Report from the Commission to the European Parliament and the Council - First Report on the implementation of the provisions of Protocol No 3 to the 2003 Act of Accession on the Sovereign Base Areas of the United Kingdom of Great Britain and Northern Ireland in Cyprus
Date: 2010-04-19
Institutions: European Commission
Subjects: Cyprus, United Kingdom, border control, free movement of persons, report, territorial law

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EUROPEAN COMMISSION 

Brussels, 19.4.2010 
COM(2010)155 final 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

First Report on the implementation of the provisions of Protocol No 3 to the 2003 Act of 
Accession on the Sovereign Base Areas of the United Kingdom of Great Britain and 
Northern Ireland in Cyprus 

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REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

First Report on the implementation of the provisions of Protocol No 3 to the 2003 Act of 
Accession on the Sovereign Base Areas of the United Kingdom of Great Britain and 
Northern Ireland in Cyprus 

Introduction 

The  2003  Act  of  Accession1,  to  which  Protocol  No  3  on  the  Sovereign  Base  Areas  of  the 
United Kingdom of  Great  Britain  and Northern Ireland in Cyprus2 (hereafter: "Protocol") is 
annexed, entered into force on 1 May 2004.  

The  Protocol  determines  which  provisions  of  the  Treaty  establishing  the  European 
Community  and  related  EC  law  (now  European  Union  law)  apply  to  the  United  Kingdom 
Sovereign  Base  Areas  of  Akrotiri  and  Dhekelia  in  Cyprus  (hereafter:  SBAs)  and  makes 
special arrangements regarding the implementation of these provisions. 

The movement of persons, goods and services across the 'Green Line' between the areas of the 
Republic  of  Cyprus  in  which  the  Government  of  the  Republic  of  Cyprus  does  not  exercise 
effective  control  and  the  areas  in  which  it  does  and  the  Eastern  Sovereign  Base  Area 
respectively  on  the  basis  of  Council  Regulation  (EC)  No  866/2004  of  29  April  2004  on  a 
regime under Article 2 of Protocol 10 to the Act of Accession, is not covered in this report.3 4 

This Report covers the period 1 May 2004 - 30 April 2009. 

1. 

CUSTOMS, INDIRECT TAXATION AND THE COMMON COMMERCIAL POLICY 

The  SBAs  are  included  within  the  customs  territory  of  the  Union.5  For  this  purpose,  and 
pursuant to Article 2 of the Protocol, a number of customs and common commercial policy 
acts (as amended or substituted from time to time) and their implementing acts apply to the 
SBAs.6 The implementation of this part of the acquis by the SBA Administration, as well as 
related  cooperation  with  the  competent  authorities  of  the  Republic  of  Cyprus  is  assessed  as 
satisfactory. The Commission is not aware of any complaints. 

This assessment in principle is the same as regards the applicable Community acts concerning 
turnover  taxes,  excise  duties  and  other  forms  of  indirect  taxation.7  Nevertheless,  when  it 

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Act  concerning  the  conditions  of  accession  of  the  Czech  Republic,  the  Republic  of  Estonia,  the 
Republic  of  Cyprus,  the  Republic  of  Latvia,  the  Republic  of  Lithuania, the  Republic  of  Hungary,  the 
Republic of Malta, the Republic of Poland, the Republic of Slovenia and the Slovak Republic and the 
adjustments to the Treaties on which the European Union is founded, OJ L 236, 23.9.2003, p. 33. 
OJ L 236, 23.9.2003, p. 940. 
OJ L 161, 30.4.2004, p. 128. 
For  issues  concerning  the  implementation  of  the  Green  Line  Regulation  see  the  Annual  'Green  Line 
Reports' of the Commission to the Council (see e.g. COM(2009) 478 final, 14.9.2009). 
See Articles 2 (1) and 7 (1) of the Protocol. 
See for this list Part One of the Annex to the Protocol. 
See Article 2 (2) of the Protocol and Part Two of the Annex to the Protocol. 

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comes to the reliefs and exemptions from duties and taxes on supplies to the UK forces and 
associated personnel8 (as already granted by the Treaty of Establishment9 and maintained by 
the  Protocol),  the  Commission  has  identified  certain  risks.  These  risks  in  particular  concern 
the  VAT  exemption  granted  to  the  UK  forces  and  the  civilian  staff  accompanying  them: 
firstly the fact that some goods subject to VAT are not rationed leaves scope for abuse (this 
particularly concerns means of transport), and, secondly, the SBA Administration appears to 
interpret  this  exemption  too  broadly  in  the  sense  that  it  seems  to  be  also  extended  to 
dependants of such staff.10. The Commission will examine this issue in more detail and take 
the necessary steps as appropriate. 

2. 

COMMON AGRICULTURAL POLICY 

The Common Agricultural Policy (CAP) applies to the SBAs11. It is implemented smoothly. 

The  UK  has  fully  delegated  agricultural  matters  in  the  SBAs  to  the  Republic  of  Cyprus.12 
(hereafter:  SBA 
Cooperation  between 
Administration) and the relevant Cypriot authorities works well. 

the  Sovereign  Base  Area  Administration 

The competent authority of the Republic of Cyprus implemented the following CAP schemes 
for  beneficiaries  located  in  the  SBAs  during  the  reporting  period:  i)  Single  Area  Payment 
Scheme; ii) Rural Development measures from the 3 different axes and iii) Common Market 
Organisation  measures,  in  particular  for  the  wine  sector.  A  number  of  applications  for  the 
different  schemes  have  been  lodged  to  the  Cyprus  Agricultural  Payments  Organisation,  on-
the-spot controls have been performed and payments have been effectively granted. 

No problems affecting the implementation of the CAP have been brought to the attention of 
the  Commission.  Desk  verification  on  available  information  (2008  on-the-spot  checklist) 
confirmed  that  claims  were  lodged  from  these  areas.  Furthermore,  the  administration 
(including  payment)  of  agricultural  subsidies  by  the  Republic  of  Cyprus,  in  particular  the 
internal  control  systems  of  the  Cypriot  paying  agency,  are  judged  as  adequate  by  the 
certification body. 

Only minor problems encountered in handling the applications and in executing on-the-spot 
controls  were  reported  by  the  Republic  of  Cyprus.  These  problems  concerned:  i)  the 
measurement of areas with the use of GPS devices in the vicinity of antennas installed by the 
SBA Administration (where it was difficult or impossible to obtain GPS connection); ii) the 
fact  that  the  SBA  Administration  provides  licenses  for  the  use  of  agricultural  areas  for  one 
year  only,  whereas  the  implementation  of  various  Rural  Development  measures  needs 
contracts of five years or more (e.g. in agri-environmental areas) – in these cases the relevant 
plots are approved as eligible for a subsidy but the applicant is required to submit each year 
the renewed document (issued by the SBA Administration); and iii) the reported risk13 that the 

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See Article 2 (3) of the Protocol and Part Three of the Annex to the Protocol. 
Treaty concerning the Establishment of the Republic of Cyprus, 16 August 1960. 
Such  an  interpretation  would  run  against  Article  151(1)(e)  of  the  VAT  Directive  (Council  Directive 
2006/112/EC of 28 November 2006, OJ L 347, 11.12.2006, p. 1). 
See Article 3 (a) of the Protocol. 
On the basis of SBA Agricultural Provisions Ordinance 2007, Ordinance 9 of 2007, Supplement No. 2 
to  'The  Sovereign  Base  Areas  Gazette  No  1454  of  20th  April  2007',  p.  83  (hereafter:  "Agricultural 
Provisions Ordinance 2007"). 
As reported to the Commission during an audit mission by one beneficiary located in the SBAs. 

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SBA  Administration  does  not  easily  grant  the  authorisation  for  the  construction  of  new 
buildings (thereby causing possible limitations under certain CAP schemes). 

3. 

VETERINARY AND PHYTOSANITARY ISSUES 

The implementation of the European Union veterinary and phytosanitary rules, referred to in 
Article 3 (b) of the Protocol, is delegated to the Republic of Cyprus.14 The SBA Agricultural 
Provisions  Ordinance  2007  incorporates  a  series  of  laws  of  the  Republic  of  Cyprus  that 
implement  measures  in  the  veterinary  and  phytosanitary  fields  which  have  as  their  direct 
objective  the  protection  of  public  health.  The  Republic  of  Cyprus  Government  notifies  the 
SBA Administration of any adoption or amendment of related legislation. In addition, there is 
a close cooperation in case of emergencies15 to coordinate measures to be taken for the control 
of  diseases.  Products  needing  a  phytosanitary  certificate  cannot  be  directly  introduced  from 
third countries into the SBAs but enter Cyprus through a port or airport in the government-
controlled areas of the Republic of Cyprus. Relevant inspections are therefore carried out by 
the inspectors of the competent Cypriot authority at the official points of entry of the Republic 
of Cyprus. Comparable procedures are in place when it comes to the introduction from third 
countries of animals and animal products which require a veterinary inspection. 

The  implementation  of  this  provision  of  the  Protocol  is  assessed  as  satisfactory.  No 
difficulties or practical problems occurred. No complaints have been brought to the attention 
of the Commission. 

4. 

SOCIAL SECURITY 

Article  4  of  the  Protocol  provides  that  persons  resident  or  employed  in  the  territory  of  the 
SBAs  who  are  subject  to  the  social  security  legislation  of  the  Republic  of  Cyprus  shall  be 
treated for the purposes of Council Regulation (EEC) No 1408/7116 as if they were resident or 
employed  in  the  territory  of  the  Republic  of  Cyprus17.  The  Protocol  therefore  grants  people 
working  in  the  SBAs18  in  practice  equal  treatment  with  those  working  in  the  Republic  of 
Cyprus when it comes to social security. 

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As a consequence, all consignments of potatoes from the northern part of Cyprus across the Green Line 
into  the  Eastern  Sovereign  Base  Area  are  inspected  by  phytosanitary  inspectors  of  the  Republic  of 
Cyprus. 
For instance in the case of outbreak of infectious animal diseases, such as Avian Influenza and Foot and 
Mouth Disease in 2006 and 2007. 
Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to 
employed  persons,  to  self-employed  persons  and  to  members  of  their  families  moving  within  the 
Community, OJ L 149, 5.7.1971, p. 2. 
As the SBAs are part of UK territory, people working there are considered to be working in the UK and 
consequently  would  be  subject  to  the  social  security  legislation  of  the  UK  (as  outlined  in  Council 
Regulation (EEC) No 1408/71). On the basis of the latter Regulation, these persons therefore would be 
treated  in  Cyprus  like  foreigners.  They  would,  for  instance,  only  benefit  from  health  care  in  Cyprus 
after prior authorisation from the UK health authorities if required. Article 4 of the Protocol addresses 
this problem. 
The military personnel and UK civil servants are not subject to the Cypriot social security legislation, 
but according to Articles 13 (2) (d) and 13 (2) (e) of Council Regulation (EEC) No 1408/71, to the UK 
Social Insurance legislation, and do not benefit from Article 4 of the protocol 

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In  order  to  facilitate  the  application  of  the  Cyprus  Social  Insurance  legislation,  the  SBA 
Administration  has  replicated  the  provisions  of  the  relevant  Cypriot  legislation.19  The  SBA 
Administration has also mirrored (in English) all forms used by the Republic of Cyprus Social 
Insurance  Services.  A  bilateral  agreement  provides  for  the  necessary  administrative 
arrangements.  Supervision  of  the  implementation  is  –  with  the  exception  of  employment  in 
military installations – generally delegated to the competent Republic of Cyprus authorities. 

The  implementation  of  this  provision  of  the  Protocol  is  effective.  No  complaints  have  been 
brought to the attention of the Commission. 

5. 

JUSTICE AND HOME AFFAIRS 

According to Article 5 of the Protocol, the Republic of Cyprus shall not be required to carry 
out checks on persons crossing their land and sea boundaries with the Sovereign Base Areas, 
but the UK shall exercise controls on persons crossing the external borders of the Sovereign 
Base Areas. 

These 'external borders of the Sovereign Base Areas' are defined as "their sea boundaries and 
their  airports  and  seaports,  but  not  their  land  or  sea  boundaries  with  the  Republic  of 
Cyprus".20 In other words, the SBA Administration has no obligation to exercise control on 
persons at the land boundaries with the Republic of Cyprus.21 

During  the  whole  reporting  period,  only  RAF  Akrotiri  and  a  3  mile  strip  of  the  coast  of 
Dhekelia  were  designated  as  'entry  points'.22  Though,  the  latter,  which  is  meant  to  be  used 
only  for  limited  purposes,  was  not  used  for  this  purpose  during  the  reporting  period.  Both 
entry points are restricted for use by military and civilian personnel connected with the British 
forces in Cyprus or the SBA Administration. 

The SBA Administration does not maintain any records of numbers or nationalities of persons 
crossing.  No  incidents  were  reported  to  the  Commission.  On  one  single  occasion  (Lebanon 
crisis in 2006), the SBA Administration derogated from the conditions for nationals of third 
countries to cross the external borders of the SBAs, as laid out in point 3 (a) of Part Four of 
the Annex to the Protocol23, on humanitarian grounds.24 On this occasion, a small number of 
non-EU nationals (less than 50) was airlifted from Lebanon to RAF Akrotiri in the first few 
days of the evacuation procedure.25 

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Social Insurance Ordinance of 1980, Gazette No. 569 of 2.10.1982. 
See point 1 of Part Four of the Annex to the Protocol. 
This though with the exception of the boundary between the Eastern Sovereign Base Area and the areas 
not under the effective control of the Government of the Republic of Cyprus (which is treated as part of 
the  external  borders  of  the  SBAs  for  the  duration  of  the  suspension  of  the  application  of  the  acquis 
under Protocol 10; see Article 2 (2) of Protocol 10 to the 2003 Act of Accession). 
Since  11  August  2009,  the  following  points  are  authorised  by  the  SBA  Administration  as  'crossing 
points' in accordance with point 1 (b) of Part Four of the Annex to the Protocol: RAF Akrotiri, Akrotiri 
Mole, Watson's Mole in Dhekelia and Kingsfield Airfield in Dhekelia. 
These are in particular the condition to possess a valid travel document and a valid visa for the Republic 
of Cyprus, if required. 
See point 3 (b) of Part Four of the Annex to the Protocol. 
According  to  the  information  from  the  SBA  Administration,  these  were  urgent  cases.  All  subsequent 
non-EU  arrivals  during  the  Lebanon  crisis  were  transported  to  Limassol  port  in  the  government-

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As  regards  the  surveillance  of  the  external  borders  of  the  SBAs,  the  SBA  Administration 
carries out regular maritime controls along the sea boundaries. With regard to asylum, based 
on  a  Memorandum  of  Understanding  between  the  two  countries,  the  responsibility  of 
examining the applications of asylum seekers who first entered the island of Cyprus through 
the SBAs is delegated to the Republic of Cyprus. The latter also examines the applications of 
all  those  asylum  seekers  who  entered  the  government-controlled  areas  of  the  Republic  of 
Cyprus via the Eastern Sovereign Base Area.26 No other related function has been delegated 
to the Republic of Cyprus. 

No irregularities have been encountered with regard to the implementation of the provisions 
of point 5 of and Part Four of the Annex to the Protocol. Checks on persons and surveillance 
of  the  external  borders  of  the  SBAs  carried  out  by  the  SBA  Administration  as  well  as 
cooperation with the Republic of Cyprus authorities is assessed as adequate. 

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6. 

OTHER AREAS OF EUROPEAN UNION LAW 

Beyond the precise scope of the Protocol, the SBA Administration has made provision for the 
unilateral application of directly applicable EU law.27 As a consequence, also other parts of 
the acquis indirectly apply in the SBAs. This Ordinance gives effect to the commitment of the 
SBA  Administration  that  the  "laws  applicable  to  the  Cypriot  population  of  the  British  base 
areas will be as far as possible the  same  as the laws of the  Republic."28 In complying with 
this  'mirroring'  commitment,  the  SBA  Administration  in  particular  adopted  the  Euro  as  its 
currency at the same time as the Republic of Cyprus (on 1 January 2008).29 

7. 

CONCLUSIONS 

Protocol  No  3  to  the  2003  Act  of  Accession  on  the  Sovereign  Base  Areas  of  the  United 
Kingdom of Great Britain and Northern Ireland in Cyprus entered into force on 1 May 2004. 
It  determines  which  provisions  of  the  European  Union  law  apply  to  the  United  Kingdom 
Sovereign  Base  Areas  of  Akrotiri  and  Dhekelia  in  Cyprus  and  makes  special  arrangements 
regarding the implementation of these provisions. 

With regard to customs, indirect taxation and common commercial policy, the implementation 
of this part of the acquis by the SBA Administration, as well as related cooperation with the 
competent  authorities  of  the  Republic  of  Cyprus  is  assessed  as  satisfactory.  Though,  risks 
have been identified in the context of reliefs and exemptions from duties and taxes on supplies 
to the UK forces and associated personnel. 

The  Common  Agricultural  Policy  is  implemented  smoothly  in  the  Sovereign  Base  Areas. 
Only minor problems encountered in handling the applications and in executing on-the-spot 
controls were reported by the Republic of Cyprus. 

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controlled  areas  of  the  Republic  of  Cyprus and underwent  immigration  controls  with  the  Republic  of 
Cyprus authorities. 
See point 7 (b) of Part Four of the Annex to the Protocol. 
See the 'European Community (Specified Measures) Ordinance 2005', Ordinance 24 of 2005. 
Section 3 (2) of the Agreement in the form of an exchange of notes, made on 16.8.1960, between the 
UK and the Republic of Cyprus on the administration of the UK Sovereign Base Areas ('Appendix O'). 
See the 'European Community (Specified Measures) (Medals and Tokens similar to Euro coins) Order 
2008', Public Instrument 37 of 2008, published in Gazette No. 1518 of 10.11.2008. 

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The implementation of the provision of the Protocol on phytosanitary and veterinary issues is 
assessed  as  satisfactory.  No  difficulties  or  practical  problems  appear  to  have  occurred.  No 
complaints have been brought to the attention of the Commission.  

As regards the provision on social security, its implementation is assessed as effective. Also 
no complaints have been brought to the attention of the Commission. 

No irregularities have been encountered with regard to the implementation of the provisions 
in the field of Justice and Home Affairs. Checks on persons and surveillance of the external 
borders  of  the  Sovereign  Base  Areas  carried  out  by  the  SBA  Administration  as  well  as 
cooperation with the Republic of Cyprus authorities are assessed as adequate. 

The overall conclusion is that Protocol 3 to the 2003 Act of Accession provides an effective 
way  of  applying  certain  provisions  of  European  Union  law  to  the  Sovereign  Base  Areas  of 
Akrotiri  and  Dhekelia  of  the  United  Kingdom  of  Great  Britain  and  Northern  Ireland  in 
Cyprus.  The  Commission  will  continue  to  monitor  the  implementation  of  the  Protocol,  in 
particular with regard to the risks identified. 

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