public administration and development

Public Admin. Dev. 27, 319–332 (2007)

Published online 13 April 2007 in Wiley InterScience
(www.interscience.wiley.com) DOI: 10.1002/pad.448

INDEPENDENT REGULATORY AGENCIES IN TURKEY:

ARE THEY REALLY AUTONOMOUS?
SERİYE SEZEN*
Public Administration Institute for Turkey and the Middle East, Turkey

SUMMARY
This article examines the autonomy of independent regulatory agencies (IRAs) in Turkey. It explores, first, the different factors
that have led to the creation of IRAs and second, the legislative basis of their formal or de jure autonomy. Thereafter, the article
assesses the extent to which this formal autonomy is really put in practice and how it is perceived by board members. The enquiry
was conducted through a survey comprising interviews and a questionnaire applied to the same. It concludes that although
formal autonomy is satisfactorily provided for by law, government tends to limit this autonomy through secondary legislation.
Consequently, there are some constraints on the actual use of autonomy. Concerning de facto autonomy, survey findings show
that boards are exposed to external and internal pressures and interference in their deliberations. Thus, the assumption that ‘the
greater the autonomy the more efficient the management’ is questioned. The main sources of pressure on board members are
from the regulated sectors themselves. These findings have an important bearing on democracy and the political–administrative
interface, as it is confronted by market forces. Copyright # 2007 John Wiley & Sons, Ltd.

key words — regulatory state; agencification; independent regulatory agencies; autonomy; de jure and de facto autonomy; Turkey

INTRODUCTION
‘Agencification’ has been in vogue for over two decades. Some scholars have even noted that ‘an outbreak of
internally infectious agency flue’ had occurred (Pollitt et al., 2001). Creating autonomous organisations such as
agencies stems largely from the pursuit of New Public Management (NPM) ideas in the public sector (Bouckaert and
Peters, 2004). A central idea behind agency creation in this connection is that autonomy is seen as important in order
to shelter management functions from interfering politicians. It is also assumed that greater autonomy will produce
more efficient, productive, economical and qualified services (Caulfield et al., 2006) which can be measured
objectively and quantitatively (Yamamoto, 2006). This is because ‘(autonomy) can allow managers greater
opportunity to exercise their full abilities’ (Bouckaert and Peters, 2004) and make them more responsible for their
actions. In other words, autonomisation or agencification is seen as a panacea for solving managerial problems.
Despite these expectations, some research reveals evidence for taking a more cautious view (Pollit, 2000; Pollitt
et al., 2001; Verhost et al., 2004; Yamamoto, 2006). Moreover, it is also recognised that there can in fact be
unexpected negative outcomes resulting from agentification (Tavits and Annus, 2006).
Accordingly, given the continued popularity of agencification, it is important to achieve a better understanding
of one of the key forms: independent regulatory agencies. Despite the shift of academic interest from privatisation
and deregulation to regulation and regulatory agencies, the literature on the latter—though considerable—remains
incomplete. IRAs are studied from the point of their functions, competences, organisation, independence and their
impact on the political arena (Majone, 1996, 1999; Thatcher, 2002, 2002a, 2005; Gilardi, 2003). Autonomy and
independence are among the most discussed aspects. Some argue that although a certain independence from
political and bureaucratic controls is necessary, one must ‘not overstate in theory the degree of independence that

*Correspondence to: S. Sezen, Public Administration Institute for Turkey and the Middle East, TODAIE.1.Cadde, No. 8, Yucetepe 06100
Ankara, Turkey. E-mail: ssezen@todaie.gov.tr

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exists in practice’ (Majone, 1999). On the other hand, Wilks and Bartle (2002), consider independence from a
political point of view and the limits. This school of thought sees formal independence as a façade.
Autonomy is about discretion. It can be defined as an agency’s capacity to take decisions without any external
intervention. Thus, ‘the level of autonomy is determined by scope and extent of the agency’s decision-making
competencies’. (Verhoest et al., 2004). As an umbrella concept, autonomy has several dimensions: managerial,
policy, structural, financial, legal and interventional (Verhoest et al., 2004). All these are interrelated and one affects
the other. It should also be stressed that de jure autonomy is not always a sensitive indicator of de facto autonomy;
what is important is the way it actually works. As a matter of fact, de jure and de facto autonomies are not always in
concordance.
This article examines the de facto autonomy of IRAs in Turkey. Significant autonomy is considered important to
Turkish IRAs. It is held that if IRAs have formal autonomy, then they will function in a more efficient, professional
and neutral way than other bureaucratic organisations. But a main issue remains: are they really so autonomous in
practice and as their legal frameworks would suggest?
This question is discussed under two headings. First, what were the factors leading to the creation of these
institutions and how was the framework for their de jure autonomy drawn up? Second, the article evaluates the
IRAs’ de facto autonomy in terms of the extent of independence they enjoy in their decision-making processes.
The first section is based on a study of the legislation governing the IRAs, the outcomes and their achievements.
De facto autonomy is discussed in the light of two sets of data, the first of which was gathered from structured
interviews conducted with the chairmen, deputy chairmen and some members of the IRAs’ boards. The second set
of data was collected from the findings of a questionnaire applied to the chairmen and the members of the board.

MAIN FACTORS LEADING TO THE CREATION OF IRAS

Since the 1980s, the state in Turkey has been going through a restructuring process in line with its liberalisation and
privatisation policies. The privatisation of public enterprises and the abolition of the state monopolies began in the
mid 1980s. Liberal policies have enhanced the regulatory role of the state while weakening its power as an
economic actor in the market. Independent regulatory agencies emerged in the early 1980s in order to perform this
growing new role of the state. The first IRA, the Capital Markets Board, was established in 1982. There are
currently nine IRAs regulating capital markets, banking, radio and television, competition, energy, tobacco, sugar
and public procurement.
Factors that have led to the creation of IRAs are closely connected with developments in the outside world.
Whilst the proliferation of IRAs in Europe and Turkey can be explained by the transition from interventionist to
regulatory state, yet these concepts themselves are clearly problematic. While the existence of a state presupposes
regulatory activities, state regulation in any area also means state intervention in that area. Certainly there are other
forms of intervention apart from regulation. For instance, resource allocation, income redistribution and enterprise
promotion are equally interventions in the economic arena. On the other hand, determining the duration of
compulsory education is an intervention in the social domain. The state may use several forms of intervention at
sector level. For example, private and state banks, as well as private and state schools have coexisted in Turkey’s
earlier mixed economy and continue to do so in today’s free market economy. The state both actively participates in
and regulates the banking and education sectors. This dual intervention of the state as a major player and regulator
endures in social sectors; but in the economic sector, the state is becoming increasingly more focused on its
regulatory role alone. ‘Regulation’ and as a consequence intervention is maintained, but its methods, content and
organisation (IRAs in place of traditional agencies) are altered. The ‘regulatory state’ is a concept re-defining the
role of the state and its limits of intervention in the market economy. In short, a regulatory state is a state which
withdraws from its function of redistributing income. It does not produce goods and services unless absolutely
necessary and only in order to ensure the proper functioning of the markets in accordance with market rules.
The main factor in the emergence of IRAs in Turkey are liberalisation policies. But the implementation of these
policies and the proliferation of the agencies in Turkey owes a lot to major external pressures. As a matter of fact,
Turkey is not the only country to have faced such external pressures. European Union (EU) countries are also under

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pressure exerted by the EU institutions (Della Cananea, 2002; Hoff, 2005). But Turkey, as an EU membership
candidate and as a country drawing loans from the IMF and the World Bank has felt these multiple pressures more
strongly.
Factors leading to the creation of IRAs in Turkey can be grouped under three headings:

Privatisation and the abolition of state monopolies

The opening of sectors that were previously closed to private entrepreneurs gave way to the establishment of
agencies to regulate these areas. For instance, the Radio and Television Supreme Council (RTSC) was founded in
1994, after private broadcasting enterprises had been authorised. But the opening of a sector to private activity has
not always given rise to the creation of an IRA. In some areas, the authorities opted to change the functions of an
organisation running the state monopoly and to grant it regulatory powers. For instance, employment services,
formerly run by a monopolistic public agency, are today run by both the Turkey Employment Institution (TEI) and
private employment offices. But TEI also enjoys powers akin to regulatory bodies vis-a-vis over private
employment offices.

EU Accession Process
Turkey’s relationship with the EU as a candidate country has placed the government under an obligation to establish
an economic system where a fully competitive market economy operates with all its institutions and rules. Such an
obligation has had a profound impact on the proliferation of IRAs. For example, the Act establishing the Turkish
Competition Agency (CA) in 1994, was a precondition for the accomplishment of the customs union between the
EU and Turkey on 1 January 1996. EU also requires the establishment of other IRAs and closely monitors the
performance of existing IRAs.1

Requirements of International Organisations

IMF and the World Bank have played a significant role in the setting up of IRAs, particularly during the 1990s and
2000s. Privatisation in certain sectors and creation of IRAs in the same was a consistent condition in many letters of
intent addressed to the IMF, as well as in loan agreements concluded with the World Bank. Public Procurement
Agency (PPA), Energy Market Regulatory Agency (EMRA), Sugar Agency, The Tobacco, Tobacco Products and
Alcoholic Beverages Market Regulating Agency (TABMRA) are among IRAs established under the influence of
IMF and the World Bank.
In short, IRAs’ proliferation in Turkey came about as a result of external demands and stimuli rather than the
natural choice of governments and Parliament.2

FORMAL AUTONOMIES OF IRAS

Regulatory authority organisations can be classified under three main headings: industry-specific, in which there is
a separate agency for each industry; sector-wide, in which there is an agency for each more broadly defined sector
and multi-sector, in which there is a single agency for all or most utility industries (Smith, 1997). In Turkey, IRAs
are mostly industry-specific organisations. Owing to its nature, the Competition Agency is the only agency that
bears a multi-sector responsibility. The sector-wide organisational mode has been chosen only for the energy

1
For example the deregulation of postal services and the creation of an independent regulatory agency in that area are among continuous demands
of progress reports on Turkey’s accession to EU (http://europa.en.int/comm/enlargment/report_2005/pdf/package/sec_1426_final_en_
progress_report_tr.pdf (20.01.2006).
2
The following statement of Mr. Bulent Ecevit, then Prime Minister, reflects this situation: ‘I should confess that we passed the limit on giving the
autonomy. It is said that this is necessary for democracy, market economy and it’s a demand emanating from the IMF. Many public institutions
have become the independent institutions that are totally out of the supervision and the influence area of the state and the government. The
businessmen, who come to Ankara, know that many authorities have slipped through our fingers. They want to see the government and the sate in
front of them. . . . the state is totally left on the sidelines with regard to banking or any other sensitive subject. We can put up with it, but the people
cannot’ (Cumhuriyet, 2002: 5).

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market. The Energy Market Regulation Agency, set up to regulate the electricity market, was later tasked with the
regulation of natural gas, liquefied petroleum gas and oil markets.
It would be useful to describe the characteristics of IRAs (their legal status, powers, decision-making bodies etc.)
as a framework for formal autonomy.

IRAs’ status
IRAs are established by law. Relevant Laws lay down the general rules for the management and scrutiny of a sector
and, at the same time, establishes an independent regulatory agency with the requisite powers over that sector. IRAs
are public corporate bodies and have administrative and financial autonomy (except the Sugar Agency). Their
founding laws, in most cases, stipulate their independence in decision-making and prohibit anyone from interfering
with their decisions.

Powers
IRAs have comprehensive powers for direct exercise in a particular sector. Unlike some European countries,3 they
do not share sectoral responsibility with the central government. They are allowed to exercise their powers without
seeking any ministerial or other departmental approval. IRAs have the power to prepare secondary legislation, to
issue licenses, to monitor and audit, to impose sanctions (including administrative fines) and to solve disputes in
their relevant sectors.
For instance, starting a bank, mergers between banks and acquisition of banks are subject to the approval of the
Banking Regulation and Supervision Agency (BRSA). In the past, some of these powers were in the hands of the
Council of Ministers. Furthermore, the sanctions available to the BRSA range from dismissing the board members
of a bank to the seizure of a bank for placement under temporary public ownership.
Some agencies exercise further powers that do not fall under the above categories. For example, Radio and
Television Supreme Council is empowered to make nominations to the Council of Ministers, for the post of
Director General and for the board members of Turkish Radio and Television Corporation. The Competition Board
must be consulted and must give approval for any privatisation process in order to prevent the formation of
uncompetitive entities in the market.
While the agencies wield wide powers over their relevant sectors, in some areas their powers are restricted. For
instance, the TABMRA, the IRA in the tobacco and alcoholic beverages market, has no control over alcoholic
beverages. This is due to the law governing the production and inspection of food, which classifies alcoholic
beverages as food products and as the production, supply and control of food products is the responsibility of the
Ministry of Agricultural and Rural Affairs. This creates a certain amount of tension between the Ministry of
Agricultural and Rural Affairs and the TABMRA (interview with chairman A).

Decision bodies
Decisions in Turkey’s IRAs are not taken by an individual but by the boards. The number of board members varies
between seven and ten.4 Their term of office is five or six years. In most of the IRAs, re-appointment of a member is
possible. Appointments’ procedures are not uniform. While RTSC members are appointed by the Parliament, other
IRA members are chosen by the Council of Ministers. Some agencies put forward their own nominations. EMRA
members are directly appointed by the Council of Ministers, and BRSA members are appointed from a list of
candidates proposed by the related Minister of State, and others are selected from among the candidates designated
by other institutions or authorities, such as the Council of State, the Court of Audit, the Supreme Court, related
ministers, regulatory agencies themselves, professional bodies, employers’ associations and representatives of the
markets. Eligibility conditions for IRAs’ members are laid down in the law and the principal ones are as follows:

3
For instance, in France the Minister of Economics was empowered to impose administrative sanctions to anti-competitive practices (Demarigny,
1996: 170) while in Spain the basic responsibility over the control over mergers lies with the government and not with the regulatory authority
(Cases, 1996: 193–194).
4
The numbers of members are as follows: RTSC nine; PPA ten; CMB, CA, BRSA, EMRA, TA, SA and TABMRA seven each.

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holding a university degree in their respective fields, to have a working experience in that domain either in public or
in private sector for at least 10–12 years; to have professional knowledge and experience etc. In order to prevent
practices that serve the self-interest of members, certain prohibitions have been set.
On the other hand, members are provided with an element of job security to prevent their removal from office for
arbitrary political reasons. They can only be removed from office under particular circumstances specified in Law.
However, in practice, this mechanism does not operate without problems. Although they cannot be removed from
office per se, it is possible to eliminate members by using methods like forcing them to resign or re-arranging their
term of office. There are examples where members have been removed by using these methods.5

Direct enforcement of decisions

IRAs’ decisions on the markets are directly implemented without the need to seek approval from any authority.6
Decisions are subject to the judicial review.

Budgets
Financial autonomy is one of the cornerstones of a broader autonomy, as economic dependence leads to further
dependencies. Agencies do not depend on the government for their sources of income. They obtain their income
from the sector they regulate via contributions, licensing charges etc. Although they have the option to draw
financial support from the central budget, this has not been necessary. In fact, some IRAs have a budget surplus.
At the outset, the IRAs had full autonomy over their spending. But in the 2000s, interventions, in the shape of
attempts to curb their financial freedom, began. Placing restrictions on pay rises for staff, making the approval of the
State Planning Organisation before any property purchases are compulsory and the obligation to seek the
permission of the Prime Minister’s Office for temporary foreign assignments are some examples of these
interventions. The latest financial measures require the IRAs to transfer their entire income surpluses to the
Treasury and to submit their budgets for Parliamentary scrutiny as of 2005. So, although their autonomy to generate
income remains the same, the government seems intent to discipline IRAs’ spending.

Relations with the government and the Parliament

The relations between the IRAs’ and the government are managed by state ministers who act on behalf of the Prime
Minister or by one of the Ministries. One important aspect of these relations is the appointment process. The
Council of Ministers is the appointing authority, and during that process, serious bargaining takes place. Yet these
bargaining delays in appointments may prevent boards from making decisions. This is not only true for coalition
governments, but does occur among fractions of a one party government.
IRAs send their annual reports to the Council of Ministers every year. But the Council of Ministers does not have
an established procedure to process these reports. On the other hand, the relevant ministries do not have a clearly
defined power of scrutiny over the IRAs.
As for the relations of IRAs with the Parliament, at first there were no connections between the IRAs and the
Parliament, with the exception of the RTSC. But one of the criticisms levelled at these agencies is the lack of the
accountability to the Parliament. Now since 2005, following a new law on Public Financial Management and
Control Law No. 5018 they have to submit their budgets to the approval of the Parliament.

Means of control over IRAs

IRAs’ decisions are open to the judicial review. They fall under the jurisdiction of the Council of State, which
operates as administrative court of appeal. Besides this judicial review there are other control mechanisms

5
Three chairmen have been appointed to BRSA during its first three years (2000–2003). The first one appointed for six years has resigned after
only 11 months, and the second after 20 months (BDDK, 2003). The first group of members also appointed for six years were dismissed before
the end of their second year in office through an amendment of the related legislation.
6
The government would rather prefer to endow the relevant minister with the right to bring action against board’s resolutions. This is the case for
BRSA at the moment. Its extension to other IRAs is expected.

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operating under the President of the Republic and under Prime Minister’s Office. It goes without saying that these
controls are limited to administrative functioning of the IRAs and do not include their decisions themselves. These
controls are not regular. They are realised only in the case of a special demand emanating from the President or the
Prime Minister. Finally, IRAs are also controlled through the Court of Audit from a financial perspective.
Verhost et al. (2004) establish a scale of the autonomy, taking different dimensions of autonomy into account
(such as managerial, policy, structural, financial, legal and interventional) and determining four different levels as
minimum, low, high and maximum according to some characteristics. If we follow them, we may say, in the light of
above-mentioned features, that IRAs of Turkey reach maximum formal autonomy level in policy and financial
aspects; and high level in managerial, structural, legal and interventional aspects.

THE EVOLUTION OF IRA EXPERIENCE

Three main trends could be deduced from Turkey’s experience of IRAs. First, a considerable number of these
agencies were hastily established by somewhat reluctant governments as a result of demands from the EU, the IMF
and the World Bank. Their legislation has also been criticised for being mere translations of foreign legislation.
Second, the intention behind the creation of these agencies was to narrow down the sphere of influence of
politicians. The fact that the IRAs were endowed with certain privileges that are unusual in Turkish public
administration, such as irremovability of members limited control, large financial resources and freedom of
expenditure, reflect this intention. In other words, the IRAs were kept largely exempt from many limitations that
apply to other public organisations.
Third, from late 1990s onwards, governments began to regret the privileges of the IRAs and went on to limit their
freedom. This was followed by limitations placed on IRAs’ financial liberty and resource utilisation, for example,
limitations set to the salaries of staff and board members; the obligation to transfer revenue surplus to the treasury;
the requirement for board members and staff to obtain an authorisation from the Prime Minister’s Office for
travelling abroad. In short, governments have seriously narrowed down the IRAs’ original freedoms and have
brought discipline to their workings. The last step of this operation is the submission to the Parliament of a draft law
aiming to standardise the organisation and operations of IRAs. This draft law has been publicly criticised as a step
to weaken agencies’ autonomy.

DE FACTO AUTONOMY OF IRAS

The purpose of the survey
The autonomy of the regulatory agencies and their independence from governments and market forces is the raison
d’etre behind the creation of these agencies. In the literature on IRAs, there are a number of studies of both the
functioning (see, Thatcher, 2002) and de jure autonomy of these agencies (TUSIAD, 2002; Gilardi, 2003). The
purpose of this article is to assess the functioning of IRAs’ de facto autonomy through an ‘insiders’ evaluation’ i.e.
through their board members.

The scope of the survey

The study includes eight out of nine existing IRAs in Turkey. As the Sugar Agency’s members are not employed
full-time, they have been excluded.

The design of the survey

The survey entailed two steps. Direct semi-structured interviews were conducted with the chairmen, deputy
chairmen and some of the board members. Interviews were made in the agencies’ head offices in Ankara. Besides
the interviews, a questionnaire was applied to all members including the chairmen and the deputies. Questionnaires
were delivered by hand and collected later on. The questionnaire has a total of 21 questions of which ten are open
ended. Questions can be classified into five groups in relation to the nature of information sought:

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1. Information about the subject’s professional duties and functions (the board in which he/she is appointed, his/her
term of service in the related sector, his/her term of office in the agency, etc.).
2. Members’ assessment of their agencies’ competence and de jure autonomy.
3. Sources of intervention, if any, which board members are faced with during their deliberations and their level of
resistance to the same.
4. Whether the members feel secure in their posts or not.
5. The way the members prepare themselves for the meetings and the way in which decisions are debated.

The population of the survey

In the spring and summer (May–August) of 2005 when the survey was carried out, the total number of posts in eight
IRAs was 67. As four seats were vacant, the questionnaire was distributed to all 63 members. Therefore, the survey
was not conducted on a sampling basis but on the whole population. 47.6% of the questionnaires were returned. In
spite of all efforts by the surveyor, no questionnaire was received from EMRA.

FINDINGS
Duty profile of the subjects
66.7% of subjects are members and 26.7% of them also hold the title of chairman or deputy chairman. Although
board membership is open to persons from both the public and private sector, most of the members (more than 80%)
are from the public sector.7 They have a longer length of service than those with a private sector background.
As the term of office for IRAs’ board members is not limited to a single term, what would be the ratio of
re-appointment of members? The proportion of members whose term of office lasts more than five years is 10%. As
members are appointed for five or six years and are eligible for re-appointment, one can say that the re-appointment
ratio is low. In another survey based on the study of board members’ CVs, it is observed that 77% of board members
are in their first term of office (Sezen, 2005).

Are IRAs’ powers sufficient for effective regulation and control?

60% of subjects find their agencies’ powers ‘partly sufficient’ for an effective regulation and control over the related
sector. The ratio of those who find them ‘sufficient’ is 33.3% and of those finding ‘insufficient’ is only 6.7%.
Three points emerge from answers to open ended questions that asked subjects to specify why they felt their
powers were insufficient: (a) insufficiency/ineffectiveness of sanctions; (b) insufficiency of relevant legislation in
regulating some matters and, (c) conflict/sharing of powers.
While some of the board members complain about the insufficiency of sanctions themselves, some others stress
that delays in legal proceedings make sanctions ineffective. The agency most affected by the delays in legal
proceedings is the RTSC. Indeed, when RTSC decides to suspend a channel’s broadcast, the decision is challenged
at the courts and in many cases a stay of execution is obtained. As a result, the disputed programme is broadcast and
comes to an end while the courts are still deliberating. That situation makes the court’s verdict completely
inapplicable even if the final verdict is in favour of RTSC and makes the sanction virtually ineffective (interview
with deputy chairman A). Another problem in judicial review is that sectors are not yet familiar with the idea of
regulation by the IRAs, and they have a strong tendency to challenge almost all of IRAs’ resolutions at court;
regulatory agencies are usually unable to defend their decisions properly. Multi-national companies who can start
legal proceedings have the advantage of employing very powerful and experienced lawyers and can influence the
court, while the IRAs have to put their case with a small number of less experienced lawyers. Hence, in the legal
proceedings, IRAs may stage a weaker defence against the opposing parties. Furthermore, the IRAs have a mistrust

7
This ratio is similar to data obtained from three continental European countries. In Germany, Italy and France, the ratio of members coming
from public sector is respectively 92, 76 and 74%, while in UK it is significantly lower (Thatcher, 2005: 357).

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of courts. They believe they lack the expertise required to judge their collective decisions from expert knowledge of
the sector (interview with deputy chairman A and board member A).8
Another point of complaint is the lack of sanctions against public institutions that do not comply with the board
decisions or where there are sanctions available, the intervention of relevant ministers on behalf of the public
institutions to minimise the impact of such sanctions.
Most respondents agree on the inadequacy of sanctions; however some have different thoughts on the matter. For
instance, the chairman of EMRA describes the level of penalties the agencies can impose as a ‘deadly blow’ rather
than ‘a corrective penalty’ and says that they have asked for a reduction in the level of penalties (interview with
chairman B).
The areas where members feel they do not have adequate powers differ from one agency to the other. For
example, in the Competition Agency, the main points of criticism are incomplete procedure provisions and the
impossibility of control over state aid from the point of view of competition. Deficiencies and contradictions in
legislation and insufficiency of organisational provisions are also criticised.
Two agencies are concerned about conflicting or shared powers. One of them is the RTSC which believes that the
decision to transfer the power of frequency planning and allocation from itself to Telecommunications Agency is a
mistake. The other, the TABMRA, complains of a power conflict between itself and the Ministry of Agriculture and
Rural Affairs; declaring that it could not control the alcoholic beverages market, because of the prerogatives of that
ministry.

Is the institutional autonomy satisfactory?

Almost all members (93.4%) share the opinion that institutional autonomy is ‘partly’ or ‘completely’ secured for
agencies via the relevant legislation. Those having the contrary opinion correspond to 6.7% of the whole. The
Capital Markets Board seems to be the most satisfied agency with its institutional autonomy.
Although the answers given to the open-ended questions and impressions gleaned from the interviews suggest
that the agency autonomy as set by the legislation is evaluated as adequate in general, the problem arises when
putting this de jure autonomy into effect. Majority of the subjects declare that the autonomy given by the relevant
laws is being weakened by the Prime Minister’s circulars. These circulars bring new constraints such as the
necessity to get the approval of the State Planning Organisation for investments, or the approval of the Prime
Minister’s Office for assignments abroad. Besides, IRAs have been compelled to transfer their revenue surplus to
the Treasury. IRAs are not constrained revenue generation, yet they consider that their autonomy is breached when
it comes to spending it. Therefore, it is generally agreed that guarantees given to IRAs by laws for their
administrative and financial activities are weakened by decrees or circulars.
Unlimited terms of office for members are also seen as an element of threat against de facto autonomy and there
are proposals to end the practice, as the expectation for re-appointment is regarded as a potential incentive for some
members to make concessions to those who will re-appoint them. Furthermore, it is also thought that the selection
of members from among the candidates nominated by related ministries could affect autonomy and create a relation
of dependence. One member, who regards the merits of the members as more important than the legal guarantees of
autonomy, maintains that autonomy cannot be exercised on legal provisions alone, unless the members are well
qualified. According to him, autonomy is needed for effectiveness. Without effectiveness autonomy may be
detrimental and may even become arbitrary (interview with board member B).
There are also some members who think that administrative supervision may turn into control of opportunities
and may well be used as a tool of pressure. Moreover it could also be used as a manifestation of jealousy. On the
other hand, members think that a common set of criteria for administrative supervision has not been developed. For
instance, a board chairman states that the content of supervision may vary according to the controller’s ideology;

8
OECD stressing that many countries establish a specialist regulatory appeal body that includes experts in regulatory issues, suggest indirectly a
similar path for Turkey. According to OECD, courts often are not well suited to regulate or to review regulatory decisions, because of the
technical nature of the issues in contention and the need for speedy resolution of outstanding issues. (OECD, 2002: 112).

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whether he or she is liberal or statist. So a matter which is not considered a problem at one agency could be seen as a
major issue at another, according to the personal approach of the inspectors (interview with chairman C).

Do the boards face interventions in their deliberation process?

The most important indicator of IRAs’ actual autonomy is the ability to make completely independent decisions
according to the free will of their members, without any external influence. But one needs to clarify the concept of
influence. It is obviously very difficult to isolate an entity from all kind of influence in the decision-making process.
After all, members are only human and are somehow affected by their environment.9 What is important is that
members should decide on their own free will and that they should not be forced in any way to act otherwise.
Protecting the autonomy of the decision-making process goes beyond protecting it against external influences. In
this context, autonomy can be classified as external and internal. External autonomy means that boards are not
subject to external pressure and interventions (from government, market forces, media, public bureaucracy, etc.)
and that they have the capacity to resist them if it occurs. On the other hand, internal autonomy exists if board
members do not face interventions either within the board (from chairmen or other members) or within the agency,
and if they are able to resist to such interventions.
Two questions have been asked to members in order to determine the de facto autonomy in the decision-making
process. They cover the following points; (a) external interventions on the board and board’s capability to resist as a
whole; (b) whether board members personally face requests either from within the agency or from outside of the
agency intending to influence boards’ decision; and if so, the sources of these requests.
At a first glance, questioning the interventions on the board and on its members separately may not seem
meaningful. Obviously interventions on the board as a whole are always exerted via its members. Posing the
question at two levels is necessary because the interventions that may take place vis a vis the board as a whole and
vis a vis individuals members may be different. On the other hand, the possibility of members being exposed to
requests from their superiors, their colleagues or even their friends has also been considered.
60% of members believe that the board is never exposed to external intervention, whereas 40% of them think that
there have been sporadic interventions (Table 1). In every board there is at least one member who accepts the
existence of interventions, except the Capital Markets Board where all members deny the existence of any
intervention. RTSC and the Telecommunications Agency seem to be the agencies most exposed to external
intervention.
The majority of members admitting to the occurrence of interventions (40%) think that interventions come from
either the regulated industry itself or from the political sphere.
Interventions aimed at the boards are generally indirect. One of the indirect means of exerting pressure that
either the government or enterprises can use is the media. For instance, before strategic decisions are taken,
pressures may be exerted on the board through politician’s statements or columnist’s articles. In this regard, it
should be emphasised that media corporations close to the government play an important role.10 It seems that media
pressure is particularly strong with regard to RTSC. While RTSC monitors and controls broadcasting channels, it is
itself under close observation and informal control exerted via newspapers belonging to same corporations owning
these channels. In particular, they watch the members of RTSC closely and when necessary they do not hesitate to
expose their private lives on their news agenda (interview deputy chairman A). Another way of indirect intervention
is courtesy visits. This method consists of a visit to the agency by the related minister just before a strategic decision
and giving an implicit message to the members in a friendly chat on the issue which is to be decided by the board
(interview with board member C).

9
Some members point out that ‘it is impossible to disregard the environment completely’ and that is necessary to keep communication channels
with the sector working. Otherwise that would be a vain effort as trying to regulate an area you do not know thoroughly (interview with deputy
chairman B and board member B).
10
A strong tendency is observed among giant holdings in Turkey during the last two decades, to invest in the sector of mass media. Many
companies operating in sectors like, industry, banking, stock market, energy, telecommunication etc., acquire newspapers, reviews, TVor Radio
channels and they become powerful in that domain. Thus if a regulatory agency resolution happens to be against their interest, they can attack it
directly via the media and can manipulate the public opinion in their favour.

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Table 1. Does the board face external intervention?

Questions Does the board face Is the board capable of
external interventions? resisting to interventions?

Most of the time Some times Never Most of the time Some times Rarely No response

IRAs BRSA — 2 3 — 1 1 3
RTSC — 3 1 2 2 — —
PPA — 1 3 1 1 — 2
CMB — — 4 — — — 4
TABMRA — 1 3 1 — — 3
CA — 1 3 1 — — 3
TA — 4 1 — 4 — 1
N — 12 18 5 8 1 16
% — 40 60 16.7 26.7 3.3 53.3

The role of organisations like IMF and EU should not be forgotten when considering external interventions or
pressures. The IMF and the World Bank in particular may want to influence the agencies’ internal organisation.
Related legislation can be changed to bring it in line with the requirements of these international organisations.
Their requests are conveyed to IRAs through other public institutions that are the official counterparts (such as the
Treasury). However, the ‘passionate’ relations between Turkey and these international organisations and the
readiness to carry out their requests without discussion encourages both the politicians and the bureaucracy to try to
impose their own ideas. Hence, any potential resistance that may arise is overcome by claiming that the requirement
is an IMF’s or EU’s requisite (interview with chairman C).
Nevertheless it is notable that IRAs’ members do not see these international/supranational organisations as
sources of interventions. The reason could be the fact that these demands are not direct but conveyed through the
government. However, one should not forget the capital role these international organisations have played in the
establishment of most of them. Board members could therefore regard the interventions of these international
organisations as natural. Another reason is the members’ consideration of international organisations as a buffer
against political pressures over IRAs. In other words members see IMF, World Bank and the EU on their side
against governments.11
The fact that there are interventions does not always mean that decisions are taken in accordance with such
interventions. What is important is the extent to which the IRAs can resist the intervention. Unfortunately, the
majority of the interviewees (53.3%) have not expressed an opinion on the matter. Only 26.7% of them think that
IRAs show resistance to the interventions ‘sometimes’ and 16.7% ‘all the time’. Though the ratio of people who
have not answered is high and the validity of interpretation is therefore a little risky, one can state that there are some
failures in resisting interventions. Indeed, 30% of members state that the board, ‘sometimes’ or ‘rarely’ could not
resist pressures. In the Telecommunications Board the resistance level against interventions is the lowest.
How do members explain the insufficient level of resistance? The following elements are given as the causal
factors: indebtedness felt by some members vis-a-vis the politicians who appoint them to IRAs; politician’s tutelage
over the IRAs; disregarding the democratic decision-making processes and setting other priorities. Another
explanation could be that decisions based on discretionary powers are more prone to external interventions.

Do members face interventions in the decision-making process?

It seems that interventions in the decision-making process are aimed at the members personally rather than to
boards as a whole. Indeed, 60% of members say that they have received requests aiming to influence their decisions

11
Indeed a member claimed that as IRAs are backed by IMF, WB and EU, the government could not shape them as it would wish (interview with
board member C).

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 IRA IN TURKEY: ARE THEY AUTONOMOUS? 329

Table 2. Do members face interventions in the decision-making process?

Questions Are you faced with What are the sources of intervention?
intervention when
taking decisions?

Most of Some Never Representatives of Public Other members Government Other

the time times the sector bureaucracy of board

IRAs BRSA — 2 3 2 — — 1 —
RTSC — 4 4 2 1 1 —
PPA — 1 3 1 1 — — 1
CMB — 1 3 — — — — 1
TABMRA 1 2 1 2 — 2 — —
CA — 2 2 1 — — — 1
TA — 5 — 5 — — — 1
N 1 17 12 15 3 3 2 4
% 3.3 56.7 40 55.5 11.1 11.1 7.4 14.8

in a certain way either ‘most of time’ or ‘sometimes’ (Table 2). On the other hand, as mentioned above, according to
60% of members, the board as a whole never faces external intervention at any time. This may be considered quite
normal because it is more difficult to reach the board as a whole, instead of individual members.
When we look at the sources of requests forwarded to members we see that members are mostly put under
pressure by the related sector’s representatives (55.5% of members’ opinion). Requests coming from the
government are rather low (7.4%). But the ratio of requests conveyed from the public bureaucracy and other
members of the board (22%) cannot be underestimated. The low frequency of governmental request can be
explained by the fact that politicians see the chairmen of the IRAs as their interlocutors.
As is the case at board level, the Telecommunications Agency and RTSC are the agencies most affected by
interventions at member level. For both, requests emerge mostly from the related sector. However, requests over
RTSC members stem from various sources. PPA and CMB are the least affected agencies.

Do members feel themselves secure regarding their position?

Officially a board member can only be removed in instances specified by the legislation. But as mentioned before,
in practice, there have been exceptions to this rule. In the light of these apparent problems related to job tenure
security, members were asked whether they thought that they could be obliged to resign or whether they could be
dismissed before the end of their terms of office. 69% of the members thought that their tenure is assured and that
they would never be dismissed. However, 32% of members ‘sometimes’ or ‘frequently’ thought that they could be
dismissed. So, the job tenure established by the legislation is not felt as an effective protection by all members.

Preparation to board meetings and deliberation methods

Except for the Sugar Agency, in all IRAs in Turkey board membership is a full-time work and the members are
forbidden to take on another job. Members’ ability to protect their personnel autonomy and their effective
participation in the decision-making process depends fundamentally on their level of expertise and their knowledge
of the debated issues. Besides, frequency of meetings and workload are important. And consequently the members
need to find sufficient preparation time. Boards generally have meetings at least once a week. Because of a busy
agenda or the necessity to assess certain subjects with a deadline, some boards hold meetings twice or thrice a
week. The agenda is prepared by the board chairman and communicated to the members 24 hours prior to meeting.

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For deliberations on technical decisions and decisions that cause interventions, it is essential for members to have
an extensive knowledge of the issue and a substantial preparation before the deliberation. Otherwise the risk for the
members to vote following the opinion expressed by the chairman or some other member arises.
In this context members were asked two questions. The first was whether they are able to make sufficient
preparation for the agenda items prior to the meeting. The second question was about the discussion methods.
Almost all members (96.6%) affirm that they make sufficient preparation ‘always’ or ‘most of the time’.
The way the meetings are managed and their democratic quality are also indicators of autonomy. It is important
in this context that decisions are taken following a freely conducted discussion, where members express their
position without any constraint. On that point 89.7% of members declare that decisions have been taken ‘always’
and ‘most of the time’ after sufficient and free discussion.
The majority of members who believe that decisions are made without sufficient discussion cite the high number
of items on the agenda as the reason. A loaded agenda is principally a problem for IRAs established after 2000
which were still not fully institutionalised. In some IRAs the agenda comprises 70–80 or even 150 items, even
though they meet at least once or thrice a week. Though some of these items consist of routine issues, they still take
a lot of time. Besides, for some IRAs, the agenda is also overloaded by having to deal with complaints requiring
immediate attention. For example, a complaint mechanism that did not exist previously in the public procurement
process is now considerably engaging PPA. There have been 20,000 complaint applications to this IRA in the first
seven months of 2005 (interview with board member A) and the number of decisions on conflict they have taken
exceeds 4000 until the end of 2005 (http://www.kik.gov.tr/index2.htm).
Another reason for the highly loaded agenda is the obligation to finalise some applications in a fixed period of
time. For members, the time limits imposed by the legislation are the second most important reason for the rapid
and superficial discussion. Besides, members’ lack of preparation for sessions, inefficient time management, lack of
documents and incomplete files are other reasons of unproductive discussions.

CONCLUSION
Over the last 25 years, Turkey has been experiencing the pains of the transition from a development model based on
import substitution and mixed economy to the highly liberalised market economy. This transition, for which
international organisations’ expectations were also crucial, occurred with insufficient preparation and without
taking all potential impacts and outcomes into account. This is why the transition has created serious problems
while being put into the practice. The creation of IRAs is a part of the transition process.
The process of institutionalising and legitimising IRAs is not yet completed in Turkey. Discussions about the
limits of autonomy for the effective functioning of these institutions, their relations with the government, political
responsibility of their actions, and mechanisms for enhancing their accountability are still underway. Policies to
determine the main lines of institutionalisation and consent are not yet fully matured. In fact, such matters should be
settled before the bodies were established.
IRAs’ autonomy is a key issue in these deliberations. In this survey, we have analysed how these agencies see
their autonomy. De jure autonomy is not always a accurate indicator of de facto autonomy; what is important is the
way the institution actually works. As a matter of fact, de jure and de facto autonomy do not always converge. From
the point of view of IRA board members, agencies’ de jure autonomy has been satisfactorily laid down by law. But
members believe that institutional autonomy has been restricted in practice.
The main indicator of agencies’ de facto autonomy is the scope for initiative members actually have in the
decision-making process. The findings obtained cannot however be generalised to all agencies. The potentiality of
intervention appears higher at the members’ level than at the board level. At the board level, the main intervening
agents are the representatives of the regulated sectors and the political authorities. At the members’ level, the main
agents appear to be the regulated sector in the first place, and then public bureaucracy, other members of the board
and the political authority. Therefore it seems difficult to assert that members have an absolute autonomy in taking
their decisions.

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 IRA IN TURKEY: ARE THEY AUTONOMOUS? 331

These findings lead us to three general conclusions. First, there are constraints on the actual use of autonomy on
the part of IRAs. This confirms the hypothesis put forward at the beginning; that de jure autonomy and de facto
autonomy do not necessarily converge. Second, the proposition linking managerial autonomy with professionalism
and efficiency is likewise questionable on the basis of the realities reported. Third, board members are facing at a
personal level interventions deriving mostly from representatives of regulated markets. In terms of IRA autonomy,
the main concern hitherto has been focused on governmental interventions. However, as IRAs are intervening in
important conflicts of interest in the market, their independence from market forces is also crucial. Politics is
intrinsic to administration and hence it has an inherent duty to manage conflicts of interest. The challenge from a
democratic point of view is for government to keep a distance from or, minimally, to maintain a careful balance
between vested interests.

INTERVIEWS
Deputy chairman A, 14 June 2005
Chairman B, 22 June 2005
Chairman A, 27 June 2005
Deputy chairman B, 01 July 2005
Board member A, 12 July 2005
Chairman C, 25 July 2005
Board member C, 03 August 2005
Board member B, 02 September 2005

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