Chapter 20- Enterprise and Industrial Policy

Content of the Chapter

EU’s enterprise and industrial policy has three policy sets; namely, enterprise policy, industrial policy, and sector specific measures that aim at enhancing competitiveness.  The acquis under this chapter is mostly composed of policy principles established by Commission communications, recommendations and Council decisions that do not require harmonization.

These principles aim at ensuring structural adjustment, creating the best environment for business, increasing internal and external investments, supporting small and medium sized enterprises (SMEs), research and development (R&D)/innovation activities and  entrepreneurship. In this respect, enterprise and industrial policy chapter crosscuts different horizontal policy areas.

The objective of this chapter is providing the best business environment for establishment and viability, enhancing entrepreneurial spirit of enterprises, and raising the competitiveness level of them, in harmony with the EU’s sustainable development targets.

Although the legislation on the scope of the chapter has been rather non-compulsory, it covers the directive 2011/7/EU on Combating Late Payment in Commercial Transactions, which requires harmonization among member states.

The EU provides support for enterprises through financial institutions, financial cooperation tools and Union Programmes. COSME (Programme for the Competitiveness of Enterprises and SMEs) and Horizon 2020 are the most important tools designed by the EU to support enterprises and SMEs. These programmes will be followed by Single Market , InvestEU  and Horizon Europe  in the new Multi-Annual Financial Framework 2021-2027.

In the latest period, “Investing in a Smart, Innovative and Sustainable Industry: A New Industrial Policy Strategy for the EU”  has been the key document for the EU Industrial Policy. The European Commission shared with the public its new Industrial Strategy on 10 March 2020 aiming at the climate-neutral and digital leadership transformation of the European industry. The strategy targets to increase Europe's competitiveness and strategic independence at a time of geopolitical changes and increasing global competition.

The EU's New Industrial Strategy lays out a set of actions to support all actors of European industry, including large and small companies, innovative start-ups, research centres, service providers, suppliers and social partners.

The New Industrial Strategy focuses on three key priorities to strengthen the leading position of European industry:

1- To maintain the global competitiveness of the European industry and to establish equal competition conditions both in Europe and at the global level,

2- To make the European economy climate-neutral by 2050,

3- Shaping Europe's digital future.

Within the scope of the European Industrial Policy Package, a new Industrial Strategy for Europe as well as a new SME Strategy  was shared with the public. The EU's New SME Strategy aims to help SMEs lead the targeted twin transformation in the new industrial strategy and have access to the right skills for it. SMEs are of great importance for the competitiveness and prosperity of Europe, as well as for economic and technological independence.

The European Commission published "Updating the New Industrial Strategy 2020: Creating a Stronger Single Market for the Recovery of Europe"  on 5 May 2021 to update its new Industrial Strategy. The Covid-19 pandemic and the accompanying developments have had a negative impact on EU societies and economies, as well as their industries and companies. The events have revealed the interdependence of global value chains and the value of a globally integrated Single Market. The impact of the COVID-19 crisis on the European economy and industry according to preliminary calculations (6.3% contraction in 2020) and the experiences during this crisis prove that the principles, priorities and actions in the New Industrial Strategy are still valid.

Current Stage of the Negotiations on the Chapter

The screening meeting of the 20^th chapter were held in spring 2006 and the final Screening Report was conveyed to Türkiye on 18 September 2006.  The Turkish and EU sides prepared their negotiation papers respectively on 5 February 2007 and 28 February 2007. The chapter was opened to negotiations on 29 March 2007.

There is no opening benchmark under this chapter.

Closing Benchmark

There is one technical closing benchmark:

Türkiye provides the Commission with a revised comprehensive industrial policy strategy aiming at strengthening Türkiye's industrial competitiveness.

This Strategy was prepared under the coordination of the former Ministry for Science, Industry and Technology, with the participation of the relevant institutions and approved by the High Planning Council on 7 December 2010. It was published in the Official Gazette No: 27828 (bis) of 27 January 2011. The European Commission officially informed Türkiye on 14 April 2011 that the Commission assesses the technical benchmark fulfilled; however, this does not prejudge the assessment to be made by the Council according to the established procedure. The Strategy was later updated for the periods 2015-2018 and 2019-2023.

In the Framework of the Chapter 20, Türkiye enacted “By-law on the Definition, Qualifications and Classifications of SMEs” in 2005 in order to transpose the Recommendation 2003/361/EC concerning the definition of micro, small and medium-sized enterprises. The by-law was amended on 4 November 2012 and full alignment with the EU acquis was ensured by fulfilling two criteria (annual turnover or annual balance sheet) instead of one by enterprises in order to be counted as an SME.

SME Strategy and Action Plan (2015-2018) was published in Official Gazette No: 29466 of 5 September 2015. In the post-2018 period, the relevant measures have been implemented in the KOSGEB Strategic Plan.

Türkiye’s Entrepreneurship Strategy and Action Plan (2015-2018) was prepared within the context of Entrepreneurship 2020 Action Plan of the EU. It was published in Official Gazette No: 29403 of 1 June 2015. 

Sector strategies and action plans for several sectors were prepared in collaboration with the relevant stakeholders by the Ministry of Industry and Technology.

Improvement of the business environment take a notable place in the chapter. Within the context of improvement of business and investment environment, Coordination Council of the Improvement of Business Environment (YOİKK) has been functioning since 2006 for increasing competiveness of the enterprises.

Türkiye participated to the project on the “Implementation and Follow-up of the Small Business Act (SBA) in the Pre-Accession Region” with Western Balkan countries for improving the business environment and SMEs in 2010. Small and Medium Enterprises Development Organization (KOSGEB) was designated as national coordinator of Türkiye within the framework of the Project. Three assessment reports were published in 2012, 2016, 2019 and 2022 respectively. By the Prime Ministry Circular on the Implementation of the Principles of Small Business Act for Europe published in 2011, public institutions and organizations are committed to take into consideration the principles of SBA when they formulate and implement all kinds of policies, strategies, action plans and activities related to SMEs.

Relevant Sub-Committee

Subcommittee No. 3 on Trade, Industry and ECSC (European Coal and Steel Community) Products

Links

European Commission Directorate General for Internal Market, Industry, Entrepreneurship and SMEs:

http://ec.europa.eu/growth/

COSME Programme:

https://ec.europa.eu/growth/smes/cosme

http://cosme.kosgeb.gov.tr/

Screening Report of the 20^th Chapter:

https://www.ab.gov.tr/files/tarama/tarama_files/20/screening_report_20_tr_internet_en.pdf