2.7. European Union Harmonization Activities

The screening process comprising the first phase of accession negotiations with the EU was started on 3 October 2005 and completed on 13 October 2006. Since completing the screening process, preparations for harmonization with the EU acquis have continued.

Table 2 shows developments on the relevant chapters, in which the Bank participated in the screening process as well as in the accession negotiations.

Among the chapters that are directly related to the Bank, Chapters “18. Statistics” and “32. Financial Control” were opened to negotiations on 26 June 2007 and Chapter “4. Free Movement of Capital” was opened to negotiations on 19 December 2008. Chapter “9. Financial Services” is one of the eight chapters which have been blocked by the decision “negotiations will be blocked until Turkey fully implements its obligations on Cyprus” given at the EU summit on 14-15 December 2006. However, under the harmonization scope of this chapter, the Law on Payment and Securities Settlement Systems, Payment Services and Electronic Money Institutions (Law No: 6493) was entered into force on 27 July 2013. This Law also provides harmonization with the relevant EU legislation in Chapter “4. Free Movement of Capital”.

Of the chapters that are directly related to the Bank, Chapter “17. Economic and Monetary Policy” was not opened to negotiations. Chapter “33. Financial and Budgetary Provisions” is still under review by the Council.

Since the technical negotiations with the European Commission, three of six closing benchmarks for Chapter “32. Financial Control” have been fulfilled. Among these three, “The legislative and administrative alignment with the Council Regulation (EC) No: 1338/2001, arranging the protection of the Euro from counterfeiting” is the one that the Bank has contributed to. Among chapters which are indirectly related to the Bank, Chapter “28. Consumer and Health Protection” was opened to negotiations on 19 December 2007, Chapter “6. Company Law” on 17 June 2008 and Chapter “16. Taxation” on 30 June 2009. Opening benchmarks have been established for Chapter “19. Social Policy and Employment”. Chapter “2. Free Movement of Workers” is still under review by the Council.

In order to monitor the progress achieved in alignment with the EU acquis and to report the progress to the Commission, the Bank continues to provide information to the Ministry of EU Affairs on the developments in the related Chapters.