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5- COMPANY LAW

Secondary Legislation promulgated after the publication of the Council Decision of 8 March 2001 on the Accession Partnership with the Republic of Turkey is given in Annex 5.1.

I- PRIORITY LIST

PRIORITY 5.1 Company Law
Task 5.1.1 Alignment with Company Law Legislation
Task 5.1.2 Accounting and Auditing
PRIORITY 5.2 Intellectual Property Rights
PRIORITY 5.3 Industrial Property Rights

II- MEASURES FOR HARMONISATION WITH THE EU LEGISLATION AND IMPLEMENTATION

PRIORITY 5.1 Company Law
1- Priority Description
The priority of Company Law comprises legislation concerning companies, and accounting and auditing. Alignment with company law legislation proceeds mainly within the scope of the draft Turkish Code of Commerce. In addition to these studies, the Capital Markets Board (CMB), and Turkish Accounting Standards Board (TASB) will make some arrangements in accordance with their responsibilities.
The CMB determines the accounting standards for publicly held joint stock companies and capital market institutions and regulates independent auditing standards of these companies and institutions. In 2001, two Communiqués on consolidated financial statements and accounting for investments in associates, and on financial statements in hyperinflationary periods were published by the CMB. According to these Communiqués, companies whose shares are traded on exchanges or on other organised markets, having subsidiaries and/or undertakings under the same management in terms of capital and management relations, are required to prepare consolidated financial statements as from the annual accounts drawn up after 1 January 2003 and the following quarterly accounts. Similarly, publicly held companies, intermediary institutions and investment companies and subsidiaries and associates of these three groups shall also prepare their financial statements according to the accounting provisions in hyperinflationary periods as from the annual accounts drawn up after 1 January 2003 and the following quarterly accounts. Before this time, it is optional for companies and capital market institutions listed above to prepare such financial statements. In 2002, the CMB also made amendments to independent auditing standards. With these amendments, the independence of autonomous auditing companies has been strengthened through separating independent auditing and consulting activities, requiring the establishment of audit committees for companies whose shares are traded on the exchanges, and compulsory rotation of independent auditing companies. Moreover, the institutional responsibility for preparation, presentation and accuracy of financial statements was regulated in detail.
In addition, the CMB has been working on two projects regarding International Accounting Standards (IAS) and independent auditing standards. The drafts which are compatible with IAS are released for consultation on the CMB web site. Since the EU IAS Regulation requires all companies listed on regulated markets to prepare their consolidated financial statements in accordance with IAS from 2005 onwards, accounting standards determined by CMB for companies listed on stock exchanges will be in line with the EU legislation before the planned period.
The Turkish Accounting Standards Board (TASB), established according to the Supplementary Article-1 of the Capital Market Law, and having administrative and financial autonomy, is responsible for the development and adoption of national accounting standards required for relevant, accurate, reliable, comparable, and comprehensive financial statements, and for the determination and publication of national accounting standards in the public interest. TASB, which became operational in March 2002, is still continuing to complete its organizational structure. TASB has already prepared 13 Draft Turkish Accounting Standards (TAS), and launched a consultation process. Upon completion of its organizational structure TASB will start to publish Turkish Accounting Standards that are fully harmonized with the IAS .


2- Schedule of Necessary Legislative Changes
Table 5.1.1

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
Task 5.1.1. Alignment with the Company Law Legislation
Turkish Code of Commerce Ministry of Justice 2004, II. Quarter 1- 2004, IV. Quarter
Communiqué Amending the Communiqué on Principles Regarding Registered Capital System
Capital Markets Board March 2005a) 2- March 2005



Table 5.1.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
Turkish Code of Commerce Ministry of Justice 2004, II. Quarter 1- 2004, IV. Quarter
Communiqué Amending the Communiqué on Principles Regarding Registered Capital System Capital Markets Board March 2005a) 2- March 2005
Law Amending Certain Provisions of Capital Market Law Capital Markets Board b) September 2005 c) 2- December 2005
Turkish Code of Commerce Ministry of Justice 2004, II. Quarter 1- 2004, IV. Quarter
Communiqué Amending the Communiqué on Principles Regarding Registration to the Board and Sale Of Shares Capital Markets Board March 2005 a) 2- March 2005
Law Amending Certain Provisions of Capital Market Law Capital Markets Board September 2005c) 2- December 2005
4 Eleventh Council Directive 89/666/EEC of 21 December 1989 concerning disclosure requirements in respect of branches opened in a Member State by certain types of company governed by the law of another State Turkish Code of Commerce Ministry of Justice 2004, II. Quarter 1- 2004, IV. Quarter



Table 5.1.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
5 Twelfth Council Company Law Directive 89/667/EEC of 21 December 1989 on single-member private limited-liability companies Turkish Code of Commerce Ministry of Justice 2004, II. Quarter 1- 2004, IV. Quarter
Turkish Code of Commerce Ministry of Justice 2004, II. Quarter 1- 2004, IV. Quarter
Communiqué Amending the Communiqué on Principles Regarding Registration to the Board and Sale Of Shares Capital Markets Board March 2005 a) 2- March 2005
Law Amending Certain Provisions of Capital Market Law Capital Markets Board September 2005 c) 2- December 2005
7 Council Regulation (EC) No 2157/2001 of 8 October 2001 on the Statute for a European company (SE) Ministry of Justice Will be determined during the negotiation process. Will be determined during the negotiation process.
Task 5.1.2. Accounting and Auditing
Communiqué Amending the Communiqué on Rules and Principles Regarding the Financial Statements and Reports in Capital Markets Capital Markets Board December 2005 2- December 2005 d)
Communiqué on Turkish Accounting Standards Turkish Accounting Standards Board December 2005 2- December 2005d)


Table 5.1.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
Communiqué on Rules and Procedures Regarding Consolidated Financial Statements and Accounting for Investments in Associates in Capital Markets Capital Markets Board December 2005 2- December 2005d)
Communiqué on Turkish Accounting Standards Turkish Accounting Standards Board December 2005 2- December 2005d)
Communiqué on Rules and Procedures Regarding Consolidated Financial Statements and Accounting for Investments in Associates in Capital Markets Capital Markets Board December 2005 2- December 2005 d)
Communiqué on Turkish Accounting Standards Turkish Accounting Standards Board December 2005 2- December 2005d)
a) Following the entry into force of the Turkish Code of Commerce, the Capital Markets Board will make arrangements parallel to the provisions of the Code regarding publicly held joint stock companies.
b) The Amendment to the Capital Market Law in 1999 allows for publicly held joint stock companies to distribute interim dividends. In 2001, the Capital Markets Board issued a Communiqué, which determines the interim payment principles, and these principles are in line with the principles of the 77/91/EEC Directive. With the amendment to the Communiqué on the Principles Regarding Registration to the Board and Sale of Shares it has become mandatory for the boards of publicly held joint stock companies with a share capital system to submit a written report to the general assembly indicating the reasons for restriction and justifying the proposed issue price, in case of a restriction of pre-emption rights. This amendment is in line with the 77/91/EEC Directive. In addition to these amendments, the Capital Markets Board will amend arrangements regarding the required quorum in the general assembly and registered capital system.
c) Amendments on Capital Market Law are related not only with company law but also with the other EU arrangements. Thus, the ratification date is determined by taking into account the fact that several amendments will be made to the Law with one draft, with a view to aligning with EU legislation
d) The European Commission has adopted the Directive amending the EU regulations on accounting, following its approval of the EU’s Council of Ministers. The changes, approved by the European Parliament in January 2003 (IP/03/47), bring existing EU regulations in line with current best practice. The regulation, which was published in June 2002(IP/02/417 and IP/01/200), requires all EU companies whose shares are traded on the exchanges or on the other organised markets to use IAS from 2005 onwards, and allows Member States to extend this requirement to all companies. These amendments also allow Member States, which do not require the application of IAS from all companies to use a similar high quality financial reporting system. Accordingly, the date for the alignment of Turkey’s arrangements regarding accounting and auditing with the EU regulations is set as December 2005, since the studies on accounting and auditing in the EU are envisaged to be completed by the end of year 2005.



3- Schedule of Necessary Institutional Changes
Table 5.1.2

No Necessary Institutional Changes Period of Implementation
Capital Markets Board
1 Training of staff on the implementation of EU regulations 2003-2006
2 Translation of legislation 2003-2006
Turkish Accounting Standards Board
1 Completing the institutionalization of TASB and the establishment of a data processing infrastructure 2003-2006
2 Training of TASB staff on the implementation of relevant acquis 2003-2006
3 Determination of the principles concerning the rules of procedure for TASB, and the principles and procedures regarding the quality, scope and the implementation of standards, via implementing regulations to be adopted by the Council of Ministers 2003-2006
4- Financing Requirements and Sources of Financing
Table 5.1.3 (Euro)

Requirements – (Capital Markets Board) Year National Budget EU Resources Other Resources Total
I- Investment
II- Harmonisation with the EU Legislation and Implementation
Personnel
Training
- Training for the implementation of EU legislation regarding Company Law (3 days, 3 experts)
- Training for the implementation of EU legislation regarding accounting and auditing (3 days, 3 experts) 2003-2006 (2x10,000) 20,000 20,000
Table 5.1.3 (Continued) (Euro)

Requirements – (Capital Markets Board) Year National Budget EU Resources Other Resources Total
Consultancy
Translation 2003-2006 2,500 7,500 10,000
Other
Total 2,500 27,500 30,000


Table 5.1.4 (Euro)

Requirements – (Turkish Accounting Standards Board) Year National Budget EU Resources Other Resources Total
I- Investment
Establishing a computer network between TASB, other public institutions and the private sector, in order to ensure transfer of information about accounting standards 2003-2006 60,000 180,000 240,000
II- Harmonisation with the EU Legislation and Implementation
Personnel recruitment
50 staff (Since the administrative structure of TASB has not been completed yet) 2003-2006 50,000 50,000
Training
Training for the implementation of 41 IAS standards (3 days, 7 activities, 1 expert) 2003-2006 25,000 25,000


Table 5.1.4 (Continued) (Euro)

Requirements – (Turkish Accounting Standards Board) Year National Budget EU Resources Other Resources Total
Consultancy
Consultant responsible for the determination of the rules of procedure of the commissions to be set up by TASB responsible for the implementation of 41 international accounting standards (3 consultants, 10 days) 30,000 30,000
Translation (2000 pages x 10 Euro) 2003-2006 5,000 15,000 20,000
Other
Total 115,000 250,000 365,000

PRIORITY 5.2 Intellectual Property Rights
1- Priority Description
With Law No. 5846 on Intellectual and Artistic Works and Law No: 4630 amending Law No. 5846, considerable alignment with the EU acquis on intellectual property rights has been accomplished. Nonetheless, efforts proceed for full harmonization concerning resale rights, copyright and related rights in the information society, which are in general terms already in conformity with the relevant Community legislation. Accordingly, legislative drafting continues for the legal protection of databases and the rights of their producers.
For effective implementation of the arrangements on intellectual property rights, combating piracy has significant importance. To this end, Law No: 4630 introduced significant changes, including effective mechanisms to prevent piracy, which is recognized as an organized crime. These amendments can be summarized as follows:
- Establishment of a compulsory and voluntary registration system in order to prevent the infringement of the rights of owners of the work and related rights, simplifying the procedure for proving ownership and monitoring the authorisations issued for benefits from financial rights.
- Increasing fines and imprisonment in case of infringements
- Concerning non-periodicals, cinema and music works, where unauthorised duplication is most popular, bringing new measures regarding the obligation to use holograms, and establishing monitoring commissions
- Preventing the entry of pirated goods at customs
- Introducing measures for closing places making unauthorised copies
Along with the preceding activities, with a view to removing the conflicts within national legislation, a draft law was prepared to re arrange fines and imprisonment in Law No. 3257 on Cinema, Video and Music Works according to the provisions of Law No. 5846.
Further, having scrutinized the Proposal for a directive of the European Parliament and of the Council on measures and procedures to ensure the enforcement of intellectual property rights (30 January 2003), a Draft Communiqué on The Rules To Be Obeyed By Recording Facilities Reproducing Intellectual and Artistic Works and Facilities Producing Empty Carrying Materials was prepared as the first attempt to incorporate the provisions of Article 22 of the Proposal. With this Communiqué, it will be mandatory to fix international codes on CD, VCD and DVDs, using implementations such as SID (Source Identification Code), ISRC (International Standard Recording Code). Thus production and recording facilities will be regulated.
Concerning international agreements, Turkey will become a party to the WIPO Copyrights Agreement and the WIPO Performances and Phonograms Agreement and will also finalize procedures for accession to the Rome Convention on the Protection of Performing Artists, Phonogram Producers and Broadcasting Enterprises1), and the Bern Convention Concerning the Protection of Literary and Artistic Works, in the short term.2)
In addition, there is an ongoing project in the field of intellectual and industrial property rights. The aim of the project is to fulfil the remaining commitments stemming from the Customs Union and to ensure effective and prompt implementation of the legislation by the courts. In this respect, within the framework of the MEDA Programme 2.289.450 Euros have been allocated to the project titled “Effective Implementation of Intellectual Property Rights” (Ref. No. DG1A-D/MEDTQ/02.99). Accordingly, it is envisaged to set up 7 specialized courts, and to train 7 judges and 1 public prosecutor both in Turkey and abroad. Furthermore, with the implementation of the said project, completion of the computer network infrastructure of the courts and the installation of an IT network between the courts, the Turkish Patent Institute, the Undersecretariat for Customs and the Ankara University Intellectual Rights Research Centre will be also maintained. Under the same programme, the establishment of the first reference library in Turkey and holding an international symposium are also envisaged.

2- Schedule of Necessary Legislative Changes
Table 5.2.1

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
1 Directive 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the resale right for the benefit of the author of an original work of art Law Amending Law No. 5846 on Intellectual and Artistic Works, Amended by Law No. 4630 Ministry of Culture and Tourism May 2004 1- May 2004


Table 5.2.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
2 Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases Law Amending Law No. 5846 on Intellectual and Artistic Works, Amended by Law No. 4630a) Ministry of Culture and Tourism May 2004 1- May 2004
3 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society Law Amending Law No. 5846 on Intellectual and Artistic Works, Amended by Law No. 4630 Ministry of Culture and Tourism May 2004 1- May 2004
4 Proposal for a Directive of the European Parliament and of the Council on measures and procedures to ensure the enforcement of intellectual property rights/* COM/2003/0046 final - COD 2003/0024 */ Communiqué on the Rules to be Obeyed by the Record Filling Facilities Reproducing Intellectual and Artistic Works and the Facilities Producing Empty Carrying Materialsb) Ministry of Culture and Tourism August 2003 2 - August 2003
a) Law No. 5846 on Intellectual and Artistic Works is in line with the Directive 96/9/EEC in general terms, following the amendments made by Law No: 4630. Accordingly, all authorization concerning financial and moral rights granted to the owner of the work, the fines and imprisonment in case of an infringement of rights are also valid for the databases. Yet, the Law does not include provisions for sui generis protection of databases. So, studies continue for incorporating this issue into Law. In this respect, the new arrangement will provide protection for the content of the databases and the rights of the producers.
b) Article22, paragraph 1 (b) of the Proposal for a directive of the European Parliament and of the Council on measures and procedures to ensure the enforcement of intellectual property rights (30 January 2003)

Table 5.2.2

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
1 Rome Convention (1961) for the protection of performers, producers of phonograms and broadcasting organizations Council of Ministers Decree on the Ratification of Turkey’s Accession to the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations, Approved by Law No. 4116. Ministry of Foreign Affairs
Ministry of Culture and Tourism September 2003
Table 5.2.2 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
2 Berne Convention for the protection of Literary and Artistic Works Council of Ministers Decree on the Ratification of Turkey’s Accession to Paris Act (1979) Amending the Berne Convention for the Protection of Literary and Artistic Works, Approved by Law No. 4117. Ministry of Foreign Affairs
Ministry of Culture and Tourism September 2003
Law approving the Ratification of Turkey’s Accession to WIPO Copyright Agreement Ministry of Foreign Affairs
Ministry of Culture and Tourism October 2003 1- December 2003
Council of Ministers Decree on the Accession Ministry of Foreign Affairs
Ministry of Culture and Tourism January 2004
Law approving the Ratification of Turkey’s Accession to WIPO Performances and Phonograms Agreement Ministry of Foreign Affairs
Ministry of Culture and Tourism October 2003 1- December 2003
Council of Ministers Decree on Accession Ministry of Foreign Affairs
Ministry of Culture and Tourism January 2004

3- Schedule of Necessary Institutional Changes
Table 5.2.3

No Necessary Institutional Changes – (Ministry of Culture and Tourism) Period of Implementation
1 Restructuring of the Directorate General for Copyrights and Cinema 2004 - 2005
2 Training of staff on EU implementations 2003 - 2005
Table 5.2.3 (Continued)

No Necessary Institutional Changes – (Ministry of Culture and Tourism) Period of Implementation
3 Organising “Training of the Trainers” seminars 2004 - 2005
4 Setting up an electronic archive for intellectual property products 2004 - 2005
5 Establishing computer network between the Ministry of Culture and Tourism, the Undersecretariat for Customs, and the courts 2004 - 2005
6 Establishing an IT network between central units and local offices of the Ministry 2004 - 2005
7 Ensuring accession to registered products in a virtual environment 2004 - 2005
8 Strengthening the technical and administrative infrastructure of collective societies 2004 - 2005
9 Giving seminars and conferences for the provision of information to the public and raising awareness 2003 -
10 Translation of the transposed Turkish legislation and the remaining EU legislation 2003 - 2004


Table 5.2.4

No Necessary Institutional Changes – (Ministry of Justice) Period of Implementation
1 In addition to the Istanbul Civil and Criminal Court on Intellectual and Industrial Rights, completing the establishment of other specialised courts 2003 – 2005
2 Training of judges and public prosecutors on judicial applications 2003 -

Further, within their job definition, police, municipal police, and the staff of Ministry of Finance and the Undersecretariat of Customs will receive continuous training in order to specialize in intellectual property rights.

4- Financing Requirements and Sources of Financing
Table 5.2.5 (Euro)

Requirements – (Ministry of Ministry of Culture and Tourism) Year National Budget EU Resources Other Resources Total
I- Investment 2004-2005 1,250,000 3,750,000 5,000,000a)
II- Harmonisation with the EU Legislation and Implementation
Personnel b)
Within the context of restructuring of the Directorate General for Copyrights and Cinema, recruitment of 50 personnel to be trained as experts 2004 -2005
Training
A series of training for personnel on EU implementations (6 seminars, each lasting for 3 days) 2003-2005 21,000 21,000
Organising “Training of the Trainers” seminars
(3 seminars, each lasting for 5 days) 2004-2005 15,000 15,000
Consultancy
Consultant support in order to prepare a project fiche for setting up an electronic archive for intellectual property products, strengthening the infrastructure of collective societies, accessing registered products in a virtual environment, and establishing a computer network between central and local offices of the Ministry and related institutions 2003-2004 100,000 100,000
Twinning to support the implementations concerning electronical archive and access to registered products in virtual environment (twinning light) 2005 500,000 500,000
Translation 2003-2004 10,000 10,000
Other
Total 1,250,000 4,396,000 5,646,000
a) It is envisaged to submit a project to the 2004 Programming Pre-accession Financial Assistance.
b) At this stage detailed financial needs for recruitment could not be determined.

PRIORITY 5.3 Industrial Property Rights
1- Priority Description
Due to the Customs Union considerable progress has been achieved concerning alignment with the EU Industrial Property Rights legislation. As for the remaining discrepancies, efforts proceed within the framework of a particular study program. Along with the progress on harmonization of the EU legislation, efforts for finalizing the accession procedures of the Trademark Law Treaty (TLT) and the Geneva Text of The Hague Agreement on International Registration of Industrial Designs have reached the last stage.
A draft law regarding the setting up of a union for patent and trademark attorneys was prepared and opened for consultation. Furthermore, the Draft Law Amending the Decree Law on the Establishment and Duties of the Turkish Patent Institute, prepared with the objective of updating the legislation, determining working principles and procedures of the Turkish Patent Institute, and eliminating deficiencies during implementation, has been under discussion in the relevant Commissions of the Turkish Parliament.
In addition, the implementation date for the Turkish legislation corresponding to the EU arrangements regarding supplementary protection certificates will be determined during the negotiation process, as the sector is not ready to absorb the potential consequences.
Additionally, an action plan concerning the protection of test data in medicines (data exclusivity) was presented to the European Commission in March 2003. Accordingly, the sector report, which will constitute the first step in determining the roadmap of Turkey and which aims at demonstrating the dimensions of the financial burden to be encountered has been concluded. Following the discussion of the report with the relevant services of the European Commission, the drafting of necessary amendments in the Law will start. It is envisaged that the studies will be finalized within the legislative period of 2003-2004.
In addition, there is an ongoing project in the field of intellectual and industrial property rights. The aim of the project is to fulfil the remaining commitments stemming from the Customs Union and to ensure effective and prompt implementation of the legislation by the courts. In this respect, within the framework of the MEDA Programme 2.289.450 Euros have been allocated to the project entitled “Effective Implementation of Intellectual Property Rights” (Ref. No. DG1A-D/MEDTQ/02.99). Accordingly, it is envisaged to set up 7 specialized courts, to train 7 judges and 1 public prosecutor both in Turkey and abroad. Furthermore, with the implementation of the said project, completion of the computer network infrastructure of the courts and installation of an IT network between the courts, the Turkish Patent Institute, the Undersecretariat for Customs, and the Ankara University Intellectual Rights Research Centre will be also maintained. Under the same programme, establishment of the first reference library in Turkey and holding an international symposium are also envisaged.
Further, in order to upgrade the industrial property system, 19 million Dollars have been allocated for the period of 1999-2003 within the scope of the Industrial Technology Project financed by the World Bank. This project comprises the strengthening of the physical infrastructure of the Turkish Patent Institute, providing technical assistance to the Institute, establishing information centres for raising awareness on the industrial rights system, and the training of sectoral and relevant government officials, including the judiciary responsible for implementation.







2- Schedule of Necessary Legislative Changes
Table 5.3.1

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
1 Council Directive 87/54/EEC of 16 December 1986 on the legal protection of topographies of semiconductor productsa) Law on the Protection of the Topographies of Integrated Circuits Turkish Patent Institute 31 December 2003 1- May 2004
2 94/700/EC: Council Decision of 24 October 1994 on the extension of the legal protection of topographies of semiconductor products to persons from Canada Law on the Protection of the Topographies of Integrated Circuits Turkish Patent Institute 31 December 2003 1- May 2004
3 94/824/EC: Council Decision of 22 December 1994 on the extension of the legal protection of topographies of semiconductor products to persons from a Member of the World Trade Organization Law on the Protection of the Topographies of Integrated Circuits Turkish Patent Institute 31 December 2003 1- May 2004
4 93/520/EEC: Council Decision of 27 September 1993 amending Decision 93/16/EEC on the extension of the legal protection of topographies of semiconductor products to persons from the United States of America and certain territories Law on the Protection of the Topographies of Integrated Circuits Turkish Patent Institute 31 December 2003 1- May 2004
5 96/644/EC: Council Decision of 11 November 1996 on the extension of the legal protection of topographies of semiconductor products to persons from the Isle of Man Law on the Protection of the Topographies of Integrated Circuits Turkish Patent Institute 31 December 2003 1- May 2004
6 Council Regulation (EEC) No 1768/92 of 18 June 1992 concerning the creation of a supplementary protection certificate for medicinal products Turkish Patent Institute Will be determined during the negotiation process.
Table 5.3.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
7 Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark Turkish Patent Institute Related Community legislation will be directly applicable upon membership. Therefore, an amendment to the existing Turkish legislation is not required.
8 Commission Regulation (EC) No 2868/95 of 13 December 1995 implementing Council Regulation (EC) No 40/94 on the Community trade mark Turkish Patent Institute Related Community legislation will be directly applicable upon membership. Therefore, an amendment to the existing Turkish legislation is not required.
9 Directive 98/44/EC of the European Parliament and of the Council of 6 July 1998 on the legal protection of biotechnological inventions Decree Amending Decree Law No. 551 Turkish Patent Institute April 2004 2- May 2004
10 Directive 98/71/EC of the European Parliament and of the Council of 13 October 1998 on the legal protection of designs Decree Amending Decree Law No. 554 on Protection of Industrial Designs Turkish Patent Institute December 2003 2- May 2004
11 Council Regulation (EC) No 6/2002 of 12 December 2001 on Community designs Decree Amending Decree Law No. 554 on Protection of Industrial Designs Turkish Patent Institute December 2003 2- May 2004



Table 5.3.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
12 Commission Regulation (EC) No 2245/2002 of 21 October 2002 implementing Council Regulation (EC) No 6/2002 on Community designs Turkish Patent Institute Related Community legislation will be directly applicable upon accession.
13 Regulation (EC) No 1610/96 of the European Parliament and of the Council of 23 July 1996 concerning the creation of a supplementary protection certificate for plant protection products Turkish Patent Institute Will be determined during the negotiation process.
14 Council Regulation (EC) No 2100/94 of 27 July 1994 on Community plant variety rights Law on the Protection of Breeders’ Rights Regarding New Plant Varieties b) Ministry of Agriculture and Rural Affairs 30.03.2003 1- 01.06.2004
2- 15.06.2004
a) Directives 94/700/EC, 94/824/EC, 93/520/EEC and 96/644/EC will be harmonised directly following alignment with the Council Directive 87/54/EEC.
b) Information on the implementing regulations, institutional and financial requirements concerning this law are provided in the Chapter titled Agriculture, Tables 7.3.2 and 7.3.3. The procedures for accession to the UPOV Convention on the Protection of Plant Varieties will be initiated following the entry into force of this Law.

Table 5.3.2

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
Law Approving the Ratification of Turkey’s Accession to Trademark Law Treaty Ministry of Foreign Affairs
Turkish Patent Institute January 2003 1- October 2003
Council of Ministers Decree on Accession Ministry of Foreign Affairs Turkish Patent Institute November 2003
Table 5.3.2 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
Law Approving the Ratification of Turkey’s Accession to the Geneva Text of The Hague Agreement on International Registration of Industrial Designs Ministry of Foreign Affairs Turkish Patent Institute January 2003 1- October 2003

Council of Ministers Decree on Accession Ministry of Foreign Affairs Turkish Patent Institute November 2003
3- Schedule of Necessary Institutional Changes
Table 5.3.3

No Necessary Institutional Changes – (Turkish Patent Institute) Period of Implementation
1 Strengthening of the institution by recruiting new staff 30 July 2003
2 Training of staff on EU implementations 30 November 2003
3 Provision of consultancy for the preparation and implementation of the legislation 30 December 2003
4 Translation of the transposed Turkish legislation and the remaining EU legislation 2003 - 2004
Table 5.3.4

No Necessary Institutional Changes – (Ministry of Justice) Period of Implementation
1 In addition to the Istanbul Civil and Criminal Court on Intellectual and Industrial Rights, completing the establishment of other specialised courts 2003 - 2005
2 Training of judges and public prosecutors on judicial applications 2003 -
Further, within their job definition, police, municipal police and staff of the Ministry of Finance and the Undersecretariat of Customs will receive continuous training in order to specialize in intellectual property rights.
4- Financing Requirements and Sources of Financing
Table 5.3.5 (Euro)

Requirements – (Turkish Patent Institute) Year National Budget EU Resources Other Resources Total
I- Investment
II- Harmonisation with the EU Legislation and Implementation
Personnel a)
In order to strengthen the administrative capacity, recruitment of 50 personnel to be trained in the fields of patents, designs and trademarks 2004
Training
Study-visits for the assistant experts working on patents, designs and trademarks to EU Member States (7 study visits, each consisting of a group of 5 people and lasting for 7 days) 2004 50,000 50,000
Study-visit to EU Member States to examine the implementations regarding integrated circuits, Community trademark system, The Hague Agreement, appeal procedures and the criteria used for issuing patents 2004 100,000 b) 100,000 b)
Training on International Agreements (5 days, 1 expert) 2004 5,000 b) 5,000 b)
Training on Community Design System (3 days, 1 expert) 2004 3,500 b) 3,500 b)
Provision of professional orientation to staff (10 days 2 experts) 2004 20,000 b) 20,000 b)
Consultancy
Technical assistance on internet applications (10 days, 1 expert) 2004 10,000 10,000
Provision of consultancy concerning databases implementations 12,500 b) 12,500 b)

Table 5.3.5 (Continued) (Euro)

Requirements – (Turkish Patent Institute) Year National Budget EU Resources Other Resources Total
Translation 2003 5,000 5,000
Other 2004 -2005
Total 65,000 141,000 206,000
a) At this stage, detailed financial needs for recruitment could not be determined.
b) This amount is expected to be financed from the resources allocated from the World Bank to the 2. Industrial Technology Project

















Annex 5.1

Secondary Legislation promulgated after the publication of the Council Decision of 8 March 2001 on the Accession Partnership with the Republic of Turkey


No Title of the EU Legislation Corresponding Turkish Legislation Responsible Institution Date and Number of the Official Gazette
1 Second Council Directive 77/91/EEC of 13 December 1976 on coordination of safeguards which, for the protection of the interests of members and others, are required by Member States of companies within the meaning of the second paragraph of Article 58 of the Treaty, in respect of the formation of public limited liability companies and the maintenance and alteration of their capital, with a view to making such safeguards equivalent Communiqué on Principles Regarding Dividend and Interim Dividend Payments of Corporations Subject to Capital Market Law Capital Markets Board 13 November 2001, No. 24582
2 Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission Implementing Regulation on the Rules and Procedures related to the Usage of Intellectual and Artistic Works on Radio and Television Broadcasting Ministry of Culture and Tourism 15 September 2001, No. 24524




6- COMPETITION POLICY

Secondary Legislation promulgated after the publication of the Council Decision of 8 March 2001 on the Accession Partnership with the Republic of Turkey is given in Annex 6.1.

I- PRIORITY LIST

PRIORITY 6.1 Competition Policy
PRIORITY 6.2 State Aids

II- MEASURES FOR HARMONISATION WITH THE EU LEGISLATION AND IMPLEMENTATION

PRIORITY 6.1 Competition Policy
1- Priority Description
In order to remove the obstacles that the Competition Authority has encountered from the outset of its activities on data collection and on-the-spot investigations, some amendments and additions to the Act on the Protection of Competition No. 4054 are envisaged. Moreover, effective implementation of administrative fines regulated by the aforementioned Act is intended.
Legislative Alignment on Competition Policy is divided into three headings, namely: “Legislative Alignment on Competition Policy”; “Special and Exclusive Rights”; “State Monopolies”.
A working group on “Special and Exclusive Rights” has been established in an attempt to compare Turkish Legislation with the related EU Legislation and to specify the necessary measures required for harmonisation. Additional information concerning liberalization in the Transportation, and Telecommunication and Energy sectors in this context is available under each heading.
In the field of state monopolies of a commercial character the harmonisation process is proceeding. Special importance is being given to efforts on alcoholic beverages, which constitutes one of the most essential priorities. Law No. 4733 on Restructuring of the Directorate General of Tobacco, Tobacco Products, Salt, and Alcohol Enterprises; and on Manufacturing, Domestic and Foreign Purchase and Sale of Tobacco and Tobacco Products; and Amending Law No. 4046 and Decree Law No. 2331) have abolished the monopoly rights of TEKEL and established the Tobacco, Tobacco Products and Alcoholic Beverages Market Regulatory Authority in order to ensure the regulation of the tobacco, alcohol and alcoholic beverages market. An action plan concerning the envisaged liberalization process in the alcoholic beverages sector was submitted to the European Commission in March 2003.
The Tobacco, Tobacco Products and Alcoholic Beverages Market Regulatory Authority has started to prepare the relevant implementing regulations concerning Law No. 4619, the Law Amending Law on Production of Spirits and Spirit Drinks2). Within this framework, the Implementing Regulation regarding the Rules and Procedures for Domestic and External Trading of Alcohol and Alcoholic Beverages was published in the Official Gazette No. 25130 on 6 June 2003.
The previously mentioned implementing regulation only defines rules and procedures with respect to the existing Law. In this context, efforts have already been initiated to provide further harmonisation with the EU acquis regarding the technical regulations and competition policy. The harmonisation process regarding the wine sector is covered more comprehensively in Chapter 7 - “Agriculture”.


2- Schedule of Necessary Legislative Changes
Table 6.1.1

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
1 Commission notice - Guidelines on Vertical Restraints (32000Y1013(01)) Manual for the Block Exemption Communiqué on Vertical Agreements No.2002/2 Turkish Competition Authority 31 December 2003 2- 31 December 2003
2 Commission Regulation (EC) No 2659/2000 of 29 November 2000 on the application of Article 81(3) of the Treaty to categories of research and development agreements Block Exemption Communiqué on Research and Development Agreements Turkish Competition Authority 31 December2003 2- 31 December 2003
3 Commission Regulation (EC) No 1400/2002 of 31 July 2002 on the application of Article 81(3) of the Treaty to categories of vertical agreements and concerted practices in the motor vehicle sector Group Exemption Communiqué on Group Exemption regarding Distribution and Servicing Agreements in relation to Motor Vehicles Turkish Competition Authority 31 December2003 2- 31 December 2003


Table 6.1.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
4 EEC Council: Regulation No 26 applying certain rules of competition to production of and trade in agricultural products (31962R0026) Turkish Competition Authority The definite date of transposition of the EU legislation on lines 4-17 of this table, which are foreseen to be transposed into the national legislation in the short term, will be determined during the meeting of the experts of the DG Competition and the Turkish Turkish Competition Authority just before the meeting of the EU-Turkey Single Market and Competition Sub-committee in 2003.
5 Commission notice of 18 December 1978 concerning its assessment of certain subcontracting agreements in relation to Article 85 (1) of the EEC Treaty (31979Y0103(01))
6 Council Regulation (EEC) No 4056/86 of 22 December 1986 laying down detailed rules for the application of Articles 85 and 86 of the Treaty to maritime transport
7 Council Regulation (EEC) No 3975/87 of 14 December 1987 laying down the procedure for the application of the rules on competition to undertakings in the air transport sector



Table 6.1.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
8 Commission Regulation (EEC) No 1617/93 of 25 June 1993 on the application of Article 85 (3) of the Treaty to certain categories of agreements and concerted practices concerning joint planning and coordination of schedules, joint operations, consultations on passenger and cargo tariffs on scheduled air services and slot allocation at airports
9 96/240/EC: Commission Decision of 5 February 1996 amending Decision 92/532/EEC laying down the sampling plans and diagnostic methods for the detection and confirmation of certain fish diseases
10 Commission Notice on the definition of relevant market for the purposes of Community competition law (31997Y1209(01))
11 Commission Regulation (EC) No 823/2000 of 19 April 2000 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices between liner shipping companies (consortia)
12 Commission Regulation (EC) No 2658/2000 of 29 November 2000 on the application of Article 81(3) of the Treaty to categories of specialisation agreements

Table 6.1.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
13 Commission Notice Guidelines on the applicability of Article 81 of the EC Treaty to horizontal cooperation agreements (32001Y0106(01))
14 Commission Notice on restrictions directly related and necessary to concentrations (52001XC0704(01))
15 Commission Notice on agreements of minor importance which do not appreciably restrict competition under Article 81(1) of the Treaty establishing the European Community (de minimis) (52001XC1222(03))
16 Commission notice on immunity from fines and reduction of fines in cartel cases (52002XC0219(02))
17 Commission Regulation (EC) No 358/2003 of 27 February 2003 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices in the insurance sector


3- Schedule of Necessary Institutional Changes
Institutional changes are not foreseen at this stage for the Turkish Competition Authority. The requirements for “Special and Exclusive rights” and “State Monopolies of a Commercial Character” could not be specified, since the process is proceeding.
4- Financing Requirements and Sources of Financing
Financing requirements are not foreseen at this stage for the Turkish Competition Authority. The requirements for “Special and Exclusive rights” and “State Monopolies of a Commercial Character” could not be specified, since the process is proceeding.
PRIORITY 6.2 State Aids
1- Priority Description
An authority responsible for monitoring and supervising state aids will be established as a requirement of the harmonisation of Turkish legislation and implementation of state aids with relevant EU Acquis. A Twinning Project was adopted under the “2002 Programming of Turkey-EU Pre-accession Financial Assistance” framework in order to provide assistance to the authority in its efforts on harmonisation and implementation.
2- Schedule of Necessary Legislative Changes
Table 6.2.1

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
1 Council Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article 93 of the EC Treaty Law on Monitoring and Supervising State Aid 2003 1- 2003
2 Commission Regulation (EC) No 68/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to training aid
3 Commission Regulation (EC) No 69/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to de minimis aid
4 Commission Regulation (EC) No 70/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises
5 Council Regulation (EC) No 3094/95 of 22 December 1995 on aid to shipbuilding



Table 6.2.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
6 Council Regulation (EC) No 1540/98 of 29 June 1998 establishing new rules on aid to shipbuilding
7 Council Regulation (EC) No 994/98 of 7 May 1998 on the application of Articles 92 and 93 of the Treaty establishing the European Community to certain categories of horizontal State aid
8 Commission Decision No 2496/96/ECSC of 18 December 1996 establishing Community rules for State aid to the steel industry
9 Commission Directive 80/723/EEC of 25 June 1980 on the transparency of financial relations between Member States and public undertakings
10 Commission Regulation (EC) No 2204/2002 of 12 December 2002 on the application of Articles 87 and 88 of the EC Treaty to State aid for employment
11 Commission Decision No 3632/93/ECSC of 28 December 1993 establishing Community rules for State aid to the coal industry
12 C2001/078/15 Commission communication concerning the review of the Community framework for State aid for research and development (Text with EEA relevance)

Table 6.2.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
13 Community guidelines on state aid for environmental protection ( 2001/C37/03)
14 Commission Notice on the application of Articles 87 and 88 of the EC Treaty to State aid in the form of guarantees (32000Y0311(03))
15 Rescue and restructuring aid - new guidelines (1999/C 288/02)
16 Communication of the Commission to Member States amending the communication pursuant to Article 93(1) of the EC Treaty applying Articles 92 and 93 of the Treaty to short-term export-credit insurance (2001/C 217/02)
17 Commission Notice on the application of the State aid rules to measures relating to direct business taxation (31998Y1210(01))
18 Amendments to the Guidelines on national regional aid* (2000/C 258/06)
19 Communication from the Commission - Multisectoral framework on regional aid for large investment projects (notified under document No C(2002) 315)* (2002/C 70/04)



Table 6.2.1 (Continued)

No Title and Number of EU Legislation Title of Draft Turkish Legislation Responsible Institution Proposed Date of the Approval of the Board / Minister / Council of Ministers Proposed Date of
1- Adoption by the Parliament
2- Entry into force
20 Communication from the Commission on the application of State aid rules to public service broadcasting* (2001/C320/04)
21 Commission communication on State aid and risk capital (2001/C235/03)
22 Notice on the extension of the period of validity of the Community framework for State aid to the motor vehicle Industry (32000Y0909(05))
23 Commission Communication on state aids elements in sales of land and buildings by public authorities. (97/C209/3)
24 Commission Communication on rescue and restructuring aids closure aids for the steel sector (2002/C70/5)
3- Schedule of Necessary Institutional Changes
Table 6.2.2

No Necessary Institutional Changes a) Period of Implementation
1 Provision of pre-accession advisor and legal advisor for implementation of the EU acquis 2003 - 2004
2 Provision of IT expert for establishing the IT system 2003 - 2004
3 Study visits to EU Member States’ aid agencies to observe the implementation of the new state aid system 2003 - 2004
a) Other requirements, such as personnel, apart from the ones given in Table 6.2.3 will be specified after the establishment of the national state aid monitoring and supervision authority.

4- Financing Requirements and Sources of Financing
Table 6.2.3 (Euro)

Requirements Year National Budget EU Resources Other Resources Total
I-Investment
II- Harmonisation with the EU Legislation and Implementation
Personnel
Training
- Training on the new system of state aids
- Study visits to EU Member States’ aid agencies to observe the implementation of the new state aid system 2003-2004
245,000

25,000

270,000
Consultancy
- Pre-accession Advisor
- Legal Advisor
- IT experts
- Other experts 2003-2004
400,000
115,000
80,000
60,000
655,000
Translation 2003-2004 60,000 60,000
Other
- Unforeseeable expenses
2003-2004
15,000
15,000
Total 1,000,000 1,000,000




Annex 6.1

Secondary Legislation promulgated after the publication of the Council Decision of 8 March 2001 on the Accession Partnership with the Republic of Turkey


Title of the EU Legislation Corresponding Turkish Legislation ) Date and Number of the Official Gazette)
Commission Regulation (EC) No 2790/1999 of 22 December 1999 on the application of Article 81(3) of the Treaty to categories of vertical agreements and concerted practices Block Exemption Communiqué on Vertical Agreements (No: 2002/2) 14.07.2002, No. 24815
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