ARTICLE / MAKALE The scope of this law covers generation, transmission, distribution, wholesale, retailing and retailing services, import, export of electricity; rights and obligations of all real persons and legal entities directly involved in these activities; establishment of Energy Market Regulatory Authority and determination of operating principles of this authority; and the methods to be employed for privatization of electricity generation and distribution assets. 4.3. An Autoproducer and Autoproducer Group: An Autoproducer and Autoproducer Group shall be entitled to seli a certain percentage (not exceeding twenty percent in any case) to be determined by the Board of the electricity it has generated in a ealendar year within a competitive environment. The Board, under extraordinary circumstances, can increase this percentage by half of the original ratio. in case the amount of the electricity sold in a calendar year exceeds the percentage set by the Board, the autoproducer or autoproducer group shall be obligated to obtain a generation license. The procedures and principles regarding the activities of autoproducers and autoproducer groups, the nature of their sales to their affiliates and sales of the electricity generation surpluses shall be governed by the regulations to be issued. 4.4. Legal entities to be engaged in Transmission Activities: The Turkish Electricity Transmission Co. ine shall conduct the eleetricity transmission activities. Turkish Electricity Transmission Co. ine. shall be responsible for taking over all transmission facilities owned by the public, developing transmission investment plans for the proposed new transmission facilities and building and operating new transmission facilities. Turkish Electricity Transmission Co. ine. shall also prepare, revise and inspect the transmission, connection and use of system tariffs that are subject to the Board approval and shall perform load dispatch and frequency control, carry out substitution and capacity expansion activities in the transmission system, monitor real time system reliability, purchase and provide ancillary services under the provisions of ancillary services agreements. 4.5. Legal entities to be engaged in distribution activities: The electricity distribution activities shall be performed by distribution companies in areas indicated in their respective licenses. Distribution companies owning and/or operating distribution facilities in the areas specified in their licenses shall carry out renewal, replacement and capacity expansion investments for these facilities and provide non-discriminatory electricity distribution and connection services to all system users including eligible consumers connected and/or to be eonnected to the distribution system within a period of time to be specified by regulations in accordance with the terms and provisions of their distribution licenses and the distribution code. 4.6. Generation License: Generation lieense shall mean the license to be obtained from the Authority by generation companies for existing or future generation facilities, in order to be engaged in generation of electricity and sale of electricity generated. The procedures and principles on obtaining a generation license is shall be specified in regulations to be issued. Excluding the autoproducers and autoproducer groups, real persons or legal entities, those generale electricity only to meet their own requirements in accordance with the regulations to be issued and do not operate in parallel to the transmission and distribution systems, shall not be subject to licensing. 4.7. Distribution License The distribution license shall mean the license to be obtained from the Authority by all legal entities in order to engage in distribution activities in a specified region. in addition to distribution and retail sale activities, private sector distribution companies shall be entitled to construct generation facilities in the region specified in their lieenses provided that they obtain a generation license and that the amount of the annual electricity generated by them do not exceed 20 percent of the total amount of electricity offered for consumption in the relevant region within the previous year. 4.8. Energy Market Regulatory Authority An independent, administratively and financially autonomous public institution, namely the Energy Market Regulatory Authority, is hereby established to perform the duties assigned to it by this law. The Authority shall be responsible for issuing Board-approved licenses that set forth the activities to which the legal entities shall be entitled and the rights and obligations arising from such activities; regulation of existing contracts within the scope of transfer of operating rights as per the provisions of this Law; monitoring market performance; drafting, amending, enforcing and auditing the performance standards and distribution and eustomer services codes; setting out the pricing principles indicated in this Law; setting out the pricing principles to be employed for electricity sale to non-eligible consumers with regard to the market conditions; enforcing and auditing the formulae regarding the modification of such prices due to inflation; and ensuring the conformity of the market behaviour with the provisions of this Law. 4.9. Natura! gas market law The Natural Gas Market Law (No. 4646) was enacted in April 2001. in Turkey the Authority of the engineering, construction and operations of oil and natural gas network was given to BOTAS by the law. BOTAS is a state owned corporation. AII gas purchasing contracts with suppliers (Russia, Algeria, ıran, Azerbaijan) have been signed, by BOTAS. These are the contracts with "take or pay" obligation. BOTAS has almost eompleted the Country's gas transmission network. At 2001, Free Gas Market Law No: 4646 is enacted by Turkish Parliament. According to subject law; BOTAS has to hand over the gas purchasing contraets to private gas importers until year 2009. Thus, the market share of BOTAS will be reduced down to 20%. Nowadays, international tender is announeed by BOTAS to hand over 80% of existing eontracts. -58 -+-tE:::N .::_ E :::_ R:::.J:.:: I &:_::K:::OJ:::,: EN:.:::ERA=SY,:::ON :..:: O :.:::ÜN .:..::YA ::::S:... 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