1 A VIABLE SOLUTION TO THE CYPRUS PROBLEM: Lessons from Political Economy By Andreas P. Kyriacou Published by Intercollege Press, Nicosia, Cyprus, 2003
1
A
VIABLE SOLUTION TO THE
CYPRUS PROBLEM:
Lessons from Political Economy
By
Andreas P. Kyriacou
Published by Intercollege Press, Nicosia, Cyprus, 2003
2
To all Cypriots
in the hope that they can live together in peace and prosperity
3
‘Persons are neither bees in hives, carnivorous beasts in a jungle, nor
angels in God’s heaven. They are independent units of consciousness,
capable of assigning values to alternatives, and capable of choosing
and acting in accordance with these values. It is both physically
necessary and beneficial that they live together, in many and varying
associations and communities. But to do so, they must live by rules that
they can also choose.’
James M. Buchanan, Nobel Laureate in Economics, 1986
4
Acknowledgements
The ideas contained in this study first emerged in the context of my PhD thesis
defended in early 1999 and they were further developed in the form of academic
papers published over the course of the year 2000. This book presents many of the
insights contained in that research in a more accessible way but goes beyond this by
further developing and refining the key ideas. Moreover, it incorporates the latest
developments and in particular takes into account the (revised) Comprehensive
settlement presented by the UN Secretary General in December of 2002 as well as
the EU’s decision in that same month to invite Cyprus to become a full member of
the Union. I would like to acknowledge here the help of various people who have
both agreed and disagreed with my analysis along the way.
At the PhD stage, I would like to thank Jordi Bacaria (European University
Institute, Autonomous University of Barcelona), Roger Congleton (Center for the
Study of Public Choice, George Mason University), Diego Cordobez (formerly, UN
Secretary General Special Advisor to Cyprus), Bruno Frey (Institute for Empirical
Research in Economics, University of Zurich), Pedro Puy Fraga (Department of
Applied Economics, University of Santiago de Compostella), Alan Hamlin
(Department of Economics, University of Southampton), Dennis Mueller
(Department of Economics, University of Vienna) and Eric Naisser (deceased –
formerly Law School, Rutgers University).
At the latter, publication stage I would also like to thank the editors and
anonymous referees of the following academic journals: International Review of Law
and Economics, Mediterranean Politics and The Cyprus Review. Thanks also to both
Oriol Roca (Department of Applied Economics, Autonomous University of
Barcelona) and Sofoclis Hadjiyiannis, for taking the time to discuss the latest peace
proposal put forward by the UN Secretary General and in particular for illuminating
some of its more practical aspects. Thanks finally to Andreas Theophanous (Research
5
and Development Center, Intercollege) whose genuine interest for the ideas contained
herein have made possible the publication of this monograph.
I would be amiss if I failed to acknowledge a special debt to my family for
their unending patience, support and enthusiasm from the first day I started thinking
about these issues.
A.P.K
February 2003
Barcelona
6
CONTENTS
Chapter 1. Introduction
Chapter 2. A Brief History of the Cyprus Problem
Chapter 3. A Federal Cyprus
Chapter 4. A Viable Solution to the Cyprus Problem
Chapter 5. A Viable Solution in the Context of EU Accession
Chapter 6. Conclusions
References
Annex A. The 1992 United Nations Set of Ideas
Annex B. The Comprehensive Settlement of the Cyprus Problem
Annex C. The European Union’s Position Towards the Cyprus Problem
7
FIGURES
Figure 1. From the Status Quo to a Reunified Cyprus
Figure 2. From the Status Quo to a Federal or Confederal Republic of Cyprus
Figure 3. The Effects of Time on Bargaining for a Solution
Figure 4. The EU’s Pre-accession Strategy
8
CHAPTER 1.
INTRODUCTION
One can speak of, at least, eight broad approaches to the academic analysis of the
Cyprus Problem1:
(i) a descriptive historical approach which sets out to record the train of
events related to the conflict;
(ii) an international relations approach which analyzes the impact of state
interests on the origins and evolution of the conflict;
(iii) a legal approach which puts the conflict within the context of relevant
constitutional and international law;
(iv) a political sociology approach which considers the influence of
domestic political and social factors on the conflict;
(v) a political anthropology approach which focuses on the influence of
customs and traditions on inter-ethnic political relations;
(vi) a psychological approach which analyzes inter-ethnic relations through
the personality, character traits and perceptions of Greek and Turkish
Cypriots;
(vii) a geographical approach which studies the geographical dimension of
the conflict and its possible resolution and finally;
(viii) a political economic approach which examines the economic
implications of the reunification of Cyprus under (some form) of federal
framework.
1 See, Harvey (1989) for a survey of the literature dedicated to the study of the Cyprus Problem. Most of the
more recent research has either been published or reviewed in the pages of The Cyprus Review, launched in
1989.
9
In this monograph, I apply a political economy approach to evaluate the different but
interrelated elements of the Cyprus Problem namely, constitutional arrangements,
security concerns, territorial adjustments, freedom of movement and establishment
and the right of property as well as the issue of a federal versus confederal Cyprus.
My approach is political in that the object of analysis are those constitutions-
institutions or arrangements proposed to allow the peaceful coexistence of the
citizens of a reunified island and economic in that it employs the tools of analysis of
that discipline.
As the quote by James Buchanan (1990) at the beginning of this book
indicates, social interaction requires that individuals live under mutually agreed-upon
rules. The search for these rules constitutes the normative purpose of the political
economy approach I undertake here and requires the positive analysis of alternative
sets of rules. As the title of my study indicates, I am concerned here with those rules
or arrangements which may allow all Cypriots, Greek, Turkish or other, to live
peacefully together in a reunified Cyprus.
Of course, this political economy approach is also related to those others
described that have been brought to bear on the Cyprus Problem. Thus, the historical
experience of living under different rules of the game may illuminate the evaluation
of different rules. In addition, the approach depends on some understanding of the
legal consequences of rules since this defines the extent to which they can constrain
the choices of individuals. Finally, to the extent that it employs the tools of orthodox
economics it parallels those other political economic analyses of the conflict.
Having said this however, my approach differs from previous approaches on
several counts. It takes individuals and not states to be the basic unit of analysis. In
line with this and true to its economic nature, it moreover assumes that rational
individuals may have a taste or preference for their ethnic group and that their
expression of this preference may be influenced by the costs of such expression, as
these emerge from formal institutional structures such as rules, laws and
10
constitutions. As such, it takes a reductionist view of many sociological, cultural and
psychological factors.
I begin my discussion with a brief review of the history of the Cyprus
Problem in chapter 2. For those unfamiliar with the conflict, it would seem prudent
to begin a reading of this study there. Being brief, this review is likely to omit some
details but the aim is to focus on the most important proposals which have been put
forward for the resolution of the conflict. Like all historical accounts, the
interpretation of some events is open to criticism. This said, a sincere effort has been
undertaken for maximum objectivity and neutrality. For this I have largely drawn
from independent scholars as well as the proposals themselves. At the same time I
have not ignored relevant insights put forward by those who have dealt with the
conflict as policymakers.
I then turn my attention in chapter 3 to an analysis of the federal and bicameral
systems which form a central part of the latest United Nations (UN) proposals aiming
at a solution to the conflict namely, the 1992 UN Set of ideas on an overall
framework agreement on Cyprus (hereafter referred to as the Set of ideas) and the
latest and revised Comprehensive Settlement of the Cyprus Problem (hereafter
referred to as the Comprehensive settlement). My analysis centers on the proposed
systems’ ability to enhance the viability of any solution to the Cyprus Problem, as
measured by their capacity to reduce the emergence of permanent tyrannical
majorities or minorities. My analysis leads me to propose alternative constitutional
structures to those currently envisaged. In particular, I argue that a well designed
functional and bicommunal federation would be a better institutional set-up.
Having identified and discussed in chapter 3 the importance of minimizing the
emergence of disaffected majorities or minorities for the viability of any solution, in
chapter 4 I consider four additional factors which I argue may have a direct bearing
on viability namely, the relative capacity of the Greek and Turkish Cypriot sides to
impose costs in the event of either breaking off from inter-ethnic co-operation, the
extent to which each party perceives the solution to be fair, the continuous influence
11
of informal rules which may promote ethnic identification and finally, the judicial
enforcement and legislative maintenance of the agreed-upon solution. The discussion
generates a number of ideas on the important elements of the dispute namely, a
federal versus a confederal solution, security guarantees, territorial adjustments, the
freedom of movement and establishment and the right of property. My main concern
is, again, with the viability of any solution.
The analysis in chapters 3 and 4 allow me to consider the possible effects on
the viability of a solution to the conflict of both the island’s European Union (EU)
pre-accession course and its eventual membership of the EU. In chapter 5 I argue
that through its pre-accession policy for Cyprus, the EU is seeking to contribute
towards a solution to the Cyprus Problem by emphasizing the security and economic
benefits that would be enjoyed by all Cypriots from EU membership and by
attempting to wring concessions from both the Greek and Turkish Cypriot sides.
After identifying this strategy, I discuss several factors that may directly affect the
viability of a final solution to the Cyprus conflict and which are moreover related to
EU accession namely, the likelihood of majority tyranny of the minority, the
presence of effective security guarantees, the perceived fairness of a solution, and
finally, the possible emergence of alternative sources of identity and the “logic of
appropriateness”. The second and third of these factors have important implications
for the EU’s pre-accession strategy while the remaining two suggest that eventual
membership of the EU is likely to increase the viability of a reunified Cyprus.
I conclude this monograph with chapter 6, where I bring together the most
important insights and institutional implications which have been brought to light by
the previous chapters. Given that they form an integral part of the analysis in the
main text, I attach in Annex A and B respectively, the Set of ideas and the revised
Comprehensive Settlement presented by the UN Secretary General in early
December of 2002. In annex C I summarize the EU’s positions vis-à-vis the Cyprus
Problem since the Republic’s application to join the Union in July of 1990.
12
CHAPTER 2.
A BRIEF HISTORY OF THE CYPRUS PROBLEM2
INTRODUCTION
The Republic of Cyprus was established on the 16th
of August 1960 after a five-year
guerilla war launched by the National Organization of Cypriot Fighters (Greek
acronym, EOKA) against Great Britain of which Cyprus was a colony. EOKA’s
struggle took place within the context of British denials to discuss the future status of
the island in a post World War II climate partly characterized by a feeling of anti-
colonialism and increasing demands by subjected peoples for self-determination (a
right recognized by Articles 1, 2 and 55 of the UN Charter). For EOKA, self-
determination could only mean the union of Cyprus with Greece (enosis), an
objective which was clearly shared by the great majority of Greek Cypriots as
indicated by a Church-organized plebiscite in January, 1950. Of the eligible Greek
Cypriot voters, 95.7% signed the petition for union with Greece.
The struggle for enosis led to the polarization of the two communities on the
island for two main reasons. Firstly, despite the fact that EOKA initially confined
itself to attacking the UK forces, the colonial authorities recruited large numbers of
Turkish Cypriots as auxiliary police. Consequently as the casualties mounted so too
did the inter-communal animosities. Secondly and for strategic reasons, Turkey
feared the possibility of a Hellenic island so close to its shores. As a result it
gradually pursued a policy of partition (taksim) and double enosis or, in other words,
the partition of the island and the unification of the resultant parts with Greece and
Turkey respectively. To this end, the policy evolved that the Turkish Cypriots should
2 I have consulted the following secondary sources; Stephens (1966), Kyriakides (1968), Xydis (1973), Ehrlich
(1974), Bitsios (1975), Patrick (1976), Markides (1977), Attalides (1979), Polyviou (1980), Dekleris (1981),
Dentktash (1982), Hitchens (1984), Ertekün (1984), Joseph (1985), McDonald (1989), Clerides (1988-1991),
Drevet (1991), Panteli (1991), Kizilyürek (1993) and Kyle (1997). My primary sources are, of course, the
constitutions themselves, whether actual or proposed, as well as related legal decisions by international or
supranational organizations.
13
shun contacts with the Greek Cypriots and work towards the creation of an
autonomous community. As a result, the Turkish Resistance Organization (Turkish
acronym, TMT) was created.
The war of attrition imposed by EOKA and the gradual acceptance by the
British that they no longer needed Cyprus as a base but only bases in Cyprus led it
finally to relinquish its rule, not to Greece but to an independent Republic of Cyprus.
Thus, in August 1960 it ceded to the Republic of Cyprus 97.2% of the island,
preserving its defense interests through the creation of the Sovereign Base Areas.
THE 1960 CONSTITUTIONAL SETTLEMENT
The new Republic was based on arrangements negotiated by the governments of the
UK, Greece and Turkey, without the direct input of the Greek or Turkish Cypriots.
These arrangements, (elaborated in Zurich and endorsed in London and thus known
as the Zurich and London agreements) included three Treaties and a draft
Constitution whose provisions bound the definitive Constitution later elaborated by a
joint constitutional commission composed of representatives of the two communities
and of the Greek and Turkish governments with legal advisers.
Briefly, the Treaty of Establishment provided for two British Sovereign Base
Areas where the executive and legislative authority is bestowed upon the
Commander of the British Forces in Cyprus. In addition, according to the Treaty,
should the UK divest itself of sovereignty, the lands are to be transferred to the
Republic. The Treaty of Guarantee, excluded partition or union with any other state
and included undertakings by Greece, Turkey and the UK to ensure the maintenance
of the independence, territorial integrity and security of the Republic, and respect of
its Constitution. In the event of a breach of any of these conditions, the guarantor
powers were to ‘consult together with respect to the representations or measures
necessary to ensure observance’ and, if concerted action was not possible, each
reserved the right ‘to take action with the sole aim of re-establishing the state of
14
affairs created by the present Treaty’. Finally, the Treaty of Alliance required the
establishment of military contingents of 950 and 650 men respectively by Greece
and Turkey. These contingents, together with Cypriot military representatives were
to set up and train a 2,000 man Cypriot army.
Insofar as the Constitution is concerned this set up a consociational system based
on the notion of power sharing between the Greek Cypriot majority and the Turkish
Cypriot minority3. As such it requires all persons (including of those minority group
members who where neither Greek nor Turkish) to declare themselves to be
members of either the Greek or Turkish communities. The Armenian, Latin and
Maronite Christian communities which made up 2% of the total population all opted
to be “Greeks”. In addition,
1. The executive was to consist of a Greek Cypriot President and Turkish
Cypriot Vice-President, each with a veto over laws and decisions of the
Council of Ministers and the House of Representatives
2. The Council of Ministers was to consist of seven Greek Cypriots and three
Turkish Cypriots, with one of the key posts of defense, finance or foreign
affairs reserved for a Turkish Cypriot.
3. The House of Representatives was to consist of 35 Greek Cypriot members
and 15 Turkish Cypriot members elected by their respective communities.
Voting on key issues such as the imposition of taxes or duties or the
modification of the electoral law was to require separate majorities.
4. Greek and Turkish Communal Chambers were envisaged to deal with
religious, educational and cultural affairs. In addition, separate municipal
authorities were also to be set up for the administration of the respective
communities in the five largest towns – Nicosia, Famagusta, Limassol,
Larnaca and Paphos.
3 For a discussion of the general features of power sharing or consociational systems, see O’Leary & McGarry
(1995). The classic reference is Lijphart (1977).
15
5. Posts in the judiciary, civil service, police and gendarmerie were to be
appointed in a 7:3 ratio and the army was to be formed in a ratio of 6:4.
6. A Supreme Constitutional Court was established with three judges, one
from each community and a neutral President who was to be chosen jointly by
the Republic’s President and Vice-President.
The 1960 Accords were to some extent perceived as unfair by the Greek Cypriots
who considered them to be more reflective of the relative strengths of Greece and
Turkey than the will of the local population. Turkey’s superiority stemmed from its
relative proximity to Cyprus, its relative size and its relative importance in NATO
(making it less susceptible to US pressure). In the case of the Constitution, many
Greek Cypriots felt that it put excessive limits on majority rule. The Accords were
also seen by many as a betrayal of the cause of enosis.
THE FAILURE OF THE 1960 CONSTITUTION
In the spring of 1961 the Turkish Cypriots argued that the public service was not
being filled in a 70:30 ratio as required by the Constitution and in retaliation the
Turkish Cypriot members of the House refused to support an extension of the tax
laws. In response, the President ordered taxes to be collected under the pre-1960
income tax-law, on the ground that the right to a separate vote on tax matters did not
include ‘the right to use this privilege over other unconnected demands’. Later in this
same year, a vote by the Council of Ministers to establish an army in which soldiers
from the two communities would be integrated was vetoed by the Turkish Cypriot
Vice-President.
Problems also arose over the allocation of funds for the purposes of education
which according to the Constitution was to be organized by each community and be
financed by lump sum transfers from the central government at a ratio of 8:2 for the
Greek and Turkish Cypriot communities respectively, with additional needs to be
16
met by community-based taxes. The Turkish Cypriot community had difficulties in
meeting its needs through its own resources and so turned to greater subsidies from
the center which were resisted by the Greek Cypriots.
Above all, an important dispute arose over the establishment of separate
municipalities. New laws for the separate municipalities were supposed to come into
effect not more than six months after the Constitution but a deadlock emerged. The
Greek Cypriots had accepted the principle of separate municipalities expressed in the
Zurich-London agreements but subject to a review of how the principle worked in
practice. They came to see them as both practically unworkable (since the relatively
small number of Turkish Cypriots to come under each separate municipality would
be unable to finance the necessary local services) and as a politically dangerous step
towards partition. As a result they refused to set them up. Shortly after, the Supreme
Constitutional Court ruled that the pre-1960 income tax law was no longer in force
and that there was therefore no machinery for the assessment or collection of taxes.
These events, together with intense pressures from disappointed Greek Cypriot
unionists, prompted the Greek Cypriot President, in November 1963, to propose
thirteen constitutional amendments which severely reduced many of the rights
granted to the Turkish Cypriots by the 1960 agreements. Adoption of the proposals
would effectively create a unified state with unfettered independence. Thus, the
President proposed,
1. The right of veto of the President and the Vice-President was to be
abandoned.
2. The Vice-President was to deputize for the President in case of temporary
absence or incapacity to perform his duties.
3. The Greek President of the House of Representatives and the Turkish Vice-
President were to be elected by the House as a whole.
17
4. The Vice-President of the House of Representatives was to deputize for the
President of the House in case of his temporary absence or incapacity to
perform his duties.
5. The constitutional provisions regarding separate majorities for the
enactment of certain laws by the House of Representatives were to be
abolished.
6. Unified municipalities were to be established.
7. The administration of justice was to be unified.
8. The division of the security forces into police and gendarmerie was to be
abolished.
9. The numerical strength of the security forces and of the defense forces was
to be determined by law.
10. The proportion of Greek Cypriots and Turkish Cypriots in the composition
of the public services and the forces of the Republic was to be modified in
proportion to the ratio of the population of Greek and Turkish Cypriots.
11. The number of members of the public service commission was to be
reduced from ten to five.
12. All decisions of the Public Service Commission were to be taken by
simple majority.
13. The Communal Chambers would be abolished and a new system devised.
Should the Turkish community however desire to retain its Chamber in the
new system, such a course would be open to it.
These proposals were rejected outright by Turkey. Soon after, in late 1963, fighting
broke out between communal militias with casualties on both sides. A cease-fire line
(the Green line) was established by British troops in the capital Nicosia which, until
today, cuts the city in two. A UN peacekeeping force (UNFICYP) was also stationed
on the island and is still there. The year 1964 was marked by sporadic fighting.
Gradually, many Turkish Cypriots who had until then lived in mixed towns and
18
villages all over the island, fled their homes and took refuge in defended and
increasingly armed enclaves. These enclaves where subjected to a partial embargo by
the government and survived in part due to direct economic transfers from Turkey.
In response to repeated threats of invasion by Turkey, Greece stationed 10,000
troops on the island.
The administration provided for under the Constitution had collapsed since it
led to the withdraw from government of the three Turkish Cypriot ministers and the
boycott of the House by Turkish Cypriot representatives. In the period 1964-65 the
Greek Cypriots incorporated most of the 13 proposed amendments as well as
offering the Turkish Cypriots a Minority Bill of Rights. Over this period, the
National Guard was created with Greek Cypriot soldiers and headed mainly by
officers seconded from the Greek contingent. Conscription was introduced bringing
its strength to 15,000 men.
In March 1965, a report (known as the Plaza report) intended to serve as the basis
for a new solution, was submitted by the UN. Its main points were,
1. That Cyprus should remain an independent state, renouncing its right to
unite with Greece.
2. That it should be ‘demilitarized’. The question of the British bases was set
aside for later consideration.
3. There should be ‘no partition or physical separation of the two
communities’. The Turkish Cypriots ‘wished’ to be physically separated from
the Greek community, but this separation was utterly unacceptable to the
majority community and could not be imposed except by force. Nevertheless,
Turkish Cypriot rights should be guaranteed by the UN and supervised by a
UN Commissioner in Cyprus.
4. A settlement should depend in the first place on agreement between the
people of Cyprus themselves and talks should take place between Greek and
Turkish Cypriots.
19
Although the plan was received sympathetically by the Greek Cypriots and Greece it
was rejected by Turkey and the Turkish Cypriots who insisted that any settlement
should prohibit enosis and separate the two communities geographically under a
federal system of government.
A bloodless coup brought the military junta of the Colonels to power in
Greece in April 1967. In November of the same year, an attack by the Greek Cypriot
National Guard against Turkish Cypriots in the south of the island led to intense
international negotiations and ultimately the withdrawal of all the Greek troops on
the island in excess of the 950 man contingent. In June of the following year,
intercommunal talks began for the creation of a new constitutional order for an
independent Republic. These talks, which continued intermittently for the following
6 years, were violently opposed by Greek and Greek Cypriot unionists.
In November 1973 the military leadership of the Greek junta changed by way
of a coup within a coup which brought the hawks to power. In July 1974, this led to a
coup in Cyprus (executed by the Cypriot National Guard under its Greek
commanders and with the support of increasingly disappointed and disaffected
unionists under the banner of EOKA-B) and the overthrow of the Cypriot
government. While no violence was directed towards the Turkish-Cypriot
community, the coup nevertheless prompted Turkey to invade later that month,
styling its intervention as a peacekeeping operation designed to secure the safety and
constitutional rights of the Turkish-Cypriots. A second invasion, with a much greater
Turkish military presence took place in August and led to the death and
disappearance of thousands, the seizing of 37% of Cyprus and the eventual
displacement of over 200,000 people (160,000 Greek Cypriots and 40,000 Turkish
20
Cypriots). To this day, northern Cyprus is occupied by 30,000 to 35,000 Turkish
troops4.
In November 1974, the UN General Assembly adopted resolution 3212
(XXIX) which provided a framework for a solution to the Cyprus Problem. It urges
the withdrawal of all foreign troops and, in its key provision, calls for the respect of
the sovereignty, independence, territorial integrity and non-alignment of the
Republic of Cyprus, the cessation of all foreign interference, and for the taking of
urgent measures for the return of the refugees to their homes in safety. This
resolution was endorsed by the Security Council in December in its resolution 365
(1974) and thus its implementation was made mandatory.
A BIZONAL AND BICOMMUNAL FEDERATION?
Between 1964 and 1967 Turkey and the Turkish Cypriots publicly maintained that
Cyprus should become a federation divided into two separate territories with each
community having control of all governmental functions within its territory except
federal concerns such as foreign affairs and banking. This was rejected by Greece
and the Greek Cypriots who saw it as just a cover for partition. It also ran against the
Plaza report previously mentioned.
Soon after the Turkish invasion, late in 1974, the idea of a bizonal federation
emerged in the talks of the representatives of the two communities. The Greek
Cypriot side was ready to accept a bizonal federation provided that the Turkish
Cypriots maintained around 25% of the island thereby allowing about half of the
Greek Cypriots displaced to return to their homes. The Turkish Cypriots for their
part, demanded around 33%. Contacts between the two sides where broken off by
the declaration by the Turkish Cypriot leadership of the “Turkish Federated State of
Cyprus” (“TFSC”) in February 1975.
4 The territory seized contained approximately 80 per cent of citrus groves, 65 per cent of wheat fields, 45 per
cent of industry and 67 per cent of tourist installations. The principle port of Famagusta was captured and
21
The Turkish Cypriots presented it as a potential constituent of a future
federated Cyprus. At the same time however, they created all the institutions of an
independent state, including an executive, legislature, courts, police and army all
within a separate constitutional framework. Moreover, they instituted a program to
settle mainland Turks in the north of the island; a program which over the years has
led to the settlement of anything between 40,000 to 90,000 mainland Turks5.
For its part, the UN Security Council responded to the creation of the “TFSC”
by way of resolution 367 (1975), which among other things called for the urgent and
effective implementation of all parts and provisions of General Assembly resolution
3212 (XXIX) as endorsed by Security Council resolution 365 (1974). Moreover, and
in response to the settler program undertaken by the Turkish Cypriot leadership, the
General Assembly issued in November of the same year resolution 3395 (XXX)
which ‘urges’ all parties from unilateral action which changes the demographic
structure of Cyprus. The settlement program continued leading the General
Assembly to later deplore unilateral actions aiming to change the demographic
structure of Cyprus in resolutions 34/30 (1979) and 37/253 (1983).
A meeting between the leaders of the two communities in February 1977 led to a
High Level Agreement which set the parameters for all subsequent negotiations
namely:
1. An independent, non-aligned, bicommunal federal Republic was the
objective.
2. The territory under the administration of each community should be
discussed in the light of economic viability or productivity and land
ownership.
Nicosia international airport was bombed. 5 The UN (Demographic Yearbook, 1993) estimates are 40,000-50,000 while the Department of Statistics and
Research of the Republic puts this figure at 91 000 for 1995. Nobody knows for sure how many settlers there
are (see The Economist, October 4th
1997). A suggestion by the UN Secretary General in November 1992 for a
Cypriot-wide census to be conducted by an independent international agency has not been accepted by the
Turkish Cypriot leadership.
22
3. Questions of principles like freedom of movement, freedom of settlement,
the right of property and other specific matters, are open for discussion, taking
into consideration the fundamental basis of a bicommunal federal system and
certain practical difficulties which may arise for the Turkish Cypriot
community.
4. The power and functions of the federal government will be such as to
safeguard the unity of the country having regard to the bicommunal character
of the State.
This was followed by an equally important second High Level Agreement in May
1979 which stated, among other things, that:
1. The basis for talks will be the 1977 High Level Agreement and the UN
resolutions relevant to the Cyprus question.
2. There should be respect for the human rights and fundamental freedoms of
all citizens of the Republic.
3. The demilitarization of the Republic is envisaged, and matters relating
thereto will be discussed.
4. The independence, sovereignty, territorial integrity and non-alignment of
the Republic should be adequately guaranteed against union in whole or in
part with any other country and against any form of partition or secession.
A series of further talks took place and where followed in November 1983 by a
unilateral declaration of independence by the Turkish Cypriot side under the new
banner of the “Turkish Republic of Northern Cyprus” (“TRNC”). (The opposition
parties voted with the government under duress.) The Turkish Cypriots subsequently
added to their institutions a central bank, although the Turkish lira is used as the
currency of the “TRNC”. The declaration of the “TRNC” led, three days later, to
Security Council Resolution 541 (1983) which, inter-alia, deplores the declaration of
23
the purported secession of part of the Republic of Cyprus, considers the declaration
as legally invalid and calls for its withdrawal, calls for the urgent and effective
implementation of its resolutions 365 (1974) and 367 (1975) and calls on all states
not to recognize any Cypriot state other than the Republic of Cyprus. This is actually
the case since the “TRNC” is only recognized by Turkey.
Resolution 541 (1983) was later reinforced in May 1985 by Security Council
resolution 550 (1985) which condemns all secessionist actions, including the
purported exchange of ambassadors between Turkey and the “TRNC”, reiterates the
call upon all states not to recognize the purported state of the “TRNC” and calls
upon them not to facilitate or in any other way assist the aforesaid secessionist entity.
The resolution also considers any attempt to settle the occupied city of Varosha by
people other than its lawful inhabitants as inadmissible and calls for the transfer of
this area to the administration of the UN.
March 1986 saw the presentation by the UN Secretary General of the Draft
Framework Agreement which attempted to collate all the elements of consensus
from the years of negotiation. The agreement talked of,
1. Two provinces or federated states competent in all matters not assigned to
the federal government. The federal government was to be responsible for
foreign affairs, federal financing (including taxation and customs duties),
monetary and banking affairs, federal economic affairs (including trade and
tourism), post and telecommunications, international transport, natural
resources, federal health and veterinary matters, trading standards, federal
judiciary, appointment of federal officers and federal security and defense.
Ten of these areas were to be designated matters of special concern to the
Turkish Cypriots and hence subject to special voting rights.
2. The President was to be Greek Cypriot and the Vice-President Turkish
Cypriot each having veto rights on laws or decisions of the Council of
24
Ministers in agreed areas whose scope, it was understood, would exceed that
covered by the 1960 Constitution.
3. The Council of Ministers was to consist of seven Greek-Cypriots and three
Turkish-Cypriots with the possibility that the Foreign ministry will be
guaranteed to a Turkish Cypriot. Weighted voting (a simple majority with at
least one Turkish Cypriot vote) would be required to pass laws in one of the
ten designated areas.
4. A bicameral legislature was to be set up with a 7:3 ratio of Greek and
Turkish Cypriot representation, respectively, in the Lower House and an
equal representation of each in the Upper House. Adoption of legislation of
special concern to the Turkish Cypriots would require a majority of each
community’s representatives in both Chambers.
5. A deadlock resolving procedure was to be set up including conciliation
committees drawn from the legislature and ad hoc expert committees. Any
contested matter could be put to a referendum among the members of the
community opposing it. A Constitutional Court would rule on whether bills
were compatible with the charter or discriminated against a community and
adjudicate disputes relating to the distribution of powers and functions.
The two sides disagreed over the territorial adjustments to be made with the Greek
Cypriot side accepting a Turkish Cypriot province ‘of the order of 29 per cent’ and
the Turkish Cypriot side saying that it should be ‘in the order of 29+ per cent’. In
accordance with the 1977 High Level Agreement, the three freedoms were to be
discussed in the light of certain practical difficulties for the Turkish-Cypriot
community. For the Turkish Cypriots this ranged from a right by Greek Cypriots to
continue to own property in the north and to eventually settle there as long as the
Turkish Cypriots remained a majority, to the claim that the only Greek Cypriots who
would be allowed to return would be those economically useful with a license to
work but not of residence and previous property owners may or may not be
25
compensated. Finally, both sides agreed to set a timetable for the withdrawal of non-
Cypriot troops but the security guarantees to be established were to be either
international as demanded by the Greek Cypriots (excluding a role for the guarantor
powers) or according to the Treaties of Guarantee and Alliance as demanded by the
Turkish Cypriots (implying a right of unilateral intervention for Turkey).
The failure of the Draft Framework Agreement led to yet another attempt by
the UN to mediate a solution to the problem in March 1990. This too broke down
over the Turkish Cypriot leadership’s demand that the Greek Cypriot community
recognize their right to self-determination, within the context of federalism. More
specifically, there was a difference of opinion as to whether the Turkish Cypriots
should be defined as a “people” or “community”. In UN terminology, the former
classification is entitled to self-determination while the latter is not. For the Greek
Cypriots, the demand for self-determination could only mean the possibility of
secession.
In response to this the Security Council issued resolution 649 (1990) in March
1990 through which it reaffirmed its previous resolutions and reiterated its support
for the two high-level agreements in which the leaders of the two Communities
pledged themselves to establish a bicommunal and bizonal Federal Republic of
Cyprus that will safeguard its independence, sovereignty, territorial integrity and
non-alignment and exclude union in whole or in part with any other country as well
as any form of partition or secession. In October 1991 and April 1992 respectively,
Security Council resolution’s 716 (1991) and 750 (1992) were issued, which among
other things reiterated the content of resolution 649 (1990) and in particular called
for the creation of a bicommunal and bizonal federation.
In the summer of 1992, the UN Secretary General submitted a “Set of ideas
on an overall framework agreement on Cyprus” (these are reproduced in appendix A
at the end of this book). The Set of ideas by and large incorporated the constitutional
provisions which had been set out in the 1986 Draft Framework Agreement except
that the former includes a preference by Turkish Cypriots for the presidency to rotate
26
between a Greek and Turkish Cypriot and are silent on the issue of weighted voting
in the Council of Ministers. While the Greek Cypriot side accepted the Set of ideas
as a basis for negotiating an overall framework agreement, the Turkish Cypriot side
did not, diverging on several points.
These divergences became clearer in November 1992, when the UN Secretary
General submitted a report entitled “Summary of the current positions of the two
sides in relation to the Set of ideas” (United Nations, 1992). The “Summary“
indicates that the Turkish Cypriot leadership is pushing for a confederal arrangement
whereby constituent states each have their own sovereignty and come together in a
sovereignty association. Moreover it demands more checks and balances in the
federal executive body and in particular that the Council of Ministers be composed
of an equal number of Greek and Turkish Cypriots and operate on the basis of
consensus. Alternatively they argue for the ability of each federated state to enter
into agreements with foreign governments and international organizations without
the prior approval of the federal government (only in their areas of competence).
This same document shows the reluctant acceptance by the Greek Cypriot
side, of a “loose” federal arrangement with a single sovereignty as a basis for
negotiating an overall agreement6. Moreover, it has signaled that both the legislature
and the executive may be excessively burdened by checks and balances and in
particular: they argue that separate majorities in the Lower House are unnecessary
given the composition of the Upper one; they argue against a rotating presidency;
and are against the permanent assignment of a ministry to any community.
Alternatively, while they agree that each federated state should be able to enter into
agreements with foreign governments and international organizations in their areas
6 The terms federation (loose and strong) and confederation are employed by Theophanous (1996). He argues
that a federal state is one which itself is sovereign while in a confederation of states, sovereignty lies with the
component states. On this measure, the Set of ideas describe a federal state, while the posterior position of the
Turkish Cypriots leans towards a confederal arrangement. Insofar as the distinction between a strong or loose
federation, a defining characteristic is seen to be where the constitution assigns residual powers; in a strong
federation these would be assigned to the central government and in a loose federation they would be so to the
regions. According to the Set of ideas (paragraph 8) residual powers are assigned to the two federated states
pointing to a loose federal arrangement.
27
of competence, they argue that these agreements must be channeled through the
Foreign ministry of the federal Republic and that it should be subject to federal
approval.
The Turkish Cypriots, argue that any territorial adjustment must leave 29+ per
cent of the island under Turkish Cypriot administration as opposed to the
(approximately) 28 per cent envisaged in the Set of ideas (which would allow up to
half of the Greek Cypriots displaced by the conflict to return home) and accepted by
the Greek Cypriots as a basis for negotiation. As such the Turkish Cypriots envisage
fewer displaced Greek Cypriots returning to their homes and living under Greek
Cypriot administration. Insofar as security and guarantee considerations are
concerned, the Turkish Cypriot side insisted that there must be a continued Turkish
security guarantee, including a troop presence on the island and a continued legal
right of unilateral intervention by Turkish armed forces. The Greek Cypriot side on
the other hand, denied the unilateral right of intervention and called for the complete
demilitarization of the island with security guarantees to be provided by the
international community.
With respect to the exercise of the three freedoms between the Greek Cypriot
administered and the Turkish Cypriot administered areas, the Greek Cypriot side in
principle defends the unrestricted implementation of these rights in the long run
since it rejects any qualification of them which violates international human rights
law. Having said this it has accepted – as a basis for negotiation – restrictions on the
movement of persons who were or are involved in acts of violence or the incitement
of violence and/or hatred against persons of the other ethnic group. It has also
accepted, as such a basis, several other restrictions to the freedom of establishment
and the right of property. The Turkish Cypriot side points to the 1977 High Level
Agreement’s provision that consideration must be given to “the fundamental basis of
a bicommunal federal system and certain practical difficulties which may arise for
the Turkish Cypriot community” and seems to interpret this to mean that the return
of displaced Greek Cypriots should not be such as to make them a minority in that
28
territory under their control. To this effect, the Turkish Cypriot side has both set out
numerous specific restrictions to the right of property while at the same time warning
that these do not represent an exhaustive list. These restrictions go much further than
those envisaged by the Set of ideas.
The Set of ideas were endorsed by the Security Council in August and November
respectively by way of resolution 774 (1992) and resolution 789 (1992) and the latter
resolution also called on the Turkish Cypriot side to ‘adopt positions which are
consistent with the Set of ideas’. The eventual non adoption by the Turkish Cypriot
leadership of the Set of ideas as a basis for negotiating an overall framework
agreement led to continued efforts by the UN to mediate in the conflict and
eventually to talks between the leaders of the two communities in the summer of
1997 under its auspices. The UN issued a draft document outlining the principles
which it felt should underpin an agreement. The text, which was leaked, contained
the following points:
1. Cyprus should be recognized as the common home of the Greek Cypriot
and Turkish Cypriot communities, whose relationship in the federation would
be one of equals, not majority and minority.
2. The federal state would have a single sovereignty and international
personality, and a single citizenship. This single sovereignty would emanate
equally from the two communities, and one would not be able to claim
sovereignty over the other.
3. The two communities would establish the federation, and residual powers
would remain with the federated states.
4. Political equality would not mean numerical equality in the federal
administration, but would be reflected: (a) in the fact that amendments of the
Constitution would require the approval of both communities; (b) in the
“effective participation” of both communities in “all organs and decisions” of
the federal government; and (c) in further “safeguards” to ensure that the
29
federal government would not be able to adopt any measures against the
interests of one community.
5. The federal government would consist of an executive and a bicameral
legislature. There would be “deadlock-resolving machinery”. Each federated
state would be “administered by one community”, and each would decide on
its own arrangements for government. Each state would have “identical
powers and functions”.
6. The federal Constitution would safeguard the identity, integrity and
security of each community, as well as their political, economic, social,
cultural, linguistic and religious rights.
7. The independence and territorial integrity of the federation would be
safeguarded.
Neither side was happy with the text and eventually the talks failed. The Turkish
Cypriot side insisted that the “TRNC” should be granted prior recognition as a
sovereign state (so that the two sides can be treated as equals in the negotiating
process) before coming together with the Republic of Cyprus in a confederal
arrangement and that it should have the right to conclude international agreements
independently of the federal government. Moreover, it argued that there should be no
reintegration of the two communities, and property issues should be settled by
compensation and exchange. Finally, the Turkish Cypriot side argued for the
continuing presence of Turkish troops and, more generally, that Turkey’s security
guarantee should remain. The Greek Cypriot side on the other hand objected to the
idea of sovereignty emanating from the two communities rather than the “people of
Cyprus” (in doing so it varied its position compared to the Set of ideas), wants
settlers from the Turkish mainland to return to Turkey (accepting the right of
citizenship of those born on the island) and finally, defends the freedom of
movement and the right to own property throughout the island.
30
In June 1998, the UN Security Council reaffirmed by way of resolution 1179
(1998), its position that a Cyprus settlement must be based on a state of Cyprus with
a single sovereignty and international personality and a single citizenship, with its
independence and territorial integrity safeguarded, and comprising two politically
equal communities in a bicommunal and bizonal federation, and that such a
settlement must exclude union in whole or in part with any other country or any form
of partition or secession.
In December 1999 a round of proximity talks were initiated under UN
auspices with the aim of preparing the ground for substantial direct negotiations.
Direct talks began again on the 16th
of January of 2002 and led on the 11th
of
November of the same year to the submission by the Secretary General of the UN of
a “Comprehensive Settlement of the Cyprus Problem”. The two sides submitted their
written comments on the substance of this proposal and in response to these the
Secretary General submitted a revised plan (reproduced in Annex B). The
Comprehensive settlement is more detailed than the Set of ideas with regard to the
main elements of the Cyprus problem and moreover includes provisions which
regulate Cyprus’s relations with the guarantor powers and the EU. The key features
of the Comprehensive settlement are as follows:
1. The relationship between the two communities is not one of majority and
minority but one of political equality. The state is bizonal and composed of a
“common state” and two equal “component states”, one Greek Cypriot and
one Turkish Cypriot.
2. The Treaties of Establishment, Guarantee and Alliance will remain in force.
Cyprus will be demilitarized and there will be a UN peacekeeping operation
to monitor implementation of the new state of affairs. Moreover, there will be
Greek and Turkish contingents stationed on the island in the context of the
Treaty of Alliance.
31
3. There is a single Cypriot citizenship and, in addition, all Cypriot citizens shall
also have internal component state citizenship status which will determine
political rights at the common state level and may do so as well at the
component state one. The component states may limit the establishment of
residence not holding its citizenship status to control the flow of individuals
establishing in its borders for a period of 15 years and thereafter, limit their
number to a maximum of 28 per cent of its population. At the same time, no
later than 25 years after entry into force of the agreement the common state
and component states shall review these restrictions in light of experience.
4. The common state institutions are based on power sharing with representation
either being proportional to the number of people holding the internal
component state citizenship status of each component state with a minimum
level of representation for each (this is the case, for example in the Chamber
of Deputies and the Presidential Council) or requiring an equal number of
individuals from each component state (for example, in the Senate, the
Supreme Court and the common state police). The office of the President will
rotate every ten months among the six members of the Presidential Council
with no more than two consecutive Presidents coming from the same
component state. Transition periods are contemplated for the gradual adoption
of the new institutions.
5. Greek Cypriots and Turkish Cypriots living in specified villages in the other
component state as well as Maronites, Latins and Armenians shall enjoy
cultural and educational rights as well as a degree of representation in the
component states legislatures.
6. Territorial adjustments foresee 28.5 per cent of the territory remaining under
Turkish Cypriot administration. Properties in areas subject to territorial
adjustment will be reinstated but in the case of other properties dispossessed
owners may either have their properties reinstated or may receive
compensation depending among other things, on whether current users are
32
themselves dispossessed owners and the principle of bizonality (a maximum
of 9 per cent and in any given municipality or village and 14 per cent of the
total land area and of the number of residences shall be reinstated to persons
hailing from the other component state). There will be fiscal incentives for
disposed owners to sell, exchange or lease their property. A property board
will act as a clearinghouse of claims of reinstatement, compensation and sale,
exchange or lease of properties. Compensation will be financed by way of a
compensation fund which will issue bonds.
7. A Reconciliation Commission is set up to promote understanding, tolerance
and mutual respect between Greek and Turkish Cypriots.
8. Legislative, executive or judicial acts by any authority prior to the entry into
force of the new state of affairs are recognized as valid.
9. The EU is requested to accommodate the foreseen restrictions on the freedom
of establishment and right of property in the act of accession of Cyprus to the
Union.
10. The Comprehensive settlement together with the conditions for accession to
the EU will be submitted by each side to referendum on the 30th
of March of
2003.
At the time of writing, the Greek Cypriot leadership had accepted the plan as a
basis for negotiation while the Turkish Cypriot leadership had not done so.
THE EU DIMENSION
In the second half of 1990, the Republic of Cyprus submitted a formal application
for full membership of the European Community provoking a strong reaction from
Turkey and the Turkish Cypriot leadership. Among other things, in June 1991, an
agreement was signed for the abolition of passport requirements and provisions
33
made for the creation of a customs union between Turkey and the occupied north.
Moreover, steps were taken to prepare the ground for settlement of the city of
Varosha by people other than its lawful inhabitants7; a threat which was repeated
during 1997 in response to an intensification of the Republic’s defense program.
In March 1995 the EU decided to begin accession negotiations with the
government of the Republic of Cyprus six months after the end of the Inter-
Governmental Conference (meant in part to prepare the Union’s institutions for
enlargement). At the Luxembourg European Council of December 1997, it decided
to open negotiations with the Republic of Cyprus in the spring of the following year.
In March 1998 accession negotiations began with the Republic of Cyprus and it
invited representatives of the Turkish Cypriot community to participate in the
accession negotiations as a part of the Cypriot delegation. The government argues
that the prospect of EU membership may act as a catalyst on the search for a solution
to the conflict and argues that in the event that no solution is agreed to, the Republic
of Cyprus should be admitted to the Union and the application of the acquis
communautaire over the whole territory of the island would be pending the
subsequent re-unification of the island.
These moves are opposed by the Turkish Cypriot leadership which claims that
this would bring indirect enosis by uniting Greek Cypriots and Greece. They say that
Cyprus should enter only after a settlement and after Turkey has become a full
member. They also set as a condition for their participation in Cyprus-EU accession
negotiations, the international recognition of the sovereignty of the “TRNC”. In
response to these developments, both the Turkish Cypriot and Turkish leaderships
threatened to undertake the “partial integration” of the occupied north with Turkey in
the security, defense and foreign policy fields. Thus, a joint declaration between the
authorities of the “TRNC” and Turkey in July 1997 included the point that all steps
taken towards EU accession by the Greek Cypriots will be matched by further
7 Before the Turkish invasion, 80 per cent of Varosha was owned by Greek Cypriots. Since the invasion it has
been deserted.
34
integration between the TRNC and Turkey. Indeed, in August 1997 an “association
agreement” was signed which calls for “gradual economic and financial integration
on security, defense and foreign policy matters” and sets up an “Association
Council” to determine the measures to be taken for partial integration and to monitor
their implementation. When accession negotiations where eventually launched with
the government of the Republic of Cyprus on March 1998, Turkey reacted by lifting
customs barriers and signing a free trade agreement with the “TRNC”.
On the 12th
of December, 2002 Cyprus was invited to accede to the EU while
at the same time the European Council urged the leaders of the two communities to
negotiate a comprehensive settlement in the context of the Comprehensive
Settlement by the 28th
of February 2003. Moreover, the Council expressed its
willingness to accommodate the terms of a settlement in the Treaty of Accession in
line with the principles on which the EU is founded and decided that the application
of the acquis communautaire to the northern part of the island will be suspended
pending a settlement.
35
CHAPTER 3.
A FEDERAL CYPRUS
INTRODUCTION
At the heart of the Set of ideas on an overall framework agreement on Cyprus, lies a
bi-zonal and bicommunal federation where, on the one hand, each community
administers a so called federated state and on the other hand, the powers and
functions of the federal government are constitutionally limited to some areas and,
moreover, a bicameral system may require the consent of ethnic majorities in either
Chamber for decisions to be adopted.
The latest Comprehensive settlement avoids the terms federated states or
federal government using instead the terms component states and common state
government. This semantic difference aside, it envisages a bizonal federal state where
the powers and functions of, now, the common state government are constitutionally
limited to some areas. This is in line with the Set of ideas. However, by abandoning
bicommunalism and adopting instead the idea of internal component state citizenship
as the basis of representation in the bicameral system also envisaged, this latest UN
proposal breaks radically with the 1992 one as well as all previous UN proposals and
the High Level Agreements. To my knowledge, neither the Set of ideas nor the
Comprehensive settlement have been subjected to any sort of coherent and
methodical analysis and it is my intention here to undertake this task8.
This chapter is structured as follows. In the next two sections I set out,
respectively, the relevant constitutional proposals which are included in the Set of
ideas and the Comprehensive settlement and, in particular, those provisions that refer
to the allocation of powers and functions between the federal and regional
governments as well as the institution of a bicameral legislature. Having done so, I
36
will consider the various ways that majorities and minorities can be tyrannical and
relate this to the issue of institutional viability. Given this discussion, I will discuss
the implications for the relevant constitutional proposals in the case of Cyprus. I will
then propose an alternative institutional arrangement namely, a bicommunal but
functional federation.
THE SET OF IDEAS: A BIZONAL AND BICOMMUNAL FEDERATION
In this section I set out those paragraphs from the Set of ideas that are pertinent to my
analysis. These generally refer to part III of the Set of ideas which concerns itself
with the “Constitutional aspects of the federation”.
Paragraph 25, states that all powers and functions not vested in the federal
Government will rest with the two federated states (each of which, according to
paragraph 19, will be administered by one of the two main ethnic communities). The
federated states may decide jointly to confer additional powers and functions to the
federal Government or to transfer powers and functions from the federal Government
to themselves. This is reiterated in paragraph 9 of the “Guiding Principles” of the
overall framework agreement and is related to paragraph 21 of the said principles that
states that the federal Government cannot encroach upon the powers and functions of
the two federated states.
Paragraph 26 states that the federal government will have the following
powers and competencies: foreign affairs, the central bank, customs and coordination
of international trade, airports and ports as concerns international matters, federal
budget and federal taxation, immigration and citizenship, defense, federal judiciary
and the federal police, federal postal and telecommunications services, patents and
trademarks, appointment of federal officials and civil servants (on a 70:30 Greek
Cypriot/Turkish Cypriot ratio), standard setting for public health, environment, use
8 See Kyriacou (2000a) for an earlier and more theoretical analysis of the Set of ideas.
37
and preservation of natural resources, and weights and measures and the coordination
of tourism and industrial activities.
The legislature will be composed of a Lower House and an Upper House ...
(paragraph 28). All laws must be approved by both Houses (paragraph 29). The
Lower House will be bicommunal with a 70:30 Greek Cypriot/Turkish Cypriot ratio
(paragraph 30) while the Upper House will have a 50:50 ratio representing the two
federated states (paragraph 31)9. All laws will be approved by a majority in each
House. A majority of the Greek Cypriot or Turkish Cypriot representatives in the
Lower House may decide on matters related to foreign affairs, defense, security,
budget, taxation, immigration and citizenship, that the adoption of a law in the Lower
House will require separate majorities of the representatives of both communities
(paragraph 32).
If the two Houses fail to pass a bill or decision, they will initiate proceedings
to obtain consensus while ensuring the continued functioning of the federal
government. To this end a conference committee will be established. The conference
committee will be composed of two persons each selected by the Greek Cypriot and
Turkish Cypriot groups equally from among the members of the two Houses of the
federal legislature. The text of the legislation or decision agreed to by the conference
committee will be submitted to both Houses for approval (paragraph 34). In the event
the federal budget is not adopted in one or both Houses and until an agreement is
reached by the conference committee and is adopted by both Houses, the provisions
of the most recent federal budget plus inflation shall remain in effect (paragraph 35).
The Council of Ministers will consist of Greek Cypriot and Turkish Cypriot
ministers on a 7:3 ratio and the President and Vice-President (each from a different
9 Arguably, this should be read in conjunction with paragraph 3 (the relationship between the two communities
is not one of majority and minority but one of two communities in the federal republic); paragraph 4 (the
communities are politically equal); paragraph 5 (that this equality will be reflected in the fact that the approval
and amendment of the federal constitution will require the approval of both communities ... and in the equality
and identical powers of the two federated states); paragraph 10 (the federal republic will be one territory
composed of two politically equal federated states) and finally; paragraph 19 (each federated state will be
administered by one community). All this points to the likelihood that paragraph 31 implies that the Upper
House is meant to be constituted by an equal number of Greek and Turkish Cypriot representatives.
38
community) will designate the ministers from the respective communities who will
appoint them by an instrument signed by them both (paragraph 38). The President
and the Vice-President will discuss the preparation of the agenda of the Council of
Ministers and each can include items in the agenda (paragraph 39). Decisions of the
Council of Ministers will be taken by majority but decisions over foreign affairs,
defense, security, budget, taxation, immigration and citizenship – that is, the same
areas where separate majorities of the representatives of both communities may be
required in the Lower House, – will require the approval of both the President and
Vice-President (paragraph 40). Both the President and Vice-President will, separately
or conjointly, have veto powers in the areas of foreign affairs, defense, security, the
budget, taxation, immigration and citizenship and the right to send for
reconsideration any law or decision of the legislature or any decision of the Council
of Ministers (paragraph 42).
The federal judiciary will consist of a Supreme Court composed of an equal
number of Greek Cypriot and Turkish Cypriot judges appointed jointly by the
President and Vice-President with the consent of the Upper House. Its presidency
will rotate between the senior Greek Cypriot and Turkish Cypriot members of the
Supreme Court. (paragraph 43). The Supreme Court will deal with matters arising
under the federal Constitution and federal laws, and will be empowered to fulfill
other judiciary functions related to federal matters attributed to it by the federal
Constitution or federal legislation (paragraph 44). The federal Constitution will
establish the procedure for ascertaining the constitutionality of federal laws and
executive acts, as well as adequate machinery of judicial review to ensure the
compliance of legislative, executive, and judicial acts of the federated states with the
federal Constitution (paragraph 46).
Following the Set of ideas, the two sides have either clarified or altered their
positions (United Nations, 1992). For the purposes of my discussion here it is
important to point out that the Turkish Cypriot side has taken the position that the
Council of Ministers should be composed of an equal number of Turkish and Greek
39
Cypriots and should operate on the basis of consensus. On the other hand the Greek
Cypriot side has argued that given the composition of the Upper House, the provision
for separate majorities in the Lower House is unnecessary.
THE COMPREHENSIVE SETTLEMENT: A BIZONAL FEDERATION
Consider now the relevant provisions from the Comprehensive settlement which are
found in Draft annex I of the Foundation Agreement entitled “Constitution of
Cyprus” and in particular the sections of this annex which refer to “The common
state and the component states” and “The common state institutions” respectively.
Thus Article 13 of Draft Annex I states that the competencies of the common
state will be: external relations, relations with the EU, Central Banking, common
state finance (including budget and all indirect taxes) and common state economic
and trade policy, natural resources, including water resources, meteorology, aviation,
international navigation and the continental shelf and territorial waters of Cyprus,
communications, Cypriot citizenship and immigration, combating terrorism, drug
trafficking, money laundering and organized crime, pardons and amnesties,
intellectual property and weights and measures and antiquities.
Article 14 states that the component states shall exercise within their territorial
boundaries all the competences and functions not vested in the common state. In
relation to this division of powers, Article 3 of Draft Annex I states that the common
state shall fully respect and not infringe upon the powers and functions of the
component states and that each component state shall do likewise with respect to the
common state or the other component state. In addition, there shall be no hierarchy
between the laws of the common state and those of the component states. Unlike the
Set of ideas, nothing is said of the possibility that each component state decide jointly
40
to confer additional powers and functions to the common state government or
transfer powers and functions from the common state government to themselves10
.
Article 15 allows for the conclusion of cooperation agreements between the
component states or the component states and the common state. Moreover, it
stipulates that the component states shall strive to coordinate or harmonize their
policy and legislation in areas such as: tourism, environment, fisheries and
agriculture, industry and commerce, zoning and planning, sports and education,
health, social security and labor, family, company and criminal law and acceptance of
the validity of documents.
Article 21 refers to the composition and election of the common state
Parliament. It is to be bicameral with a Senate and a Chamber of Deputies each of
which will have 48 members elected for five years on the basis of proportional
representation and with the component states serving as electoral precincts. In
particular, the Senate shall be composed of an equal number of senators hailing from
each component state (24 each) elected on a proportional basis from each component
state11
. The Chamber of Deputies shall be composed of deputies from both
component states with seats attributed on the basis of the number of persons holding
internal component state citizenship status of each component state provided that
each component state shall be attributed a minimum of one quarter of the seats (12
seats).
Article 24 states that unless otherwise specified, Parliament will take decisions
by simple majority of members present and voting in both Chambers, including one
quarter of senators present and voting from each component state. Special majorities
requiring at least two fifths of sitting senators from each component state in addition
to a simple majority of deputies present and voting shall be required for: ratification
10
Arguably however, this possibility may emerge under Article 36 which allows for amendments to, among
others, the just stated articles on the division of power between the component state and the common state.
Thus, save for its Basic Articles which establish the bizonal federation , the Constitution can be amended after
the approval by both Chambers of Parliament (see below) and the submission of the amendments to
referendum by a separate majority of the people in each component states.
41
of international agreements on matters which fall within the legislative competence
of the component states; ratification of treaties and adoption of laws and regulations
concerning the airspace, continental shelf and territorial waters of Cyprus; adoption
of laws and regulations concerning citizenship, immigration, water resources and
taxation; approval of the common state budget; election of the Presidential Council
(see below); and other matters.
Articles 25 to 30 regulate the executive branch of government. Article 25 sets
up a six member Presidential Council in which the office of the Head of State would
be vested. The members of the Council would be elected by Parliament for a fixed
five-year term on a single list by special majority. It would be composed
proportionately to the number of persons holding the internal component state
citizenship status of each component state, though at least one third (two members)
must hail from each component state. It is to strive to take decisions by consensus
and when this is not possible and unless otherwise contemplated, by simple majority
with at least one member of the majority coming from each component state. The
members of the Council are to be equal with any one of them placing items on the
agenda. Its President and Vice-President shall not hail from the same component
state and the offices of these two positions are to rotate every ten calendar months
among the members of the Council with no more than two consecutive Presidents to
come from the same component state. Neither the President nor the Vice-President
shall have a casting vote. Each member of the Council is to head a Department
(common state ministry) with the heads of the Departments of Foreign Affairs and
EU affairs coming from different component states.
Article 29 envisages a Public Service Commission composed of an equal
number of persons hailing from both component states. The public service will be
composed proportionately to the population of the component states though at least
one-third of the public servants at every level of the administration must hail from
11
Article 11 of Draft Annex I clarifies that when talking of the component state origins of a person the
criterion shall be the holding of internal component state citizenship status.
42
each component state. Article 30 concerns the common state police and stipulates
that it is to be composed of an equal number of persons from each component state.
Insofar as the judiciary is concerned, Article 35 states that the Supreme Court
will count on an equal number of judges from each component state appointed by the
Presidential Council for a renewable term of seven years12
. The Supreme Court is to
have exclusive jurisdiction over disputes between the component states and between
one or both component states and the common state and between organs of the
common state. It also has exclusive jurisdiction to determine the validity of any
common state or component state law under the Constitution and shall be the appeals
court in all other disputes on matters which involve the interpretation of the
Foundation Agreement, the Constitution, common state laws or treaties binding upon
Cyprus. If a deadlock arises in one of the institutions of the common state preventing
the taking of a decision without which the common state or its institutions could not
properly function, or the absence of which would result in a substantial default on the
obligations of Cyprus as a member of the EU, the Supreme Court may, upon
application of a member of the Presidential Council, the President or Vice-President
of either Chamber of Parliament, or the Attorney-General or the Deputy Attorney
General, take an ad interim decision on the matter, to remain in force until such time
as a decision on the matter is taken by the institution in question. The Supreme Court
is to strive to reach decisions by consensus and issue joint judgments. However, all
decisions of the Supreme Court may be taken by simple majority.
TYRANNICAL MAJORITIES OR MINORITIES, STABILITY AND VIABILITY
Given the employment of majority rule for collective decision-making, a majority
can be tyrannical in several ways and depending on which of these emerges, the
ramifications can affect legislative stability or even threaten the very viability of the
polity. To better understand the ensuing discussion, let us assume that society is
43
made up of three persons called X, Y and Z. To simplify things, let us first assume
that society takes political decisions of the following nature: society must spend less
(option A), the same (option B) or more (option C) on education; we must be less
(A), the same (B) or more (C) permissive of freedom of speech, etc. etc13
. A majority
in this society represents two people in favor.
One way that the majority can tyrannize the minority emerges when the
members of the majority are not identical but no other majority can emerge to
challenge the existing one (Black, 1958). In the context of our three person society
this would be a situation where, for example, person X prefers A to B to C and Y
prefers C to B to A, but person Z prefers either B to C to A or B to A to C. In a
majoritarian system, B is preferred to A (by Y and Z) and B is preferred to C (by X
and again Z). B is called a Condorcet winner against which, by definition, no
alternative majority can be formed. From the point of view of either person X or
person Y, the majority is tyrannical compared to a liberal system where each of them
could adopt their own preferred options (which would be option A in the case of X
and option C in the case of Y.)
A worse kind of tyranny than that of the Condorcet winner is the tyranny of
one majority over another that can occur whenever a unique majority does not exist
(Riker, 1992). By way of illustration assume that person X prefers A to B to C, Z
prefers B to C to A and Y prefers C to A to B. If they now vote according to their
tastes, A beats B (by the votes of X and Y), B beats C (by those of X and Z) and then,
incoherently, C beats A (by those of Z and Y). No matter which alternative wins,
some other majority prefers a losing alternative. Thus if A beats B, C can beat A, B
can beat C and so on. The constant cycling of majority coalitions undermines the
12
Article 6 of the Foundation Agreement itself is more specific since it talks of a Supreme Court of nine
judges, three from each component state and three non-Cypriots. 13
Another way of saying this is that political issues are organized along one dimension from less to more.
44
stability of legislation as the losing majority repeals the legislation at the next
opportunity14
.
The third and worst type of majority tyranny under majority rule can emerge
when the members of the majority have identical preferences (Buchanan, 1954). This
would be the case, for example, if person X and person Z both prefer A to B to C,
while person Y prefers C to B to A. Under these circumstances X and Z can always
outvote Y and adopt A. To the extent that this is the case over all possible choices,
this amounts to the permanent marginalization of the minority and under these
circumstances, the only remaining option for the minority may be revolution
something which may seriously undermine the very viability of the state. Of course
the possibility must also be admitted for the emergence of the permanent tyranny of
the majority by the minority something which is increasingly possible in the presence
of more inclusive voting rules, double majorities or veto powers for minority groups.
Again, the persistent exercise of such powers may hamper the viability of the polity.
While the tyranny of the Condorcet winner may be preferable to that of the
cyclical majority, it can also be said that the tyranny of a cyclical majority is
preferable to permanent tyranny of the majority over the minority (and vice versa).
Indeed, it is the possibility that ordinary majority decisions are subject to reversal that
makes majority rule tolerably acceptable (Buchanan, 1954). Above all, social
decisions must ensure meeting the more general goal of the durability of political
institutions (Miller, 1983; Ordeshook, 1992). In short, it is no use setting up
institutions that promote stability in decision-making if the whole institutional edifice
is unsustainable over time. What emerges from this discussion is that a suitably
designed federal and bicameral system should first and foremost minimize the
14
Cycles are probably not frequent in one dimension (for example, when deciding to spend less, the same or
more on defense) but almost inevitable in two or more (for example, when deciding to spend more on defense
and less on education). Incumbent politicians would then have a strong incentive to reduce dimensions to one,
emphasizing that dimension on which they have previously won. Non-incumbents on the other hand, have a
strong incentive to introduce a second dimension in the hope of dividing previous winners (Riker, 1992). The
removal of race and ethnic issues from the public domain by incumbents may thus enhance legislative stability
(Ordeshook, 1992). Conversely, their introduction by non-incumbents may generate instability.
45
likelihood of permanently tyrannical majorities or minorities emerging. The next
section will evaluate the federal and bicameral systems proposed by the UN for
Cyprus in this light.
IMPLICATIONS FOR THE SET OF IDEAS
AND THE COMPREHENSIVE SETTLEMENT
Avoiding the permanent tyranny of the minority by the majority
One way to avoid the permanent tyranny of the minority by the majority and thus
enhance the viability of the polity is, to decentralize collective decision-making so as
to grant the minority the authority to decide on certain issues. One set of issues that
are likely to be relevant here are “non-divisible” or “non-tradable” ethnic ones such
as nationality, language, territorial homelands and culture (Rabushka and Shepsle,
1972; O’Leary and McGarry, 1995). A reading of paragraph 26 of the Set of ideas
shows that the federal government is not granted the power to decide on issues, like
education, culture, language and religion, over which preferences are, arguably, split
along ethnic lines. This is also the case for the Comprehensive Settlement and in
particular Article 13 of Draft Annex I. As a result, insofar as this power is vested to a
political authority it is done so at the level of the two federated or component states.
This reduces the capacity of the Greek Cypriot majority to tyrannize the Turkish
Cypriot minority even before the government begins its deliberations15
.
Another way to avoid the permanent tyranny of the minority is through
constitutional constraints on the centralized provision of services. One would expect
to find tighter constitutional constraints on the centralized provision of services over
which preferences may be divided along ethnic lines or, in other words, with respect
to which an ethnic group may expect to be a dissident minority (Congleton, Kyriacou
46
and Bacaria, 1998). Conversely, one would expect to find looser constitutional
constraints in the centralized provision of services over which preferences may not
be divided along ethnic lines, that is, with respect to which one expects to oscillate
between the majority and the minority coalition.
A look at those areas that would be attributed to the central government of a
reunified Cyprus under both the Set of ideas and the Comprehensive settlement
indicates that those over which one would a-priori expect a higher degree of inter-
ethnic consensus (for example, central banking, customs and coordination of
international trade, meteorology, airports and ports as concerns international matters,
federal postal and telecommunication services, patents and trademarks) are subject to
relatively fewer checks and balances namely, approval by simple majorities in both
Houses. Conversely, areas where the degree of inter-ethnic consensus may be more
limited (for example, foreign affairs, defense, security, budget, taxation, immigration
and citizenship) are subject to additional safeguards. Insofar as the Comprehensive
Settlement is concerned they may take the form of special majorities in the Senate. In
the case of the Set of ideas these may take the form of separate majorities in the
Lower House, Presidential and Vice-Presidential approval and Presidential and Vice-
presidential vetoes. Indeed, in the extreme case, to pass a proposal under the Set of
ideas requires separate ethnic majorities in the Lower House, another ethnic majority
in the Upper House and the exercise of an ethnic approval or veto power at the
executive level. In other words, the Set of ideas envisage the institutionalization of an
ethnically based multi-cameral system.
This obviously responds to the fears held by the Turkish Cypriot minority that
under majority rule for the whole population they may be potentially permanently
disaffected. Having said this, the Set of ideas seem to ignore the previously raised
point that issues over which preferences are, a-priori, divided across ethnic lines are
left to each ethnic community to decide separately. In addition, the fact that both the
15
By doing so, it also reduces the potential for cycling since it reduces the likelihood that representatives may
trade off issues that they care little about so as to influence those dimensions that are relevant to their ethnic
47
President and Vice-President can include items on the agenda of the Council of
Ministers provides some degree of protection against the exercise of agenda setting
power by the Greek Cypriot majority. Finally, the Set of ideas put the emphasis on
minority protection in apparent ignorance of those decision-making costs that are
inherent to the requirement that decisions be approved by numerous ethnically based
subsets of voters. These decision-making costs reflect the normal political bargaining
which takes place among individuals who must reach a single collective decision
(Buchanan and Tullock, 1962)16
. When these decision-making costs are factored in,
the whole set-up seems overly expensive. This is especially so if one moreover
considers, as Theophanous (2000a) does, the budgetary implications for a small
country such as Cyprus of maintaining four separate Parliaments; one in each
federated or component state and two Chambers at the federal or common state level.
The decision-making costs would be further increased, without any significant
improvement in the ability of the constitutional set up to safeguard the rights of the
Turkish Cypriot minority, by the Turkish Cypriot demand shortly after the Set of
ideas that the Council of Ministers be made up of an equal number of Greek and
Turkish Cypriots and that it operate on the basis of consensus. Alternatively, the
Greek Cypriot view that given the composition of the Upper House, separate
majorities are unnecessary in the Lower one, finds support from the perspective of
decision-making costs. In the strict context of decision-making costs, the
Comprehensive settlement represents an improvement over the Set of ideas since it
does not envisage the need for Presidential or Vice-Presidential approval for
decisions to be taken by the Presidential Council nor does it establish the right of
Presidential or Vice-Presidential vetoes.
groups something which would generate legislative instability (Ordeshook, 1992). 16
It is important to realize that they emerge whenever individuals take collective decisions in any area – ethnic
or other, – since individuals are likely to have different interests or different interpretations of the public good
over issues. This is also true for the members of the same ethnic group who are likely to have different
interpretations of what is ‘good’ for their group and so are faced with the need to reconcile these different
views giving rise to decision-making costs.
48
Although the Comprehensive settlement represents an improvement over the
Set of ideas in terms of decision-making costs it arguably may be less effective in
protecting the minority from the political tyranny of majority at the common state
level. To see this it is necessary to consider in more detail on what basis individuals
acquire political rights in the Comprehensive settlement. As explained above,
political rights at the common state level fundamentally spring from a person’s
internal component state citizenship status. But how is this citizenship status itself
acquired17
?
The Comprehensive settlement elaborates this in Attachment 3 “Constitutional
Law on internal component state citizenship status and component state residency
rights” in Draft Annex II of the Foundation Agreement. Article 1 of this Attachment
states, among other things, that upon entry into force of the Foundation Agreement
Cypriot citizens shall automatically be afforded the internal component state
citizenship status of the component state which at the time administers the territory
where they reside and that Cypriot citizens residing abroad shall be afforded the
internal component state citizenship status of that community (Greek or Turkish) to
which they or their forbearers belonged prior to 1974. The overall effect of these
articles is to afford the internal citizenship status of the Greek Cypriot component
state to members of the Greek Cypriot community and the internal citizenship status
of Turkish Cypriot component state to members of the Turkish Cypriot community.
But Article 2 of the Attachment goes on to say that any Cypriot citizen who
has been a resident in a component state for any seven consecutive years shall be
entitled to apply to change his or her internal component state citizenship status to
that of the component state where he or she resides. Thus in principle, if a person
with the internal component state citizenship status of the Greek (Turkish) Cypriot
component state chooses to reside in the Turkish (Greek) Cypriot component state
17
Political rights at the component state level may similarly depend on holding internal component state
citizenship status (Article 3 of Attachment 3 of Draft Annex II). This said, an individual who does not have this
status may enjoy political rights at this level if he or she lives in specified villages or if he or she is a member
of a religious or other minority (see for example, Article 10 of Draft Annex I of the Foundation Agreement).
49
and does so for seven consecutive years he or she can gain the internal component
state citizenship status of the Turkish (Greek) Cypriot component state and enjoy
political rights at the common (and component state) level as a result. Article 6 of the
attachment goes on to state that a component state may restrict the right to reside of
Cypriot citizens who do not hold its internal component state citizenship status to a
maximum of 28 per cent of its population after a transitional period of fifteen years
(given the demographic weight of each ethnic group, this ceiling is more likely to be
reached in the Turkish Cypriot component state due to returning Greek Cypriots).
Thus, in theory at least, fifteen years after the entry into force of the agreement 28 per
cent of the population of the Turkish Cypriot component state may be made up of
people who hold the internal citizenship status of the Greek Cypriot component state
and, again in theory, seven years later, this 28 per cent could acquire the internal
citizenship status of the other component state.
This of course has important implications for the capacity of the common state
institutions to protect the Turkish Cypriot minority from the political tyranny of the
Greek Cypriot majority. For example, it would mean that in the case of the
Parliament, a number of representatives from the Turkish Cypriot component state in
both the Chamber of Deputies and the Senate would be of Greek Cypriot extraction,
something which may upset the balance of power in either Chamber. At least
formally, representation in all other common state institutions is also possibly
affected. Finally, the adoption of internal citizenship status of the other component
state is likely to affect proportionality in both the public service and the police. This
problem would be exacerbated by the fact that upon acquiring the Turkish Cypriot
component state’s citizenship status, a returning Greek Cypriot would, arguably,
cease to be counted as part of the 28 per cent. This, together with the fact that the
total population of the Turkish Cypriot component state would necessarily be larger
would mean that the right of residency and by extension eventually internal
citizenship in the component state could be extended to an even greater number of
persons from the Greek Cypriot component state. In short then and notwithstanding
50
important practical barriers to the right of return of displaced persons, the
Comprehensive settlement may in the long run be less effective than the Set of ideas
in protecting the Turkish Cypriot minority from the political dominance of the Greek
Cypriot majority at the common state level since it abandons bicommunalism as a
source of political rights and adopts instead the more fluid concept of territorial-
based internal citizenship as the basis of these rights18
.
Avoiding the permanent tyranny of the majority by the minority
Consider now the capacity of the system to avoid the tyranny of the Greek Cypriot
majority by the Turkish Cypriot minority. This situation would emerge if the Turkish
Cypriot minority where to block the passing of legislation desired by the majority on
grounds other than the ethnically discriminatory nature of this legislation. For
18 In practice, the right of return may not be exercised for at least two reasons which spring directly from the
Comprehensive settlement. First, the Comprehensive settlement is silent on the need for inter-jurisdictional
agreements to facilitate the reciprocal provision of what one can call communal public goods such as
education, culture, language and religion. In the absence of such agreements a person who wants to consume
these public goods – at least during the first seven years of residency during which he or she has no political
rights since he or she does not enjoy the internal citizenship status of the other component state and assuming
that he or she does not live in specified villages or is not a member of a religious or other minority, – he or she
must do so in the area administered by his or her ethnic community and this represents a big obstacle to the
establishment of citizens across administrative boundaries. Although such inter-jurisdictional cooperation is
spoken of in the Comprehensive settlement (for example, Article 2 of the Foundation Agreement), it refers to
cooperation in the area of formulating and implementing policies related to the competencies in the areas of
foreign and EU affairs. This said, the freedom of movement would not necessarily be violated by the absence
of the said agreements. Indeed, one would expect to see individuals established in one area to travel to the
other area for employment and or recreational purposes. Second, the right of return may not be exercised given
the treatment received by the right of property in the Comprehensive settlement. Dispossessed owners of
property in the other component state will have their property reinstated subject to several conditions,
otherwise they will receive compensation (see, for example, Article 10 of the Foundation Agreement).
Moreover, in either component state, no more than 9 per cent and in any give municipality or village, no more
than 14 per cent of the total land area and of the number of residences shall be reinstated to persons hailing
from the other component state (Article 16 of Draft Annex VII of the Foundation Agreement). By limiting the
right of property, the Comprehensive settlement inevitably limits the freedom of establishment but it also limits
the freedom of movement and in particular the right of individuals to travel to the other area for recreational
purposes.
51
example, it may do so to obtain redistributive benefits for itself or to obtain
concessions on other unrelated issues.
Minority tyranny may emerge under the Set of ideas when the Turkish Cypriot
Vice-President either withdraws his/her approval of legislation or veto’s it or, when
in some specified areas a majority of Turkish Cypriot representatives vote as a
separate majority in the Lower House or, the Turkish Cypriot community votes as a
block in the Upper House19
. Under the Comprehensive settlement, minority tyranny
of the majority could emerge if the majority in the Senate does not include at least a
quarter of senators present and voting from the Turkish Cypriot component state or,
in the case of certain areas, if it does not include at least two fifths of sitting senators
from the Turkish Cypriot component state, or if in the Presidential Council the
majority does not include at least one member from the Turkish Cypriot component
state. At the outset one can state that the elimination of approval and veto powers at
the executive levels under the Comprehensive settlement reduces the capacity of the
Turkish Cypriot minority to tyrannize the Greek Cypriot majority.
Moreover, to the extent that the minority can tyrannize the majority by holding out
for the redistribution of federal or common state resources then it is important to
consider the redistributive opportunities at that level of government. Insofar as the
Set of ideas is concerned, these possibilities that are instituted, most notably, by
paragraph 86 of the Set of ideas that states,
“A priority objective of the federal republic will be the development of a
balanced economy that will benefit equally both federated states. A major
program of action will be established to correct the economic imbalance and
ensure economic equilibrium between the two communities through special
19
Assuming an equal number of representatives in the Lower and Upper Houses, the fact that only a majority
of Turkish Cypriot representatives would be required in the Lower House while all such representatives may be
required in the Upper House, means that it may be relatively more difficult to tyrannize the Greek Cypriot
majority in the Upper House compared to the Lower House.
52
measures to promote the development of the federated state administered by the
Turkish Cypriot community”.
Insofar as the Comprehensive settlement makes a reference to the economic
development of the northern part of Cyprus it is to recall that, in accordance with the
Presidency Conclusions of the Brussels European Council of 24 and 25 of October, a
program will be established by the Council for the disbursement of 206 million euros
between 2004 and 2005 for the economic development of the northern part of a
reunified Cyprus, in addition to the normal operation of the EU’s structural funds
(Paragraph ix, Appendix E: Requests to the EU with respect to the accession of
Cyprus to the EU). In this context, no comparable redistributive opportunities exist
for Turkish Cypriot from the common state level.
In attempting to redistribute resources to itself or obtain concessions on other
issues by blocking legislation, the Turkish Cypriot minority, like any minority, must
take into account the costs to itself of inaction, the higher these being the lower its
hold-out power and thus the likelihood that it push for such discriminatory
redistribution (Buchanan and Tullock, 1962). In this respect recall that paragraph 35
of the Set of ideas allows for the application of the most recent budget, adjusted for
inflation, in the event of a stalemate. Similarly, Article 1 of Attachment 8 “Law on
common state budget” in Draft Annex III of the Foundation Agreement, states that if
Parliament is unable to approve a budget before the beginning of the fiscal year, the
budget of the previous year adjust by inflation minus 1 per cent shall be carried on to
the next fiscal year, unless the Supreme Court in the exercise of its deadlock
resolving power decides otherwise. One effect of these provisions may be to lead the
Turkish Cypriot minority to discount the expected costs of a stalemate and thus
encourage it to hold out for redistributive gains.
On the other hand, the capacity to apply the most recent budget adjusted for
inflation reduces the ability of virulent minorities from either ethnic group who do
not support the federation, to threaten the viability of the state by freezing the
53
workings of government. The likelihood of this occurring is also reduced by the
institution of majority rule when taking decisions in the bicameral systems envisaged
by either proposal. Unlike more inclusive voting rules, majority rule makes it
difficult for virulent minorities within each ethnic group which may not support the
very concept of a reunified Cyprus, to throw a spanner in the workings of the federal
government. In this they may ironically count on the support of virulent nationalists
in the other ethnic group, who may similarly vote down legislation. The separate
ethnic majorities envisaged under the Set of ideas when voting in some areas and the
minimum required number of representatives from each component state required in
the Senate under the comprehensive settlement are also consistent with this logic.
A FUNCTIONAL AND BICOMMUNAL FEDERATION
Notwithstanding practical obstacles to the right of return being exercised by
displaced persons, I have argued that the bizonal and bicommunal federation
envisaged in the Set of ideas is likely to be more effective in minimizing the risk of
the permanent political tyranny of the Turkish Cypriot minority by the Greek Cypriot
majority than the bizonal system envisaged in the Comprehensive settlement. In this
section I will argue that a well designed bicommunal but functionalist-based federal
system is a better institutional arrangement than either of those proposed by the UN.
In a functional federation political units are defined by the public services they
provide and not necessarily by geographic boundaries or, in other words, they are
organized across functions instead of territories (Frey, 2001). The idea of defining
political units functionally rather than territorially has historical antecedents. The
previous author points to Poland where the organization of jurisdictions on a
functional basis in the past, he argues, contributed to managing potential ethnic and
religious conflict between Catholic, Protestant and Jewish Poles. Another historical
example is the scheme of “extraterritorial national autonomy” put forward in the
beginning of the century for the Austrian empire by Otto Bauer and Karl Renner
54
(Ferrero, 1995). The idea here was to divorce the development of cultural autonomy
from territorial autonomy or independent statehood. In particular, each nation would
be treated as a union of individuals whose names – if they chose voluntarily to be
identified as such, – would be entered into a national register. These individuals
would then be able to administer their cultural affairs in full autonomy, regardless of
their place of residence20
. One final example is, of course, the 1960 constitutional
arrangements for Cyprus itself whereby authority over religious, educational and
cultural affairs was vested in each ethnic group independently of territorial
considerations, not surprisingly, given Greek and Turkish Cypriots at the time lived
in mixed villages and towns all over the island21
.
A functional federation would be superior to a bizonal one basically because it
would allow the Turkish Cypriot community the political autonomy to organize those
areas which are particular to it but without violating the freedom of establishment or
the right to vote. The violation of either of these rights is inevitable in a bizonal
federation so as to avoid placing the Turkish Cypriot community in a numerical and
thus potentially, political minority in the Turkish Cypriot federated or component
state thereby potentially violating its political autonomy to organize the just
mentioned as well as other conceivable areas.
To see this consider that in a bizonal system, the full enjoyment of the freedom of
establishment could, at least in theory, lead to the establishment of Greek Cypriots in
the Turkish Cypriot federated or component state. Given the demographic realities of
the island, if they are then granted political rights at this level they could constitute a
political majority there. One way to avoid putting Turkish Cypriots in a political
minority without limiting the freedom of establishment is by granting Greek Cypriots
living in the north all citizenship rights (including the freedom of movement,
20
Bauer and Renner also referred to their proposal as federalism on the basis of the “personality principle” in
contrast to the usual “territorial principle” (Lijphart, 1977). 21
Dekleris (1981) identifies the functional nature of the Republic of Cyprus established in 1960 and points out
that the idea of functional autonomy for ethnic groups was adopted by the Ottoman Empire by way of the
millet system. Coakley (1994) suggests the legacy of this system may have played a role in enhancing the
55
settlement and ownership) except for the right to vote in that zone following the
regime of permanent residency status in the US (Hadjipavlou-Trigeorgis and
Trigeorgis, 1993). Doing so would preserve the freedom of establishment but at the
cost of sacrificing the right to vote22
.
This trade off between, on the one hand, the full enjoyment of the freedom of
establishment and on the other, the right to vote at the federated or component state
level could be possibly avoided in the context of a bizonal federation by reducing the
area to come under Turkish Cypriot administration so as to allow a majority of Greek
Cypriots to return home under Greek Cypriot administration (Theophanous, 2000a).
Doing so would reduce the likelihood that Turkish Cypriots would find themselves in
a numerical and thus political minority in the zone to be administered by them in the
event of the remaining Greek Cypriots returning to the north under Turkish Cypriot
administration, and would thus obviate the need to limit these peoples’ right to vote.
This said, some sort of formal upper limit to the number of Greek Cypriots
establishing themselves in the north – for example, that they can only make up a
maximum of 49 per cent of residents – would still be necessary in anticipation of
unforeseen developments in the medium to long-run.
Arguably, this goes a long way in explaining the Turkish Cypriot insistence that
“[t]he settlement of Greek Cypriots in the area that will be under Turkish Cypriot
control … shall be subject to a moratorium and the agreed ceiling in order to preserve
the bicommunal and bizonal character of the federal state” (United Nations, 1992).
More recently and most explicitly, the Comprehensive settlement envisages long
acceptability of the non-territorial approach adopted at the founding of the Republic (see this author for
numerous other examples of the “non-territorial” approach to the resolution of ethnic conflict). 22
This would potentially create a legal problem. According to Article 3 of Protocol 1 of the European
Convention for the Protection of Human Rights and Fundamental Freedoms which is to be an integral part of
the Constitution according to the Comprehensive settlement (Article 10 of Draft Annex I of the Foundation
Agreement), ‘The High Contracting Parties undertake to hold free elections at reasonable intervals by secret
ballot, under conditions that will ensure the free expression of the people in the choice of the legislature’. The
European Court of Human Rights has recognized that constitutional arrangements in the Contracting States
may make the right to vote and to stand for elections subject to various conditions but adds that while there is a
wide margin of appreciation, it is for the Court “to satisfy itself that the conditions do not curtail the rights in
question to such an extent as to impair their very essence and deprive them of their effectiveness” (see,
Merrills, 1993, for a discussion of these issues).
56
term limitations to the freedom of establishment to the extent that a maximum of 28
per cent of the population of the relevant component state can hail from the other
component state, albeit with a proviso that such limitations will be reviewed no later
than 25 year after the reunification of the island.
Rather than a bizonal federation, the functional one I advocate would by
definition avoid formal restrictions to resettlement or voting rights while at the same
time allow the provision of communal public goods across Cyprus. It is important to
emphasize that while a functional federation is incompatible with the bizonal side of
UN proposals, it is not incompatible with the bicommunal side included in the Set of
ideas. One could adopt a bicommunal federation where at the same time political
jurisdictions are defined over functions and not territories. Indeed, as I have
previously said this was the case for the Republic of Cyprus as established in 1960.
As it was the case then, each ethnic community could organize the provision of
public goods constitutionally assigned to the community level and offer these to its
members across Cyprus, but unlike the 1960 arrangement, now both communities
could decide the provision of public goods at the federal level by way of a well-
designed bicameral legislature. To avoid the additional cost to the public purse of
maintaining four separate Parliaments, members of the component state legislatures
could designate a number among themselves to the common state Chamber of
Deputies. The overall division of powers between the federal, communal and local
levels could be enforced by a federal constitutional court and the evolution of this
division could be determined by a bicommunal upper house or Senate. This would
offer the Turkish Cypriot minority a strong institutional guarantee against majority
tyranny.
QUALIFICATIONS
Before closing here it is necessary to point out that the functional and bicommunal
federation proposed is not without its problems. Insofar as each community must
57
finance its expenditure by levying taxes on its own tax base the possibility emerges
that the poorer ethnic group may be unable to provide public goods or services that
are specific to it and that it attaches a high value upon. Faced with this situation –
which recall from chapter 2 emerged in Cyprus in the early 1960s, – it may be
reasonable to search for a consensus on a minimum level for such public goods and
services for all ethnic groups, to be financed by some federal redistributive scheme.
While on the spending side, such a redistributive scheme could consist of
lump-sum transfers towards the “poorer” community, it should ideally be financed by
wealthier individuals regardless of their ethnic group. This would increase the
expected cost for any ethnic group of redistributive activities – since it would have to
bear part of the cost of financing these. It would moreover, avoid setting up a system
of “structural redistribution” from relatively wealthy ethnic groups to poorer ones,
something which, over time, may both engrain ethnic awareness and lead to feeling
of resentment from wealthier ethnic groups to the detriment of inter-ethnic co-
operation (Ferrero, 1995; Findlay, 1995)23
.
Another problem is related to the provision of local public goods and to the
organization of local administration in general. This emerged as an important issue
for the Turkish Cypriot community in the inter-communal negotiations in the period
prior to the Turkish invasion (see, Dekleris, 1981). In particular, the Turkish Cypriots
wanted the same control over local public goods as they enjoyed for communal ones.
The Greek Cypriots on the other hand, resisted this since they saw it as a step
towards the partition of the island.
23
This idea stems from the more general point that insofar as formal institutions point self interest and
ethnocentrism in the same direction this will tend to reinforce the latter over time to the detriment of inter-
ethnic cooperation (I explore this fully in Kyriacou, 2002). This applies to the just mentioned case of
“structural redistribution” but it also applies to “proportionality rules” requiring that each ethnic community be
proportionally represented in the civil service. In a more historical context, it has been argued that by granting
rights to groups rather than to individuals, the institutions of feudalism, the Indian caste and the Ottoman millet
systems make members of the group dependent on it for their life chances and as a result increase group
solidarity (Hechter, 1987). Laws that limit the individual’s alternatives outside group boundaries promote
dependence and those that provide new alternatives lessen it. The relevant point here is that relative income
and merit or achievement should be, respectively, the criteria used to finance a minimum level of communal
public goods as well as decide employment in the civil service.
58
The main responsibilities of municipalities in Cyprus are the construction,
maintenance and lighting of streets, the collection, disposal and treatment of waste,
the protection and improvement of the environment and the good appearance of the
municipal areas, the construction, development and maintenance of municipal
gardens and parks and the protection of public health. The Municipal Council has the
authority to promote, depending on its finances, a vast range of activities and events
including the arts, education, sport and social services. Municipalities also have
powers in the areas of streets and buildings regulation, town planning, civil marriages
and sewerage systems. The main sources of revenue are municipal taxes, fees and
duties (professional tax, immovable property tax, hotel accommodation tax, fees for
issuing permits and licenses, fees for refuse collection, fines, etc.), as well as state
subsidies. Taxes, duties and fees represent the major source of revenue while state
grants and subsidies amount to only a small percentage of the income. The central
government, however, usually finances major infrastructure projects undertaken by
the municipalities, but this is dependent very much on each individual project.
At the outset, it is obvious that there is some scope for assigning to each ethnic
community those local government areas which may be particular to it, for example,
arts and education. Putting aside the technical feasibility of the parallel provision of
some local public goods and services by both ethnic communities, the allocation
criterion should be whether the two communities can be reasonably said to be
divided along ethnic lines over such goods. This criterion is arguably not met for the
majority of local services listed above and therefore they should not be
communalized.
To the extent that the two communities can cooperate for the common
provision of local public goods and services this would, surely, have a very positive
effect on inter-ethnic relations24
. Moreover, avoiding the communalization of non-
24
That such co-operation can emerge is obvious from the fact that one of the few areas where the two ethnic
communities have cooperated despite their physical separation is in bicommunal projects in the island’s
divided capital such as the Nicosia sewerage scheme, Nicosia Master Plan, electricity and water projects. The
fact that these projects have been funded from the financial protocols concluded with the EU points to the
59
communal local public goods and services could help mitigate the important problem
of financing local services. By way of illustration, if all local services were
communalized, the limited tax-base of the Turkish Cypriot community would point
to the need of some federal level redistributive scheme which, ultimately, would
mean redistributing wealth from the Greek Cypriot community to the Turkish
Cypriot one. While this may be possible to justify for the maintenance of a minimum
level of strictly communal public services, it may be much more difficult to do so if it
were extended to local public services in general something which could lead to a
feeling of resentment from the Greek Cypriot community. If instead local goods and
services are not communalized then most of their revenue could continue to be raised
locally via taxes which are not ethnically based and are thus less likely to consolidate
ethnic awareness and generate resentment25
.
In sum, efficiency rather than ethnicity should be the overriding criterion in
the provision of non-ethnic local public goods and services. The argument against
the communalization of local public goods would be strengthened in the presence of
additional guarantees for the non-discriminatory provision of such goods via, for
example, a degree of bicommunal representation at the local level as well as
constitutional and or other legal restrictions against the discriminatory treatment of
the members of any ethnic group in areas other than communal ones.
One final problem concerns the bicommunal nature of my proposed system
and the communal basis for political representation that this implies. Bicommunalism
has very strong roots in Cyprus extending back at least to the time when Cyprus was
under Ottoman rule. Any degree of representation in the political or public sphere has
usefulness of budgetary incentives to promote inter-ethnic cooperation. This is recognized by the
Comprehensive settlement which, in a different context to the one discussed here, states that the common state
shall spend no less than 5 per cent of revenue from indirect taxation which is not transferred to the EU to
finance cooperative endeavors between the component states or between municipalities located in different
component states (Article 1 of Attachment 7 “Law on common state taxation and finances” in Draft Annex III
of the Foundation Agreement). 25 Financing local services from local rather than federal taxes is moreover in tune with several well-accepted
normative criteria coming from the literature on fiscal federalism. In particular, I am referring here to the
principles of ‘fiscal equivalence’ (Olson, 1969) or the ‘correspondence principle’ (Oates, 1972), that basically
call for a match between those who receive the benefits of a collective good and those who pay.
60
always been based on ethnicity. At independence, bicommunalism was adopted in
the context of a consociational system with the main aim of guaranteeing group
representation and thereby avoiding the political tyranny of the Turkish Cypriot
community by the Greek Cypriot majority. It is because of the traditional importance
which is placed on bicommunalism by the Turkish Cypriot community and the
previously alluded to problems which emerge when one abandons it in favor of
bizonal solution, that my proposal includes this feature.
This said, a strict communal basis for representation has at least two
disadvantages which must be taken into account. One disadvantage is, simply, that it
is impossible to vote for moderate political representatives outside one’s ethnic group
who may campaign on a supra-ethnic platform or who (especially at the local level)
may put efficient public administration above ethnicity. Of course, such politicians
may emerge within each community but their electoral chances would, arguably, be
improved if they could seek votes from like-minded citizens from all ethnic groups.
Another disadvantage is that since each political representative’s constituency is
limited to members of his or her own ethnic group and a large part of politics is about
redistributive issues, this opens up the real possibility that as politicians vie for
redistributive gains for their constituency in the normal course of competitive
electoral politics this may take the form of ethnically discriminatory and inherently
divisive policy proposals. In short, a strict bicommunal system is more likely than not
to strengthen group boundaries and, ultimately, undermine inter-ethnic co-operation.
Having said this I recognize the possibility that by guaranteeing each ethnic group a
minimum degree of representation, communalism may reduce the incentive of
political representatives to play the ethnic card to gain office (Koralka, 1993). As
such it may contribute towards diffusing ethnicity during elections.
The question that emerges is whether the electoral system can be engineered
so that it can both maintain the benefits of bicommunal representation while at the
same time being more open-ended with regards to the possible emergence of inter-
ethnic politics. One-way of doing so is through a system of “cross-voting” whereby
61
electors could vote not only their communal candidates but for candidates standing
on non-communal tickets as well. Other systems include “vote-pooling” and
“preference swapping” at the core of which is to make politicians reciprocally
dependent on the votes of members of groups other than their own (see Reilly and
Reynolds (1999) for an extended discussion of these and other electoral rules which
could be suitable for divided societies).
62
CHAPTER 4.
A VIABLE SOLUTION TO THE CYPRUS PROBLEM:
IN SEARCH OF INSTITUTIONAL VIABILITY
INTRODUCTION
The attainment of a viable solution to the Cyprus Problem has been the declared
objective of many of those engaged with the problem over the years including the
government of the Republic of Cyprus, foreign governments and international
organizations. In the previous chapter I have argued that the viability of a reunified
Cyprus depends on the capacity of institutional mechanisms to minimize the
likelihood of the political tyranny of the minority (majority) by the majority
(minority). In this chapter I will go beyond this to examine other conceivable factors
which may affect the viability of a reunified Cyprus26
. To do so I rely on the
theoretical literature dealing with the issue of institutional viability or maintenance.
A reading of this literature has brought to light at least four factors which may
determine the viability of any solution to the conflict namely:
(i) the relative strength of each community in the non co-operative setting;
(ii) the perceived fairness of the co-operative solution;
(iii) the influence of informal rules and finally;
(iv) the judicial enforcement and legislative maintenance of the terms of co-
operation.
Each of these variables has important implications for the nature of the solution to
the problem and will be discussed both in the historical context of the dispute and
63
mainly by reference to both the Set of ideas and the Comprehensive settlement.
Before turning to these factors I will analyze the status quo situation on the island
from the vantage point of, first, the classical prisoner’s dilemma (PD) game and,
then, a divided PD-game which I will argue better describes the current stand-off
facing the two communities.
THE SOCIAL DILEMMA
A Classical Prisoner’s Dilemma
Consider first one type of dilemma currently facing the Greek and Turkish Cypriot
communities on the island. My use of the word dilemma is deliberate since we will
draw from the literature dealing with the social dilemma facing two individuals
(Bush, 1972; Tullock, 1974; and especially Buchanan, 1975). Figure 1 below
represents the standard PD-game where ti>ri>pi>si for each player i=A and B.
Figure 1. From the status quo to a reunified Cyprus
B
Turkish Cypriot community
A
Greek Cypriot
community
Cooperate Defect
Cooperate
I
(rA, rB)
II
(sA, tB)
Defect
III
(tA, sB)
IV
(pA, pB)
26
This chapter draws on Kyriacou (2000b) but adds several new insights as well as incorporating relevant
implications which emerge from the Comprehensive settlement. See Kyriacou (2001) for a discussion of the
64
In this simple model, the two ethnic communities are faced with two options namely,
the possibility to ‘cooperate’ entailing an acceptance of a solution to the Cyprus
Problem and thus the reunification of the island, and ‘defect’ which entails no such
acceptance and the real possibility of a Hobbesian state of war. The structure of the
model represents the idea that both ethnic communities would be better off
cooperating in a reunified Cyprus rather than arming themselves to the teeth in a
divided one. The movement from a situation of a volatile military stand-off (cell IV)
to one where both ethnic communities cooperate on a reunified island (cell I) reflects
various factors including the enjoyment of a peace dividend (especially for the Greek
Cypriot community) and economic benefits for each community (especially the
Turkish Cypriot one)27
. However, the social dilemma emerges since either ethnic
group has a unilateral incentive to defect, which in the extreme could take the form of
an aggressive and unilateral military action. As a result, the danger exists that the
mutual co-operation outcome and the resultant higher payoffs will be unsustainable
as both ethnic communities cheat thereby moving society to cell IV.
The discussion so far is descriptive of a status quo situation which is
characterized by a high degree of tension and the real possibility of inter-communal
conflict including the possibility that it be generalized into a Greek-Turkish war
within the context of the wider Greco-Turkish feud which apart from Cyprus extends
to disputes in the Aegean Sea concerning territorial waters, airspace, and continental
shelf jurisdiction. Having said this, I will now examine the implications of reducing
the shadow cast on the whole analysis by the threat of anarchy. I will do so because
this is more descriptive of the status quo situation on the island, which is generally
peaceful with conflict limited to international political forums.
ideas developed here in the context of potentially divided multi-ethnic states in general. 27
Defence spending by Greek Cypriots corresponds to approximately 10 per cent of GDP while the figure is
around 2.2 per cent for Turkish Cypriots (the actual figures are not made public). Turkey maintains between 30
and 35 thousand soldiers in the north. The Greek Cypriots enjoy a GDP per head that is more than 3 times
greater than that of the Turkish Cypriots.
65
A Divided Prisoner’s Dilemma
Thus, instead of assuming that non co-operation between Greek and Turkish
Cypriots potentially faces them with a Hobbesian world, consider now the situation
where they are confronted by a limited threat of anarchy. One implication is that
faced with a limited threat of anarchy the two communities would be more reluctant
to enter into a co-operative agreement than if they were faced with such a threat in
full.
This modifies the previous PD-game as illustrated in figure 2 below (where
ti>ri>qi>pi>si for i=A, B). This Figure corresponds to a divisible prisoner’s dilemma
where the common interest in order (co-operation) now co-exists with conflicting
interests about which order will prevail (Heckathorn and Maser, 1987).
Figure 2. From the status quo to a federal or confederal Republic of Cyprus
B
Turkish Cypriot community
A
Greek
Cypriot
community
Cooperate 1 Cooperate 2 Defect
Cooperate 1
I
(rA, qB)
II
(pA, pB)
III
(sA, tB)
Cooperate 2
IV
(pA, pB )
V
(qA, rB)
VI
(sA, tB)
Defect
VII
(tA, sB)
VIII
(tA, sB)
IX
(pA, pB )
66
Thus, rather than faced with a dichotomous decision between anarchy and order, the
two communities are now faced with the choice of limited anarchy (cell IX) and two
conflicting perceptions of order or, in terms of my discussion, co-operation under
two conflicting sets of terms. While the Greek Cypriot community may prefer to
cooperate under terms 1 (cell I), the Turkish Cypriot community may prefer to do so
under the terms 2 (cell V).
In particular, recall that the Greek Cypriots prefer a strong federal
arrangement with fewer checks and balances, the unrestricted enjoyment of the
freedom of movement and settlement and the right of property in the long run, 20 to
25 per cent of the land under Turkish Cypriot administration and the complete
demilitarization of the island with a security guarantee provided by the international
community. Alternatively, the Turkish Cypriots prefer a confederal arrangement
with numerous checks and balances, a permanently limited enjoyment of the
freedom of settlement and the right of property, 29+ to 37 per cent of the island
under Turkish Cypriot administration and, finally, a continued Turkish troop
presence on the island and a legal right of unilateral intervention by Turkish armed
forces.
Agreement requires concessions by each party since otherwise, either may
refuse to cooperate “because (it) judges the constitution to be unfair, to require
excessive concessions.” (Heckathorn and Maser, 1987: 154). However, it is possible
that a community may also refuse to cooperate and holdout for the adoption of rules
that discriminate in its favor. The extent to which such rules are adopted is a function
of the holdout power of the two communities28
. Arguably, the holdout power of the
Greek Cypriot community has traditionally been weaker than the Turkish Cypriot
one for two reasons. First, as time goes by, the Turkish Cypriot leadership’s
28
A similar point has been made by (Schmidt-Trenz, 1989) who argues that the agreement which is eventually
reached depends on the location of the status quo, the more favorable this being to one of the parties, the more
likely that the agreement reached is similarly favorable. Thus, the parties involved have an interest to change
the status quo in their favor, prior to beginning negotiations for a final settlement.
67
“turkification” policy – Turkish settlers, name changes and the like (see, Ioannides,
1991) – increasingly alters the demographic and cultural variables in the north
making it ever more difficult that a mutually acceptable solution to the problem will
be found. Indeed, to the extent that this policy leads to ever more people with
relatively intense ethnic preferences, then this obviously makes it increasingly
difficult to reunify the island under any institutional arrangement. Second, in the
long run the “TRNC” may be offered international recognition as indicated, for
example by the fact that over the years and apart from Turkey, at least nine Islamic
nations have either voted against, or abstained from, UN resolutions which give
international recognition to the government of the Republic of Cyprus. Turkey seems
willing to continue occupying the island with its troops, “judging that over time the
division will come to be acknowledged, if not recognized, by the international
community and the validity of the Greek-Cypriots’ claim to represent the whole
island will be eroded.” (McDonald, 1989: 31).
This said, the eventual accession of Cyprus to the EU in May of 2004 would
significantly strengthen the negotiating position of the Greek Cypriot side for at least
three reasons. First, in view of the EU membership aspirations of Turkey, it will
allow the Greek Cypriots for perhaps the first time in the history of the conflict to
directly apply pressure on the Turkish government to mitigate its wholehearted
support for the positions taken by the Turkish Cypriot leadership thereby
undermining its negotiating strength. Second, EU membership is likely to increase
the sense of material and social well-being of the Greek Cypriot community while
the continuing isolation of the Turkish Cypriot community is likely to lead to the
reverse. This is likely to raise the social pressures in the north, something which
inevitably will reduce the negotiating strength of the Turkish Cypriot leadership.
Third, as a full member of the EU Cyprus would be in a better position to holdout for
a solution which does not derogate from the EU’s founding principles – a solution
closer to its ideal point (see more on this in chapter 5).
68
Thus, through time, the relative position of the Greek Cypriot side has
arguably weakened and as a result it may have been expected to make increasing
concessions in the search for a settlement. Conversely, the Turkish Cypriot side
would have been expected to make increasing demands, which has been the case as
indicated for example, by its relatively recent demands for the creation of a
confederal rather than a federal Cyprus which had previously been its objective. This
trend however, may be halted or even reversed in the post-EU accession period for
the reasons just outlined.
Figure 3. The effects of time on bargaining for a solution
Figure 3 above represents, in utility space, the divided prisoner’s dilemma shown in
figure 2. Again, 1 and 2 represent the preferred terms of settlement of the Greek and
Turkish Cypriot Communities respectively. The effect of time can be envisaged as a
movement along the contract curve from 1 to 2 up until the time of EU accession and
a movement in the opposite direction afterwards. Its worth pointing out that as
Greek Cypriot
Utility
Turkish
Cypriot
Utility
0
2
1
Status Quo 3
4
D
A
C
B
69
drawn, points 1 and 2 indicate that it would be in the interest to both the Greek
Cypriot and the Turkish Cypriot side to accept a solution even if it corresponds to the
ideal point of the other side. This can be seen by the fact that these opposite ideal
points represent points of greater utility than that received in the status quo situation
of limited anarchy. Thus, the Greek Cypriot side should prefer a solution at the ideal
point of the Turkish Cypriot side compared to the status quo since it would receive
0B rather than 0A and the Turkish Cypriot side should prefer a solution at the ideal
point of the Greek Cypriot side compared to the status quo since it would receive 0D
rather than 0C.
Had the ideal points for the Greek Cypriot and Turkish Cypriot sides been
drawn at 3 and 4 respectively, then either side would be indifferent between a
solution at the ideal point of the other side and the status quo. Finally, drawing the
ideal points to the right of 3 (along the contract curve) in the case of the Greek
Cypriot side and to the left of 4 (again on the curve) in the case of the Turkish
Cypriot side would mean that each side would prefer the status quo to a solution at
the ideal point of the other side. The final result depends on the degree of
complementarity between the terms of cooperation envisaged (measured by the
distance between the different ideal points) and the benefits of cooperation relative to
the benefits of the status quo position (measured by the distance of the contract curve
from the status quo). The smaller the degree of complementarity between the terms
of cooperation envisaged by each side and the smaller the expected benefits from
cooperation then the more likely that the status quo position is preferred. The
opposite is true when both the degree of complementarity between the terms of
cooperation and the expected benefits of cooperation are high.
The possibility should also be admitted that even if the shadow cast by the
threat of anarchy may be initially short, it may lengthen over time as the two
communities engaged in co-operation become increasingly interdependent
(Holcombe, 1980). Increasing interdependence makes each individual more
vulnerable if co-operation breaks up (moves the status quo closer to the origin).
70
Consequently, even if we start off from a situation of limited anarchy, the classical
prisoner’s dilemma representation of the social dilemma facing the two communities
may become increasingly relevant as interdependence increases through time. The
possibility that the break down of a reunified Republic may lead to huge losses
relative to those incurred under the actual status quo situation must be in the minds of
Turkish Cypriots (Tsaggaras, 1995). This is related to the issue of security guarantees
which I will address in the next section.
In the context of the social dilemma, whether in the form of a classical
prisoner’s dilemma or of a divided one, four factors can been identified to exert an
influence on the sustainability of the cooperative outcome through time. In particular,
I will argue that the viability of co-operation is affected by, the relative strength of
each community in the non-cooperative setting, the perceived fairness of the
cooperative solution, the influence of informal rules and finally, the judicial
enforcement and legislative maintenance of the terms of co-operation. As stated in
the introduction to this chapter, each of these factors has important implications for
the nature of the solution to the problem and will be discussed within the general
context of both the Set of ideas, the Comprehensive settlement and some of the most
important historical events which make up the conflict.
THE RELATIVE CAPACITY TO IMPOSE COSTS IN THE
NON CO-OPERATIVE SETTING
The viability of inter-ethnic co-operation (the co-operative setting) is enhanced given
one ethnic group fears the costs which the other group may impose upon it in the
event of a breakdown of such co-operation (the non co-operative setting). Costs may
emerge when ethnic groups respond to non co-operative behavior by other groups by
either defecting themselves (reciprocity) or breaking off interactions completely
(exit).
71
Costs from Reciprocity
In a simple two-person interaction over time, each rational person will adhere to the
initial terms of co-operation since, “Each person will recognize that unilateral
defection cannot succeed and that any attempt to accomplish this would plunge the
system back into a position that is less desirable for everyone than that which is
attained upon adherence to contract.” (Buchanan, 1975: 65). Thus, the possibility of
reciprocal reactions by one ethnic group to non co-operative behavior by the other
may enhance the viability of co-operation. An ethnic group that defects may expect
to be punished by likewise behavior by the other group and as a result may refrain
from doing so. The effectiveness of reciprocity as a mechanism which may promote
inter-ethnic cooperation is increased if each group holds all members of the other
group viable for the actions of non-cooperating individual members. If this is so, then
the non-cooperative acts by members of one ethnic group may provoke a spiral of
violence which quickly expands beyond the initial parties and the fear of this induces
inter-ethnic cooperation (Fearon and Laitin, 1996).
Insofar as the Cyprus Problem is concerned, the disciplining effects of
reciprocity are related to the issue of security guarantees. Recall that the Turkish
Cypriots call for a continued Turkish troop presence on the island and a legal right of
unilateral intervention by Turkish armed forces. By and large, this reflects a feeling
of insecurity of the Turkish Cypriot minority, a feeling which is intensified in light of
the violent inter-ethnic conflict of the 1960s (Loizos, 1995) and in particular, the
inability of a multinational UN force to protect Turkish Cypriots during this period
(Güven-Lisaniler and Warner, 1998). The Turkish Cypriots put a premium on the
security considerations relative to the economic benefits that would flow from
reunification. In line with the logic of reciprocity, it has been argued that non co-
operative behavior may be avoided given the threat of unilateral military intervention
by adjacent states (Niskanen, 1990). The problem with this reasoning is that it
72
assumes that the mechanism of reciprocal punishment by the “mother country” in the
case of non co-operative behavior is perfect. There are several reasons that cast doubt
on this assumption.
First, the threat of reciprocity can make the co-operative solution self-
enforcing insofar as it generates a set of stable and self-generating expectations,
which are common knowledge (Ordeshook, 1992) or assuming that no accidents,
mistakes or misinterpretations take place (Fearon and Laitin, 1996). Arguably, at
least the former condition was not met in the case in Cyprus in the pre-invasion
period. The Greek Junta which staged the coup in Cyprus in July 1974 assumed that
the U.S and NATO would not allow Turkey to invade Cyprus, despite the fact that
the Turkish Prime-minister of the time presided over a fragile coalition and the
likelihood that the Turkish General Staff felt humiliated by previous stand-downs and
wanted to get its way (McDonald, 1989).
Second, the sustainability enhancing capacity of a threat of unilateral
intervention in response to non co-operative behavior by one ethnic group may be
compromised by the very existence of such expectations or in other words by the
credibility of the threat. This would be the case in the presence of extremist
individuals in either ethnic group. Armed with the expectation of likely reciprocal
reactions to non co-operative behavior on their part, such individuals may choose to
defect (through relatively cheap terrorist acts) so as to provoke a widening spiral of
violence, the intervention of one or both of the mother countries and ultimately as a
result, the breakdown of co-operation.
Third, the ability of this mechanism to enhance co-operation between the two
groups may be distorted by the wider interests of one or both the “mother countries”.
In this vein consider that beyond its natural interest to protect the Turkish Cypriot
minority on the island, Turkey had the strategic interests of neutralizing the threat of
a predominantly Greek island so close to its shores and obtaining added leverage in
the context of the Greek-Turkish disputes in the Aegean (Papasotiriou, 1998). Its
73
continuing occupation of the north serves these interests but at the cost of efforts to
reunify the island over the years.
A final and related rational for why the reciprocity mechanism may be
imperfect concerns the possible incentive on the part of political representatives to
mobilize ethnic loyalty so as to gain office (Roback, 1989). This could be the case
also for politicians in the “mother country” who may manipulate the presence of
their troops and the right of unilateral intervention to shore up domestic support at
home. This dynamic arguably emerged during the 1974 Turkish invasion which gave
a fillip to a Turkish government threatened by a loss of coalition support (McDonald,
1989).
The possible failure of the reciprocity mechanism tends to lend support to calls
by the Greek Cypriot side for the complete demilitarization of the island as well as its
refusal of a continuing right of unilateral intervention by the mother countries. The
question is whether this provides support for their calls for the provision of a security
guarantee provided by the international community. Compared to a right of unilateral
intervention, the use of force under regional security arrangements must be a result of
decisions that are made by political processes involving checks and balances
increasing the likelihood that the outcome will reflect considered judgment and broad
consensus (Ehrlich, 1974).
Arguably however, the real danger exists that the particular and divergent
interests of the members to the regional security arrangements, may distort their
effectiveness much in the same way that the particular interests of the mother
countries may distort the effectiveness of a right to unilateral intervention. This
possibility must play a big part in the Turkish Cypriot refusal to accept such
guarantees. It points to the need to set up such guarantees made up of processes
which minimize the capability of any one member to manipulate them for partisan
interests. One way of doing this is by endowing an international security force with a
clear mandate to respond decisively (credibly) to violent non co-operative behavior
74
by either ethnic group, subject to the decision of a simple majority of those who are
members to the arrangement.
Both the Set of ideas and the Comprehensive settlement speak of the
demilitarization of a reunified Cyprus although total demilitarization is contemplated
in the latter proposal (for example, Article 8 of the Foundation Agreement) while it
remains an objective in the former one (paragraph 52). Both proposals also enshrine
the continuing application of the Treaties of Alliance and Guarantee in the context of
a solution. In the case of the Treaty of Alliance, the Comprehensive settlement is
more precise speaking of the stationing of Greek and Turkish contingents each not
exceeding a number between 2,500 and 7,500 members. The application of the
Treaty of Guarantee implies the continuing right of unilateral intervention would still
be possible ‘with the sole aim of re-establishing the state of affairs …’ as was the
case when the Republic of Cyprus was founded. However there is a difference
between the two proposals in that only the Comprehensive settlement explicitly
foresees the presence of a UN peacekeeping operation to monitor implementation, to
remain as long as the government of the common state with the concurrence of both
component states does not decide otherwise (Article 8 of the Foundation Agreement).
Arguably this peace keeping force would have first go in restoring the ‘state of
affairs’ agreed to.
Thus, the proposal seems to partly satisfy both Greek and Turkish Cypriot
demands by both allowing the mother powers to intervene unilaterally but only if the
UN peacekeeping operation is unable to enforce compliance with what was agreed
on. This said, the proposal is silent on the decision-making mechanisms under which
the UN force might respond to violent non co-operative behavior by either ethnic
group. To the extent that these mechanisms are such that the credibility of the force is
compromised then this increases the likelihood of unilateral intervention if inter-
ethnic cooperation breaks down.
75
Costs from Exit
Rather then respond to defection by doing likewise, a cheated ethnic group may
instead choose to withdraw completely from interactions with the cheating group and
to seek to establish interactions with other groups. The possibility of completely
withdrawing from interactions with the other ethnic group in the post-solution or
post-constitutional period, increases the cost of non co-operative behavior since “If
you choose the non-cooperative solution, you may find that you have no one to
cooperate with.” (Tullock, 1985: 1081). The threat of secession by a disaffected
minority is a factor promoting constitutional maintenance (Niskanen, 1990).
However, while the availability of exit may make constitutions “self-enforcing”, it
may also reduce the credibility of the commitment to the contract agreed to
(Lowenberg and Yu, 1992). This is especially so within the context of multi-ethnic
states for at least three reasons.
First, recall that the expectation of likely reciprocal reactions to non co-
operative behavior may provide an incentive for extremist members of an ethnic
group to defect through acts of terrorism and thus bring co-operation between ethnic
groups to an end. In the context of an exit option, if now these extremist groups are
also separatists, they may ultimately do so to precipitate a complete break in
interactions between “their” group and the “other” or, in other words, to provoke the
eventual exercise by their group of an exit option.
Second, an exit option may be manipulated by political representatives in the
pursuit of electoral success. Given electoral competition, the availability of a viable
exit option may inevitably lead to calls for it to be exercised. The democratic
institutions of potentially divided multi-ethnic states may have an in-built bias
towards secession. The likelihood that politicians being successful in their efforts
depends on the viability of the exit option, this being increasingly likely if they can
secure the economic association of their ethnic group within a larger trading network
76
such as a regional or international trade regime (Meadwell, 1993; Hardin, 1995;
Hechter, 2000).
Third, a group can strategically employ a right of exit as a way of
renegotiating the terms of co-operation and in particular the distribution of costs and
benefits, in its favor (Sunstein, 1991; Mueller, 1996). Again, this is more likely the
more viable or credible is the threat of exit. The availability of a credible exit option
is not, in itself, inimical to the viability of co-operation. Indeed, insofar as the
original terms of co-operation were biased in favor of one of the parties it may
positively effect the viability of co-operation by enhancing the perceived legitimacy
of the terms of co-operation. On the other hand, if the original terms of co-operation
where perceived to be fair by all parties to the agreement, their alteration via the
strategic use of an exit option by one of the parties may reduce this perception and
consequently have a negative effect on the viability of co-operation.
THE PERCEIVED FAIRNESS OF THE TERMS OF CO-OPERATION
The viability of co-operation may be seen to be affected by the perceived fairness of
the terms of co-operation. Beyond the disciplining effects of reciprocity, the higher
the perceived fairness of an agreement the less likely people are to defect from it
once set up and so the lower the costs of maintaining or enforcing it (North, 1981).
Indeed, the more unfair or unjust an individual’s perception of the system, the higher
the private cost he/she is likely to incur in attempting to change it. With this in mind I
can point to two general factors and four specific ones which may affect individuals’
perceptions of fairness and thus, their willingness to comply with the system. The
two general factors are the degree of voluntariness when entering into the co-
operative agreement and the ideologies of the individuals involved while the four
specific factors are related to changes in property rights, relative prices, relative
incomes and information.
77
The Degree of Voluntariness
Individual perceptions of fairness may be affected by the extent to which the terms of
co-operation were entered into voluntarily, or in other words, in the absence of
coercion. Insofar as an individual considers any agreement which is coercively
imposed to be unfair he/she would be less likely to comply with its provisions. This
concept of fairness is in step with the Lockean vision that considers illegitimate any
non-consensual crossing of “natural boundaries” to individual rights that are assumed
to be definitive and well understood.
A Constitution which is voluntarily agreed upon by all the parties involved
and which moreover is so openly and explicitly, will induce greater compliance
because “[k]eeping promises is dictated undoubtedly by all moral codes …”
(Mueller, 1996: 69). Overt agreement to the Constitution enhances compliance with
its provisions and enhances both it effectiveness and its durability. More generally,
“promise keeping” may be seen in terms of an external ethical constraint which may
limit defections from the co-operative agreement even in large groups (Buchanan,
1975).
Insofar as a general relationship between voluntary agreement and compliance
is concerned, it is instructive to consider the 1960 Agreements which gave birth to
the Republic of Cyprus and which failed shortly afterwards. The Greek and Turkish
Cypriot representatives had no negotiating role in the Zurich conference where the
basic structure of the accords was established (Ehrlich, 1974). They were present at
the London conference were the details where worked out but, they had not been
elected to this position. Moreover, the negotiators were offered a take it or leave it
choice. It is indicative that the 1960 Constitution does not include any statement that
the people are the source of (constitutional or state) authority29
. The imposition of the
29
It has been argued that the 1960 Agreements were in fact ratified by Greek Cypriots since that candidate who
stood - in the first presidential elections - on a platform of opposition to the Agreements was soundly beaten
78
agreements by outside powers without Cypriot participation, contributed to a view of
them as illegitimate by the Greek Cypriot majority (Tornaritis, 1969; Markides,
1977). Surely, this perceived illegitimacy must have negatively affected compliance
with the agreements.
Both UN proposals contemplate the holding of referendums by both
communities for the approval of the solution agreed to and by doing so implicitly
recognize the importance of open and explicit agreement with the terms of the
settlement, which if eventually accepted would, other things being equal, have a
better chance of being sustainable than the 1960 agreements. The Set of ideas
explicitly state that “[the agreement] will be submitted to the two communities in
separate referendums within 30 days of its completion by the two leaders at a high-
level international meeting” (Paragraph 1). The Comprehensive settlement similarly
foresees the holding of a referendum by both sides for the approval of the solution
(Article 1 of Draft Annex IX of the Foundation Agreement). This said, a reading of
the relevant provision points out that Cypriots are to be asked to accept both the
Comprehensive settlement and Cyprus’s accession to the EU simultaneously. Such
full-line forcing is likely designed to increase the likelihood of a yes vote from a
majority given overwhelming support for EU accession across Cyprus. On the other
hand, it is likely to reduce the perceived legitimacy of the agreed upon solution
compared to that legitimacy which would emerge if referendums on the solution and
EU accession were to be held separately.
That individuals may voluntarily agree to cooperate under certain
constitutional arrangements may depend on at least two factors namely, the
availability of exit at the time of negotiating the agreement and the adoption of a
“package deal”. I will turn to the exit option first.
(Necatigil, 1982; Ertekün, 1984). However, much of the legitimacy accorded to the Greek Cypriot president of
the Republic by his election in December 1959 to the post, “was based on the assumption that in reality he had
never given up the struggle for union with Greece and that the acceptance of independence was nothing more
than a tactical move that would eventually lead toward the incorporation of Cyprus within the Greek nation.”
(Markides, 1977: 26).
79
Individuals may voluntarily enter into the agreement insofar as they all
possess viable alternatives to the contract toward which they are negotiating
(Lowenberg and Yu, 1992). In this situation, no party would be able to coerce
another to accept terms of co-operation which are less favorable than the best terms
which may be obtained by striking co-operative agreements with others. The question
is whether both sides to the conflict in Cyprus have viable exit options. In the
absence of a solution, the internationally recognized Republic of Cyprus could
reasonably expect to continue to improve economically, socially and politically even
more so after its accession to the EU and the added security this would provide. On
the other hand, the internationally unrecognized “TRNC” is likely to find itself
increasingly isolated and dependent on Turkey for its survival - a country recall with
EU membership aspirations itself. This suggests that the Greek Cypriot side does
have a viable exit option while the Turkish Cypriot side does not.
Now, assume for the sake of argument, that the “TRNC” is granted
international recognition prior to negotiating a solution to the Cyprus Problem with
the aim of providing the Turkish Cypriots with a viable exit option at the negotiating
stage and thus, in the event of an agreement being reached, increase the degree of
voluntariness on their part and so positively effect the sustainability of the agreement.
The problem with this ‘confederal’ approach is that the Greek Cypriots are likely to
consider the institution of an exit option through the international recognition of the
“TRNC” to be unfair basically because it would amount to the international
recognition and hence legitimation of the forced and uncompensated expulsion of
Greek Cypriots from the north. For this reason, the international recognition of the
‘TRNC’ is likely to reduce the viability of any solution.
Consider next the relationship between voluntariness and the adoption of a
package deal. Voluntariness may be enhanced through the adoption of a complex
network or “package deal” of compromises, side payments, compensations, bribes,
exchanges and trade-offs, which aim to offset the predictable adverse distributional
properties of the proposed changes (Brennan and Buchanan, 1985; Mueller, 1991).
80
Having said this, the possibility should be admitted that some of the potential parties
to the agreement may be unwilling to trade within the greater context of a package
deal with those who are favored by the status quo distribution of entitlements,
because they perceive this status quo distribution to be unjust (Brennan and
Buchanan, 1985). The Greek Cypriot community arguably perceives the status quo
distribution of entitlements to be unjust since it leaves 37 per cent of the island in the
hands of 18 per cent of the population and it does so as a result of the non-
compensated expulsion of individuals, fruit of the 1974 Turkish invasion. This
suggests that a package deal which trades off concessions by the Greek Cypriot
community in other areas in return for territorial adjustments which take as their
starting point the status quo distribution of territory would be perceived as unjust by
Greek Cypriots and as such would be relatively less viable30
.
The possibility of a non-voluntary change of this status quo may lead the
holders of these “unjust” entitlements to voluntarily agree to concessions with
regards to these entitlements (Brennan and Buchanan, 1985). One question which
therefore emerges is whether the Turkish Cypriot community as the holder of unjust
territorial entitlements, are faced with the possibility of a non-voluntary change in
this area. The answer depends on the ability of Greek Cypriots to force such a
change, which in turn depends on the availability of either democratic or non-
democratic channels to this effect. Notwithstanding the normative undesirability of
non-democratic channels, one can state – for the sake of completeness – that these do
not exist given the fact that the current military balance favors the Turkish Cypriots.
Insofar as democratic channels are concerned these are represented by the various
international forums through which the resolution of the conflict is sought, mostly the
UN and more recently the EU. The limited territorial concessions made in the context
of negotiations under UN auspices points to the ineffectiveness of this forum. To the
extent that the EU proves to be a more effective forum to address the unjust
30
This includes package deals which trade-off better territorial arrangements for Greek Cypriots in return for
their acceptance of Turkish Cypriot statehood in the context of a partition-based solution (see, for example,
81
distribution of territorial entitlements created by the 1974 invasion, only time will tell
(see chapter 5 for a full discussion).
Ideological Conviction
One’s perception of the system’s fairness can also be affected by one’s ideological
conviction (North, 1981). Indeed, ideologies may be designed to get people to
conceive the system as just and successful counter-ideologies are those that convince
people that the existing system is unjust and that a just system may emerge from
one’s selfless participation in efforts to change the status quo. A consensus over
classical liberal ideas has exercised a positive influence on the sustainability of the
U.S Constitution. Thus, “The viability of the system from 1787 to today has been
fundamentally influenced by the strength of the heritage of ideas which helped to
define and limit choices.” (North, 1987: 166).
With this in mind I will now sketch out the evolution of nationalist ideologies
in Cyprus in the past half century. The national consciousness of the Turkish Cypriot
minority grew in direct proportion to the rise of Greek Cypriot national
consciousness (Markides, 1977). This was especially relevant for the pre-
independence period where the struggle for enosis led to a nationalist reaction by
Turkish Cypriots. The resultant ideological polarization was aggravated by the
British policy of recruiting Turkish Cypriots in the security forces as a
countermeasure. In the early 1960s, immediately after independence, the ideal of
enosis was still riding high given the immediacy of the struggle and this contributed
to the perceived unfairness of the 1960 Constitution and thus efforts to amend it
(Markides, 1977; Kizilyürek, 1993). These efforts strengthened partitionist views
among the Turkish Cypriot community, which were greatly reinforced by the inter-
ethnic violence during the 1960s leading to the consolidation of those Turkish
Cypriots advocating partition (Attalides, 1976; Markides, 1977). In the late 1960s, an
Bahcheli, 2000).
82
increasingly higher standard of living in Cyprus compared to Greece and the rise of
the Junta in the latter, led to a fading of the ideal of enosis among the Greek Cypriot
community and the adoption by many of the idea of an independent Republic
(Ehrlich, 1974; Peristianis, 1995)31
. Partition continued to be the dominant ideology
in the Turkish Cypriot community which was increasingly concentrated in ever-more
heavily armed enclaves under the control of virulent Turkish nationalists (Attalides,
1976; Markides, 1977).
In the post-invasion period and insofar as the Greek Cypriot community is
concerned, the feeling of betrayal by Greece – due to the role played by the Greek
Junta in the period immediately prior to the 1974 invasion and the absence of military
support from the newly installed democratic government in the face of further
Turkish territorial advances, – led to the retreat of enosis (Stamatakis, 1991). This
was reinforced by the need to shore up the international recognition of the Republic
of Cyprus and the desire to achieve rapprochement with the Turkish Cypriot
community and so avoid the definitive partition of the island (Peristianis, 1995). Over
time however, a new form of hellenocentrism – one not based on the ideal of enosis –
has been gaining ground among Greek Cypriots for several reasons including: the
return of democracy in Greece and its accession to the EU; reduced expectations that
the problem will be justly resolved by way of the UN in accordance with
international law (including international human rights law) and the corresponding
increased perception of Greece as the main ally in the search for an acceptable
solution; a perpetual feeling of insecurity generated by the continuing presence of
Turkish troops in the north of the island and; the increased uncertainty facing
individuals brought about by both rapid economic development and a decay of social
ties and religious convictions (Peristianis, 1995).
Insofar as the Turkish Cypriot community is concerned, Turkish nationalism
was, in some sense, ratified in the aftermath of the Turkish invasion by the increased
31
This fits nicely with the assertion that “however powerful (ideology) may be as an initiating force in
overcoming the free-rider problem and creating revolutionary cadres … it tends to fade over time when it runs
83
feeling of security generated by the defacto partition of the island and the
appropriation of 37 per cent of the island and its resources. However, economic
stagnation has led, over time, to a decline in enthusiasm for partition and increasing
integration with Turkey and the emergence of more moderate views in favor of inter-
communal integration of a mostly economic nature. This dynamic has been mitigated
by the emigration of many Turkish Cypriots and the immigration over the years of
Turkish settlers who, according to McDonald (1989) and Theophylactou (1995), may
be more inclined to have turkocentric views32
.
One idea which springs from this discussion is that the ideological polarization
of both communities over the years has been partly the result of a lack of security
broadly defined in terms of physical, political and economic security. In particular,
ideological polarization in both communities has tended to increase by a feeling of
physical insecurity (in the case of Turkish Cypriots prior to 1974 and for Greek
Cypriots after it) and turkocentrism has moreover been reinforced by a feeling of
political insecurity. The feeling of economic security experienced by the Greek
Cypriot community has tended to dampen enosis-based hellenocentrism while the
economic stagnation experienced by the Turkish Cypriot community in part due to its
economic integration with Turkey has tended to dampen Turkocentrism. This points
to the importance of addressing both sides concerns in the area of physical security,
as well as the need for the political institutions of a reunified Cyprus to avoid the
tyranny of the minority (majority) by the majority (minority). The discussion also
indicates that ideological polarization is likely to be mitigated over time if both
communities experience a sustained period of gradual economic growth in a reunified
Cyprus.
counter to the behavioural sources of individual wealth maximizing …”. (North, 1990: 132ff). 32
In this respect, it has been estimated that 30,379 Turkish Cypriots have emigrated over the period 1974-
1987, while 50,271 Turkish settlers may have immigrated during the period 1974-1989 (Ioannides, 1991). In
the spirit of Hirschman (1970), the exit over time of Turkish Cypriots unsatisfied with the status quo, and the
entry of Turkish settlers who would arguably be more loyal to it, may reduce the possibility that the voice
option will be taken up widely and effectively and, ultimately, the chances of a change in the status quo
situation in the “TRNC”.
84
Ideological polarization could also be mitigated by the official recognition and
apology for the wrongs committed against the other community in the past and the
revision of school curriculum so that emphasis is put on common rather than divisive
elements. The Set of ideas envisages the latter (see paragraph 8 in its attached
Appendix) while the Comprehensive settlement makes provision for both the latter
and the former through the creation of a Reconciliation Commission composed of
Greek and Turkish Cypriots whose aims include the preparation of a comprehensive
report on the history of the Cyprus Problem and the drafting of guidelines for
publications and school textbooks so as to promote mutual understandings of
different perspectives on the past (Article 2 of Draft Annex VIII of the Foundation
Agreement).
Four Specific Factors Advanced by Douglass North
Apart from these two general factors which I put forward here, North (1981) lists
four specific factors which he argues may alter one’s perceptions of justice or
fairness;
- an alteration in property rights which denies individuals access to resources
which they had come to accept as customary or just;
- a decline in the terms of exchange in a factor or product market away from
what had come to be regarded as a just exchange ratio;
- a decline in the relative income position of a particular group in the labor force
and;
- a reduction in information costs that results in individuals perceiving that
different and more favorable terms of exchange may prevail elsewhere.
Because the parties have expressed their positions on the right of property and the
related freedom of establishment in relative detail, I will focus here on the first factor
85
above. Insofar as the other three are concerned one can briefly suggest that the
perceived justice of any solution to the conflict on the part of individual citizens
would be increased insofar as this contributes and is linked to a favorable evolution
in factor prices (for example, wages and interest rates), retail prices and one’s relative
income position in the labor force. A negative evolution of these economic variables
would have the opposite effect on individual’s perceived justice of a solution. The
last factor is related to the information available to Cypriots on both sides of the
Green Line about the terms of exchange available “on the other side”. One would
expect well informed individuals to be aware of any differential in the terms of
exchange and this can be expected to influence the perceptions of fairness and hence
viability of the system or regime within which they currently live.
A reading of the Set of ideas and even more so the position taken by the
Turkish Cypriot side shortly afterwards reveals severe limits to the freedom of
establishment and the right of property ranging from the expropriation of the
properties of displaced persons and their corresponding compensation at below
current market values, to the imposition of a moratorium and an upper limit on the
right of establishment of Greek Cypriots in the north so as to preserve the
bicommunal and bizonal character of the federated state. Similarly and in more
detail, the Comprehensive settlement envisages long term limitations to the freedom
of establishment to the extent that a maximum of 28 per cent of the population of the
relevant component state can hail from the other component state, albeit with a
proviso that such limitations will be reviewed no later than 25 year after the
reunification of the island. Insofar as property rights are concerned the proposal
envisages maximum levels of reinstatement to persons hailing from the other
component state (no more than 9 per cent in any give municipality or village, no
more than 14 per cent of the total land area and of the number of residences of any
86
component state), the expropriation of properties and the compensation of their
original owners at current prices33
.
To the extent that the terms of a solution to the Cyprus Problem formally limit
the right of property and the freedom of establishment they obviously would deny
people access to resources which they had come to accept as customary or just
thereby mitigating their perceived justice and ultimately compromising the viability
of co-operation. This points to the need to reduce restrictions to the freedom of
establishment and access to property. In this vein, the ability to revise restrictions on
the freedom of establishment in the long run could have a positive effect. Moreover,
one can also reduce the negative effect on viability by decreasing the area to come
under Turkish Cypriot administration to allow a majority of Greek Cypriots to return
home under Greek-Cypriot administration.
THE INFLUENCE OF INFORMAL RULES
The viability of a co-operative agreement may also be seen to be affected by the
continuing influence of informal rules; a phenomenon known as path dependence.
Thus, while the formal rules may be changed by a revolution, the informal norms
such as customs and traditions which provide legitimacy to a set of rules change only
gradually (North, 1994). The legitimacy of the new rules in the post-revolutionary
33
An interesting legal question which emerges here is whether a solution can be adopted which violates
individual property rights as they were enjoyed prior to the Turkish invasion. The European Court of Human
Rights (ECHR) has found Turkey responsible for the continuing violation of a Greek Cypriot’s right to enjoy
her property peacefully and said that Turkey exercises effective overall control in the occupied part of the
island (Case of Loizidou v. Turkey, 40/1993/435/514). However, a reading of the judgement shows that this
right of property may be violated in the public interest. Paragraph 48 points to Article 1 of protocol 1 of the
European Convention of Human Rights that states, “Every natural or legal person is entitled to the peaceful
enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and
subject to the conditions provided for by law and by the general principles of international law.” This points to
the possibility that a settlement may violate property rights in the public interest. Indeed, it is likely to
influence the ECHR’s decision if, as is envisaged in the Comprehensive settlement, it is asked to strike out any
proceedings currently before it concerning affected properties (Article 5 of Draft Annex VII of the Foundation
Agreement). Its also worth mentioning the inclusion in the Comprehensive settlement of a ‘past acts’ provision
which recognizes as valid any legislative, executive or judicial act by any authority prior to the entry into force
of the Agreement (Article 12 of the Foundation Agreement). Among other things, this refers to administrative
87
period may initially be small thereby increasing the cost of maintaining the post-
revolutionary status quo but this legitimacy increases as informal norms gradually
adjust to the new formal rules and so the costs of maintaining the new order fall
through time34
.
Implicit in the above argument is that the influence of informal rules on
individual behavior may be high when different formal rules are initially adopted but
will fall over time. But this may not necessarily be the case. In particular, informal
rules may compete with formal rules in the co-ordination of social action. Indeed,
“because social action is coordinated also by a variety of informal norms or
undescribed evolutionary processes that can coincide with more insidious things
such as ethnicity, language, and race [constitutions] must be designed to compete
with other things for the political-economic organization of society.” (Ordeshook,
1992: 148).
Two questions arise here. First whether it is important for the viability of the
system that the formal rules which regulate co-operation should be designed to
compete with informal ones and, if so, how formal rules should be designed so that
they can be more competitive? The answer to the first question is, emphatically, yes,
since, it is clear that insofar as informal rules regulating intra-ethnic relations
promote ethnic identification, they may lead to sub-optimal outcomes. Ethnic
identification may lead ethnic groups to co-ordinate their actions (either
spontaneously or because of the actions of political representatives) to the detriment
of other ethnic groups. This obviously represents a threat to inter-ethnic co-operation
since it points to the existence of forces that may facilitate the co-ordination of
defection and thus the break down of co-operation. The possibility that inter-ethnic
co-operation may be undermined by the influence of informal rules points to the
need for competitive formal rules for such co-operation.
decisions in both the north and south of the island which have granted rights on the properties of displaced
persons to others. 34
This reasoning is consistent with the assertion that the longer a constitution has been enforced the greater the
tradition and respect behind it and therefore the more likely that it will be followed (Olson, 1984).
88
This still leaves the question of how formal rules which promote inter-ethnic
co-operation can be designed to out-compete informal rules which promote the intra-
ethnic kind. The existence of transaction costs in family, market or political
relations, creates a demand for mechanisms to reduce these which can be met by
ethnicity-based informal rules (Wintrobe, 1995). In particular, ethnic mores and
customs, like a common language or religion, are likely to reduce individuals’ costs
of transactions with one another (Hardin, 1995; Congleton, 2000). In the market,
common traits may act as a screening device allowing individuals to predict the
contractual behavior of trading partners whereas traditional codes of conduct or
informal rules may act as substitutes to contract law (Landa, 1981). Informal rules
may survive then despite large changes in the formal rules, because they resolve
basic social, political or economic exchange problems among participants (North,
1990). This points to the need for formal rules to out-compete informal ones which
while they may resolve basic exchange problems they may do so at the cost of inter-
ethnic cooperation.
Insofar as informal rules survive because they solve basic exchange problems
in the market then they could be undermined by the efficient enforcement of
property rights in the market by non-ethnic institutions. Conversely, the value of
ethnic networks – as mechanisms which may mitigate the contractual enforcement
problem, – arises when a (central) state’s enforcement activities become increasingly
ineffective (Pejovich, 1993; Congleton, 1995). The efficient enforcement of property
rights by non-ethnic institutions would arguably reduce the need to rely on informal
rules which may favor intra-ethnic cooperation. Both the Set of ideas and the
Comprehensive settlement leave the enforcement of property rights and civil law in
general to the federated or component states, something which is reminiscent of the
1960 Constitution which set up the Republic of Cyprus and which entrusted civil
cases (where all parties came from one ethnic group), to courts made up of judges
from that group (Article 159). By doing so it arguably foregoes the possibility for
ethnically neutral institutions to provide non-discriminatory protection of property
89
rights across ethnic groups, something which could undermine informal rules which
may be inimical to inter-ethnic co-operation but survive because they resolve basic
economic exchange problems.
Consider now the implication which emerges from the suggestion that
informal rules promoting intra-ethnic cooperation may survive because they solve
basic exchange problems in the family (Wintrobe, 1995). Poor parents may transmit
ethnically based informal rules to their children in return for their obedience in later
life in the form of direct support and attention in their old age, as well as indirect
support by making decisions based on their preferences. Being poor they are less
able to “buy” this support through bequests and so they must rely on informal rules.
By implication then one would expect to see less ethnically based parental
indoctrination in societies with generous pension or social security (Wintrobe, 1995).
More generally, it has been argued that to the extent that ethnic groups have
traditionally provided social security to their members then the emergence of the
welfare state may have reduced individual incentives for group identification
(Hechter, 1987). Given my discussion in the previous chapter I would add that if this
has happened it is because the basis of entitlement in the welfare state is some non-
ethnic criterion like relative income.
JUDICIAL ENFORCEMENT AND LEGISLATIVE MAINTENANCE
To the extent that the usefulness of reciprocity or exit to promote viability is limited,
the perceived fairness of the terms of the co-operation falls and ethnicity-based
informal rules continue to exert a competing influence on individual perceptions of
legitimacy, then the sustainability of the co-operative solution may increasingly rely
on a fourth factor namely, that of judicial enforcement and legislative maintenance.
Insofar as judicial enforcement is concerned, it is interesting to consider the
experience of the Supreme Constitutional Court charged with enforcing the 1960
Constitution. The Supreme Constitutional Court decided to adopt the civil-law
90
practice of issuing a single opinion rather than the common law practice of
dissenting opinions since dissenting opinions would weaken the Court’s ability to
lessen friction (Ehrlich, 1974). During the two and a half years of the functioning of
the 1960 Constitution, the Court acted as a moderating influence as indicated by the
fact that it filed over one hundred cases many of which involved “significant issues
between Greeks and Turks”.
However, when the Council of Ministers – rather than establish separate
Turkish Cypriot municipalities as foreseen in the Constitution – invoked a pre-
independence statute and declared that the five main towns were “improvement
areas” to be governed by special boards thereby giving the Turkish Cypriots little
control of their own sectors of the towns, the Turkish Communal Chamber applied to
the Supreme Constitutional Court for a ruling that the Council’s order was void and
the Court upheld this but for the first time the Greek Cypriot judge dissented. And
when – in response to the Greek Cypriot refusal to establish separate Turkish Cypriot
municipalities – this Turkish Communal Chamber adopted its “own Municipal Law”,
the Court ruled (on the same day) that this was also unconstitutional, the Turkish
Cypriot judge dissented.
The dissent of both the Greek Cypriot and Turkish Cypriot members of the
Court on decisions which came out “against” the position of their group must have
surely damaged the credibility of the Court and as such undermined its ability to act
as a moderating influence. One way to respond to this could be by increasing the
number of judges sitting on the Court to include at least three members from each
community. This would permit the emergence of a moderate majority across ethnic
lines. It is arguably more difficult for the moderate line to be taken by a judge if he or
she is the only one sitting on the Court from his community since he or she is more
likely to be under strong pressure to “represent” the interest of his community rather
than limit him or herself to enforcing the Constitution. The Comprehensive
settlement seems to recognize as such by envisaging a Supreme Court of 9 judges,
three from each component state and three non-Cypriots (Article 6 of the Foundation
91
Agreement). It moreover follows the 1960 practice of issuing joint judgments
(Article 35 of Draft Annex I of the Foundation Agreement).
With respect to the legislative maintenance of the constitutional order, a
compound republic of countervailing constitutional guardians has been advocated
(Wagner, 1993). In particular this refers to a federal system where the executive,
legislative and judicial branches are separated, with the legislature itself divided into
different branches (see also Lowenberg and Yu, 1992 ; Ordeshook, 1992). The
constitutional provisions contained in the UN proposals contain some features of a
compound republic namely, a federal system with a separation of powers among the
executive, a two-house legislature and an independent judiciary. In addition, the
proposals envisage that the Constitution of a reunified Cyprus can only be amended
either with the approval of both federated states (Article 9 of the Set of ideas) or after
amendments have been adopted by both Chambers of Parliament and approved by
separate majority of the people in each component state (Article 36 of Draft Annex I
of the Foundation Agreement). This gives each federated or common state a veto and
provides a powerful tool in favor of the status quo situation established by any
mutually accepted settlement of the Cyprus Problem.
92
CHAPTER 5.
A VIABLE SOLUTION TO THE CYPRUS PROBLEM
IN THE CONTEXT OF EUROPEAN UNION ACCESSION
INTRODUCTION
On the 12th
of December 2002 Cyprus was invited to accede to the EU and is likely
to do so in May of 2004. This was the culmination of a series of moves and decisions
by both the government of the Republic of Cyprus and the EU that began with
Cyprus’s official application to become a member on the 4th
of July of 1990. It
should be seen against a background that includes intercommunal talks under UN
auspices and a growing frustration by Greek Cypriots with the lack of progress
achieved. The government of the Republic has maintained that the prospect of EU
membership may act as a catalyst on the search for a solution to the conflict and
argued that in the event that no solution is agreed to, the Republic of Cyprus should
be admitted to the Union. The application of the acquis communautaire over the
whole territory of the island would then be pending the subsequent re-unification of
the island. These positions were adopted by the European Council in December 2002.
These moves are opposed by the Turkish Cypriot leadership because, they
argue, they would bring about the realization of enosis, albeit indirectly. They argue
that Cyprus should enter only after a settlement and after Turkey has become a full
member. They also set as a condition for their participation in Cyprus-EU accession
negotiations, the international recognition of the sovereignty of the “TRNC”. In
response to developments, both the Turkish Cypriot and Turkish leaderships had
threatened to undertake the “partial integration” of the occupied north with Turkey in
the security, defense and foreign policy fields. When accession negotiations were
eventually launched with the government of the Republic of Cyprus, Turkey reacted
by lifting customs barriers and signing a free trade agreement with the “TRNC”.
93
Moreover, the Turkish Cypriots rejected the invitation by the government of the
Republic to participate in the accession negotiations as a part of the Cypriot
delegation.
In this chapter, I will focus my discussion on the effects of the prospect of EU
membership and eventual membership itself on the viability of a solution to the
Cyprus Problem. In particular, I will identify the EU’s pre-accession strategy vis-à-
vis Cyprus and evaluate it in the light of the need to attain a viable solution to the
Cyprus Problem. Moreover, I will discuss how eventual membership of the EU may
increase the viability of a solution35
.
THE EU’S PRE-ACCESSION STRATEGY
In this pre-accession stage, the EU seems to be attempting to contribute towards the
solution of the Cyprus Problem by adopting a carrot and stick approach with respect
to both the Greek and Turkish Cypriot sides (see also, Neisser, 1996; Papasotiriou,
1998)36
. Insofar as the carrot is concerned, the EU basically argues that accession to
the Union will increase the security and economic well-being of all Cypriots
regardless of their ethnic origins and has pointed to those economic benefits which
could flow to the Turkish Cypriot administered sector in the form of a participation
in European Structural Funds as well as the Common Agricultural Policy. Beyond
these funds the EU has agreed to disburse 206 million euros between 2004 and 2006
for the economic development of northern Cyprus in case of the accession of a
reunified island.
35
A previous version of this chapter, which does not incorporate the December 2002 decision to admit Cyprus
to the EU or the Comprehensive settlement, was published as Kyriacou (2000c). Other scholars have examined
Cyprus-EU relations. Their historical evolution has been documented by Gaudissart (1996) and Joseph (1999)
among others. The economic consequences of Cyprus’s accession to the EU have been considered by, for
example, Kranidiotis et al (1994). Stavrinidis (1999) has undertaken a critique of the EU’s policy towards the
Cyprus Problem. The possible links between EU accession and ethnic or national identities, political and civic
cultures on the island have been discussed by Peristianis (1998) and Mavratsas (1998). The possible
contribution of the EU to the resolution of the conflict has been briefly discussed by Nicolaides (1993) and
more recently by Theophanous (2000a, b, c). 36
See appendix C for a summary of the EU’s position towards a solution to the Cyprus Problem.
94
At the same time the EU has applied the stick to the Turkish Cypriot side in
several ways. Firstly, the EU has reinforced the international standing of the
government of the Republic of Cyprus by recognizing it as the sole legal government
on the island. Moreover it supports a solution to the Cyprus Problem in accordance
with relevant UN resolutions. Further, in the early stages of the island’s accession
course it had signaled that while the fundamental interests of each community must
be preserved by the settlement, the institutional provisions of any settlement must
assure the fundamental freedoms enshrined in its constituting Treaty, in particular
the freedom of movement of factors of production, goods and services, the freedom
of establishment and universally recognized political, social and economic rights.
The Union opened up accession negotiations with the government of the Republic of
Cyprus as the sole recognized interlocutor and has invited the Republic to become a
member independently of a solution to the conflict.
The stick has also been applied to the Greek Cypriot side. Thus, early on in
the pre-accession period the EU had maintained that the accession of the island to the
EU implies a lasting settlement to the Cyprus Problem. More recently, the Union had
decided that Cyprus will be admitted to the Union even in the absence of a political
settlement but “taking into account all relative factors” (which likely refers to the
efforts made by both communities in search for a solution). Moreover, it has always
maintained its preference for the accession of a united island and until relatively
recently several Member States had expressed their resistance towards the admission
of a divided island into the Union. Finally, although in the past it has stated that a
solution to the conflict must assure the fundamental freedoms enshrined in its
constituting Treaty, it has recently expressed support for the Comprehensive
settlement presented by the UN Secretary General and has expressed its willingness
to accommodate the terms of a settlement in the Treaty of Accession, albeit
rhetorically, “in line with the principles on which the EU is founded” 37
.
37
I say rhetorically because by supporting the Comprehensive settlement the EU is also supporting violations
to its fundamental rights. In particular, the Comprehensive settlement violates the right of establishment
95
.
THE PRE-ACCESSION STRATEGY:
MUTUAL BENEFITS AND MUTUAL CONCESSIONS
Given this discussion consider now the effect of the EU’s strategy on the status quo
situation on the island. One way of illustrating this is through the divided PD-game
presented in chapter 4. Recall that in a divided PD-game, a common interest in order
(co-operation) co-exists with conflicting interests about which order will prevail and,
in particular, the parties are faced with the choice of limited anarchy and two
conflicting perceptions of order and that agreement requires concessions by each
party38
.
The divided PD-game is represented in utility space in figure 4 below. Each
community is faced with the choice of limited anarchy (represented by the status quo
situation) or co-operation under two conflicting sets of terms 1 and 2. In particular
and repeating from chapter 4, the Greek Cypriot side prefers a strong federal
arrangement with fewer checks and balances, the unrestricted enjoyment of the
freedom of movement and settlement and the right of property in the long run, 20 per
cent to 25 per cent of the land under Turkish Cypriot administration and the
complete demilitarization of the island with a security guarantee provided by the
(Article 43 of the Treaty Establishing the EC) and both the general right to vote and stand for office (enshrined
in Article 3 of Protocol 1 of the European Convention for the Protection of Human Rights and Fundamental
Freedoms which according to Article 6 of the Treaty on EU is to be respected by the EU) as well as the more
specific right to vote and to stand as a candidate in municipal elections in the Member State in which one
resides (Article 19 of the Treaty Establishing the EC). The right of establishment is clearly violated by the
requirement that only 28 per cent of the population of the relevant component state can hail from the other
component state. As for the right to vote it is violated by the fact that a person from one component state who
chooses to live in the other will not enjoy political rights there unless he or she adopts that component state’s
citizenship status (something one can only do after seven consecutive years of residency there) or unless he or
she lives in specified villages or is a member of a religious or other minority. Thus, during the first seven years
of residency in the other component state an individual will be unable to vote and to stand as a candidate at the
component state level and the possibility exists that he or she will also be unable to do so at the local level.
Admittedly, Article 19 allows for derogations from the right to vote and to stand as a candidate in municipal
elections in the Member State in which one resides where warranted by problems specific to a Member State.
However, by incorporating the European Convention for the Protection of Human Rights and Fundamental
Freedoms the EU should, arguably, ensure that any derogations must ‘not curtail the rights in question to such
an extent as to impair their very essence and deprive them of their effectiveness’.
96
international community (terms 1). Alternatively, the Turkish Cypriot side prefers a
confederal arrangement replete with checks and balances, a permanently limited
enjoyment of the freedom of settlement and the right of property, 29+ per cent to 37
per cent of the island under Turkish Cypriot administration and, finally, a continued
Turkish troop presence on the island and a legal right of unilateral intervention by
Turkish armed forces (terms 2).
Figure 4. The EU’s Pre-accession Strategy
The approach to the Cyprus Problem taken by the EU may have several effects on
this divided prisoner’s dilemma. First, to the extent that accession can, as the EU
argues, increase the security and well being of all Cypriots it will lead to an outward
shift of the contract curve and so, a-priori, shift the ideal points of the Greek and
Turkish Cypriots respectively to 1’ and 2’. How is one to read this shift? Given
38
Anayiotos (1991) has employed a similar framework to examine the bargaining between Greek and Turkish
Cypriots prior to the application for EC membership.
Greek Cypriot
Utility
Turkish
Cypriot
Utility
0
2’
1’
Status Quo
2
1
97
points 1’ and 2’ are, respectively, above points 1 and 2 then both parties would
prefer any solution between terms 1’ and 2’ (which implies EU membership) to
solutions between terms 1 and 2. This reflects the economic and security benefits
which may derive from EU membership under any solution between the ideal points
of the two sides.
Second, the EU has over time applied pressure on the Turkish Cypriot side to
move along the contract curve, away from 2’ and towards 1’. In particular the EU
has always maintained that it has no intention to afford the “TRNC” international
recognition and that it does not support efforts towards a confederal solution to the
problem. Early on in the accession course its position was that any solution must
assure fundamental rights and freedoms. And in the latter stages of this course it has
declared its acceptance of the accession of the island regardless of the status of the
Cyprus Problem, a position which it has ratified by inviting Cyprus to become a
member independently of a solution. But the EU has also pressured the Greek
Cypriot community for it to move away from 1’ towards 2’. In the beginning of
Cyprus’s accession course it signaled to the Greek Cypriots that membership was
conditional on a resolution to the conflict but this position was abandoned later on
(in part, it could be argued, due to the threat of a Greek veto of the eastern
enlargement). While Cyprus has been invited to accede to the EU independently of a
solution, the preference is still for a reunified Cyprus to accede and to facilitate this
outcome, the EU is willing to accept a solution which deviates from the fundamental
freedoms enshrined in its constituting Treaty (freedom of establishment and the right
to vote) to the detriment of Greek Cypriot positions.
In sum then, the EU’s pre-accession strategy seems to be to pressure each side
to the conflict into making concessions and thus move away from its ideal point and
towards some intermediate point between 1’ and 2’; a point which describes a non-
confederal reunified Cyprus where, if need be, fundamental freedoms are violated.
One could argue that in the interests of regional stability the EU (and the U.S.) would
like to see a peaceful solution to the Cyprus issue and that the contents of the package
98
deal (that is, the point reached on the contract curve) are of secondary importance39
.
If this is indeed the underlying position of the EU in the matter then it is a short-
sighted one since it ignores the fact that regional stability can only be attained to the
extent that the solution to the Cyprus Problem is a viable one (Theophanous, 2000c).
This points to the importance of identifying how the prospect of EU accession as well
as eventual membership of the EU can affect the attainment of a viable solution to the
conflict. To shed some light on this issue and by way of my discussion in chapters 3
and 4 above, I will now identify those factors which can affect the viability of any
solution to the Problem and which are related to EU membership. In particular I will
argue that viability can be enhanced:
(i) insofar as the likelihood of majority tyranny of the minority is reduced;
(ii) in the presence of sufficient security guarantees;
(iii) to the extent that the chosen solution is perceived to be fair;
(iv) through the emergence of supra-ethnic sources of identity and the “logic of
appropriateness”.
The second and third of these factors have important implications for the EU’s pre-
accession strategy while the first and fourth suggest that eventual membership of the
EU is likely to increase the viability of a reunified Cyprus.
THE LIKELIHOOD OF MAJORITY TYRANNY OF THE MINORITY
As already stated in chapter 3, a minority which is permanently marginalized in the
normal course of democratic politics is likely to reject the very concept of inter-
ethnic co-operation within the context of a multi-ethnic state leading to the state’s
39
On a more critical note, Stavrinidis (1999) has argued that the EU has adopted a ‘pragmatic approach’
towards Cyprus based above all on the need to avoid antagonizing Turkey even at the cost of, on the one hand,
no progress on the Cyprus issue and, on the other, of undermining both its declared principles on the promotion
of democracy and human rights and the emergence of an efficient Common Foreign and Security Policy.
99
disintegration. The viability of co-operation would thus be enhanced to the extent
that the EU provides a formal institutional framework that reduces the likelihood of
the tyranny of the Turkish Cypriot minority by the Greek Cypriot majority.
One way that it may do so is through article 13 of the Treaty establishing the
European Community that allows the Council, acting unanimously to take
appropriate action to combat discrimination based on sex, racial or ethnic origin,
religion or belief, disability, age or sexual orientation. More importantly, Article 7 of
the Treaty of the EU, as amended by the Treaty of Nice, states that if a Member State
seriously and persistently breaches the principles of liberty, democracy, respect for
human rights and fundamental freedoms, and the rule of law, the European Council
acting by qualified majority may decide to suspend certain of the rights deriving
from the application of the Treaty on EU to the Member State in question, including
the voting rights of the representative of the government in the Council. Article 7
surely increases the cost to any Member State, of violating these rights and as such
decreases the likelihood of majority tyranny emerging.
The likelihood of the permanent tyranny of the Turkish Cypriot minority by
the Greek Cypriot majority can also be mitigated to the extent that the policy
discretion of the future central government in a reunified republic is constrained. In
this vein, Nicolaides (1993) has argued that since the EU’s internal market bans
discrimination and establishes free and open markets for goods and services, this
makes the economic discrimination of minorities more difficult. Similarly, this
author argues that the successive steps to deepen the Union (by expanding the policy
competencies of the Union in areas such as monetary policy, external affairs and
security, education, culture, etc.), gradually reduce the policy discretion of the
central government of a future reunified Cyprus thereby mitigating the possibility
that Turkish Cypriots are “turned into second-class citizens by the central
government as they fear”.
Finally, the possible emergence of the permanent tyranny of the Turkish
Cypriot minority by the Greek Cypriot majority can be mitigated by decentralizing
100
collective decision-making so as to grant the minority the authority to decide on
issues over which its preferences differ markedly from those of the majority. The EU
envisages the creation of an ever-closer union among the peoples of Europe in which
decisions are taken as openly as possible and as closely as possible to the citizen
(Article 1 of the Treaty on EU) and in accordance with the principle of subsidiarity
(Preamble and Article 2 of the Treaty of the EU). This suggests that the Union
provides an institutional framework that can accommodate decentralized collective
decision-making and as such, can potentially reduce the likelihood of the permanent
tyranny of the minority by the majority40
.
SECURITY GUARANTEES
The attainment of a viable agreement to the conflict is strongly dependent on the
institution of effective security guarantees for both communities in a future reunified
Cyprus. The Turkish Cypriots put a premium on the security considerations relative
to the economic benefits that would flow from reunification. Recall from my
discussion in the previous chapter that the huge losses which could emerge from the
breakdown of a reunified Republic are likely to be in the minds of Turkish Cypriots.
The Greek Cypriot community is also concerned with security and, in particular,
desires some firm guarantee that the island will not suffer a repeat of the 1974
Turkish invasion (Papasotiriou, 1998). Apart from the security interests of each
community, this last author has pointed to Turkey’s strategic interest of neutralizing
the threat of a predominantly Greek island so close to its shores.
Given this range of security interests, Papasotiriou has advocated entrusting
the future security of a reunified and demilitarized Cyprus to a NATO force. Of
course, given the decision by the European Council in December 1999 to set up a
40
It is interesting to note that according to an attached protocol (protocol 30 annexed to the Treaty establishing
the European Community), the application of the principle of subsidiarity should not violate the Union’s acquis
communautaire. The attached protocol would thus tend to be inconsistent with the bizonal federation envisaged
in the Comprehensive settlement since it places limits on the freedom of establishment and the right to vote.
101
rapid reaction force of up to 60 000 troops by 2003, another provider of security
guarantees in Cyprus may be the EU itself. Regardless of the institution that
eventually provides these guarantees after a settlement is reached, there are two
points worth making here.
First, given the primacy placed on security concerns by the different parties,
the satisfaction of these concerns could go someway towards eliminating a large
obstacle standing in the way of the reunification of the island (Papasotiriou, 1998.)41
.
If this is accepted, then the important thing is to make an explicit commitment to
provide these in the event of a settlement so as to facilitate its attainment. In the case
of the EU, this would mean adopting a firm commitment to do so as an integral part
of its pre-accession strategy.
Second, and again by reference to chapter 4, the guarantees have to be
credible if they are to satisfy each party’s security concerns. They therefore should
incorporate processes that minimize the capability of any one member to manipulate
them for partisan interests (something which, incidentally, tends to undermine the
UN’s attractiveness as a guarantor of security). One way of doing this is by
endowing the international security force with a clear mandate to respond decisively
(credibly) to violent non-cooperative behavior by either ethnic group, subject to the
decision of a simple majority of those who are members to the arrangement.
THE PERCEIVED FAIRNESS OF A SOLUTION
As I have already argued in chapter 4, the viability of any agreement may be seen to
be directly related to its perceived fairness. Thus, the higher the perceived fairness of
an agreement, the less likely people are to defect from it and the lower the costs of
maintaining or enforcing it. My previous discussion points to several factors which
may affect the perceived fairness of a solution and which may be relevant here.
41
Similarly, and after examining forty-one cases of civil war in the twentieth century, Walter (1997) concludes
that third party enforcement of a peace treaty is a necessary condition for achieving a civil war settlement.
102
First, I have argued that the perceived justice of a solution is likely to be
increased if it is approved by both communities in separate referendums. However,
the Comprehensive settlement ties the approval of a solution with the decision to
accede or not to the EU – a case of full-line forcing. As I have said, while this may
be intended to increase the likelihood of a yes vote from a majority in each
community given overwhelming support for EU accession across Cyprus this is
likely to reduce the perceived legitimacy of the agreed upon solution compared to
that legitimacy which would emerge if referendums on the solution and EU
accession where to be held separately.
Second, the international recognition of the “TRNC” with the view of creating
a confederal Cyprus would be perceived as unfair by the Greek Cypriots since what
the Turkish Cypriots pretend to be their part of this confederation is the result of the
forced and uncompensated expulsion of Greek Cypriots from the north. The EU’s
position against such international recognition is consistent with this and insofar as it
contributes to avoiding the creation of a confederation would make a positive
contribution to the viability of reunified Cyprus.
Third, I have already argued that the Greek Cypriot community is likely to
perceive any “package deal” arrangement which is based on the status quo
distribution of territory created by the 1974 Turkish invasion as unjust, thereby
compromising the viability of any agreement based on this distribution. Recall that
the possibility of a non-voluntary change in the status quo distribution may lead the
holders of unjust entitlements to make concessions with regards to this distribution,
thereby increasing the perceived fairness of the agreement and consequently
increasing its viability. The relevant question that emerges is whether the EU has
provided a more effective democratic channel through which to force such a change.
My previous discussion suggests that while the EU has generally pressured the
Turkish Cypriot side to be more accommodating in its positions it has not applied
any specific pressure on it as the holder of unjust territorial entitlements. Moreover,
that pressure which has been applied has been undermined by either the linking of
103
accession with the prior resolution of the conflict or by adopting a certain studied
ambiguity on this question. While this policy approach may have been designed to
keep the pressure on the Greek Cypriot side as well, it reduces the likelihood of
concessions from the Turkish Cypriots as the holders of unjust territorial
entitlements and consequently may reduce the viability of any agreement reached.
The latest decision to invite Cyprus to join the Union independently of a settlement
and – assuming that no solution is found until then – the actual accession of Cyprus,
reinforces the Greek Cypriot side’s negotiating position (for the reasons alluded to in
chapter 4), something which may allow for concessions to be drawn in this area
thereby increasing the viability of any solution.
Fourth, I have argued that insofar as the final solution to the conflict violates
the freedom of establishment it is likely to be perceived as unfair by Greek Cypriots
thereby negatively affecting the viability of any solution. The feeling of unfairness
would be exacerbated by the fact that the citizens of other EU countries are likely to
be able to fully enjoy this freedom42
. Thus, the situation could emerge that displaced
Greek Cypriots who have moreover been dispossessed of their properties in the north
would be unable to fully enjoy the freedom of establishment there whereas the
citizens of other EU member states would not face this limitation. The EU’s
willingness to accommodate derogations to such freedoms in the context of a solution
is probably motivated by the desire to facilitate a solution such that a reunified island
can accede to the Union, but it comes at a cost of foregoing the opportunity to push
for a solution which avoids such derogations; a solution which I have argued is likely
to be a more viable one. Again, the decision to invite Cyprus to join the Union
regardless of a settlement and even more so the actual accession of Cyprus prior to a
42
Except citizens of Greece and Turkey (when it eventually becomes a member). According to the
Comprehensive settlement, Greek citizens will be able to make up a maximum of 10 per cent of the number of
resident Cypriot citizens who hold the internal component state citizenship status of the Greek Cypriot
component state and the same condition applies to the Turkish national vis-à-vis the Turkish Cypriot
component state (see Article 2 of Attachment 5 “Law on Aliens, Immigration and Asylum” in Draft Annex III
of the Foundation Agreement).
104
solution may allow for concessions to be drawn in this area thereby increasing the
viability of any solution43
.
The desirability of avoiding derogations to the freedom of establishment does
not, of course, exclude the possibility of temporary derogations in this area.
Temporary derogations from the application of the rules or, in other words,
extensions in the time period allowed for transition to new rules may be desirable in
themselves so as to allow for the gradual adjustment of individuals’ expectations. In
the particular context discussed here, temporary derogations may moreover, help
maintain the Turkish Cypriot’s sense of security. Unfortunately, rather than
envisaging a temporary derogation to the freedom of establishment with an explicit
“expiry date”, the Comprehensive settlement includes a proviso that the 28 per cent
ceiling placed on the freedom of establishment will be reviewed no later than 25
years after the reunification of the island.
THE EU AS A SOURCE OF SYMBOLIC UTILITY
AND THE LOGIC OF APPROPRIATENESS
Individuals may act to define what they are in a way they find desirable, that is, in
return for “symbolic utility” (Nozick, 1989). In the particular case of ethnicity, they
may find their identification with their ethnic group desirable basically because of a
need to transform the contingency of their finite life into the continuity which comes
from the relative immortality of the group (Pagano, 1995). In this sense, nationalism
43
To this end, the Greek Cypriot side could arguably make use of what has been called “the community trap”
(Schimmelfennig, 2001). Applied here, the basic idea is that the Greek Cypriot side – from the relative security
that membership would afford it – could expose inconsistencies between, on the one hand, the readiness of the
EU to accept indefinite restrictions to fundamental rights and freedoms in the context of a solution and, on the
other, its own founding principles and its explicit policy with regards to all new members that any derogations
from the acquis communautaire be limited and temporary in nature. In short, the EU could find itself
rhetorically entrapped.
105
has a strong affinity with religion. Indeed, the crisis of both religion and Marxism
may have potentially favored the reemergence of nationalism44
.
One way to limit the excesses of nationalism is by supplying alternative
means of obtaining symbolic utility, such as for example the ecological movement as
a source of satisfaction from saving the world (Pagano, 1995). For my purposes here
it is probably worth suggesting that to the extent that a pluralist and ethnically
diverse EU can be perceived as an alternative source of symbolic utility, it may
reduce the intensity of ethnocentrism over time and so make a positive contribution
to the viability of a reunified Republic of Cyprus. A similar point has been made by
Peristianis (1998) who argues that Cyprus’s accession to the EU may foment the
gradual incorporation into its people’s identity of the liberal/democratic values upon
which the Union is based (including the resolution of internal conflict by peaceful
means, tolerance and respect for civil rights).
Membership of the EU may have a mitigating effect on ethnocentric behavior
for another related reason stemming from what March and Olsen (1989) have called
the “logic of appropriateness”. The basic idea is that individuals associate specific
action with specific situations by rules of appropriateness. What is appropriate is
defined by political and social institutions and transmitted through socialization. In
this context then the liberal/democratic values which frame acceptable or appropriate
behavior in the EU are likely to condition the behavior of Cypriots in a reunified
Cyprus. Outright ethnocentric or communal-based behavior is likely to run against
what is considered appropriate in the EU and this may help mitigate such behavior
through time. On the other hand, insofar as the EU accommodates indefinite
derogations to its founding principles in the context of a solution to the Cyprus
problem then this is likely to undermine its capacity to frame what is appropriate or
acceptable behavior45
.
44
The concept of symbolic utility is consistent with Anderson's (1983) view of the nation as an "imagined
community". 45
The logic of appropriateness also drives the concept of the “community trap” previously discussed.
106
CHAPTER 6.
CONCLUSIONS
The analysis contained in the previous pages has brought to light numerous insights
which, arguably, should be taken into consideration by those who desire the
foundation of a viable reunified Cypriot Republic. I will end this monograph by
bringing together the most important institutional implications reached and I will do
so by reference to the Set of ideas and the Comprehensive settlement and on the
basis of those factors identified as influencing the viability of any solution. In
particular, the viability of a reunified Cyprus is likely to be increased by an
institutional structure which: minimizes the likelihood of the tyranny of the minority
by the majority and vice versa; provides effective security guarantees in the case of a
breakdown in inter-ethnic cooperation; is perceived as fair by both parties to the
conflict; out-competes informal rules coordinating intra-ethnic cooperation to the
detriment of the inter-ethnic kind and; which allows for the effective judicial
enforcement and legislative maintenance of the rules of the game.
The viability of any solution to the conflict is likely to be increased insofar as
the constitutional structure adopted can minimize the risk of the tyranny of the
minority (majority) by the majority (minority) emerging. The constitutional
provisions envisaged by the Set of ideas may in the long run be more effective than
those envisaged in the Comprehensive settlement in protecting the Turkish Cypriot
minority from the political dominance of the Greek Cypriot majority at the common
state level since the former adopts bicommunalism as a source of political rights
while the latter adopt the more fluid concept of territorial-based internal citizenship.
On the other hand, by abandoning the executive approval and veto powers envisaged
by the Set of ideas, the Comprehensive settlement reduces the capacity of the Turkish
Cypriot minority to tyrannize the Greek Cypriot majority. The Comprehensive
settlement also reduces the likelihood of such tyranny emerging since it avoids the
107
institution of a major program of action “to correct the economic imbalance and
ensure economic equilibrium between the two communities”, a program recall that is
instituted by Paragraph 86 of the Set of ideas and that provides an incentive to the
Turkish Cypriot minority to hold out, as a block, for redistributive gains. Both UN
proposals institute majority rule across both Chambers of the legislature and this
reduces the chances that a majority composed of both Greek and Turkish Cypriots
may be tyrannized by virulent minorities from either ethnic group that reject the very
idea of a reunified Cyprus. Finally, a reunified Cyprus as an EU member is likely to
be a more viable entity under either UN proposal since the EU’s Constitution
provides additional safeguards against majority tyranny of the minority by increasing
the cost of such actions, reducing the policy discretion of the central government of a
reunified Cyprus and accommodating decentralized collective decision-making.
With respect to the need to provide effective security guarantees, my analysis
leads me to favor the demilitarization of the island and the presence of an
international force with a clear and credible mandate to deal decisively with violent
peace-threatening behavior by members of either community. My analysis does not
support the institution of a unilateral right of intervention from other states.
Regardless of the organization which undertakes to provide these security guarantees
(UN, NATO, EU), I have argued that it is important to offer an explicit commitment
to provide security in the event of a settlement so as to facilitate its attainment. If the
EU where to play such a role this would mean adopting a firm commitment to do so,
as an integral part of its pre-accession strategy. Both the Set of ideas and the
Comprehensive settlement speak of the demilitarization of a reunified Cyprus but at
the same time both proposals also enshrine the continuing application of the Treaties
of Alliance and Guarantee in the context of a solution. The Comprehensive
settlement explicitly foresees the presence of a UN peacekeeping operation to
monitor implementation and this force is likely to have first go in restoring the ‘state
of affairs’ agreed to in the case of a break-down in inter-ethnic cooperation. The
proposal is silent on the decision-making mechanisms under which the UN force
108
might respond to violent non co-operative behavior by either ethnic group. To the
extent that these mechanisms are such that the credibility of the force is compromised
then this increases the likelihood of unilateral intervention if inter-ethnic cooperation
breaks down.
The direct relationship between the perceived fairness of a solution and its
viability points to the importance of securing open and explicit agreement from the
members of both the Greek and Turkish Cypriot communities. By contemplating the
holding of referendums by both communities for the approval of the solution agreed
to, both UN proposals would, other things being equal, have a better chance of being
viable than the 1960 agreements which did not seek such approval. This said, the
Comprehensive settlement would require Cypriots to accept both the Comprehensive
settlement and Cyprus’s accession to the EU simultaneously. Such full-line forcing is
likely meant to increase the likelihood of a yes vote from a majority but it would do
so at the cost of reducing the perceived legitimacy of the agreed upon solution
compared to that legitimacy which would emerge if referendums on the solution and
EU accession were to be held separately.
The analysis moreover suggests that the foundation of a confederal Cyprus by
way of the prior international recognition of the “TRNC” is likely to be perceived as
unfair by the Greek Cypriots since what the Turkish Cypriots pretend to be their
component state in such a confederation is fruit of the relatively recent and violent
expulsion of individuals from their properties. In addition, the perceived unfairness
by Greek Cypriots of the current distribution of territorial entitlements is likely to
undermine any package deal solution which takes this distribution of entitlements as
its starting point. To date, neither the UN nor the EU have to date proved to be
effective forums through which to obtain territorial concessions from the Turkish
Cypriot side. The latest decision to invite Cyprus to join the EU independently of a
settlement and – assuming that no solution is found until then – the actual accession
of Cyprus, reinforces the Greek Cypriot side’s negotiating position and may allow for
109
concessions to be drawn in this area more in line with the demographic weight of
each community thereby increasing the viability of any solution.
Any solution which violates fundamental rights and freedoms is not likely to
be perceived as fair and this will negatively affect its viability. Both the Set of ideas
and the Comprehensive settlement explicitly foresee severe limits to the freedom of
establishment and the right of property. The feeling of unfairness which would
emanate from them would be exacerbated by the realization that all EU citizens
except displaced Greek Cypriots would be able to fully enjoy the freedom of
establishment in the Turkish Cypriot federated or component state. The EU’s
willingness to accommodate such restrictions is surely motivated by the desire to
facilitate a solution such that a reunified island can accede to the Union but it comes
at a cost of foregoing the opportunity to push for a solution which avoids such
derogations. On the other hand, the decision to invite Cyprus to join the Union
regardless of a settlement and even more so the actual accession of Cyprus prior to a
solution may allow for concessions to be drawn in this area thereby increasing the
viability of any solution.
The viability of any solution is likely to be increased insofar as the institutions
agreed to can undermine the continuing influence of informal rules which may be
inimical to inter-ethnic cooperation. One desirable feature here is the non-
discriminatory enforcement of property rights and civil law in general by ethnically
neutral institutions. Both UN proposals assign enforcement authority in these areas to
the federated or component state and as such forego these possible benefits. A second
desirable feature is the provision of some minimum agreed-to level of welfare
protection taking as the basis of entitlement some non-ethnic criterion such as
relative income.
The agreed upon solution could be more effectively enforced by a
Constitutional Court which adopts the civil-law practice of issuing a single opinion
(rather than the common law one of dissenting opinions) and which moreover is
composed by at least three members from each community to facilitate the
110
emergence of a moderate majority when decisions are being taken. The Supreme
Court envisaged by the Comprehensive settlement satisfies these requirements. The
agreed upon solution could, moreover, be maintained by a compound republic of
countervailing constitutional guardians and in particular by a federal and bicameral
system which observes the separation of powers. Both UN proposals are consistent
with this and moreover require that the Constitution can only be amended either with
the approval of both federated states (Set of ideas) or after amendments have been
adopted by both Chambers of Parliament and approved by separate majority of the
people in each component state (Comprehensive settlement) something which gives
each federated or common state a veto and provides a powerful tool in favor of the
status quo situation established by any mutually accepted settlement of the Cyprus
Problem.
I will end this monograph by reiterating the main merits of an alternative
institutional proposal which I have argued is superior to those put forward by the UN.
In particular I have advocated the adoption of a functional and bicommunal
federation. Being federal in nature such a system can enhance the viability of a
federal Republic by reducing the likelihood of a permanently disaffected minority
emerging. By having a functional and not a territorial basis however, it can avoid
violating the right of property as well as avoid putting up formal barriers to the
freedom of establishment and the right to vote and, as such, it can accommodate the
voluntary return of all displaced persons to their homes and allow them to exercise
their voting rights once there. This would increase the perceived fairness of a solution
and thus its viability. It would also avoid the need for a reunified Cyprus as a
member of the EU to derogate from principles which are fundamental to the Union.
A functional federation is by definition inconsistent with a bizonal solution but it can
accommodate bicommunalism. While bicommunalism can protect the group rights of
the Turkish Cypriot minority it may undermine inter-ethnic co-operation over time.
To avoid this the crux of the system could be preserved but electoral rules could be
111
engineered so as not to hinder the emergence of inter-ethnic political cooperation in
the future.
112
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ANNEX A.
THE 1992 UNITED NATIONS SET OF IDEAS
ON AN OVERALL FRAMEWORK AGREEMENT ON CYPRUS
1. The leader of the Greek Cypriot community and the leader of the Turkish Cypriot
community have negotiated on an equal footing, under the auspices of the mission of good
offices of the Secretary-General, the following overall framework agreement on Cyprus
which constitutes a major step towards a just and lasting settlement of the Cyprus question.
The overall framework agreement will be submitted to the two communities in separate
referendums within thirty days of its completion by the two leaders at a high-level
international meeting.
I. OVERALL OBJECTIVES
2. The overall framework agreement is an integrated whole which, when it is approved by
both communities in separate referendums and the provisions contained in the transitional
arrangements have been implemented, will result in a new partnership and a new
constitution for Cyprus that will govern the relations of the two communities on a federal
basis that is bi-communal as regards the constitutional aspects and bi-zonal as regards the
territorial aspects. The overall framework agreement is based on the 1977 and 1979 high-
level agreements, relevant United Nations resolutions, in particular Security Council
resolutions 367 (1975), 649 (1990), 716 (1991) and 750 (1992), and the guiding principles
set out below.
3. The overall framework agreement recognizes that Cyprus is the common home of the
Greek Cypriot community and of the Turkish Cypriot community and that their relationship
is not one of majority and minority but one of two communities in the federal republic of
Cyprus. It safeguards the cultural, religious, political, social and linguistic identity of each
community.
4. The overall framework agreement ensures that the Cyprus settlement is based on a State
of Cyprus with a single sovereignty and international personality and a single citizenship,
with its independence and territorial integrity safeguarded, and comprising two politically
equal communities as defined in paragraph 11 of the Secretary General's report of 3 April
1992 (S/23780) in a bi-communal and bi-zonal federation, and that the settlement must
exclude union in whole or in part with any other country or any form of partition or
secession.
5. The overall framework agreement acknowledges and ensures the political equality of the
two communities. While political equality does not mean equal numerical participation in all
branches and administration of the federal government, it will be reflected in the fact that the
approval and amendment of the federal constitution will require the approval of both
119
communities; in the effective participation of both communities in all organs and decisions
of the federal government; in safeguards to ensure that the federal government will not be
empowered to adopt any measures against the interests of one community; and in the
equality and identical powers and functions of the two federated states.
6. The overall framework agreement provides for functions and powers of the federal
government, including its structure, composition and functioning of its three branches, that
will ensure the effective participation of the two communities and the effective functioning
of the federal government, which will require an appropriate deadlock-resolving machinery.
7. The two communities acknowledge each other's identity and integrity, and commit
themselves to work actively to achieve a new relationship based on mutual respect,
friendship and co-operation. Toward this end, the two communities agree to change all
practices incompatible with this commitment and to refrain from any action which would
impair the efforts for a negotiated settlement. They pledge to launch immediately a
programme of action to promote goodwill and closer relations between them (see appendix).
II. GUIDING PRINCIPLES
8. The bi-communal and bi-zonal federation will be established freely by the Greek Cypriot
and Turkish Cypriot communities. All powers not vested by them in the federal government
will rest with the two federated states.
9. The federal constitution will come into force after its approval by the two communities in
separate referendums and can only be amended with the approval of both federated states.
10. The federal republic will be one territory composed of two politically equal federated
states.
11. The federal republic will have one sovereignty which is indivisible and which emanates
equally from the Greek Cypriot and Turkish Cypriot communities. One community cannot
claim sovereignty over the other community. The federal republic will have one
international personality and one citizenship regulated by federal law in accordance with the
federal constitution.
12. The federal constitution will safeguard the identity, integrity and security of each
community as well as their political, economic, social, cultural, linguistic and religious
rights. All citizens will be equal under the law.
13. The federal republic will be secular. Religious functionaries will be prohibited from
holding elected or appointed political office in the federal government or in the federated
states.
14. The federal republic will maintain special ties of friendship with Greece and Turkey and
will accord most favoured nation treatment to Greece and Turkey in connection with all
120
agreements whatever their nature. The federal republic will continue the membership in the
Commonwealth.
15. The official languages of the federal republic will be Greek and Turkish. The English
language may also be used.
16. The federal republic will have its own flag to be agreed upon. The federal flag will be
flown on federal buildings and federal locations to the exclusion of all other flags. Each
federated state will have its own flag.
17. The holidays to be observed by the federal government will be agreed upon and
embodied in the federal constitution. Each federated state will observe the federal holidays
as well as those established by it.
18. The two federated states will have identical powers and functions.
19. Each federated state will be administered by one community.
20. Each federated state will decide on its own governmental arrangement in a manner
consistent with the federal constitution.
21. The federal Government cannot encroach upon the powers and functions of the two
federated states.
22. Security, law and order and the administration of justice in its territory will be the
responsibility of each federated state in a manner consistent with the federal constitution.
23. The two federated states will cooperate in the preservation and / or use of historical sites
and religious shrines of both faiths to be agreed to during the transitional period.
III. CONSTITUTIONAL ASPECTS OF THE FEDERATION
24. The powers, functions and structure of the federal Government will be in conformity
with the overall objectives and guiding principles set out above.
A. Powers and functions to be vested in the federal Government
25. The federal Government will have the powers and functions listed below. All powers
and functions not vested in the federal Government will rest with the two federated states.
The federated states may decide jointly to confer additional powers and functions to the
federal Government or to transfer powers and functions from the federal Government to the
federated states.
26. The federal Government will have the following powers and functions:
121
(a) Foreign affairs (the federated states may enter into agreements with foreign Governments
and international organizations in their areas of competence. The representation in foreign
affairs will reflect the bi-communal nature of the federal republic);
(b) Central bank functions (including the issuance of currency);
(c) Customs and the coordination of international trade;
(d) Airports and ports as concerns international matters;
(e) Federal budget and federal taxation;
(f) Immigration and citizenship;
(g) Defense (to be discussed also in connection with the Treaties of Guarantee and of
Alliance);
(h) Federal judiciary and federal police;
(i) Federal postal and telecommunications services;
(j) Patents and trademarks;
(k) Appointment of federal officials and civil servants (on a 70:30 Greek Cypriot/Turkish
Cypriot ratio);
(l) Standard setting for public health, environment, use and preservation of natural resources,
and weights and measures;
(m) Coordination of tourism and industrial activities.
27. The federal powers and functions will be executed by the federal Government or, in
accordance with agreements, through delegation to the federated states.
B. Structure, composition and functioning of the federal Government
1. The Legislature
28. The legislature will be composed of a lower house and an upper house. The presidents of
the lower house and of the upper house cannot come from the same community. The
president and vice-president of each house will not come from the same community.
29. All laws must be approved by both houses.
30. The lower house will be bi-communal with a 70:30 Greek Cypriot / Turkish Cypriot
ratio.
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31. The upper house will have a 50:50 ratio representing the two federated states.
32. All laws will be adopted by majority in each house. A majority of the Greek Cypriot or
Turkish Cypriot representatives in the lower house may decide, on matters related to foreign
affairs, defence, security, budget, taxation, immigration and citizenship, that the adoption of
a law in the lower house will require separate majorities of the representatives of both
communities.
33. Separate Greek Cypriot and Turkish Cypriot majorities will be required to constitute a
quorum in each house. If a quorum is not attained in either house on two consecutive
meetings because of the absence of a majority of one or both communities, the president of
the relevant house will call a meeting in no less than five days and no more than ten days. At
that meeting, a majority of the upper house will constitute a quorum. In the lower house,
30% of the total membership will constitute a quorum.
34. If the two houses fail to adopt a bill or decision, they will initiate proceedings to obtain a
consensus while ensuring the continued functioning of the federal government. To this end,
a conference committee will be established. The conference committee will be composed of
two persons each selected by the Greek Cypriot and Turkish Cypriot groups equally from
among the members of the two houses of the federal legislature. The text of the legislation
or decision agreed to by the conference committee will be submitted to both houses for
approval.
35. In the event the federal budget is not adopted in one or both houses and until an
agreement is reached by the conference committee and is adopted by both houses, the
provisions of the most recent federal budget plus inflation shall remain in effect.
2. The Executive
36. The federal executive will consist of a federal president, a federal vice-president, and a
federal council of ministers. The president and the vice president will symbolize the unity of
the country and the political equality of the two communities.
(On the question of the election of the president and vice-president, the two sides have
expressed different positions. The Greek Cypriot side prefers a system under which the
president is elected by popular universal suffrage. The Turkish Cypriot side prefers a system
under which the president rotates between the two communities).
37. To facilitate the effective launching of the federal government and for the initial eight
years, the president and vice-president will also be the heads of their respective federated
states.
38. There will be a council of ministers composed of Greek Cypriot and Turkish Cypriot
ministers on a 7:3 ratio. The president and vice-president will designate the ministers from
their respective communities who will appoint them by an instrument signed by them both.
One of the following three ministries, that is foreign affairs, finance, or defence, will be
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allocated to a Turkish Cypriot minister. The president and the foreign minister will not come
from the same community.
39. The president and the vice-president will discuss the preparation of the agenda of the
council of ministers and each can include items in the agenda.
40. Decisions of the council of ministers will be taken by majority vote. However, decisions
of the council of ministers concerning foreign affairs, defence, security, budget, taxation,
immigration and citizenship will require the concurrence of both the president and the vice-
president.
41. Arrangements related to the implementation of foreign policy and the composition of the
foreign service will be set out in the federal constitution.
42. The president and the vice-president will, separately or conjointly, have the right to veto
any law or decision of the legislature concerning foreign affairs, defence, security, budget,
taxation, immigration and citizenship. The president and vice-president will have the right,
separately or conjointly, to return any law or decision of the legislature or any decision of
the council of ministers for reconsideration.
3. The Judiciary
43. The federal judiciary will consist of a supreme court composed of an equal number of
Greek Cypriot and Turkish Cypriot judges appointed jointly by the president and vice-
president with the consent of the upper house. The supreme court will sit as the federal
constitutional court and the highest court of the federation. Its presidency will rotate between
the senior Greek Cypriot and Turkish Cypriot members of the supreme court. Lower federal
courts may be established in each federated state.
44. The supreme court will deal with matters arising under the federal constitution and
federal laws, and will be empowered to fulfil other judiciary functions related to federal
matters attributed to it by the federal constitution or federal legislation.
45. Each federated state will have its own judiciary to deal with matters not attributed to the
federal judiciary by the federal constitution.
46. The federal constitution will establish the procedure for ascertaining the constitutionality
of federal laws and executive acts, as well as adequate machinery of judicial review to
ensure the compliance of legislative, executive, and judicial acts of the federated states with
the federal constitution.
C. Fundamental rights, including the three freedoms, and political, economic, social,
and cultural rights
47. All universally recognised fundamental rights and freedoms will be included in the
federal constitution.
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48. The freedom of movement, the freedom of settlement and the right to property will be
safeguarded in the federal constitution. The implementation of these rights will take into
account the 1977 high-level agreement and the guiding principles set out above.
49. The freedom of movement will be exercised without any restrictions as soon as the
federal republic is established, subject only to non-discriminatory normal police functions.
50. The freedom of settlement and the right to property will be implemented after the
resettlement process arising from the territorial adjustments has been completed. The
federated states will regulate these rights in a manner to be agreed upon during the
transitional period consistent with the federal constitution.
51. Persons who are known to have been or are actively involved in acts of violence or in
incitement to violence and/or hatred against persons of the other community may, subject to
due process of law, be prevented from going to the federated state administered by the other
community.
IV. SECURITY AND GUARANTEE
52. The security of the federal republic and of the Greek Cypriot and Turkish Cypriot
federated states will be guaranteed.
53. The demilitarization of the federal republic remains an objective.
54. The 1960 Treaties of Guarantee and of Alliance continue in force and will be
supplemented in a document to be appended as set out below.
55. The Treaty of Guarantee will ensure the independence and territorial integrity of the
federal republic and exclude union in whole or in part with any other country and any form
of partition or secession; ensure the security of the Greek Cypriot and the Turkish Cypriot
federated states; and ensure against the unilateral change of the new constitutional order of
the federal republic by either community.
56. A numerical balance of Greek and Greek Cypriot troops and equipment on the one hand
and of Turkish and Turkish Cypriot troops and equipment on the other hand will be achieved
within ______ months after the overall framework agreement has been approved by the two
communities in separate referendums.
57. A timetable will be established for the further reduction to an agreed level of the Greek
Cypriot and the Turkish Cypriot units and for the withdrawal of all non-Cypriot forces not
provided for under the Treaty of Alliance. This timetable will be fully implemented prior to
the establishment of the federal republic and in phases parallel to the implementation of the
programme of action set out in annex.
58. The Treaty of Alliance will provide for the stationing in Cyprus of Greek and Turkish
contingents of equal size and equipment not exceeding ______ persons each. The Greek
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contingent will be stationed in the federated state administered by the Greek Cypriot
community and cannot enter the federated state administered by the Turkish Cypriot
community. The Turkish contingent will be stationed in the federated state administered by
the Turkish Cypriot community and cannot enter the federated state administered by the
Greek Cypriot community.
59. The federal republic will maintain a federal force consisting of a Greek Cypriot and a
Turkish Cypriot unit of equal size and equipment not exceeding the size of the Greek and
Turkish contingents, under the joint overall command of the president and the vice-
president. The Greek Cypriot unit will be stationed in the federated state administered by the
Greek Cypriot community. The Turkish Cypriot unit will be stationed in the federated state
administered by the Turkish Cypriot community. The president and the vice-president will
jointly decide on the locations of the units.
60. There will not be any reserve force and any military or paramilitary training of civilian
groups.
61. The Greek Cypriot and Turkish Cypriot units will promote mutual respect, friendship,
and closer relations between the two communities and foster their welfare by carrying out
joint social service activities throughout the federal republic.
62. Each federated state and the federal republic will have a police force. All paramilitary
activities and the ownership of weapons other than those licensed for hunting will be
outlawed throughout the federal republic and any infraction will be a federal offense. The
importation or transit of weapons and other military equipment other than that duly
approved by the federal government will be prohibited.
63. Immediately after the approval of the overall framework agreement by the two
communities in separate referendums, an interim monitoring committee will be established
composed of the three guarantor powers, the two communities and the United Nations
Peace-keeping Force in Cyprus (UNFICYP) which will be responsible for:
(a) Monitoring the achievement of the agreed numerical balance of Greek and Greek Cypriot
troops and equipment on the one hand and Turkish and Turkish Cypriot troops and
equipment on the other hand to be implemented within ______ months after the overall
framework agreement has been approved by the two communities in separate referendums;
(b) Monitoring the achievement of the agreed timetable for the further reduction to the
agreed level of Greek Cypriot and Turkish Cypriot units and the withdrawal of all non-
Cypriot forces not provided for in the Treaty of Alliance prior to the establishment of the
federal republic.
64. The Treaty of Guarantee, in a manner consistent with the principles of the Conference on
Security and Co-operation in Europe (CSCE), with which the federal republic will affirm its
commitment, will provide for a supervision and verification committee comprising
representatives of the guarantor powers and of the federal president and federal vice-
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president. The United Nations will provide the support personnel to assist the supervision
and verification committee in carrying out its functions.
65. The supervision and verification committee will be responsible for investigating any
development which in the view of either the federal president or federal vice-president or
any guarantor power is a threat to the security of either community or of the federal republic
through on-site inspection and other methods the supervision and verification committee
deems necessary. The supervision and verification committee will make recommendations
for rectifying any situation it has established to be in contravention of the arrangements
covered by the Treaties of Guarantee and of Alliance. The parties will be obligated to
implement these recommendations promptly and in good will.
66. The United Nations Security Council will be requested to revise the mandate of
UNFICYP, including support of the supervision andverification committee.
V. TERRITORIAL ADJUSTMENTS
67. The Greek Cypriot and Turkish Cypriot communities agree on the territories of the
federated states administered by each, taking into account the 1977 high-level agreement.
68. The map attached hereto sets out the territories of the two federated states. The territorial
agreement shall be respected and will be included in the federal constitution.
69. Persons affected by the territorial adjustments will have the option of remaining in the
area concerned or relocating to the federated state administered by their own community.
70. All necessary arrangements for the relocation of persons affected by territorial
adjustments will be satisfactorily implemented before resettlements are carried out. The fund
to be established related to displaced persons will be available for this purpose.
71. The territorial adjustment will not affect the water resources available to each federated
state. The water resources available throughout the federation will be allocated to the two
federated states at a proportion at least equal to their respective current demand.
VI. DISPLACED PERSONS
72. The property claims of Greek Cypriot and Turkish Cypriot displaced persons are
recognized and will be dealt with fairly on the basis of a time-frame and practical
regulations based on the 1977 high-level agreement, on the need to ensure social peace and
harmony, and on the arrangements set out below.
A. Areas that will come under Greek Cypriot administration
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73. The first priority will be given to the satisfactory relocation of and support for Turkish
Cypriots living in the area that will come under Greek Cypriot administration and to
displaced persons returning to that area.
74. Turkish Cypriots who in 1974 resided in the area that will come under Greek Cypriot
administration will have the option to remain in their property or to request to receive a
comparable residence in the area that will come under Turkish Cypriot administration.
Turkish Cypriot displaced persons currently residing in the area that will come under Greek
Cypriot administration will have the option to receive comparable residence in that area, to
return to their former residence, or to receive a comparable residence in the area that will
come under Turkish Cypriot administration.
75. A bi-communal committee will be established immediately after the overall framework
agreement has been approved in the referendums to arrange for suitable housing for all
persons affected by the territorial adjustments.
B. Other areas under Greek Cypriot and Turkish Cypriot administration
76. Each community will establish an agency to deal with all matters related to displaced
persons.
77. The ownership of the property of displaced persons, in respect of which those persons
seek compensation, will be transferred to the ownership of the community in which the
property is located. To this end, all titles of properties will be exchanged on a global
communal basis between the two agencies at the 1974 value plus inflation. Displaced
persons will be compensated by the agency of their community from funds obtained from
the sale of the properties transferred to the agency, or through the exchange of property. The
shortfall in funds necessary for compensation will be covered by the federal Government
from a compensation fund obtained from various possible sources such as windfall taxes on
the increased value of transferred properties following the overall agreement, and savings
from defense spending. Governments and international organizations will also be invited to
contribute to the compensation fund. In this connection, the option of long-term leasing and
other commercial arrangements may also be considered.
78. Persons from both communities who in 1974 resided and / or owned property in the
federated state administered by the other community or their heirs will be able to file
compensation claims. Persons belonging to the Turkish Cypriot community who were
displaced after December 1963 or their heirs may also file claims.
79. Current permanent residents of Cyprus who at the time of displacement owned their
permanent residence in the federated state administered by the other community and who
wish to resume their permanent residence at that location may also select the option to
return.
80. Current permanent residents of Cyprus who at the time of displacement rented their
permanent residence in the federated state administered by the other community and who
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wish to resume their permanent residence in that area will be given priority under the
freedom of settlement arrangements.
81. All claims must be filed within six months after the approval of the overall framework
agreement.
82. ______ thousand displaced persons who elect to return to their former permanent
residence will be processed by the federated state concerned each year for ______ years. In
addition, Maronites who in 1974 had their permanent residence in the federated state under
the administration of the Turkish Cypriot community may elect to return to their properties.
The two federated states will review the situation at the conclusion of the above mentioned
period in the light of the experience gained.
83. This period will begin after the resettlement and rehabilitation process arising from
territorial adjustments are essentially completed.
84. The settlement of those who select to return will take place after the persons who will be
affected have been satisfactorily relocated. If the current occupant is also a displaced person
and wishes to remain, or if the property has been substantially altered or has been converted
to public use, the former permanent resident will be compensated or will be provided an
accommodation of similar value.
85. Persons who are known to have been actively or are actively involved in acts of violence
or incitement to violence and / or hatred against persons of the other community may,
subject to due process of law, be prevented from returning to the federated state
administered by the other community.
VII. ECONOMIC DEVELOPMENT AND SAFEGUARDS
86. A priority objective of the federal republic will be the development of a balanced
economy that will benefit equally both federated states. A major programme of action will
be established to correct the economic imbalance and ensure economic equilibrium between
the two communities through special measures to promote the development of the federated
state administered by the Turkish Cypriot community. A special fund will be established for
this purpose. Foreign Governments and international organizations will be invited by the
Security Council to contribute to this fund.
87. To help promote a balanced economy, persons may be employed throughout the federal
republic at equal pay.
88. To protect in particular the federated state administered by the Turkish Cypriot
community, special measures and safeguards will be adopted to avoid adverse economic
effects resulting from the establishment of the federal republic, for example as a result of the
adoption of one currency and the establishment of one customs frontier.
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89. Each federated state may, in addition to federal taxation, establish and administer its own
tax regime and determine tax rates in line with its economic objectives and needs.
90. In line with annex F, part II, of the Treaty of Establishment, the federal republic will
accord most favoured nation treatment to Greece and Turkey in connection with all
agreements whatever their nature.
91. A bi-communal committee will be established as part of the transitional arrangements to
prepare the special programmes and measures envisaged above prior to the establishment of
the federal republic. The United Nations Development Programme (UNDP) will provide the
committee with support. The committee may request other expert assistance as required.
92. Matters related to the membership of the federal republic in the European Economic
Community will be discussed and agreed to, and will be submitted for the approval of the
two communities in separate referendums. (This paragraph relates exclusively to
arrangements that might be put in place in Cyprus and in no way impinges upon the
prerogatives of the European Community and its member states in matters concerning
membership in the Community).
VIII. TRANSITIONAL ARRANGEMENTS
93. Immediately after the approval in separate referendums of the overall framework
agreement on Cyprus, the following transitional arrangements will be carried out to
implement the overall framework agreement, including the preparation and putting into
force of the federal constitution. All transitional arrangements will be fully implemented in
an 18- month period.
94. In line with this overall framework agreement, bi-communal committees will be
established immediately to implement the provisions related to the preparation and putting
into force of the federal constitution and electoral law, the establishment of the federal civil
service, property settlement claims, economic development and safeguards, arrangements
related to the territorial adjustments to take effect at the time the federal republic is
established, and the programme of action set out in the appendix. Furthermore, a committee
composed of the representatives of the guarantor powers and the two communities will be
established to supplement the Treaties of Guarantee and of Alliance. The United Nations
will assist each committee in fulfilling its functions. Each side may employ foreign experts.
95. In addition, a committee composed of the leaders of the two communities and a
representative of the Secretary-General of the United Nations will be established
immediately to work out the transitional arrangements procedures foreseen herein and to
ensure that the functions of the above mentioned committees are implemented in an
effective and timely manner. Furthermore, this committee will, within 30 days of its
completion by the two leaders at a high-level international meeting, organize separate
referendums to approve the overall framework agreement, and, at the appropriate time
during the transitional period, organize separate referendums to approve the federal
constitution and the elections of federal officials with the assistance of and verification by
the United Nations.
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96. During the transitional period, the current arrangements for the administration of the
day-to-day internal affairs of each side will continue, unless modified by the provisions of
the overall framework agreement. In matters affecting Cyprus as a whole, such as
international trade and tourism, the same principle shall apply on the understanding that
these matters will be administered on an interim basis in the common interest. To this end,
interim procedures will be agreed to by the two communities.
97. During the transitional period, external affairs shall be conducted in a manner which
accords with the principles contained in the overall framework agreement and in consensus
with the leaders of the two communities. Arrangements shall be made for joint delegations,
in particular to international meetings.
98. The statutes, laws, regulations, rules, contracts currently in effect on both sides shall be
considered valid to the extent they are not inconsistent with the overall framework
agreement. The federal government may review prior international agreeements to
determine whether any action should be taken in respect thereto.
99. Each community will prepare its federated state constitution and electoral law in line
with the federal constitution and electoral law, and will organize its federated state
governmental arrangements which shall both come into being at the same time that the
federal republic is established.
100. The date of entry into force of the federal constitution will be specified therein and will
be the date on which the federal republic comes into being.
IX. NOTIFICATION TO THE UNITED NATIONS
101. As soon as the overall framework agreement has been approved in separate
referendums by each community, the leaders of the two communities will address a letter to
the Secretary-General of the United Nations transmitting to him the text of the overall
framework agreement with the request that he submit the letter and the overall framework
agreement to the Security Council so that the Council may take note of the decision of the
two communities to establish a federal republic in the manner described in the overall
framework agreement.
Appendix
As soon as the overall framework agreement has been approved by the two communities in
separate referendums the following programme of action to promote goodwill and close
relations between the two communities will be implemented.
1. The flow of persons and goods, services, capital, communication, and international
assistance from and / or to Cyprus will take place on an equal basis throughout Cyprus and
any restrictions to the contrary will be lifted.
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2. All restrictions on travel by members of the Turkish Cypriot community will be lifted.
The two communities will agree on interim procedures.
3. The restrictions on the movement of tourists will be lifted.
4. Objections to the participation in international sport and cultural activities will be lifted.
5. The freedom of movement will be facilitated subject, by way of agreement between the
two communities, only to minimal procedures.
6. Pending the establishment of the federal republic, Varosha will be placed under United
Nations administration and a programme of action for its restoration will be prepared and
implemented.
7. All military modernization programmes and strengthening of positions will cease. The
two sides will cooperate with UNFICYP in extending the unmanning of positions along the
buffer zone to all areas where the troops of both sides remain in close proximity to each
other. The freedom of movement of UNFICYP throughout Cyprus will be ensured.
8. A bi-communal committee will be established to review the textbooks used in schools on
each side and make recommendations for the removal of material that is contrary to the
promotion of goodwill and close relations between the two communities. The committee
may also recommend positive measures to promote that objective.
9. Both communities will promote goodwill and close relations between them and friendly
relations with Greece and Turkey.
10. Both communities will, within the limits of their authority, terminate all current or
pending recourse before an international body against the other community or Greece or
Turkey.
11. A bi-communal committee will be established to survey the water situation in Cyprus
and make recommendations on ways of meeting the water needs of Cyprus, including from
external sources. The committee may request expert assistance as required.
12. A bi-communal committee will be established to prepare and launch a programme of
action for the restoration of historical and religious sites throughout Cyprus. The committee
may request expert assistance as required.
13. A bi-communal committee will be established to undertake a population census of both
communities. The committee may request expert assistance as required.
14. The two communities undertake to support the efforts of the Committee on Missing
Persons to reach early conclusions wherever possible on the fate of the missing persons. To
this end, the Committee is requested to undertake without delay the investigation of all cases
of missing persons and, to this end, to reassess the criteria for arriving at conclusions on the
fate of the missing.
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ANNEX B.
COMPREHENSIVE SETTLEMENT OF THE CYPRUS PROBLEM
(Revised version)
We, the democratically elected leaders of the Greek Cypriots and the Turkish Cypriots,
through negotiations under the auspices of the Secretary-General of the United Nations in
which each side represented itself, and no-one else, as the political equal of the other, have
freely agreed to settle the Cyprus Problem in all its aspects in the following comprehensive
manner:
Article 1 Foundation Agreement
1. The main articles of the appended Foundation Agreement are hereby agreed, as is the
substance of the specially marked parts of the Annexes thereto and the map delineating the
boundary between the <component states>. The Draft Annexes as a whole are hereby
accepted as a basis for agreement to be finalized no later than 28 February 2003.
2. The finalization of all Draft Annexes shall be accompanied and facilitated by the
appended measures.
3. The Secretary-General is invited to certify the results of the finalization process, and to
include his suggestions, if any are indispensable, to finalize the Agreement.
4. That finalized Foundation Agreement shall be submitted by each side to referendum on 30
March 2003, together with other specified matters related to the coming into being of the
new state of affairs, including accession to the European Union.
5. Should the Foundation Agreement not be approved at the separate simultaneous
referenda, it shall be null and void, and the commitments undertaken in this Comprehensive
Settlement shall have no further legal effect.
Article 2 Treaty on matters related to the new state of affairs in Cyprus
Upon entry into force of the Foundation Agreement, the Co-Presidents of Cyprus shall, on
invitation and in the presence of the Secretary-General of the United Nations (or his
representative), sign the appended Treaty with Greece, Turkey and the United Kingdom,
which shall be registered as an international treaty in accordance with Article 102 of the
Charter of the United Nations.
Article 3 Matters to be submitted to the United Nations Security
Council for decision The Secretary-General of the United Nations is invited to request the
Security Council to take decisions as appended.
Article 4 Conditions of accession to the European Union
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Pursuant to the willingness of the European Union to accommodate the terms of a
comprehensive settlement and to assist its implementation, as expressed in the conclusions
of the Brussels European Council of 24 and 25 October, the requests to the European Union
to attach the appended Protocol to the Act concerning the conditions of accession of Cyprus
to the European Union, and to include the appended paragraph in the conclusions of the
Copenhagen European Council, are hereby agreed.
Glafcos Clerides Rauf Denktash
For the Greek Cypriot side For the Turkish Cypriot side
***
The Hellenic Republic, the Republic of Turkey, and the United Kingdom of Great Britain
and Northern Ireland hereby agree with this Comprehensive Settlement of the Cyprus
Problem, and commit themselves to sign together with Cyprus the appended Treaty on
matters related to the new state of affairs in Cyprus, which shall be registered as an
international treaty in accordance with Article 102 of the Charter of the United Nations.
Signature Signature Signature
Hellenic Republic United Kingdom Republic of Turkey
of Great Britain and Northern Ireland
***
Witnessed by
Kofi A. Annan
Secretary-General of the United Nations
Appendices to the Comprehensive Settlement of The Cyprus Problem:
* Appendix A: Foundation Agreement
* Appendix B: Measures to accompany and facilitate the finalization process
* Appendix C: Treaty between Cyprus, Greece, Turkey and the United Kingdom on
matters related to the new state of affairs in Cyprus
* Appendix D: Matters to be submitted to the United Nations Security Council for
decision
* Appendix E: Requests to the European Union with respect to the accession of Cyprus
to the European Union
APPENDIX A
FOUNDATION AGREEMENT
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i. Affirming that Cyprus is our common home and recalling that we were co-founders of the
Republic established in 1960
ii. Resolved that the tragic events of the past shall never be repeated and renouncing forever
the threat or the use of force, or any domination by or of either side
iii. Acknowledging each other's distinct identity and integrity and that our relationship is not
one of majority and minority but of political equality
iv. Deciding to renew our partnership on that basis and determined that this new partnership
shall ensure a common future in friendship, peace, security and prosperity in an independent
and united Cyprus
v. Underlining our commitment to international law and the principles and purposes of the
United Nations
vi. Committed to respecting democratic principles, individual human rights and fundamental
freedoms, as well as each other's cultural, religious, political, social and linguistic identity
vii. Determined to maintain special ties of friendship with, and to respect the balance
between, Greece and Turkey, within a peaceful environment in the Eastern Mediterranean
viii. Looking forward to joining the European Union, and to the day when Turkey does
likewise
ix. Welcoming the Comprehensive Settlement freely reached by our democratically elected
leaders on all aspects of the Cyprus Problem, and its endorsement by Greece and Turkey,
along with the United Kingdom
We, the Greek Cypriots and the Turkish Cypriots, exercising our inherent constitutive
power, by our free and democratic, separately expressed common will adopt this Foundation
Agreement.
Article 1 The new state of affairs
1. This Agreement establishes a new state of affairs in Cyprus.
2. The treaties listed in this Agreement bind Cyprus, and the attached <common state>
legislation indispensable for the functioning of the <common state> shall apply upon entry
into force of this Agreement.
3. The Treaty of Establishment, the Treaty of Guarantee, and the Treaty of Alliance remain
in force and shall apply mutatis mutandis to the new state of affairs. Upon entry into force of
this Agreement, Cyprus shall sign a Treaty with Greece, Turkey and the United Kingdom on
matters related to the new state of affairs in Cyprus, along with additional protocols to the
Treaties of Guarantee and Alliance.
4. Cyprus shall sign and ratify the Treaty of Accession to the European Union.
5. Cyprus shall maintain special ties of friendship with Greece and Turkey, respecting the
balance established by the Treaty of Guarantee and the Treaty of Alliance and this
Agreement, and as a European Union member state shall support the accession of Turkey to
the Union.
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6. Any unilateral change to the state of affairs established by this Agreement, in particular
union of Cyprus in whole or in part with any other country or any form of partition or
secession, is prohibited. Nothing in this Agreement shall in any way be construed as
contravening this prohibition.
Article 2 The State of Cyprus, its <common state> government, and its <component
states>
1. The status and relationship of the State of Cyprus, its <common state> government, and
its <component states>, is modeled on the status and relationship of Switzerland, its federal
government, and its Cantons. Accordingly:
a. Cyprus is an independent state in the form of an indissoluble partnership, with a
<common state> government and two equal <component states>, one Greek Cypriot and
one Turkish Cypriot. Cyprus has a single international legal personality and sovereignty and
is a member of the United Nations. Cyprus is organized under its Constitution in accordance
with the basic principles of rule of law, democracy, representative republican government,
political equality, bi-zonality, and the equal status of the <component states>.
b. The <common state> government sovereignly exercises the powers specified in the
Constitution, which shall ensure that Cyprus can speak and act with one voice
internationally and in the European Union, fulfill its obligations as a European Union
member state, and protect its integrity, borders and ancient heritage.
c. The <component states> are of equal status. Within the limits of the Constitution, they
sovereignly exercise all powers not vested by the Constitution in the <common state>
government, organizing themselves freely under their own Constitutions.
2. The <component states> shall cooperate and co-ordinate with each other and with the
<common state>, including through Cooperation Agreements, as well as through
Constitutional Laws approved by the legislatures of the <common state> and the
<component states>. In particular, the <component states> shall participate in the
formulation and implementation of policy in external and European Union relations on
matters within their sphere of competence, in accordance with Cooperation Agreements
modeled on the Belgian example. The <component states> may have commercial and
cultural relations with the outside world in conformity with the Constitution.
3. The <common state> and the <component states> shall fully respect and not infringe
upon the powers and functions of each other. There shall be no hierarchy between the laws
of the <common state> and those of the <component states>. Any act in contravention of the
Constitution shall be null and void.
4. The Constitution of Cyprus may be amended by separate majority of the voters of each
<component state>in accordance with the specific provisions of the Constitution.
Article 3 Citizenship
1. There is a single Cypriot citizenship. Special majority <common state> law shall regulate
eligibility for Cypriot citizenship.
2. All Cypriot citizens shall also enjoy internal <component state> citizenship status. Like
the citizenship status of the European Union, this status shall complement and not replace
Cypriot citizenship. A <component state> may tie the exercise of political rights at its level
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to its internal <component state> citizenship status, and may limit the establishment of
residence for persons not holding this status in accordance with this Agreement.
3. Political rights at the <component state> level shall be exercised based on internal
<component state> citizenship status. A component state may tie the exercise of political
rights at its level to its internal <component state> citizenship status.
4. During the first four years after entry into force of this Agreement, a <component state>
may establish a moratorium on the establishment of residence for persons not holding the
internal <component state> citizenship status of the relevant <component state>. Thereafter,
pursuant to Constitutional Law, a <component state> may limit the establishment of
residence for persons not holding its internal <component state> citizenship status, if the
number of residents hailing from the other <component state> has reached 8% of the
population of a village or municipality between the 5th
and 9th
years and 18% between, the
10th
and 15th
years. Thereafter, any limitations shall be permissible only if 28% of the
population of the relevant <component state> hails from the other <component state>. No
later than 25 years after entry into force of this Agreement, the <common state> and the
<component states> shall review the relevant Constitutional Law in light of experience.
Article 4 Fundamental rights and liberties
1. Respect for human rights and fundamental freedoms shall be enshrined in the
Constitution. There shall be no discrimination against any person on the basis of his or her
gender, ethnic or religious identity, or internal <component state> citizenship status.
Freedom of movement and freedom of residence may be limited only where expressly
provided for in this Agreement.
2. Greek Cypriots and Turkish Cypriots living in specified villages in the other <component
state> shall enjoy cultural and educational rights and shall be represented in the <component
state> legislature.
3. The rights of religious and other minorities, including the Maronite, the Latin and the
Armenian, shall be safeguarded in accordance with international standards, and shall include
cultural and educational rights as well as representation in <common state> and <component
state> legislatures.
Article 5 The <common state> government
1. The <common state> Parliament composed of two chambers, the Senate and the Chamber
of Deputies, shall exercise the legislative power:
a. Each Chamber shall have 48 members. The Senate shall be composed of an equal number
of Senators from each <component state>. The Chamber of Deputies shall be composed in
proportion to persons holding internal <component state> citizenship status of each
<component state>, provided that each <component state> shall be attributed no less than
one quarter of seats.
b. Decisions of Parliament shall require the approval of both Chambers by simple majority,
including one quarter of voting Senators from each <component state>. For specified
matters, a special majority of two-fifths of sitting Senators from each <component state>
shall be required.
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2. The Office of Head of State is vested in the Presidential Council, which shall exercise the
executive power:
a. The Presidential Council shall comprise six members elected on a single list by special
majority in the Senate and approved by majority in the Chamber of Deputies. The
composition of the Presidential Council shall be proportional to the number of persons
holding the internal <component state> citenship status of each <component state>, though
no less than one-third of the members of the Council must come from each <component
state>.
b. The Presidential Council shall strive to reach decisions by consensus. Where it fails to
reach consensus, it shall, unless otherwise specified, take decisions by simple majority of
members voting, provided this comprises at least one member from each <component
state>.
c. The members of the Council shall be equal and each member shall head a department. The
heads of the Departments of Foreign Affairs and European Union Affairs shall not come
from the same <component state>.
d. The offices of President and Vice-President of the Council shall rotate every ten calendar
months among members of the Council. No more than two consecutive Presidents may
come from the same <component state>. The President, and in his absence or temporary
incapacity, the Vice-President, shall represent the Council as Head of State and Head of
Government. The President and Vice-President shall not enjoy a casting vote or otherwise
increased powers within the Council.
e. The [executive heads] of the <component states> shall be invited to participate without a
vote in all meetings of the Council in the first ten years after entry into force of the
Agreement, and thereafter on a periodical basis.
3. The Central Bank of Cyprus, the Office of the Attorney-General and the Office of the
Auditor-General shall be independent.
Article 6 The Supreme Court
1. The Supreme Court shall uphold the Constitution and ensure its full respect.
2. It shall be composed of nine judges, three from each <component state> and three non-
Cypriots.
3. The Supreme Court shall, inter alia, resolve disputes between the <component states> or
between one or both of them and the <common state>, and resolve on an interim basis
deadlocks within the institutions of the <common state> if this is indispensable to the proper
functioning of the <common state>.
Article 7 Transitional <common state> institutions
1. The <common state> institutions shall evolve during transitional periods, after which
these institutions shall operate as described above.
2. Upon entry into force of this Agreement, the leaders of the two sides shall become Co-
Presidents of Cyprus for thirty calendar months. Each Co-President shall be confirmed by
their respective <component state> legislature, which may instead elect another person as
Co-President, and which shall elect a replacement should the office of Co-President fall
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vacant. The Co-Presidents shall exercise the executive power during the first year, assisted
by a Council of Ministers which they shall appoint. For the following two years, the
executive power shall be exercised by a Council of Ministers elected by Parliament, and the
Co-Presidents shall together hold the office of Head of State.
3. <component state> legislatures to be elected within 40 days of entry into force of this
Agreement shall each nominate 24 delegates (reflecting the political composition of their
legislature) to a transitional <common state> Parliament to operate for one year.
4. A transitional Supreme Court shall assume its functions upon entry into force of this
Agreement.
Article 8 Demilitarization
1. Bearing in mind that:
a. The Treaty of Guarantee, in applying mutatis mutandis to the new state of affairs
established in this Agreement and the Constitution of Cyprus, shall cover, in addition to the
independence, territorial integrity, security and constitutional order of Cyprus, the territorial
integrity, security and constitutional order of the <component states>
b. The Treaty of Alliance shall permit Greek and Turkish contingents, each not exceeding
[insert figure between 2,500 and 7,500 prior to the signature of the Comprehensive
settlement] all ranks, to be stationed under the Treaty of Alliance in the Greek Cypriot
<component state> and the Turkish Cypriot <component state> respectively;
c. Greek and Turkish forces and armaments shall be redeployed to agreed locations and
adjusted to agreed levels, and any forces and armaments in excess of agreed levels shall be
withdrawn;
d. There shall be a United Nations peacekeeping operation to monitor the implementation of
this Agreement and use its best efforts to promote compliance with it and contribute to the
maintenance of a secure environment, to remain as long as the government of the <common
state>, with the concurrence of both <component states>, does not decide otherwise;
e. The supply of arms to Cyprus shall be prohibited in a manner that is legally binding on
both importers and exporters; and
f. A Monitoring Committee composed of the guarantor powers, the <common state>, and
the <component states>, and chaired by the United Nations, shall monitor the
implementation of this Agreement,
Cyprus shall be demilitarized, and all Greek Cypriot and Turkish Cypriot forces, including
reserve units, shall be dissolved, and their arms removed from the island, in phases
synchronized with the redeployment and adjustment of Greek and Turkish forces.
2. There shall be no paramilitary or reserve forces or military or paramilitary training of
citizens. All weapons except licensed sporting guns shall be prohibited.
3. Neither <component state> shall tolerate violence or incitement of violence against the
<common state>, the <component states>, or the guarantor powers.
4. Cyprus shall not put its territory at the disposal of international military operations other
than with the consent of Greece and Turkey or the consent of both <component states>.
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5. These provisions do not prejudice the provisions of the Treaty of Establishment, the
Treaty of Guarantee, the Treaty of Alliance, the mandate of the United Nations
peacekeeping operation and the provisions of the Constitution on <common state> and
<component state> police and the Joint Investigation Agency.
Article 9 <component state> boundaries and territorial adjustment
1. The territorial boundaries of the <component states> shall be as depicted in the map
which forms part of this Agreement.
2. Areas subject to territorial adjustment which are legally part of the Greek Cypriot
<component state> upon entry into force of this Agreement, shall be administered during an
interim period no longer than three years by the Turkish Cypriot <component state>.
Administration shall be transferred under the supervision of the United Nations to the Greek
Cypriot <component state> in agreed phases, beginning 90 days after entry into force of this
Agreement with the transfer of administration of largely uninhabited areas contiguous with
the remainder of the Greek Cypriot <component state>.
3. Special arrangements shall safeguard the rights and interests of current inhabitants of
areas subject to territorial adjustment, and provide for orderly relocation to adequate
alternative accommodation in appropriate locations where adequate livelihoods may be
earned.
Article 10 Property
1. Claims by property owners dispossessed by events prior to entry into force of this
Agreement shall be resolved in a comprehensive manner in accordance with international
law, respect for the individual rights of dispossessed owners and current users, and the
principle of bi-zonality.
2. In areas subject to territorial adjustment, properties shall be reinstated to dispossessed
owners.
3. In areas not subject to territorial adjustment, the arrangements for the exercise of property
rights, by way of reinstatement or compensation, shall have the following basic features:
a. Dispossessed owners who opt for compensation or whose properties are not reinstated
under the property arrangements shall receive full and effective compensation on the basis
of value at the time of dispossession adjusted to reflect appreciation of properties in
comparable locations;
b. Current users, being persons who have possession of properties of dispossessed owners as
a result of an administrative decision, may apply for and shall receive title if they agree in
exchange to renounce their title to a property, of similar value and in the other <component
state>, of which they were dispossessed;
c. Persons may also apply for and shall receive title to properties which have been
significantly improved provided they pay for value of the property in original state;
d. There shall be incentives for owners to sell, lease or exchange properties to current users
or other persons from the <component state> in which a property is located;
e. Properties not covered by the above shall be reinstated five years after entry into force of
this Agreement (three years for vacant properties), provided that no more than an agreed
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percentage of the area and residences in either <component state> and an agreed percentage
in any given municipality or village (other than villages specifically designated in this
Agreement) shall be reinstated to owners from the other <component state> and
f. Current users who are Cypriot citizens and are required to vacate property to be reinstated
shall not be required to do so until adequate alternative accommodation has been made
available.
4. Property claims shall be received and administered by an independent, impartial Property
Board, composed of an equal number of members from each <component state>, as well as
non-Cypriot members. No direct dealings between individuals shall be necessary.
Article 11 Reconciliation Commission
1. An independent, impartial Reconciliation Commission shall promote understanding,
tolerance and mutual respect between Greek Cypriots and Turkish Cypriots.
2. The Commission shall be composed of men and women, in equal numbers from each
<component state>, as well as at least one non-Cypriot member, which the Secretary-
General of the United Nations is invited to appoint in consultation with the two sides.
Article 12 Past acts
1. Any act, whether of a legislative, executive or judicial nature, by any authority [...] in
Cyprus whatsoever, prior to entry into force of this Agreement, is recognized as valid and,
provided it is not inconsistent with or repugnant to any other provision of this Agreement or
international law, its effect shall continue following entry into force of this Agreement. No-
one shall be able to contest the validity of such acts by reason of what occurred prior to entry
into force of this Agreement.
2. Any claims for liability or compensation arising from acts prior to this Agreement shall,
insofar as they are not otherwise regulated by the provisions of this Agreement, be dealt with
by the <component state> from which the claimant hails.
Article 13 Entry into force and implementation
1. This Agreement shall enter into force at 00:00 hours on the day following confirmed
approval by each side at separate simultaneous referenda conducted in accordance with the
Agreement.
2. Upon entry into force of this Agreement, there shall be ceremonies throughout the island
at which all flags other than those prescribed in the Constitution are lowered, the flags of
Cyprus and of the <component states> raised in accordance with the Constitution and
relevant legislation, and the anthems of Cyprus and of the <component states> played.
3. Upon entry into force of this Agreement, the Co-Presidents shall inform the United
Nations that henceforth the membership rights and obligations of Cyprus in the United
Nations shall be exercised in accordance with the new state of affairs. The agreed flag of
Cyprus shall be raised at United Nations Headquarters.
4. This Agreement shall be implemented in accordance with the binding timeframes laid
down in the various parts of the Agreement and reflected in the calendar of implementation.
Article 14 Annexes
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The above main articles are reflected in detailed legal language in the Annexes which form
an integral part of this Agreement.
DRAFT ANNEX I: CONSTITUTION OF CYPRUS
Part I: BASIC ARTICLES
Article 1 The State of Cyprus
1. Cyprus is an independent and sovereign state with a single international legal personality
and a <common state> government and consists of a Greek Cypriot <component state> and
a Turkish Cypriot <component state>.
2. The independence, territorial integrity, security, and constitutional order of Cyprus shall
be safeguarded and respected by all.
3. Union of Cyprus in whole or in part with any other country, any form of partition or
secession, and any other unilateral change to the state of affairs established by the
Foundation Agreement and this Constitution is prohibited.
4. Cyprus shall be organised under this Constitution in accordance with the basic principles
of rule of law, democracy, representative republican government, political equality of Greek
Cypriots and Turkish Cypriots, bizonality and the equal status of the <component states>.
Article 2 The <component states>
1. The <component states> are of equal status. Each <component state> exercises its
authority within the limits of this Constitution and its territorial boundaries as set out in the
attachment to this Constitution.
2. The <component states> shall organize themselves freely within the limits of this
Constitution and in conformity with the basic principles of rule of law, democracy, and
representative republican government under their own Constitutions.
3. The identity, territorial integrity, security and constitutional order of the <component
states> shall be safeguarded and respected by all.
Part II: GENERAL PROVISIONS
Article 3 Constitution as supreme law
1. This Constitution, having been democratically adopted by the Greek Cypriots and the
Turkish Cypriots through their separately expressed common will, is the supreme law of the
land and is binding on all authorities of the <common state> and the <component states>.
Any act by the <common state> or either <component state> in contravention of this
Constitution shall be null and void.
2. The <common state> shall fully respect and not infringe upon the powers and functions of
the <component states> under this Constitution. Each <component state> shall fully respect
and not infringe upon the powers and functions of the <common state> or the other
<component state> under this Constitution. There shall be no hierarchy between the laws of
the <common state> and those of the <component states>.
3. The Supreme Court shall uphold this Constitution and ensure its full respect by the organs
of the <common state> and the <component states>.
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Article 4 Rule of law
1. The law is the basis of and limitation for all acts of government at all levels.
2. All acts of government at all levels shall conform with the principles of public interest,
proportionality and good faith.
3. The <common state> as well as the <component states> shall respect international law,
including all treaties binding upon Cyprus, which shall be considered an integral part of this
Constitution.
Article 5 Secular nature of Cyprus and its <component states>
1. The State of Cyprus and its <component states> are secular.
2. Religious functionaries shall not hold elected or appointed political or public office.
Article 6 Demilitarisation of <common state> and <component states>
1. The <common state> and the <component states> shall be demilitarized. There shall be
no paramilitary or reserve forces or military or paramilitary training of citizens.
2. Cyprus shall not put its territory at the disposal of international military operations other
than with the consent of Greece and Turkey or the consent of the governments of both
<component states>.
3. All weapons, except licensed sporting guns, shall be prohibited.
4. Neither <component state> shall tolerate violence or the incitement of violence against
the <common state>, the <component states>, or the guarantor powers by persons, groups or
organisations operating within its boundaries.
5. The provisions of this Article are without prejudice to the provisions of the Treaty of
Establishment, the Treaty of Guarantee, the Treaty of Alliance, the mandate of a UN
peacekeeping operation in Cyprus and the provisions of this Constitution on <common
state> and <component state> police and the Joint Investigation Agency.
Article 7 Flags and anthems
1. The flag of Cyprus shall be [insert description of agreed flag], as attached to this
Constitution. The flag of Cyprus shall be flown alone or together with the flag of the
European Union on <common state> government buildings
2. The anthem of Cyprus shall be [insert name of agreed anthem], as attached to this
Constitution.
3. The <component states> shall have their own anthems and flags. The <component state>
flag shall be flown on <component state> government buildings, along with and in the same
manner as the flag of Cyprus and, if <component state> lw so provides, that of the European
Union. No other flag shall be flown on <component state> government buildings or public
property.
Article 8 The official languages and promulgation of official acts
1. The official languages of the <common state> are Greek and Turkish. The use of English
for official purposes shall be regulated by law.
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2. Legislative, executive, administrative and judicial acts and documents of the <common
state> shall be drawn up in all official languages and shall, unless otherwise provided, be
promulgated by publication in the official Gazette of Cyprus in all official languages.
3. All persons shall have the right to address the authorities of the <common state> in any of
the official languages and to be addressed in that same language.
4. The official languages of the <common state> shall be taught mandatorily to all secondary
school students.
Article 8 Official Holidays of the <common state>
1. The National Holiday of Cyprus shall be the day of the referenda on the Foundation
Agreement.
2. In addition to Sundays, the following official holidays shall be observed throughout
Cyprus:
a. 1 January (New Year's Day);
b. 1 May (Labour Day);
c. 25 December (Christmas);
d. Good Friday;
e. Easter Monday;
f. The first day of Ramadan/Sheker Bayram;
g. The first day of Kurban Bayram; and
h. The birthday of the Prophet Mohammed.
3. Each <component state> shall determine and observe its own holidays in addition to those
of the <common state>.
4. Public servants of the <common state> shall be entitled to observe, in addition to the
above, the official holidays of either one <component state> or the other.
Part III: FUNDAMENTAL RIGHTS AND LIBERTIES
Article 10 Fundamental Rights
1. In accordance with Article 4(3) of this Constitution, the European Convention for the
Protection of Human Rights and Fundamental Freedoms and its Additional Protocols which
are in force for Cyprus and the United Nations Covenant on Civil and Political Rights shall
be an integral part of this Constitution.
2. There shall be no discrimination against any person on the basis of his or her gender,
ethnic or religious identity, or internal <component state> citizenship status.
3. There shall be freedom of movement and freedom of residence throughout Cyprus, except
as otherwise expressly provided in this Constitution or any other parts of the Foundation
Agreement or a Constitutional Law.
4. The rights of religious and other minorities, including the Maronite, the Latin and the
Armenian, shall be safeguarded. The <common state> and the <component states> shall,
144
within their respective spheres of competence, afford minorities the status and rights
foreseen in the European Framework Convention for the Protection of National Minorities,
in particular the right to administer their own cultural and educational affairs and to be
represented in the legislature.
5. Greek Cypriots residing in the Karpas villages of Rizokarpaso/Dipkarpaz, Agialousa/Yeni
Erenköy, Agia Trias/Sipahi, Melanarga/Adacay, and Maronites residing in the villages of
Agia Marina/Gurpinar, Asomatos/Özhan, Karpasha/Karpasa and Kormakiti/Koruçam, and
Turkish Cypriots residing in the Tillyria villages of Amadhies/Gunebakan,
Limnitis/Yesilyirmak, Selemani/Suleymaniye, Xerovounos/Kurutepe and Agios
Georgios/Madenliköy, as well as the Mesaoria villages of Pyla and [insert other villages
with more than 20% Turkish Cypriots in 1960 should they fall within the area of territorial
adjustment] shall, within the <component states> in which these villages are situated, enjoy
the right to administer their own cultural and educational affairs and to be represented in the
<component state> legislature..
Article 11 Citizenship
1. There is a single Cypriot citizenship.
2. All persons holding Cypriot citizenship shall also enjoy internal <component state>
citizenship status as provided for by Constitutional Law. Such status, like the European
Union citizenship status, is complementary to and does not replace Cypriot citizenship.
3. Where any provision of this Constitution or of the Foundation Agreement refers to the
<component state> origins of a person (or where a person hails from), the criterion shall be
the holding of internal <component state> citizenship status. No one may hold the internal
<component state> citizenship status of both <component states>.
Article 12 Exercise of political rights
Cypriot citizens who are at least 18 years old shall enjoy political rights at the <common
state> level and exercise them based on their internal <component state> citizenship status.
Part IV: THE <COMMON STATE> AND THE <COMPONENT STATES>
Article 13 Competences and functions of the <common state>
1. The <common state> shall, in accordance with this Constitution, sovereignly exercise
legislative and executive competences in the following matters:
a. External relations, including conclusion of international treaties and defence policy;
b. Relations with the European Union;
c. Central Bank functions, including issuance of currency, monetary policy and banking
regulations;
d. common state> finances, including budget and all indirect taxation (including customs
and excise), and <common state> economic and trade policy;
e. Natural resource, including water resources;
f. Meteorology, aviation, international navigation and the continental shelf and territorial
waters of Cyprus;
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g. Communications (including postal, electronic and telecommunications);
h. Cypriot citizenship (including issuance of passports) and immigration (including asylum,
deportation and extradition of aliens);
i. Combating terrorism, drug trafficking, money laundering and organised crime;
j. Pardons and amnesties;
k. Intellectual property and weights and measures; and
l. Antiquities
2. Incidental to the above competences and to other provisions of this Constitution, the
<common state> shall exercise legislative and executive competences over <common state>
administration (including public service, <common state> police, as well as its independent
institutions and officers); <common state> elections and referenda; offences against
<common state> laws; administration of justice by the Supreme Court; <common state>
property, including public works for <common state> facilities and expropriation; and like
matters which are clearly incidental to the specified powers of the <common state>.
3. The <common state> shall, as appropriate, entrust the implementation of its laws
including the collection of certain forms of taxes, to <component state> authorities.
4. Obligations of the <common state> under international treaties shall be implemented by
the <common state> or <component state> authority which enjoys legislative competence in
the subjec matter to which the treaty pertains.
5. The <common state> shall confer upon the <component states> a portion of its revenue
from indirect taxation as provided for by special majority law.
Article 14 Competences and functions of the <component states>
1. The <component states> shall, within the limits of this Constitution, sovereignly exercise
within their territorial boundaries all competences and functions not vested by this
Constitution in the <common state>.
2. The <component states> shall have primary criminal jurisdiction over offences against
<common state> laws, unless such jurisdiction is reserved for the Supreme Court of Cyprus
by <common state> legislation.
3. The police of a <component state> shall be stationed and operate exclusively within that
<component state> and shall be responsible for the protection and enforcement of law and
order and public safety within that <component state>, including offences against <common
state> laws, without prejudice to the functions of the <common state> police and the Joint
Investigation Agency. A Constitutional Law shall regulate the strength and equipment of
<component state> police and a Cooperation Agreement between the <common state> and
the <component states> shall provide for cooperation on police matters.
Article 15 Cooperation and coordination
1. Where expressly provided for in this Constitution, legislative matters may be regulated in
a manner binding upon the <common state> and the <component states>, through
Constitutional Laws. Such laws shall be approved by the legislatures of the <common state>
146
and the <component states> in accordance with procedures set down in a Constitutional Law
and shall have precedence over any other <common
state> of <component state> laws.
2. The <component states> may conclude agreements with each other or with the <common
state>. Such agreements may create common organizations and institutions on matters
within the competence of the parties.
3. The <component states> shall strive to coordinate or harmonize their policy and
legislation, including through agreements, common standards and consultations wherever
appropriate, in particular on the following matters:
a. Tourism;
b. Protection of the environment and use and conservation of energy and natural resources,
including water;
c. Fisheries and agriculture;
d. Industry and commerce, including insurance, consumer protection, professions and
professional associations;
e. Zoning and planning, including for overland transport;
f. Sports and education;
g. Health, including regulation of tobacco, alcohol and drugs, and veterinary matters;
h. Social security and labour;
i. Family, company and criminal law; and
j. Acceptance of validity of documents.
4. Either <component state> or any branch of the <common state> government may initiate
the coordination or harmonization process.
5. Agreements on such coordination or harmonization shall be approved by the competent
branch of the <component state> governments and, if <common state> participation is
required, by the competent branch of the <common state>.
6. The <common state> shall support, both financially and logistically, cooperative
endeavours between the <component states> or between municipalities and villages located
in different <component states>.
7. The <common states> and the <component states> shall accept valid documents issued by
government authorities and educational, medical and other public service institutions.
Article 16 Joint Investigation Agency
There shall be a Joint Investigation Agency, comprising <common state> and <component
state> police personnel and reporting to the Attorney-General. Its composition and
functions, as well as the strength and equipment of the <common state> and <component
state> police, shall be regulated by Constitutional Law.
Article 17 External relations
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1. Cyprus shall maintain special ties of friendship with Greece and Turkey, respecting the
balance established by the Treaty of Guarantee and the Treaty of Alliance and the
Foundation Agreement.
2. The <component states> shall be consulted on <common state> decisions on external
relations that affect their competences.
3. The <component states> may appoint representatives on commercial and cultural matters,
who shall be accredited as part of diplomatic missions of Cyprus.
4. The <component states> may also conclude agreements on commercial and cultural
matters with authorities of States that have relations with Cyprus, provided that such
agreements do not cause prejudice to Cyprus, the authority of the <common state>
government, or the other <component state>, and are compatible with the European Union
membership of Cyprus.
5. In the exercise of the powers conferred by paragraphs 3 and 4 of this Article, the
following procedures shall be observed:
a. The <component states> shall use the channel of the <common state> ministry of foreign
affairs for contacts at a political level with foreign governments; and
b. The <component states> may have direct contacts with sub-entities or subordinate
authorities of other states. In this case they shall inform the <common state> ministry of
foreign affairs upon starting negotiations on any agreement with such authorities and
continue to advise on the progress and outcome of such negotiations.
6. A Cooperation Agreement between the <common state> and the <component states> on
external relations shall regulate the implementation of this Article.
Article 18 Cyprus as a member of the European Union
1. Cyprus shall be a member of the European Union.
2. The governments of the <component states> shall participate in the formulation of the
policy of Cyprus in the European Union.
3. Cyprus shall be represented in the European Union by the <common state> government in
its areas of competence or where a matter predominantly concerns an area of its competence.
Where a matter falls predominantly or exclusively into an area of competence of the
<component states>, Cyprus may be represented either by a <common state> or a
<component state> representative, provided the latter is able to commit Cyprus.
4. Obligations of Cyprus arising out of European Union membership shall be implemented
by the <common state> or <component state> authority which enjoys legislative
competence for the subject matter to which an obligation pertains. Where the acquis
communautaire prescribes the creation of single national administrative structures, such
structures and the necessary regulations will be established at <common state> level. The
establishment of other administrative structures necessary for the implementation of the
acquis communautaire will be decided on the basis of efficiency requirements.
5. If a <component state> fails to fulfil obligations of Cyprus vis-à-vis the European Union
within its area of competence and Cyprus may be held responsible by the Union, the
<common state> shall, after notification of no less than 90 days (or a shorter period of
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indispensable according to the European Union requirements), take necessary measures in
lieu of the defaulting <component state>, to be in force until such time as that <component
state> discharges its responsibilities.
6. Paragraphs 2-5 of this Article shall be the subject of a Cooperation Agreement between
the <common state> and the <component states>.
7. Amendments to the treaties on which the European Union is founded or acts of accession
of any applicant states to the European Union which require ratification by all member states
of the European Union, shall be ratified by Cyprus unless this is opposed by each of the
legislatures of the <common state> and the <component states>. The President or the Vice-
President of the Presidential Council shall be entitled to sign the respective instrument of
ratification and thereby bind Cyprus.
8. No provision of this Constitution shall invalidate laws, acts or measures by the <common
state> or the <component states> required by the obligations of European Union
membership, or prevent laws, acts or measures by the European Union, or institutions
thereof, from having the force of law throughout Cyprus.
Part V: <COMMON STATE> INSTITUTIONS
Article 19 Eligibility and incompatibility and discharge of duties
1. Unless otherwise provided by this Constitution or law, a person shall be qualified to be
elected or appointed to serve in the <common state> institutions if he or she is a citizen of
Cyprus and has reached the age of 18.
2. Unless otherwise provided by this Constitution or law, no person may be a member of
more than one branch of the <common state> government or the <common state>
government and a <component state> government.
3. Persons elected to or appointed to serve in the <common state> institutions shall act in the
best interests of the <common state>.
Article 20 <common state> immunities and exemptions
1. Members of Parliament, the Presidential Council, the Supreme Court and the Board of the
Central Bank of Cyprus, as well as the Independent Officers, shall enjoy immunity from
arrest or judicial prosecution unless <common state> law provides otherwise.
2. <common state> property used for official purposes shall be exempt from the application
of <component state> legislation, including taxation. Such property shall be under the direct
and sole authority of the <common state>. The <component states> shall assist the
<common state> police in assuring the safety of <common state> property located within
their territorial boundaries.
Section A: The Legislature
Article 21 Composition and election of Parliament
1. The <common state> Parliament shall be composed of two Chambers: the Senate and the
Chamber of Deputies.
2. Each Chamber shall have 48 members, elected for five years on the basis of proportional
representation. The <component states> shall serve as electoral precincts unless special
149
majority law provides otherwise, in which case each precinct may have no less than ten
seats.
3. The Senate shall be composed of an equal number of senators from each <component
state>. The people of each <component state> shall elect, on a proportional basis, 24
members of the Senate.
4. The Chamber of Deputies shall be composed of deputies from both <component states>,
with seats attributed on the basis of the number of persons holding internal <component
state> citizenship status of each <component state> provided that each <component state>
shall be attributed a minimum of one quarter of the seats.
5. The Maronite, Latin and Armenian minorities shall each be represented by no less than
one deputy. Members of such minorities shall be entitled to vote for the election of such
deputies irrespective of their place of residency in Cyprus. Such deputies shall be counted
against the quota of the <component state> where the majority of the members of the
respective minority reside.
Article 22 Organisation
1. The law shall regulate the time and duration of the ordinary sessions of the <common
state> Parliament. At any time, the Presidential Council or one quarter of sitting members of
either Chamber may convene Parliament for an extraordinary session.
2. Each Chamber shall elect a President and two Vice-Presidents, one from each
<component state>, for a period of one year. The Presidents of the two Chambers shall not
come from the same <component state>. The Vice President who does not come from the
same <component state> as the President of the relevant Chamber shall be the First Vice-
President of that Chamber.
3. Each Chamber shall organise its own committees in accordance with the law.
4. Each Chamber shall require the presence of a majority of sitting members in order to take
decisions.
5. The law shall regulate the obligation of members of Parliament to attend meetings and the
consequences of failure to do so without authorization.
Article 23 Powers
1. Parliament shall legislate and take decisions.
2. Parliament shall approve international treaties for
ratification, except where it has delegated that power to the Presidential Council.
3. Parliament shall elect and oversee the functioning of the Presidential Council.
4. Parliament may by special majority refer to the Supreme Court allegations of
impeachment regarding members of the Presidential Council and of organs of the
independent institutions, and independent officers, for grave violations of their duties or
serious crimes.
5. Parliament shall adopt the <common state> budget.
Article 24 Procedure
150
1. Unless otherwise specified, decisions of Parliament need the approval of both Chambers
with simple majority of members present and voting, including one quarter of senators
present and voting from each <component state>.
2. A special majority comprising at least two fifths of sitting senators from each <component
state>, in addition to a simple majority of deputies present and voting, shall be required for:
a. Ratification of international agreements on matters which fall within the legislative
competence of the <component states>
b. Ratification of treaties and adoption of laws and regulations concerning the airspace,
continental shelf and territorial waters of Cyprus;
c. Adoption of laws and regulations concerning citizenship, immigration, water resources
and taxation;
d. Approval of the <common state> budget;
e. Election of the Presidential Council; and
f. Other matters which specifically require special majority approval pursuant to other
provisions of this Constitution.
3. The law shall provide for a conciliation mechanism between the Chambers of Parliament.
Section B: The Executive
Article 25 The Presidential Council
1. The Office of Head of State is vested in a six-member Presidential Council, which shall
exercise the executive power.
2. The members of the Presidential Council shall be elected by Parliament for a fixed five-
year term on a single list by special majority.
3. Members of the Presidential Council shall not hold any other public office or private
position.
4. The members of the Presidential Council shall continue to exercise their functions after
expiry of their term in office until a new Council has been elected.
5. In the event of a vacancy in the Council, a replacement shall be elected by Parliament by
special majority for the remainder of the term of office.
6. The composition of the Presidential Council shall be proportional to the number of
persons holding the internal <component state> citizenship status of each <component
state>, though at least two members must hail from each <component state>.
7. The Presidential Council shall strive to reach all decisions by consensus. Where it fails to
reach consensus, it shall make decisions by simple majority of members voting unless
otherwise stated in this Constitution. Such majority must in all cases comprise at least one
member from each <component state>.
8. The members of the Presidential Council shall be equal. Any member of the Council shall
be able to place an item on the agenda of the Council.
151
9. The Presidential Council may, where appropriate, invite the [executive heads] of the
<component states> to participate without a vote in its meetings.
10. The Presidential Council shall suggest candidates or appoint members for European
Union and international bodies, including the European Commission, the European Human
Rights Court in Strasbourg, the European Court of the Communities in Luxembourg and the
European Court of First Instance.
Article 26 The President and the Vice-President of the Council
1. The President and Vice-President of the Council shall not hail from the same <component
state>.
2. The offices of the President and Vice-President of the Council shall rotate every ten
calendar months among members of the Council on the basis of time spent on the Council
since last serving in either office and with no more than two consecutive Presidents to come
from the same <component state>. Among members of the Council who have spent equal
time on the Council without having served as President or Vice-President, a lot shall be
drawn, unless the members concerned agree to an order of precedence.
3. The Vice-President of the Council shall assume the duties of the President in the absence
or temporary incapacity of the President.
4. The President of the Council shall convene and chair the meetings of the Presidential
Council.
5. Neither the President nor the Vice President of the Council shall have a casting vote.
Article 27 The Departments
1. Each member of the Presidential Council shall head a department.
2. Departments shall be attributed by decision of the Council. Where the Council is unable
to reach a decision, departments shall be attributed on the basis of time spent on the Council;
among members who have spent equal time, a lot shall be drawn.
3. The heads of the Departments of Foreign Affairs and European Union Affairs shall not
hail from the same <component state>.
4. The heads of department shall prepare and execute decisions of the Presidential Council.
Article 28 Representation of the Presidential Council
1. The President of the Council shall represent the Presidential Council as Head of State.
2. In representing the Presidential Council as Head of State, the President shall attend
official functions, sign and receive credentials of diplomatic envoys, and confer the honours
of Cyprus.
3. The President of the Council shall represent Cyprus at meetings of heads of government,
unless the Presidential Council, deciding with separate majorities of members from each
<component state>, designates another member.
4. The heads of the relevant Departments/Secretariats/Ministries shall represent Cyprus at
meetings of government ministers unless otherwise provided for by law or by agreement
between the <common state> and the <component states>.
152
5. Where an international meeting is likely to address vital interests of a <component state>,
and the Council representative to that meeting hails from the other <component state>, the
Council shall, upon special request of a majority of Council members from the interested
<component state>, appoint a member from that <component state> to accompany the
Council representative, provided delegations to such meetings may comprise more than one
person.
6. Any representative of Cyprus at international meetings shall be bound by decisions of the
Presidential Council. Where the Council has appointed one of its members to accompany its
representative in accordance with paragraph 5 of this Article, the representative of Cyprus
shall exercise any discretion in concord with such member.
Article 29 The administration of the <common state>
1. A Public Service Commission composed of men and women hailing in equal numbers
from each <component state> shall have authority to appoint and promote <common state>
public servants. It shall take its decisions in accordance with the law.
2. The composition of the public service shall, where not otherwise specified in this
Constitution or special majority law, be proportional to the populationof the <component
states>, though at least one-third of the public servants at every level of the administration
must hail from each <component state>.
3. A public servant of the <common state> may not simultaneously serve as a public servant
of a <component state>.
Article 30 The <common state> police
The <common state> shall have a police composed of an equal number of personnel hailing
from each <component state>. The <common state> police shall control Cyprus’ border and
protect <common state> officials, buildings and property, as well as foreign dignitaries and
diplomatic missions.
Section C: Independent Officers and Institutions
Article 31 Central Bank of Cyprus
1. The Central Bank of Cyprus shall be independent and operate in accordance with
European Union requirements.
2. It shall issue currency, determine monetary policy and the prime lending rate, and regulate
and supervise the banking sector.
3. The Central Bank shall be governed by a Board of three members, one of whom shall be
the Governor. At least one member shall hail from each <component state> the third
member may be a non-Cypriot.
4. The Governor and the other two members of Board shall be appointed by the Presidential
Council for a term of seven years.
5. The law may provide for the establishment of branches of the Central Bank in each
<component state>, and for inclusion of branch directors in the Board of the Central Bank.
6. All decisions of the Board of the Central Bank shall be taken by simple majority.
Article 32 Other independent officers
153
1. The Attorney-General and the Deputy Attorney-General and the Auditor-General and the
Deputy Auditor-General shall be appointed by the Presidential Council for a non renewable
term of office of nine years but no longer than until their 75th birthday.
2. The Attorney-General and the Auditor-General shall not hail from the same <component
state> nor shall the Attorney-General and the Deputy Attorney-General or the Auditor
General and the Deputy-Auditor General.
Article 33 The office of the Attorney-General and the Deputy
Attorney-General
[insert article]
Article 34 The office of the Auditor-General and the Deputy Auditor-General
[insert article]
Section D: The Judiciary
Article 35 The Supreme Court of Cyprus
1. The Supreme Court of Cyprus shall count an equal number of judges from each
<component state> among its members. The Presidential Council shall appoint the judges,
for a renewable term of office of seven years, in accordance with criteria and procedures
stipulated in a special majority law which shall also fix the number of judges.
2. The Supreme Court shall have exclusive jurisdiction over disputes between the
<component states> and between one or both <component states> and the <common state>
and between organs of the <common state>.
3. The Supreme Court shall have exclusive jurisdiction to determine the validity of any
<common state> or <component state> law under this Constitution or any question that may
arise from the precedence of Constitutional laws. Upon request of <component state> courts
or other <common state> or <component state> authorities it may do so in the form of a
binding opinion.
4. The Supreme Court shall be the appeals court in all other disputes on matters which
involve the interpretation of the Foundation Agreement, this Constitution, <common state>
laws (including administrative decisions of the <common state>), or treaties binding upon
Cyprus.
5. The Supreme Court shall have primary jurisdiction over violations of <common state>
law where provided by <common state> legislation.
6. If a deadlock arises in one of the institutions of the <common state> preventing the taking
of a decision without which the <common state> or its institutions could not properly
function, or the absence of which would result in a substantial default on the obligations of
Cyprus as a member of the European Union, the Supreme Court may, upon application of a
member of the Presidential Council, the President or Vice-President of either Chamber of
Parliament, or the Attorney-General or the Deputy Attorney-General, take an ad interim
decision on the matter, to remain in force until such time as a decision on the matter is taken
by the institution in question. In so acting, the Supreme Court shall exercise appropriate
restraint.
154
7. The Supreme Court shall decide on the organization of its work. If it chooses to divide
itself into Chambers for the treatment of certain cases, such Chambers shall always include
an equal number of judges from each <component state>.
8. The Supreme Court shall strive to reach its decisions by consensus and issue joint
judgments of the Court. However, all decisions of the Supreme Court may be taken by
simple majority.
Part VI: AMENDMENTS OF THIS CONSTITUTION
Article 36 Amendments of this Constitution
1. Amendments of this Constitution, including the attachments which are an integral part of
it, shall be considered and adopted by the <common state> legislature after consultation with
the governments of the <component states> and interested sectors of society.
2. The Basic Articles of this Constitution cannot be amended.
3. After adoption by both Chambers of Parliament, proposed amendments shall be submitted
to referendum for approval by separate majority of the people in each <component state>.
4. Amendments shall enter into force 90 days after their approval, unless the amendment
otherwise provides.
Part VII: TRANSITIONAL PROVISIONS
Article 37 <component state> institutions
1. No later than 40 days after entry into force of the Foundation Agreement, the <component
states> shall elect the members of their legislatures and other popularly elected officials in
accordance with the <component state> Constitution and legislation approved in referenda.
2. The newly elected members of the <component state> institutions shall assume office
within ten days of their election.
Article 38 Transitional <common state> Parliament
1. Each newly elected <component states> legislature shall, without delay designate from
among its membership 24 delegates to the <common state> Parliament. To this effect, each
group in a <component state> legislature shall designate as many delegates as corresponds
to its proportional strength in the legislature.
2. The transitional parliament shall exercise the constitutional functions and prerogatives of
the <common state> Parliament during the first year after entry into force of the Foundation
Agreement in accordance with the procedural provisions in this Constitution regarding the
Senate.
3. No later than ten calendar months after entry into force of the Foundation Agreement, the
senators and deputies shall be elected in accordance with this Constitution. The newly
elected Parliament shall assume its functions one year after entry into force of the
Foundation Agreement.
Article 39 Transitional <common state> Head of State
1. For a transitional period of thirty calender months, the office of the Head of State shall be
vested in the Co-Presidency.
155
2. Upon entry into force of the Foundation Agreement, the leaders who have signed the
Comprehensive Settlement on behalf of the Greek Cypriots and the Turkish Cypriots shall
become Co-Presidents of Cyprus. Each <component state> legislature, as soon as it is
constituted, shall confirm the Co-President from its <component state> or elect another
person to the office.
3. In case of resignation or permanent incapacity of either leader, the legislature of the
relevant <component state> shall elect a replacement. If such resignation or incapacity
occurs before the legislature of the relevant <component state> has been elected, the most
senior judge from that <component state> selected for or appointed to the Supreme Court
shall assume the role of Co-President.
4. The Co-Presidents shall alternate every calendar month in representing the Co-Presidency
as Head of State.
Article 40 Transitional <common state> government
1. The Co-Presidents shall exercise the executive power during the first year of the
transitional period in accordance with the relevant provisions for the Presidential Council.
They shall act and decide by consensus.
2. The Co-Presidents shall name six Cypriot citizens to head the departments of the
<common state> government during the first year of the transitional period. The heads of
departments shall be confirmed by Parliament through simple majority. They shall exercise
the functions of the executive, which the Co-Presidents shall delegate to them, in accordance
with the procedures provided for in this Constitution for the Presidential Council.
3. One year after entry into force of the Foundation Agreement, the newly elected
Parliament shall elect a Council of Ministers composed of six members. The provisions of
this Constitution for the Presidential Council shall apply mutatis mutandis to the election,
functioning and powers (other than those vested in the Head of State) of the Council of
Ministers.
4. During a second phase of the transitional period, the Council of Ministers shall act as the
Government of the <common state> of Cyprus while the functions of Head of State shall
continue to be vested in the Co-Presidency.
5. Thirty calendar months after entry into force of the Foundation Agreement, the Council of
Ministers shall become the Presidential Council in accordance with the provisions of this
Constitution, assuming also the function of Head of State, for a remaining three and a half
years, during which time the rotation period for the offices of President and Vice-President
shall be seven months.
Article 41 Participation of [executive heads] of <component states> in meetings of
Presidential Council
During the first ten years after entry into force of the Foundation Agreement, the [executive
heads] of the <component states> shall be invited to participate without a vote in meetings
of the Council of Ministers and, later, the Presidential Council.
Article 42 Entry into force of accession treaty to the European Union
156
The referenda approving, together with the Foundation Agreement, the conditions of
accession of Cyprus to the European Union, shall authorise and oblige the Co-Presidents to
sign and ratify the Treaty providing for the accession of Cyprus to the European Union.
Article 43 Transitional Board of the Central Bank
The members of the transitional Board of the Central Bank selected in accordance with
Appendix B of the Comprehensive Settlement shall assume their functions immediately
upon entry into force of the Foundation Agreement and shall remain in office for 15
calender months, when they shall be replaced by the Board appointed in accordance with the
provisions of this Constitution by the Council of Ministers elected by the two chambers of
the Parliament. The transitional Board shall exercise the powers provided for the Board in
the Constitution until the regularly appointed Board takes office.
Article 44 Judges of the transitional Supreme Court
The judges of the transitional Supreme Court selected in accordance with Appendix B of the
Comprehensive Settlement shall assume their functions immediately upon entry into force of
the Foundation Agreement and shall remain in office for 15 calendar months, when they
shall be replaced by the judges appointed in accordance with the provisions of this
Constitution by the Council of Ministers elected by the two chambers of Parliament. The
transitional Court shall exercise the powers provided for the Supreme Court in the
Constitution until the regularly appointed Supreme Court takes office one year after entry
into force of the Foundation Agreement.
Article 45 Public Service
The Law shall specify implementation procedures and timeframes, not exceeding [insert
figure] years from the entry into force of the Foundation Agreement, for the full
implementation of the provisions of this Constitution relating to the composition of the
public service for the different branches of that service.
Article 46 Responsibility for debts incurred prior to the entry into force of the
Foundation Agreement
The <common state> shall assume responsibility for debts incurred prior to the entry into
force of the Foundation Agreement other than debts to Greece or Turkey or debts from
purchase of armaments, which shall be assumed by the relevant <component state>. Special
majority law may provide for reimbursement of the <common state> by the <component
states>.
Article 47 Teaching of official languages
The mandatory teaching of the official languages of the <common state> to all secondary
school students prescribed in Article 7(4) shall commence no later than three years after
entry into force of the Foundation Agreement.
Article 48 State-owned property
Public property of the <common state> is listed in an attachment to this Constitution. Other
public property is the property of the <component state> in which it is located.
Part VIII: ADDITIONAL PROVISIONS
[insert further articles]
157
ATTACHMENT 1: MAP OF CYPRUS AND ITS <COMPONENT STATES>
[insert topographic map, indicating agreed <component state> boundary]
ATTACHMENT 2: FLAG OF CYPRUS
[insert image of agreed flag]
ATTACHMENT 3: ANTHEM OF CYPRUS
[insert agreed anthem]
ATTACHMENT 4: PROPERTY OF THE <COMMON STATE>
[insert agreed list/description of property of <common state>]
DRAFT ANNEX II: CONSTITUTIONAL LAWS
The attachments of this Annex shall be Constitutional Laws upon entry into force of the
Foundation Agreement, able to be amended in accordance with the Constitution.
ATTACHMENT 1: CONSTITUTIONAL LAW ON THE ELABORATION AND
ADOPTION OF CONSTITUTIONAL LAWS
[insert text]
ATTACHMENT 2: CONSTITUTIONAL LAW ON POLICE MATTERS AND THE
JOINT INVESTIGATION AGENCY
Article 1 <component state> police
Each <component state> police may not number more than 700 police personnel plus six
police personnel per thousand <component state> inhabitants. The <component state> police
may only carry weapons appropriate for normal police civilian duties.
Article 2 Joint Investigation Agency
There shall be a Joint Investigation Agency comprising <common state> and <component
state> police personnel, hailing in equal numbers from each <component state>, and
reporting to the Attorney-General of the <common state>. It shall combat terrorism, drug
trafficking, money laundering and organised crime. It shall also investigate alleged
violations of police duties by <common state> or <component state> police, or of Article
6(3) and (4) of the Constitution, upon request of any <common state> or <component state>
authority.
Article 3 Cooperation
The Joint Investigation Agency and the <common state> police shall cooperate with each
other and with the police of the <component states> pursuant to the Cooperation Agreement
on police matters between the <common state> and the <component states>.
[insert further articles]
ATTACHMENT 3: CONSTITUTIONAL LAW ON INTERNAL <COMPONENT
STATE> CITIZENSHIP STATUS AND <COMPONENT STATE> RESIDENCY
RIGHTS.
158
Article 1 Internal <component state> citizenship status upon entry into force of the
Foundation Agreement
1. Upon entry into force of the Foundation Agreement, Cypriot citizens shall automatically
be afforded the internal <component state> citizenship status of the <component state>
which at that time administers the territory where they reside.
2. Persons residing, at the time of entry into force of the Foundation Agreement, in the
Maronite villages of Agia Marina/Gurpinar, Asomatos/Ozhan, Karpasha/Karpasa, and
Koramakiti/Korucam, the Mesaoria village of Pyla and the Karpas Villages of
Rizokarpaso/Dipkarpaz, Agialousa/Yeni Erenkoy, Agia Trias/Sipahi, Melanarga/Adacay
may, within one year of that date, elect to have the internal <component state> citizenship
status of the other <component state>.
3. Cypriot citizens residing abroad shall be afforded the internal <component state>
citizenship status of the Greek Cypriot <component state> if they or their forebears belonged
to the Greek Cypriot community before 1974, or the internal <component state> citizenship
status of the Turkish Cypriot <component state> if they or their forebears belonged to the
Turkish Cypriot community before 1974.
Article 2 Acquisition of internal <component state> citizenship status
1. Persons acquiring Cypriot citizenship shall also acquire the internal <component state>
citizenship status of the <component state> in which they reside, provided they have resided
there for seven years preceding their naturalisation. If this requirement is not fulfilled, they
shall acquire the internal <component state> citizenship status of the <component state> in
which they have resided longer.
2. Any Cypriot citizen who has been resident in a <component state> for any seven
consecutive years shall be entitled to apply to change his/her internal <component state>
citizenship status to that of the <component state> where s/he resides.
Article 3 Exercise of political rights at the <component state> level
A <component state> may restrict, within the limits of European Union law and this
Constitution, the exercise of political rights at its level to persons holding its internal
<component state> citizenship status.
Article 4 Supreme Court injunctions on entry or residence
A <component state> may apply to the Supreme Court of Cyprus for an injunction barring a
person who does not hold its internal <component state> citizenship status from entering or
residing in that <component state>. The Supreme Court shall grant the injunction if the
relevant person has been, or is actively engaged, in acts of violence or incitement to violence
and his/her presence in that <component state> would be a danger to public safety or public
order.
Article 5 Permissible limitation on residency of non-Cypriots
The <component states> may, within the limits of international law, European Union law
and this Constitution, establish rules and regulations on establishment of residence by non-
Cypriots more restrictive than those of the <common state>.
Article 6 Permissible limitation on residency of Cypriots
159
1. A <component state> may restrict the right to reside of Cypriot citizens who do not hold
its internal <component state> citizenship status, if the number of such residents has reached
28% of its population
2. No later than 25 years after the entry into force of this Agreement, the <common state>
and the<component states> shall review the relevant Constitutional Law in light of
experience.
3. Any restrictions on residency shall not prevent the freedom of movement throughout
Cyprus, including the right of any Cypriot citizen to temporarily (i.e. no more than an
average of three nights a week) stay or holiday in their own properties or any other
accommodation anywhere in Cyprus.
Article 7 Permissible transitional limitations on residency
1. Without prejudice to the provisions of the above Article, <component states> may, during
a transitional period of 15 years after entry into force of the Foundation Agreement, further
restrict the establishment of residence, on a non-discriminatory basis, of Cypriot citizens
who do not hold the relevant internal <component state> citizenship status.
2. Permissable restrictions include a moratorium on such residence during the first four years
after entry intro force of the Foundation Agreement. Thereafter, there may be restrictions if
the number of such residents has reached 8% of the population of a village or municipality
between the 5th
and 9th
years and 18% between the 10th
and 15th
years.
3. Within the permissible limit, priority shall be given first to persons to whom properties
have been reinstated by order of the Property Board, and their families; second to other
persons who were inhabitants of the relevant municipality or village before 1963 or 1974
respectively, and their families; and third to the heirs of either category of persons.
4. There shall be no limitations for establishment of residence by former inhabitants and
their descendants in the Tillyria villages of Amadhies/Gunebakan, Limnitis/Yesilyirmak,
Selemani/Suleymaniye, Xerovounos/Kurutepe and Agios Georgios/Madenlikoy, the
Maronite villages of Agia Marina/Gurpinar, Asomatos/Ozhan, Karpasha/Karpasa and
Kormakiti/Korucam, the Mesaoria villages of Pyla and [insert other villages with more than
20% Turkish Cypriots in 1960 should they fall within the area of territorial adjustment] and
the Karpas villages of Rizokarpaso/Dipkarpaz, Agialousa/Yeni Erenkoy, Agia Trias/Sipahi,
Melanarga/Adacay.
[insert further articles]
DRAFT ANNEX III: <COMMON STATE> LEGISLATION UPON ENTRY INTO
FORCE OF THE FOUNDATION AGREEMENT
The attachments to this Annex shall be <common state> legislation upon entry into force of
the Foundation Agreement, able to be amended in accordance with the Constitution.
ATTACHMENT 1: LAW ON THE ANTHEM, FLAG, INSIGNIA AND HONOURS
OF CYPRUS (AND THEIR USE)
[insert text]
ATTACHMENT 2: LAW ON CONDUCT OF EXTERNAL RELATIONS
Article 1 Composition of diplomatic missions of Cyprus
160
1. The heads of mission of Cyprus to the United Nations in New York, the United Nations in
Geneva, the European Union, Greece, Turkey, the United Kingdom, France, the United
States, Russia and China shall hail in equal numbers from each <component state>.
2. This Article shall be fully implemented no later than [three] years after entry into force of
the Foundation Agreement.
[insert further articles]
ATTACHMENT 3: LAW ON CONDUCT OF EUROPEAN UNION RELATIONS
[insert text]
ATTACHMENT 4: LAW ON CYPRIOT CITIZENSHIP
Article 1 General provisions
This Law determines the conditions for the acquisition [and loss] of Cypriot citizenship, in
accordance with the terms of the Foundation Agreement, the Constitution and international
and European Union standards.
Article 2 [Dual citizenship]
[insert article, if any.]
Article 3 Cypriot citizenship upon entry into force of the Foundation Agreement
1. Upon entry into force of the Foundation Agreement, the following persons shall be
considered citizens of Cyprus:
a. Any person who held Cypriot citizenship in 1960 and his or her descendants;
b. Any person who enjoyed permanent residence in Cyprus for at least seven years before
reaching the age of 18 and for at least one year during the last five years;
c. Any person who is married to a Cypriot citizen and has enjoyed permanent residence for
at least two years in Cyprus; and
d. Minor children of the persons in the above categories who enjoy permanent residence in
Cyprus.
In addition to the above, persons whose names figure on a list handed over to the Secretary-
General of the United Nations by each party to the Comprehensive Settlement by 10 March
2003 shall be citizens of Cyprus. Each side’s list may number no more than 33,000 persons,
inclusive of spouses and children, unless there are specific reasons preventing such spouses
and children from being considered citizens of Cyprus.Applicants shall be included on the
list based on the length of their residence in Cyprus.
Article 4 Acquisition of Cypriot citizenship
Cypriot citizenship is acquired in accordance with the provisions of this law:
a. Automatically by birth, where either parent is a Cypriot citizen;
b. By naturalisation; or
c. [insert additional articles, if any].
Article 5 Acquisition by naturalisation
161
A foreigner may submit a request for acquisition of Cypriot citizenship if s/he fulfils the
following conditions:
a. S/he has reached 18 years of age;
b. S/he has enjoyed permanent residence in Cyprus for at least seven consecutive years,
including for no less than four years after entry into force of the Foundation Agreement,
before submitting a request;
c. [S/he has knowledge of one of the official languages of Cyprus];
d. S/he is not the object of a security measure or a protective measure to remove him/her
from Cyprus undertaken by an authority of the <common state> or the <component states>
in accordance with their respective laws; and
e. S/he was not sentenced to a term of imprisonment for a premeditated criminal act for
longer than one year within seven years of the submission of the request.
Article 6 Acquisition by facilitated naturalization
Cypriot citizenship may be acquired through facilitated naturalisation:
a. Upon request, by spouses of persons who have or acquire Cypriot citizenship in
accordance with these provisions, provided they have been married for at least two years; or
b. Automatically by minor children of persons who acquire Cypriot citizenship in
accordance with these provisions.
Article 7 Loss of Cypriot citizenship
[insert article, if any]
Article 8 Passports
1. The Citizenship Board shall issue passports to Cypriot citizens in accordance with these
provisions.
2. During an interim period of [insert number of days], the Citizenship Board shall stamp
travel documents of citizens issued prior to entry into force of the Foundation Agreement,
testifying to the recognition of these documents by Cyprus.
Article 9 The Citizenship Board
1. The Citizenship Board shall be composed of three persons hailing from each <component
state> and the chairs shall rotate on an annual basis.
2. For the first two years of its operation, the Citizenship Board shall, in addition, comprise
two non-Cypriots who are not citizens of Greece, Turkey or the United Kingdom. The non-
Cypriots may simultaneously serve on the Aliens Board.
3. The members of the Citizenship Board shall be appointed by the Presidential Council and
confirmed by Parliament by special majority.
Article 10 Implementation of this law
1. The Citizenship Board shall be entrusted with the implementation of this law and shall
adopt rules and regulations for this purpose.
162
2. The Citizenship Board shall appoint and supervise agents who shall process requests
relating to Cypriot citizenship, in accordance with this law and its rules and regulations.
Article 11 Review of decisions on citizenship
1. There shall be a right of appeal to the Citizenship Board from decisions by agents of the
Board regarding citizenship.
2. Decisions of the Citizenship Board are subject to review by the Supreme Court.
Article 12 Transitional rules and regulations
Until the <common state> Parliament adopts detailed rules and regulations governing
citizenship, the Citizenship Board shall adopt such rules and regulations in accordance with
these provisions and the abovementioned international instruments, bearing in mind the
obligations of Cyprus under the Treaty of Accession to the European Union.
[insert further articles]
ATTACHMENT 5: LAW ON ALIENS, IMMIGRATION AND ASYLUM
Article 1 General provisions
This Law prescribes the conditions for residency, immigration and asylum, in accordance
with the terms of the Foundation Agreement, the Constitution and international and
European Union standards.
Article 2 Entry and residency rights of Greek and Turkish nationals
1. Cyprus shall grant equal treatment to Greek and Turkish nationals with respect to entry
and residency rights to the extent permissible under European Union law and the conditions
of accession of Cyprus to the European Union.
2. The Aliens Board shall not authorise further immigration of Greek nationals if the number
of permanent residents who are Greek nationals has reached 10 % of the number of resident
Cypriot citizens who hold the internal <component state> citizenship status of the Greek
Cypriot <component state> nor shall it authorize further immigration of Turkish nationals if
the number of permanently resident Turkish nationals has reached 10% of the number of
resident Cypriot citizens who hold the internal <component state> citizenship status of the
Turkish Cypriot <component state>.
3. Upon entry into force of the Foundation Agreement, the Aliens Board shall authorize the
<component states> to grant permanent residence rights to nationals of Greece and Turkey
up to the level agreed in the previous paragraph. Persons who do not receive permanent
residence may apply for financial assistance to relocate to their country of origin if they have
lived in Cyprus for no less than [five] years. Such assistance shall be in the form of cash
grants payable on their arrival in their country of origin, within five years of entry into force
of the Foundation Agreement. The amount of the grant shall be in accordance with a scale,
based on a figure of no less than 10,000 Euros for a household of four.
Article 3 Asylum
The Aliens Board shall grant asylum in accordance with the 1951 Geneva Convention on the
Status of Refugees and its 1967 Protocol, the 1997 Dublin Convention on Asylum Seekers,
the 1950 European Convention for the Protection of Human Rights and Fundamental
163
Freedoms and its additional protocols which are in force for Cyprus, as well as other
relevant international instruments in force for Cyprus.
Article 4 The Aliens Board
1. The Aliens Board shall be composed of three persons hailing from each <component
state> and the chairs shall rotate on an annual basis.
2. For the first two years of its operation, the Aliens Board shall, in addition, comprise two
non-Cypriots who are not citizens of Greece, Turkey or the United Kingdom. The non-
Cypriots may simultaneously serve on the Citizenship Board.
3. The members of the Aliens Board shall be appointed by the Presidential Council and
confirmed by Parliament by special majority.
Article 5 Implementation of this law
1. The Aliens Board shall be entrusted with the implementation of this law and shall adopt
rules and regulations for this purpose.
2. The Aliens Board shall appoint and supervise agents who shall process requests relating
to immigration, asylum, deportation or extradition in accordance with this law and its rules
and regulations.
Article 6 Review of decisions on immigration, asylum, deportation and extradition
1. There shall be a right of appeal to the Aliens Board from decisions by agents of the Board
regarding immigration, asylum, deportation or extradition.
2. Decisions of the Aliens Board are subject to review by the Supreme Court.
Article 7 Transitional rules and regulations
Until the <common state> Parliament adopts detailed rules and regulations governing
immigration, asylum, deportation and extradition, the Aliens Board shall adopt such rules
and regulations in accordance with these provisions and the abovementioned international
instruments, bearing in mind the obligations of Cyprus under the Treaty of Accession to the
European Union.
[insert further articles]
ATTACHMENT 6: LAW ON THE CENTRAL BANK
Part I: TRANSITIONAL PROVISIONS
Article 1 Exchange of deposits of citizens and residents of Cyprus
The Central Bank of Cyprus shall exchange deposits held by citizens and residents of
Cyprus in Turkish lira in banks in Cyprus into Cyprus pounds at the rate at which the Bank
of Turkey shall credit the relevant amounts to the Bank of Cyprus in Euros.
[insert further articles]
ATTACHMENT 7: LAW ON <COMMON STATE> TAXATION AND FINANCES
Article 1 Transfer to <component states>
164
1. The <common state> shall confer upon the <component states>, in proportion to their
population, no less than 50% of revenue from indirect taxation which is not transferred to
the European Union.
2. The <common state> shall spend no less than 5% of revenue from indirect taxation which
is not transferred to the European Union to finance cooperative endeavours between the
<component states> or between municipalities located in different <component states>.
[insert further articles]
ATTACHMENT 8: LAW ON <COMMON STATE> BUDGET
Article 1 Carry over of previous budget
If Parliament is unable to approve a budget before the beginning of the fiscal year, the
budget of the previous year, adjusted by inflation minus 1%, shall be carried on to the next
fiscal year, unless the Supreme Court in the exercise of its deadlock resolving power decides
otherwise.
[insert further articles]
ATTACHMENT 9: LAW ON INTERNATIONAL TRADE, CUSTOMS AND EXCISE
[insert text]
ATTACHMENT 10: LAW ON AVIATION AND AIRSPACE MANAGEMENT
[insert text; text shall take into account the vital interests and legitimate concerns of
neighbouring states, the geographical position of the island of Cyprus in the Eastern
Mediterranean, the terms of treaties binding on Cyprus upon entry into force of the
Foundation Agreement, and the relevant principles and rules of international law]
ATTACHMENT 11: LAW ON INTERNATIONAL NAVIGATION, TERRITORIAL
WATERS, AND CONTINENTAL SHELF
[insert text; text shall take into account the vital interests and legitimate concerns of
neighbouring states, the geographical position of the island of Cyprus in the Eastern
Mediterranean, the terms of treaties binding on Cyprus upon entry into force of the
Foundation Agreement, and the relevant principles and rules of international law]
ATTACHMENT 12: LAW ON WATER RESOURCES
[insert text; text shall include provisions ensuring that the natural water resources of Cyprus
shall be equitably shared between the <component states>.
ATTACHMENT 13: LAW ON NATURAL RESOURCES
[insert text]
ATTACHMENT 14: LAW ON POSTAL SERVICES
[insert text]
ATTACHMENT 15: LAW ON COMMUNICATIONS
[insert text]
ATTACHMENT 16: LAW ON METEOROLOGY
165
[insert text]
ATTACHMENT 17: LAW ON WEIGHTS AND MEASURES
[insert text]
ATTACHMENT 18: LAW ON INTELLECTUAL PROPERTY
[insert text]
ATTACHMENT 19: LAW ON ANTIQUITIES
[insert text]
ATTACHMENT 20: LAW ON ELECTION TO POPULARLY ELECTED
<COMMON STATE> OFFICES
[insert text; text shall include privisions on eligibility and incompatibility for members of
<common state> institutions]
ATTACHMENT 21: LAW ON <COMMON STATE> IMMUNITIES AND
EXEMPTIONS
[insert text]
ATTACHMENT 22: LAW ON <COMMON STATE> ADMINISTRATION
[insert text]
ATTACHMENT 23: LAW ON OFFICIAL LANGUAGES
[insert text]
ATTACHMENT 24: LAW ON <COMMON STATE> POLICE AND JOINT
INVESTIGATION AGENCY
[insert text]
ATTACHMENT 25: LAW ON LEGISLATIVE PROCEDURE AND ON
PROCEDURE FOR AMENDMENTS OF THE CONSTITUTION
[insert text; should include, inter alia, regulation of procedure for consultation of
<component state> governments and other interested sectors of society.]
ATTACHMENT 26: LAW ON ADMINISTRATION OF JUSTICE
Article 1 Judges of the Supreme Court
1. The Supreme Court judges shall not hold any other public office in the <common state>
or either <component state>.
2. The judges shall not serve beyond their 75th birthday.
3. The Presidential Council shall appoint the judges from among the candidates listed by the
Judiciary Board, three judges hailing from each of the <component states> and three non-
Cypriot judges who shall not be citizens of Greece, Turkey or the United Kingdom.
4. In case of a vacancy, the Presidential Council shall appoint a replacement for the
remainder of the term of office upon suggestion of the Judiciary Board, without altering the
composition of the Court as prescribed in this Article.
166
Article 2 The Chief Justice
The Supreme Court Judges shall elect from among their number a Chief Justice for a
renewable three-year term of office.
Article 3 Seniority of judges
The Chief Justice shall be considered the most senior Supreme Court judge. Among the
other judges, seniority shall be determined firstly by time served in office and by age in case
of equal time served.
Article 4 Judiciary Board
1. The Judiciary Board shall comprise the three most senior <common state> Supreme Court
judges, each being the most senior of the group of judges from each of the <component
states> and the non-Cypriot judges respectively; the Attorney-General and Deputy Attorney-
General of the <common state> and the Attorney-General, the head of the highest court and
the President of the Bar Association of each <component state>.
2. If the most senior judge from any group in the transitional Supreme Court is also the head
of the highest <component state> court, the second most senior judge from the relevant
group shall take his/her place on the Judiciary Board.
3. The Judiciary Board shall decide on a list of names by a two-thirds majority.
Article 5 Partial periodic renewal of the Supreme Court
1. To ensure partial periodic renewal of the Supreme Court, the terms of office of the
original members shall be as follows:
a. Three years for one judge from each <component state> as well as one non-Cypriot judge;
b. Six years for one judge from each <component state> as well as one non-Cypriot judge;
and
c. Nine years for one judge from each <component state> as well as one non-Cypriot judge.
2. If the judges in each group cannot agree among themselves who shall hold each term of
office, a lot shall be drawn among each group of judges.
Article 6 Transitional Supreme Court
1. The provisional Judiciary Board shall be composed of the Attorney-General, the head of
the highest court and the President of the Bar Association of each <component state>.
2. The Cypriot judges may maintain any functions as <component state> judges during their
one-year term of office on the transitional Supreme Court to the extent that their tasks at the
Supreme Court shall allow it. They shall give priority to their tasks as judges of the Supreme
Court of Cyprus.
3. The non-Cypriot judges on the transitional Supreme Court shall be remunerated like
judges of the International Court of Justice.
[insert further articles]
ATTACHMENT 27: LAW ON <COMMON STATE> OFFENCES
167
[insert text; i.e. criminal code on terrorism, drug trafficking, money laundering, organized
crime and offences against <common state> laws]
ATTACHMENT 28: LAW ON IMPEACHMENT
[insert text; text shall include provisions that cases alleging impeachment shall be referred to
the Supreme Court; the Supreme Court shall determine the appropriate punishment]
DRAFT ANNEX IV: COOPERATION AGREEMENTS BETWEEN <COMMON
STATE> AND <COMPONENT STATES> UPON ENTRY INTO FORCE OF THE
FOUNDATION AGREEMENT
The attachments to this Annex shall be Cooperation Agreements between the <common
state> and the <component states> upon entry into force of the Foundation Agreement.
These agreements may be amended by agreement of the <common state> and both
<component states>.
ATTACHMENT 1: COOPERATION AGREEMENT ON EXTERNAL RELATIONS
[insert text]
ATTACHMENT 2: COOPERATION AGREEMENT ON EUROPEAN UNION
RELATIONS
Article 1 Scope of agreement
This agreement regulates decision-making and representation of Cyprus in European Union
matters which predominantly or exclusively fall within the competence of the <component
states>.
Article 2 Duty to inform
The <common state>shall inform the <component states> without delay on all issues
relating to European integration in areas of competence of the <component states>. This
duty shall include the transmission of:
a. Documents, reports, and notices of the organs of the European Union;
b. Documents, reports, and notices on informal meetings at ministerial level;
c. Documents and information on cases pending before the European Court of Justice; and
d. Reports of the permanent representation of Cyprus to the European Union.
Article 3 Decision-making
1. In matters referred to in Article 1, the <common state> shall consider opinions of the
<component states> given in due time. In case of consistent opinion of both <component
states> given in due time, this opinion shall be legally binding on the <common state> in
negotiations and voting. The <common state> may only deviate from this opinion if there
are mandatory reasons with regard to foreign affairs.
2. In the case of persistent inconsistencies in matters referred to in Article 1, coordination
with respect to the position of the <common state> shall be undertaken by the Coordination
Group. The Coordination Group shall comprise a representative of each of the members of
the Presidential Council in charge of Foreign Affairs and European Union relations, and
168
representative of each <component state>. The decisions of the Coordination Group shall be
binding on the relevant representative in the European Union.
3. The position taken by the Coordination Group may be changed only in exceptional
circumstances. If the position taken by the Coordination Group needs to be urgently adapted
in the course of a meeting of a European Union organ, the respective representative shall
immediately inform the Coordination Group. If a revised decision of the Coordination
Group cannot be obtained in time, the representative of Cyprus shall abstain, except in cases
where s/he has received clear freedom to choose the position that will most likely address
the general interests of Cyprus as a whole. It is understood that in such circumstances, the
vote given by the Cyprus representative will have been final.
Article 4 Representation
1. Cyprus may be represented in the European Union either by a representative of the
<common state> or a representative of a <component state>.
2. The representatives shall be appointed by the Presidential Council upon suggestion of the
Coordination Group.
3. The representatives of Cyprus in the Council of the European Union shall be notified to
its General Secretariat. Such representatives attending meetings shall have the exclusive
right to make legally binding declarations.
4. Cyprus will be represented in the European Parliament according to proportional
representation, provided that each <component state> is attributed no less that one third of
Cypriot seats in the European Parliament.
Article 5 Legal action
1. In case of an unlawful act or failure to act of organs of the European Union or another
member state concerning matters in the areas of competence of the <component states>,
Cyprus shall bring an action before the European Court of Justice upon request of the
<component state>. Such request is to be addressed to the Presidential Council and shall
include all information relevant to a legal action before the European Court of Justice.
2. The costs of such legal action shall be borne by the <component state> requesting the
action.
Article 6 Adaptation
The <common state> and the <component states> shall adapt this Agreement by consensus
to take account of further developments of European integration or other needs that may
arise.
Article 7 Presidency
Prior to Cyprus exercising the Presidency of the European Union, the Coordination Group
shall propose specific modalities to the Presidential Council.
Article 8 Disputes resulting from the application of this agreement
Any dispute resulting from the application of this Agreement shall be decided by the
Supreme Court of Cyprus.
[insert further articles]
169
ATTACHMENT 3: COOPERATION AGREEMENT ON POLICE MATTERS
[insert provisions on cooperation arrangements between <component state> police, between
<component state> police and <common state> police, and regarding joint investigation
agency; these provisions should create a cooperation committee; they should, inter alia,
address the issue of hot pursuit]
DRAFT ANNEX V: LIST OF INTERNATIONAL TREATIES BINDING ON
CYPRUS UPON ENTRY INTO FORCE OF THE FOUNDATION AGREEMENT
[insert list of treaties; Charter of the United Nations, Treaty of Establishment, Treaty of
Guarantee and Treaty of Alliance shall be included in the list; further treaties shall be listed
in accordance with the following guidelines:
• There shall be a presumption of inclusion of all multilateral instruments and all bilateral
instruments, other than with Greece and Turkey; either side may raise objections with
respect to a specific instrument provisionally listed on grounds of incompatibility with the
Comprehensive Settlement or the Foundation Agreement;
• Instruments with Greece and Turkey in areas not related to defence shall be examined and,
unless incompatible with the Comprehensive Settlement or the Foundation Agreement, shall
be included in the list;
• Instruments with Greece and Turkey on defence matters shall not be included in the list,
unless otherwise agreed.]
DRAFT ANNEX VI: TERRITORIAL ARRANGEMENTS
Article 1 Delineation of <component state> boundaries
1. The boundaries of the <component states> shall be as depicted in the attached map.
2. [insert text describing in detail the course of the agreed boundary]. In towns (namely
Nicosia and Famagusta), the final boundary shall be demarcated in such a way as to take
into account as an overriding concern the ownership of properties in the area of the
boundary. Functionality of street use and administration shall also be a consideration. Any
inconsistency between this description and the map shall be decided by consensus by a
committee, or, where they are unable to reach consensus, by the Supreme Court of Cyprus.
3. The committee shall comprise [insert figure] representatives of each <component state>
and at least one non-Cypriot. The committee shall be appointed upon entry into force of the
Foundation Agreement, and shall demarcate the boundary on the ground.
Article 2 Access and connecting roads
[indicative text to be modified in accordance with agreed map]
Applying to both suggested maps:
1. Civilian traffic on direct connecting roads between the main part of a <component state>
and a non-contiguous part, as well as on direct connecting roads through a non-contiguous
part of a <component state>, may only be restricted pursuant to an injunction of the
Supreme Court.
2. The road connecting Pyrogi and Athienou is under the territorial administration of the
Greek Cypriot <component state> for its entire length. The Turkish Cypriot <component
170
state> shall be entitled to construct an underpass or overpass for access to
Louroujina/Akincilar.
3. The Greek Cypriot <component state> shall be entitled to construct a road under its
territorial administration between Kontea and Kalopsida, across the territory administered by
the Turkish Cypriot <component state> south of Köüklia and to expropriate the necessary
land in exchange for full and effective compensation, in cooperation with the Turkish
Cypriot <component state>. The <component states> shall agree on the location of any
necessary underpasses or overpasses to be built at the expense of the Greek Cypriot
<component state>.
Article 4 Phasing of territorial adjustment
1. Areas within the agreed territorial boundaries of a <component state> which are subject to
territorial adjustment, while legally part of that <component state> upon entry into force of
the Foundation Agreement, shall be administered during an interim period no longer than
three years by the other <component state>, by which time, administration shall have been
completely transferred.
2. Administration shall be transferred in agreed phases as depicted on the attached map.
Transfer shall begin 90 days after entry into force of the Foundation Agreement with the
transfer of administration of the following largely uninhabited areas contiguous with the
remainder of the relevant <component state>: [insert description of areas]. Remaining areas
shall be transferred as follows: [insert transfer timeframes and arrangements for remaining
areas].
3. The <component states> shall render full cooperation to the United Nations which, in
conformity with its mandate, shall supervise activities relating to the transfer of areas subject
to territorial adjustment and contribute to the maintenance of a secure environment.
4. During the phasing period, the areas under the administration of the Greek Cypriot
<component state> and the Turkish Cypriot <component state> shall be clearly marked as
follows: [insert text]. During this period, the agreed crossing points shall be as follows:
[insert text]
Article 5 Current inhabitants
1. The following special arrangements shall safeguard the rights and interests of current
inhabitants of areas subject to territorial adjustment, and provide for orderly relocation to
adequate alternative accommodation (in accordance with Annex VII) in appropriate
locations where adequate livelihoods may be earned:
a. persons to be relocated shall be registered by household, including details of their current
occupation or means of livelihood;
b. communities may request to be relocated as a community;
c. persons with sufficient financial means shall vacate properties no later than [one] month
prior to the agreed date of transfer of administration of the relevant area;
d. persons without sufficient financial means shall receive no less than [three] months notice
of the date for relocation once alternative accommodation has been identified; during this
time they may access this alternative accommodation to prepare for their arrival;
171
e. persons to be relocated who do not have sufficient financial means shall be provided with
transport for the members of their household and their belongings, as necessary; and
f. special arrangement shall be made for families with young children, the elderly and the
disabled.
2. Persons other than Cypriot citizens who, pursuant to an administrative decision by an
authority in Cyprus, enjoyed permanent residence in areas subject to territorial adjustment
may apply for financial assistance to relocate to their country of origin. Such assistance shall
be in the form of cash grants payable upon their arrival in their country of origin, within
five years of entry into force of the Foundation Agreement. The amount of the grant shall be
in accordance with a scale, based on a figure of no less than 10,000 Euros for a household of
four.
Article 6 Relocation Board
1. Relocation pursuant to Article 5 shall be managed by a Relocation Board, comprising of
five persons, including one representative of each <component state> and three non-
Cypriots who are not citizens of Greece, Turkey or the United Kingdom and of whom one
shall be a United Nations representative. The latter is invited to chair the Board. The
Secretary-General of the United Nations is invited to appoint the non-Cypriot members of
the Board.
2. The <component states> shall each nominate a representative of their authority competent
for housing and property issues, their authority competent for employment/economic issues,
their <component state> police and each of the local authorities for the areas subject to
territorial adjustment, to cooperate and liaise with the relocation Board and attend extended
planning meetings at the request of the Board.
3. Among other responsibilities, the Relocation Board shall verify that alternative
accommodation is ready for inhabitation before setting dates for relocation. It shall initiate
arrangements with the competent authorities in the receiving municipalities to ensure that
persons relocating there are assisted in establishing a livelihood in those municipalities.
4. The Relocation Board shall also work closely with the Property Board regarding decisions
on reinstatement in the areas subject to territorial adjustment and the identification of
alternative accommodation. When planning the construction of alternative accommodation,
special consideration shall be given to requests of communities wishing to relocate as a
community.
5. The Relocation Board shall adopt rules and regulations in accordance with these
provisions. The <component states> shall fully respect and implement the decisions of the
Relocation Board in a timely manner, and adopt any necessary legislation or regulations to
ensure their enforcement.
Article 7 Properties
Properties located in areas subject to territorial adjustment shall be handled in accordance
with the provisions of Attachment 4 of Annex VII.
ATTACHMENT 1: MAP OF TERRITORIAL ADJUSTMENT
172
DRAFT ANNEX VII: TREATMENT OF PROPERTY AFFECTED BY EVENTS
SINCE 1963
Part I: GENERAL ARTICLES
Article 1 General provisions
1. The provisions in this Annex and its attachments deal with properties which were affected
as a consequence of intercommunal strife, military action or the unresolved division of the
island between December 1963 and entry into force of the Foundation Agreement and
introduces an extraordinary regime to deal with these properties. The provisions in this
Annex and its attachments will continue to apply to such properties until all matters covered
by these provisions have been closed by the Property Board or the Supreme Court.
2. Terms used in this Annex and its attachments are defined in Attachment 1.
3. Provisions of this Annex and its attachments shall be referred to hereinafter as 'these
provisions'.
Article 2 The Cyprus Property Board
These provisions, unless otherwise stated, shall be implemented by the Cyprus Property
Board. Its composition, powers and procedures, as well as the obligations of the <common
state> and the <component states> in relation to it, are further regulated in Attachment 2.
Article 3 Property in areas subject to territorial adjustment
Property located in areas subject to territorial adjustment is regulated by Attachment 4.
Where there are no specific provisions in Attachment 4, the other provisions of this Annex
shall apply.
Article 4 Religious sites
1. The Churches and Evkaf shall be entitled, without exception and within three years of
entry into force of the Foundation Agreement, to reinstatement of any affected property
owned by them which was used as a religious site in 1963 or 1974.
2. This Article shall not limit the right of Churches and Evkaf to claim compensation in lieu
of reinstatement for any affected property under these provisions.
Part II: REGULATION OF EXERCISE OF PROPERTY RIGHTS
Article 5 Suspension of dealings, proceedings or alterations with respect to affected
property
1. Any transaction, dealing, or any proceeding in any court or legal or administrative body,
or any physical alterations (apart from minor or emergency maintenance), with respect to
any affected property shall be suspended or prohibited upon entry into force of the
Foundation Agreement, until the Property Board:
a. Authorises such dealing, proceeding or physical alteration to continue or occur;
b. Refers the dealing or proceeding to another competent court or authority; or
c. Makes a final determination in relation to the property.
173
2. The <common state> and the <component states> shall, pursuant to Article 37 of the 1950
European Convention for the Protection of Human Rights and Fundamental Freedoms,
request the European Court of Human Rights to strike out any proceedings currently before
it concerning affected property.
Article 6 Claims and applications
1. A dispossessed owner shall be entitled to claim compensation for his/her title to property
or the reinstatement of his/her property or apply for assistance in arranging the sale, long-
term lease or exchange of his/her property.
2. Current users of affected properties who are themselves dispossessed owners or persons
who own significant improvements to affected properties may apply to receive title to such
properties.
3. Current users of properties to be reinstated may apply to benefit from the special measures
detailed in Attachment 3.
4. All such claims and applications shall be made to the Property Board within the time limit
specified and shall be processed and determined in accordance with these provisions.
5. All payments required as a condition for the transfer of title or reinstatement shall be
made to the Property Board within three years of the relevant decision of the Property
Board, unless the decision specifies an earlier date. Transfer of title or reinstatement shall
not take effect until all stipulated payments are made in full. Failure to make payments
within the specified period may result in loss of or modifications to rights with respect to the
property.
Article 7 Liability for damage
Persons responsible for serious damage to or destruction of properties shall be liable to the
dispossessed owner and/or the Property Board for the cost of the damage up to the market
value of the property. In addition, the Property Board may fine such persons and take other
punitive measures, including modifying decisions previously made in their favour.
Section A: Compensation
Article 8 Entitlement to full and effective compensation
1. Any dispossessed owner shall be entitled to claim full and effective compensation as
determined by the Property Board in accordance with international standards (hereinafter
referred to as ''compensation'') in exchange for transfer of title to the affected property to the
Property Board.
2. Entitlements to compensation shall be assessed and paid by the Property Board at current
value unless otherwise specified in these provisions.
3. Compensation shall be paid in the form of compensation bonds drawn on a compensation
fund. The establishment of the Compensation Fund, issuing and use of bonds shall be
regulated by the provisions in Attachment 2.
4. Dispossessed owners of properties which, according to the following provisions, are not
reinstated shall be entitled to compensation.
Article 9 Property owned by institutions
174
Title to affected properties, other than religious sites, which are owned by institutions shall
be transferred to the Property Board in exchange for compensation.
Article 10 Property used for public benefit purposes
Title to an affected property which is being used for a purpose in the public benefit upon
entry into force of the Comprehensive Settlement which objectively justifies compulsory
acquisition shall be transferred to the <common state> or the relevant <component state> in
exchange for payment of the current value by the relevant authority to the dispossessed
owner through the Property Board.
Article 11 Property required for military purposes
Title to any affected property which is specified in the Additional Protocols to the Treaty of
Alliance, or any attachment thereto, as being required for military purposes shall be
transferred to the <component state> in which it is located, in exchange for payment of the
current value by the relevant <component state> through the Property Board.
Article 12 Property currently used by dispossessed owners
1. A dispossessed owner who is the current user of an affected property of similar current
value to a property of which s/he was dispossessed and has been using the affected property
on a continuous basis for at least ten years, may apply to the Property Board to receive title
to that property in exchange for title to the property of which s/he was dispossessed.
2. The application shall be granted if the current value of the affected property no greater
than 50% more than the current value of the property of which s/he was dispossessed.
3. If the current value of the affected property is more than 50% greater than the current
value of the property of which the current user was dispossessed, the Property Board shall
assist the dispossessed owner and the current user to reach an amicable agreement. If this
fails, the Property Board may grant or refuse the exchange, taking into account the
arguments of both sides, or partition the property as appropriate.
4. If the current value of the affected property is less than that of the property of which the
current user was dispossessed, s/he may claim compensation for the difference in value.
5. If the current value of the affected property is more than the current value of the property
of which the current user was dispossessed, s/he shall pay the difference to the Property
Board prior to the transfer of title.
Article 13 Property currently used by subsequent purchasers from dispossessed
owners
1. Any purchaser (or his/her successors in title) of an affected property, which was assigned
to a dispossessed owner (hereinafter ''the vendor'') and was of a similar current value to a
property of which the vendor was dispossessed, shall have the same rights and obligations as
the vendor would have had according to Article 12 with respect to the affected property,
provided that s/he and the vendor and any predecessors in title have collectively been current
users of the affected property on a continuous basis for at least ten years. Title to the
property of which the vendor was originally dispossessed shall be transferred to the Property
Board; if the current value of the affected property is less than that of the property of which
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the vendor was originally dispossessed, the vendor may claim the difference in
compensation.
2. The above provision does not apply if the Property Board cannot obtain title to the
property of which the vendor was dispossessed because the vendor has already legally
disposed of it.
Article 14 Significantly improved property
The owner of a significant improvement to an affected property may apply to receive title to
that property, in exchange for payment of the current value of the affected property without
the improvement. The Property Board shall order transfer of title after payment of
compensation to the dispossessed owner at the current value for his/her interest in the
property.
Section B: Reinstatement into possession
Article 15 Eligibility for reinstatement
Affected properties which do not fall into the above categories shall be generally eligible to
be reinstated.
Article 16 Agreed levels of reinstatement
1. In either <component state>, no more than 9%, and in any given municipality or village,
no more than 14% of the total land area and of the number of residences shall be reinstated
to persons hailing from the other <component state>.
2. Eligible claimants shall be awarded reinstatement based on priority in descending order of
age, until the agreed levels are reached.
3. These limitations shall not apply to religious sites or to villages which were
predominantly inhabited by Maronites in 1974 or the Karpas villages of
Rizokarpaso/Dipkarpaz, Agialousa/Yeni Erenkoy, Agia Trias/Sipahi, Melanarga/Adacay.
Article 17 Moratorium for reinstatement
No order of the Property Board shall require reinstatement of affected property to a
dispossessed owner before a date which is:
a. Three years after the Foundation Agreement enters into force, for property which is vacant
at that date; or
b. Five years after the Foundation Agreement enters into force, in all other cases.
Article 18 Improvements on reinstated property
1. The owner of any improvement with a market value of more than 10% of the current
value of a property to be reinstated may apply for compensation for his/her interest in the
property.
2. The dispossessed owner shall be entitled to retain any improvement on the affected
property after reinstatement, provided s/he pays the market value of the improvement to the
Property Board.
3. The dispossessed owner shall not be required to make such a payment if s/he satisfies the
Property Board that the improvement is inappropriate for or irrelevant for his/her intended
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future use of the property for his/her own purposes, provided the intended future use is more
or less similar to its use prior to dispossession. If the Property Board subsequently finds that
the dispossessed owner or any successor in title makes use of the improvement, the Property
Board may pursue him/her to recover the amount of compensation paid to the owner of the
improvement under paragraph 1 of this Article.
Section C: Sale, exchange and long-term lease
Article 19 Option to sell, exchange or lease
1. Properties eligible for reinstatement may be sold, exchanged or leased on a long-term
basis (20 years or longer) to current users or other people hailing from the <component
state> in which the property is located, at any time prior to the final determination on
reinstatement, in accordance with these provisions.
2. Dispossessed owners and current users may seek the assistance of the Property Board
with the sale, exchange or lease of such properties.
Article 20 Incentives for dispossessed owners to sell, exchange or lease
Dispossessed owners shall be offered incentives to sell, exchange or lease on a long-term
basis their properties according to Article 18, including:
a. Exemptions for such properties from being counted for the purposes of determining when
agreed levels of reinstatement have been reached;
b. Exemptions from taxes, governmental fees, charges and duties payable on signing of
instruments, or on completion and registration of transfers or leases of such properties;
c. Exemptions or substantial reductions in taxes on capital gains derived from transfers or
from rental income under such leases;
d. Exemptions from any incidental taxes, governmental fees, charges and duties relating to
sale, exchange or lease of such properties;
e. Exemptions from property taxes for the duration of such leases; and
f. Such other additional incentives as the <common state> and the <component states> may
choose to provide.
Part III: LOSS OF USE
Article 21 Compensation for loss of use
Any claims for compensation for loss of use of an affected property for any period
commencing with dispossession shall be considered by the <component state> from which
the claimant hails, taking into account:
a. Benefits previously enjoyed by the dispossessed owner on the grounds of his/her
displacement; and
b. Any entitlements received by or payable to the dispossessed owner, whether before or
after the Foundation Agreement, for the period of lost use.
Part IV: JUDICIAL REVIEW
Article 22 The Property Court
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1. A Property Court shall be established with power to conduct final judicial review of
decisions of the Property Board.
2. The Property Court shall be composed of an uneven number of judges. This number shall
be specified by the Chief Justice of the Supreme Court after consultation with members of
the Supreme Court, and shall include an equal number of judges from each of the
<component states> and no less than three non-Cypriot judges who are not citizens of
Greece, Turkey or the United Kingdom. The Chief Justice and judges of the Property Court
shall be chosen in the same manner and for the same term of office as judges of the Supreme
Court, unless the Supreme Court decides otherwise.
3. Decisions of the Property Board shall not be subject to appeal or challenge in any
<component state> court or otherwise, except by way of judicial review by the Property
Court in accordance with the law and these provisions.
4. Decisions of the Property Court shall not be subject to further review or appeal to the
Supreme Court.
5. An application for judicial review of a Property Board decision may be made to the
Property Court by any party with a legal interest in the decision or the property in question,
within 60 days of publication of the decision by the Property Board in accordance with its
rules.
6. The Property Court shall have power to levy fees upon parties for procedural steps in
initiating and contesting matters before it.
7. The Property Court shall continue in operation until such time as the Supreme Court may
decide to assume its functions.
Part V: AMENDMENT
1. These provisions may be amended by the executive heads of the <component states>
acting by consensus and with the approval of the legislatures of both <component states>.
2. The text of any proposed amendment shall be agreed between the executive heads of the
<component states> and submitted in identical form to each <component state> legislature.
It shall come into force 30 days after its approval by both legislatures.
ATTACHMENT 1: DEFINITIONS
Article 1 Definitions
In Annex VII and its attachments, the following terms are defined as:
1. Affected property - immovable property in Cyprus which the owner, being a natural or
legal person, left or of which s/he lost use and control as a consequence of intercommunal
strife, military action or the unresolved division of the island between December 1963 and
entry into force of the Foundation Agreement, and which has not since been reinstated to the
owner (or his/her heir, personal representative or successor in title), and over which s/he has
not regained use and control. Affected property shall not include any property which was
voluntarily sold, transferred or otherwise permanently disposed of by the owner, to a person
who was able to gain effective control over the property, including through compulsory
acquisition or expropriation (provided such compulsory acquisition or expropriation was
carried out in accordance with international standards, including through payment of full and
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effective compensation). The onus of proof of any such voluntary transfer or lawful
expropriation shall lie with the transferee or his/her successor in title. In the absence of
evidence to the contrary for the individual case in question, dispossession shall be presumed
to have been unlawful and/or involuntary. People who are not successors in title of
dispossessed owners and have not been able to gain effective control over the relevant
affected property shall be treated in the same manner as the dispossessed owners themselves
would be.
2. Alternative accommodation - residential housing for people affected by the return and
reinstatement of owners, who satisfy eligibility requirements. Such accommodation shall at
least be of a level which is comfortable by reasonable modern standards (including being
connected to public utilities where available, such as water and electricity); provides a
reasonable ratio of living space for the number of household members which it must
accommodate; is no less than [insert minimum number of square metres for an individual
and minimum number of square metres for each additional person]; and, where practicable,
is comparable to the residence which the recipient is vacating or which s/he possessed prior
to his/her displacement (up to a maximum standard to be defined in regulations of the
Property Board).
3. Current user - a person who has been granted a form of right to use or occupy property by
an authority under a legal or administrative process established to deal with property
belonging to dispossessed owners, or any member of his/her family who has a derivative
right to use or occupy such property, or his/her heir or successor in title. The definition does
not include any person who occupies or uses a property without any legal, administrative or
formal basis, nor any person using or occupying property under a lease contract from a
private person, nor any military force, body or authority.
4. Current value - value of a property at time of dispossession, plus an adjustment to reflect
appreciation based among other things on increase in average sale prices of properties in
Cyprus in comparable locations in the intervening period up to the date of entry into force of
the Foundation Agreement. The current value of a property shall be assessed as at the date of
entry into force of the Foundation Agreement. This value shall bear interest, at the same rate
as interest on compensation bonds, from the date of entry into force of the Foundation
Agreement until compensation bonds are issued.
5. Dispossessed owner - a natural or legal person who, at the time of dispossession, held a
legal interest in the affected property as owner or part owner, or his/her legal heir, personal
representative or successor in title, including by gift.
6. Institutions - entities other than natural persons, including privately or publicly-owned or
controlled bodies, such as public or private trusts, religious institutions; military forces and
companies (other than sole corporations).
7. Market rent - the amount of rent which could be charged for a property on the open
market, based on an assessment of market rents paid for comparable properties in
comparable locations at the time of assessment.
8. Market value - the amount for which a property could be sold on the open market, based
on an assessment of purchase prices or amounts paid for comparable propertie] in
comparable locations at the time of assessment.
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9. Original state - the state or condition of affected property at the time of dispossession of
the dispossessed owner, not including improvements subsequently made by any party,
assessed at current value.
10. Property - immovable property, being land and fixtures attached to land (or an ownership
interest or undivided share in such a property)].
11. Reinstatement - restitution through the award of legal and physical possession to the
dispossessed owner, so as to enable him/her to exercise effective control over such property,
including use for his/her own purposes.
12. Religious site - a mosque, church, chapel, cemetery, monastery, shrine, tomb or other
place of worship.
13. Significant improvement - an improvement (including any new construction on vacant
land) to an affected property, which was made between the time of dispossession and 31
December 2001, or based on a building permit issued prior to 31 December 2001, and of
which the market value is greater than the value of the affected property in its original state.
For the purposes of determining the ownership of the improvement, it shall not be
considered as having attached to the land; the owner of the improvement, is the natural or
legal person who paid for the improvement or his/her heir, personal representative or
successor in title. The burden of proof concerning the value, ownership and date of
construction of any improvement lies on the owner of the improvement.
14. Sufficient financial means - income (taxable or otherwise) of more than X (X being the
amount required to meet mortgage payments) or wealth of more than Y (Y being the amount
required to purchase the currently-used property or alternative accommodation).
Entitlements and interests in affected property shall be taken into account for the purposes of
calculating wealth. The Property Board shall determine the amounts of X and Y and revise
the amounts annually, based on market figures and expert input.
15. Use for own purposes - use and enjoyment of affected property by a person, his/her
family member, employee or representative (other than a tenant) through regular personal
use (not necessarily as a permanent residence). Use for own purposes shall not include
selling, renting, transferring by gift or otherwise disposing of an interest in affected property.
16. Vacant - not used or occupied by a current user or any member of his/her family or
successor in title who has a derivative right to use or occupy such property.
ATTACHMENT 2: THE CYPRUS PROPERTY BOARD AND COMPENSATION
ARRANGEMENTS
Section A: Establishment, operation, powers, staff and costs of The Cyprus Property
Board
Article 1 Establishment and conduct of the Cyprus Property Board
1. There shall be an independent, impartial, administrative body known as the Cyprus
Property Board (hereafter the 'Property Board').
2. The Property Board shall act in accordance with the principles and terms of the
Foundation Agreement and in particular with these provisions.
Article 2 Membership
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1. The Property Board shall be composed of a total of seven members, being two members
hailing from each <component state> and three non-Cypriot members who are not citizens
of Cyprus, Greece, Turkey or the United Kingdom.
2. Members shall be legally qualified and of high moral and professional standing. Members
shall be prohibited from holding any other <common state> or <component state> office
during their membership of the Property Board.
3. The Cypriot and non-Cypriot members’ remuneration shall be at the level of nine-tenths
of the salary of the Cypriot and non-Cypriot judges of the Supreme Court respectively.
4. Within 30 days of entry into force of the Foundation Agreement, the Co-Presidents shall
appoint by consensus the initial members of the Property Board. For subsequent
appointments, the members shall be appointed by the executive heads of the <component
states> acting by consensus.
5. The members shall elect from among their number a presiding member, who shall preside
over the Board for a period of three years or until the end of his/her term, whichever is the
sooner.
6. The members of the Property Board shall be appointed for a term of three years. At the
end of each three-year term, each member shall be replaced or reappointed for a further
term. Members may resign with 90 days prior notice. The Supreme Court may remove any
member upon the application of the <common state> or either <component state> in case of
misconduct or grave breach of the member's duties. In case of any vacancy, a new member
shall be appointed within 45 days of notice of the vacancy or of its occurrence, whichever is
the sooner.
7. If there is failure to agree on the appointment of any member of the Property Board in the
time specified under these provisions, the Secretary-General of the United Nations or his
representative, is invited to appoint a replacement member to hold office for a minimum of
eighteen calendar months.
Article 3 Powers
The Property Board body shall have the power to:
a. Receive and rule on claims for affected property;
b. Decide any question or dispute before it regarding claims, entitlements of dispossessed
owners, current users or owners of improvements, allegations of sale under duress, property
valuation, right of first refusal or title to or other rights in respect of affected property;
c. Decide in individual cases on, and set and revise scales and values for the purposes of
calculating compensation for affected property and improvements; rent, sale and purchase
amounts; entitlements to alternative accommodation and other amounts under these
provisions;
d. Demand and receive prompt, full and unhindered access to any and all records, archives,
databases or other information regarding property in Cyprus, and to any and all property in
Cyprus for the purpose of inspection, valuation and assessment related to its tasks and
operation, and to receive copies or extracts of information, without fee, tax or other charge;
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e. Order or procure the registration of interests in affected property or correction of entries in
the relevant Land Titles Register or other records, based on entitlements under these
provisions or other applicable law;
f. Refer any question arising in respect of an affected property to another competent court or
authority, as appropriate and for finalisation or any interim or other ruling;
g. Order the suspension of any proceeding in any court or other authority, or any physical
alterations (other than minor or emergency maintenance) with respect to affected property;
h. Order or procure the completion of any steps as required to transfer interests in affected
property or, where necessary, partition affected property, under these provisions or other
applicable law;
i. Issue legally binding orders to competent <common state> or <component state> bodies as
required to implement its decisions;
j. Acquire and deal with affected property in a responsible manner under these provisions,
including the administration and disposal of affected property transferred to it or coming
under its control;
k. Facilitate the provision and allocation of alternative accommodation;
l. Assist persons, upon their request, in the sale, lease or exchange of affected property;
m. Collect damages from and issue fines against any persons found responsible for
damaging or destroying affected property;
n. Administer and/or supervise a preferential loans scheme under these provisions;
o. Adopt such rules, regulations, procedures, forms and other instruments as required for the
performance of its functions;
p. Consult and seek recommendations from qualified experts to assist in the performance of
its functions, including experts in valuation, economics, law, property markets, quantity and
land surveying, registration, mapping and others; and
q. Perform other tasks, including those which may be assigned to it by the <common state>
or either <component state>, or which are incidental or related to the performance of its
functions.
Article 4 Obligations of the <common state> and the <component states> in respect of
the Property Board
1. The <common state> and the <component states> shall take all steps as required to
implement these provisions in good faith and in a timely manner.
2. In order to fulfil their obligations under these provisions, the <common state> and the
<component states> shall, among other things:
a. Cooperate fully with the Property Board, and respect, recognize and comply with its
decisions in accordance with their legally binding nature including by officially publishing
its decisions at the request of the Property Board;
b. Implement the decisions of the Property Board fully and promptly;
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c. Cooperate with other relevant institutions dealing with affected property under these
provisions;
d. Provide the Property Board with prompt, full and unhindered access to any and all
records, archives, databases or other information regarding property in Cyprus, and to any
and all property in Cyprus for the purpose of inspection, valuation and assessment related to
its tasks and operation, and to provide copies or extracts of information, without fee, tax or
other charge;
e. Adopt special measures, including at the request of the Property Board, to ensure the
physical protection of property from damage or destruction; and
f. Act otherwise as necessary to respect property rights.
3. The <common state> and the <component states> shall adopt and enforce any legislation,
regulations, procedures, orders, instructions, practice notes and other legislative instruments
as necessary or appropriate to acknowledge the binding force of Property Board decisions,
and ensure their enforcement and implementation, including as necessary through local
administrative bodies, police or other agents. Such legislative instruments shall be drafted in
consultation with the Property Board.
4. In case the <common state> or a <component state> fails within
one year after entry into force of the Foundation Agreement to adopt laws for enforcement
and implementation of decisions of the Property Board, the Property Board shall issue rules
providing for enforcement and implementation of its decisions, which shall come into force
as binding legislative instruments of the <common state> or the relevant <component state>,
and which shall remain in force until the <common state> or the relevant <component state>
enacts effective laws in fulfilment of its obligations under these provisions.
Article 5 Obligations of <common state> and <component state> courts and competent
authorities
1. The courts, administrative bodies and other authorities of the <common state> and the
<component states> shall cooperate with the Property Board and acknowledge the legally
binding force of its decisions, and shall take any steps as necessary to implement and
enforce its decisions.
2. If the Property Board refers a question to a court or other competent authority, such court
or authority shall hear and determine the claim on its merits and shall not reject or refuse to
decide the claim solely on the grounds that the claim is out of time or that any applicable
limitation period has expired.
3. The <component states> shall put land for alternative accommodation at the disposal of
the Property Board, including, where necessary, through expropriation (against full and
effective compensation). In allocating such land, the <component states> shall take into
account the need for relocating persons, in particular those from areas subject to territorial
adjustment, to be able adequately to earn their livelihood.
Article 6 Staff
The Property Board shall employ a director who, under the supervision of the members of
the Property Board, shall be responsible for the administration and management of the work
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of the Property Board. The director may employ staff qualified in law, valuation, land titles,
records management, economics, accountancy, information technology, mediation and other
forms of dispute resolution, property management and other technical and relevant fields, to
assist and perform the work of the Property Board.
Article 7 Costs
1. The costs of establishing and running the Property Board shall be met by the <common
state>, which may request contributions from the guarantor states and other international
donors.
2. The Property Board shall prepare an annual budget for its running costs in accordance
with the relevant public service scales of remuneration and, in the case of non-Cypriot
employees, United Nations guidelines. The <common state> shall pay the budgeted amount
for such running costs to the Property Board before the beginning of each financial year.
Any surplus funds at the end of each financial year shall be repaid to the <common state>,
and any shortfall shall be met by the <common state>.
3. The Property Board shall submit its running costs and other accounts to independent audit
each financial year, and the audit report shall be publicly available.
4. Should any additional task or function be assigned to the Property Board, the <common
state> or any <component state> which assigns such task or function shall provide or
procure the provision of resources to enable the Property Board to perform the task or
function.
Article 8 Period of operation of the Property Board
1. Ten years after entry into force of the Foundation Agreement, the Property Board shall be
wound up. If the Property Board by that date has not completed determination of all claims
or any other task before it, the Supreme Court may extend the period of operation of the
Property Board for one year at a time. In case of such an extension, the Supreme Court may
order retention by the Property Board of specified assets to enable it to continue its work in
accordance with these provisions.
2. The Property Board may decide, by majority of five to two and subject to the approval of
the [executive heads] of the <component states> acting by consensus, to wind itself up on a
date earlier than ten years after commencement of its operations, provided that its work has
been completed or appropriate provision has been made for transfer to a competent body of
any outstanding functions or matters.
3. The Supreme Court may, upon application by the Property Board or by the [executive
heads] of the <component states> acting by consensus, extend the period of operation of a
specific section or sections of the Property Board for one year at a time, in order to enable
completion of a specified function, and may order retention by that section or sections of
specified assets to enable the continuation of work. Notwithstanding any such limited
extension of operation of a particular section or sections, the Property Board shall be
considered to be wound up for the purposes of these provisions, unless the Supreme Court
orders otherwise.
4. For the purposes of hearing and determining disputes over claims, entitlements of
dispossessed owners, current users or owners of improvements, property valuation, right of
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first refusal, or title to or other rights in respect of property, the relevant section of the
Property Board shall continue in operation for as long as the Supreme Court deems fit.
5. Prior to its winding-up, the Property Board shall make arrangements for the completion of
any tasks or functions assigned to it under these provisions, including any claims or disputes
which are pending or which may arise in future. For this purpose, it may refer or request the
Supreme Court to assign specified claims or cases to other competent bodies or courts or to
a section of the Property Board, which will continue in operation by order of the Supreme
Court. The obligation to ensure or make arrangements for completion of any tasks or
functions under these provisions shall also apply to any section of the Property Board which
continues in operation for any extended period.
6. At the time of winding-up of the Property Board and each of its sections, each
<component state> shall purchase any property or assets located within that <component
state> which are still held by the Property Board, and which are no longer required for the
purpose of carrying out its functions or the functions of any section which continues to
operate for an extended period under this Article. Purchase shall be at a price equal to
current value at the time of sale and the proceeds shall be deposited in the Compensation
Fund.
Section B: Handling of property transferred to or via the Property Board
Article 9 Handling of property transferred to or via the Property Board
1. The Property Board shall receive transfer of title to affected property which is:
a. Not claimed by a dispossessed owner within the time period set by these provisions for
submission of claims;
b. Owned by a dispossessed owner who receives compensation from the Property Board or
title to another property in exchange for his/her title; or
c. Owned by a dispossessed owner who disposed of his/her interest in an affected property
of which s/he was the current user, in exchange for transfer of title to such affected property
to the subsequent purchaser (or his her successors in title) in accordance with Article 12.
2. In disposing of property transferred to it under these provisions, the Property Board shall,
in this sequence:
a. Offer the property for sale to the current user at current value;
b. Offer the property for sale to persons hailing from the <component state> in which the
property is located, at current value, including potentially in exchange for compensation
bonds;
c. Use it as alternative accommodation; or
d. Otherwise dispose of it in a prudent manner, at market value, to generate funds for
compensation purposes.
3. In all cases and at all times, the Property Board shall supervise management of property
transferred to it or otherwise under its control in a prudent manner and in accordance with
these provisions.
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4. All funds generated from the sale or use of affected property held by the Property Board
shall be deposited into the Compensation Fund.
Section C: Decision-making and claims for affected property
Article 10 Decision-making
1. The Property Board shall aim to reach all decisions by consensus. If the members are
unable to reach consensus on a decision, the decision shall be taken by majority vote.
2. The Property Board shall consider any relevant material or evidence put before it in
respect of any claim for affected property or any other matter which is within its jurisdiction
or decision-making power.
Article 11 Claims procedure
1. A dispossessed owner shall be entitled to file a claim with the Property Board for
recognition of his/her interest in or title to affected property. In filing a claim for recognition
of an interest or title, a claimant shall also specify how s/he seeks to exercise his/her
property rights, namely by way of:
a. Compensation;
b. Reinstatement; or
c. Sale, exchange or lease.
2. A current user of an affected property who is also a dispossessed owner, or a person who
owns a significant improvement to an affected property may apply to receive title to such
properties.
3. Claims or applications for transfer of title must be filed within a period of one year,
commencing on a date to be determined by the Property Board which shall be no later than
one year after entry into force of the Foundation Agreement. The decision fixing the relevant
date shall be published in the Official Gazettes of the <common state> and the <component
states>, in the most widely circulated newspaper of each <component state> and in any other
such appropriate manner as determined by the Property Board.
4. A claim or application shall be filed together with certified copies of any available
evidence of the claimant's or applicant's interest in or title to the affected property.
5. Holders of a part interest in or title to an affected property shall, wherever possible, file
joint claims.
6. A dispossessed owner who does not file a claim within the stipulated period and can show
good cause why s/he did not or was not able to do so, is entitled to compensation.
7. Further detailed requirements for the filing and determination of claims and applications
in respect of affected property shall be set out in rules, regulations, procedures, forms,
evidence and any other instruments adopted by the Property Board in accordance with these
provisions.
Article 12 Determination of claims and applications
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1. Upon receipt of any claim for affected property, the Property Board shall, following any
necessary investigation and verification, determine whether the claimant has a lawful
interest in the property.
2. Upon receipt of any application with respect to affected property, the Property Board
shall, following any necessary investigation and verification, determine whether the
applicant has a sufficient interest in the property under these provisions.
3. If the Property Board determines that the claimant or applicant is not the sole
dispossessed owner or person with an interest in the affected property, it shall make
reasonable efforts to contact the other interested parties, including the current user, before
deciding the claim or application.
4. The Property Board shall then determine whether the claimant or applicant is entitled to
exercise his/her rights in the manner requested in the claim or otherwise under these
provisions.
5. In its decision, the Property Board shall, if possible, state the name and interest of any
other holder of a lawful interest in the property. Where it has been unable to locate or
contact such persons before deciding the claim or application, it shall publish its decision in
an appropriate manner.
6. In its decision, the Property Board shall also indicate the steps necessary for the execution
or implementation of the decision and, where appropriate, shall order that they be taken
within specified time frames.
7. If the Property Board decides that a claimant or applicant has no legal interest in the
claimed affected property, it shall reject the claim or application. At the same time, it may
decide on the interests of the other parties to the proceedings and issue orders with respect to
the property as appropriate.
Article 13 Decisions on reinstatement
1. Upon determination that a property is eligible to be reinstated, the Property Board shall
inform the claimant of its decision. It shall hold the case as pending until all claims for
reinstatement have been reviewed, in order to determine the priority for reinstatement in
accordance with Article 15 of Annex VII.
2. The Property Board shall endeavour to determine the eligibility of all claims for
reinstatement before issuing final decisions on reinstatement. If the determination of
eligibility in some cases is delayed, because of exceptional circumstances, the Property
Board may issue final decisions on reinstatement as soon as it has determined the eligibility
of at least 90% of the claims for reinstatement. Reinstatement shall only be granted in the
delayed cases if the agreed levels for reinstatement have not yet been reached, irrespective
of the priority that the claimant might otherwise have had.
3. The Property Board shall issue final decisions on reinstatement of properties that are not
subject to the agreed levels of reinstatement in Article 15 of Annex VII as soon as it has
determined their eligibility for reinstatement.
4. Upon issuing a final decision on reinstatement, the Property Board shall inform the
current user of the affected property of the decision, of his/her obligation to vacate the
affected property and of his/her rights to alternative accommodation; it may also inform the
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authorities of the relevant <component state> responsible for enforcement and
implementation of the decision.
5. Reinstatement shall only occur after the current user has been provided with alternative
accommodation or the final deadline for vacating the property as determined by the Property
Board in accordance with Attachment 3 has expired, whichever is the sooner.
Section D: Assistance with sale, exchange or lease
Article 14 Assistance with sale, exchange or lease
1. A dispossessed owner may request the Property Board for assistance in connection with:
a. Sale of an interest in affected property;
b. Exchange of affected property for another property of similar value in the <component
state> from where he/she hails;
c. Purchase of an interest in affected property; or
d. The leasing of affected property.
2. A current user or other person may request the Property Board for assistance in
connection with the purchase, exchange or acquisition of a leasehold interest in a property,
which, if available, could enable him/her to vacate the affected property.
3. The Property Board shall maintain a register of interested dispossessed owners, current
users and others who wish to engage in sale, exchange or lease transactions and keep a
record of such transactions.
4. Upon the request of a dispossessed owner, current user, or other person wishing to engage
in a sale, exchange or lease transaction, the Property Board may:
a. Offer basic advice and assistance on options and implications of sale, exchange or lease
transactions;
b. Provide services through mediation to facilitate sale, exchange or lease transactions
between interested parties, on an anonymous or open disclosure basis, as preferred by the
parties; or
c. Provide information about potential sale, exchange or lease counterparts from its sale,
exchange and lease register, to other bona fide interested parties, in cases where the relevant
person has given consent to disclosure of such information.
Article 15 Standard form lease
The Property Board shall provide on request a standard form of lease agreement.
Article 16 Sale, exchange and lease: other assistance
1. The Property Board shall refer any interested party on request to a list of real estate agents
of a high professional standard, who are acting in one or both <component states> and who
can assist persons seeking advice regarding sale, exchange or lease transactions in one or
both <component states>.
2. Subject to these provisions, the Property Board's involvement in a sale, exchange or lease
transaction shall be limited to conveying information between the counterparts to the
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potential transaction. The Property Board shall not be responsible for negotiation or
completion of contractual arrangements, nor any resulting dispute or loss.
Section E: Compensation fund and bonds
Article 17 Compensation Fund
A Compensation Fund shall be established in the Central Bank of Cyprus and administered
by the Property Board. The <common state> shall provide the initial capital of X [insert
figure] to the Fund. In addition, the Fund shall receive all proceeds from the use or disposal
of property that has been transferred to the Property Board and contributions from
international donors.
Article 18 Use of compensation bonds
1. The Property Board shall issue bonds drawn on the Compensation Fund, known as
'compensation bonds'.
2. Compensation bonds shall bear interest of X % [insert figure] per year .
3. Compensation bonds may be used by holders for the following purposes:
a. To purchase affected property from the holdings of the Property Board at current value; or
b. To procure the payment by the Property Board of a deposit for purchase of alternative
accommodation on the open market; or
c. For sale to any person, who thereby acquires all entitlements of the initial holder.
4. Compensation bonds and interest thereon shall be guaranteed by the <common state>.
5. X years [insert figure] after entry into force of the Foundation Agreement, compensation
bonds shall be redeemable for cash from the Compensation Fund. Thereafter, the
Compensation Fund shall be wound up and the <common state> shall receive any surplus
remaining in the Fund or cover its deficit, as applicable. Proceeds of any subsequent sale of
affected property from the holdings of the Property Board shall go directly to the <common
state>, which shall be obliged to pay any compensation which may be awarded by the
Property Board after the winding-up of the Compensation Fund.
ATTACHMENT 3: MEASURES IN FAVOUR OF CURRENT USERS
Section A: Extension of deadlines for vacating affected property
Article 1 Property occupied by current users with sufficient financial means
1. A current user of a property designated for reinstatement, with sufficient financial means,
may apply to the Property Board for an extension to enable him/her to continue to use the
property for his/her own purposes for up to three years after the Property Board's decision.
2. An application for an extension shall be granted by the Property Board unless and up to
the time when it is found that the current user is not using the property for his/her own
purposes, or that the current user has immediate access to alternative accommodation.
3. The Property Board may extend the time limit under this Article in cases of urgent
humanitarian need, as determined by the Property Board.
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4. The current user shall pay market rent to the Property Board for the period of continued
use of the affected property from the date of the Property Board's decision on eligibility for
reinstatement.
5. At the end of the period fixed by the Property Board, the current user shall vacate the
affected property.
Article 2 Property occupied by current users without sufficient financial means
1. A current user of a property designated for reinstatement, without sufficient financial
means, who is a Cypriot citizen and is using the property for his/her own purposes, shall not
be required to vacate the property until alternative accommodation is made available for
them or until they are able, including through the provision of preferential loans or other
assistance, to buy or lease on the market a property which meets the standard of alternative
accommodation.
2. Such current users may apply to the Property Board for:
a. Assistance to purchase or lease alternative accommodation, in the form of preferential
loans under these provisions; or
b. In cases of urgent humanitarian need and where not eligible for preferential loans, the
allocation of low-cost or cost-free alternative accommodation from the holdings of the
Property Board. The Property Board shall grant such applications to persons meeting its
criteria, provided that alternative accommodation is available in its holdings.
3. Current users of properties designated for reinstatement, without sufficient financial
means, who are not citizens of Cyprus but enjoy permanent residence and are using the
property for his/her own purposes, may apply for social housing or other housing assistance,
or for financial assistance from the <component state> of which they enjoy permanent
residence. Such current users shall not be required to vacate the property until such housing
or financial assistance is available, up to a maximum of two years after the Property Board's
decision on eligibility for reinstatement.
4. The Property Board shall charge rent to any current user without sufficient financial
means, up to the maximum amount possible based on his/her income and wealth.
Article 3 Payment of rent to dispossessed owner up to reinstatement
The Property Board shall pay market rent to the dispossessed owner, effective from the date
of the decision of the Property Board that the property is eligible for reinstatement up to the
date on which reinstatement occurs.
Section B: Preferential loans
Article 4 Preferential loans
1. The Property Board shall oversee and administer a preferential loans scheme with the
assistance of international and local banks, the <common state>, the <component states>
and other donors. The <common state> shall provide funds from its budget to support the
scheme.
2. Under this scheme, preferential loans shall be made available on favourable terms for
dispossessed owners, current users of affected property and owners of significant
improvements to affected property who are Cypriot citizens and who are without sufficient
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financial means, in order to facilitate the purchase, lease or reconstruction of property
(including the purchase of significantly improved property) or make payments required
under these provisions.
3. Loans under this scheme will be made available to people who meet the criteria on
condition that they agree to a 20 year moratorium on sale of any property which they
purchased or reconstructed or for which they received title after making a payment to the
Property Board with preferential loan funds. This moratorium period may be shortened or
waived with the authorization of the Property Board.
Section C: Right of first refusal
Article 5 Right of first refusal for current user and others in sales of affected property
1. For a transitional period of 20 years after entry into force of the Foundation Agreement,
any sale of an affected property to a person who has not enjoyed permanent residence for at
least three years in the <component state> in which such property is located, is subject to a
right of first refusal by a current user, who is a Cypriot citizen, at the proposed contract
price. Such right shall apply:
a. For as long as the current user continues to use such property, and
b. For five years thereafter, if the current user has vacated it to allow reinstatement of the
dispossessed owner.
2. If the current user does not exercise the right of first refusal under the previous paragraph,
any other person hailing from the <component state> in which the relevant property is
located shall have a secondary right of first refusal, at the contract price.
3. Rights of first refusal under this Article may be exercised within 45 days after the
dispossessed owner signs a sales contract with a potential purchaser, and at the same price as
stated in any such contract.
4. Any dispute regarding rights of first refusal shall be referred to the Property Board. The
<component states> shall enact harmonized legislation as required to regulate and ensure
enforcement of contracts concluded under these provisions for rights of first refusal, and
otherwise between current users and persons hailing from different <component states>.
ATTACHMENT 4: PROPERTY LOCATED IN AREAS SUBJECT TO
TERRITORIAL ADJUSTEMENT
Article 1 Application of these provisions to property in areas subject to territorial
adjustment
The Articles in this Attachment shall prevail over the other provisions of Annex VII and its
other attachments in relation to affected property and other property in areas subject to
territorial adjustment. Where there are no specific provisions in this Attachment, the other
provisions of Annex VII and its other attachments shall apply.
Article 2 Reinstatement of dispossessed owners
1. Subject to the modalities and conditions established in this Attachment, any dispossessed
owner of a property in areas subject to territorial adjustment shall be entitled to
reinstatement.
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2. The Property Board shall issue final decisions on reinstatement of properties located in
areas subject to territorial adjustment, as soon as it has determined that property is eligible
for reinstatement and shall order that such reinstatement take place as soon as the current
user has been relocated, but no later than three years after entry into force of the Foundation
Agreement.
3. The general moratorium and agreed maximum levels on reinstatement under Annex VII
shall not apply to areas subject to territorial adjustment nor shall provisions permitting
transfer of properties to a current user or a subsequent purchaser.
4. The Property Board shall deal with claims regarding affected property of dispossessed
owners currently living in areas subject to territorial adjustment, the claims of the current
owners of those properties and the claims of dispossessed owners of affected properties in
areas subject to territorial adjustment, in that order of priority.
Article 3 Improved properties
1. The dispossessed owner of any improved property shall pay the market value of any
improvement worth more than 10% of the value of the property in its original state to
Property Board. The owner of the improvement is entitled to seek compensation from the
Property Board for its market value.
2. If the dispossessed owner satisfies the Property Board that an improvement worth less
than the value of the property in its original state is inappropriate for his/her intended use of
the property which is similar to the use prior to dispossession, the dispossessed owner shall
not be required to pay for the improvement. The Property Board may recover any
compensation paid to the improver if it subsequently finds that the dispossessed owner
makes use of the improvement.
3. Where the market value of the improvement is greater than the value of the property in its
original state and the dispossessed owner is not prepared to pay for it, the owner of the
improvement may apply to receive title to the property in exchange for payment of the
current value of the property in its original state. The dispossessed owner shall retain a right
of first refusal for a period of 20 years after entry into force of the Foundation Agreement,
for any contract for sale, exchange or long-term lease of the property, at the proposed
contract price.
Article 4 Owners of property in areas subject to territorial adjustment who wish to
leave
An owner of property in an area subject to territorial adjustment who vacates such property
after entry into force of the Foundation Agreement may claim compensation from the
Property Board for such property at current value in exchange for his/her title to such
property, provided s/he can produce evidence of ownership before 1974 or of bona fide
transfer from the 1974 owner.
Article 5 Current users of property in areas subject to territorial adjustment
1. A current user of property in an area subject to territorial adjustment who is a Cypriot
citizen may choose to:
a. Remain in that area and purchase property there;
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b. Receive alternative accommodation in that area, if entitled under these provisions (see
Attachment 3);
c. Claim reinstatement of his/her own affected property; or
d. Be relocated in the other <component state> and purchase property or receive alternative
accommodation there, if entitled under these provisions (see Annex VI).
A current user who is not a Cypriot citizen may seek housing or financial assistance from the
<component state> in which s/he enjoys permanent residence or apply for assistance
according to Annex VI.
DRAFT ANNEX VIII: RECONCILIATION COMMISSION
Article 1 Establishment
1. There shall be an independent, impartial Reconciliation Commission.
2. The authorities of the <common state> and the <component states> shall render the
Commission full cooperation and shall issue instructions to that effect to all concerned.
Article 2 Aims
With the objective of promoting understanding, tolerance and mutual respect between Greek
Cypriots and Turkish Cypriots, the Reconciliation Commission shall, inter alia:
a. Promote a dispassionate dialogue between Greek Cypriots and Turkish Cypriots regarding
the past, by addressing, inter alia, historical perspectives, experiences, and memories;
b. Prepare a comprehensive report on the history of the Cyprus Problem as experienced and
interpreted by Greek Cypriots and Turkish Cypriots;
c. Make specific recommendations for action by the <common state> and the <component
states> aimed at promoting reconciliation, including guidelines for publications and school
textbooks so as to promote mutual understanding of different perspectives on the past;
d. Make recommendations for the implementation of the requirement in the Constitution for
the teaching of the official languages to all secondary school students; and
e. Make recommendations on guidelines for the observance of secular public holidays by the
<component states>.
Article 3 Powers
1. In furtherance of these aims the Reconciliation Commission may, among other things:
a. Convene public or private hearings and set up research groups or committees to discuss
and/or inquire into questions, facts, events and time periods related to its work;
b. Receive information from varied sources, from parties, governments or individuals inside
or outside Cyprus;
c. Consult experts in relevant fields;
d. Request and receive prompt, full and unhindered access to any and all records, archives or
information;
e. Prepare and publish interim reports, findings and recommendations;
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f. Adopt and publish rules, regulations and procedures required for the performance of its
functions; and
g. Perform other tasks which may be incidental or related to the performance of its
functions.
2. The Commission shall have no prosecutorial or other criminal legal function or powers.
3. The Commission may decide to protect the confidentiality of its sources and proceedings.
4. The work, proceedings, reports and recommendations of the Commission shall be without
prejudice to the work of other existing bodies or committees, including the Committee on
Missing Persons in Cyprus.
Article 4 Composition
1. The Reconciliation Commission shall be composed of [five/seven/nine] men and women,
including at least one non-Cypriot member, committed to reconciliation in Cyprus and
possessing appropriate integrity, credibility and expertise. The Cypriot members shall hail in
equal numbers from each <component state>.
2. The Secretary-General is invited to appoint the members of the Commission, after
consultation with the two sides and the public, and to appoint any replacements in the same
way.
3. The Commission shall be assisted by a group of qualified staff.
Article 5 Duration
1. The process of consultation for appointment of the members of the Reconciliation
Commission shall commence no later than 60 days after entry into force of the Foundation
Agreement. The Commission members shall be appointed within a further 60 days and be
inaugurated within a further two weeks.
2. Unless the Secretary-General, in consultation with the two sides and the members of the
Commission, decides to grant an extension of up to six months, the Commission shall
submit its final report on its conclusions and recommendations no later than 30 October
2005.
Article 6 Costs
The costs of establishing and running the Reconciliation Commission shall be met by the
<common state>, which may request contributions from the guarantor powers and other
international donors.
Article 7 Recommendations and reports
1. The Reconciliation Commission shall submit its reports and recommendations to the
Secretary-General of the United Nations, the <common state> and the <component states>.
2. The final report and all recommendations by the Reconciliation Commission shall be
given wide dissemination by the <component states>. The final report shall be published in
English, Greek and Turkish. The findings of the final report shall be reflected in relevant
school textbooks
Article 8 Follow-Up Procedures
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1. After the submission of the Commission’s final report, a follow-up committee, appointed
[insert method of appointment], shall monitor the implementation of the Commission’s
recommendations.
2. The authorities of the <common state> and each <component state> shall be required to
submit reports every 120 days to the committee on the implementation of recommendations.
Such reports shall explain the reasons for failure to implement specific recommendations.
[insert additional articles as necessary; including, inter alia, on procedures for public
consultation regarding appointment of members; immunities; the giving of evidence;
remuneration of Commission members, etc]
DRAFT ANNEX IX: COMING INTO BEING OF THE NEW STATE OF AFFAIRS
Article 1 Conduct of separate simultaneous referenda
1. Each side shall organise a referendum on 30 March, asking the following question:
''Do you:
i) Approve the Foundation Agreement and all its Annexes, including the Constitution of
Cyprus;
ii) Approve the Constitution of the [Greek Cypriot/Turkish Cypriot] <component state> and
the provision as to the laws to be in force for the <component state>
iii) Approve the terms of the draft Treaty between Cyprus, Greece, Turkey and the United
Kingdom on matters related to the new state of affairs in Cyprus, and require the signature
by the Co-Presidents of the Treaty;
iv) Approve the accession of Cyprus to the European Union in accordance with the
conditions of accession laid down in the draft Treaty concerning accession of Cyprus to the
European Union, and require the signature and ratification by the Co-Presidents of the
Treaty?
Yes [ ]
No [ ]''
2. The documents to be approved or being referred to in the referendum question shall be
made available free of charge to any voter so requesting in Greek, Turkish or English and
shall be placed on a common website in the same languages.
Article 2 Entry into force of the Foundation Agreement
At 00:00 hours the day after confirmation by the Secretary-General of its approval at
separate simultaneous referenda, the Foundation Agreement shall immediately enter into
force, thereby bringing into being a new state of affairs.
Article 3 Flag-raising ceremonies
Upon entry into force of the Foundation Agreement, there shall be ceremonies throughout
the island at which all flags other than those prescribed in the Constitution shall be lowered,
the flags of Cyprus and of the <component states> shall be raised in accordance with the
Constitution of Cyprus and relevant legislation, and the anthems of Cyprus and of the
<component states> shall be played.
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Article 4 The United Nations
Upon entry into force of the Foundation Agreement, the Co-Presidents shall inform the
United Nations that henceforth the membership rights and obligations of Cyprus in the
United Nations shall be exercised in accordance with the new state of affairs. The agreed
flag of Cyprus shall be raised at United Nations Headquarters.
DRAFT ANNEX X: CALENDAR OF IMPLEMENTATION
[insert calendar of implementation of obligations in the Foundation Agreement, as well as in
other parts of the Comprehensive Settlement.]
APPENDIX B
MEASURES TO ACCOMPANY AND FACILITATE THE FINALIZATION
PROCESS
During the period between the signature of the Comprehensive Settlement and the separate
simultaneous referenda to approve the Foundation Agreement, the following provisions shall
be applied:
Article 1 Finalization of Foundation Agreement
1. The two leaders shall make the finalization of the Foundation Agreement by no later than
28 February 2003 their primary aim and the primary aim of their authorities.
2. The two leaders shall restrict their activities, and the activities of their authorities, to
business strictly indispensable for the functioning of their authorities. All actions shall take
into account the letter and spirit of the draft Foundation Agreement.
3. Any indispensable business in the field of foreign relations shall be conducted in close
consultation between the two leaders and shall promote the common interests of the two
sides. There shall be no state visits.
Article 2 Committees to finalize Foundation Agreement
Upon signature of the Comprehensive Settlement, the two leaders shall appoint persons to
participate in bilateral committees, which shall be chaired by United Nations representatives
and shall make recommendations by consensus, prior to the end of the finalization period, on
the finalization of the Annexes to the Foundation Agreement.
Article 3 Flag and anthem competition
A competition shall be conducted to conceive a flag and anthem for Cyprus, and a bilateral
committee, chaired by the United Nations, shall make recommendations by consensus to the
two leaders from among entries received.
Article 4 <component state> constitutions and legislation
1. Each side shall, without delay, make necessary preparations on <component state>
matters to be put to referendum together with the Foundation Agreement. To this end,
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a. Each side shall prepare a draft <component state> constitution consistent with the draft
Constitution of Cyprus.
b. Each side shall prepare a provision specifying those laws that shall become laws of the
respective <component state>, provided that such laws do not fall within the agreed sphere
of competence of the <common state> and are also otherwise compatible with the
Foundation Agreement.
c. Each side shall include the following provision in the draft <component state>
constitution:
i) ''<component state> laws adopted pursuant to a provision put to referendum together with
the Foundation Agreement and this Constitution shall, as from entry into force of the
Foundation Agreement, be applied in this <component state> with such modifications as
may be necessary to bring them into conformity with the Foundation Agreement and the
Constitution of this <component state>.
ii) No provision in any such law which is contrary to or inconsistent with any provision of
the Foundation Agreement or this Constitution shall so continue to be in force.
iii) The term ''modification'' in the above paragraphs includes amendment, adaptation and
repeal.''
Article 5 Measures to promote confidence
Steps shall be taken without delay to lift restrictions on trade, movement of tourists, and
participation in international sporting and cultural activities.
Article 6 Freedom of movement of UNFICYP
Any restrictions on the freedom of movement of UNFICYP shall be terminated with
immediate effect.
Article 7 Selection of Board of Central Bank
1. The two leaders shall by consensus select the three members of the transitional Board of
the Central Bank who shall assume their duties immediately upon entry into force of the
Foundation Agreement of a period of 15 calendar months.
2. If the two leaders fail to do so by 31 January 2003, the Secretary-General of the United
Nations is invited to select the members of a transitional Board.
Article 8 Transitional Supreme Court judges
1. The two leaders shall by consensus select, from a list of candidates presented by the
presumed members of the transitional Judiciary Board, three non-Cypriot judges and three
judges from each side to sit on the transitional Supreme Court of Cyprus who shall assume
their duties immediately upon entry into force of the Foundation Agreement for a period of
15 calendar months.
2. The presumed members of the transitional Judiciary Board in accordance with the
provisions of the draft law shall within 30 days of signature of the Comprehensive
Settlement meet upon the invitation of the United Nations in order to propose candidates for
the transitional Supreme Court.
197
3. If the two leaders fail to do so by 31 January 2003, the Secretary-General of the United
Nations is invited to select the judges of the transitional Supreme Court.
Article 9 Import and distribution licenses
The two sides shall conclude arrangements, without prejudice to the application of European
Union law, for the purpose of ensuring that the Foundation Agreement and the new state of
affairs shall not be construed as altering rights enjoyed by businesspeople under import
and/or distribution licenses prior to entry into force of the Agreement, and that such licenses
shall where possible be construed as licensing such persons to continue operating their
businesses in their <component state> after entry into force of the Foundation Agreement.
Article 10 Economic harmonization
The two sides shall conclude arrangements to promote economic harmonization.
Article 11 Missing persons
The two leaders shall without delay take steps to conclusively resolve the issue of missing
persons. Both sides shall cooperate fully with the Committee on Missing Persons in Cyprus,
in accordance with its terms of reference and keeping in mind their agreement reached on 31
July 1997. Each side shall carry out and conclude any and all necessary inquiries, including
exhumations.
APPENDIX C
TREATY BETWEEN CYPRUS, GREECE, TURKEY AND THE UNITED
KINGDOM ON MATTERS RELATED TO THE NEW STATE OF AFFAIRS IN
CYPRUS
Cyprus, the Hellenic Republic, the Republic of Turkey and the United Kingdom of Great
Britain and Northern Ireland,
i. Welcoming the Comprehensive Settlement of the Cyprus Problem and the approval of the
Foundation Agreement through separate referenda by the Greek Cypriots and the Turkish
Cypriots, and the decision for Cyprus to accede to the European Union and
ii. Desiring to contribute to a peaceful and harmonious future for Cyprus and for Cyprus to
be a bridge of friendship between Greece and Turkey within a peaceful environment in the
Eastern Mediterranean
Adopt the following provisions:
Article 1 Approval of Foundation Agreement
The annexed Foundation Agreement is herewith approved and agreed and shall be
considered an integral part of this Treaty.
Article 2 Monitoring Committee
1. The parties agree on the creation of a Monitoring Committee composed of one
representative of each guarantor power, two representatives of the <common state>
government (one hailing from each <component state>), one representative of each
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<component state> and, pursuant to a decision of the United Nations Security Council, one
representative of the United Nations who shall chair the committee.
2. The Monitoring Committee shall monitor the implementation of the Foundation
Agreement, and may make recommendations regarding any development which may
endanger its implementation.
Article 3 Additional Protocol to the Treaty of Guarantee
The annexed Additional Protocol to the Treaty of Guarantee is herewith approved and
agreed, and shall enter into force together with this Treaty.
Article 4 Additional Protocol to the Treaty of Alliance
The annexed Additional Protocol to the Treaty of Alliance is herewith approved and agreed
by the parties concerned, and shall enter into force for them upon signature together with
this Treaty.
Article 5 Transitional Security Arrangements
The annexed Transitional Security Arrangements are herewith approved and agreed by the
parties concerned, and shall enter into force for them upon signature together with this
Treaty.
Article 6 Entry into force
1. This treaty shall enter into force upon signature.
2. The parties shall proceed as soon as possible to the registration of this Treaty with the
Secretariat of the United Nations, in accordance with Article 102 of the Charter of the
United Nations.
DRAFT ANNEX I: FOUNDATION AGREEMENT
[insert text of Foundation Agreement as approved in separate simultaneous referenda]
DRAFT ANNEX II: ADDITIONAL PROTOCOL TO THE TREATY OF
GUARANTEE
Cyprus, Greece, Turkey and the United Kingdom of Great Britain and Northern Ireland have
agreed as follows:
Article 1
1. The Treaty of Guarantee shall apply mutatis mutandis to the new state of affairs
established in the Foundation Agreement and the Constitution of Cyprus, thereby covering,
in addition to the independence, territorial integrity, security and constitutional order of
Cyprus, the territorial integrity, security and constitutional order of its <component states>.
2. ''Constitutional order'' shall mean the Constitution of Cyprus, as the case may be, the
Constitution of each <component state>, including any amendments to any of them in
accordance with the provisions for amendment laid down in the relevant constitution.
Article 2
This Protocol shall enter into force upon signature.
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Signature Signature Signature Signature
Cyprus Hellenic Republic Republic of Turkey United Kingdom of Great Britain
and Northern Ireland
DRAFT ANNEX III: ADDITIONAL PROTOCOL TO THE TREATY OF
ALLIANCE
Cyprus, Greece and Turkey
i. Bearing in mind that in accordance with the Foundation Agreement and its Constitution,
Cyprus shall be demilitarized
ii. Reaffirming their pledge to resist any attack or aggression against the independence or the
territorial integrity of Cyprus
Have agreed as follows
Article 1
The Treaty of Alliance shall apply and operate mutatis mutandis in accordance with the new
state of affairs established in the Foundation Agreement and the Constitution of Cyprus,
taking into account in particular the demilitarization of Cyprus.
Article 2
There shall be no Tripartite Headquarters. The provisions of the Treaty of Alliance shall
apply mutatis mutandis to the commanders of the Greek and Turkish contingents, who shall
consult and cooperate in the performance of their functions pursuant to the Treaty.
Article 3
The Greek and Turkish contingents, each not exceeding [insert figure between 2,500 and
7,500 prior to the signature of the Comprehensive Settlement] all ranks, shall be permitted to
be stationed under the Treaty of Alliance in the Greek Cypriot <component state> and the
Turkish Cypriot <component state> respectively. The composition, equipment, locations and
activities of the Greek and Turkish contingents shall be as specified in the Attachment to this
Additional Protocol.
Article 4
This Protocol shall enter into force upon signature and shall have precedence over other
provisions of the Treaty of Alliance.
Signature Signature Signature
Cyprus Hellenic Republic Republic of Turkey
Attachment: Composition, equipment, locations and activities of Greek and Turkish
contingents
ATTACHMENT 1: COMPOSITION, EQUIPMENT, LOCATIONS AND
ACTIVITIES OF GREEK AND TURKISH CONTINGENTS
Article 1 Composition
The composition of each contingent for all services shall be equivalent in terms of structure
and strength and shall consist of a headquarters, formed units and individuals. The
200
composition of the contingents shall include the following types of units up to the maximum
indicated strength:
Type of Unit Maximum Strength
Armoured Battalion
Infantry Battalion
Engineer Company
Artillery Battalion
Signal Company
Aviation Battalion (Helicopter)
Air Defence Battery
Support Unit
Medical Unit
Brigade HQ
[…]
[…]
Article 2 Weapons and equipment
The contingents shall have equivalent weapons and equipment commensurate with the type
and number of units. Their weapons and equipment shall include the following, up to the
maximum indicated number, with limitations notably concerning armoured vehicles, heavy
weapons and artillery systems and offensive weapons such as attack helicopters:
Type of Weapon/Equipment Maximum Number
Battle tanks (medium)
Infantry fighting vehicles including APCs
(main gun up to 25 mm)
Towed artillery pieces (up to 155 mm calibre)
Air defence missiles (short range up to
7000m)
[…]
[…]
Article 3 Activities
The contingents shall be restricted to typical peacetime activities for formed military units,
mainly encompassing training within the compounds and military quarters, maintenance of
equipment and material, ceremonies and parades and training in designated training fields.
Article 4. Location of facilities and training fields
The agreed designated military facilities and training fields shall in any case not be in areas
which prior to entry into force of the Foundation Agreemen were within the buffer zone, or
in areas of the Greek Cypriot <component state> which are or have been subject to territorial
201
adjustment pursuant to the Foundationa Agreement, or in the area of the Turkish Cypriot
<component state> south of the highway connecting north Nicosia with Famagusta.
Article 5 Facilities
The designated military facilities in which troops and equipment shall be based are the
following:
Contingent Location[27]
(with grid reference)
Number of
Troops
Greek
Turkish
Article 6 Training fields
The designated training fields for each contingent are the following:
Contingent Location[28]
(with grid reference to 4 digits)
Greek
Turkish
Article 7 Movement
The contingents shall move troops in the <component state> in which they are located by the
most direct route between points of embarkation, garrisons and training areas and shall not
approach the boundary between the <component states>, or areas which prior to entry into
force of the Foundation Agreement were within the buffer zone, or the areas of the Greek
Cypriot <component state> which are or have been subject to territorial adjustment pursuant
to the Foundation Agreement, or in the area of the Turkish Cypriot <component state> south
of the highway connecting north Nicosia and Famagusta, unless the existing road
infrastructure necessitates otherwise.
Article 8 Notice
The contingents shall inform each other and the United Nations in writing 14 days in
advance of the timing, location and purpose of any ground, air or maritime movement of
troops, including for field training. A movement of troops shall be defined as more than
three military transport vehicles with a capacity of three passengers or more in each vehicle.
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[insert additional articles as necessary]
DRAFT ANNEX IV: TRANSITIONAL SECURITY ARRANGEMENTS
Article 1 Dissolution of Greek Cypriot and Turkish Cypriot forces, including reserve
units
All Greek Cypriot and Turkish Cypriot forces, including reserve units, shall be dissolved,
and their arms removed from the island, in accordance with a timetable which shall
commence no later than five months following the signature of the Treaty on matters related
to the new state of affairs in Cyprus [''T-day''] and shall be carried out as follows:
a. [From T-day + 150 to T-day + 270: 20 per cent; (4 months)]
b. [From T-day + 271 to T-day + 450: 25 per cent; (6 months)]
c. [From T-day + 451 to T-day + 630: 25 per cent; (6 months)]
d. [From T-day + 631 to T-day + 870: 30 per cent; (8 months)]
Article 2 Adjustment of Greek and Turkish forces
Greek and Turkish forces and armaments shall be redeployed to agreed locations and
adjusted to agreed levels, and any excess forces and armaments withdrawn, in accordance
with a timetable which shall commence no later than five months following T-day and shall
be carried out as follows:
a. [From T-day + 150 to T-day + 270: 20 per cent; (4 months)]
b. [From T-day + 271 to T-day + 450: 25 per cent; (6 months)]
c. [From T-day + 451 to T-day + 630: 25 per cent; (6 months)]
d. [From T-day + 631 to T-day + 870: 30 per cent; (8 months)]
Article 3 Redeployment from areas subject to territorial adjustment prior to transfer
of administration
Notwithstanding the above, any forces and armaments shall be redeployed so as to vacate
areas subject to territorial adjustment prior to the dates agreed in the Foundation Agreeement
for the transfer of those areas.
APPENDIX D
MATTERS TO BE SUBMITTED TO THE UNITED NATIONS SECURITY
COUNCIL FOR DECISION
I.
Pursuant to the terms of the Comprehensive Settlement of the Cyprus Problem, the
Secretary-General of the United Nations shall, upon certification by him of the Foundation
Agreement and the finalized Annexes thereto, request the Security Council to take decisions
to enter into force simultaneously with the Foundation Agreement, in which the Security
Council would:
1. endorse the Foundation Agreement and, in particular;
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a. take formal note that any unilateral change to the state of affairs established by the
Foundation Agreement, in particular union of Cyprus in whole or in part with any other
country or any form of partition or secession, is prohibited; and
b. acknowledge the political equality and distinct identity of Greek Cypriots and Turkish
Cypriots and the equal status of their <component states> in the State of Cyprus; and
2. prohibit the supply of arms to Cyprus in a manner that is legally binding on both
importers and exporters;
3. decide to maintain a United Nations peacekeeping operation in Cyprus, which shall
remain so long as the government of the <common state>, with the concurrence of both
<component states>, does not decide otherwise, and shall be authorized to deploy and
operate freely throughout Cyprus with the following mandate
''to monitor the implementation of the Foundation Agreement and use its best efforts to
promote compliance with it and contribute to the maintenance of a secure environment; and
in particular:
a. to monitor and verify compliance with the security provisions in the Foundation
Agreement, including:
i) the dissolution of all Greek Cypriot and Turkish Cypriot forces, including reserve units,
and the removal of their arms from the island;
ii) the adjustment of Greek and Turkish forces and armaments to agreed equal levels;
b. to monitor and verify compliance with the provisions in the Foundation Agreement
pertaining to the police of the <common state> and <component states>;
c. to use its best efforts to ensure the fair and equal treatment under the law of persons from
one <component state> by the authorities of the other;
d. to supervise the activities relating to the transfer of areas subject to territorial adjustment;
e. to chair, and provide administrative support to, the Monitoring Committee to be
established under the Treaty between Cyprus, Greece, Turkey and the United Kingdom on
matters related to the new state of affairs in Cyprus;
f. to implement its mandate through, for example, conducting patrols and establishing
positions and roadblocks, as well as receiving complaints, making inquiries, presenting
facts, giving formal advice and making representations to the authorities."
II.
The authorities of the <common state> and of the <component states>, as well as the Greek
and Turkish contingents stationed on the island, shall cooperate with the United Nations
operation. The cost of the operation to the United Nations shall be borne by Cyprus.
APPENDIX E
REQUESTS TO THE EUROPEAN UNION WITH RESPECT TO THE ACCESSION
OF CYPRUS
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PROTOCOL REQUESTED TO BE ATTACHED TO THE ACT CONCERNING
THE CONDITIONS OF ACCESSION OF CYPRUS TO THE EUROPEAN UNION
i. Taking into account the Comprehensive Settlement of the Cyprus Problem between the
Greek Cypriot side and the Turkish Cypriot side of [insert date] and the terms of the
Foundation Agreement between the Greek Cypriots and the Turkish Cypriots of [insert date]
ii. Taking into account the Treaties of Guarantee and Alliance, the Additional Protocols
thereto, and the Treaty of Establishment
iii. Bearing in mind and respecting the demilitarization of Cyprus
iv. Considering that the Act concerning the conditions of accession of Cyprus to the
European Union shall not prevent the implementation of the Foundation Agreement, and
shall accommodate its terms in line with the principles on which the European Union is
founded
v. Bearing in mind that Cyprus shall take all appropriate measures, whether in general or
particular, to ensure the fulfillment of the obligations arising out of European Union
membership, in line with the specifications of the Act of accession and this Protocol, and
that transitional periods agreed during the accession negotiations shall apply to the
<common state> and to the two <component states>, subject to the division of powers as
laid down in the Foundation Agreement
vi. Underlining that the political equality of Greek Cypriots and Turkish Cypriots, the equal
status of the two <component states>, and the prohibition on any unilateral change to the
state of affairs established by the Foundation Agreement, fall within the terms of Article
6(1) of the Treaty of the European Union
vii. Recognizing the need to protect the balance between Greek Cypriots and Turkish
Cypriots in Cyprus, the bi-zonal character of the State of Cyprus and the identity of the
<component states>
viii. Underlining that accession to the European Union shall benefit Greek Cypriots and
Turkish Cypriots alike and promote development to help reduce economic disparities
ix. Recalling that, in accordance with the Presidency Conclusions of the Brussels European
Council of 24 and 25 October, a programme will be established by the Council, with
disbursement of 206 million euros between 2004 to 2006, in support of the economic
development of the northern part of a reunited Cyprus, and that this programme shall be
established in addition to the normal operation of the European Union's structural funds
x. Taking into account the special relations of Greek Cypriots and Turkish Cypriots with
Greece and Turkey respectively
xi. Bearing in mind that, as a European Union member state, Cyprus shall apply the rules of
the European Union-Customs Union with Turkey, thereby according European Union
treatment to Turkey in the fields where this is provided for
xii. Wishing to accord, to the extent compatible with the European Union membership of
Cyprus, similar rights for Greek and Turkish nationals vis-à-vis Cyprus
The High Contracting Parties have agreed as follows:
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Article 1 Arrangements relating to property and residency rights
The provisions of the Treaty shall not preclude the application of restrictions, on a non-
discriminatory basis, on:
a. The right of natural persons who have not been resident for at least three years in the
Turkish Cypriot <component state>, and for legal persons, to purchase real property in the
Turkish Cypriot <component state> without permission of the competent authorities of the
Turkish Cypriot <component state>
b. The right of Cypriot citizens to reside in a <component state> of which they do not hold
internal <component state> citizenship status, if
i) The number of such residents has reached 28% of the population of a <component state>;
or
ii) During a transitional period of 15 years, the number of such residents has reached a
certain percentage of the total population of a municipality or village; the relevant
percentage shall be 0% for the first 4 years after entry into force of the Foundation
Agreement,8% between the 5th
and 9th
years and 18% between the 10th
and 15th
years;
c. The right of Greek nationals to reside in Cyprus, if the number of resident Greek nationals
has reached 10 % of the number of resident Cypriot citizens who hold the internal
<component state> citizenship status of the Greek Cypriot <component state>
d. The right of Turkish nationals to reside in Cyprus, if the number of resident Turkish
nationals has reached 10% of the number of resident Cypriot citizens who hold the internal
<component state> citizenship status of the Turkish Cypriot <component state>.
Article 2 Safeguard measures
1. Where, in exceptional circumstances, the operation of the European Union's internal
market characterised by the abolition, as between Member States, of obstacles to the free
movement of goods, persons, services and capital, cause, or threaten to cause, serious
economic difficulties in the Turkish Cypriot <component state>, the competent Cypriot
authorities may take the appropriate safeguard measures for a period of three years. These
measures may be prolonged with the consent of the Commission. Such measures shall be
proportional and shall not constitute disguised restrictions on trade.
2. If measures taken in the circumstances referred to in paragraph 1 have the effect of
distorting the conditions of competition in the internal market, the Commission shall,
together with Cypriot representatives, examine how these measures can be adjusted.
3. By way of derogation from the procedure laid down in Articles 226 and 227 of the Treaty
establishing the European Community, the Commission or any Member State may bring the
matter before the European Court of Justice if it considers that Cyprus is making improper
use of the powers provided for in paragraph 1.
Article 3 Entry and residency rights of Turkish nationals
The European Union shall authorise Cyprus to accord equal treatment regarding entry and
residency rights with respect to its territory to Greek and Turkish nationals without prejudice
to policies and arrangements applying to entry and residency rights of Turkish nationals in
other member states of the European Union. Rules of implementation for such entry and
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residency rights for Turkish citizens shall be negotiated between the Commission, Cyprus
and Turkey within a year of entry into force of the Foundation Agreement.
Article 4 The European Security and Defence Policy
The participation of Cyprus in the European Security and Defence Policy shall fully respect
the provisions of the Foundation Agreement and the provisions of the Treaties of Guarantee
and Alliance and the Additional Protocols thereto, and in no sense undermine those
provisions.
PARAGRAPH REQUESTED TO BE INCLUDED IN THE CONCLUSIONS OF THE
COPENHAGEN EUROPEAN COUNCIL
The European Union undertakes to adopt special measures, including financial aid, to
contribute to the alignment of Turkish Cypriot legislation to the acquis communautaire, to
the enhancement of administrative capacity in the Turkish Cypriot <component state>, and
to the narrowing of economic disparities within Cyprus.
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ANNEX C.
THE EUROPEAN UNION’S POSITION TOWARDS
A SOLUTION TO THE CYPRUS PROBLEM
The Positions taken by the European Union
In June 1993, the European Commission (1993) makes it clear that it is only dealing with the
internationally recognized government of the Republic and finds Cyprus eligible for EU
membership …
… states that EU accession would increase the security and well being of all Cypriots and
points in particular to the economic benefits for the Turkish Cypriot administered sector in
the form of a participation in European Structural Funds as well as the Common Agricultural
Policy …
… states that its integration with the Community implies a lasting settlement to the Cyprus
Problem …
… states that while the fundamental interests of each community must be preserved by the
settlement, the institutional provisions of any settlement must assure the fundamental
freedoms enshrined in its constituting Treaty, in particular the freedom of movement of
goods, persons, services, and capital, the right of establishment and the universally
recognized political, social and economic rights …
… and gives its support to the UN Secretary General in his search for a solution to the
problem.
The Commission’s opinion is endorsed by the General Affairs Council in October 1993.
In June 1994, the European Observer Serge Abou shares the May 1993 opinion of the UN
Secretary General Boutros Boutros-Ghali that puts the blame for the lack of progress
towards a solution on the Turkish Cypriot side (see Agence Europe, nº. 6251, 15th
June,
1994).
The European Council meeting at Corfu in June 1994, decides that Cyprus would be
involved in the next enlargement of the EU and this is confirmed at its Essen summit in
December 1994.
The international status of the government of the Republic of Cyprus is reinforced by the
European Court of Justice in July 1994 through its decision that exports from the “TRNC”
had to be accompanied by phytosanitary certificates from the government of the Republic of
Cyprus.
In March 1995, the General Affairs Council, decides that accession negotiations would
commence six months after the end of the Intergovernmental conference and this is
confirmed by the European Council at its summits in June and December 1995 at Cannes
and Madrid respectively and in June and December 1996 in Florence and Dublin.
In July 1997, the Commission (1997) in its Agenda 2000, points out that the EU is
determined to play a positive role in bringing about a just and lasting settlement in
accordance with the relevant UN resolutions …
… states that agreement on a political settlement would permit a faster conclusion to the
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negotiations (the implication being that even in the absence of a political settlement the
negotiations will be concluded, albeit at a relatively later date).
The Luxembourg European Council in December 1997 decides to open accession
negotiations with Cyprus in the spring of 1998, and does so on the 30th
of March.
The Helsinki European Council in December 1999 underlines that a political settlement will
facilitate the accession of Cyprus to the EU but states that if no settlement has been reached
by the completion of accession negotiations, the Council’s decision on accession will be
made without the above being a precondition and taking account all relevant factors.
… but the EU has at no stage undertaken a binding commitment to end accession
negotiations within a given period and some Member States have indicated their hesitation to
vote for the accession of a divided island into the Union (see, for example, Agence Europe
Nº. 7339, 9th
and 10th
of November, 1998).
Greece, a Member State of the Union, has threatened to veto the forthcoming enlargement
towards the countries of Central and Eastern Europe, if Cyprus is not admitted.
The European Council meeting in October 2002 reiterates its preference for a reunified
Cyprus to enter the EU supports the efforts of the UN Secretary General for reaching a
solution and will accommodate the terms of such a comprehensive settlement in the Treaty
of Accession in line with the principles on which the European Union is founded. In the
absence of a settlement the decisions to be taken by the Copenhagen European Council in
December will be based on the Helsinki European Council of 1999 …
… moreover and in case of the accession of a reunified Cyprus it agreed to establish a
programme of € 206 million for the economic development of northern Cyprus to be
disbursed in the period 2004-2006.
The European Council meeting in December 2002 invited Cyprus to become a member of
the European Union as of 1 May 2004 …
… believes that the Comprehensive settlement presented by the UN Secretary General offer
a unique opportunity to reach a settlement …
… recalls its willigness to accommodate the terms of a settlement in the Treaty of Accession
in line with the principles on which the EU is founded …
… decided that in the absence of a settlement the application of the acquis to the northern
part of the island …
… and invited the Commission, in consultation with the government of Cyprus, to consider
ways of promoting the economic development of the northern part of Cyprus and bringing it
closer to the Union.