerably, although the State's role as an active player on the markets is 
being further reduced. 

Economic integration with the EU 

Turkey's trade openness has increased marginally. Exports and imports of goods and services 
totalled 60% of GDP in 2007. The share of exports to the EU increased slightly from 56.0% in 
2006 to 56.4% in 2007. Imports from the EU as a share of total imports declined, from 42.6% 
to  40.4%,  mainly  due  to  the  rising  import  bill  for  energy,  which  Turkey  imported  almost 
exclusively  from  non-EU  countries.  Investors  from  EU  Member  States  continued  to  invest 
heavily in Turkey, though at a slower pace. About two thirds of all FDI inflows recorded in 
2007  originated  from  EU  Member  States,  down  from  82%  in  2006.  In  the  first  quarter  of 
2008,  the  share  of  FDI  flows  from  the  EU  fell  further  to  53%.  In  2007,  GDP  per  capita  in 
Turkey stood at 43.3% of the EU-27 average. The EU remains Turkey's largest trading and 
investment partner. 

4. 

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP 

This section examines Turkey’s ability to assume the obligations of membership – that is, the 
acquis as expressed in the Treaties, the secondary legislation, and the policies of the Union. It 
also  analyses  Turkey’s  administrative  capacity  to  implement  the  acquis.  The  analysis  is 
structured  in  accordance  with  the  list  of  33  acquis  chapters.  In  each  sector,  Commission's 

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assessment  covers  progress  achieved  during  the  reporting  period,  and  summarises  the 
country's overall level of preparations.  

4.1. 

Chapter 1: Free movement of goods 

Some  progress  can  be  reported  with  alignment  on  the  general  principles  applicable  to  free 
movement of goods. The communiqué on standardisation in foreign trade, applicable in 2008, 
further  reduced  the  list  of  items  subject  to  conformity  assessment  upon  import  to  100  from 
about 150 in 2007. For the first time, all 20 communiqués regarding standardisation in foreign 
trade  were  published  together  at  the  beginning  of  2008.  This  provided  a  consolidated 
overview  of  the  standardisation  and  licensing  requirements  for  imports  into  Turkey,  which 
was helpful to traders as import checks and licensing are carried out by five different public 
authorities.  Mandatory  standards  on  gas  appliances,  pressure  equipment,  batteries  and 
chemicals used in batteries were abolished. In principle, products in free circulation in the EU 
and  bearing  the  “e”,  “E”  or  “CE”  marking  are  exempted  from  conformity  assessment 
procedures. 

However,  technical  barriers  to  trade  still  exist,  in  particular  in  the  area  of  old  approach 
directives  such  as  on  legal  metrology,  pharmaceuticals,  chemicals  and  foodstuffs.  There  are 
limitations  to  the  free  circulation  of  goods  in  the  non-harmonised  areas,  as  Turkey  has  not 
introduced the mutual recognition principle. Licences are still necessary for goods considered 
old, renovated or faulty and second-hand motor vehicles. 

As  regards  horizontal  measures,  further  progress  can  be  reported  on  standardisation. 
Adoption of European standards by the Turkish Standards Institute (TSE) gained pace. So far 
the  TSE  has  adopted  a  total  of  11 048  standards  of  the  European  Committee  for 
Standardisation  (CEN),  3 725  standards  of  the  European  Committee  for  Electro-technical 
Standardisation  (CENELEC)  and  336  standards  of  the  European  Telecommunication 
Standards Institute (ETSI). The overall rate of harmonisation with EN standards rose to 97.4% 
from  more  than  90%  last  year.  The  restructuring  of  the  TSE  continued  and  it  has  been 
reinforced with a separate standards preparation centre, 89 operational committees and a clear 
separation  of  its  various  tasks.  However,  a  revised  law  reflecting  the  new  structure  of  the 
TSE, in accordance with the requirements for full membership of the CEN and CENELEC, 
has yet to be adopted. 

As regards conformity assessment, further progress was made in the area of notified bodies. 
There  are  six  Turkish  notified  bodies,  operating  in  the  areas  of  lifts,  appliances  burning 
gaseous fuels, construction products (cement), pressure vessels and recreational craft. 

Further  progress  can  be  reported  regarding  accreditation.  Following  the  signature  of  four 
European  Accreditation  Cooperation  (EA)  multilateral  agreements  (MLA)  last  year,  the 
outcome of EA assessment of the Turkish Accreditation Agency (TURKAK) in the fields of 
certification of products and persons has been positive. TURKAK is already a member of the 
International  Accreditation  Forum  (IAF)  and  has  a  mutual  recognition  agreement  with 
International  Laboratory  Accreditation  Cooperation  (ILAC).  The  number  of  TURKAK 
accreditations  rose  to  246,  an  increase  of  13%  since  last  year.  TURKAK  has  become  the 
monitoring authority for good laboratory practice, following signature of a protocol between 
the  designating  ministries  and  TURKAK.  The  revised  law  aiming  at  further  harmonising 
TURKAK’s structure with the European accreditation system has not yet been adopted.  

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Limited progress has been made in the area of metrology. An amending regulation on the type 
approval  of  measures  and  measuring  instruments  was  adopted  and  published  in  the  Turkish 
Official Gazette on 6 November 2007. Measuring instruments remain a problematic area, with 
excessive requirements on service stations that need to be established prior to import. Turkey 
is  now  able  to  affix  its  own  TR  sign  for  initial  verification  of  measuring  instruments  in 
accordance with the relevant EU directive. 

Limited progress on market surveillance can be reported. Some public authorities, including 
the  telecommunications  authority,  the  Ministry  of  Health  and  the  Ministry  of  Industry  and 
Trade, published revised regulations on the method and principles of their market surveillance 
systems.  In  the  cases  of  the  telecommunications  authority  and  the  Ministry  of  Health,  the 
amendments  are  of  minor  importance  and  further  clarify  earlier  texts.  The  new  regulation 
from the Ministry of Industry and Trade replaced the 2003 text and contains specifications on 
the  qualifications  and  training  of  inspectors.  It  also  provides  for  a  single  inspection  report 
template  and  includes  sections  on  the  principles  of  market  surveillance,  measures  to  be 
imposed,  powers  and  obligations  and  coordination.  The  Under-secretariat  of  Foreign  Trade 
increased  the  administrative  fines  for  violation  of  the  Framework  Law  regarding  technical 
legislation  on  products,  which  lays  the  foundation  for  market  surveillance,  by  7%  in  2008. 
The  fines  have  almost  tripled  since  the  law  was  published  in  2002.  However,  there  are  no 
reliable  data  on  the  sanctions  and  fines  imposed  by  the  ministries  concerned.  The  skills  of 
relevant  personnel  in  the  Ministry  of  Industry  and  Trade,  the  Ministry  of  Health  and  the 
Ministry of Public Works and Settlement have been considerably enhanced. The Ministry of 
Industry  and  Trade  and  the  Ministry  of  Health  increased  considerably  their  market 
surveillance  activities  in  2007  as  compared  with  2006.  However,  the  operational  budgets 
allocated  for  market  surveillance  remain  too  small.  Generally,  considering  the  size  of  the 
country,  more  extensive  surveillance  activities  are  required,  taking  into  account  visibility 
considerations  and  risk  assessment  principles.  Continuous 
to  be 
institutionalised  in  order  to  maintain  the  benefits  of  the  recently  acquired  knowledge.  A 
common  method  for  data  gathering  has  still  not  been  achieved.  Coordination  between 
surveillance  agencies  remains  problematic,  including  automated  exchanges  of  information. 
The consumer movement needs support if market surveillance is to become really effective. 

training  remains 

Alignment  of  horizontal  measures  is  advanced.  However,  the  effective  implementation  of 
market  surveillance,  the  adoption  of  final  legislative  changes  on  standardisation  and 
accreditation, and the alignment in the area of legal metrology have all been delayed. 

Alignment  of  product  legislation  adopted  under  the  old  approach  is  advanced.  Further 
progress was made on motor vehicles by amending existing and introducing new legislation. 
The Ministry of Trade and Industry has published a transposing regulation regarding the type 
approval  of  agricultural  or  forestry  tractors,  their  trailers  and  other  interchangeable  towed 
machinery.  The  Ministry  of  Health  published  amending  legislation  on  the  pricing  of 
pharmaceuticals  and  on  the  pre-packaging  and  labelling  of  pharmaceuticals  for  human  use. 
The  latter  launched  a  pharmaceuticals  tracking  system  to  fight  against  counterfeit  products. 
The  problem  regarding  regulatory  data  protection  and  the  authorisation  system  for  generics 
for which a marketing authorisation was applied for before 1 January 2005 has still not been 
solved.  The  double  import  licensing  obligation  for  alcoholic  beverages  has  ended,  after  the 
import permission procedure of the Tobacco and Alcoholic Beverages Regulatory Authority 
was converted into a notification requirement. The control certificate and obligatory sampling 
requirement by the Ministry of Agriculture is still a cause for concern. 

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Limited  progress  has  been  made  on  the  new  and  global  approach  product  legislation,  as 
alignment  in  this  area  was  already  advanced.  Full  alignment  on  four  more  directives  was 
verified  during  the  reporting  period,  following  the  20  directives  verified  last  year.  The 
Ministry of Industry and Trade transposed the revised electromagnetic compatibility directive. 
The  new  regulations  will  enter  into  force  in  December  2009.  The  Ministry  of  Industry  and 
Trade also transposed the directive on efficiency requirements for new hot-water boilers fired 
with  liquid  or  gaseous  fuels.  Harmonised  standards  on  recreational  craft  were  published  in 
October  2007.  Amendments  were  made  to  the  legislation  on  toys  and  childcare  articles 
containing  certain  phthalates  and  intended  to  be  placed  in  the  mouth  by  children.  The  new 
provisions transpose Directive 2005/84/EC. 

Regarding  procedural  measures,  no  progress  can  be  reported.  No  provisions  to  align  with 
Regulation  339/93  have  been  adopted.  However,  the  Under-secretariat  of  Foreign  Trade  is 
implementing  the  directives  on  radio  and  telecommunication  terminal  equipment,  toys, 
personal protective equipment, construction products, batteries and medical devices, based on 
standardisation in foreign trade communiqués. Products that have to bear the CE marking and 
entering Turkey from third countries are subject to checks by the TSE upon import. There has 
been no progress on cultural goods and firearms. 

There has been no progress in the non-harmonised area. The mutual recognition principle, a 
key element for this chapter, has not yet been introduced into the Turkish trade regulations. 

“Free movement of goods” is one of the eight chapters covered by the conclusions on Turkey 
adopted by the Council (General Affairs and External Relations) on 11 December 2006 and 
endorsed by the European Council on 14/15 December 2006. As long as restrictions remain in 
place on the free movement of goods carried by vessels and aircraft registered in Cyprus or 
where the last port of call was Cyprus, Turkey will not be in a position fully to implement the 
acquis relating to this chapter. 

Conclusion 

Some  progress  can  be  reported  in  this  chapter.  Alignment  of  product  legislation  and 
horizontal  measures,  except  on  market  surveillance  and  legal  metrology,  is  advanced. 
Effective  market  surveillance  activities  are  needed, 
into  account  visibility 
considerations  and  risk  assessment  principles,  including  coordination  between  surveillance 
agencies.  Some  key  issues  for  this  chapter,  such  as  identifying  and  abolishing  remaining 
import licences, restrictions on the import of used motor vehicles, introduction of the mutual 
recognition  principle  into  Turkish  legislation  and  transitional  issues  connected  with 
application of regulatory data protection for pharmaceutical products are yet to be solved. 

taking 

4.2. 

Chapter 2: Freedom of movement for workers 

With regard to access to the labour market, legislation on work permits for foreigners that 
eased procedures and exempted certain professionals from obtaining work permits, including 
people  working  on  national  and  international  projects,  was  vetoed  and  is  still  before 
Parliament. 

Efforts  to  strengthen  the  capacity  of  the  Turkish  Employment  Agency  (ISKUR)  continued. 
These concerned, in particular, IT infrastructure and training to allow job-matching services 
in  an  electronic  environment.  Further  efforts  are  needed  to  prepare  for  participation  in  the 
EURES (European employment services) network. 

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With regard to co-ordination of social security systems, efforts to build the administrative 
capacity of the Social Security Institution continued. Appointment of medium- and high-level 
managers  at  central  and  provincial  level  also  contributed  to  consolidation  of  the  (Social 
Security)  Institution.  The  efforts  to  build  “one-stop-shop”  social  security  centres  in  districts 
are continuing. 

There  have  been  no  developments  as  regards  preparations  for  the  introduction  of  the 
European Health Insurance Card. 

Conclusion 

Overall, limited progress has been made. Alignment is at an early stage. The administrative 
capacity needs to be strengthened further. 

4.3. 

Chapter 3: Right of establishment and freedom to provide services 

Limited progress can be reported on right of establishment and freedom to provide services. 

As  regards  freedom  of  establishment,  Turkey  still  has  not  provided  a  detailed  alignment 
strategy on this chapter, as required under the Accession Partnership. Gender, nationality and 
residence  requirements,  but  also  disproportionate  language  and  other  requirements,  such  as 
the one-office rule for pharmacists, continue to be incompatible with the acquis. 

No new developments can be reported as regards freedom to provide cross-border services. 
Registration,  licence  or  authorisation  requirements  continue  to  be  incompatible  with  the 
acquis in this specific area. Firms already established in a Member State are still subject to 
specific  registration  and  authorisation  requirements.  The  same  applies  to  service  providers, 
who have to fulfil particular requirements in order to obtain the necessary work and residence 
permits. 

Work  to  identify  obstacles  to  exercising  the  right  of  establishment  and  freedom  to  provide 
services has not yet started. No steps have been taken to establish the structure needed for that 
purpose. Alignment in the fields of establishment and services is at an early stage. 

No  progress  can  be  reported  in  the  field  of  postal  services.  The  legal  monopoly  (reserved 
area) regardless of weight limits is still intact. No independent regulatory authority exists in 
the  sense  of  the  acquis.  The  accounting  system  still  lacks  transparency  for  want  of  an 
appropriate  accounting  method  for  reserved  and  non-reserved  services  and  of  separation  of 
accounts. 

Some  progress  can  be  reported  in  the  area  of  mutual  recognition  of  professional 
qualifications.  A  regulation  on  harmonisation  of  the  minimum  training  requirements  for 
regulated  professions  (medicine,  nursery,  midwifery,  dentistry,  veterinary  medicine, 
pharmacy and architecture) has been adopted and published in the Official Gazette, with the 
aim of aligning with Directive 2005/36. The Vocational Qualifications Authority (VQA) has 
taken further steps towards becoming operational, including recruitment of staff and adoption 
of several regulations on staff and working methods. This should allow the authority shortly 
to develop standards on the professions which will fall under its remit. However, the principle 
of  reciprocal  recognition  is  still  applied  to  a  number  of  regulated  professions  whereas 
automatic  recognition  is  the  general  rule  under  the  acquis.  Various  requirements  based  on 
nationality and  language criteria persist. Discrimination  based  on gender also persists in the 
area of midwifery. Despite a cross-reference to the midwife profession in the recently adopted 

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Law  on  nurses,  male  students  are  still  not  entitled  to  attend  midwife  schools.  No  procedure 
has been set up to allow distinctive recognition of professional and academic qualifications, 
whereas  the  current  administrative  structures  allow  recognition  of  foreign  qualifications  at 
academic level only. Turkey still needs to designate a contact point as part of implementation 
of Directive 2005/36 on the recognition of professional qualifications. 

“Right of establishment and freedom to provide services” is one of the eight chapters covered 
by  the  conclusions  on  Turkey  adopted  by  the  Council  (General  Affairs  and  External 
Relations) on 11 December 2006 and endorsed by the European Council on 14/15 December 
2006.  As  long  as  restrictions  remain  in  place  on  the  free  movement  of  goods  carried  by 
vessels and aircraft registered in Cyprus or where the last port of call was Cyprus, Turkey will 
not be in a position to fully implement the acquis relating to this chapter. 

Conclusion 

Alignment  in  the  area  of  services  and  establishment  is  still  at  an  early  stage.  The  legal 
groundwork  in  the  field  of  postal  services  still  needs  to  be  launched.  Alignment  with 
Community law on the mutual recognition of professional qualifications is progressing slowly 
but at a steady pace. 

4.4. 

Chapter 4: Free movement of capital 

Some  progress  has  been  made  on  capital  movements  and  payments.  An  out-of–court 
dispute settlement mechanism for customer complaints (the “Arbitration Panel for Customer 
Complaints”)  has  been  established  under  the  sectoral  association.  This  collegiate  body  now 
needs  to  demonstrate  independent  decision-making.  Some  progress  can  be  reported  on 
transactions in the area of securities, instruments other than securities and foreign currencies. 
The Capital Markets Board abolished the maximum limit on investments by pension funds in 
foreign  securities.  The  Board  also  removed  the  minimum  requirement  for  private  pension 
funds  to  invest  in  Turkish  government  debt  instruments  by  amending  the  Regulation  on  the 
principles  regarding  the  establishment  and  activities  of  pension  funds.  The  Council  of 
Ministers amended the Decree on protection of the value of Turkish lira and abolished several 
restrictions. Following this amendment, residents in Turkey are now entitled to buy and sell 
foreign currency from and to institutions which are authorised to do so in other countries. The 
amendment also entitles Turkish residents to purchase capital market instruments other than 
securities  (e.g.  derivatives)  from  abroad.  Export  revenue  no  longer  has  to  be  converted  into 
Turkish  lira.  The  corresponding  decree  entitles  the  Ministry  in  charge  of  the  Treasury  to 
entrust other institutions with execution of foreign currency transactions in Turkey and with 
extension  of  foreign  currency  denominated  loans  abroad.  However,  residual  exchange 
controls remain on certain significant outward capital movements (i.e. foreign consumer and 
real  estate  credits  to  Turkish  residents)  which  are  considered  by  Turkey  to  have  possible 
macroeconomic implications. 

The  Turkish  legislation  in  the  field  of  real  estate  acquisition  by  foreigners  is  not  fully 
consistent with Article 56 of the Treaty establishing the European Community. Acquisition of 
real  estate  by  foreign  physical  and  legal  persons  (established  in  other  countries)  has  been 
regulated by the Land Registry Law. Foreign capital companies (established in Turkey) were 
subject  to  different  arrangements  for  real  estate  acquisition  which  was  regulated  by  the 
Foreign  Direct  Investment  Law.  In  January  2008  the  Constitutional  Court  overruled  some 
provisions of the Land Registry Law on real estate acquisition by foreign physical and legal 
persons.  In  April  2006  the  same  court  cancelled  some  provisions  of  the  Foreign  Direct 

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Investment Law on real estate acquisition by foreign capital companies. To fill the legal gap, 
in  July  2008  the  Turkish  Grand  National  Assembly  enacted  a  Law  amending  the  Land 
Registry Law. The new law takes into account the views expressed by the court in both the 
above-mentioned  decisions  and  regulates  the  arrangements  on  real  estate  acquisition  by 
foreign physical and legal persons and foreign capital companies. Under the new law, foreign 
physical  persons  can  acquire  real  estate  for  residence  or  business  up  to  certain  area  limits, 
while  foreign  capital  companies  established  according  the  Foreign  Direct  Investment  Law 
may acquire real estate in Turkey to conduct business in accordance with the activities listed 
in  their  articles  of  association.  Foreign  capital  companies  are  legally  considered  as  Turkish 
companies,  regardless  of  the  citizenship  of  their  shareholders.  Authorities  also  issued  an 
implementing  regulation  requiring  foreign  capital  companies  to  get  the  approval  of  the 
military chief of staff and the provincial governor when purchasing immovable property. 

Restrictions on foreign direct investment originating from the EU persist in a large number of 
sectors, such as maritime transport, civil aviation, ground handling, road transport, radio and 
TV broadcasting, energy, accountancy and education. A number of the restrictions depend on 
participation  by  Turkey  in  the  relevant  EU  sectoral  policies  (in  particular,  in  the  area  of 
transport).  Little  tangible  progress  has  been  made  with  free  movement  of  capital  in  these 
various sectors to date.  

Turkey  needs  further  to  align  its  payment  systems  legislation  with  the  acquis,  as  outlined 
under the Accession Partnership. 

Some  progress  has  been  made  in  the  fight  against  money  laundering.  A  number  of 
implementing regulations have come into force, which supplement the Law on the prevention 
of  laundering  proceeds  of  crime.  Those  implementing  regulations  relate  to  reporting 
suspicious  transactions  with  regard  to  financing  of  terrorism,  customer  due  diligence, 
extension  of  obliged  parties  to  lawyers  and  accountants,  simplified  customer  identification 
measures  in  the  necessary  cases  and  the  working  principles  and  procedures  of  the 
Coordination  Board  for  Combating  Financial  Crime.  Turkey  made  a  number  of  legislative 
amendments  in  order  to  prohibit  those  criminalised  as  a  result  of  laundering  of  proceeds  of 
crime and financing of terrorism from becoming founders, partners or managers in exchange 
offices,  investment  funds,  capital  markets  brokerage  houses,  precious  metals  brokerage 
houses and real estate investment partnerships. 

Turkey  signed  Memoranda  of  Understanding  with  five  countries  on  information  exchange 
(Indonesia, Sweden, Portugal, Mongolia and Afghanistan). A special unit has been established 
in  the  Financial  Crimes  Investigation  Board  (MASAK)  to  fight  financing  of  terrorism.  A 
general communiqué regarding the reporting of suspicious transactions and terrorist financing 
has been adopted. A regulation on measures to prevent laundering of proceeds of crime and 
terrorist financing has also been adopted, including measures on customer due diligence. The 
number  of  reports  of  suspicious  transactions  to  MASAK  increased  from  1 140  in  2006  to 
2 946 in 2007, mostly originating from the banking sector. Similarly, the number of reports of 
suspicious transactions with regard to financing terrorism increased from 8 in 2006 to 144 in 
2007.  In  2007,  43  dossiers  were  referred  by  MASAK  to  the  public  prosecutors  office  for 
prosecution as compared with 39 in 2006. 22 of those resulted in the opening of cases before 
courts  in  2007  as  compared  with  27  in  2006.  However,  convictions,  confiscations,  seizures 
and freezing of assets have remained quite rare up until now. 

The lack of effective enforcement capability and implementation mechanisms remains a cause 
of concern. MASAK provided training for bank staff, judges and prosecutors, finance and tax 

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inspectors,  obliged  parties  and  other  relevant  enforcement  bodies.  However,  MASAK’s 
resources are still insufficient and the skill levels of the judiciary and law enforcement bodies 
are  not  considered  adequate.  Turkey  has  not  yet  ratified  the  2005  Council  of  Europe 
Convention on laundering, search, seizure and confiscation of the proceeds from crime and on 
the  financing  of  terrorism.  Deficiencies  identified  in  the  report  on  the  third  review  by  the 
Financial  Action  Task  Force  (FATF)  will  be  discussed  in  the  FATF  plenary  meeting  in 
February 2009. They still need to be properly addressed. 

Overall, Turkey has made further progress as regards alignment with the acquis on the fight 
against money laundering and financing of terrorism. 

Conclusion 

There  has  been  some,  albeit  uneven,  progress  on  this  chapter.  The  maximum  limit  on 
investments by private pension funds in foreign securities has been removed. Restrictions on 
the  use  of  export  proceeds  and  on  foreign  currency  transactions  have  been  abolished. 
Restrictions  on  free  movement  of  capital  persist  in  various  sectors  of  the  economy.  The 
Parliament  enacted  an  amending  law  regulating  the  acquisition  of  real  estate  by  foreign 
physical  and  legal  persons  and  by  foreign  capital  companies.  Turkey  made  further  progress 
with  alignment  with  the  acquis  on  the  fight  against  money  laundering.  New  implementing 
regulations and communiqués have been adopted and the  number of suspicious transactions 
reported has increased considerably. Turkey needs to continue alignment in this area. 

4.5. 

Chapter 5: Public procurement 

There has been no progress on the general principles. The 15% price advantage for domestic 
bidders is still enshrined in the legislation. However, less use was made of it than during the 
previous  year  (1.5%  of  the  overall  contract  value  in  2007  compared  with  8%  in  2006).  A 
number  of  additional  derogations  from  the  Public  Procurement  Law  have  been  adopted, 
notably in the laws with regard to associations, on Istanbul as the 2010 capital of culture and 
on  witness  protection.  The  amendment  of  the  electricity  market  law  brought  in  another 
derogation  to  the  public  procurement  law.  Such  derogations  reduce  competitiveness  and 
efficiency in public tender.  

Little progress has been made on the award of public contracts. The fairly high participation 
rate in tendering procedures indicates that information on public tenders is widely available, 
including  on  the  internet.  However,  the  Turkish  Public  Procurement  legislation  remains 
different from the acquis in various respects. The legislative amendment in 2007 introduced 
the concept of framework agreements to be applied only in the health sector. Utilities continue 
to  be  subject  to  the  classical  public  procurement  procedures.  There  is  no  coherent  legal 
framework for the award of concessions and public private partnerships. The 2008 thresholds 
and financial limits for procurement remain above EC levels. 

Both  the  Public  Procurement  Agency  and  the  State  Planning  Organisation  have  significant 
administrative  capacity.  However,  staff  awareness  of  the  State  Planning  Organisation  as 
regards  the  acquis  needs  to  be  strengthened.  The  specialisation  of  functions  and  staff 
competencies in the Public Procurement Agency needs to be enhanced. 

As  regards  the  institutional  set  up,  Turkey  has  designated  the  Ministry  of  Finance  as 
coordinator  of  public  procurement  policy,  including  concessions  and  PPPs,  which  is  one 
priority  of  the  Accession  Partnership.  This  decision  has  had  a  positive  impact,  as  it  has 
allowed better coordination of legislative preparations in 2008.  

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No  progress  can  be  reported  on  alignment  with  the  Remedies  Directives.  The  number  of 
complaints lodged by dissatisfied tenderers has grown over the years, from about 900 in 2003 
to  over  4 000  in  2007,  though  representing  only  3%  of  all  contract  awards.  The  review 
procedure is lengthy and results in creation of backlog of cases.  

Conclusion 

Some  limited  progress  can  be  reported  in  this  chapter.  Turkey  has  started  to  address  its 
priorities  in  the  area  of  public  procurement  and  has  the  capacities  to  address  them.  The 
designation of the Ministry of Finance as overall policy coordinator on public procurement is 
a positive development. The Ministry will have to ensure consistent policy development in the 
area  of  public  procurement  and  steer  its  implementation.  This  needs  to  be  backed  up  by  a 
comprehensive  strategy  on  the  reforms  necessary  in  terms  of  legislative  alignment  and 
institutional  capacity-building  in  order  for  Turkey  to  comply  with  the  acquis.  Derogations 
from  the  general  provisions  that  have  the  effect  of  reducing  competition  and  efficiency  in 
public tenders need to be avoided.  

4.6. 

Chapter 6: Company law 

No  substantial  progress  can  be  reported  on  company  law.  The  Turkish  Commercial  Code 
(TCC) and the law on the entry into force and implementation of the TCC were not adopted 
yet.  Adoption  of  these  two  laws  would  mark  an  important  step  forward  in  this  chapter, 
although some of the provisions of the TCC are not fully aligned with the acquis. Companies 
cannot register online in the registries operated by Chambers of Commerce. Establishment of 
an electronic database and on-line access to basic company information depend on adoption 
of the TCC. Adoption of the TCC will trigger amendment of various other laws, including the 
Capital  Markets  Law  (CML)  concerning  domestic  mergers  and  divisions  of  public  limited 
liability companies, the exercise of certain rights of shareholders in publicly held companies 
and takeover bids.  

Little progress can be reported in the area of corporate accounting. The Turkish Accounting 
Standards  Board  (TASB)  adopted  and  published  several  interpretations  and  revisions  of  a 
number  of  international  accounting  standards  (IAS).  The  adopted  standards  apply  solely  to 
listed  companies.  The  Capital  Markets  Board  of  Turkey  (CMB)  imposes  an  obligation  on 
listed companies to publish their yearly and quarterly financial statements in compliance with 
the IAS and the international financial reporting standards (IFRS) in the format applicable in 
the  EU.  However,  only  a  few  companies  in  Turkey  are  listed.  The  majority  are  non-listed. 
Further recruitment took place in order to enhance the administrative capacity of the TASB. 
Specific training was organised for newcomers. The process to enhance the professional skills 
of the TASB continued. 

No  progress  can  be  reported  on  auditing.  The  regulatory  framework  for  the  Auditing 
Standards Board is still under preparation.  

Conclusion 

No substantial progress can be reported in the period under consideration. Overall, alignment 
remains moderate. The new TCC, designed to improve alignment with the acquis and trigger 
the process of alignment of other laws in this area, has not been adopted.  

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4.7. 

Chapter 7: Intellectual property law 

The  overall  legislative  framework  for  intellectual  and  industrial  property  rights  is  largely 
aligned  with  the  acquis,  but  administrative  capacity  remains  insufficient  to  ensure  effective 
enforcement,  as  required  by  the  Customs  Union  Decision.  Turkey  remains  one  of  the 
countries where IPR protection and enforcement are most problematic. Effective enforcement 
is  a  priority  under  the  Accession  Partnership  Agreement  and  for  the  negotiations  on  this 
chapter. 

Some progress has been made in the area of copyright and neighbouring rights. Turkey has 
considerably improved coordination and cooperation between various stakeholders in the area 
of copyright and related rights issues. A coordination committee was set up in 2007 within an 
EU-funded  twinning  project.  It  was  convened  in  January  2008  to  draft  an  action  plan  to 
strengthen  copyright  protection 
to  strengthen 
in  Turkey.  Another 
enforcement  capacity  started  in  2008  and  will  be  conducted  throughout  the  year  with  the 
Turkish national police as the main target group. Many training sessions and seminars have 
been  organised  to  raise  awareness  of  IPR  enforcement  issues.  The  number  of  collecting 
societies  increased  from  22  to  24.  Four  collecting  societies  in  the  music  sector  agreed  on  a 
common approach to setting tariffs, licensing and other issues. They also signed an agreement 
on the licensing of musical works used in hotels. However, conflicting views persist regarding 
collective  rights  management  between  users  and  rights-holders.  Piracy  of  books  and  other 
media,  such  as  CDs  and  DVDs,  remains  widespread.  Turkey’s  enforcement  capacity  is  still 
lagging  behind.  The  laws  for  ratification  of  the  WIPO  Copyright  and  Phonograms  Treaties 
were published in the Official Gazette. 

twinning  project 

Some progress can be reported concerning the legislative framework for industrial property 
rights. A revision of the regulation implementing the European Patent Agreement in Turkey 
has entered into force. The Turkish Patent Institute (TPI) has further improved its internal and 
external IT structure. Improvements can also be reported in online services (including an e-
application system), search portals and public relations. Fifteen new staff members have been 
recruited.  Several  members  of  staff  have  attended  training  courses  to  improve  their  legal 
knowledge  and  various  awareness-raising  activities  have  been  organised.  However, 
inconsistencies persist between the trademarks department and the appeals board. Most of the 
appealed  decisions  are  reversed  by  the  appeals  board  and  the  courts.  Measures  should  be 
taken to harmonise implementation on the basis of absolute and relative grounds, especially 
for  earlier  use,  the  level  of  similarity  and  the  signs  which  may  be  used  as  trade  marks, 
including three-dimensional trade marks. Appeal and opposition procedures are very lengthy. 
Infringements  of  well-known  designs,  trademarks  and  trade  dresses  are  still  a  cause  for 
concern. TPI practices and courts’ understanding of the same issues diverge. Proper reasons 
should be given for the decisions of the TPI. The regulatory framework, including a code of 
ethics  for  patent  and  trademark  agents  to  prevent  misconduct  and  take  implementation 
forward, is not yet in place. So far no constructive dialogue has been established between the 
TPI and its customers and the various professional groups dealing with IPR. 

Particular  attention  should  also  be  paid  to  bad  faith  and  similar  trademarks  and  industrial 
design issues. 

As  regards  enforcement,  a  high-level  Intellectual  and  Industrial  Property  Coordination 
Board, co-chaired by the Ministry of Industry and Trade and the Ministry of Culture, has been 
established. The purpose of the Board is to foster cooperation between relevant institutions in 
order  to  improve  the  level  of  IPR  protection.  The  Board  will  meet  every  six  months.  The 

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Board will be able to invite other public institutions and private-sector representatives to its 
meetings.  An  action  plan  has  been  drawn  up.  The  criminal  provisions  of  the  Turkish 
Copyright Law have been amended to harmonise them with the new Turkish Criminal Code 
and Turkish Criminal Procedure Code. The new provisions have reduced legal predictability 
and enforceability with regard to banderol application and the ex-officio powers of the police 
to seize pirate goods. Consequently, enforcement against piracy has almost come to a halt in 
most Turkish cities, with the exception of Istanbul, Ankara and Izmir. During the drafting of 
these  special  provisions,  the  opinions  of  the  IPR  enforcers  (i.e.  judges  and  prosecutors 
specialising in IPR and collecting societies) were not sufficiently taken on board. Therefore, 
stakeholders  (including  the  judiciary)  need  to  acquire  a  better  understanding  of  the 
amendments to the criminal provisions in order to ensure effective enforcement. 

Following a recent Constitutional Court decision, Turkey’s trademark protection is at a crucial 
point.  The court  pointed  out  that trademarks  infringements could  not  be  punished  under  the 
current  legislation  because crimes  and  punishments  are  not  defined  appropriately  in  the 
relevant Turkish legislation. The court invited the government to remedy this situation and to 
address the current legal vacuum within six months, ending in January 2009. The relevant law 
prepared by the government has not been adopted. As long as the legal vacuum persists, all 
similar  pending  trademarks  infringements  will  be  affected.  However,  since  other  industrial 
property  rights,  like  designs,  patents,  utility  models  and  geographical  indications,  are  also 
regulated in the same way as trademarks, the court’s decision will affect all infringements of 
industrial property rights. The Turkish authorities need to tackle this situation as a matter of 
urgency and to eliminate the risk that industrial property infringements cannot be punished.  

Nine new specialised IPR courts (three civil and four criminal in Istanbul, one civil in Ankara 
and one civil in Izmir) were recently established and brought into operation. The locations of 
the courts were selected on the basis of the level of commercial activities. The appeal stage of 
the IPR court procedure is very lengthy. Most of the files on criminal acts have been pending 
before  the  Supreme  Court  for  a  long  time.  Rights-owners  are  experiencing  difficulties  in 
obtaining preliminary injunctions or search and seizure warrants which would offer a proper 
enforcement  solution  to  most  cases.  Training  seminars  and  workshops  have  been  held  for 
stakeholders such as customs officers, national and municipal police forces, lawyers and the 
related  staff  of  the  enforcement  bodies.  Three  public-awareness  seminars  were  organised. 
Customs officers seized goods in 160 cases on their own initiative in 2007 compared with 45 
in 2006. Turkey remains one of the main sources of counterfeited and pirated products seized 
at EU borders.  

Conclusion 

Overall  alignment  with  the  acquis  is  relatively  advanced.  Coordination  and  cooperation 
between  the  IPR-related  public  bodies  and  their  awareness  have  improved  significantly. 
However,  serious  deficiencies  remain  in  the  area  of  industrial  property  rights,  in  particular 
with implementation and enforcement. Turkey is still considering its response to the European 
Commission's suggestion to establish a dialogue on Intellectual property Issues.  

4.8. 

Chapter 8: Competition policy 

In  the  field  of  anti-trust,  including  mergers,  there  has  been  further  progress  on  legislative 
alignment.  

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The  Competition  Law  was  amended  to  provide  further  clarity  and  legal  certainty  in  the 
provisions regulating fines imposed for competition infringements. The competition authority 
adopted  a  block  exemption  communiqué  covering  the  insurance  sector,  in  line  with  the 
acquis.  The  authority  issued  another  block  exemption  communiqué  on  technology  transfer 
agreements.  There  are  a  few  divergences  between  this  communiqué  and  the  relevant 
Commission  rules,  in  the  form  of  hardcore  restrictions  due  to  the  Turkish  legislation  on 
intellectual property rights. The authority published two guidelines on market definition and 
subcontracting  agreements  between  non-competing  undertakings.  The  rules  on  horizontal 
for 
cooperation  agreements,  de  minimis  and 
telecommunications and postal services still need to be transposed. The Banking Law exempts 
mergers and acquisitions leading to a market share below 20% in the banking sector from the 
competition  authority’s  control.  This  exemption  limits  enforcement  of  the  merger  control 
rules in the banking sector. The authority’s efforts to promote competition might be limited in 
the upcoming privatisation of public banks due to this exemption.  

sector-specific  block  exemptions 

The  competition  authority  enjoys  a  sufficient  level  of  administrative  and  operational 
independence.  The  authority’s  emphasis  on  training  for  its  staff  is  a  determining  factor  for 
effective enforcement of the competition rules. All public authorities, including the Ministry 
of Industry and Trade to which the competition authority is linked administratively, need to 
respect the administrative and operational independence of the authority. 

As regards the enforcement record, in 2007, 238 merger and acquisition cases were handled 
and  232  cases  were  concluded  (up  from  199  and  186  in  2006).  The  authority  opened  131 
cases on anti-competitive behaviour and finalised 148 cases (up from 108 in 2006). The Board 
opened 34 negative clearance and individual exemption cases and concluded 39 in 2007 (36 
and 33 in 2006). The fines imposed by the authority decreased by 50%, from TRY 27,002,139 
in 2006 to TRY 13,641,633 in 2007. The authority has also been active during the first half of 
2008.  It  took  decisions  on  65  cases  of  anti-competitive  behaviour  and  on  109  merger 
notifications. The administrative capacity of the Council of State (high administrative court) 
for  handling  appealed  competition  cases  still  needs  to  be  improved.  However,  the 
establishment of a special chamber in the Council of State in 2007 is expected to speed up the 
review of competition decisions. 

There  has  been  no  progress  on  alignment  of  the  rules  concerning  public  undertakings  and 
undertakings having exclusive and special rights. 

In  the  field  of  state  aid,  no  progress  has  been  made.  Turkey  has  not  adopted  the  state  aid 
legislation  nor  set  up  an  operationally  independent  state  aid  monitoring  authority. 
Furthermore,  Turkey  has  not  prepared  the  state  aid  inventory  and  has  not  reported  on  state 
schemes,  as  required  by  the  transparency  commitments.  There  are  no  rules  ensuring 
transparency of financial relations between public authorities and public undertakings. 

Some  progress  has  been  achieved  as  regards  state  aid  in  the  steel  sector.  Following  the 
transmission of new information in 2008, the Commission has an improved understanding of 
the  state  aid  granted  from  2001  until  now.  Furthermore,  Turkey  has  reviewed  the  national 
restructuring  programme  concerning  both  the  state  aid  aspects  and  the  market  analysis  and 
forecast  for  the  Turkish  steel  industry.  However,  information  is  still  needed  on  several 
capacity developments and some state aids of the last years as well as on a clear position of 
the Turkish authorities concerning future state aid to the steel sector. 

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Conclusion 

In the field of anti-trust, including mergers, a high level of alignment has been achieved. The 
administrative  capacity  and  operational  independence  of  the  competition  authority  are 
satisfactory.  The  authority  enforces  the  competition  rules  effectively.  There  has  been  no 
alignment in the field of state aid. Turkey needs to implement the EU state aid discipline in 
the  steel  sector,  in  line  with  the  long-standing  commitment  given  in  the  ECSC  Free  Trade 
Agreement. Alignment in this chapter is not complete. 

4.9. 

Chapter 9: Financial services 

Good, but uneven, progress can be reported on banks and financial conglomerates. With a 
view  to  strengthening  the  liquidity  position  in  the  banking  system,  the  Banking  Regulatory 
and  Supervisory  Agency  (BRSA)  introduced  additional  liquidity  requirements.  However, 
Turkey  has  postponed  implementation  of  the  BASEL  II  Accord.  The  Agency  also  advised 
private  banks  to  build  up  a  solid  capital  stock  in  response  to  the  recent  financial  turmoil. 
Moreover,  the  prudential  and  supervisory  standards  have  been  tightened  up.  The  BRSA 
imposed marked-to-market valuation for the derivative instruments recorded on bank balance 
sheets.  The  BRSA  clarified  the  coordination  rules  for  consolidated  supervision  of  financial 
institutions  which  are  being  supervised  by  separate  regulatory  authorities.  The  Savings 
Deposits  and  Insurance  Fund  (SDIF)  introduced  five  deposit  premium  categories  for  banks, 
based  on  their  detailed  risk  profiles.  In  turn,  the  BRSA  introduced  additional  reporting 
requirements  for  the  representative  offices  of  foreign  banks.  The  Agency  also  placed  an 
obligation on foreign banks’ branch and representative offices to apply for authorisation in the 
event of any change in the ownership of the parent undertaking in the home State. The BRSA 
organised several training sessions for its staff and gave a dozen staff members an opportunity 
to  study  abroad.  The  BRSA  has  also  established  further  memoranda  of  understanding  with 
third countries, taking the number of MoUs up to 16. Supervisory capacity has been enhanced 
by  introducing  new  reporting  requirements  and  an  early  warning  system.  In  the  area  of 
banking  and  financial  conglomerates,  Turkey  has  further  aligned  with  the  acquis.  Further 
efforts  are  needed  to  continue  alignment  with  the  new  capital  requirements  for  credit 
institutions and investment firms and with the other related directives (on deposit guarantee 
schemes,  winding  up  and  reorganisation,  financial  conglomerates  and  bank  accounts),  as 
outlined in the Accession Partnership.  

There has been significant progress in the area of insurance and supplementary pensions. 
The  Treasury  introduced  the  concept  of  “sponsoring  undertaking”  in  a  newly  published 
regulation  on  occupational  pension  schemes.  The  same  regulation  also  introduced  limits  on 
the  fees  and  expenses  that  insurance  companies  are  allowed  to  be  charged,  whereas  the 
vesting period for group insurance policies was reduced to five years. The Treasury published 
a  regulation  on  supplementary  pension  companies  covering  fit  and  proper  criteria  for 
ownership,  licensing  applications,  mergers  and  acquisitions,  rules  on  advertising  and  public 
disclosure.  As  far  as  solvency  is  concerned,  the  paid-in  capital  of  an  insurance  company’s 
subsidiaries and affiliates has been included in the definition of the owners’ equity. As regards 
passenger  transport,  Turkey  has  increased  the  minimum  level  of  coverage  under  the 
compulsory  insurance  scheme.  However,  coverage  levels  for  personal  injuries  are  still  well 
below  EU  standards.  The  Treasury  adopted  a  new  communiqué  requiring  insurance  and 
supplementary  pension  companies  to  publish  their  financial  statements  both  in  newspapers 
and  on  their  own  websites.  Turkey  has  introduced  a  new  type  of  insurance  for  loan 
repayments  by  bank  customers.  A  new  regulation  on  insurance  mediation  has  entered  into 
force.  It  has  improved  consumer  protection  and  set  new  standards  on  registration  and 

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minimum  capital,  while  introducing  professional  indemnity  insurance  for  intermediaries. 
However,  indemnity  coverage  levels  are  markedly  below  the  EU  standards.  Several  other 
insurance  regulations  have  been  published,  covering  training,  internal  control  and  risk 
management  systems,  and  rules  on  establishment  for  brokers.  However,  provision  of  cross-
border  services  is  impeded,  as  the  regulations  place  an  obligation  on  foreign  brokers  to 
operate via branch offices established in Turkey. A regulation on the activities of committees 
of  insurance  experts  has  also  been  adopted.  Finally,  a  regulation  implementing  the  rules  on 
the professional qualifications, accounting and bookkeeping responsibilities and activities of 
insurance experts has been published. Alignment in the area of insurance and supplementary 
pensions  is  partial.  Establishing  an  independent  regulatory  and  supervisory  authority  is  a 
priority.  Further  alignment  is  needed,  in  particular  on  calculation  of  solvency  margins, 
supervision of insurance groups and the minimum amounts of cover in motor insurance. 

Turkey already largely fulfils the acquis requirements. No further progress can be reported on 
financial market infrastructure. 

Some progress can be reported on securities markets and investment services. The Capital 
Markets Board of Turkey (CMB) imposes an obligation on listed companies to publish their 
yearly  and  quarterly  financial  statements  in  compliance  with  the  international  accounting 
standards  (IAS)  and  the  international  financial  reporting  standards  (IFRS)  in  the  format 
applicable in the EU. The CMB successfully completed a twinning project which contributed 
to  further  improving  the  capital  market  legislation  and  the  administrative  capacity  of  the 
regulatory  authority.  Alignment  in  the  area  of  securities  markets  and  investment  services  is 
moderately  advanced.  Further  progress  is  needed,  in  particular  on  markets  in  financial 
instruments, investor compensation schemes, prospectuses and market abuse. 

“Financial  services”  is  one  of  the  eight  chapters  covered  by  the  conclusions  on  Turkey 
adopted by the Council (General Affairs and External Relations) on 11 December 2006 and 
endorsed by the European Council on 14/15 December 2006. As long as restrictions remain in 
place on the free movement of goods carried by vessels and aircraft registered in Cyprus or 
where the last port of call was Cyprus, Turkey will not be in a position fully to implement the 
acquis relating to this chapter. 

Conclusion 

There  has  been  good  progress  in  the  area  of  financial  services.  Progress  has  been  made  on 
tightening  up  prudential  and  supervisory  standards,  both  in  banking  and  in  the  non-bank 
financial sector. Authorities have taken measures to strengthen the liquidity position and the 
capital adequacy of the banking system. A risk-based deposit insurance premium system has 
been  introduced.  As  regards  insurance  and  supplementary  pensions,  Turkey  has  made 
significant progress by adopting regulations on occupational pension schemes, publication of 
financial  statements  and  insurance  mediation.  The  CMB  has  introduced  IAS  and  IFRS 
standards  for  listed  companies.  There  was  further  alignment  as  regards  banks  and  financial 
conglomerates,  while  alignment  in  securities  markets  and  investment  services  is  moderately 
advanced.  Turkey  largely  meets  the  acquis  requirements  in  the  area  of  financial  market 
infrastructure. Alignment in the area of insurance and supplementary pensions is incomplete; 
in  particular,  an  independent  supervisory  authority  in  the  insurance  and  supplementary 
pensions sector needs to be set up. 

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4.10.  Chapter 10: Information society and media 

Some progress can be reported in the field of electronic communications and information 
technologies. As of June 2008, the total number of fixed subscribers is around 18 million with 
a  penetration  rate  of  roughly  25%.  The  total  number  of  mobile  subscribers  reached  to  63.6 
million  with  a  penetration  rate  of  90%.  The  number  of  Internet  subscribers  reached  to 
approximately 5.4 million, 5.3 million of which are broadband (ADSL) subscribers. 

Turkey continued its alignment by introducing new regulations on access and interconnection 
based on the 2002 EU framework, on operators with significant market power (SMP) on the 
reference  interconnection  offer  (RIO)  and  the  reference  Unbundling  Offer  and  wholesale 
broadband  access  conditions  from  the  incumbent  internet  operator.  Furthermore,  mobile 
termination rates have continued to gradually decrease.  

There  has  been  some  progress  on  number  portability,  which  may  become  possible  from  10 
November  2008  in  the  mobile  market  after  a  central  database  became  operational  in  the 
Telecommunications  Authority.  Some  initial  progress  can  also  be  reported  for  local  loop 
unbundling following the revision on Turk Telekom’s reference unbundling offer last year. .  

However, the Electronic Communications Law which would provide the basis for alignment 
with  the  EU  framework  did  not  enter  into  force  after  its  adoption  by  the  Parliament.  The 
Turkish  President  vetoed  four  articles  on  the administrative  and  financial  conditions  for  the 
regulatory  authority  and  the  draft  is  back  in  Parliament  for  discussion.  Competition  in  the 
fixed  and  broadband  markets  remains  marginal.  More  than  95%  of  the  broadband  internet 
access  services  are  provided  by  the  incumbent’s  internet  operator.  Limited  progress  can  be 
reported towards equitable and transparent conditions for fixed wholesale broadband access. 
No  progress  can  be  reported  with  regard  to  accounting  separation  and  cost  accounting 
imposed  on  the  fixed  incumbent.  High  taxation  on  communication  services  unrelated  to 
administrative  costs  for  regulating  the  sector  remains  a  problem.  The  scope  and 
implementation  of  universal  service  obligations  are  still  incompatible  with  the  relevant 
acquis.  Liberalisation  of  local  telephony  is  still  pending  and  undermines  competition  in  the 
fixed  and  broadband  markets.  The  regulatory  body  is  well  staffed  and  is  self-financed. 
However,  it  lacks  independence  -  notably  in  the  authorisation  process  -  and  the  decision 
making process of the Telecommunications Authority is not transparent. 

Implementing regulations on provision of internet services at public places and on principles 
and  procedures  concerning  the  regulation  of  the  broadcasts  on  internet  have  been  adopted 
during the reporting period. Implementation of these regulations have the potential to violate 
freedom of expression. 

In the area of audiovisual policy some progress can be reported, the Turkish Grand National 
Assembly  amended  the  Turkish  Radio  and  Television  Corporation  (TRT)  Law  allowing 
broadcasts  in  languages  other  than  Turkish  (See  Political  criteria).  RTÜK  promoted  self-
regulation  by  broadcasters  and  enhanced  its  administrative  capacity  to  fulfil  its  monitoring 
duties. Since August 2008, RTÜK decisions are accessible to the public.  

However,  Turkey’s  level  of  alignment  with  the  EC  acquis  on  audiovisual  policy  remains 
limited  to  provisions  concerning  advertising  and  the  protection  of  minors.  The  Law  on  the 
establishment  of  radio  and  television  broadcasts  still  poses  problems  in  terms  of  non-
discrimination  on  the  grounds  of  nationality,  definitions,  jurisdiction,  freedom  of  reception 
and  retransmission,  major  events,  promotion  of  European  and  independent  works  and 

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restrictions  on  the  share  of  foreign  capital  and  television  enterprises.  As  regards 
administration of the broadcasting sector, RTÜK has not reallocated frequencies or reviewed 
temporary licences. RTÜK established a regular dialogue with the broadcasters and enhanced 
the transparency of its decisions. However, further measures are needed in order to strengthen 
the functionality of the regulator. 

Conclusion 

Some  progress  can  be  reported  in  the  field  of  electronic  communications,  in  particular  as 
regards  competitive  safeguard  measures  imposed  on  dominant  operators,  notably  in  the 
mobile and broadband markets. However, alignment with the EU framework remains limited. 
The adoption of a new primary electronic communications law well aligned with EU rules is 
crucial. As regards the acquis on audiovisual policy, Turkey’s level of alignment remains is 
limited.  

4.11.  Chapter 11: Agriculture 

Progress  on  legislative  alignment  with  the  common  agricultural  policy  (CAP)  has  been 
limited. No progress can be reported concerning the announced restructuring of the Ministry 
of Agriculture and Rural Affairs (MARA).  

As  regards  horizontal  issues,  Turkey  has  made  limited  progress.  The  government's 
announcement of the intention to scrap decoupled area payments and replace them by coupled 
payments  remains  a  cause  for  concern.  This  would  lead  to  Turkey’s  agricultural  policy 
drifting away from the reformed CAP and from the principles of competitiveness and market 
orientation. 

Turkey has advanced in preparing a strategy to develop the system of land identification and a 
farmer's  register,  as  well  as  a  strategy  to  develop  agricultural  statistics  in  line  with  EU 
requirements.  Efforts  to  set  up  a  pilot  Farm  Accountancy  Data  Network  (FADN)  have 
continued.  

Turkey  continues  to  ban  imports  of  beef  and  of  live  bovine  animals  originating  in  the  EU. 
These barriers are not in line with bilateral obligations and their removal is a key component 
of the accession negotiations on this chapter. 

Concerning the common market organisations, some progress on acquis alignment could be 
noted  with  the  adoption  of  two  regulations  on  purchases  and  sales  of  cereals  and  rice  and 
paddy  rice.  Progress  has  also  been  made  on  alignment  of  Turkey’s  legislation  with  EU 
marketing standards for fruit and vegetables. The conformity checking operations, performed 
by the Turkish authorities prior to import into the Community for all fresh fruit and vegetables 
are recognised by the EU/Community.  

As  regards  rural  development,  substantial  progress  has  been  made.  The  Turkish  rural 
development programme for 2007-2013, prepared under component V of the Instrument for 
Pre-Accession Assistance (IPARD) and designed to support policy development in the field 
of  agriculture  and  rural  development,  as  well  as  the  preparation  for  the  implementation  and 
management  of  the  Common  Agricultural  Policy,  was  approved  by  the  Commission  in 
February  2008.  This  marks  a  major  step  towards  implementation  of  IPARD  in  Turkey. 
Concerning administrative structures, the head of the IPARD Agency has been appointed and 
a  concise  action  plan  for  the  accreditation  process  has  been  submitted  to  the  Commission. 
According to the plan conferral of management powers by the Commission is scheduled for 

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June 2009. The legislative framework for operation of the managing authority is in place and 
personnel, both at headquarters and at provincial level, are being appointed and trained. 

No  progress  was  observed  on  quality  policy  and  organic  farming.  As  regards  organic 
farming,  Turkey  has  continued  its  efforts  to  be  included  in  the  equivalency  list  of  third 
counties for imports of organic products according to Article 11 of Council Regulation (EEC) 
2092/91.  Following  the  transmission  of  additional  information  regarding  Turkish  organic 
farming  production  rules  and  control  system  in  the  end  of  the  year  2007,  the  Commission 
could close several points. The main areas of concern remain approval of inputs  allowed in 
organic farming and supervision system 

“Agriculture” is one of the eight chapters covered by the conclusions on Turkey adopted by 
the Council (General Affairs and External Relations) on 11 December 2006 and endorsed by 
the European Council on 14/15 December 2006. As long as restrictions remain in place on the 
free movement of goods carried by vessels and aircraft registered in Cyprus or where the last 
port of call was Cyprus, Turkey will not be in a position fully to implement the acquis relating 
to this chapter. 

Conclusion 

Alignment with the acquis remains limited. Turkey has made substantial progress on building 
the  capacity  necessary  to  implement  IPARD.  However,  further  efforts  must  be  made  to 
complete establishment of the necessary administrative and control structures so that they will 
be  able  to  operate  in  a  fully  decentralised  management  system.  Progress  as  regards 
administrative  structures  related  to  the  CAP  was  limited  to  the  FADN  system  and  fruit  and 
vegetables.  Current  support  and  strategic  policy  planning  in  Turkey  seem  to  be  developing 
away from the principles of the reformed CAP by strengthening support instruments linked to 
production. Technical barriers to trade in bovine products in breach of bilateral commitments 
remain. Overall, preparations are still at an early stage in this chapter. 

4.12.  Chapter 12: Food safety, veterinary and phytosanitary policy 

Transposition and implementation of EU food safety policy remain limited. The Framework 
Law on food, veterinary, feed, hygiene and official controls, which needs to provide for clear 
assignment of responsibilities, in particular for control bodies, has not yet been adopted. 

With regard to general food safety policy, the national rapid alert system for food and feed has 
been improved. Local units have been directly linked to the Ministry of Agriculture and Rural 
Affairs  to  ensure  effective  follow-up  of  notifications.  Monthly  reports  on  the  follow-up  to 
RAFFS  alerts  are  being  sent  to  the  Commission.  However,  the  number  of  notifications 
received  is  still  very  high.  Further  efforts  to  follow  up  alerts  and  implement  the  necessary 
corrective measures are still needed. 

Regarding  veterinary  policy,  Turkey  has  made  limited  progress  on  both  transposition  and 
implementation of the acquis. 

The first veterinary border inspection post (BIP) at Sabiha  Gorken airport in Istanbul  is not 
yet  fully  operational.  The  BIP  receives  a  low  number  of  consignments  because  most  still 
arrive at Ataturk airport in Istanbul. Construction of three land and two seaport BIPs is under 
way. The system for identification and registration of bovines and their movements has been 
improved  as  regards  registration  of  holdings  (including  animal  markets),  control  of 
movements of animals and training of users of the database. Turkey has made further efforts 

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to bring the system into line with the acquis. However, supplementary efforts are necessary as 
regards  registration  of  movements  in  the  bovine  database.  Initial  work  on  identification  and 
registration  of  ovine  and  caprine  animals  is  ongoing,  with  the  aim  of  setting  up  an 
identification  system  covering  sheep  and  goats  in  line  with  EU  requirements.  For  the  time 
being, only some voluntary identification and registration activities have been introduced for 
small ruminants in some provinces. No progress can be reported as regards non-commercial 
movements of pets. 

Turkey  has  continued  its  efforts  to  combat  animal  diseases.  Efforts  have  focused  on  avian 
influenza  (AI)  and  foot-and-mouth  disease  (FMD),  as  in  previous  years.  AI  outbreaks  were 
low  in  number  in  the  reporting  period  and  successfully  contained  with  the  cooperation  of 
public  health  authorities.  Intensive  awareness-raising  campaigns  were  implemented.  The 
regulation  concerning  protection  against  AI  has  entered  into  force.  Stricter  measures  on 
animal  movements  between  Thrace  and  Anatolia  have  had  a  positive  impact  on  the 
occurrence  of  FMD  outbreaks  in  Thrace,  where  the  number  of  outbreaks  has  considerably 
decreased. The last FMD outbreak in Thrace was in September 2007. Turkey has also started 
focusing  on  attaining  brucellosis-  and  tuberculosis-free  status  in  Thrace,  although  no 
significant  progress  has  been  observed  on  the  ground.  No  progress  can  be  reported  with 
transmissible  spongiform  encephalopathy  (TSE).  Turkey  has  continued  its  voluntary 
participation in the EU animal disease notification system (ADNS). Relevant information on 
animal diseases was provided to the EU and to other international organisations. 

Turkey has improved its procedures for implementing and following up the national residue 
monitoring plan and controls on veterinary medicinal products. However, additional progress 
is essential, mainly on the laboratory side and on inclusion of all substances on which controls 
are required by the EU legislation. 

Turkey’s current system for financing veterinary inspections and controls is not in line with 
EU practice. No progress has been observed regarding import requirements for live animals 
and animal products. The regime of individual licences for import of each consignment of live 
animals  and  animal  products  has  not  been  modified.  The  de  facto  beef  ban  is  still  in  place 
(See Chapter 11). Turkey has made no progress on animal welfare and zootechnical issues. 

No  progress  can  be  reported  as  regards  placing  on  the  market  of  food  and  feed. 
Transposition of the hygiene package, which is a key component of the accession negotiations 
on  this  chapter,  has  not  yet  been  completed.  Unclear  division  of  tasks  between  different 
departments  and  institutions  is  still  leading  to  problems  with  official  controls.  Some 
improvements were observed in the administrative structures as a result of intensive training 
programmes.  Work  has  started  on  accreditation  of  inspection  services,  but  no  substantial 
progress  has  been  observed  in  this  field.  The  legislative  basis  has  been  put  in  place  for 
establishment of the national food reference laboratory in Ankara. Risk-based annual control 
programmes have been established for several products. The data network system, which will 
allow  more  efficient  implementation  of  inspection  and  control  programmes,  has  been 
improved.  Preliminary  preparations  for  classification  of  agri-food  establishments  as  regards 
their compliance with EU structural requirements, which is a key component of the accession 
negotiations  on  this  chapter,  have  started.  However,  no  action  has  been  taken  to  bring  agri-
food establishments into compliance with the EU hygiene requirements. No progress has been 
observed on animal by-products. 

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Alignment  and  implementation  of  the  legislation  on  labelling,  presentation  and  advertising, 
food  additives  and  purity  criteria,  extraction  solvents,  quick  frozen  foodstuffs,  food  for 
particular nutritional uses and irradiated food has advanced.  

Transposition  in  the  areas  of  flavourings,  food  supplements,  novel  food  and  genetically 
modified organisms (GMOs) has yet to be completed. Alignment and implementation of the 
legislation on food contact materials has advanced; however, further adaptations are required 
to bring the system fully into line with the EU system. 

Aflatoxin  contamination  remains  a  major  problem.  A  communiqué  on  the  methods  of 
sampling, sample preparation and analysis for the official control of lead, cadmium, mercury, 
inorganic  tin,  3-monochloropropane-1,2-diol  and  benzopyrene  in  foodstuffs  and  the 
communiqué on the maximum limits on contaminants have entered into force. Alignment is 
advanced  in  the  case  of  mineral  waters.  No  progress  has  been  observed  as  regards  specific 
rules for feed. 

Progress  on  phytosanitary  policy  remains  limited.  Transposition  of  the  legislation  on  plant 
protection products is advanced. Implementing regulations on seeds and propagating material 
have entered into force. The law on plant health and quarantine has not yet been adopted. No 
developments were reported on international phytosanitary agreements. 

Conclusion 

Progress in the area of food safety, veterinary and phytosanitary policy has been limited and 
needs  to  be  consolidated.  Transposition  and  implementation  of  the  acquis  in  this  chapter 
requires considerable efforts. Strengthening administrative capacity at central and local levels 
is vital for proper implementation. 

4.13.  Chapter 13: Fisheries 

No  significant  progress  has  been  made  on  alignment  with  the  fisheries  acquis.  The  revised 
law  on  fisheries  has  not  yet  been  adopted.  The  central  administration  structures  remain 
unsatisfactory.  The  spread  of  powers  across  different  ministries  and  even  different 
departments within the Ministry of Agriculture and Rural Affairs (MARA) persisted. 

Some  progress  has  been  made  as  regards resource  and fleet  management. There has been 
improvement  in  the  fisheries  information  system  however  it  is  not  yet  fully  operational. 
Turkey’s satellite-based system for monitoring (VMS) the 86 blue-fin tuna fishing vessels is 
in  place.  This  monitoring  system  is  currently  used  by  196  vessels,  .  Two  additional  fishery 
port  offices  have  been  established  and  been  brought  into  operation.  No  progress  can  be 
reported as regards stock assessment. 

Limited progress has been achieved on inspection and control. It is now compulsory to keep 
fishing  records  in  logbooks  for  fishing  vessels  longer  than  12  metres,  which  will  allow 
registration and reporting of catches. Turkey has started work on introducing sales notes in 10 
wholesale markets on a pilot basis. 

No progress can be reported concerning structural action, market policy and state aid. 

As regards international agreements, Turkey signed a fisheries agreement with Yemen and a 
fisheries cooperation protocol with Georgia. 

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“Fisheries” is one of the eight chapters covered by the conclusions on Turkey adopted by the 
Council (General Affairs and External Relations) on 11 December 2006 and endorsed by the 
European  Council  on  14/15  December  2006.  As  long  as  restrictions  remain  in  place  on  the 
free movement of goods carried by vessels and aircraft registered in Cyprus or where the last 
port of call was Cyprus, Turkey will not be in a position fully to implement the acquis relating 
to this chapter. 

Conclusion 

Limited  progress  has  been  made  on  resource  and  fleet  management  and  on  inspection  and 
control. However, Turkey has made no progress on legislative alignment in this chapter. The 
administrative structures necessary to implement the Common Fisheries Policy have not been 
established. 

4.14.  Chapter 14: Transport policy 

Preparations in the area of road transport are advanced and some further progress has been 
made. Licensing of road transport operators and certification of professional competence are 
close to completion. Turkey has issued a decree setting out the principles of a fleet renewal 
scheme and for phasing out old vehicles.  

Institutional  capacity  has  been  further  strengthened.  The  Directorate-General  for  Highways 
has  been  transferred  from  the  Ministry  of  Public  Works  and  Settlement  to  the  Ministry  of 
Transport.  This  has  improved  coordination  between  transport  authorities.  Moreover  the 
Directorate-General  for  Land  Transport  (DGLT)  has  established  a  new  unit  for 
implementation of the Regulation on dangerous goods. However, DGLT has not reached the 
necessary  monitoring  and  control  standards  and  a  precondition  for  the  Regulation 
implementation has not been fulfilled as Turkey has not yet become a party to the European 
agreement  on  the  international  carriage  of  dangerous  goods  by  road  (ADR).  Financial  and 
professional  competence  requirements  are  less  stringent  for  domestic  operators.  Continued 
efforts  are  required  in  order  to  meet  EU  technical  requirements,  also  in  the  field  of  road 
transport,  in  particular  for  the  introduction  of  digital  tachographs  -  where  necessary 
preparatory work to meet international obligations and its implementation has not yet started - 
and  for  speed  limitation  devices'  requirements  for  light  buses  and  utility  vehicles  which  are 
not in line with the acquis..  

There  has  been  some  progress  in  preparations  for  a  new  railways  law,  which  are  at  an 
advanced stage, but there is no progress with its adoption process. Attention must be paid so 
that  any  new  legislation  achieves  effective  alignment  with  the  acquis  in  the  sector  of  rail 
transport.  

There is no inland waterways transport covered by the acquis in Turkey. 

Limited progress can be reported in the area of air transport. Processes related to SHD-T-35 
licences were aligned with the European Aviation Safety Agency (EASA) Regulations, Part 
66  and  Part  147.  Preparation  of  regulations  on  slot  allocation,  groundhandling  services, 
passenger  rights  and  maintenance  systems  is  advancing.  The  EASA  accredited  the 
Directorate-General for Civil Aviation (DGCA) in the field of aircraft maintenance. However, 
its  implementation  capacity  in  these  technical  areas  is  lagging  behind.  Preparations  for  a 
single European sky are at an early stage.  

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Air  traffic  management  is  suffering  from  a  lack  of  regional  cooperation.  The  lack  of 
communications between air traffic control centres in Turkey and the Republic of Cyprus is 
seriously compromising air safety in the Nicosia flight information region.  

As regards maritime transport, alignment in the area of safety is well advanced. Secondary 
legislation  on  roll-on/roll-off  passenger  ships  and  high-speed  craft  has  been  published.  The 
regulation  on  seafarers  has  been  amended  on  the  7th  of  July  2008  in  accordance  with  the 
provisions  of  the  I/8  and  Code  A-I/8  section  of  the  STCW-95  Convention.  Preparations  for 
improvement  of  the  institutional  capacity  to  prevent  pollution  from  ships,  along  with 
emergency response capacity, have not yet been launched. 

The rules on cabotage and ship registration are not in line with the acquis. Turkey has not yet 
become a signatory to SOLAS-78, SOLAS-88 and Mar-Pol Annexes III and IV. Turkey is on 
the grey list of the Paris memorandum of understanding. The detention rate of Turkish vessels 
in 20078 improved to 6,12 %, compared with an EU average of 3,08 %. 

No particular development in the area of combined transport and satellite navigation can be 
reported. 

“Transport policy” is one of the eight chapters covered by the conclusions on Turkey adopted 
by the Council (General Affairs and External Relations) on 11 December 2006 and endorsed 
by the European Council on 14/15 December 2006. As long as restrictions remain in place on 
the free movement of goods carried by vessels and aircraft registered in Cyprus or where the 
last port of call was Cyprus, Turkey will not be in a position fully to implement the acquis 
relating to this chapter.  

No  progress  has  been  made  on  state  aid.  There  is  no  established  institution  or  legal 
framework in Turkey to regulate State aid. 

Conclusion 

Turkey  has  made  limited  progress  on  transport.  In  the  area  of  road  transport,  alignment  is 
advanced. However, the implementation capacity is lagging behind and continued efforts are 
required to ensure due enforcement of road safety. Little progress can be reported in the rail 
sector. Progress in the maritime sector is uneven. The institutional capacity for prevention of 
pollution  and  emergency  response  is  insufficient.  There  has  been  limited  progress  on  air 
transport. The lack of communications between air traffic control centres in Turkey and the 
Republic of Cyprus is seriously compromising air safety. In both the air and maritime sectors, 
no progress has been made on becoming a party to international conventions. 

4.15.  Chapter 15: Energy 

Regarding security of supply, limited progress has been made. A legislative package with the 
aim of strengthening security of supply and speeding up investment in energy infrastructure 
was  adopted.  Under  the  new  law,  the  State  may,  when  necessary,  engage  in  electricity 
generation  in  addition  to  the  private  sector.  No  developments  were  reported  regarding 
approximation of the methods of calculating oil stocks with the EU method. The natural gas 
pipeline between Turkey and Greece is now in operation.  

Some progress can be reported on the internal energy market. The eligible consumers limit 
was  lowered  to  1.2  GWh  which  is  equivalent  to  market  opening  of  approximately  41%.  A 
cost-based  pricing  mechanism  came  into  force  by  July  2008.  This  mechanism  enables  State 

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economic  enterprises  (SEEs)  operating  in  the  field  of  energy  to  reflect  changes  in  their 
production/input costs in their sales prices. The mechanism is expected to contribute to better 
and sustainable pricing on energy markets and to help to improve the financial position of the 
SEEs concerned. However, cross-subsidies persist in the electricity sector and non-cost items 
like  TRT  share  remain  part  of  electricity  bills.  The  privatisation  process  of  four  electricity 
distribution  regions  has  been  completed.  The  privatisation  high  council  and  Energy  Market 
Regulatory  Authority  have  not  yet  approved  the  processes.  The  percentage  of  their  annual 
electricity generation that auto-producers are allowed to sell on the electricity market has been 
increased  to  50%  from  30%.  By  the  end  of  2007,  48.3%  of  electricity  was  generated  by 
SEEs. Electricity  theft  and  loss  was  reduced  to  15%,  but  remains  almost  twice  the  EU 
average. 

There has been very  limited  progress as regards the natural gas market. By the end of May 
2008, the distribution tender process was completed for 55 regions. A total of 40 cities have 
started to use natural gas. The Ankara natural gas distribution company has been privatised. 
An  amendment  to  the  natural  gas  market  law  allows  the  state  pipeline  operator  BOTAS  to 
import LNG from spot markets. Also, the natural gas licensing regulation was amended in a 
way to facilitate LNG imports. No developments have been observed in transfer of BOTAS’s 
contracts to the private sector. BOTAS still imports 86.6% of the consumption in Turkey. The 
Natural Gas Market Law requires BOTAS to transfer purchase or sale contracts to the private 
sector until its aggregate annual imports fall to 20% of annual national consumption by 2009. 

Competition remains limited on both the electricity and the natural gas markets. To improve 
operation of the markets and establish competition, the regulatory authority needs to exercise 
its powers in a more assertive manner. 

No progress can be reported concerning state aid. 

In the case of energy  efficiency, some progress can be reported. Following  adoption  of  the 
Framework Law last year, an implementing regulation covering the transport sector has now 
been  adopted.  A  prime  ministerial  circular  has  declared  2008  the  year  of  energy  efficiency 
and  the  government  has  drawn  up  an  action  plan  on  “energy  efficiency  movement”.  The 
administrative capacity of the Directorate-General for Electrical Power Resources Survey and 
Development  needs  to  be  enhanced  in  order  to  make  it  more  effective  in  this  field.  No 
national targets have been set for energy efficiency and renewable energy. The amendments 
to  the  Renewable  Energy  Law  introduced  additional  incentives.  The  Energy  Market 
Regulatory  Authority  issued  the  criteria  to  be  applicable  to  renewable  energy  generation 
facilities  for  their  connection  to  the  grid.  Following  adoption  of  the  Framework  Law  on 
geothermal energy, the implementing regulation on principles and procedures for exploration, 
operation and licensing of geothermal resources, natural mineral waters and geothermal-based 
gases was adopted. 

As  regards  nuclear  energy  and  radiation  protection,  a  Framework  Law  on  establishment 
and operation of nuclear power plants and energy sales has been adopted. This marks a major 
change  in  Turkey’s  energy  policy.  The  Turkish  Electricity  Trade  Company  (TETAS) 
launched the tender for construction and operation of a nuclear power plant in Mersin Akkuyu 
and announced the call for proposals. For the tender of Turkey's first power plant only one bid 
was submitted and the evaluation process has started by end of September. The implementing 
regulation on competition and contracting principles and procedures within the scope of the 
Framework Law was also adopted. Turkey needs to fully implement the requirements of the 
Convention  on  nuclear  safety,  in  particular  those  related  to  siting  and  to  regulator's 

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independence,  and  that  the  existing  legislative  framework  in  the  field  of  nuclear  safety  and 
radiation  protection  is  completed,  implemented  and  monitored.  Management  of  institutional 
radioactive  waste  needs  to  be  brought  into  line  with  international  recommendations,  basic 
safety standards and best EU practice. Turkey has not acceded to the Joint Convention on the 
safety of spent fuel management and radioactive waste management. 

Conclusion 

There has been some, but uneven, progress in the area of energy. Several years after adoption 
of  the  Framework  Laws  on  the  electricity  and  natural  gas  markets,  competition  remains 
limited  and  transparent  and  cost-based  pricing  has  yet  to  be  achieved.  National  targets  for 
energy efficiency and renewable energy have yet to be set.  

4.16.  Chapter 16: Taxation 

There  has  been  little  progress  on  indirect  taxation.  Turkey’s  value-added  tax  legislation  is 
partially  aligned  with  the  acquis.  Further  alignment  of  the  structure,  exemptions,  special 
schemes and application of reduced rates is needed.  

As  regards  excise  duties,  the  minimum  levels  on  tobacco  products  have  been  increased. 
However,  discrepancies  between  the  Turkish  legislation  and  the  acquis  on  the  structure  of 
excise duty on tobacco and tobacco products remain unchanged. Turkey applies ad valorem 
rates and has no element of specific excise duties. The Tobacco Fund remains discriminatory. 
It  sets  a  special  duty  on  imported  tobacco  and  cigarettes  only,  which  is  not  applied  to 
domestic products. Turkey has not introduced any duty-suspension arrangement for domestic 
movements and fiscal warehouses. 

Alcoholic beverages are taxed on the basis of an ad valorem duty, supplemented by a specific 
duty  if  the  former  is  lower  than  the  minimum  amount.  The  specific  duty  levels  are 
differentiated on the basis of the type of product, instead of alcohol content. The levels set are 
higher  for  imported  products  than  for  comparable  domestic  products.  This  discriminatory 
effect is not in line with the acquis, the Customs Union or WTO rules. The need to abolish 
discriminatory taxation practices is the key to further progress in the accession negotiations on 
this chapter. 

There has been some progress on direct taxation. Turkey amended the Personal Income Tax 
Law  to  comply  with  the  revised  Corporate  Tax  Law.  This  amendment  and  adoption  of  the 
implementing legislation for  domains such as transfer  pricing  are  positive  developments  for 
addressing harmful tax practices and for respecting the principles of the code of conduct for 
business  taxation.  Turkey  will  need  to  avoid  introducing  any  measures  contradicting  the 
principles of the Code of Conduct for business taxation.  

Some  progress  can  be  reported  in  the  field  of  administrative  cooperation  and  mutual 
assistance.  The  semi-autonomous 
recently  established 
Directorate-General  for  Revenue  Policy  continued  improving  their  administrative  capacity. 
The  revenue  administration  published  its  second  tri-annual  strategic  plan  with  performance 
indicators. 

revenue  administration  and 

Turkey has made some progress as regards operational capacity and computerisation. All 
provincial  tax  offices  have  been  computerised.  The  large  taxpayer  unit  is  fully  operational. 
Taxpayers file 99% of their tax returns electronically. Improvements in taxpayer services to 
encourage  voluntary  compliance  are  continuing,  with  the  establishment  of  the  taxpayer 

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services  unit,  taxpayer  call  centre  and  taxpayer  services  centre.  The  revenue  administration 
has  developed  an  electronic  tax  database  and  risk-analysis  system.  The  banderol  tracking 
system  on  tobacco  and  alcoholic  products  is  fully  operational.  Turkey’s  tax  revenue  has 
increased, but measures for reducing the informal economy still need to be reinforced. 

Conclusion 

There  has  been  little  progress  towards  improving  Turkey’s  legislative  alignment  in  this 
chapter.  However,  discriminatory  taxation  of  alcoholic  and  tobacco  products  persists. 
Modernisation  of  the  Tax  Administration  has  continued,  leading  to  improved  service  to  the 
taxpayer and increase in revenue. 

4.17.  Chapter 17: Economic and monetary policy 

There  has  been  little  progress  in  the  area  of  monetary  policy.  The  Capital  Markets  Board 
abolished the requirement whereby private pension funds must invest a minimum percentage 
of the premiums they collect in Turkish government debt instruments. In the area of monetary 
policy, Turkey is not yet sufficiently aligned with the acquis. The government and the Central 
Bank  of  Turkey  set  the  inflation  target  jointly.  The  Central  Bank  sets  limits  for  credit  card 
interest rates. The Central Bank started the process for the re-introduction of the Turkish Lira 
(TRL) leading to the replacement of the New Turkish Lira as of 1st January 2009. The Central 
Bank’s  statute  has  to  be  revised  in  order  to  ensure  full  independence  of  the  Bank.  The 
Banking  Law  allows  for  the  disbursement  of  advance  payments  to  the  Savings  Deposits 
Insurance  Fund  from  the  Central  Bank.  This  provision  is  not  in  line  with  the  prohibition  of 
monetary  financing  of  the  public  sector.  As  for  the  prohibition  of  privileged  access  by  the 
public  sector  to  financial  markets,  there  are  several  provisions  requiring  the  purchase  of 
public securities. 

Some  progress  has  been  made  in  the  area  of  economic  policy.  The  government  adopted  an 
action  plan  for  2008  –  2012.  The  authorities  completed  some  key  legislative  steps,  in 
particular  by  adopting  the  social  security  law,  the  law  on  incentives  for  research  and 
development,  and  an  employment  package  to  improve  labour  market  conditions.  Turkey 
submitted a Pre-Accession Economic Programme (PEP) to the Commission. The authorities 
published a Medium-Term Fiscal Framework (MTFF) for 2008 – 2012, which sets medium-
term public debt and budget deficit targets after the expiry of IMF stand-by arrangement in 
May.  

Formulation and implementation of economic policy remained fragmented, despite efforts to 
improve co-ordination activities.  

Conclusion 

Some progress can be reported in the area of economic and monetary policy. Economic policy 
formulation  and  implementation  remained  fragmented.  Little  progress  has  been  made  in  the 
field  of  monetary  policy.  Several  shortcomings  still  exist,  in  particular  regarding  full 
independence of the central bank, the prohibition of monetary financing of the public sector 
and the prohibition of privileged access of the public sector to financial markets. 

4.18.  Chapter 18: Statistics 

Some  progress  has  been  made  in  statistical  infrastructure.  The  Official  Statistics 
Programme for 2007-2011 was updated. The programme defines standards, data compilation 

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methodologies  and  publication  schedules  for  all  official  statistics  providers.  The  Turkish 
statistical  institute  (Turkstat)  made  some  progress  in  strengthening  its  coordinating  role. 
Cooperation with main data providers should be further improved. Main data providers should 
improve their administrative capacity, including language skills. 

Some progress has been made in classifications and registers. Turkish translations of major 
EU statistical classifications are available for use by all official statistics providers. Progress 
in setting up the business register and farm register systems remained very limited. There is 
an  urgent  need  to  further  improve  the  administrative  registers  held  by  the  Ministry  of 
Agriculture.  Further  efforts  are  needed  to  finalise  the  establishment  of  a  business  register 
system. 

Significant progress has been made in sector statistics. In the area of demographic and social 
statistics, Turkey completed for the first time an address-based population registration system 
for  the  2007  population  census.  In  macro-economic  statistics,  which  is  a  key  area  for  the 
accession  negotiations  in  this  chapter,  Turkey  completed  a  major  revision  of  its  national 
accounts,  which  largely  aligned  them  with  the  European  System  of  Accounts,  ESA  95.  In 
agriculture statistics, another key element for the chapter on statistics, limited progress was 
made.  Pilot  surveys  on  vineyards,  pesticide  use  and  fruit  were  conducted.  Preparations  are 
underway  to  improve  statistics  on  crop,  livestock  and  meat  production,  as  well  as  milk 
production  and  dairy  statistics.  Efforts  need  to  be  stepped  up  in  both  these  areas.  In  social 
protection statistics, the survey on income and living conditions has been completed. As for 
labour  statistics,  progress  has  been  made  in  structure  of  earnings  and  labour  costs.  In 
education statistics, the adult education survey has been completed. Progress can be noted on 
structural  business  statistics  and  short-term  statistics.  As  regards  tourism  statistics,  field 
studies  for  the  household  domestic  tourism  survey  have  been  completed.  As  regards 
environmental statistics, progress has been made in statistics on municipal water, wastewater, 
and environmental expenditure.  

Conclusion 

There has been good progress in the area of statistics. The administrative capacity improved. 
Turkey revised its national accounts and finalised the 2007 population census through the new 
address-based  population  registration  system.  Further  progress  is  in  particular  needed  in  the 
key  areas  of  agricultural  and  macroeconomic  statistics  as  well  as  in  the  field  of  business 
registers. Cooperation with other data providers and the coordinating role of Turkstat have to 
be further strengthened.  

4.19.  Chapter 19: Social policy and employment 

There is no progress to report in the area of labour law. Shortcomings in the transposition of 
a  number  of  directives  remain;  these  include  the  limited  scope  of  application  of  the  labour 
law. Administrative capacity of the Ministry of Labour and Social Security and its affiliated 
institutions is not yet sufficiently developed. Child labour, including children working on the 
streets,  remains  a  problem.  Shortcomings  in  the  legislation  with  regard  to  child  labour  still 
persist, as outlined in the Turkey 2007 Progress Report. Turkey needs to continue its efforts to 
combat  child  labour  (See  also  the  section  on  Economic  and  Social  Rights).  In  the  area  of 
labour law, Turkey is not yet sufficiently prepared.  

There has been some progress in the area of health and safety at work, where Turkey has 
attained a good degree of alignment with the acquis. The Labour Law was revised to prohibit 

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workers without the relevant vocational training qualifications from being employed in heavy 
and risky work. The implementing regulation on health and safety measures on risks related to 
chemical  agents  was  amended  and  came  into  force  in  March  2008.  The  Labour  Inspection 
Board  started  harmonising  its  inspection  practices  and  further  improved  its  capacity. 
However,  major  shortcomings  remain.  In  particular,  legislation  to  transpose  the  Framework 
Directive  has  not  yet  been  adopted.  Existing  legislation  does  not  cover  all  workers  in  the 
private sector and excludes workers in the public sector. Statistics reveal that there has been a 
significant  increase  in  fatal  occupational  accidents  and  diseases  in  particular  in  the  Tuzla 
shipyards.  Further  efforts  to  implement  the  legislation  are  needed  including  through 
awareness-raising,  training  and  strengthening  the  capacity  of  the  inspection  bodies. 
Preparations in this field have started. 

As  regards  social  dialogue,  there  has  been  limited  progress.  Tripartite  social  dialogue 
meetings  were  more  frequent  in  the  reporting  period;  however,  the  Economic  and  Social 
Council does not meet  regularly as required by the law. There has also been  some  progress 
regarding  bipartite social  dialogue  in  certain  sectors; however, establishing autonomous  and 
bipartite social dialogue structures at all levels is still outstanding, and the number of workers 
covered  by  collective  agreements  is  still  low.  Full  trade  union  rights  have  not  yet  been 
established in Turkey. The draft legislation aimed at bringing the currently applicable Trade 
Union  and  Collective  Bargaining,  Strike  and  Lockout  Laws  into  line  with  ILO  and  EU 
standards is still pending(see also the section on Economic and Social Rights). In the area of 
social dialogue Turkey is not yet sufficiently prepared. 

There  has  been  progress  in  the  area  of  employment  policy.  An  Employment  Package  was 
adopted in May 2008 aiming to address unemployment challenges, with a specific focus on 
the promotion of job opportunities for women, young people and people with disabilities. For 
instance,  the  amendments  stipulate,  among  other  things,  that  the  employers'  share  of  social 
security  premiums  for  newly  hired  women  employees  are  to  be  covered  by  the 
Unemployment Insurance Fund for a five-year period, starting with 100% in the first year and 
ending with 20% in the fifth. Unemployed persons registered with the Turkish Employment 
Agency  (IŞKUR)  will  benefit  from  job  matching,  guidance  and  vocational  training,  to  be 
funded  by  the  Unemployment  Insurance  Fund.  IŞKUR  continued  its  efforts  to  improve  its 
institutional capacity and the services provided to job seekers. Turkey also declared 2008 as 
the year for combating undeclared work. 

However, problems remain. In 2007, the unemployment rate remained stable at 9.9 %, but the 
overall employment rate – at 43.1% – again decreased slightly compared to 2006. The labour 
market  is  characterised  by  low  labour  force  participation  (47.8%  in  2007)  and  low 
employment  rates,  in  particular  for  women  (22.2%  in  2007),  and  high  levels  of  youth 
unemployment (19.6% in 2007). The large size of the informal economy (a little under half of 
those  in  employment  are  not  registered  with  any  social  security  institution)  and  the  marked 
rural/urban divide in the labour market remain the main challenges. No further progress was 
made  in  finalising  the  Joint  Assessment  Paper  on  Employment  Policy  Priorities  (JAP):  no 
agreement  has  yet  been  reached  on  how  to  address  the  employment  issues  affecting 
vulnerable groups. In the area of employment, Turkey is not yet sufficiently prepared. 

Good  progress  can  be  reported  on  the  preparations  for  the  European  Social  Fund  (ESF) 
through  the  implementation  of  the  component  on  Human  Resources  Development  of  the 
Instrument for Pre-Accession Assistance (IPA). In December 2007, the Commission adopted 
the Human Resources Development Operational Programme. Its aim is to support activities in 
the areas of employment, education and training, and social inclusion. The Ministry of Labour 

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and  Social  Security  has  established  the  internal  structures  necessary  for  the  management  of 
the  Operational  Programme,  staff  have  been  assigned  and  staff  training  has  been  provided. 
The Turkish authorities have accredited the management and control system for implementing 
IPA  on  a  decentralised  basis  and  have  requested  the  conferral  of  management  powers.  To 
mobilise  stakeholders,  awareness  raising  events  were  organised.  However,  administrative 
structures  and  legislation  are  not  yet  sufficiently  adapted  in  order  to  build  up  adequate 
institutional  capacity  for  the  future  management,  implementation,  monitoring,  audit  and 
control of ESF-type measures. Preparations in this area are starting. 

There  has  been  limited  progress  in  the  field  of  social  inclusion.  The  Social  Insurance  and 
General Health Insurance Law entered into force in October 2008. It provides general health 
insurance coverage for everyone under 18 years of age. This includes foreign nationals who 
have  resided  in  Turkey  for  more  than  a  year  and  who  do  not  have  social  insurance  in  their 
home countries. The health premiums of those who cannot afford to pay are to be covered by 
the State. As part of the Employment Package, social security premiums for the disabled will 
be covered by the State to promote the employment of people with disabilities.  However, a 
high incidence of poverty persists in rural areas as well as among employed people (working 
poor)  and  children.  No  further  progress  was  made  in  finalising  the  JIM  (Joint  Inclusion 
Memorandum):  no  agreement  has  yet  been  reached  on  how  to  address  issues  of  social 
inclusion  of  vulnerable  groups.  Sound  mechanisms  are  still  outstanding  for  monitoring 
poverty and social inclusion, as well as the implementation of social inclusion policies, so as 
to measure progress. Preparations in this area are at an early stage. 

In the field of social protection, some progress has been achieved. The most significant pillar 
of the social security reform, the Social Insurance and General Health Insurance Law, entered 
into force in October 2008. Its aim is to regulate, among others, the pension parameters and 
the  general  health  insurance  system  with  a  view  to  ensuring  adequate  and  sustainable 
pensions.  The  Social  Security  Institution  has  been  strengthening  its  capacity  to  deliver 
decentralised  one-stop  services  for  disadvantaged  people.  However,  there  has  been  no 
development as regards new legislation on social assistance and services. Preparations in this 
area have started. 

As  regards  anti-discrimination  and  equal  opportunities,  limited  progress  was  achieved. 
Women's  employment  rates  and  access  to  education  are  the  lowest  among  the  EU  Member 
States  and  the  OECD  countries.  Important  general  principles  and  definitions,  such  as  the 
definition  of  direct  and  indirect  discrimination,  are  lacking  in  national  law.  The  acquis 
concerning discrimination on grounds of racial or ethnic origin, religion or belief, disability, 
age  and  sexual  orientation  has  not  yet  been  transposed.  An  effective  and  independent 
"Equality  Body"  still  needs  to  be  established  to  promote  non-discrimination  and  equal 
treatment (see also Section on Economic and Social Rights). Preparations in the field of anti-
discrimination are at an early stage. 

Conclusion 

Overall, Turkey has made some progress in the field of social policy and employment through 
the  adoption  of  the  Employment  Package  and  the  Law  on  Social  Insurance  and  General 
Health Insurance. However, ensuring full trade union rights and combating undeclared work 
require particular attention. Further efforts are also needed in order to combat child labour as 
well as to update and finalise the JAP and JIM documents. Gender equality in economic and 
social life as well as policies to support social inclusion should be improved. In view of ESF 
preparations,  there  is  a  need  to  step  up  the  preparations  for  effective  implementation  of  the 

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Human  Resources  Development  component  of  IPA.  In  general,  there  is  a  need  to  increase 
administrative capacity for the effective implementation of the acquis. 

4.20.  Chapter 20: Enterprise and industrial policy 

Turkey  made  further  progress  with  regard  to  enterprise  and  industrial  policy  principles. 
The revised SME Strategy and SME Action Plan covering the period 2007-2009, which were 
published  in  November  2007,  are  largely  in  line  with  EU  policy  principles,  including  the 
Lisbon  strategy.  The  Ministry  of  Industry  and  Trade  published  investment  programmes  for 
small industrial estates and organised industrial zones. Both programmes included, as criteria 
for the selection of projects, the ability to facilitate or contribute to the policies and priorities 
set  for  EU  accession.  The  Coordination  Council  for  the  Improvement  of  Investment 
Environment  (YOIKK)  adopted  a  new  action  plan  which  consists  of  a  long  list  of  actions 
drawn up by 12 technical committees. Turkey has made preparations for the establishment of 
a  revised  industrial  strategy;  however,  no  industrial  strategy  document  has  yet  been  issued. 
Turkey  does  not  have  sufficient  mechanisms  for  the  monitoring  and  evaluation  of  existing 
policy strategies and action plans. 

There  was  further  progress  in  improving  the  business  environment.  Improvements  include 
better  systems  for  paying  taxes  and  trading  across  borders;  a  cut  in  corporate  income  tax; 
introduction of electronic customs procedures; legislative amendments regarding the setting-
up  of  business  and  working  licences;  a  new  Law  on  Research  and  Development  which 
includes tax reductions on R&D and incentive schemes. 

Some  progress  was  made  with  respect  to  enterprise  and  industrial  policy  instruments.  A 
new  decision  was  issued  on  financial  support  extended  by  the  Small  and  Medium-sized 
Industry  Development  Organisation  (KOSGEB)  by  increasing  the  upper  limit  for  loans, 
extending  the  maturity  date  and  allowing  all  domestic  and  foreign  banks  to  take  part  in 
KOSGEB’s  lending  schemes,  based  on  protocols  to  be  signed  with  this  institution.  Turkey 
officially joined the Competitiveness and Innovation Programme CIP in 2008. The decision 
by  the  Turkish  authorities  on  ratifying  the  Memorandum  of  Understanding  is  still  pending. 
This  is  preventing  the  signing  of  project  contracts  and  the  start  of  operations.  No  further 
progress has been made with regard to completing alignment with EC Directive 2000/35 on 
combating late payment in commercial transactions. 

Some  progress  has  been  made  in  sector  policies.  Turkey  has  reviewed  the  national 
restructuring  programme  concerning  both  the  state  aid  aspects  and  the  market  analysis  and 
forecast of the Turkish steel industry The Ministry of Industry and Trade published a strategy 
for textile, clothing and leather sectors, which aims at improving the competitiveness of these 
sectors and managing their transformation process. Turkey continued its privatisation efforts 
in the reporting period. The total volume of privatisation revenue achieved between July 2007 
and May 2008 was € 4.93 billion, which corresponds to 1% of GDP in 2007, as compared to 
1.5% in 2006. 

Conclusion 

Turkey has made some further progress in this chapter. This relates to the adoption of a new 
SME  Strategy  and  Action  Plan,  improvements  in  the  business  environment  and  continuing 
high  foreign  direct  investment  inflows  in  2007.  There  is  not  a  sufficient  monitoring  and 
evaluation mechanism in place to assess progress on various policy action plans and strategy 

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documents. Turkey has not adopted a revised comprehensive industrial strategy. Turkey has 
achieved a reasonable alignment with the acquis in this chapter. 

4.21.  Chapter 21: Trans-European networks 

Turkey is advancing in the area of transport networks and made further progress during the 
reporting period.  The Transport Infrastructure Needs Assessment (TINA) has been  finalised 
and will provide an agreed basis for the future definition and development of the TEN-T in 
Turkey. Projects preparation is ongoing. However, there is a need for a more reliable system 
of classified transport data. 

In  the  area  of  energy  networks,  the  European  Community  is  supporting  preparations  for 
projects aimed to strengthen a competitive electricity and gas market in the EU, as well as to 
improve its security of supply. The Nabucco natural gas pipeline project from the Caspian and 
Central Asian region to Europe via Turkey is among the highest priority projects of the EU. 
The Turkish authorities have repeatedly confirmed their commitment to the realisation of the 
project. Relevant planning and design are being prepared and are expected to be finalised in 
early  2010.  The  partner  countries  in  the  project  are  working  on  an  inter-governmental 
agreement  with  the  aim  of  bringing  the  pipeline  into  operation  as  early  as  possible.  The 
Turkey-Greece  pipeline  became  operational,  with  a  transport  capacity  of  750  million  cubic 
metres  annually.  Technical  preparations  to  bring  the  Turkey-Greece-Italy  Interconnector 
natural gas pipeline into operation are continuing. 

As  regards  electricity  networks,  links  are  in  place  with  Bulgaria,  Syria,  Iraq,  Iran  and 
Azerbaijan,  Iran  and  Georgia.  Further  interconnections  with  the  European  Power  Network 
UCTE (Union  for  the Co-ordination of Transmission of Electricity) are encouraged. Turkey 
gives priority to a number of projects which contribute to the completion of priority axes No.4 
(Greece-Balkan  Countries  UCTE  system)  and  No.9  (Mediterranean  Electricity  Ring)  of  the 
"EU Projects of European Interest". In June 2008, the construction of the Babaeski (Turkey) – 
Filippi  (Greece)  line  has  been  completed  and  will  allow  electricity  transfer  between  both 
countries.  

No progress can be reported in the area of telecommunication networks. Preparations in this 
area are at an early stage. 

Conclusion 

Turkey  made  some  progress  in  the  area  of  trans-European  networks.  Preparations  for  the 
Nabucco natural gas pipeline have started. 

4.22.  Chapter 22: Regional policy and coordination of structural instruments 

As regards the legislative framework Turkey made progress, with the law on Development 
Agencies  (DA)  coming  into  force  in  November  2007.  This  followed  the  publication  of  the 
decision  and  justification  by  the  Constitutional  Court  on  a  lawsuit  for  the  suspension  of 
implementation  and  the  cancellation  of  certain  articles  of  the  said  Law.  While  annulling 
provisions  of  the  DA  law  on  staff  appointment  and  tax  exemption,  the  Constitutional  Court 
decision  does  allow  the  full  operation  of  two  existing  Development  Agencies  (in  Izmir  and 
Adana)  and  the  establishment  of  new  ones.  The  Constitutional  Court  ruling  and  its 
justification  will  be  implemented  by  the  Council  of  State.  Regarding  IPA,  the  Competent 
Accrediting Officer and the Audit Authority were designated in November 2007, and the IPA 

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Framework  Agreement  with  Turkey  was  signed  in  July  2008  and  remains  to  be  ratified. 
Preparations in this area are advancing slowly. 

As  regards  the  institutional  framework,  some  limited  progress  was  made.  The  State 
Planning Organisation started to play a coordinating role in regional policy in the context of 
the  new  instrument  for  pre-accession  (IPA),  the  pre-cursor  of  the  Structural  and  Cohesion 
Funds.  Operating  Structures-OS  (future  managing  authorities)  have  been  designated  for  the 
three operational programmes (OP) of component III – Regional Development of IPA and for 
the  Human  Resources  Development  operational  programme  under  component  IV.  During  a 
transition period until 2010, the Central Financing and Contracts Unit (CFCU) will be used as 
the  implementing  agency  for  the  tendering,  contracting,  payment,  accounting  and  financial 
reporting  aspects  under  components  III  and  IV.  A  Cooperation  Agreement  was  prepared  in 
2007 in order to set out the division of tasks between the OS and the CFCU. So far, no formal 
mechanism,  such  as  an  inter-ministerial  committee  for  regional  development,  has  been 
established for the coordination function. Preparations for decentralised management of IPA 
funds  under  the  regional  development  and  human  resources  development  components  have 
been  significantly  delayed.  One  year  after  the  adoption  of  the  programmes  by  the  Turkish 
authorities their implementation has not started. Turkey has not yet initiated preparations for 
implementation  systems  for  the  future  Structural  and  Cohesion  Funds.  Preparations  in  this 
area are slowly advancing. 

There  has  been  limited  progress  on  administrative  capacity.  The  training  and  technical 
assistance  provided  and  on-going  through  EU  assistance  for  the  preparation  of  the 
implementation  of  operational  programmes  under  IPA  is  essentially  confined  to  the  central 
level,  where  some  capacity  has  been  built  up  in  the  ministries  that  were  designated  as 
operating structures. Administrative capacity at regional level continues to be weak; reasons 
for this include the suspension of the DA law and the failure to establish regional structures. 
Involvement of local/regional administrations and stakeholders in programme implementation 
remains very limited. Preparations in this area are slowly advancing. 

As  regards  programming,  good  progress  was  made.  The  State  Planning  Organisation  has 
prepared  the  Strategic  Coherence  Framework  (SCF)  which  sets  out  Turkey’s  strategy  for 
implementing  components  III  and  IV  of  IPA  over  the  period  2007-2013,  in  response  to  the 
Commission’s  multi-annual  indicative  programme  (MIPD).  The  SCF  has  been  submitted  to 
the  Commission  and  four  operational  programmes  (OPs)  to  implement  the  strategy  -  which 
concern  environment,  transport  and  regional  competitiveness  for  component  III  and  human 
resources  development  for  component  IV  -  were  prepared  by  the  respective  ministries 
(environment,  transport  and  industry  and  trade  for  component  III  and  labour  for  component 
IV).  OPs  were  submitted  to  and  approved  by  the  Commission  in  November  and  December 
2007. Necessary preparatory work on the project pipeline, in particular for the OP on regional 
competitiveness, remains limited. Preparations in this area are slowly advancing. 

Progress  was  made  in  the  monitoring  and  evaluation  of  the  operational  programmes. 
Operating  structures  have  set  up  sectoral  monitoring  committees  (SMC)  to  monitor  the 
implementation  of  OPs.  The  first  two  SMC  meetings  for  each  OP  were  held  in  November 
2007 and June 2008. The membership and rules of procedure of the SMCs have been agreed 
with the Commission. The first meeting of the (all components) joint IPA committee was held 
in  July  2008.  Each  Operating  Structure  has  set  up  "programme  coordination  and 
implementation  centres"  to  carry  out  the  actual  implementation  of  each  programme.  These 
"centres" will also be responsible for evaluating the programmes. Preparations in this area are 
slowly advancing. 

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Some  progress  can  be  reported  in  the  area  of  financial  management  and  control  (see 
chapter  32  –  Financial  control),  with  the  establishment  of  relevant  systems  and  procedures 
under  IPA  components  III  and  IV.  Turkey  has  not  started  preparations  for  financial 
management and control systems for the future Structural and Cohesion Funds. . Preparations 
in this area are slowly advancing. 

Conclusion 

Progress  can  be  reported  in  adapting  the  legal  framework,  in  setting  up  implementation 
structures  for  implementing  IPA  components  III  and  IV,  and  in  adopting  four  operational 
programmes.  Further  improvement  is  needed  as  regards  administrative  capacity  at  central 
level in order for designated ministries to be able to take over all functions of the operating 
structures efficiently. At regional level, structures and administrative capacity need to be built 
up.  Ownership  and  accountability  need  improvement,  including  examination  of  the 
distribution  of  responsibilities  between  ministries  at  both  central  and  regional  levels  and 
stronger  involvement  of  local/regional  administrations  and  stakeholders.  Overall,  Turkey's 
alignment with the acquis in this chapter is not very advanced. 

4.23.  Chapter 23: Judiciary and fundamental rights 

There has been some progress on the judiciary. 

As regards the independence of the judiciary, the selection procedure laid down in the Law on 
judges and prosecutors was amended in December 2007. These amendments transferred into 
law  the  provisions  of  the  relevant  June  2007  regulation  of  the  Ministry  of  Justice.  They 
include  specific  selection  criteria  and  a  transparent  scoring  system  and  are,  therefore, 
considered  an  improvement.  However,  criticism  has  been  voiced  by  bar  associations  and 
academics that the new selection criteria are open to subjective interpretation. Two opposition 
parties  applied  to  the  Constitutional  Court  for  annulment  of  certain  provisions  of  the  new 
legislation. 

As a result of the November 2007 examinations, the Justice Academy recruited 387 candidate 
judges and prosecutors. Another 397 were recruited following the March 2008 examinations. 
Three  more  examinations  were  planned  in  2008.  However,  in  response  to  an  appeal  by 
YARSAV27  in  March  2008,  the  Council  of  State  suspended  the  recruitment  of  a  number  of 
candidate judges and prosecutors. The Council of State decided that the assessment protocol 
signed  between  the  Ministry  of  Justice  and  the  Student  Selection  and  Placement  Centre 
outlining the procedure for the examination does not comply with the legislation in force. The 
Council of State is due to issue its final decision on the case. 

There  has  been  no  progress  on  the  composition  of  the  High  Council  of  Judges  and 
Prosecutors28 or on the reporting lines of judicial inspectors29. 

27 
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29 

YARSAV is an association of judges and prosecutors. 
The  composition  of  the  High  Council  is  not  representative  of  the  judiciary  as  a  whole;  only  senior 
members  of  the  judiciary  from  the  Court  of  Cassation  and  the  Council  of  State  are  members  of  this 
Council. 
The judicial inspectors, who are responsible for evaluating the performance of judges and prosecutors, 
are attached to the ministry rather than to the High Council. 

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Concerns remain about the impartiality of the judiciary. On occasions, senior members of the 
judiciary or high courts made public comments which sparked a debate in the country that the 
judiciary was going beyond its remit and taking positions on political issues. 

In relation to the professionalism and competence of the judiciary, the Ministry of Justice and 
the Judicial Academy continued to provide training for judges, prosecutors and prison staff. 
This covered issues such as the fight against organised crime, women's rights and, in general, 
the fundamental rights guaranteed by the ECHR and the case law of the ECtHR. However, the 
Justice  Academy  still  has  not  developed  into  a strong and independent training provider for 
the entire magistracy, including at regional level. Representatives of civil society have pointed 
out  the  need  to  provide  training  not  only  on  substantive  legal  issues  but  also  on  issues  of 
procedural justice. 

As  regards  the  efficiency  of  the  judiciary,  judges  and  lawyers  have  reported  positive  results 
from the national judicial network project (UYAP) on court proceedings. Software has been 
developed for use by the provincial probation units in their daily work. UYAP has been made 
available to the national security police so that it can conduct research on persons for whom 
an arrest warrant has been issued. Lawyers are also reportedly using the system increasingly 
following integration of their portal into the network in March 2007. 

In 2007 a total of 846 judges and prosecutors were appointed. The total number of judges and 
prosecutors  on  1  May  2008  was  6 914  (6 785  on  1  May  2007)  and  3 917  (3 744  on  1  May 
2007)  respectively.  On  the  same  date  (1  May  2008)  the  total  number  of  vacant  posts  for 
judges  and  prosecutors  was  4 166.  The  funds  available  to  the  judiciary  in  2007  totalled  € 
865 million.  This  covers  salaries  and  social  security  payments  for  all  members  of  the 
judiciary, plus services and real estate acquisition. 

However, there have been no developments on establishment of the regional courts of appeal. 
This is a matter of concern. Under the law, these should have been operational by June 2007. 
In addition, provisions introduced under the Criminal Procedure Code, such as return of the 
indictment, mediation and cross-examination, have not been used sufficiently in practice. 

There  have  been  some  developments  in  the  area  of  judicial  reform.  In  spring  2008,  the 
Ministry of Justice put a draft strategy on its website. This comprehensive document covers 
issues related to the independence, impartiality, efficiency and effectiveness of the judiciary, 
enhancement  of  its  professionalism,  the  management  system  and  measures  to  enhance 
confidence  in  the  judiciary,  to  facilitate  access  to  justice  and  to  improve  the  penitentiary 
system. A meeting took place in Antalya, from 20 to 25 May, with judges and prosecutors to 
discuss all aspects of the draft strategy. Further and wider consultations with all stakeholders, 
including  civil  society,  and  efforts  to  build  the  necessary  confidence  are  needed  for 
sustainable development and implementation of judicial reform. 

Limited progress can be reported on anti-corruption. Turkey has implemented one third of 
the recommendations made in GRECO's 2005 joint first and second round evaluation report. 
The  Ministerial  Committee  for  enhancing  transparency  and  improving  good  governance  is 
continuing to monitor anti-corruption measures. Corruption incidents, involving in particular 
real estate agencies, local government and universities, were frequently reported by the media. 
As  a  result,  law  enforcement  agencies  have  conducted  a  series  of  high-profile  corruption 
investigations in various agencies. 

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As  regards  Members  of  Parliament  and  political  parties,  there  is  no  legislation  in  place  on 
election campaign financing. There has been no development on limiting the broad scope of 
parliamentary  immunity.  The  European  Court  of  Human  Rights  noted  in  a  ruling  that  no 
objective criteria had been set to define the conditions under which immunity could be lifted. 
Financial  relations  between  political  parties  and  the  media  raise  questions.  The  system  of 
auditing political parties is not considered adequate.  

Ethical  principles  for  Members  of  Parliament  and  other  groups  of  public  officials,  such  as 
academics, the military or the judiciary, are lacking. Certain groups of public officials, such as 
academics,  under-secretaries  and  governors,  continue  to  benefit  from  a  system  of 
administrative authorisation for corruption prosecution. 

Several of GRECO's most important recommendations have not been addressed, such as the 
recommendation to entrust a body involving civil society with the responsibility of overseeing 
implementation of national anti-corruption strategies and of proposing new strategies. 

No  progress  has  been  made  regarding  new  legislation  on  the  Court  of  Auditors,  nor  on 
strengthening parliamentary oversight over public expenditure. 

Concerning transparency in public administration, increasing use has been made of the right 
of  access  to  information.  According  to  official  statistics,  a  total  of  939 920  requests  for 
information have been submitted by citizens. Public agencies responded positively to 93% of 
them. Both citizens' requests for information and the number of those requests public agencies 
responded to positively have increased since last year. However, in the assessment of the real 
impact  of  the  relevant  legislation  account  should  be  taken  of  the  fact  that  the  system  is 
relatively  new  and  that  the  board  of  access  to  information  does  not  check  the  reliability  of 
these statistics. Another 554 cases in which requests for information were denied have been 
referred to the judiciary.  

Turkey has been criticised by the OECD for its record on implementation of the OECD anti-
bribery convention concerning the liability of legal persons, its inadequate awareness-raising 
activities  and  its  dismissal  of  investigation  of  foreign  bribery  cases  allegedly  involving 
Turkish companies. 

Stronger coordination between the relevant government institutions is of key importance.  

As  regards  fundamental  rights,  there  has  been  some  legislative  progress  (See  also  under 
political criteria). 

There have been no developments on the institutions monitoring and promoting human rights, 
such as the Human Rights Presidency, which lack independence and resources. The Law on 
the establishment of the ombudsman is still before the Constitutional Court following the veto 
by the President of the Republic in November 2006. The Constitutional Court ordered a stay 
of  execution  of  the  Law,  but  has  yet  to  give  its  verdict.  Finally,  Turkey  has  given  no  firm 
commitment on participation in the Fundamental Rights Agency.  

As  regards  prohibition  of  torture  and  inhuman  or  degrading  treatment  or  punishment,  the 
downward trend in allegations of torture and ill-treatment in the anti-terror departments of 
police stations continued. The legal safeguards introduced by the government's zero tolerance 
policy  on  torture  are  having  a  positive  effect.  However,  the  number  of  appeals  to  NGOs 
concerning cases of torture and ill-treatment, in particular outside official places of detention, 
has  increased.  .  Pending  ratification  of  the  Optional  Protocol  to  the  UN  Convention  against 

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torture,  there  is  no  independent  national  mechanism  in  place  for  monitoring  places  of 
detention. Furthermore, more efforts are needed to fight impunity. 

With regard to respect for private and family life and, in particular, the right to protection of 
personal  data,  Turkey  needs  to  align  its  legislation  with  the  data  protection  acquis,  in 
particular  Directive  95/46/EC,  and,  in  that  context,  to  set  up  a  fully  independent  data 
protection supervisory authority. Turkey also needs to ratify both the CoE Convention for the 
protection of individuals with regard to automatic processing of personal data (CETS No 108) 
and the additional protocol to it on supervisory authorities and trans-border data flow (CETS 
No 181). 

Progress has been made on freedom of thought, conscience and religion, in particular in the 
form of adoption of the Law on foundations. Implementation of this law and resolution of the 
outstanding  property-related 
together  with 
intensification of the efforts to address the concerns of the Alevis, remain a challenge. Despite 
the progress made, a legal framework in line with the ECHR has yet to be established, which 
would enable all religious communities to function without undue constraints. This needs to 
be accompanied by stronger efforts to implement the June 2007 circular from the Ministry of 
the Interior in order to create an environment conducive to full respect of this right in practice. 

issues  regarding  non-Muslim  minorities, 

Regarding  freedom  of  expression,  including  freedom  and  pluralism  of  the  media,  there  has 
been some progress on strengthening the safeguards for freedom of expression in Turkey. In 
April, Parliament adopted amendments to Article 301 of the Criminal Code that, among other 
things,  introduce  a  requirement  for  permission  from  the  Ministry  of  Justice  to  launch  a 
criminal  investigation.  However,  the  legal  restrictions  on  freedom  of  expression  remain  a 
cause for concern. Efforts need to be enhanced and consolidated with a view to ensuring full 
respect of freedom of expression, in law and in practice, in line with the ECHR and the case 
law of the ECtHR.  

As regards freedom of assembly and association, including the right to form political parties 
and  the  right  to  establish  trade  unions,  the  legal  framework  for  freedom  of  assembly  is 
broadly  in  line  with  European  standards.  However,  banned  demonstrations  have  sometimes 
resulted in use of excessive force against demonstrators. The legal framework for freedom of 
association  improved  with  the  adoption  of  the  amendments  to  the  Law  on  foundations  in 
February  2008.  However,  the  obligations  imposed  by  the  Law  on  associations  to  notify  the 
authorities before receiving financial support from abroad and to provide detailed documents 
on  such  support  continue  to  place  a  burden  on  associations.  The  Turkish  Chief  Public 
Prosecutor applied to the Constitutional Court to close the ruling AKP and to ban members of 
the party (including President Gül and Prime Minister Erdoğan) from membership of political 
parties  for  five  years.  The  Constitutional  Court  dismissed  the  application  for  closure  of  the 
party  on  30  July,  as  the  necessary  qualified  majority  for  imposing  a  ban  was  not  reached. 
However, the Court decided to impose a financial sanction on the party on the grounds that 
some of its activities were considered in contravention of secularism. In the light of this case, 
the  legal  provisions  on  political  parties  need  to  be  amended  and  brought  into  line  with  the 
case law of the ECtHR and best practice in EU Member States, as outlined by the Council of 
Europe's Venice Commission. 

As  regards  treatment  of  socially  vulnerable  and  disabled  persons  and  the  principle  of  non-
discrimination, the State will pay social security premiums to promote employment of people 
with  disabilities.  As  regards  mental  health,  progress  has  been  made  on  implementation  of 
electro-convulsive  therapy  in  hospitals  in  line  with  human  and  patients'  rights.  However, 

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people  with  disabilities  do  not  benefit  from  adequate  public  services.  Lack  of  data  and 
research  are  preventing  informed  policy-making.  Community-based  services  are  not 
sufficiently developed. Insufficient general medical care and treatment remains a problem in 
mental health hospitals and rehabilitation centres. 

Anti-discrimination  is  enshrined  in  the  constitution  and  upheld  in  several  laws.  However, 
there is no specific protection on grounds of sexual orientation in Turkish law and provisions 
of  the  Turkish  Criminal  Code  on  "public  exhibitionism"  and  "offences  against  public 
morality"  are  sometimes  used  to  discriminate  against  the  lesbian,  gay,  bisexual,  transvestite 
and transgender (LGBTT) community. In May 2008, an Istanbul court decided to close down 
an LGBTT organisation, as its statute was considered against general morality. An appeal has 
been  lodged  before  the  Council  of  State  in  this  case.  Transsexuals  and  transvestites  are 
occasionally  subjected  to  physical  assaults,  including  by  the  police.  Homophobia  has  also 
resulted  in  cases  of  physical  and  sexual  violence.  These  allegations  are  not  systematically 
followed up by prompt and effective investigation (See also Chapter 19 – Social policy and 
employment). 

With  regard  to  the  right  to  education,  net  primary  school  enrolment  increased  from  90%  in 
the  2006/2007  school  year  to  97%  in  2007/2008.  The  gender  gap in  primary  education  was 
halved  from  4.6%  to  2.3%  over  the  same  period.  The  Ministry  of  National  Education  has 
established  an  e-school  database  containing  information  on  school  attendance.  This  enables 
the ministry to identify children out of school and to try to ensure that they are enrolled or to 
provide  catch-up  education.  In  May  2008,  the  Education  Board  approved  the  catch-up 
education programme, which is designed to give a second chance to children between 10 and 
14  years  of  age  who  either  never  enrolled  or  who  dropped  out.  This  is  targeted  mainly  on 
working  and  Roma  children.  In  addition,  mobile  schools  are  trying  to  reach  out  to  children 
working  in  agriculture.  However,  children  out  of  school  remain  a  problem:  the  e-school 
database has revealed that approximately 450 000 children between 6 and 14 years of age are 
out of school. 

On right to property, adoption of the Law on foundations has been a welcome step forward. 
However,  it  does  not  address  all  the  problems  faced  by  the  non-Muslim  religious 
communities.  Implementation  of  the  law  in  line  with  the  ECHR  and  the  case  law  of  the 
ECtHR will be crucial. The outstanding issues also need to be addressed. Finally, the quality 
of the dialogue between the authorities and the communities concerned will be instrumental in 
creating an environment conducive to achieving progress. 

With  regard  to  gender  equality  and  women's  rights,  some  progress  has  been  made,  in 
particular  on  combating  honour  killings  and  domestic  violence.  Although  the  overall  legal 
framework guaranteeing gender equality is in place, further big efforts need to be made if the 
gap  between  men  and  women  in  economic  participation  and  opportunity,  educational 
attainment, access to healthcare, survival and political empowerment is to be closed. 

As regards the rights of the child, there has been progress on access to social services and the 
juvenile  justice  system.  However,  efforts  need  to  continue  in  all  areas  related  to  children's 
rights. 

With regard to liberty and security and the right to a fair trial, reports indicate that in urban 
areas  most  detainees  have  access  to  a  lawyer  immediately  after  detention.  In  rural  areas, 
however,  in  particular  in  the  south-east  of  the  country,  there  have  been  cases  where 
defendants  have  not  had  access  to  a  lawyer  on  terms  equivalent  to  those  in  urban  areas.  In 

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courts,  professional  interpretation  in  languages  other  than  Turkish  remains  an  issue  of 
concern. 

As regards minority rights and cultural rights, Turkey has made limited progress on ensuring 
respect  for  and  protection  of  minorities  in  accordance  with  European  standards.  Turkey  has 
also  made  limited  progress  in  the  area  of  cultural  rights.  Significant  further  efforts  are 
required, in particular on use of languages other than Turkish in broadcasting, in political life 
and when accessing public services. 

There have been no developments as regards EU citizens' rights. 

Conclusion 

As  regards  the  judiciary,  there  has  been  some  progress,  in  particular  on  establishment  of  a 
judicial reform strategy. However, concerns remain about the independence and impartiality 
of the judiciary. The reform strategy is expected to address these issues. 

Limited  progress  can  be  reported  on  anti-corruption.  The  government  has  continued  to 
implement  its  initiatives.  However,  there  is  no  legislation  in  place  that  would  guarantee 
transparency of election campaign financing. There has been no progress on the immunity of 
Members of Parliament. Codes of ethics and/or conduct for Members of Parliament and other 
groups of public officials are lacking and an anti-corruption strategy and action plan need to 
be developed and to receive the political support necessary for implementation. 

As regards fundamental rights, there has been some legislative progress, but vigorous further 
efforts  need  to  be  made  to  ensure  full  respect  of  the  fundamental  rights  guaranteed  by  the 
ECHR and the case law of the ECtHR. 

4.24.  Chapter 24: Justice, freedom and security 

Some progress can be reported on migration. The asylum and migration task force formed a 
high-level  working  group  bringing  together  agencies  responsible  for  border  tasks  connected 
with irregular migration. It aims for closer inter-agency cooperation by conducting common 
risk analyses. 

A  total  of  64 290  illegal  migrants  were  apprehended  in  2007  and  33,143  in  the  first  seven 
months of 2008. Capacity to accommodate illegal migrants has been increased from 1 512 to 
1 793.  

Turkey proposed a readmission agreement to Afghanistan. A first round of negotiations on a 
readmission  agreement  with  Pakistan  was  held.  However,  Turkey  has  not  pursued  the 
negotiations  on  a  readmission  agreement  with  the  European  Community  since  December 
2006. 

Limited progress can be reported on management of irregular migrants in Turkey. However, 
the  detention  and  deportation  procedures  need  to  be  improved  to  ensure  that  the  authorities 
systematically  give  written  reasons  for  such  decisions  in  a  language  the  persons  concerned 
can  understand.  It  should  be  possible  to  submit  detention  and  removal  decisions  to  a  senior 
administrative, and possibly also judicial, review. The duration of detention should be limited 
by law or – at least in cases of prolonged detention – regularly reviewed. 

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The material conditions of detention of apprehended irregular migrants during detention need 
to be improved. Facilities could be improved to ensure that detainees are segregated not only 
by gender but also by age and criminal record. Family members should have the possibility to 
stay together. 

Access for detained irregular migrants to free legal aid, to asylum procedures, to interpretation 
services,  to  psychological  and  medical  assistance  and  to  educational  and  recreational 
activities,  along  with  the  possibility  of  accommodating  unaccompanied  minors  in  reception 
facilities  outside  detention  centres,  needs  to  be  further  developed,  including  by  closer 
cooperation  between  the  national  and  international  organisations  specialising  in  delivering 
these services and the authorities managing detention facilities. 

No specific training or training curricula exist for staff working in the migration area. There is 
no compatible data system on migration. 

Arbitrary cases of refoulement, although not numerous, remain a high concern. 

In  the  area  of  asylum,  limited  progress  has  been  made.  Turkey  continues  to  impose  its 
geographical  limitation  on  the  1951  Convention  relating  to  the  status  of  refugees  and  the 
related 1967 Protocol. The Ministry of Interior continued to work with the UNHCR to train 
officials  in  preparation  for  decentralisation  of  decision-making.  The  department  for 
foreigners, borders and asylum in the Turkish  National Police has started to prepare to take 
over  the  country  of  origin  information  system.  Extensive  work  is  underway  to  improve 
administrative capacity and streamline asylum procedures. The Ministry of Interior has also 
initiated the internal administrative procedures to set up an asylum management unit, as the 
first step towards a dedicated authority able to manage both reception and integration issues.  

In  2007,  5 846  requests  for  asylum  were  made,  a  65%  increase  compared  to  2006  (3 541 
applications).  In  the  first  eight  months  of  2008  another  2 364  applications  were  registered. 
The  total  number  of  applications  being  processed  (investigation  phase)  increased  to  15562 
(6 622  Iraqis,  5 449  Iranians,  1 260  Somalis,  1 279  Afghans  among  others).  So  far, 
44 applicants have been granted refugee status. The Turkish government spent the equivalent 
of USD 550 000 in 2007 (compared with USD 135 000 in 2006) to cover the basic needs of 
all asylum seekers – recognised refugees and “temporary asylum seekers” or “guests”.  

Given  the  increase  in  the  number  of  asylum  applications  to  Turkey,  the  revision  of  the 
Asylum Law and the establishment of the new asylum unit are important. Pending these two 
structural  reforms,  fair,  equal  and  consistent  access  for  everyone  to  asylum  procedures,  to 
legal aid and, in particular, to UNHCR staff, especially at Turkey’s international airports and 
detention centers, is crucial. Another important task is to reduce the waiting time for asylum 
procedures  and  to  eliminate  disparities  between  cities’  mechanism  for  referral  to  the  social 
solidarity foundation.  

Training for Turkish officials on refugee status determination procedures needs to continue. 
Measures  need  to  be  taken  to  ensure  that  trained  staff  remains  within  the  asylum  and 
migration  system.  Mobilisation  of  and  cooperation  with  NGOs  and  local  authorities  are  the 
keys to integration of asylum seekers. Another important point is to facilitate the self-reliance 
of refugees by reducing the fees for the six-month temporary residence permit. 

No progress can be reported on visa policy. Sticker- and stamp-type visas are still issued at 
borders,  with  different  authorities  responsible  for  the  issuing  procedures,  and  airport  transit 
visas have not been introduced. Following the training received by 200 staff in 2007, there has 

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been  a  slight  increase  in  the  detection  rate  for  forged  documents.  In  2007,  493  documents 
were  identified  as  false  and  falsified,  compared  with  469  in  2006.  No  development  can  be 
reported on alignment with EU visa lists. There are several countries on the EU's negative list 
whose citizens can enter into Turkey without a visa. Citizens of 16 Member States are under a 
visa obligation when travelling to Turkey. 

There has been limited progress on alignment with the acquis concerning external borders 
and  Schengen.  The  number  of  border  crossing  points  has  been  increased  from  116  to  120. 
Modernisation  of six border crossing points was completed in 2008; work is in  progress on 
five more. A "Common Manual of Checks at the EU external borders" was published in 1500 
copies  and  distributed  for  the  use  of  the  organisations  performing  border  duties  (General 
Staff,  National  Police,  Customs  Undersecretary,  Gendarmerie  and  the  Coast  Guard).  The 
manual will serve the purpose of being used as a practical tool to integrate EU requirements 
while  carrying  out  their  tasks.  However,  border  staff  shows  very  limited  awareness  of  the 
Turkish national strategy on integrated border management or of the action plan to implement 
it.  Efforts  need  to  be  stepped  up  and  systemised  with  a  view  to  implementing  the  national 
action plan on integrated border management. The inter-agency group put in place to discuss 
implementation of the action plan has met only occasionally. In the absence of the new border 
law  enforcement  authority,  it  is  crucial  further  to  enhance  cooperation  between  all  agencies 
working  at  borders  by  developing  joint  risk  analyses,  exchanges  of  information  and 
cooperation on investigation and training. To provide specialised training, a new department 
on border security studies has been established within the police academy. Further emphasis 
needs  to  be  placed  on  the  training  and  professionalism  of  the  border  police,  especially  on 
development of language skills.  

The data on EU citizens’ entry documents raise concerns, as they are not in line with the EU 
acquis.  Closer  cross-border  cooperation  with  neighbouring  countries  is  a  key  component  of 
well-functioning border management.  

As  regards  judicial  cooperation  in  civil  matters,  a  new  Law  on  international  private  and 
procedural law has been adopted. A Law implementing the 1980 Hague Convention on child 
abduction was also adopted.  

No  progress  can  be  reported  on  judicial  cooperation  in  criminal  matters.  Cooperation  is 
ensured by means of international and bilateral agreements and, in the absence there, on the 
basis  of  reciprocity  and  international  customary  law.  Key  pending  issues  are  related  to 
effective  implementation  of  relevant  Council  of  Europe  conventions,  especially  on  mutual 
legal assistance and on extradition. Turkey has not signed key international conventions, such 
as  the  Second  Additional  Protocol  to  the  Council  of  Europe  Convention  on  mutual  legal 
assistance or the Convention on cybercrime. Turkey needs to take the necessary steps to sign 
a cooperation agreement with Eurojust.  

In the area of police  cooperation, limited progress has been achieved. A  code  of ethics for 
law  enforcement  agents  in  line  with  international  standards  has  been  adopted.  Turkey  has 
signed  a  number  of  bilateral  agreements  on  police  cooperation.  The  lack  of  legislation  on 
protection  of  personal  data  and  the  absence  of  an  independent  supervisory  authority  is 
obstructing the conclusion of an operational cooperation agreement with Europol (a strategic 
cooperation  agreement  has  been  in  force  since  2004).  This  also  creates  difficulties  when  it 
comes to cooperating at international level. Closer cooperation and communication between 
law enforcement agencies, and also with the judiciary, is of key importance.  

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Some  progress  has  been  observed  in  the  fight  against  organised  crime.  A  new  Law  on 
witness protection was adopted, with adequate provisions to guarantee the confidentiality of 
their  identity  and  their  security.  This  is  expected  to  improve  the  chances  of  convictions  in 
organised crime cases. The Regulation on the principles and procedures governing controlled 
delivery was extended to include the coast guard and the customs administration, in addition 
to  the  gendarmerie  and  the  police.  Following  adoption  of  a  Law  on  cybercrime,  an  internet 
department  was  established  under  the  telecommunications  authority  to  take  charge  of 
monitoring,  supervision  and  coordination  and  some  implementing  legislation  was  adopted. 
Expertise  in  forensics  is  good.  However,  establishment  of  a  national  fingerprint  and  DNA 
database and adoption of harmonised crime scene investigation  practices  remain key  issues. 
One important point is that the strategy against organised crime, in line with EU best practice, 
needs  to  be  followed  up  by  a  specific  action  plan  and  implemented  accordingly.  Special 
investigative techniques need to be developed and relevant training provided.  

Progress  has  continued  on  combating  trafficking  in  human  beings.  The  task  force  on 
combating human trafficking was systemised and expanded to include local administrations. 
Collection  of  statistics  was  standardised.  Some  308  traffickers  were  arrested  in  2007.  As  of 
September  2008,  212  traffickers  were  arrested.  The  free  emergency  helpline  and  the  two 
centres  for  victims  of  trafficking  continue  to  operate.  Further  efforts  were  made  to  promote 
the  157  helpline.  By  September  2008,  98  victims  had  been  identified,  61  of  whom  were 
returned  voluntarily  to  their  countries  of  origin  and  six  of  whom  remain  in  the  centres, 
pending procedures for their return. The Witness Protection Law entered into force. It protects 
the identity of victims of human trafficking who agree to testify against the perpetrators and 
opens  the  way  to  include  them  in  a  witness  protection  programme.  There  are  now  court 
precedents  on  the  application  of  a  recent  amendment  of  the  Penal  Code  stipulating  tougher 
penalties for human trafficking. Inter-agency cooperation could be improved with the aid of 
common  operations  and  training  activities.  It  is  of  key  importance  that  Turkey  signs  the 
Council  of  Europe  Convention  on  action  against  trafficking  in  human  beings.  Solutions 
allowing sustained funding are necessary for the free emergency helpline and for the centres. 

(For the fight against money laundering see Chapter 4). 

As regards the fight against terrorism, the Supreme Council on Counter-terrorism remains 
the  leading  authority.  Following  adoption  of  the  Law  on  the  prevention  of  laundering 
proceeds  of  crime,  implementing  legislation  was  adopted  requiring  the  report  of  suspicious 
transactions  connected  with  financing  of  terrorism  to  the  Financial  Crimes  Investigation 
Board  (MASAK).  A  special  unit  to  fight  financing  of  terrorism  has  been  established  under 
MASAK. MASAK received 144 reports of suspicious transactions connected with financing 
of terrorism in 2007, compared with 8 in 2006. Turkey has ratified neither the International 
Convention  for  the  suppression  of  acts  of  nuclear  terrorism  nor  the  Council  of  Europe 
Convention  on  the  prevention  of  terrorism.  Compliance  with  nine  special  Financial  Action 
Task Force recommendations on financing of terrorism needs to be pursued,  particularly  on 
freezing and confiscation of terrorist assets. 

Some progress has been made  in the fight against drugs. Following adoption of a national 
strategy  in  line  with  the  EU  drug  strategy  and  the  EU  drug  action  plan  for  2005-2012,  an 
action  plan  (2007-2009)  was  brought  into  force.  The  national  Reitox  focal  point  is  the 
coordinator of the action plan and chairs the coordination board meetings on a quarterly basis 
to  monitor  implementation.  The  agreement  concerning  the  participation  of  Turkey  in  the 
European Monitoring Centre for Drugs and Drug Addiction (EMCDDA) has been signed. It is 
of key importance that Turkey takes the steps necessary to ratify the agreement so that it can 

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be implemented without delay. A parliamentary commission was established to examine the 
problems  related  to  drug  addiction  and  supply  reduction.  Successful  operations  resulting  in 
sizeable  seizures  were  mounted  by  the  Turkish  law  enforcement  bodies.  Joint  action  on 
controlled deliveries was carried out. However, the mandate of the national Reitox focal point 
is  limited,  its  human  resources  capacity  is  weak  and  it  still  lacks  an  autonomous  budget.  A 
more  balanced  approach  to  drugs  supply  and  demand  reduction  needs  to  be  backed  up  by 
strengthening  cooperation  between  institutions,  developing  a  network  of  treatment  and 
rehabilitation facilities and enhancing the data collection system in Turkey. The question of 
drugs remains serious as the country is a major transiting country. 

There has been some progress on customs cooperation. The administrative and operational 
capacity  of  the  Under-secretariat  of  Customs  was  improved  by  increasing  its  scanning 
systems.  The  relevant  implementing  regulation  was  amended  to  authorise  the  customs 
administration  to  implement  controlled  delivery  in  addition  to  the  police,  gendarmerie  and 
coast guard. However, it is important to make more efforts on inter-agency cooperation and 
implementation  of  risk  management  within  the  Under-secretariat  of  Customs.  The  lack  of 
legislation on the protection of personal data and the absence of an independent supervisory 
authority remain a difficulty in cooperation at regional and international levels. 

Conclusion 

Overall, some progress can be reported, particularly to prevent drugs and human trafficking. 
Alignment  with  the  acquis  in  this  chapter  is  underway,  but  sustained  efforts  are  required  in 
areas  such  as  visa  policy  and  judicial  co-operation  in  criminal  matters.  The  same  applies  to 
the fight against organised crime, which remains a serious concern. The capacity to manage 
asylum and migration needs to be improved. Efforts need to be stepped up to implement the 
national  action  plan  on  integrated  border  management.  The  negotiations  for  an  EC-Turkey 
readmission agreement need to be re-launched. 

4.25.  Chapter 25: Science and research 

Good  progress  can  be  reported  in  the  area  of  science  and  research  policy.  A  new  law  to 
encourage  research  and  technological  development  activities  was  adopted  in  March  2008. 
(See Chapter 20 – Enterprise and industrial policy). A national human resources strategy and 
an  accompanying  action  plan  to  increase  the  number  of  researchers  and  improve  their 
distribution  by  professions  and  sectors  were  developed.  A  number  of  new  programmes 
continued  to  support  research,  technology  and  innovation,  with  increased  budgets  and 
efficiency.  Turkey’s  active  cooperation  with  the  Joint  Research  Centre  continued,  in 
accordance with the memorandum of understanding signed in July 2007.  

Turkey  continued  to  be  associated  with  the  7th  Framework  Programme  for  research  and 
technological  development  (FP7).  Its  participation  in  the  first  calls  organised  under  FP7  in 
2007 was greater than under FP6. A good number of projects were submitted and evaluated in 
the  different  thematic  areas  funded  under  FP7.  However,  in  terms  of  success  rate,  there  is 
room  for  improvement.  Turkey’s  requested  to  be  associated  with  the  Seventh  Euratom 
Research Framework Programme (2007-2013).  

As regards Turkey’s integration into the European Research Area, Turkey took several steps 
to  improve  the  mobility  of  researchers,  including  by  taking  full  part  in  EURAXESS  (the 
European  mobility  portal),  and  to  increase  investment  in  research  and  international 

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cooperation. As a result, Turkey is further integrated into the European Research Area. This 
facilitates research cooperation at European level. 

Conclusion 

Good progress has been achieved in the area of science and research. Overall, Turkey is well 
prepared in this chapter and is on track for integration into the European Research Area.  

4.26.  Chapter 26: Education and culture 

As regards education, training and youth, there has been good progress over the reporting 
period.  The  new  Lifelong  Learning  and  Youth  in  Action  programmes  attracted  a  growing 
number of applications and the National Agency responsible for these programmes continued 
to  ensure  sound  and  efficient  management.  Eighty  out  of  the  eighty-one  provinces  were 
covered  by  the  Lifelong  Learning  programme  in  2007  further  to  measures  adopted  by  the 
Turkish  authorities  and  the  National  Agency  to  encourage  the  programme's  nation-wide 
coverage. However, implementation of these programmes in 2008 has been hindered by a lack 
of funds because Turkey did not pay its total contribution in time. 

Turkey is at an advanced stage of implementation of the Bologna process reforms in higher 
education. It needs to continue its efforts towards implementation of a national qualifications 
framework improving recognition of prior learning and widening access to higher education. 

Regarding the Education and Training 2010 Work Programme, Turkey continued to improve 
its performance on early school leavers, on completion of upper secondary education, and on 
maths, science and technology graduates but not on participation of adults in lifelong learning. 
A  vocational  qualifications  authority  was  set  up.  Its  task  is  to  establish  a  national 
qualifications  system,  including  licensing,  accreditation,  assessment  and  certification 
procedures, and to link this national system to the European qualifications framework. 

Turkey continued to participate in the Culture Programme (2007–2013). The Law on Istanbul 
as the 2010 cultural capital of Europe was adopted. Turkey has signed, but not yet ratified, the 
UNESCO  Convention  on  the  protection  and  promotion  of  the  diversity  of  cultural 
expressions. 

Conclusion 

There has been good progress in the areas of education, training, youth and culture. However, 
Turkey needs to provide its total financial contribution to Community programmes in time in 
order to ensure their smooth implementation. 

4.27.  Chapter 27: Environment 

In  the  field  of  horizontal  legislation,  some  progress  can  be  reported.  The  Environmental 
Impact  Assessment  (EIA)  directive  has  been  transposed  to  a  large  degree.  However 
procedures  for  consulting  the  public  and  trans-boundary  consultations  are  not  fully  aligned. 
Turkey  has  not  yet  signed  the  Kyoto  Protocol  and  Turkey  is  not  a  party  to  the  Espoo  and 
Aarhus Conventions. The Emissions Trading Directive has not been transposed. A greenhouse 
gas  emission  trading  scheme  has  not  yet  been  established.  Transposition  of  the  Strategic 
Environmental Assessment (SEA) Directive is at an early stage. There has been no progress 
on  transposition  of  the  acquis  on  environmental  liability,  public  participation  and  public 
access  to  environmental  information.  Nor  has  Turkey  yet  started  negotiations  on  the 

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memorandum  of  understanding  with  on  its  participation  in  the  Community  civil  protection 
financial instrument. 

In the case of air quality, Turkey has made good progress in alignment with the air quality 
framework  legislation  and  daughter  directives.  Progress  has  also  been  made  on  the  sulphur 
content of liquid fuels in domestic heating systems. The administrative capacity for regional 
air quality has been improved by establishing a clean air centre in Marmara. No progress has 
been made on legislation related to the acquis on emissions of volatile organic compounds, on 
the sulphur content of certain liquid fuels or on national emission ceilings. 

Some  progress  can  be  reported  on  alignment  with  the  waste  management  acquis. 
Implementing  legislation  on  polychlorinated  biphenyls  (PCB  &  PCT)  and  on  the  control  of 
waste oils has been adopted. Furthermore, restriction of use of certain hazardous substances in 
electrical and electronic equipment and on restoration and management of extractive industry 
sites has been adopted. Alignment in this area is well advanced. However, Turkey does not 
have a national waste management plan. Progress on end-of-life vehicles and waste electrical 
and  electronic  equipment  has  been  very  limited.  No  progress  has  been  made  regarding  the 
directives on landfill.  

There has been little progress in the area of water quality. An amendment was made to the 
legislation on prevention of water pollution. However, the overall level of alignment remains 
low.  The  institutional  framework  for  water  management  is  not  organised  on  a  river  basin 
basis. Trans-boundary consultations on water issues are at an early stage.  

Limited progress can be reported on nature protection. Turkey has aligned with the acquis 
regarding  establishment  and  management  of  zoos.  However,  the  level  of  harmonisation  and 
implementation remains very low. The continuing loss of habitats is a cause for concern. The 
list  of  potential  Natura  2000  sites  has  not  yet  been  compiled.  A  framework  law  on  nature 
protection  and  implementing  legislation  on  birds  and  habitats  have  not  yet  been  adopted.  A 
national biodiversity strategy and action plan have been prepared, but not yet adopted by the 
government. 

No progress can be reported regarding industrial pollution control and risk management. 
Turkey  has  aligned  with  some  provisions  of  the  Seveso  II  Directive  and  with  the  Large 
Combustion  Plants  and  Waste  Incineration  Directives.  However,  overall  transposition  and 
implementation  remain  very  low.  Introduction  of  an  integrated  permit  system  is  at  an  early 
stage. 

There  has  been  limited  progress  in  the  field  of  chemicals.  The  legislation  on  dangerous 
chemicals has been amended. Overall, the level of transposition remains low. The capacity for 
effective implementation is insufficient. 

No progress can be reported on genetically modified organisms.  

Progress  has  been  made  in  the  field  of  noise.  Following  adoption  of  the  implementing 
legislation  Turkey  is  approaching  full  alignment  with  the  acquis  in  this  area.  However, 
preparation of noise maps and action plans is at an early stage. 

Some further progress has been made in the area of administrative capacity. A substantial 
number  of  staff  was  recruited  and  trained  by  the  Ministry  of  Environment  and 
Forestry(MoEF).  A  new  department  for  implementation  of  the  environment  programmes 
under IPA has been established in the Ministry. The Directorate-General for State Hydraulic 

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Works is now affiliated to the MoEF. However, no progress has been made on establishment 
of  a  national  environment  agency.  Responsibilities,  such  as  inspection  activities  and  nature 
protection,  are  not  clearly  defined.  Administrative  capacity  needs  further  strengthening, 
including  coordination  between  the  relevant  authorities  at  all  levels.  Mainstreaming  of 
environmental  protection  into  other  policy  areas  and  ensuring  that  new  investments  comply 
with the environmental acquis are at an early stage. Some of the existing legislation, such as 
the Mining Law, which includes gold mining, and the tourism legislation, are causing major 
damage to natural areas. 

Conclusion 

Turkey has made progress in the area of air quality and good progress on strengthening the 
administrative  capacity  at  central  level.  Some progress  can  be  reported  on  waste,  water  and 
nature protection. However, the overall level of alignment remains low. Turkey has made no 
progress  in  the  areas  of  industrial  pollution  and  risk  management  and  GMOs.  Limited 
progress  can  be  reported  on  chemicals.  Delays  in  establishment  of  the  EIA  are  hampering 
further improvements in implementation and enforcement.  

4.28.  Chapter 28: Consumer and health protection 

Turkey has made some progress in the field of consumer protection. As regards enforcement 
of  market  surveillance  legislation,  the  skills  of  relevant  personnel  have  been  enhanced 
considerably.  In  addition,  the  amount  of  the  fines  has  increased  further.  However,  reliable 
data  on  the  fines  imposed  are  lacking.  Considering  the  size  of  the  country,  the  operational 
budget  for  market  surveillance  is  small.  Turkey  is  not  applying  a  unified  method  for  data 
gathering.  The  consumer  movement  is  weak,  cooperation  and  partnership  between  the 
existing NGOs are limited and NGOs suffer from lack of funds. Their relationship with State 
bodies is weak. Preparations in this field are underway. 

Progress  has  been  made  on  product-safety  related  issues.  Awareness  of  consumer  product 
safety  amongst  the  relevant  authorities  has  increased  and  coordination  between  the  relevant 
market surveillance authorities has improved, although it still remains weak. Preparations in 
this area are on track. 

In the area of non-safety related issues, Turkey is preparing to establish an internet consumer 
portal. However, the number of legally qualified staff in the Ministry of Industry and Trade 
continues  to  lag  behind.  There  is  very  limited  follow-up  of  decisions  of  the  advisory 
Consumer  Council.  Consistent  interpretation  and  comprehension  of  consumer  legislation  by 
the courts and arbitration committees is not always ensured. Preparations in this field are on 
track. 

In  the  case  of  public  health,  Turkey  has  made  some  progress.  With  regard  to  tobacco,  an 
important amendment of the Law on Prevention of damages of tobacco products was adopted 
in  January.  It  aims  to  transpose  the  tobacco  advertising  directive  and,  beyond  this,  it  bans 
internet sales of tobacco, and smoking scenes in films on screen. The law also extended the 
smoking  ban  to  all  indoor  public  areas  and  certain  open-air  areas  as  from  July  2009. 
Administrative  capacity  has  been 
introducing  a  clearer  division  of 
improved,  by 
responsibilities  between  the  Ministry  of  Health  and  the  Tobacco  and  Alcohol  Market 
Regulatory  Authority.  Tobacco  control  units  have  been  established  at  provincial  level  to 
improve  enforcement  of  the  smoking  ban.  However,  legal  alignment  with  tobacco  product 

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regulation  acquis,  especially  as  regards  high  tar  yields  and  oral  tobacco  still  remain  to  be 
done. Preparations in this field are well on track. 

In  the  field  of  communicable  diseases,  Turkey  has  made  good  progress.  A  strategic  plan 
(2008-2012)  has  set  clear  milestones  for  completion  of  alignment,  enforcement  and  the 
necessary changes to the institutional framework. The Ministry of Health has strengthened the 
institutional  capacity  for  investigation  and  management  of  possible  epidemics.  A  needs 
analysis  was  carried  out  to  identify  the  resources  required  for  epidemiological  surveillance. 
This  is  a  key  element  next  to  the  early  warning  and  response  system  (EWRS)  for  the 
accession negotiations on this chapter. Throughout the country over 7 000 medical staff have 
been trained. However, notwithstanding the increasing numbers of reported HIV cases, HIV 
prevention  policies  are  not  seen  as  a  priority  by  the  Government.  Access  to  information  on 
HIV/AIDS is very limited. Preparations in this area are well on track. 

As regards blood and blood components, Turkey has made progress. A strategic review of the 
blood transfusion system is underway. These are key elements for the accession negotiations 
on  this  chapter.  Concerning  tissue  and  cells,  legal  alignment  remains  outstanding. 
Administrative capacity is not sufficiently developed but the establishment of a National Cell 
Coordination Center in July 2008 is a right step to overcome this shortcoming. Preparations in 
these fields have started. 

No progress can be reported on mental health. Community-based services are not sufficiently 
developed  as  an  alternative  to  institutionalisation,  and  resources  continue  to  be  limited  in 
relation to the needs. A problem of insufficient general medical care and treatment persists in 
mental  health  hospitals  and  rehabilitation  centres  for  people  with  mental  disabilities. 
Preparations in this area are at an early stage. 

Some progress can be reported in the area of socio-economic determinants of health. In 2008, 
half  of  the  population  will  be  provided  with  family  medicine  and  primary  level  healthcare 
services.  Progress  can  be  reported  in  the  area  of  cancer  control  programmes.  However,  the 
implementation  of  the  Council  recommendation  on  cancer  screening  that  recommends 
population-based, organised screening for breast, cervical, and colorectal cancer has not been 
achieved yet. Preparations in these fields have started. 

Conclusion 

Overall,  further  progress  has  been  made  on  consumer  and  health  protection.  A  satisfactory 
level of legal alignment has been reached. However, in the area of consumer protection, more 
efforts remains necessary, in particular in the field of non-safety related issues and to ensure 
due  enforcement  of  consumer  protection  in  general.  Preparations  for  completing  legal 
alignment in the areas of blood and blood components, tissues and cells are underway.  

4.29.  Chapter 29: Customs union 

Turkey  has  made  further  progress  with  customs  legislation.  The  Under-secretariat  of 
Customs adopted a communiqué on the rules and procedures for implementation of binding 
tariff information (BTI). The communiqué designated the regional customs directorates in six 
cities, which have customs laboratories, to issue BTIs upon request by traders. Implementing 
legislation  on  temporary  importation  of  road  vehicles  has  been  published  but  the  ongoing 
practice  is  not  fully  in  line  with  the  acquis.  There  has  been  no  progress  on  the  duty  relief 
legislation, which is partly not in line with Turkey’s Customs Union obligations. Abolition of 

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duty relief for goods covered by the Customs Union and sold in duty-free shops to travellers 
entering Turkey is a key component of the accession negotiations on this chapter.  

Legislation  on  free-trade  zones  remains  not  in  line  with  the  acquis,  as  the  zones  are 
considered as areas outside the Turkish customs territory.  

Good  progress  has  been  made  by  the  Under-secretariat  of  Customs  to  strengthen  its 
administrative  and  operational  capacity.  Five  vehicle-  and  container-  scanning  systems 
were deployed at Gurbulak customs office and the ports of Istanbul Ambarli, Izmir, Alsancak, 
Mersin  and  Samsun.  The  Under-secretariat  of  Customs  signed  a  protocol  with  the  Energy 
Market Regulatory Authority with a view to exchanging information on activities to combat 
smuggling  of  fuel  products.  The  Under-secretariat  of  Customs  adopted  its  risk  management 
strategy.  However,  an  integrated  IT-based  risk  management  system  has  not  yet  been 
implemented  in  all  customs  offices.  An  overall  IT  strategy  of  the  Under-secretariat  of 
Customs has not been adopted. Activities on IT interconnectivity with the EU systems in the 
fields of transit (NCTS) and tariffs (TARIC, quota and surveillance) are underway. 

The  rate  of  import  and  export  declarations  that  were  processed  electronically  into  the 
electronic data interchange system (EDIS) increased. At present, Turkish customs procedures 
are integrated into the system and virtually all declarations are processed electronically.  

Further efforts were made to improve training. Intensive in-service training was provided on 
origin  matters,  outward  processing  and  sniffer  dogs.  Enforcement  of  intellectual  property 
rights  (IPR)  by  the  Under-secretariat  of  Customs  is  a  cause  for  concern  and  needs  to  be 
improved  substantially.  The  level  of  coordination  between  the  Under-secretariat  and  other 
relevant  IPR  public  authorities,  including  the  Turkish  national  police,  is  low.  The 
modernisation efforts need to be increased. 

“Customs Union” is one of the eight chapters covered by the conclusions on Turkey adopted 
by the Council (General Affairs and External Relations) on 11 December 2006 and endorsed 
by the European Council on 14/15 December 2006. As long as restrictions remain in place on 
the free movement of goods carried by vessels and aircraft registered in Cyprus or where the 
last port of call was Cyprus, Turkey will not be in a position fully to implement the acquis 
relating to this chapter. 

Conclusion 

Overall,  some  progress  has  been  made  in  this  chapter  both  as  regards  legislative  alignment 
and  administrative  capacity.  Turkey's  customs  legislation  is  highly  aligned  with  the  EU 
acquis,  thanks  to  the  Customs  Union.  Turkey  needs  to  make  further  efforts  to  align  its 
legislation  and  practices  on  duty-free  shops,  free-trade  zones,  customs  duty  relief,  transit, 
fight  against  counterfeit  goods  and  post-clearance.  Additional  efforts  are  needed  to  fight 
against counterfeit goods. 

4.30.  Chapter 30: External relations 

Turkey has made limited progress regarding the common commercial policy. 

The level of alignment with the EC common commercial policy is high. Some longstanding 
infringements of the Customs Union remain unresolved and are continuing to distort bilateral 
trade relations. There has been no further progress on alignment of the Turkish general system 

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of preferences (GSP). The non-harmonised areas of the Turkish general system of preferences 
(GSP) remain unchanged, particularly its geographical and product coverage. 

Extensive use of safeguard measures has a negative effect on EU commercial policy, as they 
affect  EU  exporters.  In  2008,  Turkey  imposed  two  more  safeguard  measures  on  the 
importation of spectacles and handbags. In addition, it initiated two safeguard proceedings on 
electrical  appliances  and  cotton  yarns,  the  latter  being  the  fourteenth  proceeding  opened  by 
Turkey since 2004.  

The level of coordination between Turkey and the EU within the World Trade Organisation, 
in  particular  as  regards  the  Doha  Development  Agenda  and  the  OECD,  has  improved. 
However, there is room for further improvements in this area.  

No  progress  can  be  reported  on  medium-  and  long-term  export  credits  to  companies.  There 
has  been  some  progress  on  dual-use  goods.  Turkey  amended  rules  for  export-licensing  of 
nuclear and nuclear dual-use goods and inter alia introduced catch-all controls through their 
Article 6. 

Concerning  bilateral  agreements  with  third  countries,  Turkey  granted  unilateral 
preferential  treatment  to  Kosovo.  The  Free  Trade  Agreement  with  Albania  was  ratified  by 
Parliament and has entered into force. Turkey has maintained a satisfactory level of alignment 
with the EC’s bilateral agreements. 

In  the  field  of  development  policy  and  humanitarian  aid,  some  progress  has  been  made. 
Turkey granted some 602 million USD of official development aid in 2007. Turkey’s level of 
alignment remains satisfactory in this field. 

“External  Relations”  is  one  of  the  eight  chapters  covered  by  the  conclusions  on  Turkey 
adopted by the Council (General Affairs and External Relations) on 11 December 2006 and 
endorsed by the European Council on 14/15 December 2006. As long as restrictions remain in 
place on the free movement of goods carried by vessels and aircraft registered in Cyprus or 
where the last port of call was Cyprus, Turkey will not be in a position fully to implement the 
acquis relating to this chapter. 

Conclusion 

Turkey has achieved a high level of alignment in this area, but it is not complete, in particular 
in  the  WTO  and  OECD  fora.  The  disproportionate  use  of  safeguard  measures  and 
longstanding trade irritants has an impact on proper functioning of the Customs Union. 

4.31.  Chapter 31: Foreign, security and defence policy 

The  regular  political  dialogue  between  the  EU  and  Turkey  has  continued  to  cover 
international  issues  of  common  interest,  including  Iraq,  Iran,  the  South  Caucasus  and  the 
Middle  East  peace  process.  (Concerning  neighbourly  relations  with  other  enlargement 
countries and member states, see Political criteria). 

Turkey continued to support efforts to achieve stability, security and national reconciliation in 
Iraq. Turkey has been active in the "Iraq neighbour process" and hosted the November 2007 
ministerial meeting in Istanbul. Cross-border terrorist activities of the PKK, listed on the EU 
list  of  terrorist  organisations,  pose  a  security  challenge  to  Turkey.  In  this  context,  Turkey 
started  air  strikes  in  December  2007,  and  in  February  2008  undertook  a  nine-day  ground 

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operation  in  Northern  Iraq.  In  parallel,  Turkey  intensified  diplomatic  exchanges  with  Iraqi 
authorities  and,  for  the  first  time,  engaged  in  official  contacts  with  the  Kurdish  regional 
government. A Turkish delegation met in October with the President and the Prime Minister 
of the Kurdish Regional Government. In March the President of Iraq paid an official visit to 
Turkey. In July Turkey and Iraq signed an agreement on the establishment of a High Council 
for Strategic Relations. 

As  regards  Iran,  Turkey  supports  the  EU  position  on  Iran’s  nuclear  programme  and 
encouraged  Iran  to  engage  in  a  diplomatic  solution  of  the  crisis  in  line  with  the  June  2008 
offer of the E3+3. Turkey has engaged in negotiations with Iran on a comprehensive energy 
agreement.  In  August,  the  two  countries  signed  a  co-operation  agreement  to  fight  against 
terrorism, drug trafficking and organized crime. The President of Iran paid a working visit to 
Istanbul in August. 

As  for  relations  with  the  Southern  Caucasus,  Turkey  maintains  close  relations  with 
Azerbaijan  and  Georgia.  Jointly  with  the  Presidents  of  Georgia  and  Azerbaijan,  Turkey 
inaugurated  the  construction  of  the  Baku-Alkhalkalaki-Kars  railway  in  November  2007.  As 
concerns relations with Armenia, while Turkey kept its land border with this country closed, 
Turkey's President paid the first ever visit of the kind to Erevan, raising hopes for a new start 
in bilateral relations. Official discussions also took place between the Armenian and Turkish 
Foreign Ministers. Turkey maintained its offer to establish a joint commission of historians. In 
reaction  to  the  August  Russo-Georgian  conflict,  Turkey  has  underlined  the  importance  of 
Georgian territorial integrity and sovereignty. At the same time, Turkey kept communication 
channels  with  Russia  open.  Following  the  conflict,  Turkey  played  a  conciliatory  role  and 
proposed to set up a "Caucasus Co-operation and Stability Platform" in which all countries of 
the  region  would  be  represented.  Furthermore,  Turkey  has  started  efforts  to  facilitate  the 
solution  of  the  conflict  in  Nagorno-Karabakh.  A  first  ever  trilateral  meeting  took  place 
between the Foreign Ministers of Turkey, Azerbaijan and Armenia in September. 

Turkey has been playing an active and constructive role in the Middle East. In line with the 
EU  position,  Turkey  continued  to  support  the  Middle  East  peace  process,  including  the 
Annapolis  process.  Turkey  expressed  support  for  Palestinian  unity  and  reconciliation.  In 
November  2007,  the  Presidents  of  Israel  and  of  the  Palestinian  Authority  made  speeches 
before the Turkish Parliament. Turkey brokered indirect talks between Syria and Israel with a 
view to preparing a peace agreement between the two countries. In May and in June 2008 two 
rounds  of  indirect  talks  took  place  in  Istanbul.  Turkey  made  efforts  to  contribute  to  the 
national  reconciliation  process  in  Lebanon,  and  welcomed  the  Doha  Agreement  under  the 
auspices of the Arab League.  

Turkey  welcomed  the  Commission's  2007  Communication  on  the  Black  Sea  Synergy  and 
wishes  to  see  a  more  active  role  of  the  EU  in  Black  Sea  regional  cooperation.  The  Turkish 
Foreign  Minister  participated  in  the  14  February  2008  Meeting  in  Kyiv  of  the  Foreign 
Ministers  of  the  countries  of  the  EU  and  of  the  wider  Black  Sea  Area.  In  November  2007, 
Turkey handed over the rotating chairmanship of the BSEC organisation to Ukraine.  

Turkey  continued  with  efforts  to  bring  together  Afghanistan  and  Pakistan.  The  Turkish 
Foreign  Ministry  continued  efforts  to  develop  the  April  2007  "Ankara  Declaration",  which 
provides both countries with a trilateral platform to discuss their problems. On the occasion of 
the International Conference in support to Afghanistan in June 2008 Turkey pledged to double 
its contribution for reconstruction. Furthermore, Turkey remains engaged with 800  troops it 
contributes  to  ISAF,  and  contributes  to  civil  and  military  capacity  building.  Turkey  has 

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intensified its relations with the Gulf States, particularly Qatar. A decision has been taken to 
open 10 new embassies in Africa.  

Turkey’s  broad  alignment  with  common  foreign  and  security  policy  (CFSP)  statements, 
declarations,  and  demarches  continued.  In  2008,  Turkey  aligned  itself  with  109  out  of  124 
CFSP declarations. Turkey did not follow the EU position expressed in statements concerning 
Iran (one case on freedom of expression), Russia, Pakistan, Sri Lanka, China, Sudan, Belarus 
and Mauritania.  

No particular developments can be reported as regards restrictive measures. 

As  regards  non-proliferation  of  weapons  of  mass  destruction,  Turkey  is  party  to  all  the 
existing  international  arrangements.  In  December  2007,  parliament  adopted  secondary 
legislation to implement the UN Chemical Weapons Convention. 

Turkey has not aligned with the EU position on membership of certain suppliers' groups, such 
as  the  Wassenaar  Arrangement  on  Export  Controls  for  Conventional  Arms  and  Dual-Use 
Goods and Technologies. (For dual-use goods, see chapter 30 – External relations). 

With  regard  to  cooperation  with  international  organisations,  Turkey  made  no  progress 
towards signing the Statute of the International Criminal Court. Turkey will be holding a non-
permanent seat in the UN Security Council during the term 2009-2010. 

There have been no particular developments with regard to security measures.  

Within  the  framework  of  the  European  security  and  defence  policy  (ESDP),  Turkey 
continues  to  contribute  to  the  EU-led  military  mission  EUFOR/ALTHEA  in  Bosnia  and 
Herzegovina.  Turkey  is  also  supporting  the  EU-led  police  missions  EUPM  in  Bosnia-
Herzegovina. Turkey is one of five non-EU countries contributing to the EULEX mission in 
Kosovo. Turkey wishes to enhance cooperation on ESDP, while stressing its discontent with 
its  status  within  ESDP,  with  the  stalemate  over  the  conclusion  of  a  bilateral  security 
agreement  with  the  EU,  as  well  as  over  the  administrative  arrangements  with  the  European 
Defence Agency.  

However,  concerning  EU-NATO  relations  beyond  the  “Berlin  Plus”  arrangements,  Turkey 
continues to object to EU-NATO co-operation which would involve all EU Member States. 
This created problems for EU-NATO co-operation in the context of civilian ESDP missions, 
in particular in Kosovo and Afghanistan. 

Conclusion 

Turkey’s alignment with the EU’s common foreign and security policy continued. Turkey has 
enhanced its positive role of regional stabilisation, in particular as regards the Caucasus and 
the Middle East. Turkey supports the EU efforts to ensure stability in Iraq and has maintained 
close  diplomatic  relations  with  this  country,  including  contacts  with  the  Kurdish  regional 
government.  

Turkey  is  contributing  substantially  to  ESDP  and  seeking  greater  involvement  in  ESDP 
activities. However, Turkey objects to EU-NATO co-operation which would involve all EU 
Member  States.  Turkey  has  not  aligned  with  the  EU  position  on  membership  of  the 
Wassenaar Arrangement. 

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4.32.  Chapter 32: Financial control 

Progress  has  been  made  in  the  area  of  Public  Internal  Financial  Control  (PIFC).  The 
Internal Audit Coordination Board of the Ministry of Finance has approved the Turkish public 
internal  audit  strategy  for  2008-2010  in  November  2007.  In  July  2008,  the  Ministry  of 
Finance  has  adopted  amendments  to  the  Public  Financial  Management  and  Control  Law 
(PFMCL)  relating  to  accounting  and  drafted  amendments  to  further  align  public  internal 
control  with  best  practices.  A  number  of  pieces  of  secondary  legislation  and  tertiary 
regulations were approved in the course of 2008, inter alia the internal control standards and 
the  internal  audit  manual.  Over  500  internal  auditors  have  been  trained  and  certified  in 
accordance  with  the  Public  Financial  Management  and  Control  (PFMC)  Law,  while  nearly 
500 financial officers have been employed in budget spending centres. A first annual report 
on the status of PIFC (for 2007) was presented to the Court of Accounts. 

As a result of full enactment of the PFMC Law, the 2002 PIFC policy paper and the related 
action plan should be updated. The PIFC strategy will have to focus on separation of the roles 
and  responsibilities  of  internal  audit  and  inspection  boards,  including  description  of  the 
comprehensive control environment in the public sector to clarify the delineation of control, 
audit and inspection functions, the need to harmonise internal audit of the national budget and 
of EU financial assistance, the precise definition of ex-ante financial control, establishment of 
an  operational  central  harmonisation  unit  (CHU)  for  internal  audit  and  of  the  decentralised 
internal  audit  units  and  a  CHU  for  FMC  relations  with  the  strategy  development  units.  The 
issue  of  the  location  of  the  CHU  has  to  be  decided  as  soon  as  possible  to  ensure  that  the 
modern  public  internal  audit  profession  can  develop  under  optimum  and  non-political 
conditions. 

The internal audit function has become operational in some government institutions following 
the  appointment  of  internal  auditors  and  the  publication  of  public  internal  audit  standards. 
Establishment of the strategy development units and their recruitment process are continuing. 
The  internal  audit  coordination  board  issued  key  documents  on  internal  audit.  A  permanent 
central harmonisation unit for internal audit should be established. 

Preparations are fairly advanced in this area. 

Some progress can be reported on external audit. The decision of the General Assembly of 
the Turkish Court of Accounts in July 2008 has taken important step by providing the Court 
of  Accounts  with  the  mandate  to  audit  all  but  confidential  expenditures  of  the  Defence 
Industry Support Fund. The revised Law on the Turkish Court of Accounts has not yet been 
enacted,  despite  appearing  on  the  government’s  priority  list.  This  delay  in  adoption  of  the 
revised  law  is  having  a  serious  impact,  especially  on  the  external  audit  of  local 
administrations. 

Preparations are moderately advanced in this area. 

There has been some progress on protection of the EU’s financial interests. In August the 
Prime  Ministerial  Inspection  Board  (PMIB)  was  confirmed  as  the  Anti-Fraud  Cooperation 
Structure (AFCOS) contact point and as such continues to cooperate with OLAF. Its required 
operational  independence  for  all  legislative,  administrative  and  operational  aspects  of 
protection of the Communities’ financial interests has yet to be developed but is envisaged by 
the end of 2008. 

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There  have  been  some  developments  with  regard  to  the  protection  of  the  European 
Communities'  financial  interests  (PIF  Convention).  The  new  Turkish  penal  code  satisfies 
many  of  the  requirements  of  the  PIF  Convention.  However  monitoring  by  the  Turkish 
authorities of the actual application of the Convention is required. 

Preparations are moderately advanced in this area. 

Little progress can be reported on protection of the euro against counterfeiting. The 2007 
amendment  to  the  Law  on  the  Turkish  lira  envisages  removal  of  “new”  from  “new  Turkish 
lira” with effect from 1 January 2009. As part of the reminting exercise, Turkey is expected to 
redesign Turkish coins to eliminate any similarities with euro coins. The Turkish authorities 
have the expertise required for analysis and classification of counterfeit notes and coins. The 
administrative  capacity  of  the  four  enforcement  bodies  is  sufficient.  The  counterfeit 
monitoring system is in operation under the auspices of the Turkish Central Bank. There are 
institutions serving de facto as the national analysis centre, national coin analysis centre and 
national  central  office.  These  structures  need  to  be  officially  appointed  to  ensure 
institutionalisation  and  sustainable  cooperation  with  the  EU  institutions.  The  Turkish 
legislation does not envisage any sanctions against credit institutions which fail to withdraw 
counterfeits from circulation and against medals and tokens similar to euro coins. 

Preparations are moderately advanced in this area. 

Conclusion 

Moderate progress can be reported in the area of financial control. Legislation implementing 
the PFMC Law is in place, but a number of amendments relating to internal control need to be 
approved.  Internal  auditors  have  started  to  take  up  office.  Institutionalisation  of  the  newly 
established  administrative  structures  is  continuing.  Further  efforts  are  needed  to  ensure  full 
implementation  of  the  PFMC  Law.  For  this  purpose,  Turkey  will  need  to  update  its  2002 
PIFC policy paper and adopt the revised law of the Turkish Court of Accounts. 

Permanent  structures  are  needed  for  cooperation  with  the  European  Anti-Fraud  Office  on 
protection of the EU’s financial interests and for contacts with the Commission departments 
responsible for protection of the euro against counterfeiting. 

Overall, Turkey’s level of alignment with the acquis in this chapter is moderately advanced. 

4.33.  Chapter 33: Financial and budgetary provisions 

There remain no significant divergences with the EU system concerning the basic principles 
and  institutions  in  the  underlying  policy  areas  linked  to  the  application  of  the  EU  own 
resources  system.  Efforts  to  align  with  the  relevant  acquis  chapters  (customs,  taxation, 
statistics and financial control) have continued. In 2008, Turkstat submitted to Eurostat GDP 
estimates compiled in accordance with the European system of accounts (ESA95) However, 
further  progress  is  needed  towards  full  implementation  of  the  ESA95  standards  to  ensure 
appropriate measurement of the resource based on gross national income. 

Although the own resources acquis does not require transposition, it is important to establish 
coordination  structures  and  implementing  rules  to  ensure  the  correct  calculation,  collection, 
payment and control of own resources and reporting to the EU for implementation of the own 
resources rules. Stronger administrative capacity is also needed in the relevant policy areas, in 
particular agriculture, customs, taxation, statistics and financial control. This includes setting 

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up effective instruments to combat customs duty and VAT fraud so that the financial interests 
of the EU can be protected. 

Conclusion 

The  acquis  in  this  area  is  directly  applicable  upon  membership  and  does  not  require 
transposition.  Sound  coordination  structures  and  implementing  rules  will  need  to  be 
established in due course. Preparations in the area of financial and budgetary provisions are at 
an early stage. 

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STATISTICAL ANNEX 

STATISTICAL DATA (as of 29 September 2008) 
Turkey 

Basic data 
Population (thousand) 
Total area of the country (km²) 

National accounts 
Gross domestic product (GDP) (million national currency) 
GDP (million euro) 
GDP (euro per capita) 
GDP (in Purchasing Power Standards (PPS) per capita) 
SI: GDP (in PPS per capita, EU-25=100) 
SI: Growth rate of GDP (national currency, at constant prices, % change on previous year) 
SI: Employment growth (national accounts, % change on previous year) 
Labour productivity growth: GDP growth per person employed (% change on previous year) 
SI: Unit labour cost growth (national accounts, % change on previous year) 
SI: Labour productivity (GDP in PPS per person employed, EU-25=100) 
Gross value added by main sectors (%) 

Agriculture 
Industry 
Construction 
Services 

Final consumption expenditure, as a share of GDP (%) 
Households and NPISH, as a share of GDP (%) 
General government, as a share of GDP (%) 
Gross fixed capital formation, as a share of GDP (%) 
Changes in inventories, as a share of GDP (%) 
Exports of goods and services, relative to GDP (%) 
Imports of goods and services, relative to GDP (%) 

Industry 
Industrial production volume index (2000=100) 

Inflation rate 
SI: Consumer price index (CPI), (total, % change on previous year) 

Balance of payments 
Balance of payments: current account total (million euro) 
Balance of payments current account: trade balance (million euro) 
Balance of payments current account: exports of goods (million euro) 

Note
1) 
2) 

Note

Note

Note

Note

1999 

2006 
1998 
2005 
64 642  65 787  66 889  67 896  68 838  69 770  70 692  71 610 
72 520 
783 562 783 562  783 562 783 562 783 562 783 562 783 562 783 562 783 562

2001 

2002 

2003 

2004 

2000 

2000 

1999 

1998 
2006 
2002 
70 203  104 596  166 658 240 224 350 476 454 781 559 033 648 932 758 391
242 787 233 424  289 446 219 816 243 570 269 322 314 304 387 655 419 013
5 778 
3 538 

3 548 

3 860 

3 238 

4 446 

3 756 

4 327 

5 413 

2003 

2001 

2004 

2005 

2007 
69 689b 
783 562 

2007 
856 387 
480 281 
6 892b 

7200.0e 7 000.0  7 600.0 7 000.0 7 000.0 7 000.0 8 100.0 8 800.0 9 700.0e 10 300.0be 

42.7e 
: 
: 
: 
: 
53.2e 

12.9 
27.7 
6.0 
53.4 
76.7 
66.5 
10.3 
22.9 
-0.7 
21.3 
20.2 

1998 
: 

1998 
84.6 

39.2 
-3.4 
: 
: 
: 
49.0 

10.7 
25.4 
5.6 
58.3 
80.7 
68.5 
12.2 
18.9 
0.2 
19.4 
19.3 

1999 
: 

1999 
64.9 

40.0 
6.8 
: 
: 
: 
53.3e 

10.8 
24.6 
5.4 
59.2 
82.2 
70.5 
11.7 
20.4 
0.4 
20.1 
23.1 

2000 
100.0 

2000 
54.9 

35.6 
-5.7 
: 
: 
: 
49.1e 

9.4 
23.8 
4.7 
62.1 
80.8 
68.4 
12.4 
15.9 
-0.9 
27.4 
23.3 

2001 
91.3 

2001 
54.4 

34.4 
6.2 
: 
: 
: 
49.1e 

11.4 
23.2 
4.6 
60.8 
80.8 
68.0 
12.7 
16.7 
0.9 
25.2 
23.6 

2002 
99.9 

2002 
45.0 

34.1 
5.3 
: 
: 
: 
49.8e 

11.1 
23.5 
4.5 
60.8 
83.5 
71.2 
12.2 
17.0 
0.6 
23.0 
24.0 

37.5 
9.4 
: 
: 
: 
54.0e 

10.7 
23.0 
5.0 
61.3 
83.2 
71.3 
11.9 
20.3 
-1.0 
23.6 
26.2 

39.2 
8.4 
: 
: 
: 
56.2e 

10.6 
23.0 
5.0 
61.3 
83.5 
71.7 
11.8 
21.0 
-1.0 
21.9 
25.4 

41.3e 
6.9 
: 
: 
: 
59.9e 

9.4 
22.9 
5.4 
62.4 
82.9 
70.5 
12.3 
22.3 
-0.2 
22.7 
27.6 

2003 
108.7 

2004 
119.3 

2005 
128.7 

2006 
136.3 

2003 
25.3 

2004 
10.6 

2005 
8.2 

2006 
9.6 

41.8e 
4.5 
: 
: 
: 
61.3e 

8.7 
22.2 
5.6 
63.5 
83.5 
70.8 
12.6 
21.6 
0.1 
22.0 
27.1 

2007 
143.6 

2007 
8.8 

2005 
2003 
1998 
-6 643 
-11 601 -17 794
1 784 
-12 522
-11 925 -18 278 -26 516
27 421  27 239  33 375  38 777  43 062  46 317  55 097  62 989 

2000 
-10 741
-23 882

1999 
-868 
-9 168 

2001 
4 198 
-3 755 

2002 
-662 
-6 758 

2004 

2006 
-25 401 
-32 607 
74 555 

2007 
-27 547 
-34 079 
84 135 

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Balance of payments current account: imports of goods (million euro) 
Balance of payments current account: net services (million euro) 
Balance of payments current account: net income (million euro) 
Balance of payments current account: net current transfers (million euro) 

of which government transfers (million euro) 

Foreign Direct Investment (FDI) in the reporting economy (million euro) 

Public finance 
General government deficit/surplus, relative to GDP (%) 
SI: General government debt, relative to GDP (%) 

Financial indicators 
Gross foreign debt of the whole economy, relative to GDP (%) 
Gross foreign debt of the whole economy, relative to total exports (%) 
Money supply: M1 (banknotes, coins, overnight deposits, million euro) 
Money supply: M2 (M1 plus deposits with maturity up to two years, million euro) 
Money supply: M3 (M2 plus marketable instruments, million euro) 
Total credit by monetary financial institutions to residents (consolidated) (million euro) 
Interest rates: day-to-day money rate, per annum (%) 
Lending interest rate (one year), per annum (%) 
Deposit interest rate (one year), per annum (%) 
euro exchange rates: average of period - 1 euro = … national currency 
Effective exchange rate index (2000=100) 
Value of reserve assets (including gold) (million euro) 

External trade 
Trade balance: all goods, all partners (million euro) 
Value of exports: all goods, all partners (million euro) 
Value of imports: all goods, all partners (million euro) 
Terms of trade (export price index / import price index, % change to previous year) 
Share of exports to EU-27 countries in value of total exports (%) 
Share of imports from EU-27 countries in value of total imports (%) 

Demography 
Natural growth rate: natural change (births minus deaths) (per 1000 inhabitants) 
Net migration rate: immigrants minus emigrants (per 1000 inhabitants) 
Infant mortality rate: deaths of children under one year of age per 1000 live births 
Life expectancy at birth: male (years) 
Life expectancy at birth: female (years) 

Note

Note

3) 
4) 
5) 

6) 
7) 

Note

8) 

Note

39 942
12 058
-2 663 
4 910 
133 
838 

36 406 
7 039 
-3 319 
4 580 
330 
735 

57 256 
12 316 
-4 333 
5 158 
221 
1 063 

42 532 
10 201 
-5 583 
3 335 
224 
3 743 

49 819 
8 339 
-4 816 
2 573 
526 
1 198 

58 242 
9 292 
-4 912 
902 
257 
1 548 

73 375 
10 288 
-4 509 
898 
252 
2 239 

1998 
: 
: 

1999 
: 
: 

2000 
-10.9 
42.9 

2001 
-24.5 
77.6 

2002 
-10.2 
73.7 

2003 
-9.0 
67.3 

2004 
-4.5 
59.2 

89 505 
12 276 
-4 722 
1 169 
485 
8 063 

2005 
-0.6 
52.3 

1998 
35.6 
200.8e
7 000 
31 206
32 878
30 790
78.8 
79.5 
93.3 
0.293 
193.0e
17 751

1998 
: 
: 
: 
: 
: 
: 

1998 
16.0 
: 
36.5 
66.7 
71.3 

1999 
41.7 
259.4e 
8 635 
41 324 
42 950 
30 856 
79.8 
86.1 
85.5 
0.447 
121.4e 
24 253 

1999 
-13 387 
24 964 
38 351 
-1.4 
58.0 
55.4 
#ARG! 
1999 
15.4 
: 
33.9 
67.1 
71.8 

2000 
44.7 
255.1e 
12 205 
51 591 
54 207 
44 492 
56.0 
51.2 
38.2 
0.575 
100.0e 
25 331 

2001 
57.7 
240.9e 
8 965 
37 253 
38 973 
26 977 
95.5 
78.8 
62.2 
1.102 
46.8e 
22 660 

2002 
56.2 
243.2e 
9 291 
36 325 
38 041 
20 035 
49.6 
53.7 
53.9 
1.440 
40.1e 
26 949 

2003 
47.3 
217.5e 
13 188 
47 398 
50 488 
29 025 
36.1 
42.8 
40.3 
1.695 
40.4e 
28 134 

2005 
2004 
35.0 
41.2 
168.0e 
183.8e 
15 762 
38 978b 
59 415  150 152b
63 411  164 302b
83 772 
43 328 
15.1 
22.0 
23.8 
29.1 
19.9 
23.6 
1.677 
1.777 
43.6e 
39.3e 
44 277 
27 654 

2003 

2001 

2000 

2004 
2002 
-29 263 -11 194 -16 341 -18 620 -27 637
50 891 
38 137 
30 182 
78 528 
54 478 
59 444 
2.0 
-0.6 
-8.5 
57.9 
56.6 
56.4 
49.3 
49.8 
52.4 
-1431.9
-75.4 
514.8 
2004 
2002 
2000 
12.9 
13.5 
14.1 
: 
: 
: 
24.6 
26.7 
28.9 
68.8 
68.4 
68.1 
73.6 
73.2 
72.8 

41 516 
60 136 
-0.2 
58.3 
50.6 
-72.7 
2003 
13.2 
: 
25.6 
68.6 
73.4 

35 062 
46 256 
-2.3 
56.0 
47.9 
-73.4 
2001 
13.7 
: 
27.8 
68.2 
73.0 

2005 
-34 560 
58 849 
93 410 
-2.6 
56.4 
45.2 
-231.3 
2005 
12.6 
: 
23.6 
68.9 
73.8 

107 162  118 214 
10 112 
11 015 
-5 212 
-5 329 
1 632 
1 520 
590 
495 
16 202 
15 920 

2006 
-0.1 
46.1 

2007 
-1.2 
38.8 

2007 
2006 
37.5 
39.0 
: 
174.9e 
38 616 
44 644 
160 193  201 366 
171 832  215 308 
100 358  140 157 

15.8 
19.0 
21.5 
1.809 
39.1e 
48 116 

2006 
: 
: 
: 
-3.3 
: 
: 
25.5 
2006 
12.4 
: 
22.6 
69.1 
74.0 

17.3 
20.1 
22.3 
1.789e 
44.5e 
52 058 

2007 
: 
: 
: 
7.8 
: 
: 
-335.1 
2007 
: 
: 
21.7 
69.3 
74.2 

EN 

88 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Labour market 
Economic activity rate (15-64): share of population aged 15-64 that is economically active (%) 
SI: Employment rate (15-64): share of population aged 15-64 that is in employment (%) 

Note 

Share of male population aged 15-64 that is in employment (%) 
Share of female population aged 15-64 that is in employment (%) 

SI: Employment rate of older workers (55-64): share of population aged 55-64 that is in 
employment (%) 
Employment by main sectors (%) 

Agriculture 
Industry 
Construction 
Services 

SI: Unemployment rate: share of labour force that is unemployed (%) 

Share of male labour force that is unemployed (%) 
Share of female labour force that is unemployed (%) 

Unemployment rate of persons < 25 years: share of labour force aged <25 that is unemployed 
(%) 
SI: Long-term unemployment rate: share of labour force that is long-term unemployed (%) 

Social cohesion 
Average nominal monthly wages and salaries (national currency) 
Index of real wages and salaries (index of nominal wages and salaries divided by the CPI) 
(2000=100) 
SI: Early school-leavers: share of population aged 18-24 having not completed upper 
secondary education and not currently in education or training (%) 

Standard of living 
Number of passenger cars per 1000 population 
Number of subscriptions to cellular mobile telephone services per 1000 population 

Infrastructure 
Density of railway network (lines in operation, per 1000 km²) 
Length of motorways (thousand km) 

Innovation and research 
SI: Spending on human resources (public expenditure on education) relative to GDP (%) 
SI: Gross domestic expenditure on research & development, relative to GDP (%) 
SI: Percentage of households who have Internet access at home (%) 

Environment 
SI: Total greenhouse gases emissions, CO2 equivalent (tons, 1990=100) 
SI: Energy intensity of the economy (kg of oil equivalent per 1000 euro GDP 2004) 
SI: Share of renewable energy in electricity consumption (%) 
SI: Road freight transport as a share of total inland freight transport (modal split of freight 
transport) (%) 

EN 

1998 
55.3 
51.4 
74.3 
28.5 

1999 
55.2 
50.8 
72.7 
28.9 

2000 
52.4 
48.9 
71.7 
26.2 

2001 
52.3 
47.8 
69.3 
26.3 

2002 
52.3 
46.7 
66.9 
26.6 

2003 
51.1 
45.5 
65.9 
25.2 

2004 
51.5 
46.1 
67.9 
24.3 

2005 
51.3 
45.9 
68.2 
23.7 

2006 
51.1 
45.9 
68.0 
23.8 

2007 
51.0 
45.8 
67.9 
23.8 

41.1 

39.3 

36.4 

35.9 

35.3 

32.7 

33.1 

30.8 

30.1 

29.4 

41.5 
17.1 
6.1 
35.3 
6.9 
6.9 
6.8 

14.2 

2.7 

40.2 
17.2 
6.2 
36.5 
7.7 
7.7 
7.6 

15.0 

2.1 

36.0 
17.7 
6.3 
40.0 
6.5 
6.6 
6.3 

13.1 

1.3 

37.6 
17.5 
5.2 
39.7 
8.4 
8.7 
7.5 

16.2 

1.7 

34.9 
18.5 
4.5 
42.1 
10.3 
10.7 
9.4 

19.2 

2.9 

33.9 
18.2 
4.6 
43.4 
10.5 
10.7 
10.1 

20.5 

2.5 

34.0 
18.3 
4.7 
43.0 
10.3 
10.5 
9.7 

19.7 

4.0 

29.5 
19.4 
5.3 
45.8 
10.3 
10.3 
10.3 

19.3 

4.1 

27.3 
19.7 
5.7 
47.3 
9.9 
9.7 
10.3 

18.7 

3.5 

26.4 
19.8 
5.8 
48.0 
9.9 
9.8 
10.3 

19.6 

3.0 

Note 

1998 
: 

1999 
: 

2000 
: 

2001 
: 

2002 
372.1 

2003 
492.0 

2004 
529.4 

2005 
595.4 

2006 
: 

2007 
: 

: 

: 

1998 
59.4 
54.3 

1998 
11.0 
1.7 

1998 
3.3 
0.5 
: 

1998 
151.0 
273.6 
37.3 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

58.8 

57.3 

54.8 

53.0 

54.6 

51.3 

50.0 

47.8 

1999 
61.9 
116.8 

2000 
66.1 
225.2 

2001 
66.8 
269.5 

2002 
66.8 
338.8 

2003 
67.4 
399.7 

2004 
76.4b 
491.0 

2005 
80.6 
609.0 

2006 
84.7 
726.2 

2007 
91.7 
878.0 

1999 
11.1 
1.7 

1999 
3.1 
0.6 
: 

1999 
151.0 
278.2 
29.5 

2000 
11.1 
1.8 

2000 
3.5 
0.6 
: 

2000 
165.0 
283.8 
24.3 

2001 
11.1 
1.9 

2001 
3.7 
0.7 
: 

2001 
154.0 
277.6 
19.1 

2002 
11.0 
1.9 

2002 
3.6 
0.7 
: 

2002 
159.0 
275.9 
25.6 

2003 
11.1 
1.9 

2003 
3.7 
0.6 
: 

2003 
168.0 
275.7 
25.2 

2004 
11.1 
1.9 

2004 
4.1 
0.7 
7.0 

2004 
174.0 
260.2 
30.9 

2005 
11.1 
1.8 

2005 
: 
0.8 
8.0 

2005 
184.0 
249.7 
24.7 

2006 
11.1 
2.0 

2006 
: 
0.8 
: 

2006 
195.0 
273.3 
25.5 

2007 
11.1 
2.0 

2007 
: 
: 
18.9 

2007 
: 
277.7 
18.9 

94.8 

94.8 

94.3 

95.3 

95.5 

94.6 

94.4 

94.4e 

94.3 

: 

Note 
9) 

Note 

Note 

Note 

89 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
  
  
  
  
  
  
  
  
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Energy 
Primary production of all energy products (thousand TOE) 
Primary production of crude oil (thousand TOE) 
Primary production of hard coal and lignite (thousand TOE) 
Primary production of natural gas (thousand TOE) 

Net imports of all energy products (thousand TOE) 
Gross inland energy consumption (thousand TOE) 
Electricity generation (thousand GWh) 

Note 

2003 

2000 

2001 

1999 

2 937 

2 746 

2006 
2002 
1998 
29 108  27 526  26 715  25 065  24 627  23 857  24 193  23 612  26 580 
3 219 
2 284 
2 414 
13 943  13 282  13 293  12 876  11 826  11 010  10 599  10 484  13 087 
311 
43 410  43 347  50 873  46 070  51 002  56 655  58 574  61 986  73 256 
72 312  71 042  77 374  71 370  75 341  79 278  81 859  85 159  99 642 
176.3 
129.4 
111.0 

150.7 

162.0 

124.9 

140.6 

116.4 

122.7 

2 349 

2 245 

2 259 

2 508 

2004 

2005 

602 

465 

526 

257 

738 

839 

461 

566 

2007 
25 957p 
1 975p 
13 709p 
774p 
79 834p 
105 792p 
191.1p 

Note 

1998 

1999 

2000 

2001 

2002 

2003 

2004 

2005 

2006 

2007 

110.6 

94.7 

104.2 

93.3 

108.5 

98.0 

101.6 

106.9 

: 

: 

10) 

3 

3 

5 

39 344  39 180  38 757  40 967  41 196  40 645  41 210  41 223  40 496 
10 069  10 526  10 871 
9 803 
11 031  11 054  10 761  10 548 
2 
4 
37 492  38 030  35 693  33 994  31 954  32 203  31 811  31 822  32 260 
: 
33 060  28 749  32 108  29 426  30 686  30 658  33 957  36 231  34 365 
22 283  17 102  18 821  12 633  16 523  12 623  13 517  15 181  14 452 
21 151  22 083  22 357  21 930  23 698  24 018  23 215  24 320  24 017 

9 788 
7 

4 

3 

1 

: 

: 

: 

: 

: 

: 

: 

: 

39 503p 
11 037 
2 
31 749 
: 
29 645 
12 415 
25 670 

Agriculture 
Agricultural production volume index of goods and services (producer prices, previous 
year=100) 
Total utilised agricultural area (thousand hectare) 
Livestock: cattle (thousand heads, end of period) 
Livestock: pigs (thousand heads, end of period) 
Livestock: sheep and goats (thousand heads, end of period) 
Production and utilisation of milk on the farm (total whole milk, thousand tonnes) 
Crop production: cereals (including rice) (thousand tonnes, harvested production) 
Crop production: sugar beet (thousand tonnes, harvested production) 
Crop production: vegetables (thousand tonnes, harvested production) 
SI: Structural Indicator 
e: estimate 
f: forecast 
p: provisional 
b: break in serie 
1. 
2. 
3. 
4. 
5. 
6. 
7. 
8. 
9. 
10. 

Source: Eurostat. Break in serie in 2006. 
Including lakes. 
Before December 2005, M1 included currency in circulation and demand desposits (TRY). From December 2005 onwards, M1 includes currency in circulation and demand deposits (TRY, FX). 
Before December 2005, M2 included M1 and time deposits (TRY). From December 2005 onwards, M2 includes M1 and time deposits (TRY, FX). 
Before December 2005, M3 included M2 and official deposits (time/demand). From December 2005 onwards, M3 includes M2, fund received from repo transactions and money market funds (B type liquid funds). 
Averages of monthly data for lending to enterprises of more than one year. 
Averages of monthly data, up to one year or longer. 
Calculated on the basis of ISIC Rev.3, base year 2003 
From 2004 onwards, data source is the General Directorate of Public Security. 
Excluding the number of buffaloes. 

EN 

90 

EN