Turkey: International Trade Law Review

Last Updated: 2 October 2018
Article by Fevzi Toksoy, Ertuğrul Can Canbolat LL.M. and Hasan Güden

I OVERVIEW OF TRADE DEFENCE INSTRUMENTS

Turkey ranks among the World Trade Organization's (WTO's) top 10 users of anti-dumping measures. Between 1995 and 2014, Turkey was ranked 10th among WTO members in terms of the number of anti-dumping investigations initiated and 7th in terms of the number of anti-dumping measures imposed. The anti-dumping measures imposed by Turkey mostly concerned plastics and rubber, textiles, and base metals.2 Indeed, the total number of anti-dumping and anti-subsidy investigations that Turkey has initiated at the time of writing is 200.3

From the beginning of 2017 to the beginning of July 2018, Turkey has initiated 33 investigations in relation to trade remedies:

  1. 18 anti-dumping investigations (of which 11 are expiry review investigations);
  2. one anti-subsidy investigation;
  3. eight safeguard investigations; and
  4. six anti-circumvention investigations.

Anti-dumping, countervailing, and safeguard measures are reviewed by different departments within the Turkish Ministry of Trade (the Ministry).

As regards anti-dumping, countervailing, and anti-circumvention measures, the Directorate General for Imports of the Ministry of Trade (the Directorate General) is empowered to conduct a preliminary examination upon complaint or ex officio. If the Directorate General considers that there are reasons warranting the initiation of an investigation, it will issue a recommendation to the Board of Evaluation for Unfair Competition in Imports. The Board of Evaluation for Unfair Competition in Imports will then decide whether to authorise the Directorate General to conduct an investigation. If so, the Board of Evaluation for Unfair Competition in Imports publishes an initiation communique in the Official Gazette. As a result of its investigation, the Directorate General can make proposals to the Board as regards measures to be taken.

The Board of Evaluation for Unfair Competition in Imports is empowered to make proposals in the course of an investigation, to evaluate the results of investigations and to submit for the Ministry's approval draft decisions on the imposition of provisional or definitive measures. Eventually, the Board of Evaluation for Unfair Competition in Imports can also propose undertakings in the course of an investigation, decide whether or not to accept a proposed undertaking and take relevant measures where undertakings have been violated.

The Ministry is also competent to propose, apply and monitor safeguard measures. More precisely, the Department of Safeguards (within the Directorate General) is authorised to carry out safeguard investigations either on its own initiative or upon complaint. The Board for the Evaluation of Safeguard Measures for Imports decides, among other things, whether to initiate an investigation; to adopt, review, extend, modify or abolish any provisional or definitive safeguard measure; and to determine the form, extent and duration of such measures.

Eventually, the Directorate General for Imports may decide to conduct surveillance upon a written application or ex officio.

II LEGAL FRAMEWORK

Owing to the economic contraction and foreign exchange bottleneck of the 1970s, Turkey decided in 1980 to liberalise its economy and adopted an economic policy based on growth through exports. Indeed, from the 1960s until 1980, Turkey pursued an import-substitution industrialisation policy. To accomplish that shift, Turkey had to open its economy and gradually abandon its restricting policies (authorisation to import, foreign exchange control, etc.). The liberalisation of the Turkish economy has thus been accompanied by the suppression of barriers aiming to substitute imports with domestically-produced inputs.

While liberalising its economy and thus facilitating imports, Turkey felt the need to somehow protect its domestic producers. In that context, the first legislation providing for trade defence instruments was adopted in 1989. Since then, Turkey has been one of the developing countries that intensively used trade remedies (particularly anti-dumping measures) both to protect its domestic industries and to respond to measures taken by other states affecting Turkish exports.

In terms of liberalisation, Turkey went further by taking part in the European Union Customs Union in 1995, which meant adopting the EU's common external tariff and the compulsory alignment with the EU's Common Trade Policy.4

Turkey is also a member of the WTO and is therefore bound by WTO agreements. These include the General Agreement on Tariffs and Trade (GATT 1994) and the annexed agreements such as the Agreement on Subsidies and Countervailing Measures and the Agreement on Trade-Related Investment Measures that include provisions on investment incentives. In brief, these provide that Turkey cannot:

  1. discriminate between foreign and domestic companies while giving subsidies;
  2. give subsidies that directly promote exports; or
  3. give subsidies that are contingent upon the use of local content.

The GATT 1994 and the Agreement on Implementation of Article VI of GATT 19945 constitute the grounds in Turkish law for every legislation on trade remedies, and are directly applicable regarding all issues that are not addressed in the Turkish law.

Footnotes

1 M Fevzi Toksoy is a managing partner, Ertuğrul Canbolat is a senior associate and Hasan Güden is an associate at ACTECON.

2 World Trade Organization, Trade Policy Review, S/331/Rev. 1, p. 68.

3 The following breakdown may be made: 108 measures are in force; 41 measures have expired; 11 measures have been repealed as a result of expiry investigations; 27 investigations have ended without the adoption of any measures; and 13 investigations are still ongoing. Those numbers have been calculated by considering the number of initiation notices and not the number of subject countries.

4 The Customs Union Agreement came into force on 31 December1995.

5 Approved by Law No. 4067 dated 26 January 1995. Ratified by the Decision No. 95/6525 of the Council of Ministers dated 3 February1995.

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Originally published in Law Business Research Ltd

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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