THE EUROPEAN Commission will warn Turkey today that its record €1.7 billion tax demand levied against the country’s biggest media group, Dogan Yayin, threatens freedom of the press and could damage its bid to join the EU.
It will also call for urgent action from Turkey to open its ports to Cypriot vessels in its annual progress report on Ankara’s path towards EU accession.
“The high fines imposed by the revenue authority potentially undermine the economic viability of the group and therefore affect freedom of the press in practice,” says a draft of the progress report, which stops short of recommending specific sanctions for its EU membership talks. “There is a need to uphold the principles of proportionality and of fairness in these tax-related procedures.”
The Turkish finance ministry tax authority issued the €1.7 billion fine last month for alleged tax evasion at Dogan Yayin, which owns a stable of newspapers, magazines, TV and radio stations and internet firms.
However, Dogan Yayin has accused the authorities of targeting it because of the group’s critical coverage of prime minister Tayyip Erdogan’s government.
The row escalated yesterday when the Turkish tax authority rejected the collateral provided by Dogan Yayin to fight the record tax fine. A company spokesman said yesterday the tax authority had, as a consequence, placed a preliminary injunction on the sale of shares in three of Dogan Yayin’s units.
Turkish government sources said the move could enable the government to seize Dogan Yayin’s assets, although the media group has the right to appeal the rejection of the collateral.
Such a move by the Turkish authorities is not unprecedented.
In 2007 the ATV-Sabah media group was seized for irregularities and sold for $1.1 billion (€742 million. However, the tax authorities pursuit of Dogan Yayin is prompting real concerns within the EU about Turkey’s commitment to a free press and a fair taxation system.
The case has also drawn parallels with Russia’s treatment of the oil giant Yukos, which was crippled by a huge tax bill and subsequently sold off.
Mr Erdogan insists the tax fine is part of a routine investigation and has described comparisons with Russia as “disrespectful” to both himself and Vladimir Putin.
However, relations between Mr Erdogan and Aydin Dogan, the billionaire owner of the media group and a mainstay of Turkey’s secular-minded establishment, have been tense since the former came to power in 2002.
One of the criteria assessed by the commission when considering Turkey’s suitability to join the EU is freedom of the press. Its latest progress report highlights the case of Dogan Yayin and pinpoints problems with freedom of expression in Turkey.
The Turkish legal framework still fails to provide sufficient guarantees for exercising freedom of expression and, as a result, is often interpreted in a restrictive way by public prosecutors and judges, it says.
The report also calls on Turkey to take urgent action to open its ports to Cypriot vessels.