Documents considered by the Committee on 20 October 2010 - European Scrutiny Committee Contents

13 Cyprus: the Green Line Regulation



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SEC(10) 1094

Annual Report on the implementation of Council Regulation (EC) No.866/2004 and the situation resulting from its application

Legal baseArticle 11 of Council Regulation (EC) No.866/2004; —
Document originated21 September 2010
Deposited in Parliament28 September 2010
DepartmentForeign and Commonwealth Office
Basis of considerationEM of 12 October 2010
Previous Committee ReportNone; but see (30977) 13289/09: HC 19-xxviii (2008-09), chapter 12 (21 October 2009); also see (31586) 9284/10: HC 428-iii (2010-11), chapter 14 (13 October 2010)
Discussed in CouncilTo be determined
Committee's assessmentPolitically important
Committee's decisionCleared


13.1 Since Turkish troops landed in Cyprus in 1974 the island has been effectively partitioned, with approximately 37% of the territory of the Republic not under the control of the Government of the Republic of Cyprus (RoC). A "Green Line" buffer zone divides the island and is patrolled by United Nations forces. A significant Turkish troop presence remains in the northern part of Cyprus.

13.2 Pending a settlement of the Cyprus problem, Article 1 of Protocol 10 of the Act of Accession provides that the application of the EU's acquis will be suspended in those areas in which the Government of the Republic of Cyprus does not exercise effective control — that is, the northern part of the island — while Article 2 states that the Council should define the terms under which the provisions of EU law should apply to the line dividing the island (i.e., the Green Line). Protocol 3 of the Act of Accession puts in place special arrangements for the Sovereign Base Areas (SBAs).[51]

13.3 Regulation No 866/2004 established a regime under Article 2 of Protocol 10 with special rules concerning goods, services and persons crossing the line between those areas of the RoC in which the RoC Government does not exercise effective control and those areas in which it does. The Regulation, which came into force on 1 May 2004, followed the rejection in April 2004 of the UN's settlement plan for Cyprus (the Annan Plan) by the Greek Cypriots. To ensure its effectiveness, this also covered the boundary between the northern part of Cyprus and the Eastern Sovereign Base Area. Several amendments have been adopted designed to further facilitate trade across the Green Line, while safeguarding proper functioning of EU rules and policies within the single market.

The Commission Report

13.4 The report covers the period from 1 May 2009 to 30 April 2010. It concludes that the Green Line Regulation continues to provide a workable basis for allowing the passage of persons and goods to the government-controlled areas of the Republic of Cyprus.

13.5 A year ago, the total value of recorded trade across the Green Line during the reporting period amounted to €6,111,030 compared to €4,473,408 in the previous reporting period; 30% of which was accounted for by trade in potatoes. In this period, the Commission notes that the value of Green Line trade decreased for the first time since the Regulation came into force in 2004 — by 16.8% down to €5,232,328 — but says that this has mainly been attributed to a bad harvest and subsequent fall in the potato trade; excluding potatoes (which fell from 30% to 14% of overall trade), Green Line trade remained stable.

13.6 The Commission notes, however, that the overall scale of Green Line trade still remains limited, partly due to the restricted scope of the Regulation itself, and partly due to remaining obstacles to trade. As an example, the Commission says that Turkish Cypriot commercial vehicles, particularly those over 7.5 tonnes, cannot move freely across the island. No further progress is reported regarding other non-tariff trade barriers either. Many Greek Cypriots are said to be still reluctant to purchase Turkish Cypriot branded products, causing Turkish Cypriot traders to struggle to get their products stocked and advertised in the government-controlled areas.

13.7 The report notes that the smuggling of goods across the Line (mainly cigarettes, alcohol and seasonal goods such as game or fire crackers) remains widespread, but has decreased over the reporting period. Seven criminal cases were filed in 2010 compared to 11 in 2009.

13.8 The Commission states that the control of the Green Line at the authorised crossing points is satisfactory, and says that no major incidents were reported in relation to daily crossings. Although the number of apprehended illegal immigrants fell by 54% from the previous year, the report also says (as in previous Reports) that the illegal crossing of third country nationals still remains an area of concern and (ditto) recommends that surveillance on the Line between the crossing points conducted by the Republic of Cyprus and the SBA Administration should be strengthened to help tackle illegal migration, with particular reference on this occasion to several unauthorised crossing points near the village of Pergamos. However, the report also says that there is excellent cooperation the Republic of Cyprus and SBA Customs and Immigration.

The Government's view

13.9 In his Explanatory Memorandum of 12 October 2010, the Minister for Europe (David Lidington) says that the current Green Line Regulation is sufficient to protect the security of the EU, including by addressing illegal immigration and by regulating the flow of goods into the single market.

13.10 He continues as follows:

"The Government remains committed to ending the isolation of the Turkish Cypriot community and to facilitating the reunification of Cyprus by encouraging the economic development of the Turkish Cypriot community. Increased trade between north and south will contribute to the integration of the island and reducing the disparity in economic activity between north and south. It is disappointing, therefore, that overall trade did not increase this year, even taking the bad potato harvest into consideration, as highlighted in the report. However, the opening of the Limnitis crossing (October 2010) should further increase the scope for legal movement of people and goods across the Green Line."

13.11 In the event of a comprehensive settlement to reunite Cyprus, the Minister notes that the Green Line Regulation would become null and void, "and free trade would flourish between the two communities." He recalls the direct negotiations that began on 3 September 2008 between the two leaders in Cyprus aimed at reunifying Cyprus, which he describes in similar terms to those used by his ante-predecessor a year ago — "arguably … the best opportunity in a generation to finally achieve a comprehensive and durable Cyprus settlement, which all Cypriots can accept" — and says that the UK will continue to engage closely with all parties, in the region and wider, to support the efforts of the two leaders.

13.12 The Minister also observes that the continued implementation of the Regulation does not have significant financial implications for UK public expenditure or the EU budget; though the Regulation "already imposes additional monitoring requirements on the Sovereign Base Areas Administration … the Government considers that this is consistent with their other activities."

13.13 Finally, the Minister says that the Commission has presented the report to the Council's "Ad Hoc Working Group on the follow-up to the Council Conclusions on Cyprus of 26 April 2004", and that no further action is planned.


13.14 Though the report raises no questions, we note that the Minister makes no mention of the wider perspective, particularly the continuing failure to reach agreement on the implementation of long-standing proposal to permit direct trade between the EU and the Turkish-occupied part of the island and its wider ramifications; or of the election of a new leader of the Turkish Cypriot community in April, who is widely seen as more hard-line than his predecessor and who is quoted on his recent visit to Brussels as talking of the EU's "historic responsibility to encourage the Greek Cypriot side to come to the negotiating table" and of implementation of the direct trade proposal as essential to persuading the Greek Cypriot leadership of the need to compromise.[52]

13.15 As in previous years, we draw the Commission report to the attention of the House because of the widespread interest in developments in Cyprus, and clear the document.

51   For the Committee's consideration of the latest Commission Report on the special arrangements for the SBAs, see (31586) 9284/10: HC 428-iii (2010-11), chapter 14 (13 October 2010). Back

52   See European Voice of 16 September 2010, page 3. Back

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