Relations with the northern part of Cyprus

The purpose of this communication is to put forward measures promoting economic development in the northern part of Cyprus and bringing it closer to the European Union.

ACT

Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions of 3 June 2003, "Ways of promoting economic development in the northern part of Cyprus and bringing it closer to the Union" [COM (2003) 325 final – Not published in the Official Journal].

SUMMARY

In the absence of an overall settlement to the de facto partition of Cyprus, this communication proposes measures to promote the economy of the northern section of the island and bring it closer to the Union. Two types of measure are identified: financial assistance and trade.

Financial aid

In 2003, EUR 9 million in financial aid to promote economic development is to go to the following projects:

• infrastructure projects in large towns of the northern part of the island;
• grant aid to SMEs;
• preparatory studies for integration of the northern section into the Union once a political solution to the partition of the island has been found;

In 2003 the Commission will step up its information work to bring Northern Cyprus closer to the Union; EUR 3 million will be allocated to the following activities:

• organising seminars on the Community acquis for citizens of Northern Cyprus;
• organising visits by Turkish Cypriot citizens to EU institutions;
• consulting Cypriot authorities to find out how to encourage participation by citizens of the northern section in Community programmes;
• cooperation with Member States;
• support for civil society and social partners of the northern section;
• continuation of the translation of the Community acquis into Turkish.

Trade

The communication proposes adoption of a system enabling products from Northern Cyprus to be exported under a preferential tariff system pursuant to the Association Agreement signed between Cyprus and the Union. Since 1994, non-acceptance of certificates issued by the Turkish Republic of Northern Cyprus has prevented exports from this part of the island from benefiting from the preferential customs treatment granted to the rest of Cyprus under the Association Agreement. Under the new system, the Cypriot Chamber of Commerce will be responsible for issuing certificates for the movement of goods produced or obtained in the northern part of the island.

RELATED ACTS

Communication from the Commission to the European Parliament and the Council - Annual Report 2006-2007 on the implementation of Community assistance under Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of financial support for encouraging the economic development of the Turkish Cypriot community [COM(2007) 0536 final – Not published in the Official Journal]. This report follows the first year of the implementation of the economic assistance programme for the Turkish Cypriot community. The report is positive, in particular due to the strengthening of the administrative capacity. However, the programme duration was reduced from five years (2005-2009) to three years (2007-2009). The overall reduction in planning also means a reduction in the deadlines for awarding contracts.

Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of financial support for encouraging the economic development of the Turkish Cypriot community and amending Council Regulation (EC) No 2667/2000 on the European Agency for Reconstruction [Official Journal L 65 of 07.03.2006].

FREE MOVEMENT OF PEOPLE, SERVICES AND GOODS

Communication from the Commission of 27 August 2008 - Annual Report on the implementation of Council Regulation (EC) 866/2004 of 29 April 2004 and the situation resulting from its application [COM(2008) 529 final – Not published in the Official Journal]. The Commission considers that Regulation (EC) No 389/2006 constitutes an adapted legal framework. The number of people crossing the line doubled between 1 May 2007 and 30 April 2008, reaching the highest level since the green line was established. However, illegal immigration is still increasing. The flow of goods has increased by a third during the reporting period, despite the continuing obstacles to trade, particularly for goods originating in the northern part of the island, which is not under effective government control. The Regulation was amended on 16 June 2008, in order to facilitate trade between the two areas. The Commission shall continue to monitor the implementation of the Regulation.

Commission Decision 2007/330/EC of 4 May 2007 lifting prohibitions on the movement of certain animal products on the island of Cyprus under Council Regulation (EC) No 866/2004 and laying down conditions for the movement of those products (notified under document number C(2007) 1911) (Text with EEA relevance) [Official Journal L 123 of 12.5.2007].

Council Regulation (EC) No 866/2004 of 29 April 2004 on a regime under Article 2 of Protocol No 10 of the 2003 Act of Accession [Official Journal L 161 of 30.4.2004]. The areas where the Government of the Republic of Cyprus exercises effective control and those where they do not have effective control are separated by a line.

This line does not constitute an external border of the EU. This Regulation establishes the conditions under which checks on persons, goods and services crossing the line will be carried out.

Last updated: 07.09.2009