100 YEARS IN THE FIGHT AGAINST SMUGGLING

Hüseyin Cahit SOYSAL
UGM BOARD MEMBER

As long as "there is inadequacy in production and lack of product diversity" and "undue indirect taxes are imposed on the products sold in the domestic market," it is impossible to end smuggling only with police measures. Anti-smuggling laws that are equipped with adequate sanctions and effectively enforced can only deter people from smuggling to some extent. The important thing is to obtain the status of an "economically developed country."

The Istanbul Chamber of Commerce building, the most prestigious building in Sirkeci today, was used as the Sirkeci Customs Directorate Illegal Goods Warehouse until 1993. Although it was decided to be confiscated 40 years ago, it was never liquidated; therefore, it was a dump full of junk or trash.

The Ottoman Empire collapsed not only due to territorial losses but also due to the inability to pay public debts on time, leaving existing income sources to foreign countries under the name of capitulation. One of the first things to be done after the declaration of Türkiye's form of government as a "Republic" on October 29, 1923, was to "pay in installments the debts arising from the Ottoman capitulations" undertaken in return for the independence gained with the Lausanne Conference.

IMPORT SUBSTITUTION MODEL…

Undoubtedly, the daunting task of repaying these heavy debts was met with a remarkable display of resilience by Turkey. The country, with its limited income sources, embarked on a bold economic strategy- the 'import substitution model.' This model aimed to reduce imports by producing imported products domestically, while simultaneously striving to increase export resources. The export sector, at that time, was primarily focused on five agricultural products, fondly referred to as the 'classic five': hazelnuts, peanuts, figs, grapes, and tobacco.

THE FIRST INDUSTRIAL INITIATIVES WERE CARRIED OUT WITH PUBLIC HANDS…

Since there was no savings to make private sector investments in almost any field in the country in the 1920s, the first industrial enterprises emerged with the newly established State Economic Enterprises (SOEs). The most significant aid to Turkey, which was trying to stay away from the Western world, came from the Soviet Union (the union formed by Russia and the countries under its control). The Soviet Union was not content with selling machines to Turkey at long-term prices but also sent technical teams to assemble these machines and teach them how to use them. In other words, it not only sold hardware but also transferred know-how. Thus, the young Republic soon had facilities to produce fabric, shoes, sugar, salt, tea, and cigarettes. These were followed by SOEs producing electricity, iron and steel, copper, and fertilizer.

IT IS STILL TOO EARLY FOR THE MARKET ECONOMY…

However, although industrial production and access to final consumer goods became possible in almost every field, these businesses had to continue their existence as monopolies. Therefore, product diversity was limited, and it was too early to discuss a market economy. However, a wealthy segment of people not inclined to move away from the old consumption habits acquired from the Ottoman period were longing for European goods and trying to obtain these products illegally.

MESOPOTAMIA MEET PHYSICAL DISABILITY FOR THE FIRST TIME…

While the Republic of Türkiye was being restructured with the understanding of a "nation-state," it had to protect its borders with physical barriers. Otherwise, human trafficking and goods smuggling could not be fought. With this understanding, Mesopotamia, which has never been subjected to a physical obstacle since the foundation of the world, regardless of which state or empire it has been under, will encounter a physical obstacle for the first time. A wire fence would be built in the middle of the flat plains, and a 50-meter-wide minefield would be created on the Turkish side.

PUBLIC ORGANIZATIONS TO FIGHT AGAINST TRAFFICKING

On the other hand, public organizations were also required to fight against smuggling. To prevent smuggling, the Revenue Protection Office was established in 1859 under the command of the then Revenue Ministry. This organization operated under the Ministry of Finance until 1931. The organization was affiliated with the Ministry of Customs and Exemptions, established by Law No. 1909 in 1931, and was tasked with "safety and surveillance of borders and coasts, and the prevention, pursuit, and investigation of smuggling." This task was undertaken by the General Command of Customs Enforcement, established in 1932 by Law No. 1917. He continued his duty as General Commander until 1956.

FROM THE MINISTRY OF INTERIOR TO THE MINISTRY OF TRADE…

With the law no. 6815 and 6851 enacted in 1956, the Customs Enforcement General Command was abolished, and its military part was transferred to the Ministry of Internal Affairs. With the same legal regulation, the prohibition, tracking, and investigation of smuggling in the gates and ports where customs transactions are carried out, the Marmara Sea, the Dardanelles, and the Black Sea Straits and the customs area in these places were left to the Ministry of Customs and Monopoly. In the new structure, 1 Customs Enforcement Directorate was established at the Ministry Headquarters, 7 Customs Enforcement Directorates in the provinces, and six independent Regional Directorates. This organization was upgraded to the "General Directorate of Customs Enforcement" with the approval of the Minister in 1976 due to its increasing business volume and expanding staff. In subsequent administrative restructurings, the "General Directorate of Customs Enforcement," which served under the Prime Ministry Undersecretariat of Customs and the Ministry of Customs and Trade, was affiliated with the Ministry of Commerce with Article 45 of the Presidential Organization Decree No. 1 dated 10.07.2018.

"LAWS ON PROHIBITION AND PROCEEDING OF TRAFFICKING"

In the Republic's first years, "Laws on the Prohibition and Pursuit of Smuggling" numbered 1126 and 1510 were put into effect. Neither law contained heavy sanctions for smuggling. "Customs Tariff Law" No. 1499, which increased customs duties, came into force on 01.10.1929. The increased customs duties with the said law also caused increased smuggling incidents. Smuggling has reached massive levels, especially at our southern borders.

In 1932, Law No. 1510 was repealed and replaced by Law No. 1918 on the Prohibition and Pursuit of Smuggling. The new law included heavy sanctions. Accordingly, the defendants tried in smuggling cases had to be detained during the trial and await the case's outcome. If the conviction for smuggling crimes was finalized, the sentence could not be suspended. In severe cases, the penalty of exile began to be applied. Prison sentences can be up to 15 years. During the prosecution of smuggling cases, if the smugglers killed those responsible for interdiction and monitoring, the execution of the defendant could also be decided.

On the other hand, according to the provisions of Law No. 1918, vehicles are also confiscated as "vehicles used for the transportation of smuggled goods." Customs areas were filled with confiscated cars such as trucks, buses, automobiles, and horse carriages.

ACCEPTING ANIMALS AS "MEANS OF TRANSPORTATION OF ILLEGAL GOODS"

The most exciting thing was that animals such as horses, mules, and donkeys caught in smuggling incidents at our southern borders were considered "vehicles used in the transportation of smuggled goods," these were also seized. However, since these animals required care, they were handed over to reliable people among the border people. As the litigation process dragged on, the trustees, who used them as riding animals or plowing animals in the first years, said, "These overeat food when the animals got old and became useless." "I couldn't feed the animals." He wants to return it to the courts because They cannot find another person or authority to deliver them. The guards kill animals by poisoning them. When the situation was transferred to the case file with a report containing the phrase "the animal died of disease or old age," the trustees and the judges were relieved.

ILLEGAL GOODS WAREHOUSES WERE FULLY FULL…

On the other hand, as the cases heard in the high criminal courts turn into cases lasting for many years, the goods seized because they are smuggled goods and kept in the "Contraband Goods Warehouses" at the customs become damp, moldy, wilted, and rusted. Large mice in the warehouses gnaw the goods made of inputs such as fabric and leather. It was losing its commercial value. Since the goods could not be liquidated before the case was concluded, the Illegal Goods Warehouses were overflowing; The doors were becoming unopenable. For this reason, no transaction can be carried out by counting goods through "full detection" between the officer who has to transfer the duty of "Illegal Goods Warehouse Officer" to another customs officer because he is assigned to another region every 2-3 years, and the officer who takes over the duty; According to the existing records, the "Transfer Handover Report" was prepared and the warehouse clerk position was transferred to the new officer. Undoubtedly, such warehouses cannot be counted during periodic inspections; Minutes were prepared as if it had been done.

A MINIBUS CAME OUT UNDER THE PILES OF SACKS IN THE WAREHOUSE!

In 1982, when I was working as a Customs Inspector, I investigated the shortage of goods in the Illegal Goods Warehouse at the Gürbulak Border Gate. Together with the delegation we formed, we went to the door of the Illegal Goods Warehouse, where we would do a "count by scanning." As we opened the door, large sacks full of smuggled tea fell towards us. We tried to move towards the warehouse by carrying out the sacks, boxes, suitcases, and bales. Fighting cat-sized rats had become as difficult a task as fighting smuggling. We saw a large pile of sacks in the middle of the warehouse. A minibus emerged from underneath when the sacks were carried one by one. No one was aware of the existence of this minibus, including the warehouse clerk who received the warehouse in writing. After our lengthy investigations, we found that this was seized as a "vehicle used for the transportation of contraband goods" within the scope of a smuggling case still being heard in court. The administrators of the time took the minibus into the warehouse with the concern that "if we keep this minibus in the field, errand boys would steal its parts." However, we found out that they did not record it in the Warehouse Entry and Exit Book.

In other words, not only were the contraband goods kept until the end of the case, but preserving the means of transport used to transport these goods and keeping them intact or undiminished was a severe problem.

ISTANBUL CHAMBER OF COMMERCE BUILDING WAS AN ILLEGAL GOODS WAREHOUSE…

The Istanbul Chamber of Commerce building, the most prestigious building in Sirkeci today, was used as the Sirkeci Customs Directorate Illegal Goods Warehouse until 1993. Although it was decided to confiscate it 40 years ago, it was never liquidated. For this reason, I want to remind you that it is a dump full of junk or trash.

DURING THE ÖZAL PERIOD, THE EXPORT-LINKED GROWTH MODEL WAS SWITCHED…

Law No. 1918 on the Prohibition and Pursuit of Smuggling remained in force for 71 years. The private sector also developed in the country, which had a closed structure with the "import substitution model" from the 1930s to the 1980s. Apart from SOEs, large industrial enterprises established production capacities above Türkiye's needs. When Turgut Özal became Prime Minister in 1983, regulations that would significantly transform the economic structure were put into effect one by one. It moved away from the closed import substitution model and switched to an externally open export-dependent growth model. By removing foreign exchange restrictions, foreign currency became a value that could be bought and sold by private banks or individuals. The status of SOEs and state monopolies was terminated, and a return to a competitive market economy was achieved.

CUSTOMS UNION WITH THE EUROPEAN UNION…

In 1995, efforts to establish the Customs Union (CU) with the European Union (EU), constantly postponed since the Ankara Agreement was signed in 1963, were accelerated. The GB above was achieved as of January 1, 1996.

It was time to align the anti-smuggling regulations with this structural transformation. Law No. 1918 was abolished with the "Anti-Smuggling Law" No. 4926, which came into force in 2004.

"ECONOMIC PUNISHMENT FOR ECONOMIC CRIME" PRINCIPLE…

In Law No. 4926, no prison sentence is foreseen for smuggling crimes in line with the principle of "economic punishment for economic crime." Only fines could be imposed on the defendants when the cases were concluded. The law was presented to society as a reflection of the open economy as a requirement of the new liberal order. However, this law lasted briefly and remained in force for only three years.

DIFFERENTIATION OF CRIME AND MISDEMEDIATES BY EU LEGISLATION…

Within the scope of compliance with EU legislation, it became necessary to distinguish between "crimes" and "misdemeanors" and to reflect this understanding in the laws. In the "Turkish Penal Code No. 5237", which came into force in 2006, only the definition of crime was made, and the prison and judicial fines for these crimes were determined. With the "Law on Misdemeanors" No. 5326, misdemeanors were defined, and it was envisaged that administrative penalties, administrative sanctions, and administrative measures would be imposed on those who committed these misdemeanors. The Anti-Smuggling Law had to be subject to the same classification in this context. In the studies carried out, the provisions of Law No. 4926 that caused pauses in practice were reviewed. The article texts were simplified, and the general provisions regulated in Laws No. 5237 and 4326 were removed from the text of the law, and a new text was prepared. As a result of these studies, "smuggling crimes" were defined in the Anti-Smuggling Law No. 5607, adopted on 21.03.2007, and penal provisions were determined. "Smuggling misdemeanors" were added to Customs Law No. 4458.

IMPORTANT CHANGES MADE WITH LAW NUMBER 5607…

Unlike Law No. 4926, detailed crime definitions and penalties for cigarette, alcoholic beverage, and oil smuggling were added to Law No. 5607. We can list other vital changes that changed the understanding of 1918 as follows:

The concept of "smuggling by using forged documents" has been changed to "smuggling by deceptive transactions and behavior."

• The phrase "who obtains unfair advantage by making use of incentives, subsidies or monetary refunds by the provisions of the relevant law by making it seem as if the export has occurred when it has not been realized, or by changing the type, quantity, quality or price of the goods subject to export" To benefit from exports, it was changed to "pretend that the export has occurred when it has not been realized, or show the type, quantity, characteristics or price of the goods subject to export differently."
• Those who produce, possess, transport, or sell fuel that does not contain the "national marker" or has this marker below the level determined by EMRA are sentenced to imprisonment from two to five years and up to twenty thousand days in prison.
• Most importantly, for "vehicles used for the transportation of smuggled goods," if it is not registered in Turkey or if it is used again in the commission of the smuggling crime while the investigation and prosecution are ongoing, the seized vehicle is detained by the authorities that gave the seizure decision." Suppose the owner delivers the guarantee equal to the vehicle's value to the customs administration within thirty days from the date of detention. In that case, the car will be returned to the owner. Otherwise, it will be liquidated immediately by the liquidation administration without waiting for the outcome of the investigation and prosecution." This provision was included.
• Again, according to the same Law, "Goods for which confiscation sanctions can be applied due to being the subject of crimes defined in this Law cannot be returned to their owner. For all kinds of goods, except smuggled fuel, seized on suspicion of smuggling, within six months from the date of seizure, but within one month if there is a risk of damage to the goods or a significant loss in value or if their preservation creates a serious burden, the necessary determinations are made. During the investigation phase, the judge prosecutes. At this stage, the court decides on liquidation. The goods will be liquidated immediately if a decision is not made within these periods. "In cases where it is possible to take samples from the goods to be liquidated within the scope of this paragraph, before being liquidated, samples are taken; in cases where it is not possible to take samples, all distinguishing features of the goods are determined." provision was added. In the next paragraph, "The sales price of the goods or vehicles sold and liquidated is transferred to the escrow account. Suppose it is decided to return the liquidated goods or vehicles to their owners. In that case, the sales price is paid to the rightful owner together with legal interest for the period from the date of seizure to the date of return, within the framework of the provisions of Article 180 of the Customs Law. "If the amount in the escrow account does not cover the payment to be made to the rightful owner, the difference, and if the goods have been destroyed, the price of the destroyed goods shall be covered by the customs administration from the relevant part of the general budget and paid to the rightful owner." It was said.

In other words, the regulations introduced by Articles 10 to 16/A of the Anti-Smuggling Law No. 5607 were made to bring the "goods caught as smuggled" and "vehicles used to transport smuggled goods" into the economy by liquidating them without losing economic value and without waiting for the conclusion of the case. The customs administration was also largely freed from the "Illegal Goods Warehouse" torment and investigations.

IT IS NOT POSSIBLE TO END IT WITH POLICE MEASURES ONLY...

The most crucial point that should not be forgotten on the subject is this: As long as "there is inadequacy in production and lack of product diversity" and "more indirect taxes are imposed on the products sold in the domestic market," it is not possible to end smuggling only with police measures. Anti-smuggling laws that are equipped with adequate sanctions and effectively enforced can only deter people from smuggling to some extent. The important thing is to obtain the status of an “economically developed country.