After consultations with Britain which did not want to take joint action under the Treaty of Guarantee, Turkey intervened as a guarantor power on 20 July 1974 in conformity with its treaty rights and obligations. The Turkish intervention blocked the way to the annexation of the island by Greece, stopped the persecution of the Turkish Cypriots and brought peace to Cyprus. The conditions became ripe for a negotiated settlement for the first time since December 1963.

In February 1975, the Turkish Cypriot people re-organized itself as a federated state in the hope that this would facilitate a federal settlement. The UN Secretary-General was entrusted with a mission of good offices by the Security Council in order to bring the two sides together and facilitate their negotiations on an equal footing. On 2 August 1975, at the third round of the Vienna talks an agreement was reached between the two sides, for the voluntary regrouping of populations. The agreement made it possible for the Turkish and Greek Cypriots to live in two geographically separate areas and under their own administrations. Following 1974, the new set of circumstances contributed to the prosperity of the island. Democracy flourished in both parts of Cyprus.

The high-level agreement of 1977 between the two sides in Cyprus set the goal as the establishment of a new partnership in the form of a bi-communal, bi-zonal federation. Under the auspices of successive UN Secretaries-General, a number of parameters such as political equality, bi-zonality, bi-communality, property exchange, the continuation of the Treaties of Guarantee and of Alliance and the tackling of EU membership after a settlement emerged as a framework for a solution. Turkey and the Turkish Cypriot side strived for a federation. They maintained that partnership and reconciliation in the island can only be achieved by safeguarding the sovereign equality of the Turkish and Greek Cypriots and the balance between two motherlands vis-a-vis Cyprus.

From 1974 onwards, in defiance of the rule of law and the established principle that federations can only be built between equal partners, the Greek Cypriot side continued with its sovereignty claims over the entire island. This prompted the Turkish Cypriot side to assert its rights by proclaiming the Turkish Republic of Northern Cyprus (TRNC) in 1983.

But the Turkish Cypriot side continued to participate in the UN process and to contribute to the efforts for the achievement of a federal settlement. On the other hand, the Greek Cypriot administration paid only lip-service to the internationally supported proposal of federation and dragged its feet in the talks that were being held under the auspices of the UN Secretary-General. The course which the Greek Cypriot side followed, namely its rejection of the 1985-86 UN Draft Framework Agreements, the 1992 UN Set of Ideas and the 1994 Confidence Building Measures, demonstrated that it was out to ignore the framework established through the UN process. Indeed, the defiance against the basic parameters for a solution clearly show that the Greek Cypriot side never foresaw a bi-zonal federal system and that it totally rejects the idea of equal partnership with the Turkish Cypriot side.