Doing Business in Azerbaijan 2009 - Azerbaijan Export ...

DOING BUSINESS IN 

AZERBAIJAN 2009 

Azerbaijan Export and Investment 

Promotion Foundation

Important notice: This 

information is provided for 

general guidance only. 

Specific legal advice 

should be sought prior to 

taking any action in 

respect of the matters 

discussed herein. Every 

possible effort has been 

made to ensure that the 

information contained in 

this book is accurate at the 

time of going to press.

“During recent five years, the economy of Azerbaijan increased at 

2.6 times, as well as the budget expenditures grew by more than 10 times, 

while the level of the poverty decreased from 49% down to 13%, with 

practically eliminated unemployment rate. During ten months of the 2009 

the Azerbaijan’s GDP growth made 8.3%, while industrial growth was about 

7.4%. This speaks about sustainable character of our economy. In spite of 

the global economic crisis Azerbaijan’s economic development continues to 

and is being successfully carried out.” 

—Ilham Aliyev 

President of the Republic of Azerbaijan

COUNTRY INFORMATION 11 

Azerbaijan: State, geography and history in brief 12 

Snapshot of the Azerbaijani Economy 21 

BUSINESS CLIMATE 29 

Business conduct framework and FDI regime 30 

Company Incorporation 35 

Acquisition & ownership of land and property 42 

Obtaining licenses 44 

Hiring & Firing 46 

Foreign trade regulation 50 

Currency regulation & repatriation of profit 53 

Taxes 56 

Accounting 59 

Intellectual property 62 

Dispute resolution & arbitration 65 

Privatization 70 

SECTORS REVIEW 79 

Oil & Gas (With Regulatory Framework) 80 

Minerals & mining 87 

Energy 87 

Agriculture 93 

Food and Beverages 95 

Telecoms & IT 99 

Construction 103 

Textile & cotton 106 

Transport & logistics 107 

Tourism & Hotel Management 110 

Financial sector: banks, insurance & leasing 111 

Development parameters of the banking system 112 

Capital market 118

OVERVIEW OF THE REGIONS 127 

Absheron economic region 128 

Aran economic region 129 

Daglig Shirvan economic region 130 

Ganja-Gazakh economic region 131 

Guba-Khachmaz economic region 132 

Lankaran economic region 132 

Nakhchivan economic district 133 

Sheki-Zagatala economic region 134 

Yukhari Garabag and Kelbajar-Lachin economic regions 135 

GENERAL INFORMATION 141 

Living & Working in Azerbaijan 142 

Labour market 147 

Visas & Work Permits 147 

Business etiquette 150 

Useful hints 162 

USEFUL CONTACTS 169 

Ministries, State Committees and Agencies 170 

Embassies of the Republic of Azerbaijan abroad 174 

Hotels 181 

Hire and rental of cars 182 

Notary offices 182 

Consultant services 183 

Emergency phone numbers 183 

ANNEXES 187 

MAP OF AZERBAIJAN 

2009 


AZERBAIJAN 

9 

CONTENTS



AZERBAIJAN 

11 

COUNTRY 

INFORMATION

12 DOING BUSINESS IN AZERBAIJAN 

Coat of arms 

Flag 

Establishment: 

28 May 1918 

Independence: 

18 October 1991 

(II republic) 

Capital: Baku 

Language: Azerbaijani 

Currency: Azerbaijani 

Manat (0,8 AZN=1 USD) 

Azerbaijan: State, geography and history in brief 

Territory: 86.6 ths square km, (11.5% forests, 1.6% water surface, 

50% agricultural lands, of which 27% pastures, 36.9% other lands). 

The territory also includes Azerbaijani sector of the Caspian Sea. 

The country is situated between 44° and 52° of east longitude, 38° 

and 42° of north latitude, Baku is located in 40° parallel. 

Climate: Azerbaijan’s climate varies from an arid subtropical and 

humid subtropical to a mountainous tundra climate. Average annual 

precipitation is between 200 and 300 mm (8 to 12 inches) in the 

lowlands and 300 to 900 mm (12 to 35.5 inches) in the highlands, 

although precipitation is distributed unevenly throughout the year. 

On the southern slopes of the Greater Caucasus average annual 

precipitation ranges between 1,000 and 1,300 mm (39 to 51 inches). 

Average temperature ranges in the lowlands between 25 and 27 

degrees C (77 and 80 F) in July and 0 to 3 degrees C (32 to 37 

degrees F) in January and between minus 3 to minus 6 degrees C 

(27 to 21 degrees F) in January in the highlands. 

Neighbors: Borders with Iran in the south–765 km and Turkey in 

the south-west–15 km, Russia in the north–390 km, Georgia in the 

north-west–480 km, Armenia in the west–1,007 km. The widest 

part of the Azerbaijan section of the Caspian Sea is 456 km. 

The country is well placed on the south eastern border of Europe 

on the shores of the Caspian Sea enriched with hydrocarbon 

resources. It has direct access to the extensive and speedily 

emerging markets of the Central Asian states, Caucasus as well as 

Middle East. Azerbaijan declared the policy of openness for 

international business. It has an excellent record of cooperation 

with private international businesses, in particular, with oil & gas 

corporations.

The country by now is well integrated in the international 

cooperation system through participation in various international 

organizations such as Council of Europe, OSCE, Commonwealth of 

Independent States, GUAM (Georgia, Ukraine, Azerbaijan and 

Moldova alliance), Black Sea Economic Cooperation, Organization 

of Islamic Conference as well as a system of multilateral and 

bilateral treaties on security and economic affairs. Azerbaijan has 

stakes and is actively engaged with the European Bank for 

Reconstruction and Development, Asian Development Bank, World 

Bank, International Monetary Fund, Islamic Development Bank, 

Black Sea Trade & Development Bank etc. all of which have running 

projects portfolios in the country. 

Political system 

Azerbaijan has a republican form of government. The three 

branches of power include: 

• executive headed by the president (5 year term); 

• legislative: unicameral national assembly (milli majlis) with 125 

deputies (5 year term); 

• judiciary headed by the supreme court of the republic. 

The system of “checks and balances” includes the Constitutional 

Court and the Constitution with a number of guaranteed rights and 

freedoms for the people of Azerbaijan. The country lives a very 

dynamic political life. A number of parties and politicians compete 

for the presidency, parliamentary constituencies and municipalities. 

A well developed electronic and print media community 

complements public political discourse. 

The foreign policy of Azerbaijan is geared towards the 

establishment of peaceful and mutually beneficial cooperation with 

all international partners. One of the major foreign priorities of the 

republic is integration into the common European space. Relations 

COUNTRY INFORMATION 

13


with CIS countries are also important, primarily because of 

the vitality of the existing and traditional economic cooperation 

and relations. 

Demography and people. 

The population is evenly distributed between urban and rural 

areas, with 53.9% residing in towns and cities. Some 38% of the 

estimated three million workforce are engaged in agriculture and 

related activities, with 13% working in industry and construction. 

Azerbaijan is a positive model of peaceful co-existence of religious 

communities. Although predominantly Muslim, the country traditionally 

served as a safe haven for various ethnic groups, religions, 

and cultural traditions. Large communities of Christians and Jews 

traditionally live here. Secularism and non-involvement of the State 

in religious affairs is a strong local tradition entrenched by law and 

supported by a liberal and inclusive culture. 

The country is the largest and the fastest growing economy in the 

South Caucasus. Azerbaijan provides the best transport links, 

connecting South Eastern Europe with the vast regions of growing 

importance such as Central Asia and the Caspian Sea. An increasing 

number of professional shipping companies are engaged in the 

transportation of goods via these transport corridors during the 

past decade. There are extensive opportunities for tourism development 

due to the unique terrain and geography. 

Azerbaijan has a number of major natural attractions such as warm 

sea, mountainous resorts, mineral springs and medicinal mud 

recreation centres. The historical background of the country on the 

crossroads where civilizations met for many centuries makes it 

even more attractive as a place to visit and do business.

Administrative division 

Population, per year 2007 2008 

Thousands person 8,665 8,779 

Urban 53.5% 53.9% 

Rural 46.5% 46.1% 

Population density, per km2 100.0 101.3 

Population in numbers 

Autonomous Republic 1 (Nakhchivan AR) 

Districts 66 

Towns 77 


Districts of cities 13 

Settlements 258 

Rural territorial division 1700 

Rural settlements 4253 

Capital city Baku (2.1 million) 

15


Azerbaijan is one of the 

world’s oldest cradles of 

civilization. Human 

cultural activities in 

Azerbaijan were 

discovered in Gobustan 

(about 70 km from the 

capital city Baku) providing 

indisputable proof that the 

Azerbaijani culture goes 

back to approximately the 

12th millennium B.C. 

History 

One of the countries of the South Caucasus, Azerbaijan was reintroduced 

on the political map of the world after the collapse of 

the Soviet block. Independence was regained only in 1991 at the 

price of thousands of lives of Azerbaijanis lost in the Nagorno- 

Karabakh conflict and the Soviet attack against Azerbaijani national 

movement in Baku in January 1990. Yet despite a short period of 

independence in the new era, Azerbaijan has an enduring and rich 

history of statehood and culture. 

Today’s Republic of Azerbaijan is the successor of the Azerbaijan 

Democratic Republic (ADR) declared on 28th May 1918 by the first 

Azerbaijani parliament—National Assembly (Milli Majlis). Though 

short lived (was occupied by Bolshevik Russia in 1920), ADR was 

the very first democratic government in the whole Islamic world. 

Such measures as electoral rights for women, representation of 

ethnic minorities in Parliament, and other progressive initiatives 

were put in place. These initiatives were ahead of their time, not 

only in the Middle East and Eurasia, but in the old democracies of 

Europe as well. 

The location of Azerbaijan as the most convenient route for 

migration from Asia to Europe, and from Eurasia to Middle East, 

from ancient times until recently forms the country’s ethnic mix 

of today. It is a mix of Turkic, Caucasian, European and other 

cultural influences. 

According to conventional historical tradition, the word “Azerbaijan” 

descends from the personal name or official title of the local 

ruler Atropat, IV century B.C., a contemporary of Alexander the 

Great. Other historians refer to Turkic and Sanskrit languages to 

trace down the origins of the name of the country.

Anyhow, the country bore the name “Atropatan” and later “Aderbagan” 

for many centuries to come. The name was used to describe 

territories that include the present Republic of Azerbaijan and the 

province of the same name within the Islamic Republic of Iran. 

The first recorded states on the territory that is now known as 

Azerbaijan date back to 9th Century B.C. A few states such as 

Manna, Maday and Albania with their own unique traditions 

succeeded one another in the period to follow. 

In the 4th century A.C. Christianity spread to the northern part of 

the country while the South remained largely Zoroastrian. In the 

8th Century the Arabic conquest of Azerbaijan commenced. The 

Khalifat had long competed with the Turkic Khazar Kaganat 

(Judaism was the official religious tradition there) for domination 

over the north. Eventually Arabs prevailed and Azerbaijan remained 

under Islamic rule for circa three hundred years with the short 

period of twenty years when a large scale Hurammi freedom 

movement led by popular leader Babek overthrew the Arabs in 

Azerbaijan and parts of Iran. 

From the period of Arabian conquest onwards, Azerbaijan became 

an integral part of the Islamic cultural tradition. Nizami, Nasimi, 

Tusi and other Azerbaijani poets and scholars now regarded the 

patriarchs of this civilization, contributed extensively to the Islamic 

Renaissance of the 9th to the 13th century. 

The Middle Ages was a period of several large regional empires, 

predominantly Turkic. Some of the mightiest dynasties were of 

Azerbaijani origin, including the Karakoyunlu, Agkoyunlu and 

Safavids. Despite the dominance of large states on the regional 

political arena, northern Azerbaijan (Shirvan) managed to sustain 

independent or at least semi-independent status throughout the 


Shah Ismail I (Khatai), the 

founder of Safavid Dynasty 

pictured at battle against 

Abu al-Khayr Khan in a 

scene from the Tarikh-i 

Alam-Aray-i. 

17


Nobel Brothers’ oil wells at the 

end of 19 th century, in Balakhani, 

a suburb of Baku. 

whole period, including the hectic times of the Mongolian invasion 

and the Teymurids. 

By the XVIII century, the country consisted of a few independent 

Khanliqs (principalities). The new regional power, the Russian 

Empire, eventually conquered Northern Azerbaijan and after the 

1828 Turkmanchay Peace Treaty with Persia the country was 

divided and southern Azerbaijan was left under Persian 

sovereignty. The Turkmanchay division is the current state of 

affairs between Azerbaijan and Iran. 

The late XIX - early XX centuries denotes the period of cultural and 

economic regeneration of Azerbaijan. In the 1860’s the industrial 

exploitation of the Azerbaijani oil fields commenced, which 

witnessed the emergence of international businesses including 

Nobel brothers, Rothschild, Siemens and others. Quite a few of 

them made their start in Baku from a small engineering company to 

a giant transnational corporation of today. 

The economic rise led to a cultural revival. The traditional Islamic & 

oriental cultural stratum was enriched by the ever growing 

European and Russian influence. The XIX and XX centuries are the 

period of major advancement in Azerbaijani social life. The first 

opera in the Muslim world, newspapers and national drama 

theatre, discussion on the adoption of a “modern” Latin alphabet, 

the first university, a school for Muslim girls and such like were the 

cornerstones of this cultural and social development. 

After the short lived Azerbaijani Democratic Republic (mentioned 

above) the 11th Soviet Red Army occupied Azerbaijan in late April 

1920. The occupation did not occur without resistance. The 

remnants of the ADR National Army units, together with the local 

militia, retreated to the second largest city of Azerbaijan, Ganja,

where a major clash with joint Bolshevik; Armenian Dashnak forces 

took place. A period of mass repression of the Azerbaijani 

intelligentsia, elite and national leaders from 1920 to 1930 followed 

the defeat of the 1st independent Azerbaijani Democratic Republic. 

Thus until 1990, the Azerbaijani Soviet Socialist Republic (AzSSR) 

was an integral part of the USSR as one of the “founding” republics 

of the Union and a major industrial and cultural centre of the 

Empire. The collapse of the Soviet bloc brought independence 

along with a serious economic and political crisis. 

The consequences of the disintegration of the Soviet Union were 

complicated by the ongoing aggression by the Republic of Armenia. 

Armenian nationalists backed by the late Soviet administration 

launched a separatist movement in Western Azerbaijan (Nagorno- 

Karabakh). A long lasting and bloody military conflict started in 

1988. The conflict was further complicated by civil confrontation 

within Azerbaijan. A few political groups were competing for power 

in the country. A succession of weak, largely incapable 

governments ended in 1993 when veteran politician and popular 

leader Heydar Aliyev was elected President. A decade of 

rehabilitation and growth started. 

In 1994 major oil & gas contracts with the consortia of oil giants 

such as BP, Amoco, Total and others were concluded. From circa 

1997 onwards, major political reforms aimed at bringing Azerbaijan 

to international standards in the areas of the rule of law, 

democracy, human rights and freedoms started as well. 

The era of Heydar Aliyev ended in December 2003 with the 

decease of the national leader. However, the policy decisions taken 

by him, including integration into European common space, 

democratization, the creation of a liberal market economy and 


Under the leadership of 

Heydar Aliyev, the 

government re- 

established peace and 

stability in the country, 

reinforced state 

infrastructure and civil 

rule throughout the 

country, and launched a 

proactive foreign policy 

campaign aimed at the 

political integration of 

Azerbaijan 

internationally. 

19

Heydar Aliyev, President of the Republic of Azerbaijan, 

in office June 24, 1993–October 31, 2003

socially oriented policies remain the undisputed development 

vectors for the current government. His far-seeing policy is being 

successfully continued by his successor Ilham Aliyev who was 

elected President for two consecutive terms in 2003 and 2008. 

Snapshot of the Azerbaijani Economy 

Azerbaijan is the fastest growing economy worldwide. Following 

sharp decline in early 90’s of the last century Azerbaijan achieved 

stable and rapid growth for 12 consecutive years starting from 

1996. Now the country is one of the most rapidly recovering 

economies in the world. The GDP annual growth in 2008 was 

10.8%. Despite world economic crisis GDP indicator continued to 

grow in 2009. Nominal wages grew by 24.1% in the year 2008. 

Almost all other major economic indicators point out a similar 

growth pattern. 

Baku is the centre of Azerbaijani economy and the home for most 

of Azerbaijan’s 3,500 industrial enterprises, petroleum extraction 

and refining, metallurgy, aluminium processing, petrochemicals, 

chemical production are located in the city and its satellites. 

Consumer goods production consists of food processing, textiles, 

and wine production. Baku is also strong in services including 

banks, hotels & restaurants and logistics. Sumgayit production is 

concentrated on chemical and petrochemical production, textiles, 

and aluminium smelting. Ganja is the home to an aluminium 

refinery and also specializes in textiles, machine building and 

metallurgy. The effect of the early 1990’s economic decline is 

evident in agriculture—a critically important sector in Azerbaijan, 

employing about 38% of the labour force. Grain is Azerbaijan’s 

leading crop, together with grape (for wine production), fruits, 

vegetables, and tobacco. 


“Great Britain and 

Azerbaijan have successful 

cooperation in various 

fields, including energy. 

Azerbaijan-European Union 

relations are successfully 

developing. We have great 

potential to further expand 

political and economic 

relations.” 

—Gordon Brown, Prime 

Minister of the United 

Kingdom 

21


“Azerbaijan not only plays a 

key role for Switzerland 

and Europe as a stable 

partner at the crossroads 

between East and West, it 

is also a member of the 

voting group for the 

Bretton Woods institutions 

chaired by Switzerland, 

which is of lasting 

importance to multilateral 

cooperation.” 

—Hans-Rudolf Merz, 

Federal President of 

Switzerland 

The country is the regional leader not only in the overall economic 

growth, but also was a leader in foreign direct investment 

attraction as well. The 2005 UNCTAD Trade & Investment 

publication quoted Azerbaijan as the No 1 globally as per the FDI 

Inflow Performance Index. Azerbaijan is also in top 20 in equity 

capital attraction in absolute terms. 

Since opening of the oil & gas industry for international business in 

1994 a number of international contracts for the oil and gas fields 

were signed with the principal oil businesses such as BP, Statoil, 

Total, Exxon, Itochu, Lukoil and others. 

The “jewel in the crown” of the economy is the Baku-Tbilisi-Ceyhan 

oil pipeline connecting the Caspian offshore fields with the 

Mediterranean Turkish port. It is taking crude oil from the ACG 

(Azeri, Chirag, Guneshli) project led by British Petroleum. The 

pipeline is ready and being filled with crude oil to be sold at the 

Turkish port of Jeyhan. The transport capacity of the pipe is over 1 

million barrel a day. 

The Azerbaijani government is committed to constructing a network 

of oil & gas pipelines throughout the region to promote 

international cooperation and trade. The oil & gas projects have 

been bringing substantial cash inflow into the country since 2006. 

Notwithstanding these apparently bright prospects, the government 

of the country took a number of steps aimed at the reduction 

of the country’s dependency on the oil revenues and evasion of the 

so-called “Dutch disease”. 

The State Oil Fund, a transparent state agency under public 

scrutiny is accumulating the oil revenues from the international 

contracts. The regional development and non-oil economy 

development strategies aimed at the diversification of the 

economy are also prioritized.

The main source countries of FDI for Azerbaijan are currently the 

United States, UK and Turkey. The cumulative FDI in the year 2008 

amounted for approximately 4000 mln USD. Foreign direct 

investments outside the oil & gas sector currently are mainly in 

construction, services, transport, telecoms and manufacturing. 

Azerbaijan is consistently expanding its international trade 

capacities as well (see chart). This was achieved mainly due to two 

factors: export of ever increasing amounts of Azerbaijani crude and 

oil products and the expanding internal market which resulted in 

rise in import of manufacturing equipment and consumer goods in 

the country. At the moment, the EU is the main export destination 

for Azerbaijan, with Russia, Turkey and some EU countries 

remaining the main source of import. 

The country’s domestic product is largely contributed by private 

business. Its share constituted 84.5% of GDP in 2008. This is the 

result of several stages of privatization of the formerly state owned 

property and development of new privately owned industries. 

However, a number of key segments of the economy are still state 

controlled. Many of them are now “open for privatization” by the 

Presidential Decrees which creates additional investment 

opportunities. The government uses several methods of 

privatization with the most popular being the acquisition by a 

“strategic investor” or via “investment tender”. 

Azerbaijan has one of the lowest external debt; GDP ratios in the 

region and a sound financial system. The fiscal system is further 

characterized by a very low deficit of state budget not exceeding 

1% of GDP in 2008. 


“We consider that 

relationships between our 

countries are at high level, 

and there are good 

prospects for development 

in future. Hungarian 

companies are keen on 

investing in the agrarian 

sector of Azerbaijan. 

As a member of EU, 

Hungary wants to share its 

experience with Azerbaijan 

in the field of integration 

within the framework of 

the European Union`s New 

Neighbourhood Policy. We 

support ongoing reforms 

to establish the rule of law 

and democracy in 

Azerbaijan.” 

—Laszlo Solyom, 

President of Hungary 

23


For more information on 

current trends in the 

Azerbaijani economy 

please refer to the website 

of the Ministry of 

Economic Development at 

www.economy.gov.az and 

the AZPROMO resource 

www.azpromo.org 

GDP in Azerbaijan 1996-2008 

Azerbaijani Foreign Trade 

Private share in GDP 

mln. USD 

mln. USD 

%

Some useful macroeconomic indicators (2008) 

GDP 38.0 billion AZN 

Annual growth 10.8% 

GDP per capita 4,439 AZN 

Annual growth 75.4% 

Inflation 20.8% 

Investments 13.3 12.4 billion 

Annual growth 27.8 20.5% 

Domestic investments 48.1% 

Foreign investments 8.2% 

Weighted exchange rate for 1 USD 0.82 AZN 

Share in GDP by sectors (2008) 

Industry 57.4% 


Agriculture 5.8% 

Construction 7.6% 

Transport 5.1% 

Communication 1.9% 

Wholesale and retail 6.0% 

Social services 9.1% 

Taxes 7.1% 

25

26 DOING BUSINESS IN AZERBAIJAN

27 

The Government House at Freedom square, 

Baku, Azerbaijan.



AZERBAIJAN 

29 

BUSINESS 

CLIMATE


Business conduct framework and FDI regime 

The Republic of Azerbaijan is the leading FDI destination in the 

region. In the last decade the total FDI stock in Azer baijan 

exceeded 30 billion USD. Azerbaijan has achieved gradual 

improvement in the overall legal framework for the investment 

activities in the country for last several years with a number of 

practical regulations liberalizing conduct of business and reducing 

red tape. It carried out a revolutionary legal reform several years 

ago with adoption of new Tax code, Civil and Civil Procedure 

Codes, Land Code, Labour Code, Customs Code, Foreign Exchange 

Law as well as Law on International Arbitration made the system 

significantly more transparent and friendly for local and foreign 

businesses. 

The Government managed to open up economy for the international 

business and introduce investment-friendly laws and regulations. 

Generally, the Azerbaijani legislation establishes a very open 

national regime for FDI (which means that FDI are welcome in any 

sectors where the local investor is allowed to invest). Such a 

regime also applies to the privatization of the state owned 

property. There are no special permissions or specific registration 

requirements for foreign investment. The licensing was 

substantially simplified with foreign investors’ interests in mind. 

A foreign investor in Azerbaijan enjoys a non-discrimination regime. 

The major economic policies include an FDI element; for example, 

the Government lifted limitations for foreign participation in the 

banking sector. Privatization process is open for foreign investors 

as well. Any FDI restrictions are strictly limited to national security 

matters. The major factors that turned Azerbaijan into a leading 

FDI destination and provide sound justification for doing business 

here are:

Abundant resources 

Azerbaijan is rich in mineral and climatic resources. The Caspian 

Sea oil & gas reserves are one of the major deposits globally. 

Azerbaijan has also substantial explored deposits of precious 

metals (including gold and silver), ferrous and non-ferrous metals, 

various construction raw materials deposits etc. 

One of the major resources the country has is its natural diversity. 

Despite relatively small size, the Azerbaijani territory due to 

complex terrain and geography has a number of distinct climatic 

zones ranging from humid subtropical climate to semi-arctic. This 

creates unique opportunities in agriculture and tourism. 

Favourable location 

Azerbaijan is located on the very south-eastern border of the 

European continent and serves as the natural bridge between 

Europe and Central Asia as well as it is the most convenient route 

from the north-east of Europe to the Middle East. The country is 

the logistics hub for the Caspian region. Excellent infrastructure of 

Baku (including largest regional sea and air terminal) is the best 

choice for any business entering the markets of the Caspian Sea 

region. 

Competitive cost of production 

Azerbaijan has long lasting industrial and trade traditions. The 

industrial revolution has taken place here in the late XIX century 

due to expanding and advanced oil production and processing 

sector. Further industrial development led to growing Research and 

Development (R&D) base. A large R&D centre, Academy of Sciences 

with circa 7,000 research studies, exists in Azerbaijan in parallel 

with a number of universities and colleges. The country is rich in 

engineering skills yet the wages are still very competitive. 

BUSINESS CLIMATE 

31


Azerbaijani government’s policies in respect of utilities tariffs are 

manufacturer friendly. 

FDI friendly laws 

Azerbaijani legislation is evolving in accordance with the strategic 

goal of the Government which implements the “welcoming policy” 

for foreign businesses. 

Foreign investments are protected by certain guarantees provided 

by the government and legislation, including: 

• Guarantee against adverse changes in legislation—the general 

rule is that legislation in force at time of making an investment 

continues to apply to individual investor for subsequent 10 years, 

notwithstanding any adverse change in law; 

• Guarantee against nationalization and requisition—foreign 

investments are not subject to nationalization (except in cases of 

harm to population and state) and requisition (except in cases of 

natural disaster, epidemics, accidents, emergencies). Foreign 

investors are guaranteed immediate, adequate and effective 

compensation in case of nationalization and requisition. 

Compensation should be commensurate with the amount of the 

investment at the time of nationalization or requisition, payable 

in foreign currency and may be freely transferred abroad; 

• Guarantee of compensation of damages—foreign investors are 

entitled to compensation of damages, including lost profits, 

incurred as a result of unlawful acts of state authorities; 

• Guarantee of repatriation of profits—foreign investors are 

entitled to repatriate profits derived from foreign investments 

subject to payment of applicable taxes and duties. 

The new Foreign Investment Bill currently under discussion in the 

Parliament is expected to reinforce the above guarantees as well as 

to introduce new legal instruments to protect foreign businesses.

The Government will continue the policy of support to industries 

with priority given for privately-held enterprises including foreignowned 

enterprises. 

There are no general trade barriers or prohibitions for import of any 

types of goods in Azerbaijan and a minimum non trade barriers 

level for international trade exists. The country is not a member of 

WTO yet, though the Government started the accession process. 

Exported goods are not subject to any customs duties and 

restrictions. Regulations exist for the export of strategic 

commodities such as electricity, petrol, cotton and non-ferrous 

metals. 

A foreign investor is particularly welcome to enter the Azerbaijani 

market with a so called “green field project”. This is particularly 

attractive bearing in mind the regional markets and the geographic 

location of the country as the transportation hub for the Caspian 

region and Central Asia. 

The Government continues to introduce a number of initiatives 

aimed at the improvement of dialogue with the business 

community. 

Another governmental initiative is the Azerbaijani Investment 

Company JSC, a state-owned joint-stock company, established by 

the Presidential Decree of 30th March 2006 with charter capital of 

AZN 90,000,000. The main objective of the AIC is to implement 

fixed-term equity investments in the private sector and to assist 

FDI in the non oil sector in Azerbaijan. Steps aimed at simplifying 

the process of business start-ups were undertaken recently. 

Azerbaijani legislation permits of the employment of expatriate 

staff. Other substantial comparative advantages of doing business 

in Azerbaijan include such important factors as macroeconomic 


33


Apart from the standard 

methods of 

communication with 

the government via its 

ministries and 

agencies, foreign 

investors can 

effectively deliver 

messages via such 

structures as the 

Azerbaijan Export & 

Investment Promotion 

Foundation (AZPROMO) 

aimed at the promotion 

of export & investment 

mainly in the non-oil 

sector (for more 

information please refer 

to www.azpromo.org). 

Doing Business 2009: 

Celebrating reforms 

Azerbaijan No.1 

and political stability in addition to Baku’s reputation as being the 

only metropolitan capital on the Caspian Sea. Pursuant to the 1992 

Foreign Investment Law in force, foreign investment may be in any 

of the following forms: 

• Participation in enterprises and organizations established with 

legal entities and citizens of the Republic of Azerbaijan on a 

shared basis; 

• Establishment of enterprises wholly-owned by foreign investors; 

• Purchase of enterprises, property, buildings, structures, shares in 

enterprises, other shares, bonds, securities, and certain other 

property, which, under the law of the Republic of Azerbaijan, 

may be owned by foreign investors; 

• Acquisition of rights to use land and other natural resources, and 

also other property rights; and 

• Conclusion of agreements with legal entities and citizens of the 

Republic of Azerbaijan providing for other forms of foreign 

investments. 

Enterprises with foreign investment include joint ventures, 

enterprises wholly-owned by foreign investors, and representations 

(offices and branches) of foreign legal entities. 

Bilateral Investment Treaties. 

Azerbaijan has 39 bilateral treaties on the mutual protection of 

investments. Several more treaties have been negotiated during 

2007-2009 with such countries as The Kingdom of the Netherlands, 

Bosnia and Herzegovina, Czech Republic, Republic of Belarus, 

Syrian Arab Republic, Spain and others. Azerbaijan is also a party 

to a number of multilateral treaties concerning foreign investment. 

According to the Doing Business 2009 World Bank Report Azerbaijan 

has made a big jump from 97th place to 33rd out of 181 economies. 

Azerbaijan improved in 7 from 10 indicators, catapulting 64

places in the ranking, the biggest jump ever recorded by the World 

Bank. Reforms affected such areas as Starting a Business, Employing 

Workers, Registering Property, Getting Credit, Paying Taxes, 

Protecting Investors. A key component for securing the top ranking 

was Azerbaijan’s “one-stop shop” also called “single window” 

system which was introduced this year and decreased the costs 

and paperwork associated with opening up new business in the 

country. Azerbaijan is pursuing its goals to ease business conditions 

and establishing favorable environment for starting business. 

Company Incorporation 

A company may start operations in Azerbaijan from the moment of 

state registration. Currently, registration authorities for commercial 

legal entities are carried out by the Ministry of Taxes of the 

Republic of Azerbaijan. 

Without a formal registration with the Ministry of Taxes a company 

may not open a bank account, clear goods through customs, etc. 

Effective 1 January 2008 the new system of corporate registration 

is in place, which significantly simplified the registration process 

for legal entities. 


Please see Annex 1 for the 

list of bilateral treaties on 

the encouragement and 

protection of investments. 

35


The registration of legal entities is now handled through a single 

state authority (“one-stop-shop”) – the Ministry of Taxes. Upon 

submission of all required documents, within 3 business days the 

Ministry of Taxes issues an extract from the state register and a 

unique tax identification number. 

There are numerous forms in which a legal entity/company can be 

incorporated in Azerbaijan. There are no specific rules for the 

incorporation of companies by foreigners apart from the standard 

legal and translation requirements. In general, foreign businesses 

tend to open representative offices/branches or register 

(incorporate) a local company. 

The Law on State Registration of Legal Entities and State Register 

sets out the requirements of the legal registration process. 

One may start his/her own business in Azerbaijan with 100% 

foreign investment or form a joint venture with a local partner. 

There are no specific requirements for the size of share or legal 

limitations for the foreign element in a company and investment. 

With the exception of certain licensed activities described below, 

there are no additional general approvals or permissions apart from 

state registration for the start up. 

Certain but limited number of documents is required for submission 

to the Ministry of Taxes for registration purposes (for foreign 

participants; shareholders, these documents include, inter alia, 

notarized; apostilled extracts from the companies’ register, 

documents of statute and corporate governance). 

Azerbaijan has recently acceded to the Hague Convention 

Abolishing the Requirement of Legalization for Foreign Public 

Documents and legalization requirement ceased to exist in respect

of documents produced and executed abroad in the convention 

member countries. The new Law on State Registration of Legal 

Entities and State Register determined the timeframe of the entire 

process. The basic term for state registration of commercial legal 

entities is set at 3 working days. 

The state register of legal entities includes general information on a 

legal entity and its founders. Any interested party is entitled to 

request a copy of the extract from a register. The state duty for the 

registration of the banks, stock exchanges, insurance companies, 

representations and branches of foreign legal entities is 220 AZN, 

for the registration of legal entities involved in agricultural business—3 

AZN and that in respect of all other legal entities—11 AZN. 

Azerbaijani law generally recognizes the following types of 

commercial legal entities (commercial legal entities are defined as 

those operating for profit): 

• General partnership (“GP”) 

• Limited partnership (“LP”) 

• Limited liability company (“LLC”) 

• Additional liability company (“ALC”) 

• Joint-stock company (open or close JSC) 

• Cooperatives 

LLCs and joint stock companies are most popular choices of legal 

entities. Please see Annex 2 for a brief comparative analysis of 

these two types of legal entities. 

General Partnership 

A general partnership is a legal entity comprised of at least two 

individuals and/or legal entities. An individual may participate in 

the creation of a GP only it such individual is registered as an 

entrepreneur. Individuals and/or legal entities may only participate 


37


in one GP. General partners are jointly and severally liable for the 

partnership’s liabilities. To the extent that the partnership does not 

have sufficient assets to cover its obligations, the partners are then 

personally liable for such obligations. 

Limited Partnership 

A limited partnership has one or more general partners and one or 

more limited partners. General partners are personally liable for the 

partnership’s obligations. Limited partners’ liability is limited to the 

amount of their contributions. A person may only participate as a 

general partner in one LP. Similarly, a partner of a GP may not 

participate as a general partner in a LP. 

Limited Liability Company 

A limited liability company is an entity established by one or more 

individuals and/or legal entities contributing their participatory 

interests to the charter capital. An LLC having only one participant 

may not be a sole participant of another LLC or any other company. 

The participants of an LLC are normally liable only to the extent of 

their contributions. An LLC is not normally responsible for the 

obligations of its participants to third parties. 

Additional Liability Company 

An additional liability company is an entity established by one 

or more individuals and/or legal entities contributing their shares 

to the charter capital. The legal structure of an ALC is similar to 

a LLC, except that the participants in an ALC may assume liability 

for the company in excess of their contributions, as regulated by 

the charter. 

Joint Stock Companies 

A JSC is a legal entity with charter capital divided into a certain 

number of shares. JSC shareholders are liable for the obligations of

the JSC only to the extent of their shares’ par value. A single 

individual or legal entity may be the founder or the shareholder of a 

JSC. The charter capital of a JSC is divided into a fixed number of 

shares of a stated par value. A JSC has a Board of Directors 

comprising at least three individuals who are either shareholders or 

independent directors. The Supervisory Board is mandatory for 

JSCs with more than 50 shareholders. 

General Meeting of Shareholders (GMS) is the supreme body in 

JSC. Azerbaijani law sets a minimum amount of share capital 

required for the establishment of JSCs, which ranges from 2,000 

AZN for closed JSC and 4,000 AZN for open JSC. Additional 

statutory requirements exist for the establishment of banks and 

insurance companies in the form of JSC. 

Cooperative 

Cooperative, a concept close to a Building Society, is a voluntary 

union of at least five individuals and/or legal entities, for the 

purpose of satisfying needs of its members through the 

consolidation of their financial or in-kind resources. Depending on 

the purpose of their activity, cooperatives may be of different 

kinds, such as consumer or housing cooperatives. 

Non-Commercial Organisations 

An Azerbaijani non-commercial or not-for-profit organization is an 

entity created to engage in various public, social and economic 

activities, not related to the generation of profit and distribution of 

such profit to its equity holders. 

Since an Azerbaijani non-commercial organization is treated as a 

legal entity, it may own property, enter into contracts, acquire 

ownership and intellectual property rights, incur obligations in its 


39


own name, maintain an independent balance sheet, maintain 

settlement and other bank accounts, and act as a claimant and 

defendant in courts and arbitration. Azerbaijani non-commercial 

organizations are presumed to engage in non-commercial activities. 

Under the Civil Code, non-commercial organizations may be created 

in any of the following forms: public association, foundation and 

union of legal entities. Other forms permitted include federations, 

schools, universities and clubs. 

Public Associations 

A public association is a voluntary, not-for-profit organization 

created by its members to engage in activities of their mutual 

interest. Azerbaijani law authorizes both individual and corporate 

membership in public associations. A member in a public organization 

loses any ownership or other rights to property transferred to 

the public association, including their membership contributions. 

Members of the public association are not responsible for its 

obligations and, likewise, the public association is not responsible 

for the obligations of its members. 

In the event of the liquidation of a public association, any property 

remaining after liquidation is allocated for the purposes specified in 

the charter. If this is not possible, such property is remitted to the 

state budget. 

Foundations 

A foundation is a not-for-profit organization created by individuals 

and/or legal entities to engage in public, charitable, educational 

and other kinds of social activities. Since an Azerbaijani foundation 

is not subject to a minimum requirement for the number of 

founders, it may be created by one individual or legal entity. 

Moreover, they are not based on membership, i.e. the founders do 

not become its members. A foundation’s founders are not

esponsible for its obligations. Likewise, a foundation is not 

responsible for the obligations of its founders. 

Unions of Legal Entities 

A union of legal entities is created by business or non-commercial 

entities to provide for the cooperation and coordination of their 

entrepreneurial or non-commercial activities, representation, and 

the protection of their common interests. A union is not responsible 

for the obligations of its corporate members. Corporate members, 

however, are responsible for the unions’ obligations to the extent 

provided under the union’s charter. 

Subsidiaries 

A legal entity, whether or not established in Azerbaijan, may form a 

subsidiary in Azerbaijan in one of the three legal forms available for 

commercial purposes, i.e. a JSC, an LLC, or an ALC. 

A subsidiary is a separate and distinct legal entity; the parent 

enterprise may contribute property to its subsidiary but, typically, 

is not liable for the obligations of the subsidiary. 

A parent company, however, may be held liable for the obligations 

of its subsidiary in bankruptcy if such bankruptcy was caused 

through the fault of the parent company in connection with the 

execution of its instructions. 

Additionally, a parent company and its subsidiary are jointly liable 

for obligations incurred by the latter as a direct result of the 

implementation of instructions of the former, even if the former is 

not in bankruptcy. 


41


Acquisition & ownership of land and property 

A progressive land reform was implemented in Azerbaijan in the 

1990’s. The country was one of the first among the former USSR 

republics to introduce private ownership of land as well as free 

trade and transfer of titles to land and distributed the large portion 

of land to the population. A lot of formerly state owned real estate 

was also either sold or distributed to population and businesses. 

Azerbaijani law provides for the following basic rights in land: 

• Ownership 

• Lease 

• Use 

The real estate in the Azerbaijani legislation is best matching the 

term “immovable property”. Pursuant to the Law on State Register 

of Immovable Property (the “State Registration Law”), creation of 

rights in property (ownership and other rights), transfers and 

termination of rights are subject to state registration with the 

register of immovable property. 

The State Registration Law recognizes registration of the rights in 

immovable property carried out by various state authorities prior to 

the date of the law and provides for data transfer to the register 

from various state authorities engaged in registration of rights in 

immovable property in the past. 

The register in accordance to the State Registration Law will be 

available to a limited list of persons entitled to receive information 

on data maintained in the Register. As a general rule, registration 

of property rights over immovable property shall be accomplished 

within 20 days. The State Registration Law contains special provisions 

in respect of registration of certain rights in immovable 

property:

• Ownership and other property rights regarding unfinished 

construction of immovable property can be registered in 

advance. 

• Property right regarding individual apartments in unfinished 

buildings or non-residential properties and mortgages thereon 

can also be registered in advance. 

• In the event immovable property is leased or given for use for a 

period exceeding 11 months, such right shall be registered by 

either party of a lease or use agreement. 

The concept of ownership in Azerbaijan includes rights to exercise 

possession, right to use/benefit and the right to dispose of the land 

(transfer ownership or other rights in land to third parties). It 

should be noted that ownership right in land is a privilege of (I) the 

Republic of Azerbaijan, (II) municipalities, and (III) Azerbaijani 

individuals and legal entities. 

Foreigners (individuals and legal entities) and stateless individuals 

may not own land in Azerbaijan and may not be granted a purchase 

option on a lease. However, international organizations, foreign 

legal entities and foreign citizens and states may lease land in 

Azerbaijan. 

Foreigners who acquired ownership rights in land through general 

legal procedures such as enforcement of security interest, grant or 

succession shall dispose of their ownership (e.g. through a sale) 

within one year; otherwise the land shall be acquired by the state 

or relevant municipality. There is no legal limitation for ownership 

of buildings, constructions etc. by foreign individuals and legal 

subjects. 

Temporary land use right is granted for up to 99 years and may be 

extended by the parties. A perpetual land use right is granted for 


43


*Under Azerbaijani law 

license is an official record 

permitting relevant types 

of entrepreneurial 

activities to a legal person 

irrespective of its 

organizational and legal 

form, as well as to a 

natural person engaged in 

entrepreneurial activities 

without creation of a legal 

entity. 

an indefinite period. The holder of such rights is liable only for the 

land tax for the land use. 

Perpetual and temporary land use rights are granted by the state 

and municipalities only in exceptional circumstances to a limited 

number of persons listed in the Land Code. Landowners may grant 

perpetual or temporary land use rights under an agreement with 

the land user. Land use terms are defined by an agreement 

between the landowner and the land user. 

Land lease is the use of land for a definite period, for a charge. 

Leases are concluded for a period agreed by the parties. Rent 

payments for the lease of privately held land parcels are freely 

negotiable. 

Rent payments for state or municipally owned land parcels are 

determined according to market conditions, but cannot be less than 

specified statutory rents. With regard to agricultural land, 

discounts from statutory rents are available depending on market 

conditions in the agricultural sector. 

Obtaining licenses* 

A license is granted without discrimination to any entity that 

satisfies the requirements for that specific license. Thus (with 

certain exceptions), foreign investors may obtain licenses under the 

same conditions and in accordance with the same procedure as 

Azerbaijani nationals. Normally, a licensee may not transfer a 

license to another legal entity or individual. 

Licensing in Azerbaijan is regulated by the laws, presidential 

decrees and orders of the Cabinet of Ministers of the Republic of 

Azerbaijan. The Ministry of Economic Development is the

government agency entrusted to exercise overall control in the field 

of licensing and to maintain a single register of licenses. 

However, the right to issue a specific license is given to respective 

state authorities who control the licensed activity (the Ministry of 

Transportation, the Ministry of Emergency Situations, the Ministry 

of Economic Development, etc). 

Regulations on procedures for the licensing of specific types of 

activities are generally issued by the Cabinet of Ministers. An 

applicant is required to submit all documents specified in the 

regulations and pay the required fee, upon which (subject to the 

application meeting all requirements) a license is issued within 15 

days. The basic term of most licenses is five years (for production 

of alcoholic beverages and ethyl (drinking) alcohol - 3 years, for 

import - 1 year). The Azerbaijani licensing system was reformed in 

2002. The number of business activities requiring a license was 

reduced from more than 200 to 57. 

As the result of the reform, the licensing system in Azerbaijan was 

liberalized. Licensing differs from the permitting procedure related 

to special “hazardous” activities such arm trade or nuclear 

materials storage. In Azerbaijani terms this type of permits is called 

“special permit”. 

A person who wishes to obtain a license to carry out specified 

entrepreneurial activity should either create a legal entity or 

register as an individual entrepreneur, i.e. become a “sole 

proprietor”. 

In Annex 3 you may see the list of business activities requiring a 

license. No other business activities require special permits as of 

the date this publication went to press. The list of documents 


45


required for obtaining a license is exhaustive. No other documents 

may be demanded from a business to issue the license. 

Hiring & Firing 

Labour relations governing the employment of all employees in the 

Republic of Azerbaijan are regulated by the Labour Code, effective 

1 July 1999 (the “Labour Code”), together with other laws issued 

pursuant to the Labour Code. The Labour Code codified the 

legislative acts adopted in the early years of independence and 

number of lower tier normative legal acts. 

Employment relations are established by virtue of execution of a 

written employment contract, which is concluded without a fixed 

term in most cases. In limited cases (such as seasonal works, work 

under a fixed term project or assignment, agreement of employer 

and employee) employment contract can be made for a fixed term 

up to 5 years. 

Fixed-term contract will be deemed to be extended for the same 

period unless terminated by a notice within 7 days of the expiration 

of the original term of the contract. 

A contract without a fixed term can be terminated by employer only 

in cases specified in the Labour Code such as gross violation of 

labour duties by an employee, redundancies, determination by a 

competency assessment body of an employee’s qualification as 

inadequate for performance of his/her duties, change of labour 

conditions etc. 

An employer is under a duty to give a termination notice. The 

general term of such a notice is 2 months (e.g. redundancies). 

However, certain exceptions apply (e.g. in case of gross violation of

labour duties when no notice is required). An employee can 

terminate a contract at any time upon giving a 1-month notice. 

When employment is terminated by the employer due to 

redundancy, for a period of 2 months prior to termination the 

employer shall allocate to an employee a fixed number of days in a 

working week to allow an employee look for a different workplace. 

Termination of employment with certain categories of employees 

(e.g. pregnant women, women with children below 3 years of age) 

is prohibited, unless employer is being liquidated. 

In cases of termination of employment due to redundancy or 

liquidation of an enterprise employer shall pay to the employee 

severance payment, which may total to up to three months of 

employee’s average salary. 

Generally, legal entities are required to make monthly social 

insurance contributions in the amount of 22% of the salary fund of 

its employees. Legal entities are also under an obligation to 

withhold employees’ social insurance contribution in the amount of 

3% of employees’ gross salaries and transfer same on behalf of the 

employees to the State Social Protection Fund. 

Individual entrepreneurs are, generally, required to pay social 

insurance contributions in the amount of 20% of the minimum 

salary. Different rates are provided for certain regions and 

categories of individual entrepreneurs (such as auditors, private 

notaries, auditors, accountants etc.) Azerbaijani law also provides 

for obligatory medical insurance to be procured by employers. 

Compensation in Foreign Currency 

All salaries paid in Azerbaijan must be paid in manats unless there 

is a special agreement (for example, Production Sharing Agreement 


47


for development of hydrocarbon reserves) with the Government of 

Azerbaijan allowing payments in other currencies. 

Probationary Period 

A probationary period of up to 3 months is allowed in most cases 

and, if the probationary period is included in the employment 

contract, the contract may be terminated by either party upon 

giving a 3-day notice. To be enforceable, a probationary period 

must be stated in an employment contract and may not exceed 

three months. A probationary period may not be imposed on 

certain categories of staff listed in the Labour Code. 

Minimum Wage 

Employee remuneration may not be lower than the minimum 

monthly wage, currently 75 manats (approximately US$ 90). 

Work Week 

The regular work week is 40 hours, reduced for certain groups of 

people and workplaces. Overtime work is not allowed unless 

necessary for state defence, public safety, ensuring the supply of 

public utilities, and in certain other situations. The duration of 

overtime work may not exceed a certain limit established by the 

Labour Code. For each hour of overtime work, an employee 

must be compensated at a rate at least twice his or her normal 

hourly rate. 

Holidays 

There are 21 public holidays. Employees are entitled to 18 official 

public days off, 17 of which are public holidays and one is a day of 

mourning. 3 public holidays are working days. The minimum paid 

annual leave is 21 calendar days, more for certain groups of employees 

and in certain workplaces.

Overtime and work during days-off (which are Saturdays, Sundays, 

public holidays and a mourning day) are compensated in the 

manner provided for in law. 

Sick Leave 

Except for the first 14 days of any absence, compensation for 

sick leave is provided by the State Social Protection Fund, not 

the employer. 

Maternity Leave 

Women are entitled to be paid maternity leave for 70 calendar days 

prior to and 56 days (70 or 110 days in certain cases) after the birth 

of a child. Maternity pay is provided by the State Social Protection 

Fund. 

Dismissal 

Grounds for dismissal include, among other things: staff redundancy; 

employee’s failure to meet required competency standards 

as determined by the decision of a competency assessment body; 

liquidation of an enterprise; and violation of employment duties as 

determined by the employment contract or labour law. There are 

statutory restrictions relating to the dismissal of certain categories 

of employees. In certain cases, an employer is required to report an 

employee’s dismissal to the appropriate state authorities and/or 

trade unions. 

Cost of Employment 

Employers are required to pay social security contributions on 

behalf of their employees. 

Income Tax 

The employer is obliged to withhold income taxes for its employees 

and certain social contributions. 


49


Foreign Workers in Azerbaijan 

Foreign employees who are employed by enterprises (affiliates or 

representative offices) operating in Azerbaijan are subject to 

Azerbaijani labour law, except for those working in enterprises, 

branches or representative offices located in Azerbaijan under 

employment contracts concluded in the foreign state where the 

employer is located. 

Foreign nationals wishing to work in Azerbaijan are required to 

register at their place of residence and obtain a work permit. Work 

permits are issued by the Ministry of Labour and Social Protection. 

Heads of representative offices and branches of foreign legal 

entities (and their deputies) and certain other categories of foreign 

employees are not required to obtain a work permit in Azerbaijan. 

Foreign trade regulation 

Azerbaijan has started negotiations with WTO on accession to the 

organization. The government has undertaken a number of steps to 

liberalize foreign trade. As of the end of 2008, the weighted average 

import tariff in Azerbaijan was 5.8 % i.e. significantly below the 

international average. Import and export is one of the most rapidly 

developing business segments in Azerbaijan. The average annual 

growth in foreign trade in recent years is approximately 15%. 

Azerbaijan is developing trade relations with a number of countries. 

In 2008, there were trade operations with 141 partners. The 

European Union remained the major destination for export of 

Azerbaijani goods. Russia and CIS are the major importers. 

The main export commodities are oil and petrochemicals, a/c 

products. The import includes machinery and luxury goods, 

constructions materials etc.

Azerbaijani law recognizes several customs regimes applicable to 

goods imported in Azerbaijan, of which most important to foreign 

investors being transit, customs storage, bonded warehouse, 

temporary import, processing on and outside customs territories. 

In the case of temporary import, no duties are applied and the 

goods must be re-exported from Azerbaijan until the deadline 

established by the customs authorities. The goods brought under 

the temporary import regime should be re-exported without 

substantial changes in their nature. 

Import of goods into Azerbaijan is subject to imposition of imports 

duties (ad valorem duties ranging from 0% to 15%, per unit duties, 

duties per metric units). 

Excise tax applies to certain types of goods (e.g. tobacco and 

alcohol products). Azerbaijan adopted “destination VAT” principle 

and VAT (currently set at 18%) is payable (subject, of course, to 

applicable customs regime) on the declared value of goods 

(including assessed import duties and excise tax). Certain 

categories and types of goods are import exempt and to some 

others 0% VAT applies. 0.15% customs clearance fee is applicable 

to all imports/exports with certain minor exceptions. 

Exports are exempt from customs duties, except for certain types 

of metals and metal products. 

Under PSA (Production Sharing Agreement) regime, contractors, its 

agents and sub-contractors are entitled to import and re-export 

from Azerbaijan free from import duties and restriction goods 

employed for hydrocarbon activities. Imports under PSA regime are 

subject to zero rate VAT. Similar regime applies under HGAs (Host 

Government Agreement). 


51


Azerbaijan joined GSP+ 

USA and GSP+EU in 

December 2008 

One of main steps on this way is Azerbaijan’s GSP membership. 

Advantages for Azerbaijan: 

• Access with preferential duties to the markets controlling 53% of 

all import operations 

• Exemption of duties for export of more than 7200 names of 

goods produced in Azerbaijan to EU states, as well as 3400 

names to the US. 

• Diversification of economy and growth of non-oil sector 

The GSP USA state program makes possible the duty-free import of 

about 5,000 products from 132 countries to the United States. 

From early 2009 until late 2011 Azerbaijan get special trade 

privileges in the framework of the GSP+ EU plan, proposed in 

addition to standard privileges, provided in the framework of the 

generalized system of preferences GSP. 

Another important development worth mentioning is a number of 

regional trade initiatives including Central Asia–Caucasus–Europe 

transport corridor (TRACECA) and Russia–Azerbaijan–Iran 

transport corridor (North-South Transport Corridor). 

The projects are directed at stimulation of international trade along 

the above routes via coordination of trade policies and tariffs, 

upgrade of infrastructure, simplification of customs procedures etc. 

The impact of the above initiatives on international trade of 

Azerbaijan and on its status of a regional transportation hub is 

substantial.

Currency regulation & repatriation of profit 

Foreign exchange 

Foreign exchange transactions are governed by the Law on 

Currency Regulation. The Central Bank of Azerbaijan (CBA) 

administers the overall enforcement of currency regulation. Various 

aspects of foreign currency regulation also cover precious metals 

and foreign securities, among other matters. 

Azerbaijan’s currency control legislation distinguishes between 

“residents” and “non-residents”, with more stringent requirements 

currently applying to residents. The definition of “resident” includes 

private individuals having a permanent place of residence in 

Azerbaijan and legal entities established in accordance with 

Azerbaijani legislation. Branches and representative offices of 

foreign entities established in Azerbaijan do not fall within the 

definition of a resident. Currency operations are divided into 

routine currency operations and operations involving the movement 

of capital. Routine currency operations include: 

• transfers for payment of goods and services under import/export 

contracts with a term of payment not exceeding 180 days; 

• transfers in connection with the financing of export/import 

transactions with a term not exceeding 180 days; 

• transfers of dividends, interest, and other income from deposits, 

investments, credits and other operations; 

• non-commercial transfers, for example including transfers of 

inheritances, wages, pensions or alimony. 

Operations involving the movement of capital are deemed to 

include all other non routine currency operations, e.g.: 

• direct investment in entities for the purpose of deriving profit 

and obtaining control over the entity; 


53


• purchase of securities; 

• payments for ownership and other rights to immovable property; 

• import/export transactions under credit terms of more than 180 

days; 

• deposits by banks of currency values for more than 180 days; 

• any other currency operation not deemed as a routine currency 

operation. 

Currency operations involving the movement of capital must be 

performed in a manner approved by the CBA. No procedure, 

however, has been established by the CBA on this point and, in 

effect, no licensing of the currency operations involving the 

movement of capital is required at present. 

Foreign exchange regulations are comparatively less restrictive for 

non-residents. Non-residents are permitted to hold offshore bank 

accounts without restriction, may deposit their funds offshore, and 

are not bound to sell foreign currency proceeds or submit a report 

upon withdrawal of foreign currency. Non-resident legal entities 

may purchase foreign currency on the domestic foreign currency 

market for routine currency operations and in other cases 

stipulated by legislative acts. 

Import/Export of Foreign Currency in cash by Individuals 

Resident and non-resident individuals are treated equally with 

regard to the import/export of foreign currency in cash. There are 

no limitations on the amount of foreign currency an individual may 

bring into Azerbaijan, provided that such amount is declared to the 

Azerbaijani customs authorities. 

Azerbaijani customs authorities are required to issue a certificate 

to an individual importing more than USD10,000 or its equivalent 

into Azerbaijan.

Residents can export hard currency in the amount up to the 

equivalent of USD 10,000 free of tax without any documentation 

except the tax declaration. 

Non-residents, however, are required to submit some documents. 

Residents must pay a 1% fee for the amount from USD 1,000 up to 

USD 10,000. In case the USD 10,000 threshold is exceeded, 

supporting documentation must be provided in any event. 

Pursuant to the newly-issued regulations of the Azerbaijani Central 

Bank, residents may transfer currency (movement of capital) to 

certain states (member states of the Organization of Economic 

Development and Cooperation, Russia and those having bilateral 

investment protection treaties with Azerbaijan) for the purposes 

stated in the regulation: direct investment, acquisition of securities, 

real estate purchase, transfer of currency to the resident’s deposit 

in foreign bank. There is no specific limitation as to the amount 

allowed for transfer. 

Foreign companies and individuals may have both Manat and 

foreign currency accounts in a local bank. All settlements within 

Azerbaijan including payments of employee salary should be made 

in Manats with a few exceptions. A permission of the Central Bank 

of Azerbaijan is required to conduct certain transactions in foreign 

currency. 

From 1st January 2006 new Azerbaijani manats were introduced to 

replace the old ones. The exchange of bank notes is accompanied 

by denomination of the currency at a rate of 1 to 5,000. The 

international abbreviation for the new manat is AZN. 


55


Taxes 

Tax policy and collection of taxes in Azerbaijan is carried out by the 

Ministry of Taxes. For the purposes of this review we will 

concentrate on corporate taxation. 

Currently, there are two different types of tax regimes in 

Azerbaijan. The companies that work predominantly in the oil & gas 

sector under the Production Sharing Agreements (PSA) are subject 

to the oil consortia tax regime. 

The statutory tax regime is applicable to all other legal entities. The 

statutory tax regime is regulated by the Tax Code and numerous 

normative legal acts. The tax legislation in force is regarded as one 

of the best pieces of legislation among the transition economies. 

All Azerbaijani enterprises, representative offices, branches, and 

individuals engaged in business activities (as well as foreign 

entities and individuals conducting business activity in Azerbaijan 

through a “permanent establishment” (“PE”) as defined under the 

Tax Code) must register with the tax authorities regardless of 

whether or not their activities are taxable in Azerbaijan. Divisions 

which have not established a PE are subject to a separate regime. 

Double Taxation Treaties 

Azerbaijan has signed bilateral treaties for the avoidance of double 

taxation with 38 countries. Double taxation treaty negotiations are 

currently underway with Bulgaria, Denmark, Greece, India, Kuwait 

and Kyrgyzstan. 

Road Tax 

Legal entities and individuals of foreign states as well as persons 

owning vehicles in Azerbaijan Republic must pay this tax when 

using the territory of the Azerbaijan Republic. Taxes are assessed

on cars, buses and trucks depending on seat number, days spent in 

Azerbaijan and number of other conditions (e.g. $15 - $25 per day 

for buses, etc.) 

Simplified Tax 

This tax is intended to ease tax burden for small size businesses 

and is in lieu of general profit tax. Simplified tax is charged at the 

following rates on the gross revenue of the taxpayers: 

• 4% for taxpayers operating in Baku 

• 2% for taxpayers operating in other regions of Azerbaijan and 

Nakhchivan Autonomous Republic 

In order to quality for this tax, the total revenue should not exceed 

22,500 Azerbaijan manats (approximately USD 28,125 at the 

current exchange rate) in a preceding three month period. The 

payers of the simplified tax are also exempt from VAT, profits tax 

and property tax. Simplified tax is payable on a quarterly basis. 

Dividend Withholding Tax 

Dividend withholding tax of 10% applies to both domestic and 

foreign shareholders. Tax is withheld in the currency in which the 

dividend is paid. Double Taxation Treaties (“DTT”) may reduce the 

rate at which dividend tax applies. See Annex 4 for brief 

information about DTTs in Azerbaijan. 

Other Withholding Taxes 

Foreign legal entities with no permanent presence (permanent 

establishment) in Azerbaijan are subject to withholding tax on 

income derived from sources in Azerbaijan at the following rates. 

• 10% Interest 

• 14% Rent and Royalty 

• 6% Freight income 

• 6% Telecommunication services 


57


*For detailed information 

on interest and penalties 

rates please see the table 

at the end of this chapter. 

For detailed information on 

Tax rates please see 

Annex 5. 

• 4% Insurance payments 

• 10% Interest element of financial lease payments 

• 10% Other income 

The Government of Azerbaijan proposed a reduction of the 

corporate profit tax, from the current 22% to 20%, effective from 

January 2010. 

Interest and penalties* 

There are certain interests and penalties applicable for failure to 

comply with the tax legislation. For example, interest on 

outstanding tax liabilities accrues at a rate of 0.1 percent per each 

day of delay. 

Losses and bad debts 

Losses may be carried forward over the next five years without any 

limitations. Losses cannot be carried back. Bad debts may be 

deducted from taxable income only if recognized as having no value 

in the accounting books of the company and if they were reflected 

as income in previous periods. 

Losses and bad debts recovered in the future periods shall be 

recognized as income in the period of their recovery. 

VAT registration 

There are detailed requirements for registration and accounting for 

VAT, with penalties for non-compliance. Companies with taxable 

transactions exceeding a certain threshold (currently approximately 

22,500 AZN per three consecutive months) must register as VAT 

payers. 

Other companies carrying out business activity in Azerbaijan may 

voluntarily register. Only registered VAT payers may charge VAT or 

claim a credit for input VAT that they pay.

Accounting 

The new Accounting Law 2004 stipulates gradual transition to the 

new accounting standards by the year 2008. Thus the Soviet-era 

accounting principles will eventually cease to regulate the financial 

reporting in Azerbaijan. It should be noted however, that Azerbaijan 

has already made substantial advancement towards new financial 

reporting philosophy. 

The banks as well as the companies under Production Sharing 

Agreements and similar commercial structures are not regulated by 

the 1995 Law on Accounting. 

The new Law charges the Cabinet of Ministers with the task of 

publishing new National Accounting Standards (NAS), which are yet 

to be developed. The Law stipulates that all significant entities 

including credit institutions, insurance companies, investment funds 

and commercial organizations which meet certain criteria will be 

subject to International Financial Reporting Standards (IFRS). 

Others (except for small private businesses) will have the choice of 

using either the IFRS or NAS. Small private businesses will also 

have the right to choose between the NAS or a simplified method 

of accounting. 

All entities registered in Azerbaijan which includes Azerbaijani 

Legal entities, representative offices and any branches of companies 

within the territory of Azerbaijan are required to maintain their 

accounting books and records in local currency, and in accordance 

with the Azerbaijan accounting legislation (“AAL”). This includes 

the use of a mandatory, and quite rigid, chart of accounts which, in 

most cases, will also necessitate the employment of a Full-time, 

experienced Azerbaijani chief accountant. 


59


The Civil Code 2000 contains general provisions regarding financial 

reporting and audit requirements for legal entities. Joint stock 

companies and Limited liability companies are required to use 

independent auditor to audit their annual financials. Similarly, 

Joint-stock companies are required to publish their annual 

accounting reports and balance sheets. Any legal entity with the 

value of balance sheet exceeding 1 million AZN (1.19 million USD) 

or annual revenues exceeding 500 thousand AZN (595 thousand 

USD) is required to conduct an audit of its balance-sheet. Legal 

entities with balance-sheet value of below 1 million AZN or annual 

revenues below 500 thousand AZN are permitted to prepare a 

simplified balance sheet. 

Tax Code 2000 also contains certain provisions dealing with 

accounting matters, such as depreciation. Depreciation is made in 

accordance with a declining balance method and the following 

rates apply to these selected categories of assets: 

• Buildings, facilities and installations—up to 7%; 

• Machines, equipment and computers—up to 25%; 

• Vehicles—up to 25%; 

• Intangible assets—up to 10% when life time is not defined or in 

accordance with life time when life time is defined; 

• Other fixed assets—up to 20%. 

Actual capital expenditures for production purposes made in a 

current tax year in form of buildings, facilities, installations, 

machines, equipment, computers vehicles and other assets may be 

depreciated at a rate of up to 2 times of standard rates, i.e. 

depreciated in an accelerated manner. A similar accelerated 

depreciation rate was also recently introduced for leased 

equipment in order to stimulate this leasing financial service.

As mentioned above separate chart of accounts based on western 

accounting principles has been adopted by Azerbaijani commercial 

banks few years ago. 

AAL differs from IFRS and generally accepted accounting principles 

in other countries (e.g., the United States). A summary of the most 

significant differences is as follows. 

Accounting policies 

AAL do not require detailed disclosure of accounting policies used 

in the preparation of the financial statements or footnote 

disclosures that provide additional information, analysis and 

clarification relating to the financial statements. 

Property, plant and equipment (“PPE”) 

Property, plant and equipment is maintained under the historical 

cost convention (at acquisition price or at the cost of production 

including transportation and assembly costs) as modified by the 

revaluation of these assets, if re-valued. At various times since 

1992, PPE in Azerbaijan have been re-valued in accordance with 

Government decrees (the latest such revaluation occurred in 1996). 

Indexes used for these revaluations did not properly account for the 

changes in the value of Azerbaijani Manat nor did they result in 

providing a market value for the fixed assets to which they were 

applied. Revaluations of property, plant and equipment are 

generally not required under IFRS and US GAAP under certain 

circumstances. 

Impairment of assets 

AAL does not permit the recording of an allowance against the 

carrying value of an impaired asset. This includes setting up an 

allowance for tangible assets as well as inventories, accounts 


61


receivable and other assets. IFRS requires, among other things, 

that long-lived assets and certain identifiable intangibles that are 

held and used by an entity be reviewed for impairment whenever 

events or changes in circumstances indicate that the carrying 

amount of an asset may not be recoverable. 

In addition, allowances may also be made upon the carrying value 

of short-term assets (for example, accounts receivable) when it is 

likely that the full carrying value of the asset will not be recovered. 

Deferred taxes 

Deferred tax assets and liabilities under IFRS are recorded for the 

expected future tax consequences of existing differences between 

financial reporting and tax reporting basis of assets and liabilities, 

and loss or tax credit carry forwards. Under AAL rules, there are no 

such provisions dealing with deterred tax accounting. 

Equity 

In the balance sheet of an Azerbaijani company equity is generally 

represented by charter capital, paid-in-excess capital, reserve 

capital, appropriated earnings, social funds and retained earnings 

for the current and previous years. Deductions can be made 

directly from reserve funds for non-tax deductible expenses. Under 

IFRS, equity is generally represented only by Share capital, 

additional paid-in capital and retained earnings for the current and 

previous years. 

Intellectual property 

In 1996 and 1997 Azerbaijan started implementation of the national 

system for registration and protection of intellectual property 

rights. Intellectual property rights in Azerbaijan include: all rights 

to industrial property (including inventions, industrial designs,

utility models, trademarks, and geographic names); and copyright 

and related rights. Current legislation pertaining to intellectual 

property includes the Law On Copyrights and Related Rights (the 

Copyright Law), the Law On Trademarks and Geographic Names, 

the Law On Patents, and the Law On Topology of Integral Schemes. 

Under existing legislation, the Cabinet of Ministers is empowered 

to authorize various state agencies to register and protect 

intellectual property rights in respective areas. The State Agency 

for Standardization, Metrology and Patents is responsible for the 

issuance of patents and trademark registration. There is also the 

State Copyright Agency which is responsible for the registration of 

the copyrights. Beyond this however, procedures for the 

registration and protection of various intellectual property rights 

differ from one state agency to another. 

Azerbaijan is a party to several international agreements 

concerning the protection of intellectual property including: the 

Convention Establishing the World Intellectual Property 

Organization; the Paris Convention for the Protection of Industrial 

Property, the Madrid Agreement Concerning the International 

Registration of Trade Marks, the Madrid Protocol, the Patent 

Cooperation Treaty, and the Eurasian Patent Convention, the 

Performances and Phonograms Treaty of the World Intellectual 

Property Organization Copyright Treaty of the World Intellectual 

Property Organization. 

Azerbaijan is a “first to file” and not a “first to use” jurisdiction, 

meaning early registration of intellectual property rights is 

essential to ensure protection. Patent protection is granted to an 

invention if it is novel, inventive and useful. The maximum duration 

of protection for an invention patent is 20 years. 


63


Utility models are granted patent protection if they are new and 

“industrially applicable”. The term of utility patents is ten years. 

An industrial design right is characterized by an artistic and 

structural form which determines its external appearance. Patent 

protection is granted if an industrial design is novel, original, and 

capable of industrial application. The term is ten years. 

Patents may be assigned and/or licensed by their owner(s) to 

natural persons or legal entities. However, an assignment must be 

registered with the relevant state agencies to be valid. 

Infringement carries civil, criminal and administrative liability. 

The right to a trademark is based on registration with the 

respective state agencies. Trademark registration is granted for a 

term of ten years, renewable every ten years. Assignments of 

licenses for trademarks and geographic names must be registered 

with the relevant state agencies. 

Legal protection is given to the appellation of origin of goods based 

on registration with the relevant state agencies, and to trademarks 

existing under international agreements on the registration thereof 

or bearing the status of a known trademark. Violations of intellectual 

property rights carry civil, criminal, and administrative liability. 

The Copyright Law protects works of science, literature and the 

arts (copyrights) as well as stage productions, phonograms of radio 

or cable broadcasts, and computer programs and databases (allied 

rights). Copyright protection is normally granted to the author 

without registration. The right to use a copyrighted work may be 

re-assigned. 

A copyright provides protection for the lifetime of the author and 

normally for a period of 50 years following his or her death.

Rights to computer programs, databases and topologies of 

integrated circuits are protected under the Copyright Law and the 

Law on Topology of Integral Schemes. The unauthorized re-creation 

(copying) of computer programs, alteration of existing programs, 

and unlawful accessing of legally protected computer information 

are criminal offences. 

Proper quality is determined by legislative norms and technical 

specifications applicable to a particular product. Certain goods are 

subject to mandatory certification by state agencies, in accordance 

with procedures established by legislation. The advertising and 

distribution of goods without such certification is prohibited. 

Dispute resolution & arbitration 

Courts 

Azerbaijan has a three-tier court system - courts of first instance, 

appellate courts and cassation court. Courts of first instance are 

the district (city) courts of general jurisdiction, local economic 

courts, and military courts. 

It is necessary to emphasize that Azerbaijani courts are undergoing 

a critical stage of transition and reforming from a soviet type “just 

courts” to an independent and modern judiciary. Vital steps such as 

re-appointment of judges and recent legal reforms are 

underpinning this process. It is safe to say that Azerbaijani system 

is becoming more relevant and appropriate for an open market 

economy. 

Courts of general jurisdiction address disputes arising out of civil, 

family, or land-related matters, use of natural resources, 

environmental protection, tax, administrative and other matters, 

where at least one of the parties to a dispute is a physical person 


65


and where he does not have the status of an entrepreneur, or, if he 

has such status, the dispute arises other than in connection with 

the carrying out of his entrepreneurial activity. 

The economic courts consider cases in respect of economic 

disputes arising from civil, administrative and other legal relations 

between legal entities and physical persons with the status of 

individual entrepreneurs. Pursuant to the Decree of the President, 

the Economic Court of Appeals was liquidated and the regional 

appellate courts were established in Baku, Ganja, Sheki, Sumqayit 

and Shirvan cities. 

The decisions of the appeal courts can be further appealed to the 

court of cassation. The appellate board for civil cases of the 

Supreme Court considers appeals brought in respect of the 

decisions of boards for civil case of appellate courts. The appellate 

board of the Supreme Court for economic cases reviews the 

decisions of the decisions of boards for civil case of appellate 

courts. The cassation court is located in Baku. 

Mandatory enforcement 

Enforcement procedures set forth in Law on the Execution of Court 

Orders apply to judgments of Azerbaijani and foreign courts as well 

as international arbitration and foreign arbitration awards. 

The following documents have the status of execution orders: 

• court orders (e.g. judgments of azerbaijani courts, interim orders, 

awards of international arbitration courts and tribunals, 

decisions of courts of foreign states and arbitration courts); 

• notarized agreements concerning the recovery of alimony and a 

collateral in a mortgage agreement; 

• execution notes of notaries; 

• decisions of state bodies (officials) authorized to consider cases

elating to administrative offences; 

• the mortgage lists issued under the agreements for the mortgage 

of immovable property; 

• decisions of other state bodies when provided by law. 

the documents should be submitted to a bailiff for execution within 

following periods: 

• writs issued in accordance with courts decisions and courts 

orders – one month; 

• writs issued in accordance with resolutions of courts on taking 

of measures related to provisional remedies—immediately; 

• execution notes of notaries and decisions of bodies (officials) 

authorized to consider cases on administrative offences—ten 

days; 

• writs issued in accordance with decisions of international 

arbitration court and arbitration tribunals and decisions of courts 

of foreign states and arbitration courts—three years. 

Failure to voluntarily execute the appropriate decisions triggers 

obligatory execution. The following are obligatory execution 

measures: 

• foreclosure and subsequent sale of assets; 

• garnishment of salaries and similar payments; 

• foreclosure of debtor’s assets in possession of third parties; 

• taking of debtor’s assets with subsequent transfer to claimant. 

Referral of a dispute to arbitration is a permitted dispute resolution 

mechanism. In general, matters over which courts have jurisdiction 

can be arbitrated in cases provided in law, international agreements 

and upon agreement of the parties. 

Azerbaijani courts have exclusive jurisdiction over certain matters 

which include, inter alia, rights over immovable property located in 


67


Azerbaijan, cases concerning the recognition of patents, or other 

marks or rights, if such were registered (or application for registration 

was filed) in Azerbaijan, cases where an action is brought 

against a carrier under a contract for the carriage of goods, or 

cases relating to the existence of a legal person registered in 

Azerbaijan or cases where cancellation of a decision taken by a 

legal person is sought. 

Interestingly enough, civil procedure legislation does not set forth 

provisions regulating the conduct of domestic arbitration. Hence, 

one can naturally assume that the parties are at liberty to provide 

for these by their agreement. 

Commendably, Azerbaijan has made significant progress as far as 

international arbitration is concerned. Azerbaijan acceded to and 

ratified the 1958 New York Convention on the Recognition and 

Enforcement of Foreign Arbitrage Awards (New York Convention), 

the 1965 Washington Convention on the Settlement of the Investment 

Disputes between States and Nationals of Other States (the 

“Washington Convention”) and the European Convention on 

Foreign Commercial Arbitration, dated 21 April 1961. Azerbaijan 

has also enacted the Law on International Arbitration, which 

basically adopts the UNCITRAL Model Law on International Commercial 

Arbitration of 21 June 1985. 

In addition, Azerbaijan is a signatory to 1998 Agreement on the 

Order of Reciprocal Enforcement of Arbitrage Awards and 

Economic Court Judgments on the Territory of the countrymembers 

of the Commonwealth of Independent States. 

Decisions on enforcement and recognition of foreign arbitrage 

awards are taken by the Supreme Court. In certain cases, enforcement 

can be declined, most notably, if:

• an award contravenes legislation, offends public policy or 

sovereignty of the Republic of Azerbaijan; 

• the principle of reciprocity is not adhered to; 

• there is a valid judgment of an Azerbaijani court relating to the 

same parties and same subject-matter; 

• an award has not entered into force in the country where it was 

made. 

The New York Convention will certainly not apply to the recognition 

and enforcement by the Azerbaijani courts of domestic awards 

(where an award is made in Azerbaijan arbitrary proceedings). In 

the absence of relevant provisions in the civil procedure law, the 

Law on International Arbitration could be looked at for guidance. 

Under said law an international commercial arbitrage award made in 

arbitration proceedings in Azerbaijan may be set aside if, inter alia: 

• notice of an appointment of an arbitrator or arbitration 

proceedings were defective; 

• dispute does not fall within a scope of the arbitration agreement; 

• composition of the arbitration tribunal or the arbitration 

procedure was not in accordance with the agreement of the 

parties; 

• subject-matter of the dispute is not capable of settlement by 

arbitration under legislation of the forum state; 

• arbitrage award is in conflict with Azerbaijani legislation. 

It is noteworthy that under the Constitution of Azerbaijan international 

treaties ratified by the Republic of Azerbaijan prevail of 

national (domestic) laws in case of conflict. Therefore, in case of 

international arbitration under the Washington Convention, the 

arbitrary award will be enforceable in Azerbaijan as if it were a 

final judgment of a court in Azerbaijan (Article 54 of the Washington 

Convention). 


69


Privatization 

Foreign investment under Privatization Programmes 

Under the Privatization Law, the following are considered to be 

foreign investors: 

• foreign legal entities and their subsidiaries; 

• Azerbaijani legal entities in which participation of foreign 

investment exceeds 50% of the entity’s charter capital; 

• foreign nationals; and 

• stateless persons. 

To date, Azerbaijan has undergone a long process of transferring 

from a state-dominated economy to the current situation where 

84.5% of the economy is held in private hands. This became 

possible largely thanks to the denationalization of state owned 

enterprises and property. Privatization occurred in two stages. 

The denationalization of small sized enterprises was carried out 

within the First Stage Privatization Programme (1995-1998). Thirtynine 

thousand enterprises as well as 1.3 million hectares of land 

were sold and distributed to private persons and legal entities, 

more than 1,550 medium and large enterprises were transformed 

into stock-companies. 

Few large enterprises were also sold to investors as part of the 

Programme. They include, among others, a brewery, and cement 

and steel plants transferred to foreign investors. 

In general, the sum of revenues from privatization in 1995-2008 

was 388.454 million AZN (more than 480 million USD). As a result 

of privatization, more than 500,000 job places were made available. 

Currently, the Second Stage Privatization Programme adopted in 

2000 is underway and covers more strategic and broader sectors of

economy such as transport, communication, construction, chemical 

and heavy engineering industry, metallurgy, etc. It stipulates 

privatization of mainly medium and large enterprises. 

The enterprises are declared “open for privatization” by special 

Decrees signed by the President. The list of enterprises currently 

open for privatization is available to the public. 

The law also contains the list of exemptions, i.e. enterprises that 

can not be denationalized. Such enterprises include military and 

other facilities of strategic importance. Railways, radio and TV 

stations, irrigation systems are excluded from the privatization 

as well. 

The programmes explicitly do not mention any difference as 

regards as to who may participate in privatization, i.e. foreign 

national takes part in the process on a non discrimination basis. 

The State Committee on Management of State Property is in 

charge of privatization process. There are few privatization 

methods legally adopted in Azerbaijan: 

• direct sale to strategic investor; 

• sale at the investment tender; 

• special cash and voucher auctions; 

• general auctions; 

• sale to employees on preferential terms. 

The Government also practices long term transfer of management 

to a private operator in accordance with an obligatory investment 

programme. 

Presently, the number of medium and large enterprises privatized 

within both Privatization Programmes is over one thousand. 


71


There are, however, still very substantial opportunities in privatization 

as a mode of entry to the market. 

At present privatization process plays a significant role in the 

development of the economy. 

Hereto, in order to improve the privatization process, a number of 

measures such as involvement of advisory companies, independent 

experts and valuators, educational and promotional works, 

organization of different events with participation of local and 

foreign investors are being implemented by State Committee on 

Management of State Property. 

Besides this, www.stateproperty.gov.az and www.auksion.az web 

sites provide comprehensive information about enterprises open for 

privatization, investment projects in different sectors of economy 

as well as current situation of privatization of state property. 

Revenues from privatization in 1998-2008 

mln. AZN

Interest and penalties 

Breach* Fine 

Failure to register as a taxpayer with the tax authorities AZN 40 

Failure to file declarations AZN 40 

Understatement of tax liability 50% of understated tax 

Payments from petty cash while bank accounts are imposed tax 

sanctions or penalties by the tax authorities 50% of expenses paid from petty cash 

Failure to notify tax authorities on changes in a taxpayer’s 

registration documents AZN 40 

Failure to obtain the certificate-duplicate from the tax authorities 100% of money transferred to accounts opened in nonresident 

banks and other non-resident credit institutions for 

entrepreneurial activity purposes without obtaining a certificateduplicate 

from tax authorities. 

Failure to remit VAT amounts in accordance with the procedure 

determined by the Tax Code and a relevant executive authority. 50% of the outstanding VAT amount 

*The statute of limitation period for a tax law violation is set as three years. More detailed information on the Production Sharing 

Agreements may be obtained from the Oil & Gas (including regulatory environment of the industry) article of this publication. 

Imports and Exports by countries in 2008 (mln USD) 

Import Export 


Total mln US$ ratio % Total mln US$ ratio % 

5708.5 100.0 6058.3 100.0 

Italy 18.85 2.6 Italy 1922.01 40.2 

USA 26.61 3.7 USA 601.42 12.6 

Israel 8.0 1.1 Israel 360.58 7.6 

India 11.03 1.5 India 243.24 5.1 

continued on the next page 

73


Imports and Exports by countries in 2008 (mln USD), continued from the previous page. 

France 13.27 1.9 France 232.26 4.9 

Russia 134.97 18.8 Russia 58.28 1.2 

Spain 2.80 0.4 Spain 149.76 3.1 

Netherlands 8.02 1.1 Netherlands 135.34 2.8 

Turkey 80.73 11.3 Turkey 62.61 1.3 

Indonesia 0.55 0.1 Indonesia 141.10 3 

UK 38.59 5.4 UK 92.59 1.9 

China 47.85 6.7 China 49.89 1 

Chile 0.015 0 Chile 93.39 2 

Korea Republic 16.26 2.3 Korea Republic 69.68 1.5 

Germany 59.85 8.4 Germany 20.54 0.4 

Ukraine 56.72 7.9 Ukraine 17.21 0.4 

Canada 1.78 0.2 Canada 56.65 1.2 

Croatia 3.072 0.4 Croatia 54.26 1.1 

Georgia 5.15 0.7 Georgia 49.07 1 

Kazakhstan 20.00 2.8 Kazakhstan 29.02 0.6 

Iran 9.72 1.4 Iran 35.56 0.7 

Finland 24.59 3.4 Finland 16.07 0.3 

Japan 24.04 3.4 Japan 14.58 0.3 

Taiwan 0.54 0.1 Taiwan 35.39 0.7 

Greece 0.66 0.1 Greece 29.08 0.6 

Other Countries 102.57 14.3 Other Countries 205.90 4.3


77 

Mountain Bazarduzu is the highest peak (4.466 meters above 

sea level) in Azerbaijan, as seen from mountain Shahdagh.



AZERBAIJAN 

79 

SECTORS 

REVIEW


Caspian sea oil rigs. 

Oil & Gas (With Regulatory Framework) 

By the late twentieth century with the discovery of huge oil 

reserves, Azerbaijan, which at that time was a part of tsarist 

Russia, quickly became one of the oil industry centres of the world, 

providing for approximately half of the world’s oil supply. 

A number of foreign oil companies and powerful investors, 

including Shell, Rothschild, the Nobel brothers and many others 

had interests in Azerbaijan. 

In the late twentieth century, after gaining its independence from 

Soviet Union the country again became the hot spot for the oil men 

of the world. The Azerbaijani govern ment invited the largest 

international oil companies such as British Petroleum, Amoco, 

Total, Elf, Lukoil, Itochu and others to jointly develop the previously 

closed hydrocarbon reserves of the Caspian basin. 

Now the country is on the verge of its’ second oil boom. Azerbaijan 

attracted a large number of foreign investors to operate in oil fields 

in accordance with Production Sharing Agreements between the 

govern ment and the prominent western companies. 

By now, most of the global oil & gas corporations either operate or 

are present in Azerbaijan: Azerbaijan’s oil production (total liquids) 

reached 1, 000, 000 barrels per day (bbl/d) in 2008 (SOCAR) and the 

remainder mainly comes from an international consortium. 

Azerbaijani International Operating Company (AIOC) 

Around 60% of Azerbaijan’s oil output comes from the State Oil 

Company. Its portion, however, will decrease as the international 

contracts are developed. 

AIOC’s main offshore field known as Azeri-Chiraq-Gunashli (ACG) 

has proven crude oil reserves of 1 billion tons (between 40%-70%

of Azer baijan’s total reserves). Total investment for the contract is 

about $15 bln. 

The exploitation of the hydrocarbons in Azerbaijan as well as 

similar projects in the neighboring countries led to the development 

of the regional system of pipelines. Two major pipelines were 

renovated in late 1990’s: Azerbaijan-Georgia (Baku-Supsa) and 

Azerbaijan-Russia (Baku-Novorossiysk) and now transport the bulk 

of Azerbaijani oil. 

The new Baku-Tbilisi-Ceyhan (Azerbaijan-Georgia-Turkey) pipeline 

which costs more than $4 billion and one of the largest energy 

projects globally is the main oil pipeline in the region. 

Parallel to the BTC a gas pipeline Baku-Tbilisi-Erzurum is envisaged. 

It is to take the natural gas from the recently discovered major 

Shahdeniz oil field to Turkey and possibly further to Greece and the 

south east of Europe. 

As the BTC pipeline is fully operational and ACG developed, oil 

production and exports increased dramatically. The peak of Azerbaijan 

oil production is projected for 2009 with 1.3 mln barrel per day. 

State Oil Fund of the Republic of Azerbaijan (SOFAZ) 

A number of agreements on joint development of oil and gas 

resources were signed with foreign investors in the frame of Oil 

Strategy, created by national leader Heydar Aliyev, which has being 

realized since 1994. The issue on effective management of 

revenues from implementation of these agreements was brought to 

agenda. The State Oil Fund of the Republic of Azerbaijan (SOFAZ) 

was established in accordance with the Decree of the President of 

the Republic of Azerbaijan # 240 dated December 29, 1999 for the 

purpose of formation such mechanism. The cornerstone of the 

SECTORS REVIEW 

SOFAZ 

81


philosophy behind the Oil Fund is to ensure inter generational 

equality of benefit with regard to the country's oil wealth, whilst 

improving the economic well-being of the population today and 

safeguarding economic security for future generations. In 

December 2008, SOFAZ reported $11.2 billion. According to “BP 

Statistical Review of World Energy 2009” Azerbaijan has proven 

natural gas reserves of 42.3 trillion cubic feet (Tcf). 

The country’s leading natural gas producer, the Bahar oil and gas 

field, is located off the southern tip of the Absheron Peninsula and 

currently accounts for slightly over half of the country’s natural gas 

output. The Gunashli field accounts for approximately 67% of the 

oil and 50% of the natural gas produced in the country. 

Azerbaijan opened the Caspian Sea region for international 

business. The oil & gas sector of the Azerbaijani economy is an 

excellent example of a successful cooperation between 

multinationals and the government of a country in transition. 

The country’s oil & gas policy proved extremely successful in 

opening it up for the international businesses in other sectors. 

At present, a number of international service companies, 

engineers, shippers in the oil related industries successfully do 

business in Azerbaijan. 

Extractive Industries Transparency Initiative (EITI) 

The initiative launched by the former UK Prime Minister Tony Blair 

at the World Summit for Sustainable Development in Johannesburg 

in September 2002. 

The Government of Azerbaijan declared its willingness to join EITI 

and support the international efforts for higher transparency in the 

extractive industries and becoming a pioneer country in the implementation 

process at the EITI Lancaster House Conference on June

17, 2003. Following that the President Ilham Aliyev instructed 

Cabinet of Ministers of Azerbaijan to establish an interagency 

National committee on EITI to implement obligations taken at the 

EITI Conference. 

Some thirty five countries have either endorsed, or are now actively 

implementing EITI across the world. 

On March 15, 2005 Azerbaijan published the first ever EITI report. 

Since then, the Government of Azerbaijan successfully disclosed 

eleven EITI reports. 

EITI process is recognised as an international brand of transparency 

in extractive industries and in order to safeguard this international 

brand the Validation process has been launched. Validation is 

an essential element of the EITI process, and central to the initiative’s 

status as an international standard. The objective of Validation 

is to provide an independent assessment of the progress 

achieved by Implementing Countries on their progress on EITI and 

what measures they may need to take to make better and faster 

progress. Azerbaijani Government tremendously contributed to the 

development of the validation process and, moreover, Azerbaijan 

expressed it’s willingness to pilot and test the validation process in 

the country. As Azerbaijan was a first country publishing EITI 

report, Azerbaijan has became a first ever country to successfully 

complete Validation process and obtain EITI Compliant status. 

Production Sharing Agreements 

The Government of Azerbaijan in PSA is represented by the 

national oil company, the State Oil Company of the Azerbaijan 

Republic (SOCAR), which has been responsible for implementing 

Azerbaijan’s state policy for the oil and gas industry. SOCAR has 

executed all of the PSAs concluded so far between the Government 


83


*To date, more than 30 PSA 

were concluded between 

Azerbaijan and translational 

oil corporations. The 

shareholders in the largest 

PSA (Azeri, Chirag, Guneshli) 

are: BP, Unocal, Inpex, Statoil, 

ExxonMobil, TPAO, Devon, 

Itochu, Delta Hess and 

SOCAR. The oil reserves in 

this field alone are 630 mln 

metric tons. 

of Azerbaijan and foreign oil companies. Owing to the absence of 

any national legislation that covers the oil and gas industry and 

specifically addresses the need for sector growth, such PSAs have 

been enacted into the legislative system of the Republic of 

Azerbaijan as laws of the country. 

Each PSA does not only constitute a part of the Azerbaijani legal 

system: it also takes precedence over “general” Azerbaijani legislation 

in the event of any inconsistency between the PSA and any 

other Azerbaijani law of general application. To date more than 30 

PSAs* have been signed and adopted as laws of the Republic of 


One of the areas of particular interest to foreign oil production and 

service companies is the tax regime introduced by the PSAs. Given 

the significance that the Government attaches to the development 

of the energy sector in Azerbaijan, substantial tax concessions have 

been granted to the oil companies involved in the development of 

the energy sector of Azerbaijan under production sharing agreements. 

The principal objective of oil and gas taxation is to maintain 

a balance between obtaining a fair share of revenues from oil- and 

gas-related activities carried out in the country and retaining the 

attractiveness of the oil fields in Azerbaijan and the Azerbaijani 

sector of the Caspian Sea to foreign investors. Each PSA contains a 

specific article dealing with the taxation of oil and gas production. 

In accordance with PSAs (which are uniform with regard to taxation), 

oil companies pay only one tax: namely, a Profit Tax on the 

taxable profit derived from sales of oil and from certain other 

sources specified in the PSAs, at a fixed rate for a calendar year. 

The Profit Tax rate varies, depending on the PSA, from 25% to 32%. 

Oil companies that are parties to a PSA Contract will not be liable 

to any existing or future taxes (except for the Profit Tax) of any kind

whatsoever in respect of their oil and/or gas production. The 

taxable profit (or loss) of Contractors under PSAs is computed in 

the generally accepted manner, i.e. sales income less taxdeductible 

expenses. The list of tax-deductible expenses is 

specified in each relevant PSA and is usually quite extensive. 

The revenues of foreign companies providing services to oil 

companies under the scope of a PSA (Foreign Sub-contractors) 

are subject to a withholding tax at different rates varying from 5% 

to 8% depending on the particular PSA. Only goods and services 

supplied by Foreign Sub-contractors on the territory of Azerbaijan 

are subject to this tax. No other taxes are payable by Foreign 

Sub-contractors operating under any PSA. 

Value Added Tax is not applicable to any supplies and sales 

within the ambit of any PSA. Under the PSAs, Double Tax Treaties 

entered into between Azerbaijan and a relevant country may 

apply as long as they provide better treatment for persons operating 

under the PSA. Contractor Parties as well as Sub-contractors 

(including the Foreign Subcontractors) may import and re-export 

free of duties and taxes any machinery, equipment, fixed assets, 

goods, works, and services for use under the PSAs. 

Although the system of regulation of the industry through PSAs is 

in place and working effectively, the Government of Azerbaijan 

continues improving the legislative base of this sector of the 

economy. A number of laws regulating the oil and gas industry 

have been approved by the Azerbaijani Parliament (Milli Majlis) 

over the past few years, including the “Subsoil” and “Use of 

Energy Resources” laws. As part of restructuring programme 

taking place in the energy sector of Azerbaijan, a new Ministry 

of Industry and Energy was established by Presidential Decree on 

6 December, 2004. 


85


mln. ton 

mln. m 3

Minerals & mining 

Apart from major oil & gas deposits there are numerous mining 

sites for ferrous and nonferrous metals, unique construction 

materials. An area to be mentioned specifically is the north west of 

the country (Dashkesan, in particular). Major deposits of aluminium 

ore, iron ore and non ferrous metals make the region a very interesting 

part of Azerbaijan to explore. 

Apart from metals, construction materials including gypsum, 

limestone, trim stone etc. scattered all over the country are of 

particular interest. The deposits of iodine, gold and other precious 

metals, mineral spring, etc. add up to the diverse geology of 


The processing industry that was inherited from the times of USSR 

allows for speedy rehabilitation of a number of prospective fields. 

As mentioned before the laws permit a foreign company to become 

a manager of the mining fields in Azerbaijan after conclusion of an 

appropriate agreement with the Government. 

Energy 

Azerbaijan’s existing power generation capacity, fuel resources and 

infrastructure is not only able to satisfy domestic needs for energy 

but can also offer substantial export opportunities for electricity. 

New legislation and a wide-range of reforms have been introduced 

recently in order to satisfy the demands of the market. The main 

legislative acts regulating the power sector are the Law On the Use 

of Energy Resources (the Energy Resources Law), dated 30 May 

1996, the Law On Electrical Energy (the Electricity Law), dated 13 

June 1998, and the Law On Electricity and Heat Power Stations, 

dated 28 December 1999. 


87


A medium and long-term strategy for the power sector was 

prepared recently. A Decree of the President dated October 21, 

2004 mandating a new “State Programme on usage of alternative 

energy sources” gave additional impetus to the industry. In parallel 

with this, the “State Programme on development of Fuel-energy 

complex of Azerbaijan Republic in 2004-2015” was prepared, and 

approved by Head of State. 

A loan from the Japanese International Cooperation Bank in 2002 

facilitated the construction of an oil-associate gas generating plant 

with capacity of 400 megawatt. An agreement to build another 

similar plant also reached. The construction of another off-gas 

processing plant with a capacity of 517 MW by Siemens in Sumgayit 

has been finished. The goal is to increase energy generation 

and to achieve better environmental protection. It is also expected 

that finance for 330-220 KV electric transmission lines designed to 

link the four national power systems of Azerbaijan, Russia, Iran and 

Georgia will be provided by international sources. A project financed 

by KfW bank of Germany, aimed at replacement of some of 

equipment (transformers, switches etc.) in high-voltage (330-220 

and 110 KV) sub-stations of the power supply system is underway. 

The construction of new station with the capacity of 300 MW 

produced by Finnish company “Wartsila” at Sangachal has been 

considered rational and in February 2007 preparation works of the 

construction area began. The difference of this station from others 

is that here will be used gas fuel as well as black oil fuel. This 

station will play a big role at strengthening of Baku and Absheron 

peninsula power security in future. The works on the project was 

finished at the end of 2008. 

The construction of second power unit with the capacity of 400 

MW at “Shimal” power station in Shuvalan is planned.

The Japanese company Tepsco and Finnish company Enprima 

provide advisory services to this project. Now the process of 

election of lead contractor proceeds. It is considered to finish 

all construction works by the project in 2009. The execution of 

this project will play the main role at the power maintenance 

and strengthening of power security of Baku and of the entire 

Absheron region. 

Participation of private business in power generation and distribution 

is permitted by law, and electricity generated by private 

producers may be delivered to consumers without any restrictions. 

Fuel is supplied to private producers may be delivered on the same 

terms as to state owned power stations. 

The Azerbaijani government’s priorities in respect of projects aimed 

at improvement of energy supply to households and industry are as 

follows: 

• construction of new combined cycle unit (780 mw) at janub 

power plant; 

• construction of new medium-sized generating stations (100 mw) 

by private investors. (intended to improve service to consumers, 

promote competition and enhance the sustainability of the 

system); 

• construction of small wind farms and hydropower stations. The 

expert opinion is that they may be very efficient. private 

investments are welcome; 

• construction of new hydropower stations of over 500 mw 

capacity on kura river and 25-mw fuzuli hpp on mil irrigation 

channel; 

• introduction to the azerbaijani market (or domestic production) of 

the energy efficiency equipment and technology. 

Private capital in the electricity sector is encouraged by legislation 


89


in order to support energy efficiency and to increase the confidence 

of investors. Since independence, the implementation of power 

sector legislation has been complicated by, among other things, the 

absence of a state agency performing functions such as the 

issuance of relevant licenses, tariff regulation, and the conclusion 

of contracts with investors. The creation of such a regulatory 

agency became an urgent issue in 2001 in the light of the above 

mentioned developments in the power sector. 

A Presidential Decree “On Establishment of the Ministry of Industry 

and Energy of the Republic of Azerbaijan” was issued on 6 

December 2004. Under this decree, the new Ministry of Industry 

and Energy is to assume the functions of the previous Ministry of 

Fuel and Energy and some of the authorities of each of SOCAR, 

Azerenerji and Azerigaz. Matters within the Ministry’s competence 

include the preparation and implementation of state policy in the 

fuel and energy complex, including the production, transportation 

and processing of oil and gas. 

Specifically, the Ministry prepares, negotiates, executes and 

oversees implementation of production sharing or other agreements 

on behalf of the state with respect to the development of 

hydrocarbon reserves in the Republic of Azerbaijan. Under the 

Energy Law, a foreign investor wishing to enter the power market 

must obtain a permit to do so and, thereafter, conclude a contract 

with authorized state agencies to conduct certain activities. 

Contractors are also required to have their business plans approved 

by central and local state executive authorities. 

As a general rule, special permissions to carry out activity in the 

power sector are granted and the contractors determined on a 

tender basis. The Electricity Law requires that individuals and legal 

entities must obtain special permission for conducting activities in

Production and consumption of electricity (million kWh): 

Years 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 

Energy production 17943 20056 20612 21076 23722 24117 22348 26309 21349 20723 

Import 899 1357 1642 2375 2436 2373 2082 1766 360 143 

Total supply 17044 18699 18969 18701 21285 21744 22872 24543 20989 21642 

Total consumption 15001 16423 17086 16317 18407 18955 20043 21655 18067 17700 

Industry 4442 2671 3881 3041 4390 4998 4697 5225 4091 2979 

Construction 175 36 75 25 37 87 210 360 57 153 

Agriculture 2603 803 827 662 696 487 499 510 74 640 

Transport 663 537 551 503 657 512 587 650 272 384 


Household 4075 9902 10172 11139 12079 11904 12253 13795 8409 7444 

Other 3043 2474 1580 947 548 967 1797 1115 5161 6100 

Losses 2443 2770 2560 3834 4444 4154 4031 3775 429 

Export 499 378 966 925 871 1008 880 879 726 808 

91


the generation, transportation and distribution of electricity. Such 

permission is issued by the relevant executive authority pursuant to 

an application by an interested party. In order to obtain such 

permission, an applicant is required to meet the quantitative needs 

for electrical energy, provide for an economical and effective 

supply of electricity within the boundaries of the area, and prevent 

possible damage to the environment and historical and cultural 

monuments. Information of a technical and financial nature must 

also be provided. 

All power projects and production, technological processes and 

services, facilities and devices connected with or related to the use 

of energy resources and their production, transmission, and 

consumption, are subject to mandatory certification, i.e. 

confirmation that they comply with established ecological, sanitary, 

fire, construction, and health and safety standards. Additionally, 

major projects as defined in the Energy Resources Law require a 

feasibility study by the state commission created for such purposes. 

Existing Azerbaijani legislation provides that consumers have the 

right to choose any energy supplier regardless of its location. 

Energy is supplied under agreements between consumers and 

energy suppliers. Agreements on the sale and purchase, 

transportation and exchange of electricity and heat must comply 

with the Rules on the Use of Electricity and Heat. 

Energy consumption is subject to mandatory metering. The procedure 

for disconnecting consumers from the network or termination 

of power supply is regulated by the Rules on the Use of Electricity 

and Heat as well as by agreements with consumers. The suspension 

of a power supply or the disconnection of some consumers is 

prohibited. The list of such consumers is determined by an authorized 

state agency.

Agriculture 

Production of Azerbaijani agriculture 

Azerbaijan is one of the world’s oldest agricultural centres. The 

country’s climatic diversity allows a very broad range of crops to be 

cultivated. At the moment agriculture accounts for approximately 

12% of domestic product. 

The sector is growing rapidly. The annual average growth since 

2000 in the sector has been 10.0 %, i.e. one of the highest 

sustained growth rates registered. Agriculture and related sectors 

are the principle employers in the country. 

The reforms in the agricultural sector of the economy continue, and 

despite substantial decline in the early years of transition, 

agriculture in Azerbaijan is now firmly on the way to rehabilitation 

and growth. 

Following almost full denationalization of the sector (at the moment 

circa 99% of the sector is in private ownership) a number of steps 

were taken by the government to support the farmers as well as 

producers of processed a/c products. 

In addition to meeting most of domestic demand with high quality 

products, the country’s agricultural producers are traditional 

suppliers to a number of large regional markets. The most 

substantial one is the market of the former Soviet Union 

(including Russia). 

Azerbaijani fruits, vegetables, wines and brandy have become 

brands of Azerbaijan in the region. Azerbaijan has achieved a 

record harvest of cereals in 2009’s 3 mln tons. Apart from food 

products Azerbaijan is also traditionally strong in cultivating such 

nonfood crops and products as cotton, silk and tobacco. The sector 


93


Please see Annex 6 for 

some statistics on major 

a/c products grown in 


has already exceeded the best outputs of soviet times for a number 

of products, such as fresh fruits and vegetables, cattle and poultry. 

Azerbaijan is strong in such items as wine and brandy production, 

tea, tobacco and hazelnuts. 

Substantial business opportunities are now opening up in the 

agriculture of Azerbaijan for a number of reasons. The Azerbaijan 

government has embarked on a very ambitious Programme of 

Regional Development. The Programme includes development of 

agriculture and food processing development as one of its key 

elements. It also includes rehabilitation of major infrastructure, 

promotion of exports, more effective management of businesses, 

and rehabilitation of existing facilities and development of greenfield 

projects. 

Along with traditional agricultural products, substantial 

opportunities exist in export oriented segments. It is definitely 

worth mentioning that the Government introduced tax holidays for 

the producers of a/c production that continues up to now. The 

measure has undoubtedly stimulated the growth in the sector. 

The Government also carries out lending activities for development 

of storehouse network for storage of fruits and vegetables. A lot of 

storehouses and grain elevators are being constructed now due to 

preferential terms of financing offered by National Fond of 

Entrepreneurship Support and Azerbaijan Investment Company. 

Vegetables 

Vegetable growing is the important element of the Azerbaijani 

agricultural sector. Major vegetable growers are Lankaran-Astara 

and Guba-Khachmaz regions. Natural conditions incentivize 

cultivation of these products in other regions as well.

While in 1991 only 39 thousands hectares were utilized for 

vegetables, in 2008 the figure grew up to 83.2 thousands hectares. 

In the period of 1992-1995 the average amount of annual vegetable 

production was approximately 450-500 thousand tons, in 2008 it 

constituted 1228.3 thousand tons. Apart from domestic market 

niche this segment of a/c remains one of the export commodities 

(predominantly for the large Russian market). Azerbaijani fresh 

vegetables (tomatoes, greens, melons, cucumbers etc.) remain 

trademark of Azerbaijan very well known in the region. 

Fruits 

Fruit growing is one of leading spheres of the local agriculture. 

Total territory used for all types of fruits and berries in 2008 was 

120 thousand hectares. 

Seeded fruits (apples, pears); quince drupaceous (plum, cherry, 

sweet cherry, peaches); strong scales (nuts, hazel nuts, almond); 

citruses (lemon, oranges); and subtropical cultures (figs, grenade 

and persimmons) are the traditional products of the Azerbaijan. 

In 2008 total volume of production of all kinds of fruits and berries 

was 712.8 thousand tons. There is a very substantial potential in 

the fruits and vegetables processing. Both newly established 

enterprises and denationalized facilities stimulate the further 

development of this segment of agriculture. 

Food and Beverages 

The food processing industry in Azerbaijan consists of three 

main segments. These are meat processing, production of dairy 

products and processing and canning of fruits and vegetables. 

Food products are high on the Government’s agenda for import 

substitution. 


95


Annual growth in agricultural sector 

Years 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 

Production, mln USD 824 884 946 1060 1179 1270 1400 1506 1881 2202 2759 3300 

Increase, % -8.8 7.2 7.0 12.1 11.2 7.7 10.2 4.6 7.5 9.3 17.6 16.3 

Production of a number of agricultural products in a last three years 

Products (ths tons) 2006 2007 2008 

Cereals (after peeling ratio) 2078,9 1913,4 2446,1 

Cotton 130,1 95,9 55,4 

Tobacco 4,8 2.8 2,5 

Potato 999,3 1036 1077,1 

Vegetables 1186,4 1219,3 1228,3 

Market garden crops 362,1 412,4 407,7 

Grapes 94,1 95.3 115,8 

Fruit and berries 662,3 674.8 713 

Tea leaves 0,65 0.34 0.34

Peak production of a number of products in Azerbaijan 

Product Peak production, thousands tons Year 

Grape 2,126.1 1984 

Cotton 831.2 1981 

Tobacco 65.2 1986 

Tea leaves 34.5 1988 

Products share in agriculture 


mln. AZN 

97


Although this policy has been relatively successful, and food 

products are declining in prominence within Azerbaijan’s imports, 

there are still significant opportunities in a number of areas. 

Several small businesses are engaged in processing of dairy 

products and a few medium and large companies undertake 

packaging and mass sales. There are twelve large meat processing 

plants in Azerbaijan, mostly in private hands. Forty-three plants are 

active in the canning industry, and although they were previously 

state-owned, most of them are also now private. 

In 2007 total production of foodstuffs including beverages valued 

1457.1 mln AZN. In order to provide markets for local agricultural 

producers there is still a need for substantial rehabilitation and 

renovation of storage and processing facilities. 

Significant opportunities exist in export-oriented agricultural 

production and processing. Azerbaijan’s pomegranate, feijoa and 

grape juices and its olives, hazelnuts and other produce are all 

competitive in international terms. Azerbaijani wine and brandy are 

traditional export products. 

The major markets include Russia, Ukraine and other countries of 

the region. In 2008 the volume of export was 319.4 mln. USD.

Telecoms & IT 

Azerbaijani telecommunications is the second largest recipient of 

foreign investment after the oil industry. The first wave of liberalization 

took place in the 1990’s when a number of foreign investors 

entered the market. The largest FDI stock is in the mobile telephony, 

followed by a number of enterprises with the foreign capital in 

land lines operating companies, internet providers and cable TV 

companies. Foreign investors are represented by Turkish, Israeli, 

UK, Russian, US etc. capital. The sector now is on the verge of 

further restructuring. One of the major steps taken is continuing 

privatization of the state shares in the telecoms and IT enterprises. 

The Azerbaijani telecom market is expanding rapidly. It is one of the 

leading sectors contributing to the economy growth. 125 thousand 

land lines were installed in 2004 only which is above 10% growth. 

Number of mobile telephone subscribers exceeded 6 million in 2008 

and continues to grow rapidly. 

At the present there are 15 telephone sets per 100 inhabitants. The 

similar indicator is 33.0 for Baku city and 5.7 for rural areas. There 

are more than 3 million Internet users in Azerbaijan with a network 

of service providers throughout the country. Further development of 

the telecoms services is underpinned by the construction of Trans- 

Asia-Europe fibre-optic cable. It will give an impetus to introduction 

of new internet related services, international traffic etc. 

There are four mobile operators in the country: Bakcell, Azercell 

and Azerfon with GSM standards and Catel with CDMA standards. 

New GSM operator Azerfon entered Azerbaijani mobile market in 

March 2007. By the end of 2008 the number of subscribers of 

Azercell reached 3 700 000. Coverage area of the network is 80% 

of Azerbaijan’s territory. The capital investments have been made 

by Azercell since 1996 were more than 600 mln USD. In 2007 the 


99


state share in Azercell and Bakcell was privatized. All the above as 

well as the developing legal framework aimed at liberalization of 

the market undoubtedly provides for substantial business opportunities 

for foreign companies with technologies and skills. 

Under the Communications Law, the state has exclusive ownership 

of all radio frequencies. The State Radio Frequencies Commission is 

authorized to issue radio frequency use permits to telecommunications 

businesses. This Commission also prescribes the rules and 

procedures for obtaining such permits and for operating at various 

frequencies. The Communications Law also recognizes the right of 

foreign individuals and legal entities to own and operate networks 

and devices in Azerbaijan. Such devices must be jointly certified by 

the Ministry of Informational Technologies and Communications 

and the Azerbaijan State Standards Agency and their subordinate 

bodies, as well as accredited test laboratories. 

Foreign capital inflow into the telecommunications industry has 

evolved primarily in the form of joint ventures with the entities 

subordinate to the Ministry of Communications, which acts both as 

the ultimate partner and supervising authority. Such joint ventures 

are engaged in the production of telecommunications equipment 

and the operation of telecommunications facilities. However, under 

the Presidential Instructive Order “On the Privatization of Certain 

Enterprises and Facilities of the Ministry of and Communications of 

the Republic of Azerbaijan”, dated 29 March 2001, the Government 

announced its intention to privatize the state-owned share of joint 

ventures in which the Ministry of Communications and its subordinate 

enterprises and institutions have participated. Projects for the 

development of Telecommunication and IT sector of Azerbaijan: 

Preparation and launching of national communication satellite. 

Realization of this project will give an opportunity to use the

facilities of this satellite and has an impact on reduction of cost of 

services. At the same time by realization of this project Azerbaijan 

will be among countries having its own satellite. 

Establishment of regional innovation zone (RIZ). This project aims 

to establish techno-parks that will support innovation entrepreneurship 

within RIZ, regional market on production and export of 

electronic equipment and programs, East-West transit information 

network enabling to render electronic services to regional countries, 

as well as establish a research centre and International 

Information Technologies University. 

“E-Government” (“E-Management”) Academy. This project aims to 

conduct trainings on ICT for the representatives of government 

agencies. 

“E-Government”. The aim of the project is to increase the introduction 

level of ICT in state agencies and using modern ICT to render 

services to citizens. Implementation of this project will enable to 

increase the quality of services rendering to population. 

New technologies—New community (E-Kiosk). This project will 

enable to form electronic services in post offices so that the population 

could use it. 

Establishment of Super Computer Centre. These projects will 

enable to use expert and information system in making a decision 

to ensure operativeness of state agencies (G2G), state-citizen 

(G2C), and state-business (G2B) connections. 

People’s Computer. This project is aimed at computerization of low 

income families by selling high-parameter computers on credit for 3 

year by 3-5% 


101


mln. AZN thousands 

minutes

Construction 

Legislation 

Pursuant to the Presidential Decree “On Measures to Eliminate 

Monopoly and Privatize the Construction Sector”, dated 2 December 

1997, the state monopoly in the construction sector has been 

eliminated, and private persons may now engage in construction 

activities. 

The above measures along with overall economic development led 

to a booming real estate market. A number of local and foreign 

developers are active in the field. The hot spot of the market is 

undoubtedly capital Baku city. The 2004 growth in construction 

sector of 37% is largely attributed to the increasing opportunities 

on this market. It is increasingly competitive though there are 

certainly opportunities for newcomers in luxury apartments, guest 

houses management and international sales areas. 

The main laws regulating construction are the Law “On the Basics 

of City Construction” dated 11 June 1999, and the Civil Code. Other 

legislation regulating construction includes: legislative acts of a 

general nature such as property, land, safety, environmental 

protection, fire and sanitary regulations; construction rules, norms 

and standards; and legislative acts regulating specific sectors 

where structures or facilities are constructed. The construction 

rules and standards of the USSR (GOST and SNIP) are still effective 

in Azerbaijan. 

According to Presidential Decree dated August 31, 2007 toughening 

government control over the country’s construction sector 

Ministry of Emergency situations ensures government control over 

all stages of construction activities across the country, and stops 

construction of the public and residential buildings unless the 

construction regulations in force are observed. The Decree also 


103


gives relevant instructions to the Ministry of Labour and Social 

Protection of Population, the Ministry of Taxes and State Committee 

for Town-planning and Architecture. As for the law “On the 

Basics of City Construction” foreigners and foreign legal entities 

may engage in construction works in Azerbaijan only in conjunction 

with Azerbaijani nationals or legal entities. 

Azerbaijan is a booming construction market. There are several 

reasons behind the rapid development of the business in Azerbaijan 

in the last few years. The major one is the large capital investment 

in local infrastructure related to oil and gas projects. As a result 

this business area has evolved into a very competitive sector with a 

number of strong companies able to deliver the highest international 

standards in construction. 

The sector is growing year by year. Substantial increases in 

business and residential construction have been registered since 

the late 1990s in response to the growth of both commercial and 

household purchasing power. With the grown of demand for better 

living conditions the real estate prices in Azerbaijan are increasing 

on yearly basis. The construction industry has been undergoing a 

large further development. Since 2004 the trend changed in favour 

of residential development. Because the income of the population 

is growing with the state and industry development, the demand 

for new construction has been increasing. 

Therefore, it is highly likely that the proportion of residential 

construction will increase substantially as a result of increasing 

income of population. However, the construction growth is also 

observed in agricultural, transport and industrial sectors, which are 

the results of positive economical reforms and target programs 

carried out by the Azerbaijan government, for developing the 

non-oil sectors.

As market research in the field shows, there are currently significant 

opportunities to introduce state-of-the-art construction 

technology in Azerbaijan, as well as in architectural and engineering 

services, the production of construction materials and so on. 

mln. AZN constructions 


Average number of workers in the construction sector 

Years 2002 2003 2004 2005 2006 2007 2008 

Ths people 178.0 180.0 190.6 194.4 222.8 225.6 226.1 

%, in country’s total population 2.1 2.1 2.2 2.3 2.6 2.6 2.5 

%, in total economically active population 4.7 4.8 5 5 5.6 5.6 5.6 

105


Textile & cotton 

Azerbaijan has a long tradition of production, spinning and weaving 

of cotton and silk. Industrial weaving started in the late 19th 

century. Further industrialization of Azerbaijan in the 20th century 

stimulated rapid development of light industries including textiles. 

The main raw materials for the domestic textile industry are cotton, 

wool, silk cocoons, leather and synthetic fibre. They are produced 

locally in abundance. 

After a period of crisis in the mid 1990s, cotton cultivation has 

increased. The sown area for cotton rose by almost 10% between 

2002 and 2003, to reach 66800 hectares. Output rose by more than 

23% over the same period, to 99500 tonnes. This indicator was 

55,4 ths tons of raw cotton in 2008. More than half of the increase 

was derived from higher productivity. 

The overall potential production of cotton in Azerbaijan is as much 

as 800000 tons from approximately 280000 hectares. This level 

was achieved in mid 1980s with massive capital investment by the 

Soviet government. 

Other raw materials that are also important for the weaving 

industry of Azerbaijan are wool and silk cocoons. In 2008, the local 

sheep stock reached 8 million, and approximately 15 ths tons of 

wool was produced. 

There is a potential to produce over 9,000 tons of silk cocoons 

annually by increasing the area of mulberry plantations to 25,000 

hectares. Normally, 1 kg of silk cloth is produced from 3.5 kg of 

local cocoon (the Japanese standard is 1 kg of silk per 2.8 kg of 

cocoon). So the potential of the local silk industry is 2,600 tons or 

about 18 million m2 of silk cloth (1 kg - 5-7 m2).

There are also opportunities for leather production and processing 

in Azerbaijan as livestock-breeding has been growing rapidly for 

the last few years. 

Markets for Azerbaijan’s textiles, in addition to the local market, 

include Russia, Central Asia and Iran. No export duty is payable on 

such products. Textile products exported to the EU are free of 

quotas and permits, and only the import customs duty is payable. 

Products of Azerbaijan origin attract import duties significantly 

lower than those from other countries. Undoubted comparative 

advantages of the textile industry in Azerbaijan are: 

• cheap labour and low production costs; 

• strong historical traditions in weaving; 

• local raw materials; 

• favorable location; 

• direct access to central asia and the caspian sea region; 

• proximity to large potential markets; 

• the opportunity to locate production in small and middle-sized 

towns of the country; 

• opportunities arising from privatization of state owned textile 

plants. 

Transport & logistics 

Azerbaijan has a relatively developed transport infrastructure. It 

includes about 22,000 km of roads, over 2,000 km of railroads, and 

3 international airports, including the largest one in the region, as 

well as several regional airports. It also has the largest Caspian 

port. The challenges for Azerbaijan include both upgrading of 

existing infrastructure, some of which was poorly maintained in 

1990s, and construction of new infrastructure to reinforce its 

status as a transit point for goods from Central Asia to Europe. 


Total goods transported (1995-2006) 

Years 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 

Ths Tons 83382 92993 80180 92648 98445 110001 117313 128328 145596 167533 183093 

Dynamics % -7.2 11.5 8.6 15.5 6.2 11.7 6.6 9.3 13.0 14.8 9.3 

107


All segments of Azerbaijan’s transport industry are experiencing 

rapid growth. Shipping, for example, has enjoyed an average 

annual growth rate of almost 20% since the mid-1990s. Aviation is 

one of the leading segments, with a cumulative investment 

exceeding 200 mln USD in recent years. Rails transportation is 

growing at a similar pace, largely due to ever-increasing volumes of 

goods in transit across the country. Pipeline transport of oil and gas 

is also expected to grow rapidly over the next few years as largescale 

oil projects come on stream. Total 1242161 thousand 

passengers has been conveyed in 2008. 

The transport sector in Azerbaijan, comprising railway, aviation, 

roads and maritime shipping, amounts for about 7% of domestic 

output. Azerbaijan has taken significant steps to implement 

structural reforms in the transport sector and has implemented 

significant improvements in rehabilitation and construction of 

roads, railways, and other infrastructural installations. In June 

2003 the Ministry of Transport’s functions and duties were 

radically amended to achieve a clear differentiation between 

transport policy and transport operation. This was a significant step 

towards modernizing the transport sector in Azerbaijan. 

Particular attention is being paid to the role of multi-modal transport 

to serve the needs of Euro-Asian logistics. This involves the establishment 

of a favourable transit environment, delivering smooth 

transportation of goods and passengers across the region. Azerbaijan 

stresses the importance of developing efficient Euro-Asian 

trading links as a means of increasing prosperity and improving the 

living standards of the people of all countries involved. All this helps 

Azerbaijan in its effort to integrate into the global economy. 

The Government of Azerbaijan together with the private sector is 

actively involved in the cooperation with international donor

agencies and investors in transport. Such institutions as the World 

Bank, EBRD, EU-TACIS and ADB are active both in the country and 

in the region. 

Azerbaijan strongly supports regional transport initiatives and 

promotes international transit transportation. Its infrastructure 

projects include the construction and rehabilitation of railways, 

highways, ports, and airports. 

The European Union (EU) sponsors development of the transport 

sector through both TRACECA and national projects. The EU goals 

include linking the East-West transport corridor to the Trans- 

European Networks. 

The European Bank for Reconstruction and Development (EBRD) is 

investing in capital projects in ports, railways, and roads, including 

involvement with TRACECA. 

Private investors are currently investigating opportunities for an 

international logistics centre close to Baku, with access to rail, 

road and water transportation. 

The international logistics centre will become the primary hub for 

transport and industry. Investments in the transport sector are 

welcome in Azerbaijan and the country offers a variety of Public 

Private Partnership (PPP) investment models. 

In order to bring Azerbaijan roads up to world standards 

Government invests huge capitals to infrastructure projects (in 

2008 total amount of investments was 1.9 bln. AZN). Only in Baku 

a number of bridges, over- and underground passageways are 

planned to be build. New concrete surface roads using German 

technology, connecting Baku with Russia is under construction. 


Azerbaijan’s active role in 

the establishment of the 

Transport Corridor for 

Europe, the Caucasus and 

Central Asia (TRACECA), 

together with its being the 

base for the TRACECA 

Intergovernmental 

Commission (IGC), is a 

powerful indication of its 

open transport policy. The 

TRACECA IGC, which 

includes in its membership 

Kazakhstan, Kyrgyzstan, 

Tajikistan and Uzbekistan 

(Central Asia), the three 

Caucasian States and 

Bulgaria, Moldova, 

Romania, Turkey and 

Ukraine, was set up to 

promote transportation on 

this corridor, remove 

non-physical barriers, 

establish transport-related 

communication links and to 

promote logistics 

capabilities and multi- 

modal transport. More 

information on TRACECA 

can be obtained via www. 

traceca-org.org 

109


Tourism & Hotel Management 

Azerbaijan is aiming at promoting itself as a new tourist destination 

as opposed to traditional “tourist” countries. It just recently reentered 

the maps of global tour operators. 

Though a comparatively new this business in Azerbaijan proved to 

be particularly successful. This is mainly due to substantial natural 

potential of Azerbaijan in respect of tourism development. The 

natural attractions include: rare climatic and terrain diversity, 

mountains and warm sea, medicinal hot springs, mud volcanoes 

and natural gas flames areas. 

The history of Azerbaijan and the monuments of few civilizations 

and religions add up to the above. The oldest Early Christian 

church, the only operating Fire-worshippers Temple in the world, 

medieval castles scattered all over the country, Old City of Baku 

and Maiden Tower are located here. Baku has the best developed 

infrastructure in the region with modern hotels, resorts, international 

and traditional cuisine, convenient air links to Europe and 

Asia etc. 

The positive impact on the development of tourism in Azerbaijan 

was made by the years of political stability and economic development 

in the last decade. The sector received a further stimulus 

after establishment of the Ministry with the portfolio which includes 

tourism. Consistently grows the number of businesses 

engaged in tourism industry in Azerbaijan. 

Measures by the government play key role in sector’s development: 

After implementation of steps stipulated in the Decree “On Tourism” 

(June 4, 1999) the number of inward tourists increased 

significantly.

Business visits account for the majority of trips to Azerbaijan at the 

moment (the so called business tourism). Simultaneously, there is at 

the same time substantial growth in the outward tourism as well. 

Opportunities exist for the development of regional tours (the so 

called Silk Way Tours in countries of the Central Asia & Caucasus). 

A number of international hotel chains such as Hyatt, Radisson and 

Park Inn already have operations in Azerbaijan. Obviously, the 

potential for development is very high bearing in mind the natural 

and historical attractions of the country. 

The country’s main wealth is its diversity. There are 9 climatic 

zones present with a number of tourist attractions such as sea and 

mountain resorts, mineral and medicinal waters and clays, unique 

Naftalan therapeutic oil, fascinating sceneries etc. 

The capital and the countryside are rich in historical monuments, 

religious shrines of ancient and medieval times. Azerbaijani cuisine 

and rich flavoured wines as well as the widely known Caucasian 

hospitality of the people are the brand of the Republic of Azerbaijan. 

The tourism industry, including hotels, resorts, restaurants aimed 

at the domestic consumer is on the verge of a boom following the 

rapid growth of population’s purchase power. 

Financial sector: banks, insurance & leasing 

Banking system and global financial crisis 

The global financial crisis gripping the world’s financial markets in 

2008 had an effect on foreign investors’ relations with and 

attitudes towards the financial institutions of emerging economies. 

This, in turn, affected Azerbaijani banks’ abilities to draw resources 

from foreign financial markets. Active operations of banks in recent 


Total number of visitors to the country is increasing year by year. 

Years 2000 2002 2003 2004 2005 2006 2007 2008 

Number of visitors (foreigners) 681,000 793,345 1,066,290 1,197,000 1,261,686 1,261,961 1,332,701 1,898,939 

111


years were somewhat supported with foreign financial flows. As 

the terms and conditions of foreign borrowing grew more stringent 

in 2008, the refinancing and liquidity risks also enhanced. Banks 

tended to diversify liabilities from foreign financial markets by 

currencies, purchase, maturity and investors thus managing to 

protect themselves against the growing risks to a certain extent. 

In 2008, the banking system’s portfolio did not experience any 

serious negative changes. In general, the effect of the global financial 

crisis on Azerbaijan’s financial system was more psychological 

urging financial institutions to redefine their development strategies. 

Despite of the unfavorable surroundings Azerbaijan’s banking 

system demonstrated its ability to withstand to emerging risks. 

The risks spawned by the global unstable situation were substantially 

mitigated by the National Bank’s (pursuant to the Referendum 

Act of Marc18, 2009 with respect to amendments and changes to 

the Constitution of the Republic of Azerbaijan, the National Bank of 

the Republic of Azerbaijan has been renamed to the Central Bank 

of the Republic of Azerbaijan since March 31, 2009) timely preventive 

measures. In addition to the preserving the banking system’s 

liquidity the National Bank applied more stringent monitoring of 

commercial banks’ risks. 

Development parameters of the banking system 

Quantitative indicators of the banking system 

The National Bank managed to complete the first phase of timely 

preventive measures aimed at preserving the public trust in the 

banking system step out of the first phase of the global financial 

crisis without losses. Although the banking sector’s indicators 

somewhat stabilized in 2008 as compared to 2007, the pace of 

development was not high.

During the year total bank assets increased by 52.7% (for comparison, 

78% in 2007), equity by 47.8% (93%) and loans to economic 

sectors by 53.5% (98%). The ratio of bank assets to the GDP rose 

from the year-start 25.1% to 27% (ratio to non-oil GDP respectively 

from 70.5% to 69.6%), ratio of equity to GDP increased from 3.8% 

to 3.9% (ratio to non-oil GDP from 10.6% to 10.1%), and loans to 

economic sectors to GDP rose from 17% to 18.4% (non-oil GDP from 

47.8% to 47.4%). 

The enhancing role of mid-sized banks was a major trend in the 

banking system’s development in 2008 (6-15 banks in terms of 

assets). Thus, the share of such banks in the total bank assets 

increased from 21.7% to 23.7%, while the share in deposits grew 

from 22.9% to 26.5%. Larger (top 5 banks in terms of assets) had 

their share of total bank reduced to 62.7% share of total deposits 

from 67.7% down to 61.6%. 


113


Despite of the global financial crisis, foreign investments in Azerbaijan’s 

banking system financed by additional injections from 

owners and new investors increased by 57% thus totaling to 

AZN159 mln as of 01.01.2009 (which equals 16% of the total bank 

equity). Resulting from a change in the number owners, three more 

banks with foreign capital entered the market. 

New shareholders represent countries like the Southern Cyprus, RF 

and Bahrain and considering 3 of them are large stockholders, the 

investors apparently have plans for a long-term presence. As a 

result, the number of banks with foreign capital increased to 23 (21 

bank at the beginning of the year). 

Foreign capital accounted for 29.9% of the total bank assets as of 

01.01.2009 (28.5% at the beginning of the year) and for 26.6% of 

the total deposits (24.1% at the beginning of the year). As of the 

end of 2008, there are 4 representative offices of foreign banks 

(Latvia, France, Germany and Turkey) operating in Azerbaijan, one 

of which opened for business in 2008. 

Two new banks were licensed during the year (one of the newly 

established banks operates in a region), whereby the total number 

of banks in operation reached 46. 

Banks continued to expand their structural networks and improve 

customer access to financial services. Thus the number of bank 

branch offices went up from 485 to 567 and divisions from 94 to 

99. 46% of newly opened 119 banks and non-bank branch offices 

and divisions operate in regions. As a result, the regions also had 

their share of experiencing both quantitative and qualitative 

changes in banking services. While there were 9 financial 

institutions serving every 100,000 people earlier in 2008, at the 

year-end this indicator reached 10.

Significant works continued in 2008 to ensure institutional 

development of the banking system. Pursuant to the Presidential 

Decree of March 1, 2005 “On additional measures to further 

expand the reforms in the financial and banking system of the 

Republic of Azerbaijan”, activities were continued to privatize the 

Joint-Stock Commercial Bank “International Bank of Azerbaijan” 

and Joint-Stock Company “Kapital Bank”. JSC “Kapital Bank” was 

completely privatized in 2008. 

Liabilities of the banking system 

In 2008 the total bank liabilities reached AZN8568.6 mln having 

increased by AZN2941 mln or by 52.3%. The Deposit Insurance 

Fund that started operating in August 2007 further expanded its 

operations in 2008. The compensation on the Fund-covered 

deposits was increased from AZN4000 to AZN6000 in 2008. The 

increase of insurable amount entailed an increase in the deposits, 

which, in turn, had a positive effect on credit resources. 

During the year funds attracted from financial institutions (loans, 

deposits and other resources from other banks) doubled thus 

totaling to AZN3.1 bln as of January 1, 2009. These funds amount 

to 37% of the total bank liabilities (28% as of January 1, 2008). 

Banks’ external borrowings reached AZN2.1 bln during the year. 

The domestic inter-bank market’s share in the total bank liabilities 

remained practically flat during the year (5.2%). 

Structure of bank assets. 

During the reported period the total bank assets increased by 

AZN3547.9 mln or 52.7% totaling to AZN10273.5 mln as of January 

1, 2009. Short-term loans to customers increased by 39.2% while 

long-term loans by 60.8%. As a result, long-term loans increased 

65.6% to 68.7% as a percentage of the total loan portfolio against 


115


the year-start, which is primarily associated with the banks’ 

growing inclination towards investment project financing. During 

the year 51% of the loans were Manat-dominated facilities. 

During the year, loans to the agricultural and processing sector 

increased by 33.6%, to industry and production by 38.8%, and to 

trade and services by 60.1%. Loans to the trade and services sector 

amounted to AZN1910.4 mln as of January 1, 2009, which 

represents 27.3% of the total loans. 

Securities acquired by banks increased by 1.8 times as of January 

1, 2009 thus totaling to AZN747.6 mln. Government securities 

decreased to 39.2% as percentage of the total securities as of the 

total securities as of January 1, 2009 (70.2% as of January 1, 

2008). Banks’ investments in corporate securities increased by 3.6 

times totaling to AZN453.6 mln by the end of 2008, where as debt 

obligations of foreign companies amounted to AZN434.1mln. 

Insurance 

Insurance market is one of the most dynamic sectors of the 

Azerbaijani financial market. Although insurance market is on the 

first stage of its development, according to analysis of financial 

indicators it could be said that growth and development direction 

of the market by and large is on a right path. 

There are two public organizations in the field: The Union of Azerbaijani 

Insurers and Union of Insurance Societies of Azerbaijan. 

Activities are directly contributing to the insurance market development 

and reinforcement of the companies. Seven insurance majors 

are also the members of the Insurance Council established by the 

Ministry of Finance of Azerbaijan. A number of internationals are 

also involved in local insurance market either directly or through 

local companies.

It should be noted that since 1993 Azerbaijan is an associate 

member of international system of automobile owners’ liability 

insurance - “Green Card” and cargo transporters’ liability insurance 

“TIR Carnet”. 

Currently work on fulfilment of normative requirements for 

completing Azerbaijan’s full membership is conducted. 

There are 35 types of insurance products on the Azerbaijani 

insurance market. 9 of them are mandatory insurance and 26 are 

voluntary insurance products. 

Below is the list of products as per the segment of market they 

occupy: 

• Motor vehicle insurance (automobile) 

• Property insurance 

• Cargo insurance 

• Accident insurance 

• Third parties liability insurance 

• Health insurance 

• Life insurance 

• Financial risks insurance 

During the last five years legal framework operation of the market 

has been re-established. In particular the Law “On Insurance”, “On 

mandatory Insurance of Motor Vehicle Owner’s Liability”, Law “On 

Mandatory Fire Insurance of Property”, Law “On Mandatory 

Ecological Insurance” and etc were adopted. Periodic increase to 

the minimum charter capital of insurance companies is aimed at 

consolidation of the market. 

As of beginning of 2008 joint charter capital of Azerbaijani 

insurance companies increased to 63.68 mln AZN. Share of 


117


Azerbaijani capital in this figure is 88% the rest is foreign capital. 

Currently there are 28 insurers, 6 of them are joint ventures, 6 of 

them are with foreign investment. 

Capital market 

The securities market in Azerbaijan is regulated by provisions of the 

Civil Code and a number of presidential decrees, resolutions of the 

Cabinet of Ministers, and acts of the State Committee for Securities. 

The State Committee for Securities, created at the end of 

1998, is authorized to regulate activities on the securities market. 

Under the Civil Code, securities may be issued as registered or 

bearer securities or order papers. In addition, depending on the 

methods of placement, securities are of two types: 

• investment securities, which are placed through separate 

emissions and, regardless of the time of their acquisition, have 

equal rights there under within the respective emission, such as 

shares and bonds; 

• non-emissive securities are placed otherwise and have different 

rights, such as options, warrants, privatization checks, futures, 

mortgage certificates, bills of lading, etc. 

There are two forms of securities: 

• documentary, in which the rights of securities holders to the 

securities are established by a paper document or, in the case of 

depositing securities, by entries in a deposit account. the specific 

requirements for the certificates are determined by the state 

committee for securities; and 

• non-documentary, where the rights of the securities holders to 

the securities are evidenced by the entries made in the shareholder 

register or by the entries made in a deposit account.

Disclosure Requirements 

The Civil Code imposes different reporting and disclosure 

requirements depending on the nature of the placement, with more 

extensive requirements being imposed on an open JSC. 

Regardless of the type of securities placement, the issuer must 

present a report to the State Committee for Securities on the 

results of the issuance and placement of the emissive securities 

not later than 30 days after completing the placement. 

An issuer who has announced a public placement must publish the 

balance sheet and the report on the results of its business in the 

mass media annually. The acquisition of a certain percentage of the 

shares of the issuer by affiliated persons may be regulated by 

anti-monopoly legislation. 

Stock Exchanges 

A stock exchange may only be formed as a closed JSC, and must 

obtain a license from the State Committee for Securities to operate. 

The Baku Stock Exchange was established by the State Committee 

for Securities at the end of December 1999. Shareholders of the 

exchange include banks and investment companies. Baku Stock 

Exchange (BSE) entered 2009 with new opportunities to develop 

domestic capital market together with shareholders and partners. 

At present, it is engaged in trade, depository, clearing, information 

and consulting activities. Stocks, corporate bonds, T-bills, notes 

and repo financial instruments are traded at Baku Stock Exchange. 

Trading floor has 30 broker workstations equipped by computers 

and communication means. Trading session is executed in real time 

regime by the means of Electronic Trading System. Baku Stock 

Exchange holds the license to execute depository activity. 


119


Baku Stock Exchange does not charge fee for depository services 

provided for state securities and has the clearing account in 

National Bank and calculates liabilities of transaction participants 

during the trading session and by the result of trading session 

settles transactions. 

Baku Stock Exchange regularly and operatively refresh official web 

site www.bfb.az, which is available in 3 languages. 

Subscribers for analytical services of Baku Stock Exchange are 

provided with daily bulletins, regular analytical notes, monthly 

reviews and reports on different fields. 

Baku Stock Exchange experts hold regular meetings with potential 

issuers and Investors in order to find best solution for capital 

accumulation and management. 

Baku Stock Exchange is the member of the Federation of Euro 

Asian Stock Exchanges and other international organizations. 

Survey of BSE for January-December 2008 

The total turnover of transactions on all instruments on Baku Stock 

Exchange made 9,519.57 mln. AZN during January-December 2008. 

This indicator exceeds the same one for the analogous period of the 

last year by 173.39%. 

It should be noted that in December the monthly turnover on the 

instruments exceeded AZN 1 bn. making AZN 1,139,749,306.77. This 

is the third time running that monthly volume of BSE exceeds AZN 1 

bn. In other words, the BSE’s turnover on the last quarter of the past 

year amounted to AZN 3,534.510 mln being 37.13% of the exchange’s 

total turnover for that year (please see the table below).

BSE turnover 

mln. AZN 


121


Comparative table on the results of auctions on all instruments on the BSE (January-December, 2008) 

Market segments (31.12. 2008) AZN (31.12. 2007) AZN %, ratio to 2006 year 

T-bills (Ministry of Finance) – (placement) 298,626,604.98 211,785,686.62 141.00% 

T-bills (Ministry of Finance) – (secondary market) 128,214,607.04 30,719,944.02 417.37% 

Notes (National Bank) –(placement) 1,638,204,995.40 1,984,492,653.06 82.55% 

Notes (National Bank) – (secondary market) 453,488,278.62 220,171,294.48 205.97% 

Repo operations 6,761,134,544.68 2,705,229,878.57 249.93% 

Total government securities 9,279,669,030.72 5,152,399,456.75 180.10% 

Corporate bonds – (placement) 32,435,946.50 30,605,900.25 105.98% 

Corporate bonds – (secondary market) 15,348,123.47 14,307,556.29 107.27% 

Stocks – (placement) 173,765,685.36 209,711,596.40 82.86% 

Stocks – (secondary market) 18,353,425.20 83,333,872.63 22.02% 

Total corporate securities 239,903,180.53 337,958,925.57 70.99% 

Total 9,519,572,211.25 5,490,358,382.32 173.39% 

The total turnover of transactions on all instruments on Baku Stock Exchange made 9,519.57 mln. AZN during January-December 

2008. This indicator exceeds the same one for the analogous period of the last year by 173.39%. It should be noted that in December 

the monthly turnover on the instruments exceeded AZN 1 bn. making AZN 1,139,749,306.77. This is the third time running that 

monthly volume of BSE exceeds AZN 1 bn. In other words, the BSE’s turnover on the last quarter of the past year amounted to AZN 

3,534.510 mln. being 37.13% of the exchange’s total turnover for that year. 

For further information please contact Baku Stock Exchange: feedback@bse.az


125 

Headquarters of the State Oil Company of the Republic of 

Azerbaijan (SOCAR) and Heydar Aliyev’s Fundation (right) 

buildings. Baku, Azerbaijan. Photo by Chingiz Samedzade



AZERBAIJAN 

127 

OVERVIEW OF THE 

REGIONS


Absheron economic region 

The Absheron economic region is the largest contributor to 

country’s domestic production. It is situated very favorably on the 

territory of the strategic Absheron peninsula. Terrain consists of 

hills, sub-mountain plain and low mountains. The climate of 

Absheron is of temperate warm, characterized by semi deserts and 

steppes with Absheron-specific winds. Arid subtropical climate is 

typical. Another major factor is that Baku with population of 2.5 

million is located here. 

The region is rich with brick, lime, cement raw material, quartz and 

mason’s sand reserves. Absheron peninsula is also rich with 

balneal resources. It is supplied with water by artificial channels 

from Samur and Kura rivers. 

Gas extraction and petroleum production, petrochemicals and 

chemicals, ferrous and non-ferrous metallurgy, energy, light and 

food industry, R&D are the dominant sectors in the economy of 

Absheron. Construction, transport and services are well 

developed too. 

Construction enterprises of the region produce glass, polymeric 

and other materials. Agriculture of Absheron is of suburban type 

and includes cattle breeding and poultry, vegetables, wine-making, 

flowers and arid subtropical fruits cultivation. 

Climate of the district allows for growing of olives, saffron, 

pistachio and other produce. Infrastructure is well developed. All 

major railways and highways as well as sea and air connections 

pass through the region. Northern shores of the peninsula are a 

major health resort area of Azerbaijan with a number of popular 

beaches.

Aran economic region 

Aran is centrally located in Azerbaijan. More than half of the 

territory of the region consists of a plain below sea level. Mainly 

arid subtropical climate is typical. The region is the traditional area 

of settlement of population. 

The main resources are oil, natural gas, iodide-bromine ore, 

building materials. Abundant solar energy, water reserves of Kura 

and Araz rivers, large land resources are also among natural 

advantages of Aran. 

Manufacturing mainly conglomerates in the south-west (Shirvan, 

Salyan, Neftchala) and north-west (Mingachevir and Yevlakh). 

Chemicals, machinery, light industry and food processing, 

construction materials form the major portion of the economy of 

Aran. There is a number of chemicals production plants in 

Mingachevir, Salyan and Neftchala. Shirvan and Salyan are heavy 

industry centres. 

Cotton weaving (Mingachevir), pre-processing of wool (Yevlakh), 

leather production (Shirvan), carpet weaving (Hajigabul) are the 

key sectors of the light manufacturing. Agriculture is mostly based 

on irrigated farming. 

Aran is situated on the vital transport routes (railways and 

highways) of Azerbaijan. Major connections from Baku to Georgia, 

Iran and Turkey are passing through the territory of the region. 

Yevlakh-Baku air connection is operating. Alat-Astara four-strip 

highway is under construction. It is expected to accelerate 

economic growth and stimulate trade and services. 

There are great opportunities for organization of various production 

including organic honey, tobacco, fruits, green tea, silk and silk 

OVERVIEW OF THE REGIONS 

129


cocoon, juices, tinned goods, leather, asphalt covering, mineral 

waters, furniture, woodwork, ferroconcrete materials and 

constructions, furnishings etc. 

Daglig Shirvan economic region 

Dagliq Shirvan economic region is situated in the central part of 

Azerbaijan. Shirvan plain occupies territory of Agsu, Ismayilli, 

Qobustan and Shamakhi administrative districts. 

The terrain of the economic region splits into the plain and 

mountains. The climate of the region is very diverse. Mountainous 

part has moderately cold climate with plain being hot and dry. 

There are brick, bank stone, sand, loam, detritus and other 

construction materials deposits. The mountains are rich with 

mineral water springs, some of them are thermal. 

Region’s beautiful natural attractions, diverse climate, hot 

medicinal springs, wealth of local traditions in cuisine create 

favourable conditions for development of recreation and tourism 

businesses. Mountainous tourism can also be developed. 

There are also numerous trades, services and public health 

enterprises in the region. 

Dagliq Shirvan is specializing in viticulture, wine making, animal 

breeding. Main emphasis in animal breeding is cattle breeding. 

Traditional handcrafting (carpets) is also popular in the region. 

There are great opportunities in cultivation and processing of a 

number of products such as grapes, grain, fruits and vegetables, 

meat, dairy products, organic honey, as well as various types of 

juice and other preserved food, construction materials, leather,

asphalt, mineral waters, spinning and sewing consumer goods, 

confectionery, furnishings, woodwork etc. Opportunities within 

tourism industry should be emphasized. 

Ganja-Gazakh economic region 

Mild climate, beautiful natural attractions, mineral waters create 

favourable conditions for development of recreation and tourism 

business in this region. There are magnificent Goy-Gol and 

Hajikend resorts 1,500 m above sea level. Naftalan is world famous 

for natural medicinal oil. 

Ganja-Gazakh is the second largest economic power in the country. 

The region gives 12-13% of the total output. Industry consists of 

processing and manufacturing. Metallurgy is largely located in 

Ganja and Dashkasan. 

Heavy manufacturing holds leading position. Other sectors are 

automotive, agricultural machinery services, telecoms. Agricultural 

produce forms the supply base of the region’s light industry. 

This region gives 13-14% of total agricultural production, 80-85% of 

potato, 28% of grapes and 15% of animal breeding of Azerbaijan. In 

Ganja and Gazakh the major sectors in agriculture are potato, 

grapes, grain, vegetables and fruits. 

Cotton is cultivated in Goranboy, Gazakh and Agstafa. Shamkir and 

Samukh are specializing in grapes. Gadabay, Shamkir and Tovuz are 

leaders in potato and Goranboy is specializing in grain. Gardening, 

fruits and animal breeding are also the rapidly growing segments 

of the local economy. 


131


Guba-Khachmaz economic region 

The region is located in the north-east of the country and borders 

Russia in the north. It has long coastal line with the Caspian Sea. 

The main sectors of the region’s economy are agriculture and 

manufacturing. Tinned fruits and vegetables production (Khachmaz, 

Guba), fish processing (Khudat), carpet weaving (Guba, Gusar, 

Khachmaz) are the region’s specialties. 

Grain and dairy products constitute major products in Khachmaz 

and Devechi. Heavy industriey is represented by oil and gas 

production (Siyazan), electronics plant (Guba), swarf processing 

(Khachmaz). 

Main resources of the region include oil, natural gas, shale oil, 

sand, gravel, clay. The region has dense river network and large 

water reserves. As the region is one of the significant sanatoriums 

and spa areas the recreation potential is substantial. 

Regionally famous Nabran recreation area is located here. 

Communication lines connecting Azerbaijan with Russian 

Federation pass through this region. 

Lankaran economic region 

Lankaran economic region is located in the southeast of Azerbaijan 

with territories of Yardimli, Jalilabad, Masalli, Lerik, Astara and 

Lankaran administrative districts included. The economic region 

boarders Caspian Sea in the east and Iran in the west and south. 

Territory of the region consists of two major parts: Lankaran valley 

and Talish Mountains. The region stands out among other 

economic regions due to the fact that 7 climatic zones from overall 

11 are present here.

The region is rich in brick, bank stone, sand, loam, detritus and 

other construction materials. It also has plentiful thermal medicinal 

springs. The main natural resources of the region are forests along 

the flank of hills and fertile land. 26% of the region’s area is 

covered with forests. There are few unique and rare specimens of 

flora such as shumshad, damiragaj (iron tree), oak with chestnut 

leaves and others. 

Processing of the agriculture products is one of the principal 

sectors of Lankaran’s economy. Humid subtropical climate, fertile 

lands, abundant rainfall and sufficient workforce amount for great 

opportunities to develop agriculture up to the most modern 

standards. Priority directions are growing of tea, citruses, 

vegetables & fruits as well as winemaking. 

Baku-Astara railway and Baku-Astara highway parallel to the 

former are the major transport routes. The North-South Transport 

initiative that is expected to boost regional trade along Iran- 

Azerbaijan-Russia-Northern Europe route will pass through the 

region. A modern airport is located in Lankaran town. 

It is possible to develop ecotourism, restaurant business, fitness & 

entertainment centres in the region. Mountainous tourism 

can also be developed. Bearing in mind that neighboring Iran with 

population of 72 million has no a sufficient number of modern 

tourist resorts it is appropriate to develop all sectors 

of tourism locally. 

Nakhchivan economic district 

Nakhchivan economic region consists of the territory of the 

Nakhchivan Autonomous Republic surrounded by Turkey, Iran and 

Armenia. The main trademark of Nakhchivan is it”s location on the 


133


historical trade routes connecting East and West. 32% of the 

territory is 600-1,000 meters above sea level, 48% is above 2,000 

meters above sea level. Climate is continental and arid. The region 

has the autonomous status within Azerbaijan with a local 

government and parliament. 

Nakhchivan is rich in molybdenum, complex ore, rock salt, dolomite, 

marble, construction materials. Also there are more than 200 

valuable mineral water springs such as Badamli, Sirab, Vaykhir and 

others. 

The key sector of the economy of the region is production and 

processing of farming produce. Famous sheep breed Balbas is the 

local specialty. Beekeeping is also developing. 

The transport system of the economic region allows freight through 

the territory of Iran, road connection with Turkey and via 

international Nakhchivan Airport. There are unique tourism 

attractions on the territory of the region such as Ilandag, 

Ashabulkef, Nahajir blister (volcanic) cones. 

Sheki-Zagatala economic region 

Shaki-Zagatala economic region is located on the South flank of 

the Great Caucasus, in the northwest part of Azerbaijan. This is 

one of the most beautiful parts of the country. 

The district borders with Russia in the north-east and Georgia in 

the north-west. Height varies from 100 m to 4,466 m (Bazarduzu 

peak) and the climate is diverse. 

Copper mines, 90% of sulphur-pyrites, 97% of lead, 99% of zinc in 

Azerbaijan are in this economic region. Filizchay ore considered to 

be a unique field in the Caucasus. It may boost metallurgy and

chemical industry locally. There are also raw construction materials 

such as sand, gravel, stone, loam, etc. 

The key sector of the economy of the region is agriculture. Fertile 

land, abundance of water and workforce create great opportunities 

for development. Agriculture consists of tobacco, silkworm 

breeding, fruits, grain, and viticulture, sheep breeding and dairy 

production. Light and food industries are dominant. 

Business opportunities in tourism should be noted in particular. 

Shaki and Zagatala are also major tourist attractions due to their 

historical and natural attractions. 

Yukhari Garabag and Kelbajar-Lachin economic regions 

Territories of Lachin, Kalbajar, Zangilan, Gubadli, Khojavand, Khojali, 

Shusha, Jabrayil and Khankendi are completely, territories of 

Agdam and Fuzuli are partially under Armenian occupation. 

In both regions the key sector of economy is agriculture. Major 

sectors in agriculture are viticulture, grain growing, fruits and 

tobacco raising as well as pastoral cattle breeding. 

Mineral resources include large deposits of precious metals 

(gold) and thermal springs, mercury, marble, building stone, 

copal, perlite. 


For further information, 

please refer to the 

Department on Regional 

135 

Development Policy and Work 

with Regions: 

www.economy.gov.az


Economic regions of the Republic of Azerbaijan 

Absheron Aran 

Agdash, Aghjabadi, Barda, Beylagan, Bilasuvar, 

Geoychay, Hajigabul, Imishli, Kurdamir, Neftchala, 

Saatli, Sabirabad, Salyan, Ujar, Zardab districts; 

Admin units Sumgait city, Absheron,Khizi districts 

Mingachevir, Yevlakh and Shirvan towns 

Total area, thousand sq km 3.29 21.43 

Share in country’s total area 3.9% 24.7% 

Population (01.01.2009), thsnd 512.8 1792.3 

Share in total population 4.8% 20.5% 

Workforce, thousands 171.9 948.4 

Population density, per sq km 125 82 

Key sectors of economy manufacturing and a/c production manufacturing & agriculture 

Major products olives, meat cotton, grain, wine, arid subtropical fruits 

Ganja-Gazakh Guba-Khachmaz 

Admin units Ganja, Agstafa,Dashkasan, 

Gadabay, Goranboy, Naftalan, Goygol, Gazakh, 

Davachi, Khachmaz, 

Samukh, Shamkir, Tovuz districts 

Guba, Gusar and Siyazan districts 





Workforce, thousands 203 268.3 


Key sectors of economy processing and manufacturing a/c production & tourism 

Major products grapes, grain, fruits, tobacco vegetables, fruits, grain

Daglig Shirvan Sheki-Zagatala Lankaran 

Agsu, Ismailli, Gobustan and Shaki, Zagatala, Gabala, Oguz, Astara, Jalilabad, Lerik, Masalli, 

Admin units 

Shamakhi 

Gakh, Balakan districts Yardimli, Lankaran districts 


Share in country’s total area 14.4% 7% 



Workforce, thousands 387.8 387.8 


agriculture, food processing, 

Key sectors of economy 

industry agriculture, tourism a/c production 

grapes, wine, vegetables, fruits, tobacco, silkworm, fruits, grain, fruits & vegetables, tea,citruses, 

Major products 

meat grapes, meat and dairy production 

grapes, dairy produce 

Nakhchivan Yuxari Garabagh & Kelbajar, Lachin 

Agdam, Tartar, Khojavand, Khojali, Shusha, Jabrayil, 

Nakhchivan city, Julfa, Sharur, Ordubad, Babek, Fizuli districts, Khankendi town and Kalbajar, Lachin, 

Admin units 

Shahbuz, Sadarak and Kangarli districts 

Zangilan, Gubadli districts 






Workforce, thousands 143.1 


Key sectors of economy agriculture, food processing agriculture, animal breeding, beekeeping 

Major products tobacco, fruits grain, grapes, silkworm grapes, grain, fruits, tobacco 

137


139 

Ilan Dag mountain. Nakhchivan region. Azerbaijan.



AZERBAIJAN 

141 

GENERAL 

INFORMATION


Living & Working in Azerbaijan 

“Khosh Gelmishsiniz” - Welcome to Azerbaijan! Hospitality is one of 

the special talents of the people of Azerbaijan. Whoever travels to 

the South Caucasus - and especially to Azerbaijan - will leave 

deeply impressed by its hospitable people. Walk around anywhere 

in rural Azerbaijan and you will be immediately invited by a friendly 

family to have “cay” (tea) in their home. Of course, such an 

invitation is less likely when walking down the streets of modern 

boomtown Baku, but nevertheless the hospitable attitude of the 

Azerbaijani people can be felt everywhere. Therefore you will have 

no difficulties to feel “welcome” while being here. 

For most expatriates, living and working in Azerbaijan means living 

and working in Baku and “Absheron” (the peninsula on which the 

two biggest cities of the country Baku and Sumgayit are located). 

The European look and feel of the modern city centre of Baku is 

quite a surprise to most visitors. But there is a lot of history to 

discover – as the face of Baku has over the centuries been 

influenced by many different cultures. That is also why the city 

centre of Baku is a very unique mixture of ancient and modern 

architecture, ranging from 11th century Caravansarays (kind of 

combined motels cum marketplace for ancient trade caravans) to 

Belle Époque Mansions build by Oil Barons in the 19th Century and 

the whole bouquet of Soviet Architecture. In some of the streets 

you will feel like in Paris, in others like in an old desert village on 

the Silk Road and in some corners like in Moscow or East-Berlin. 

However, despite almost 3 Million inhabitants, Baku has kept its 

cosy small town flair. 

This particular flair has however been recently distorted by the 

unprecedented construction boom which has taken over half the 

city. Standard twenty-storey office and apartment buildings are

mushrooming everywhere and endanger the architectural heritage 

of the city. Prices for building material and real estate have 

skyrocketed in the last two years. When renting an apartment, you 

should expect prices comparable to other European capitals. 

The living standard for an expatriate in Azerbaijan has been 

improving steadily since the late nineties. Nowadays, you can get 

almost all mod cons from fitness centres to whole–grain bread. The 

infrastructure - especially on Absheron - has been substantially 

improved in recent years. Mobile telecommunication coverage has 

reached 95% of the country and wireless high speed internet 

access is available throughout the city of Baku. The national road 

system is currently under construction and considerable 

investments are also being made in the power and energy sector. 

Water and waste water infrastructure is planned to be upgraded in 

the near future as well. The many power cuts that were common 

until recently, are now history. Only in the rural regions can you 

sometimes still experience difficulties. 

There is a whole range of restaurants offering a feast of fresh and 

healthy dishes prepared with tasty greens, vegetables and of 

course meat from the foothills of the Caucasus as well as delicacies 

from the Caspian Sea like sturgeon and caviar. 

The available international cuisine ranges from Japanese, 

Malaysian, Chinese, Indian, German, English Pub Food, Georgian, 

Russian, Italian to Lebanese and many more. But you can also 

indulge in the wide variety of kebabs and local “Plov” (rice dishes). 

The Azeri cuisine is extremely rich and eating plays an important 

social role in everyday live. As a guest you will get invited more 

than once to a typical Azeri dinner or wedding, which will confront 

you with mountains of Lucullan treasures. 

GENERAL INFORMATION 

143


Culture is an important ingredient of entertainment for the 

Bakuvites. A turn-of-the-century Opera house and a Philharmonic 

Concert House regularly host international and regional events. The 

Baku-Jazz-Festival has become an international event - featuring 

major international artists like Al Jarreau, Aziza Mustafazadeh, 

Herbie Hancock and many others. 

Baku is a relatively safe city. It has one of the lowest crime rates of 

all member countries of the Council of Europe. Walking around in 

Baku is therefore safer than in most other big cities in Western 

Europe. Of course, you should avoid unknown places after dark and 

not display a lot of cash openly in public. 

Dress code for men is long trousers at any time and temperature of 

the year, whereas women can wear any fashion without any 

problems. In Baku you will see mini-skirts next to traditional female 

dresses. 

Although English and other foreign languages are now studied by 

the younger generation, do not expect to get by without the 

knowledge of basic Azeri or Russian. 

The health care system is still undergoing complex reform efforts. 

Especially in the rural regions of Azerbaijan, medical services are 

very basic. In Baku, facilities with modern equipment and 

internationally trained doctors are available. 

Minor operations can be conducted according to European 

Standards in Baku. For complex and long term treatments, there is 

still a lack of capacity. 

German-Azerbaijan business relation date back over 200 years and 

have traditionally been friendly. The Siemens brothers were among 

the first international entrepreneurs that invested in Azerbaijan:

first into the mining sector and later in Telegraphy and Electricity/ 

Power generation. Today, the German industry is already active in 

many sectors, but wants to intensify the relations by supporting 

especially the non-oil sector. 

The non oil sector is playing a vital role for securing the 

sustainability of the wealth of the Azeri people in the future. 

The German–Azerbaijan Business Association (DAWF) comprises 

nearly 100 German/Azerbaijani Companies and has over the past 10 

years become the primary hub of business relations between the 

two countries. Among many other activities, the DAWF organized 

extensive business networking events for the visit of President 

Aliyev to Berlin in February 2007 and hosts a number of high level 

German-Azerbaijan Business Events each year. 

The DAWF represents the German-Azerbaijani business community 

and is a comprehensive network for establishing and expanding 

any business activity in Azerbaijan. Personal contacts are a 

decisive success factor for doing business in Azerbaijan. Some 

unwritten DO’s and DON’T’s exist, which should be understood 

beforehand by talking to fellow business men, who have been 

around for some time. 

A steadily growing number of German companies contact the 

DAWF for support in establishing a co-operation with Azerbaijani 

companies or simply to become part of the German business 

network. The member companies come from a wide range of 

branches such as industrial services, finance, construction, 

communication, consulting, medical and pharmaceutical, logistics, 

machine building and the public sector. 

The DAWF provides support to the members and non-members by 


145


assisting them in the first steps, like analyzing market potential, 

searching for business partners and looking for qualified 

employees. 

The DAWF also receives inquiries from Austria, Switzerland and 

other European Countries. The successful co-operation with the 

Ministry of Economic Development, the Azerbaijan Export and 

Investment Promotion Foundation (AZPROMO) and many other 

Ministries contribute to a professional exchange of information. 

The DAWF actively informs the business community in Germany 

about business opportunities in Azerbaijan. 

No matter whether you come to life and work in Azerbaijan or 

simply as a guest, you will enjoy many unique hospitable moments 

on an old by-road of the ancient Silk Road. In Azerbaijan, you can 

traverse cultures from (Central) Asia to (Western) Europe within a 

couple of kilometers and from modern times of Globalization to 

medieval and ancient times of history. 

Between the Caucasus and the Caspian you will encounter a young 

country opening up to the global economy, with the currently 

highest GDP growth rate in the world. You will find beautiful and 

diverse landscapes, wonderfully peculiar sights like mud volcanoes 

and candy-cane colored mountains, and, most importantly, friendly, 

hospitable, open-minded and tolerant people keen on making your 

stay in Azerbaijan enjoyable. 

Khosh Gelmishsiniz! 

—Florian Schroeder 

Managing Director 

German-Azerbaijani Business Association (DAWF) 

schroeder@dawf.com

Labour market 

One of the major comparative advantages for selecting Azerbaijan 

as a place to do business with is its competitive labour market. The 

total workforce in Azerbaijan accounts for approximately 5.6 million 

people. The literacy level of circa 98% and number of people with 

higher and professional education (exceeding 1.2 million) 

undoubtedly add up to the point of Azerbaijan being an extremely 

competitive employment market. 

Azerbaijani labour is multilingual. Apart from Azerbaijani one can 

expect a local employee to speak Russian and Turkish. Azerbaijan is 

also one of the most successful examples of how English is 

spreading in the working environment. English is slowly but surely 

becoming the “office” language at least in Baku. 

There are 44.4 thousand officially registered unemployed with 

apparently more unemployment being unregistered by statistic 

authorities. 

Visas & Work Permits 

In order to enter Azerbaijan a foreigner normally should obtain a 

visa. There are few categories of nationals with different visa 

regime. CIS country nationals (apart from Turkmenistan) do not 

require a visa. In order to enter Azerbaijan they need to present at 

the border a valid passport. All the other nationals will need a visa. 

Visas are obtainable at the Azerbaijani Embassies and Consulates 

abroad (see the list of Azerbaijani Embassies abroad further in this 

publication). 

There is a back up mode of obtaining a visa at Baku Heydar Aliyev, 

Ganja and Nakhchivan International Airports. There is a visa 

section at the all three International Airports. The visa one may 


Azerbaijan’s labor market 

Years 2003 2004 2005 2006 2007 2008 

Employed, ths 3,747 3,817 3,850 3,973 4,014 4056 

Average wage in AZN 76.61 96.68 117.9 141,3 214.0 274.4 

Registered unemployed 54,365 55,945 56,343 53,862 50,651 44,481 

147


obtain is short term and it is strongly recommended to have your 

visa issued in advance. The following documents are required in 

addition to payment of the duty: 

• one copy of the completed visa application form (application 

forms may be photocopied); 

• two pieces of photos (3x4) for an application form. 

Single entry visas are normally valid for three days to three months 

period. Multiple entry visas are normally up to one year with 

unlimited number of entries. If the visa has not been used within 

the period of validity stated it becomes invalid. 

An exit visa is provided to foreign national who has an official 

permission to live on the territory of the Republic of Azerbaijan and 

obtains this type of visa upon leaving the country. 

A return visa might be given to foreigners who have a personal 

passport if they apply for it when leaving the Republic of Azerbaijan 

to return for a period of up to one month. This visa becomes invalid 

if not used within six months from the date of exit from the 

Republic of Azerbaijan. 

A single or multiple transit visa is granted to foreigners going to 

other countries but passing through the territory of the Republic of 

Azerbaijan. If the transit visa has no notes or seals about non-stop 

passage, the bearer has the right to stay in the Republic of 

Azerbaijan for no longer than five days. 

Foreigners wishing to prolong their visas in order to stay longer in 

the Republic of Azerbaijan must do so in advance, before the 

expiration of the period indicated in their current visa. The 

following documents must be submitted to obtain a visa from the 

Consular Department of the Ministry of Foreign Affairs of the 

Republic of Azerbaijan in Baku:

• a letter from the receiving side; 

• one copy of the completed visa application form (application 

forms may be photocopied); 

• original passport or a substitute for a passport of a foreign 

national who is applying for a visa (no copies accepted); 

• two pieces of photos (3x4) for an application form. 

• receipt for the payment of duty; 

A foreign citizen wishing to stay in Azerbaijan for more than a 

month should register with the local police authority at the place of 

residence. Please see Annex 9 for consular fees payable for 

Azerbaijani visas. 

Who needs work permits and how to obtain it. A foreign national 

who comes to Azerbaijan with intention to work here, have to 

obtain a work permit. The permits are issued by the Ministry of 

Labour and Social Protection. Work permits are issued for one year 

period. The term of validity can be extended for another year, but 

no more than 4 times in a row. 

The following categories of foreign nationals do not require work 

permits: 

• Permanent residents, entrepreneurs, management of companies 

established through international agreements, staff of diplomatic 

missions, staff of international organizations, businessmen (no 

more than for 3 month period), persons employed by relevant 

executive authorities, persons engaged in religious activities 

provided by religious organizations registered by the 

Government, accredited staff of mass media, sailors, sportsmen 

and artists, researchers and professors at the universities. 

The following documents must be submitted to obtain a work 

permit from the Ministry of Labour and Social Protection of 

Population (MLSPP): 


149


• application (can be received from the MLSPP); 

• copy of the license issued to the Employer; 

• copy of the document verifying that foreign employee is able to 

undertake activities. 

Business etiquette 

Appointment and Meetings 

Arrange appointments in advance. Try to do so via telephone and 

confirm it with a letter or an e-mail. It is a very good idea to call on 

the day or the day before to check that it is still convenient. Local 

business people only take very seriously those appointments that 

are reconfirmed. The dynamics of business life means that people 

at senior level tend to change their schedule at short notice. 

Although Azerbaijanis do not practice time keeping and punctuality 

perfectly, they will expect you to do so. If you do arrive on time it is 

not uncommon for you to be left waiting while a previous meeting 

is wrapped up or a telephone conversation is taking place. You may 

have to wait but you will almost certainly have the meeting. So try 

to leave plenty of time between meetings to allow for slippage. 

A shock to many visitors is how long it takes to move around the 

city. Baku is quite compact and the centre in particular is well 

suited to walking although the sidewalks, steps and pedestrian 

areas are not very well paved and one needs to look where you are 

walking. But in a car, travelling in and around Baku is an 

increasingly time consuming and frustrating activity. 

The number of SUVs, cars and buses on the city’s streets is rising 

at an alarming rate. The city’s streets are narrow, not well surfaced 

generally, and there is no provision made for off-street parking. 

Finding a place to park can be a real challenge. In addition, Baku is 

in the process of being rebuilt and construction activity is at every

turn. Business visitors are advised to leave plenty of time to travel 

from one place to another. Baku drivers are also slightly erratic if 

compared with most western driving standards. 

Business hours are 9:00 a.m. to 1:00 p.m. and 2:00 p.m. to 6:00 

p.m. Monday to Friday. Government departments and agencies 

usually work Saturdays too, at least until lunch time. Shops and 

restaurants are generally open seven days a week. 

The business community tends to work quite long and rather 

variable hours. Lunch can be taken as early as 12:00 pm (mainly by 

the oil sector) and as late as 3:00 p.m. Many managers work later 

than 6:00 p.m. Most Azerbaijanis eat early in the evening rather 

than late. 

Factors and events affecting the working routine 

Azerbaijan is a secular state but approximately 80% of Azerbaijanis 

follow Islam. Muslim prayer times impinge relatively little on the 

typical working day. However, during the Holy month of Ramazan 

(which changes every year) many Azerbaijanis fast from dawn to 

sunset and then break their fast immediately after sunset by having 

a meal [Iftar]. Managers need to be aware of this as it can affect 

the normal working routine and heighten staff eagerness to leave 

the office in time to have their first food (and drink) since before 

dawn. Fasting is growing in popularity each year, especially 

amongst young adults. 

A time to avoid travelling to Azerbaijan on business, or at least to 

check first, is during July and August since many Azerbaijani 

businesspeople take extended vacations to spend time with family 

in their holiday homes or, increasingly, abroad. 

Azerbaijan has many secular and Islamic holidays and one day of 

mourning. The 2010 calendar is: 


151


• January 1-4 – New Year 

• January 20 – Martyr’s day (Day of Mourning) 

• March 8 – Women’s day 

• March 20-24 Novruz Bayram 

• May 9 – Victory day 

• May 28 – Republic day 

• June 15 – Salvation day 

• June 26 – Army day 

• September 9-10 – Ramazan Bayram 

• October 18 – Independence Day 

• November 12 – Constitution Day 

• November 17 – The Day of Revival 

• November 16-17 – Gurban Bayram 

• December 31 – The Solidarity Day 

Major holidays are December 31 to January 5 (incl.) to celebrate 

Solidarity of all Azerbaijanis and the international New Year, and 

Novruz Bayram over March 20-24 (Muslim New Year) in 2009. 

In addition to these Azerbaijan has one day of mourning on January 

20 in remembrance of hundreds of Azerbaijanis massacred by 

Soviet troops in 1990. All businesses, shops and even TV and radio 

will be closed down or with sombre programming for at least the 

first half of the day. (Warning: try not to offend anyone by referring 

to this day as a holiday). 

The Islamic holiday of Kurban Bayram (November 27-28 in 2009) 

falls on different dates each year due to the lunar cycle. This 

Islamic festival is a ‘sacrifice festival.’ Marking the end of the 

pilgrimage in Mecca, Saudi Arabia, it is based upon the Quranic 

story of Abraham’s willingness to sacrifice his son for God. A day or 

so the festival you may see a sheep or a cow bought by families 

and tied up outside apartment blocks or living on balconies until

the day arrives. The animal is then slaughtered and the meat 

distributed among the family, neighbours and the poor. The festival 

is more widely celebrated in the regions than in Baku, and in the 

outskirts of the city rather than the city centre. 

Ramazan ends with the festival known as Ramazan Bayram. 

Families would visit each other and children would receive 

presents, sweets or money. 

Business communication 

Azerbaijan’s official language is Azerbaijani (Azeri) and all state 

documentation is in the Azeri language. Russian is widely known 

and spoken but most official meetings will be conducted in Azeri. 

Many Azerbaijani businesspeople have a good command of English 

and the vast majority of young people speak English to some level, 

especially those who work in foreign companies. In general, the 

knowledge of the English language is proficient. Other international 

languages spoken include French, Italian and German, but more 

usually by those in businesses that are specifically oriented to a 

particular country. If you are unsure as to your counterpart’s 

linguistic capability, it is may be worth investing in an interpreter 

so as not to appear to take it for granted that the person you are 

visiting will be able to communicate in your language or provide an 

interpreter. Remember to slow your speech down and to speak 

clearly. Always confirm meanings, conclusions and agreements. 

Rather than ‘get straight down to business’, engage in some small 

talk and always wait for the other to initiate the change in topic. 

At most meetings the person you are visiting will offer you tea or 

sometimes coffee. Often tea (Chai) will be served automatically by 

an assistant and delivered to the meeting table. It will usually be 

served in tulip shaped glasses with lemon slices and wrapped 


153


sweets or chocolates are often provided. Many Azerbaijanis serve 

tea but sometimes chose not to drink theirs but are pleased if you 

drink yours. It is done as a courteous act of hospitality. 

Sugar may not be offered as many Azerbaijanis prefer to sip their 

Chai and eat something sweet to accompany the drink. If sugar 

cubes are offered you may find your host places one in his mouth 

and drinks his Chai through the sugar cube. He will not expect you 

to do the same unless you wish to. 

Business Dress Code 

Business dress is always conservative but varies slightly with the 

seasons. Men generally wear suits or jackets and ties. Similarly, 

women should wear smart professional outfits. In the hotter 

weather (and temperatures can regularly reach over 27 degrees in 

summer months), men usually switch to short-sleeved shirts with 

or without ties. Light colored summer suits are also acceptable. 

The oil sector, especially foreign companies, adopts rather more 

informal standards. Shorts are not advisable either at work or 

socially. 

Outside Baku, and especially in the regions, while men’s dress code 

remains the same, women should wear more conservative clothing. 

Women are advised to refrain from high fashion and many women 

might find that they feel more comfortable in longer skirts or 

trousers. No shorts. At the beach, normal beach wear is worn by 

Azerbaijanis and foreigners alike. Topless bathing is not allowed. 

When visiting a mosque, bear in mind that it is a place of worship. 

Never enter a mosque with shoes. There is always a rack where 

shoes can be kept. Make sure your feet are clean and will not bring 

in dust or mud. Men should not wear shorts and must wear a shirt

or t-shirt. Women should be covered fully, especially their hair. If 

you do not have a shawl or head-dress, ask an attendant, as some 

are usually put aside for foreign visitors. 

If you are invited to someone’s home, you may find that you are 

offered the opportunity to take your shoes off and wear slippers. 

Most Azerbaijani families always remove their outdoor shoes when 

entering the home. 

Welcome Topics of Conversation 

At initial meetings, it is a good idea to get to know your Azerbaijani 

counterpart on a personal level. 

Ask about his/her family without prying. Questions about children 

will be welcomed. Find out about their work, role and company. 

The Azerbaijanis are proud of their country and will enjoy answering 

questions on their culture, climatic zones (of which they have 

nine), picturesque countryside and their ancient history—although 

be sure to avoid more modern political history. Azerbaijanis follow 

international current affairs and will usually be opinionated. 

Topics to Avoid 

Avoid giving opinions over sensitive issues involving Armenia, 

especially the war over Nagorny Karabakh and the protracted 

efforts by the OSCE Minsk Group to find a solution to the conflict 

(which remains is a state of cease fire). Azerbaijan has had a 

turbulent political history which may be best left in the past. 

Try and avoid this subject as a whole. 

Unless you know the subject well and have a good understanding 

of local sensitivities, you are advised to avoid discussing religion. 

Islamic values of Azerbaijanis vary from person to person and one 

needs to know your counterparts views before discussing this 


155


topic. In general, it is wise to be careful as to how you approach 

any topic about Islam. 

First Name or Title? 

When addressing an Azerbaijani, especially middle aged or older 

men, the most common method is to call a man by his first name 

followed by ‘muallim’ [pronounced mallim]. So, Emil Hasanov would 

be Emil Muallim. Similarly a woman’s first name would be followed 

by ‘Khanum’ [pronounced ha-num]. Muallim and Khanum are 

Azerbaijani for ‘Teacher/Mr’. and ‘Madame/Miss/Mrs’ respectively. 

In official letters men should be addressed as Janab and women as 

Khanum. For example, Hormetli Canab Emil Hasanov, or Hormetli 

Aygun Kazimova. Hormetli means ‘respected’. 

Gift Giving 

Gift giving has no real place in business relationships or etiquette. 

Relationship building and the like will usually take the form of 

dining or sight seeing trips rather than lavish gifts. 

However, if a gift is given it will be accepted graciously. It is always 

a good idea to bring gifts from your own country. Small craft items 

are always well received. 

Be aware that Azerbaijan is a Muslim country. Before giving 

alcohol to anyone, be 100% sure that they drink. 

The only time you would need to give any great thought to gifts 

would be if you were invited to an Azerbaijani’s home for dinner. 

Decorative items for the home such as ornaments, vases or small 

pictures are always acceptable. Flowers are not usually taken to a 

host, but can be if felt appropriate. It is best to ask a florist for 

advice on what is best to take. If the host has children, take some 

expensive sweets or biscuits. Note: Flowers must always be given

in odd numbers. Azerbaijanis associate an even number of stems 

with death. They would buy ten lilies to lie on a grave, for example. 

So, a dozen red roses given in admiration in Europe or US would 

need to be 9 or 11 in Azerbaijan. 

Making a Deal 

Always come to Azerbaijan with two things clearly in mind. Firstly, 

your success will in most part depend on your ability to build 

effective personal relationships, and secondly, you will need to 

have well defined goal backed up with means to perform. 

Business remains personal in Azerbaijan, although a more 

corporate culture is developing led by the foreign oil companies. 

But even in those companies it’s often a matter of whom, rather 

than more that what you know. Many smaller Azerbaijani 

businesses and several groups of companies are family owned and 

run. It is not unusual to find several relatives in one business or 

group of companies. 

Azerbaijanis will want to do business with those they like, trust, 

feel comfortable with and with those who can initiate a long term 

relationship. If they feel you are hiding something or there is an 

element of suspicion about your motives, you may not get very far. 

Building a relationship with your Azerbaijani counterpart[s] is 

therefore critical. The first meeting is often a matter of getting to 

know each other and introducing the subject. Once a relationship 

has been established you can safely move on to more detailed 

business matters. It may take several meetings to achieve real 

progress. 

As well as looking to the person, Azerbaijanis are also astute 

businesspeople. Ensure your proposal clearly demonstrates the 


157


mutual benefit and profitability of any agreement or partnership. It 

is also very important not to underestimate the business acumen 

and position of your counterpart. Whilst he or she may not have 

had (and often cannot have had) the years of experience you may 

possess, they will not welcome visitors suggesting how they should 

run their business. Remember, you may need them a lot more than 

they need you. 

Azerbaijanis are primarily oral and visual communicators, so in 

addition to written statistics, projections and the like, try to present 

information vocally or with maps, graphs and charts. 

Decision making can be slow. It is often the case that you will be 

directed to meet and negotiate with less senior members of staff 

from the outset or after an initial introduction. If this happens don’t 

read anything negative into it. Once it is reported to the very senior 

management that you are seen as trustworthy, reliable and that 

your proposal is financially viable, you will then move on to meet 

more senior members. Almost all decisions in business in 

Azerbaijan are made at the very highest levels of the company (or 

government structure). 

Azerbaijan has a long history of trade dating back to the ancient 

times. They are canny negotiators. They will usually start off very 

demanding gage your response. Prior to negotiations know your 

target figure and work slowly towards it through meaningful 

concessions. When conceding, it may help to ensure that you 

present this as much as a favour and out of respect and a liking for 

your counterpart[s]. Try to concede only once you have gained 

agreement on a reciprocal concession on a separate or related 

issue.Do not use deadlines or pressure tactics. They won’t get you 

very far. Indeed, you are much more likely to be the victim of such 

tactics. Remain calm and be patient. It may not always be

necessary to focus only on financial benefits when negotiating. It is 

just as useful to point to areas such as power, influence, honour, 

respect and other non-monetary incentives. However, profit usually 

overrides all at the end of the day. 

Entertaining 

Most business entertaining will take place in restaurants. 

Azerbaijanis enjoy food and the meal is a time for relaxing and 

engaging in some good conversation. 

The protocol of Azerbaijani hospitality dictates that the host always 

pays for the meal. The concept of sharing a bill is completely alien 

to the culture. You may try and offer to pay, which may be seen as 

polite, but you would never be allowed to do so. The best policy is 

graciously to thank the host and then a few days later to invite the 

host to dinner at a restaurant of your choice. It may be a good idea 

to inform the restaurant manager that under no circumstances are 

they to accept payment from your guests. 

Your choice of restaurant is important. Senior Azerbaijani 

businessmen and officials do not welcome the idea of eating 

somewhere that is too public. Top hotels and restaurants are 

usually considered fine, and many have separate dining rooms for 

private meetings. Meeting purely for a drink in the evening 

happens only rarely. 

Evening meals may be accompanied by some alcohol, depending on 

your dining companions’ attitude to alcohol. If they have an 

alcoholic drink with their meal then it will usually be wine or vodka 

or both. Beer is less usual. If vodka is served there may be toasts. 

You will not be expected to make a toast but can do so later in the 

meal if you wish. Toasts are usually made for the business, family 

or friendship. You will not be considered anti-social if you do not 


159


down your glass of vodka in one. Taking a sensible mouthful at 

each toast will be acceptable. Vodka glasses are constantly refilled. 

Azerbaijanis often drink fruit juice in accompaniment to the vodka. 

A traditional Azerbaijani meal will comprise several courses. Salads 

and cheese usually start the meal, followed by various chicken, fish 

and lamb kebabs brought in echelons. Soup is less often served but 

Caspian sturgeon is popular and traditionally eaten with a sauce 

made from pomegranate (which has a strong flavour). Copious 

amounts of bread will also be served. 

Azerbaijanis smoke during meals and will often take breaks 

between courses to have a cigarette and a few drinks before 

moving onto the next. Tea (or sometimes Turkish coffee) is often 

served at the end of a meal, usually with something sweet. 

Conducting yourself in public 

When greeting someone, shake hands firmly, but note that 

Azerbaijanis will resist shaking hands while standing over the 

threshold of a door. This can lead to some confusion on arrival 

unless you are aware of the tradition. When departing, it is 

generally customary to again shake hands. 

Friends and relations will greet each other with either one or two 

kisses on the cheek, even men. It is better to avoid kisses as part of 

any greeting or farewell until you are familiar with the custom. 

Woman can be quite offended if you attempt to kiss them on the 

cheek in situations where in other cultures it might be acceptable. 

When entering a room, if you are not automatically met by 

someone, greet the most elderly or most senior first. At social 

occasions, greet the person closest to you, then work your way 

around the room or table anti-clockwise.

If you want to adopt local custom, greet people with the Islamic 

greeting of ‘Assalamu alaykum’ [peace be upon you]. 

Many Azerbaijanis smoke. There are no legal controls on where 

people can smoke but it is generally accepted that one does not 

smoke in confined places such as lifts and buses. Many taxi drivers 

smoke but will sometimes ask if passengers mind. There are 

smoking sections in all restaurants or the restaurant will probably 

be open for smoking at any table. Azerbaijanis do not usually wait 

for others to finish eating before they start to smoke. 

When seated opposite someone, try not to sit with your legs apart. 

Keep them together or cross your legs. Also try not to allow your 

feet to touch someone else’s. If the feet of two Azerbaijanis touch 

you will see the person whose feet touched the other briefly touch 

the hand of the other person. This is a customary way of a 

reassuring demonstration that you wish no ill-intent to the other 

person who you just ‘kicked’. 

Holding hands with someone of the opposite sex is acceptable in 

Baku and beaches but less so in rural areas. Kissing (other than as 

a greeting) in public should be avoided. 

To wave down a taxi or bus, stretch out your right arm and move 

your wrist inwards repeatedly. To avoid frustration you should note 

that taxis usually have their taxi signs illuminated whether they are 

carrying passengers or not. 

Queuing in Azerbaijan is not practiced widely. Banks and some 

service sector businesses try to control clients but it is far from 

what most business people from Europe or US are used to. It is not 

uncommon for people to jump queues or even go straight to the 

front. It is best to be patient. If frustration gets the better of you, 


161


politely point out you were in the line before them although most of 

the time this will make little difference. 

Language Policy 

All state bodies, local authorities, state agencies, political parties, 

non-governmental organizations (funds and public associations), 

trade unions, and legal entities (including their representative or 

branch offices) are required to use Azerbaijani in their official 

interactions and transactions. 

Any notarization, legalization, registration or other forms of 

documentation in a foreign language require translation into 

Azerbaijani with subsequent notarization of the translation. 

Seals and stamps of entities operating in the Republic of Azerbaijan 

must be in Azerbaijani. Letterheads, signage, announcements, 

advertisements, price lists, price tags, labels, and certifications and 

instructions applying to goods produced in Azerbaijan (and all other 

visual information) must be in Azerbaijani and, additionally, may be 

in other languages where necessary or desirable. For services 

rendered to foreigners, a foreign language may be used together 

with Azerbaijani. 

Useful hints 

Weights & measures 

Azerbaijan uses metric system 

Time 

Greenwich + 4 hour 

Language 

The state language is Azerbaijani (Azeri), besides; the overwhelming 

majority of the population speak fluent Russian, many of them

understand and speak Turkish, Persian, Georgian and other 

languages. In the hotels, bars and company offices, English 

is prevalent. 

Visas 

The duration of a visa can be either short-term (from 3 days to 3 

month) or long-term (up to one year) and are categorized as either 

business or tourist visas. They are registered through the Ministry 

of Foreign Affairs. 

Currency 

The national currency is Azerbaijani manat (AZN). 1US$ equaled 

approximately 0,82 AZN in 2008. Exchange of any currency is 

carried out in banks or numerous bureau de change. Banks usually 

work from 10.00 to 17.00-18.00. 

Credit Cards 

In hotels, big trade centres and supermarkets, international credit 

cards and USD are accepted. In small stores and restaurants cash 

is paid (as a rule in local currency). 

Communication 

The telephone communication system is effective and mobile 

coverage is extensive. Hotels have direct international dialing 

codes in addition to related business facilities; fax, computers, 

internet etc. Internet services are also rendered in numerous 

internet cafes in Baku and main cities. Public phones are rare. 

Mass Media 

Along with Azerbaijani newspapers and magazines local newspapers 

in English and Russian are available. Foreign English press is 

available in large hotels and by subscription. 


1USD 0.801AZN 

1EURO 1.129AZN 

1GBP 1.162AZN 

1RUB 0.027AZN 

*as of december 30, 2008 

163


Electricity 

The power standard is 220/240 V, 50 Hz. 

Water 

Tap water is safe for drinking, but in the hotels and restaurants 

spring water is mainly used in plastic bottles or boiled water. 

Medical Service 

The first medical aid is usually free. There are also private medical 

clinics and services, doctors that can speak foreign languages. A 

wide range of medicines are available in pharmacies, some of 

which are open 24 hours a day. 

Transport 

Public transport in Baku is provided by the Baku underground 

system and minibuses. One can use taxis round the clock. It is 

better to negotiate a price in advance. 

Customs Rules 

The import quota allows bringing three litres of spirits and three 

boxes of cigarettes. Technical passport is necessary for the owner 

of imported transport mean. Export of black caviar must not exceed 

300 gr. Goods and objects of art with cultural and historical value 

should be accompanied by a permit from according authority. 

Work Hours 

The weekend is usually considered to be Saturday and Sunday 

(mainly for civil servants), though many stores and supermarkets 

work every day. The beginning of the workday is at 8h00-9h00 and 

trade closes between 21h00-23h00. Restaurants and bars close 

considerably late.

Trade deals 

It is allowed to bargain about prices in the markets; it is a usual 

phenomenon. The salesperson may compromise in certain cases. 

Living cost 

Azerbaijan has become a highly popular destination, and thousands 

of foreigners have settled happily, enjoying the country’s 

combination of high living standards and low living costs. Although 

in most respects life in Azerbaijan is approaching Western 

standards of living, the cost of living remains substantially lower 

than in Western Europe. 

Shopping 

Retail in Baku has undergone a revolution in the past decade with 

many big shopping centres now located in the different parts of the 

city. Concepts of shopping and customer service are now 

comparable to those of Western countries. 

Sport 

In keeping with its reputation as a successful sporting nation, 

Azerbaijan Republic provides a wealth of sporting opportunities. 

The most popular sports are football (soccer), wrestling, boxing, 

martial arts, volleyball etc. 

Recently a significant number of Olympic sport centres, swimming 

pools and sport schools for children have been established and a 

number of Olympic sport centres are under construction. 

Azerbaijani sportsmen won 1 gold, 2 silver and 4 bronze medals at 

the Beijing 2008 Olympic Games. 


165


167 

City view at night. Baku. Azerbaijan



AZERBAIJAN 

169 

USEFUL 

CONTACTS


Ministries, State Committees and Agencies 

Tel.: (+99412) 4921300; 4924053 

Fax: (+99412) 4926859; 4920625 

office@apparat.gov.az 

www.president.gov.az 

Tel.: (+99412) 4927554 

Fax: (+99412) 4989786; 

nk@cabmin.baku.az; www.cabmin.gov.az 

Tel.: (+99412) 4926675; 49897048 

Fax: (+99412) 49897722 

azmm@meclis.gov.az; www.meclis.gov.az 

Tel.: (+99412) 493 88 67 

Fax: (+99412) 492 58 95 

office@economy.gov.az 

www.economy.gov.az 

Tel.: (+99412) 4934398; 4934294 

Fax: (+99412) 4935605 

mugam@culture.gov.az 

Tel.: (+99412) 4909222 

Fax: (+99412) 4924590 

info@mia.gov.az; www.mia.gov.az 

Office of the President of the Republic of Azerbaijan 19, Istiglaliyyat Street, Baku, AZ1066 

Cabinet of Ministers of the Republic of Azerbaijan 68, Lermontov Street, Baku, AZ1066 

Parliament of the Republic of Azerbaijan (Milli Majlis) 1, Parlament Avenue, Baku, AZ1152 

40, U.Hajibayov str.,“The Government 

House”, Baku, AZ1000 

Ministry of Economic Development 

40, U.Hajibayov Street,“The Government 

House”, Baku, AZ1016 

Ministry of Culture and Tourism 

Ministry of Internal Affairs 7, Husu Hajiyev Street, Baku, AZ1005 

Tel.: (+99412) 4929692; 4923401 

Fax: (+99412) 4988480;4927251 

secretariat@mfa.gov.az; www.mfa.gov.az 

Ministry of Foreign Affairs 4, Sh.Gurbanov Street, Baku, AZ1009 

Consular Department Tel.: (+99412) 4929692 (ext. 2037; 2041) 

Tel.: (+99412) 4038632; 4038624 

Fax: (+99412) 4038971 

Ministry of Taxes 16, Landau Street, Baku, AZ1073 info@taxes.gov.az; www.taxes.gov.az 

Tel.: (+99412) 4656438; 4656442 

Fax: (+99412) 4656438 

Ministry of Youth and Sport 4, Olimpiya Street, Baku, AZ1072 myst@myst.gov.az; www.mys.gov.az

Tel.: (+99412) 4985094 

Fax: (+99412) 4930695 

mednet@mednet.az; www.health.gov.az 

Tel: (+99412) 4938103; 4933012 

Fax: (+99412) 4987969; 4939648 

office@minfin-az.com; www.maliyye.gov.az 

Tel: (+99412) 4937622 

Fax: (+99412) 4924369 

cpr@mns.gov.az; www.mns.gov.az 

Tel.: (+99412) 4314636; 4303191 

Fax: (+99412) 4316022 

office@mintrans.az; www.mintrans.az 

Tel.: (+99412) 4932892; 4980516 

Fax: (+99412) 4930884; 4973745 

aqry@azerin.com 

Tel.: (+99412) 4394189 

Fax: (+99412) 4394189 

dmicpfp@asumo.baku.az 

Ministry of Health 4, Kichik Daniz Street, Baku, AZ1014 

Ministry of Finance 83, Samed Vurgun Street Baku, AZ1022 

Ministry of National Security 2, Parlament Avenue, Baku, AZ1006 

Ministry of Transport Block 1054, Tbilisi Avenue, Baku, AZ1000 

“The Government House” 40, U.Hajibayov 

Street, Baku, AZ1016 

Ministry of Agriculture 

Ministry of Defence 3, Parlament Avenue, Baku, AZ1073 

USEFUL CONTACTS 

Ministry of Defence Industry 40, Matbuat avenue, Baku Tel.: (+99412) 5106347; 4392453 

Tel.: (+99412) 5120061; 5120066; 5120026 

Ministry of Emergency Situations 57, Tbilisi Avenue, Baku 

Fax: (+99412) 5120016 

Tel.: (+99412) 4381521; 4388508 

Fax: (+99412) 4925907 

Ministry of Ecology and Natural Resources 100A, Bahram Agayev Street, Baku, AZ1033 mineco@box.az; www.eco.gov.az 

Tel.: (+99412) 4930004 

Ministry of Communications and Information 

Fax: (+99412) 4987912 

Technologies 33, Zarifa Aliyeva Street, Baku, AZ1000 info@mincom.gov.az; www.mincom.gov.az 

Tel.: (+99412) 4470588 

“The Government House”, 

Fax: (+99412) 4319005 

Ministry of Industry and Energy 

40, U.Hajibayov str., Baku, AZ1000 

mfe@azdata.net 


171


Ministries, State Committees and Agencies, continued from the previous page. 

Tel.: (+99412) 4300977; 4300116 

Fax: (+99412) 4300981 

contact@justice.gov.az 

www.justice.gov.az 

Tel.: (+99412) 4301156 

Fax: (+99412) 4976367 

Tel.: (+99412) 4963515; 4963311 

Fax: (+99412) 4963483 

office@min.edu.az; www.edu.gov.az 

Tel.: (+99412) 5965034; 5964407 

Fax: (+99412) 5965034 

mlspp@gov.az; www.mlspp.gov.az 

Tel.: (+99412) 4388080; 4397780 

Fax: (+99412) 4981836 

externall@az-customs.net 

www.az-customs.net 

Tel.: (+99412) 4386498; 4389376 

Fax: (+99412) 4382442; 4381013 

ssc@azstat.org; www.azstat.org 

Tel.: (+99412) 4902408 

Fax: (+99412) 4903359 

office@emdk.gov.az 

www.stateproperty.gov.az 

Tel.: (+99412) 4935058 

Fax: (+99412) 4982559 

azstatecom@yahoo.com; www.scs.gov.az 

Tel.: (+99412) 4931054; 4986197 

Fax: (+99412) 4986187 

info@diaspora.gov.az; www.diaspora.az 

Tel.: (+99412) 4933467 

Fax: (+99412) 4981414 

khanlarov@bakililar.az 

Ministry of Justice 1, Inshaatchylar Avenue, Baku, AZ1073 

Department on State Registration of Legal Entities 

Ministry of Education 49, Khatai Avenue, Baku, AZ1008 

Ministry of Labour and Social Protection of Population 85, Salatin Asgerova Street, Baku AZ1009 

State Customs Committee 2, Inshaatchilar Avenue, Baku, AZ1073 

State Statistical Committee Inshaatchilar Avenue, Baku, AZ1136 

The State Committee on Property Issues 20, U. Safarov Street, Baku AZ1025 

State Committee for Securities of the 

Republic of Azerbaijan 19, Bul-Bul Avenue, Baku, AZ1000 

State Committee for work with Diaspora 24, Samed Vurgun Street, Baku, AZ1000 

State Committee for Town Planning and Architecture 67, Fizuli Street Baku, AZ1014

Tel.: (+99412)4901323; Fax:(+99412)4904225 

noc-aze@noc-aze.org; www.noc-aze.org 

Tel.: (+99412) 4977048; 4322052 

Fax: (+99412) 4328959 

press@dtxk.gov.az; www.dtxk.gov.az 

Tel.: (+99412) 4988572; 4988422 

Fax: (+99412) 4989637 

info@ak.ab.az 

Tel.: (+99412) 4300921; 4316181 

Fax: (+99412) 4315136 

info@refugee.gov.az 

Tel.: (+99412) 4926747 

Fax: (+99412) 4929333 

addk@azdata.net; www.addk.net 

Tel/Fax: (+99412) 4936008 

office@cec.gov.az; www.cec.gov.az 

Tel.: (+99412) 4980092 

Fax: (+99412) 4935872 

office@scfwca.gov.az; www.scfwca.gov.az 

Tel.: (+99412) 4499959; 4498499; 4498491 

Fax: (+99412) 4405224 

azs@azstand.gov.az; www.azstand.gov.az 

Tel.: (+99412) 4936920 

Fax: (+99412) 4932025 

office@ach.gov.az; www.ach.gov.az 

Tel.: +994 12 498 6255 (fax ext. 112) 

office@oilfund.az; www.oilfund.az 

Tel.: (+99412) 4921789 

Fax: (+99412) 4971167 

info@socar.az; www.socar.az 

Tel./Fax: (+99412) 437 29 03/09 

aisayev@aic.az; www.aic.az 


National Olympic Committee Olimpiya Street, 5, Baku, AZ1072 

93A, Shafayat Mekhtiyev Street, 

Baku, AZ1141 

State Committee of Land and Cartography 

Supreme Certifying Committee under the President of 

the Republic of Azerbaijan 9, Fikret Amirov Street, Baku, AZ1009 

State Committee for Refugee and Displaced Persons 

Problems 57, Tbilisi Avenue, Baku, AZ1122 

State Committee for the Work with Religious 

Associations 12, Akhmad Javad Street, Baku, AZ1001 

Central Election Commission 3, Rasul Rza Street, Baku AZ1000 

State Committee on Family, Women and Children 

Affairs 40, U.Hajibayov str., Baku, AZ1000 

124, Mardanov Gardashlari Street, Baku, 

AZ1078 

State Agency on Standardization, Metrology and 

Patents of the Republic of Azerbaijan 

“The Government House”, 6th floor, 40, 

U.Hajibayov Street, Baku AZ1000 

Chamber of Accounts of the Republic of Azerbaijan 


State Oil Fund of the Republic of Azerbaijan 24 Neftchilar Ave., Baku, Azerbaijan, AZ1001 

State Oil Company of Azerbaijan Republic (SOCAR) 73, Neftchilar Avenue, Baku, AZ1000 

Azerbaijan Investment Company 11, Hasan Abdullayev str., Baku, Azerbaijan 

173


Tel.: (431) 403 13 22; Fax: (431) 403 13 23 

office@azembvienna.at 

www.azembvienna.at 

Tel: (375 17) 293 32 99; 33 99; 34 99 

293 37 65 (consular section) 

Fax: (375 17) 237 2751 

azoffice_minsk@avilink.net 

Tel.: (322) 345 26 60; 


Fax: (322) 345 91 58; 


office@azembassy.be; www.azembassy.be 

Tel.: +32 (2) 707 27 97/99 

Fax: +32 (2) 707 27 98 

azerbaijan@hq.nato.int 

www.nato.int/pfp/azerbaijan 

Tel: +359 (2) 933 90 70; 


Fax: +359 (2) 933 90 77; 


sefirlik@azerembsof.com 

consular@azerembsof.com 

www.azerembsof.com 

Tel: +1 (613) 288 04 97 

Fax: +1 (613) 230 80 89 

azerbaijan@azembassy.ca 

www.azembassy.ca 

Tel.: (8610) 65 32 46 14/98 

Fax: (8610) 65 32 46 15 

mailbox@azerbembassy.org.cn 

www.azerbembassy.org.cn 

Embassies of the Republic of Azerbaijan abroad 

Embassy of the Republic of Azerbaijan in Austria (also 

accredited to The Republic of Slovakia, OSCE, UNOV, 

UNIDO, IAEA, CTBTO) Hugelgasse 2, A-1130 Vienna 

Embassy of the Republic of Azerbaijan in Belarus Minsk-220029, Vostochnaya str. 133/167 

Embassy of the Republic of Azerbaijan in the 

Kingdom of Belgium (also accredited in Luxemburg, 

Netherlands), Mission to European communities Bruxelles, 464, Av. Moliere, 1050 BXL 

Mission to NATO (also accredited to OPCW) Brussels, NATO HQ, Bd. Leopold 3 

Embassy of the Republic of Azerbaijan in Republic of 

Bulgaria Sofiya 1000, Vasil Levski 79 

275 Slater Street, suite 904, Ottawa, 

Ontario, 

K1P 5H9 

Beijing, 100600, Qijiayuan Diplomatic 

Compound, Villa B-3 

Embassy of the Republic of Azerbaijan in Canada 

Mission to International Civil Aviation Organisation 

Embassy of the Republic of Azerbaijan in the People’s 

Republic of China (also accredited in Republic of 

Korea, Vietnam, Mongolia and Democratic People’s 

Republic of Korea)

Tel: + 420 246032422; Fax: + 420 246032423 

Consular section: 

Tel: + 420 246032424; Fax: + 420 246032425 

prague@mission.mfa.gov.az 

www.azembassyprague.az 

Tel: (537) 207 92 80 

ilhamaga2004@yahoo.co.uk 

Tel.: (202) 735 12 30 

Fax: (202) 736 12 28 

azsefqahira@link.net 

www.azembassy.org.eg 

Tel.: (331) 44186020; 

44180175 (consular section) 

Fax: (331) 44 18 60 25 

ambazer@wanadoo.fr 

www.amb-azerbaidjan.fr 

Tel: +33 (1) 45 68 28 77/34 00 

Fax: +33 (1) 43 06 05 47 

dl.azerbaidjan@unesco.org 

Tel.: +33(390)222090; Fax: +33(390)222099 

azrepcoe@wanadoo.fr 

Tel.: (99532) 252639; 253526/27 


Fax: (99532) 250013 

azembassy@internet.ge 

www.azembassy.ge 

Tel.: 49( 30) 2191613; 

206 48063 (consular section) 

Fax: 49(30) 21916152; 


azerbembgermany@aol.com 

www.azembassy.de 


Embassy of the Republic of Azerbaijan 

in Czech Republic Na Mícánce 32, Praha 6 - Hanspaulka 160 00 

Embassy of the Republic of Azerbaijan in Cuba Havana, 5 avenida 9608 

Embassy of the Republic of Azerbaijan in Arab Republic 

of Egypt (accredited in: Socialist People’s Lybian Arab 

Jamahiria, Permenent Observer to the League of Arab 

States) Cairo, Zamalek, Hassan Asem Street, 22 

Embassy of the Republic of Azerbaijan in France Paris, 209, Rue de la Universite 75007 

Paris cedex 15, Maison de l’UNESCO, bur. 

R25, R 40, 1, rue Miollis, 75732 

Mission to UNESCO 

Permanent Mission to the Council of Europe Strasbourg, 2, Rue Westercamp, 67000 


Tbilisi, Vacke-Saburtalo district, 

Nutsubidze Str. 47 

Embassy of the Republic of Azerbaijan in Georgia 

Axel-Springer Strasse Street 54 A, Berlin 

Kommandanten Street 80, Berlin 

Embassy of the Republic of Azerbaijan in Germany 

Consular section 

175


Embassies of the Republic of Azerbaijan abroad, continued from the previous page. 

Tel: (30210) 363 27 21; 


Fax: (30210) 3639087; 


az_emb_gr@yahoo.com 

www.azembassy.gr 

Tel.: +36 (1) 374 60 70/ 71 

Fax: +36 (1) 302 35 35 

bakybudapest@azerembassy.hu 

www.azerembassy.hu 

Tel.: +91 (11) 26 15 22 28 

Fax: +91 (11) 26 15 22 27 

azembassy@touchtelindia.net 

Tel: +62 (21) 549 19 39 

Fax: +62 (21) 549 17 45 

azerbembjkt@link.net.id 

Tel.: +98 (21) 221 25 54; 221 51 91 

Fax: +98 (21) 221 75 04 

azaremb@neda.net; www.azembassy.ir 

Tel: +98 (411) 335 99 01/ 02/ 03 

Fax: +98 (411) 335 99 04 

office@azconsulatetebriz.ir 

Tel.: +39 (06) 85305557 

Fax: +39 (06) 85831448 

azerb.roma@azembassy.it 

www.azembassy.it 

Tel: +81 (3) 54 86 47 44 

Fax: +81 (3) 54 86 73 74 

info@azerbembassy.jp 

Tel: +9626 59355 25; Fax: +9626 5932826 

azembassy_jordan@mail.ru 

azerbaijan@azembassy.com.jo 

10, Skoufa Street, 10673 Kolonaki, Athens 

23, Vasilissis Sofias Ave., 10674, Athens 

Embassy of the Republic of Azerbaijan in Greece 

Consular section 

H-1054, Budapest, Szabadsag ter. 7, Bank 

Center, Platina Tower, 5th floor 

Embassy of the Republic of Azerbaijan in Hungary 

Embassy of the Republic of Azerbaijan in India (also 

accredited to Nepal Kingdom) New Delhi, Vasant Marg, Vasant Vihar E-70 

Jl. Mas Putih Blok D Persil 29, Grogol Utara, 

Kebayoran Lama, Jakarta Selatan 12210 


Indonesia (also accredited in Philippines) 

Tehran, Shahid Levasani, Shahid Salehi S. 

Vatanpur street 30 

Embassy of the Republic of Azerbaijan in Islamic 

Republic of Iran (also accredited to ECO) 

Tabriz, Kamarbandi khiyabani, Shahid 

Ayatullahi Str. 

Consulate General in Tabriz 

Embassy of the Republic of Azerbaijan in Italy 

(accredited in: San Marino, Malta, as well as to UN 

FAO, IFAD and WFP) Viale ReginaMargherita 1, Roma 00198 

Embassy of the Republic of Azerbaijan in Japan Tokio, Meguro-ku, Higashigaoka 1-19-15 

Embassy of the Republic of Azerbaijan in Jordan Abdoun, Muhammad Ali Bdair str.

Tel.: (73172) 24 15 81; Fax: (73172) 24 16 90 

astana@azembassy.kz; www.azembassy.kz 

Tel +7 7292 33 67 07; Fax +7 7292 33 67 06 

aktau@mission.mfa.gov.az 

azconsul.aktau@gmail.com 

Tel: (996312) 510770; Fax:(996312) 513172 

bishkek@mission.mfa.az 

Tel: + 822 7971765, 7971766 

Fax: + 822 7921767 

seoul@mission.mfa.gov.az 

www.azembassy.co.kr 

Tel.: +965 535 52 47; Fax: +965 535 52 46 

embazerbaijan99@yahoo.com 

www.azerembassy-kuwait.org 

Tel.: (371) 714 28 89/90/91/92/93 

Fax: (371) 714 28 96 

riga@azembassy.lv; www.azembassy.lv 

Tel: (21821) 3503491; Fax: (21821) 3503491 

azer_ly@hotmail.com 

Tel.: +961(1)482000; 492990 

Fax: +961(1)498630 

freka@dm.net.lb 

Tel: (370) 52190042; Fax: (370) 52195601/02 

info@azembassy.lt 

Tel: (603) 4252 6800/4800 

Fax: (603) 42571800 

azembkl@streamyx.com 

www.azembassy.com.my 

Tel: (5255) 55969900; Fax: (5255) 55962613 

imukhtarov@yahoo.com 

www.azembassy.org.mx 


Embassy of the Republic of Azerbaijan in Kazakhstan Diplomatic city, Residence C-14, Astana 

Consulate General in Aktau Aktau 4th microdistric flat 12 

Embassy of the Republic of Azerbaijan in Kyrgyzstan Bishkek, Shukurov str. 41 

3rd Floor, Annex Building, Hannam Tower, 

730 Hannam-dong, Yongsan-gu, Seoul 

140-893 

Embassy of the Republic of Azerbaijan in Korea 

Embassy of the Republic of Azerbaijan in Kuwait El-Kuwait, Al-Yarmuk Str. 1, bloc 2, villa 15 


Latvia (also accredited in Estonia) 3 Raina Bulvaris, Riga 

Tripoli, Sugul Juma, Tarig Akada, Qarib Min 

Embassy of the Republic of Azerbaijan in Libya 

Mujamaa Sihhi Arada 

Beirut, Jdeidel el Mein, Bourj Hammoud, 

Ghossoub Center, Area 7, Str. 2, Bld. 120 

Honorable Consulate of the Republic of Azerbaijan in 

the Republic of Lebanon 

Embassy of the Republic of Azerbaijan in Lithuania Olimpieciu 5-7, Vilnius 


50450, Wisma Chinese Chamber, Jalal 

Ampang 258 

Embassy of the Republic of Azerbaijan in Malaysia 

Embassy of the Republic of Azerbaijan in Mexico Mexico, D.F., Bosques de dos Sauces 76 

177



Tel.: (37322) 21 42 09; Fax: (37322) 23 22 77 

azembassy@moldnet.md 

Tel: 00 212 37 671915; 00 212 37 671922 

Fax: 00212 37 671918 

azembma@menara.ma 

Embassy of the Republic of Azerbaijan in Moldova Kishineu, 127/1 Shtefan Chel Mari Str. 

Embassy of the Republic of Azerbaijan in Morocco 

(also accredited in Tunis, Mauritania and Senegal) Rabat, Aqdal region, Abu Hanifa Str. 3 

Embassy of the Republic of Azerbaijan in Netherlands 

(accredited in Organization for the Prohibition of Laan Copes van Cattenburch 127, 2585 EZ, 

Chemical Weapons) 

The Hague 

Tel: +3170 3538205; Fax: +3170 3538207 

azembassy.netherlands@yahoo.com 

Tel.: (9251) 282 93 45; 282 34 55 

Fax: (9251) 282 08 98; 


azeremb@isb.paknet.com.pk 

www.azembassy.com.pk 

Tel.: +48 (22) 616 21 88; 617 67 28 

Fax: +48 (22) 616 19 49 

info@azer-embassy.pl 

www.azer-embassy.pl 

Tel: (0974) 493 24 50; Fax: (0974) 493 17 55 

azembassy@qatar.com.qa 

Tel.: +40 (21) 2332466/84; (788) 432545/46 

Fax: +40 (21) 2332465 

azsefroman@azembassy.ro 

www.azembassy.ro 

Tel.: (7495) 629 43 32; 629 16 49; 629 55 46 

(consular section); 602 45 72 (press service) 

Fax: (7495) 202 50 72 

azerirus@cnt.ru 

www.azembassy.msk.ru 

Tel: +7 (812) 571 29 44, 571 28 45 

Fax: +7 (812) 571 29 45 

azconsul@mail.wplus.net 

Islamabad, Ataturk Avenue, G-6/3, 

Str. 87, H 87 

Embassy of the Republic of Azerbaijan in Islamic 

Republic of Pakistan (also accredited in Afganistan) 

Embassy of the Republic of Azerbaijan in Poland Zwyciencow 12, 03-941 Warszawa 

Doha West Bay-Dafna, str. 66, Saba 41 P.O. 

Embassy of the Republic of Azerbaijan in Qatar 

Box 23900 

Embassy of the Republic of Azerbaijan in Romania Bucharest, Grigore Gafencu 10, Sector 1 

Embassy of the Republic of Azerbaijan in Russian 

Federation 125009, Leontiyevskiy pereulok 16, Moscow 

Consulate General in St. Petersburg St. Petersburg, Ulitsa Marata 73

Tel.: +966(1)4192382; Fax: +966(1)4192260 

azembassy@awalnet.net.sa 

www.azembriyadh.org. 

Tel/Fax: (96026) 644 41 93 

Tel.: (3491) 759 10 60 

Fax: (3491) 759 70 56 

info@azembajada.es; www.azembajada.es 

Tel:(468) 411 24 55; Fax:(468) 411 24 58 

azerembassy@gmail.com 

Tel.: +41(22)3505040; Fax: +41(22)3505041 

info@azembassy.ch; www.azembassy.ch 

Tel.: +41(22)9011815/21 

Fax: +41(22)9011844 

az.mission.unog@iprolink.ch 

www.azerbaijan-un-geneva.az 

Tel: (992 37) 227 11 90/91 


Fax: (992 37) 227 66 51 

dushanbe@mission.mfa.gov.az 

Tel.: +90 (312) 491 16 81/ 82/ 83 

Fax: +90 (312) 492 04 30 

ankara@mission.mfa.gov.az 

www.azembassy.org.tr 

Tel.: +90 (212) 325 80 42/ 45 

Fax: +90 (212) 284 95 79 

azkonsul@kablonet.com.tr 

www.azconsulateistanbul.org.tr 

Tel.: +90 (474) 223 64 75; 223 13 61 

Fax: +90 (474) 223 87 41 

azconsulatekars@ttnet.net.tr 


Embassy of the Republic of Azerbaijan in the Kingdom 

of Saudi Arabia (accredited in: Bahrain, Oman and Al Worood Quarter, Amir Feysal Ibn Saad bin 

Organization of Islamic Conference) 

Abdurahman 59, 94005, Er-Riad 

Office of the Embassy in Jeddah 

Al-Horma D-1 Iskanderiya str.2474,apt.10 

Embassy of the Republic of Azerbaijan in Kingdom 

of Spain (accredited in Andorra and World Tourism 

Organization) Calle Ronada de Avutarda 38, 28043 Madrid 

Embassy of the Republic of Azerbaijan in Sweden Stockholm, Karlavagen 60 

Embassy of the Republic of Azerbaijan in Switzerland 

(also accredited in Holy See and Liechtenstein) Dalmaziquai 27, CH 3005 Bern 

67, Rue de Lausanne, CH-1202, 

Geneva, Suisse 

Permanent Mission to the UN Office in Geneva and 

other International Organizations at Geneva 

Embassy of the Republic of Azerbaijan in Tajikistan Parkharskaya str. 1, Dushanbe 

Embassy of the Republic of Azerbaijan in Turkey 

(also accredited in Macedonia) Ankara, Diplomatic Site, Baku Sokak. 1, Oran 


Consulate General in Istanbul 

(also accredited to BSEC) Istanbul, Sumbul Sokak 17, Levent 1 

Sukapi mahallesi, Eski Erzrum caddesi, 

Dostluq sitesi N 123 

Consulate General in Gars 

179



Tel: +993 (12) 36 46 08/09 

Fax: +993 (12) 36 46 10 

Embassy of the 

Ashgabat, 2062, 

azsefir_ashg@online.tm 

Republic of Azerbaijan in Turkmenistan 

Prosvesheniye str. 44 

www.azembassyashg.com 

Tel.: (38044) 484 6939/40/47 

Fax: (38044) 484 6946 

embass@faust.kiev.ua 

Embassy of the Republic of Azerbaijan in Ukraine Glubochiska 24, Kiev 04050 

www.azembassy.org.ua 

Tel.: +971(2)6662848; Fax: +971(2)6663150 


Embassy of The Republic of Azerbaijan 

Abu Dhabi, Al-Bateen Area, Villa Sector 

azembasy@emirates.net.ae 

in United Arab Emirates 

W/16, Plot N-297, P.O. Box 45766 

www.azembassyuae.org 

Tel+9714 261 45 96; Fax+9714 266 78 30 

Consulate in Dubai P.O Box 186160 Hor-Al Anz Alkhali bldg 

azconsul@eim.ae 

Tel.: (44207)9383412; Fax: (44207)9371783 

Embassy of the Republic of Azerbaijan in UK (also 

london@mission.mfa.gov.az 

accredited in Ireland), 4 Kensington Court, London W8 5DL 

www.azembassy.org.uk 

Tel.: +1 (202) 337 35 00; 


Fax: +1 (202) 337 59 11; 

Embassy of the Republic of Azerbaijan in USA 


(also accredited in Mexico and Organization of 

2741 34th Str., N.W., Washington, D.C, 

azerbaijan@azembassy.us 

American States) 

20008, USA 

www.azembassy.us 

Tel: 1 310 444 9101; Fax: 1 310 477 4860 

11766 Wilshire Blvd., uite#1410, 

info@azconsulatela.org 

Consulate General in Los Angeles 

Los Angeles, CA 90025 

www.azconsulatela.org 

Tel.: +1 (212) 371 25 59; 371 28 32, 371 27 21 

Fax: +1 (212) 371 27 84; 371 26 72 

Permanent Mission at the UN, New York 

newyork@mission.mfa.gov.az 

(also accredited in Cuba) 866 UN Plaza, Suite 560, New-York, 10017 

www.un.int/azerbaijan 

Tel.: +998(71)1736167; Fax: +998 (71)1732658 

Embassy of the Republic of Azerbaijan in Uzbekistan Tashkent, Shark Tongi 25 sefir@tsk.sarkor.uz; www.azembassy.uz

Tel.: (99412) 4901234; Fax: (99412) 4961235 

reservations.hhbaku@hyattintl.com 

www.baku.hyatt.com 

Tel.: (99412) 4907090 

Fax: (99412) 4907096;4907084 

sm@grand-europe.com; www.grandeurope.com 

Tel.: (99412) 4982402; Fax: (99412) 4972451 

reservations@isrplaza.com 

www.radisson.com/bakuar 

Tel: (99412) 4906000; Fax: (99412) 4968900 

reservations.baku@rezidorparkinn.com 

www.baku.rezidorparkinn.com 

Tel: (99412) 4968000; Fax: (99412) 4968008 

adminoffice@excelsiorhotelbaku.az 

www.excelsiorhotelbaku.az 

Tel.: (99412) 4970809; Fax: (99412) 4970702 

info@meridianhotel.az; www.meridianhotel. 

az 

Phone: (+99412) 4996101; Fax: (+99412) 

4996102 

Mobile: (+994 50) 225 09 99 

info@delfinhotel.az; www.delfinhotel.az 

Tel.: (99412) 4361041;4361078 

Fax: (99412) 4361089 

office@felsbaku.com; www.felsbaku.com 

Tel.: (99412) 4410132; 4410133 

Fax: (99412) 4410134 

hotel@irshad.az; www.irshad.az 


Hotels 

Park Hyatt Baku 1033, Izmir Street, Baku, AZ1065 

Grand Hotel Europe Baku 1025/30, Tbilisi Avenue, Baku, AZ1078 

Radisson SAS ISR Plaza, 340, Nizami Street, Baku, AZ1000 

Park Inn Azerbaijan 1, Azadlig Avenue, Baku, AZ1000 

Excelsior Hotel Baku 2, Heydar Aliyev, Avenue, Baku, AZ1154 

Old City, 39, A.Zeynally Street, Baku, 

AZ1000 

Meridian Hotel 


Delfin Hotel 9-th km of Sumgayit highway, Baku, AZ1024 

City Mansion 153, Azadlig Avenue, Baku, AZ1106 

Irshad Hotel 11, Vagif Avenue, Baku, AZ1007 

181


Hotels, continued from the previous page. 

Tel.: (99412) 4925477; 4972507 

Fax: (99412) 4925477 

request@azcothotel.com 

www.azcothotel.com 

Tel.: (99412) 4987809; 4989855 

Fax: (99412) 5985287; rcaspian@intrans.az 

Tel.: (99412) 5961127; Fax: (99412) 5961128 

sales@diplomathotelbaku.com 

www.diplomathotelbaku.com 

Tel.: (99412) 4974777; Fax: (99412) 4974780 

cbh@azeronline.com 

www.crescentbeachhotel.com 

AZCOT Guest House Husi Hajiyev Str.7, Lane 1, Baku, AZ1001 

CASPIAN Guest House 8, Zorge Street, Baku, AZ1000 

185, SuleymanRahimov Street, Baku, 

AZ1000 

Diplomat Hotel Baku 

Shikhov settlement, Salyan highway, Baku, 

AZ1003 

The Crescent Beach Hotel & Leisure Resort 

Hire and rental of cars 

Tel.: (99412) 4975455; 4975222 

Fax: (99412) 4975553 

office@avis.az; info@avis.az; www.avis.az 

Tel./Fax: (99412) 4968462; 4901497 4901793 

info@ayla.az; www.ayla.az 

Tel.: (+99412) 4372685 

Fax: (+99412) 4373513 

sti@sti.az; www.sti.az 

Tel.: (99412) 4934300; 4986500 

Fax: (99412) 4937253 

aittravel@aittravel.com; www.aittravel.com 

AVIS Rent a Car Set-Auto Ltd. 528A, H.Javid Avenue, Baku, AZ1073 

3, F.Bayramov Street, Khatai district, Baku 

“Ayla” Rent a Car 

AZ1000 

STI Azerbaijan A.Aliyev Street, 7/6 Baku AZ1005 

HRG Azerbaijan 34, Khagani Street, Baku, AZ1000 

Notary’s Office #1 17, U.Hajibayov Street,Baku, AZ1000 Tel.: (99412) 4934514 

Notary offices

Consultant services 

Tel.: (99412) 4929277; Fax: (99412) 4929288 

vescc@vescc.com; www.vescc.com 

Tel.: (99412) 4971801; Fax: (99412) 4971805 

baku.info@bakernet.com; www.bakernet. 

com 

Tel.: (+99412) 5982970 /Fax: (+99412) 

5982975 

nali@deloitte.az; www.deloitte.az 

Tel: (+99412) 4368610; Fax: (+99412) 

4368611 

zygon@zygon.az; www.zygon.az 

“VneshExpertService” Consulting Company 3, InshaatchilarAvenue, Baku, AZ1073 

96, Nizami Street, Landmark Building, 

Baku AZ1010 

“Baker & McKenzie – CIS” Limited 

96, Nizami Street, Landmark Building, 4th 

floor, Baku, AZ1010 

“Deloitte & Touche” LLC 

44 J. Jabbarli Street Caspian Plaza, 3rd 

Floor, Baku AZ1065 

Zygon Caspian 

Consulting Azerbaijan 

Emergency phone numbers 

Fire Station 101; 4910734 

Police 102; 4934265; 4958817 

Ambulance 103 

Gas Emergency 104 

Speaking clock 106 

International telephone services 107 


Info Service 109 

183


185 

Face Pattern of the Momine Khatun Mausoleum in 

Nakhchivan, Azerbaycan.



AZERBAIJAN 

187 

ANNEXES


Annex 1: Bilateral Investment Treaties 

Country Signed Ratification Date 

Austria 4 July 2000 24 October 2000 

Belgium-Luxemburg Economic Union 18 May 2004 26 October 2004 

Bulgaria 7 October 2004 1 March 2005 

China 7 March 1994 

Croatia 02 October 2007 1 February 2008 

Egypt 24 October 2002 13 May 2003 

Finland 26 February 2003 13 May 2003 

France 1 September 1998 27 November 1998 

Georgia 8 March 1996 19 April 1996 

Germany 22 December 1995 25 June 1996 

Greece 21 June 2004 26 October 2004 

Hungary 18 May 2007 1 October 2007 

Iran 28 October 1996 1 December 1998 

Israel 20 November 2006 not ratified 

Italy 25 September 1997 17 February 1998 

Jordan 05 May 2008 

Kazakhstan 16 September 1996 15 November 1996 

Korea 23 April 2007 1 October 2007 

Kuwait 10 February 2009 28 April 2009

Kyrgyzstan 23 April 1997 26 June 1997 

Latvia 3 October 2005 1 March 2006 

Lithuania 8 June 2006 not ratified 

Lebanon 11 February 1998 4 December 1998 

Moldova 27 November 1997 8 December 1998 

Norway 25 September 1996 

Pakistan 9 October 1995 12 March 1996 

Poland 26 August 1997 13 February 1998 

Qatar 28 August 2007 19 October 2007 

Romania 29 October 2002 5 December 2003 

Saudi Arabia 10 March 2005 10 May 2005 

Switzerland 23 February 2006 not ratified 

Tajikistan 15 March 2007 5 June 2007 

Turkey 9 February 1994 14 June 1994 

UAE 20 November 2006 not ratified 

Ukraine 25 March 1997 6 June 1997 

United Kingdom 4 January 1996 15 March 1996 

ANNEXES 

USA 1 August 1997 14 April 1998 

USAID 7 February 2007 

Uzbekistan 27 May 1996 16 July 1996 

189


Annex 2: Brief comparative analysis of LLC and JSC as per Azerbaijani law 

JSC LLC 

Minimum number of Founders At least 1 founder. Closed JSC-maximum number At least 1 founder. However, there is not a statutory 

of shareholders may not exceed fifty. If such limit is limit for the number of participants. 

exceeded, such close JSC must either be reorganized 

into an open JSC, or be judicially liquidated 

Liability of Founders The participants/shareholders are not personally liable for the obligations/liabilities of JSC/LLC. Liability of 

founders is limited to the amount of their equity (capital) contribution. 

There is no specified minimum capital requirement. 

However, the Civil Code 2000 states that the 

minimum capital is to be set by the relevant 

executive authorities. Charter capital must be paid in 

full prior to state registration. Capital contributions 

in kind must be valued by an independent auditor. 

Paid in capital of participants is not considered to 

be a security. Therefore, there are no registration 

requirements with the State Securities Committee. 

Unless provided otherwise in the Charter, a 

participant may alienate (sell/transfer) his 

participating interest to third parties. However, the 

other participants have the right of first refusal, if 

the Charter does not provide otherwise. 

Capital Requirements Open JSC – 4,000 AZN circa 4,760 USD; Closed 

JSC – 2,000 AZN, circa 2,380 USD. Charter capital 

must be paid in full prior to state registration. 

Capital contributions in kind must be valued by an 

independent auditor. Value of in-kind contributions 

of a newly founded company and existing company 

is determined by a foundation meeting and general 

meeting of shareholders respectively. 

Securities Shares must be registered at the State Securities 

Committee. Placement of securities can be public 

(offer to public at large) or close (offer to a limited 

group of investors). Open joint-stock companies can 

place securities only through public offering (except 

for establishment and reorganization of a company 

and conversion of shares) and close joint stock 

companies can place securities only through close 

offerings. 

Transferability of Shares/ Open – no restriction on transferability of one’s 

participatory interest 

shares to another. Closed – shareholders have the 

right of first refusal.

Same as JSC, except there is no requirement for a 

Supervisory Board, which can be established if so 

desired by the participants. 

Management structure The General Meeting of Shareholders (GMS) is 

the supreme governing body, which has exclusive 

competence in fundamental matters (such as 

amendments to Charter and to the Capital Fund, any 

decision on liquidation, reorganization, etc.). The law 

does not allow delegation of such powers to other 

inferior governing bodies. A JSC which has more than 

50 shareholders must create a Supervisory Board. The 

management body can be either in the form of a board 

or individual director. 

Accountability A JSC must make public its annual report and 

balance sheet. 

Liquidation & Reorganisation A voluntary liquidation or reorganization is upon a A voluntary liquidation or reorganization is upon the 

decision of a general shareholders’ meeting. A JSC decision of a general meeting of participants. A LLC 

may be reorganized into a LLC. 

may be reorganized into a JSC. 

Tax Identical tax treatment (except in case of distribution of net profits). 

ANNEXES 

191


Annex 3: The list of types of activities requiring special permissions (licenses) and amount of state duty to be paid for 

issue of special permissions (licenses) for such activities. 

Name of type of activity Authority to issue a license Amount of state duty (AZN) 

Private security activity Ministry of National Security of the Azerbaijan Republic (to ensure 

the safety of legal entities, formed on the territory of the Azerbaijan 

Republic by foreign legal entities or foreigners or stateless 

persons, including legal entities, established with direct or indirect 

participation of the foreign capital); 

Ministry of Internal Affairs of the Azerbaijan Republic in other cases 3000 

Cartographic activities State Committee of the Azerbaijan Republic on Land and 

Cartography 1100 

Storage and disposal of radioactive and Ministry of Ecology and Natural Resources of the Azerbaijan 

ionized waste 

Republic 1100 

Utilization and neutralization of toxic waste Ministry of Ecology and Natural Resources of the Azerbaijan 

Republic 1100 

Purchase, processing and sale of nonferrous 

metals and industrial waste 

including precious metals and stones Ministry of Economic Development of the Azerbaijan Republic 2200 

Sale of oil products Ministry of Fuel and Energy of the Azerbaijan Republic 5500 

Sale of gas products Ministry of Fuel and Energy of the Azerbaijan Republic 5500 

Medical activities Ministry of Health of the Azerbaijan Republic 5500 

Pharmaceutical activities Ministry of Health of the Azerbaijan Republic 5500 

Ethyl (potable) alcohol and strong drinks: 

(wine, cognac, vodka and other strong 

drinks, list of which is established by the 

Cabinet of Ministers of the Azerbaijan 

Republic): 

production Ministry of Agriculture of the Azerbaijan Republic 5500 

import 11000 

City and region executive organs (with the exception of city 

sale 

districts) 220

Tobacco goods: 

production Ministry of Agriculture of the Azerbaijan Republic 5500 

import 11000 

City and region executive authority (with the exception of city 

sale 

districts) 220 

The development, production, sale, 

purchase, import and export of technical 

facilities for illegal reception of information 

by legal and natural persons non-authorized 

for the fulfillment of investigation activities Ministry of National Security of the Azerbaijan Republic 2200 

Carriage of passengers and cargo by sea Ministry of Transport of the Azerbaijan Republic 5500 

Carriage of passengers and cargo by air Civil Aviation Public Administration of the Azerbaijan Republic 5500 

Communication service: 

telephone (wire) 5000 

cellular (mobile) 11000 

radio trunk and wireless 5000 

arrangement of internal 

telecommunication channels 5000 

Ministry of Communications and Information Technologies 

arrangement of international 

of the Azerbaijan Republic 

telecommunication channels 11000 

IP-telephony 8000 

data communications 6000 

ANNEXES 

express postal service 2500 

mobile communication service of 3rd 

generation (3G) 11000 

Activities in the field of projection and 

production of data protection facilities Ministry of National Security of the Azerbaijan Republic 2200 


193



issue of special permissions (licenses) for such activities, continued from the previous page. 

Activities of educational institutions: 

infant schools 2500 

general education schools (including 

lyceums and gymnasiums), vocational 

schools and professional lyceums, 

Ministry of Education of the Azerbaijan Republic 

colleges) 4000 

higher education institutions 5500 

secondary-special religious education 

institutions 4000 

higher religious education institutions 5500 

The activities on assistance to the 

Azerbaijan Republic citizens to get the job in Ministry of Labor and Social Protection 

foreign countries 

of People of the Azerbaijan Republic 2200 

Banking activities: 

banks 22000 

non-bank credit institutions National Bank of the Azerbaijan Republic 

1100 

Activities of non-governmental social funds Ministry of Finance of the Azerbaijan Republic 11000 

Activities in insurance sector: 

insurance activities 22000 

reinsurance activities 22000 

insurance broker activities 

insurance brokers - legal entities Ministry of Finance of the Azerbaijan Republic 

22000 

insurance brokers - natural persons 1000 

insurance agents activities: 

insurance agents - legal entities 1000 

insurance agents - natural persons 200

Auditing activities Chamber of Auditors of the Azerbaijan Republic 2200 

Activities of commodity exchange Ministry of Economic Development of the Azerbaijan Republic 11000 

Activities of stock exchange State Committee for Securities of the Azerbaijan Republic 11000 

Activities of investment fund State Committee for Securities of the Azerbaijan Republic 11000 

Activities of professional participants of 

equity market (brokers, dealers, securities 

management, determination of mutual 

obligations (clearing), deposit, register of 

holders of securities, organization of trade in 

equity market) State Committee for Securities of the Azerbaijan Republic 5500 

Activities on production and sale of all types 

of securities State Committee for Securities of the Azerbaijan Republic 5500 

Manufacturing of strict accounting blanks Ministry of Finance of the Azerbaijan Republic 2200 

Production of various seals and stamps Ministry of Internal Affairs of the Azerbaijan Republic 2200 

Tourist activities Ministry of Culture and Tourism of the Azerbaijan Republic 5500 

ANNEXES 

Customs broker activity Azerbaijan State Customs Committee 11000 

Establishment of bonded warehouses, short 

term storehouses, free warehouses Azerbaijan State Customs Committee 11000 

Broadcasting (broadcasting activity, 

auxiliary information broadcasting, 

cable network broadcasting, satellite 

broadcasting, activity, ensuring satellite 

broadcasting of foreign radio and television 

channels by means of coding devices) National Council of Television and Radio Broadcasting 11000 

Gathering of raw material of wild medicinal Ministry of Ecology and Natural Resources 

plants 

of the Azerbaijan Republic 550 

Production, export-import, transit traffic of 

precursors Ministry of Public Health of the Azerbaijan Republic 550 


195




Passengers and cargo transportation by 

motor transport: 

intercity (intra-district) passengers 

transportation 150 

long-distance (interregional) 

passengers transportation 150 

international passengers 

Ministry of Transport of the Azerbaijan Republic 

transportation 150 

passengers transportation 

by motor cars - taxis: 150 

local cargo transportation 150 

international cargo transportation 200 

Activity of hotels and hotel type objects Ministry of Culture and Tourism of the Azerbaijan Republic 1500 

Transportation of hazardous cargo by 

transport facilities 

550 

Installation and exploitation of the liquid and 

natural gas plants 2200 

Field operations, mining and drilling works 2200 

Installation and repair of elevators 550 

Installation and repair of attractions 2500 

Installation, set-up and repair of power 

plants, equipment and facilities 2500 

Production, installation and repair of 

hoisting facilities, metallurgical plants, 

boilers, vessels, operating under pressure 2500 

Diagnostics and other maintenance 

Ministry of Extraordinary Situations of the Azerbaijan Republic 

inspection of the equipment and technical 

plants, using at the potentially hazardous 

facilities 2500

Fire protection on the basis of agreement of 

the companies and settlements 3600 

Production and purchase of the fire fighting 

equipment and conducting of tests 3600 

Installation of fire protection systems and 

facilities, their repair and maintenance 3600 

Repair and servicing of fire protection 

equipment, primary fire fighting appliances, 

restoration of fire fighting appliances 

performance 3600 

Construction, reconstruction and repair of 

fire protection buildings, constructions and 

Ministry of Extraordinary Situations of the Azerbaijan Republic 

premises 3600 

Engineering-prospecting works as per 

Buildings and structures with I and II level 

of responsibility according to the state 

standards 1100 

Civil and erection works as per buildings and 

structures with I and II level of responsibility 

according to the state standards (except for 

private houses and summer cottages with 

height up to 12 meters): 

height up to 40 meters 1100 

height up to 65 meters 2200 

ANNEXES 

height up to 65 meters and higher 3300 

Creation of biometric technologies and Ministry of Communication and Information Technologies of the 

maintenance of such technologies Azerbaijan Republic 2200 

Building and structures design with I and II 

level of responsibility according to the state State Committee for City Planning and Architecture 

standards 

of the Azerbaijan Republic 1100 


197




Precious metals and stones 

5000 

production (extraction of precious 

metals from ore, concentrates) 5000 

processing and use (production and 

repair of jewelry and other items from 

Ministry of Finance of the Azerbaijan Republic 

precious metals and stones) 5000 

turnover (retail and wholesale, purchase 

of precious metals and stones, jewelry 

and other items produced from them 

from the population) 5000 

Activities for the private veterinary medicine 

150 

Veterinary medicines: 

Ministry of Agriculture of the Azerbaijan Republic 

production 3000 

sale 220 

The list of the types of activities to be granted special permissions (licenses) by the executive organs of the Nakhchivan 

Autonomous Republic 

The activities on assistance to the Azerbaijan Republic citizens to get the 

job in foreign countries. 

Design of buildings and constructions of the I and II levels of responsibility 

in accordance with state standards and engineering survey. 

Sale of oil and gas products. Auditing activities. 

Medical and pharmaceutical activities. Activities on production and sale of all types of security forms. 

Ethyl alcohol and strong drinks. Production and import. Production of various seals and stamps. 

Tobacco goods: Production and import. Tourist activities. 

Communication service (telephone, cellular, paging, radio relay, 

setting and operation of cable television, express postal service). Gathering of the raw materials of wild medicinal plants. 

International (according to the international treaties of the Azerbaijan 

Republic), intercity and local passengers and cargo transportation by 

motor transport. 

Activities of educational institutions (secondary, vocational schools 

and academies).

Annex 4: Double Taxation Treaties. 

Country Signature date Effective Date Country Signature date Effective Date 

Austria 04.07.2000 23.02.2001 Japan 30.05.2005 11.04.2008 

Belarus 08.08.2001 29.04.2002 Kazakhstan 16.09.1996 07.05.1997 

Belgium 18.05.2004 12.08.2006 Kingdom of the Netherlands 22.09.2008 

Bulgaria 12.11.2007 25.11.2008 Latvia 03.10.2005 19.04.2006 

Canada 07.09.2004 23.01.2006 Lithuania 02.04.2004 13.11.2004 

China 17.03.2005 17.08.2005 Moldova 27.11.1997 28.01.1999 

Czech Republic 24.11.2005 16.06.2006 Norway 24.04.1996 19.09.1996 

Estonia 30.10.2007 27.11.2008 Poland 26.08.1997 20.01.2005 

Finland 29.09.2005 29.11.2006 Qatar 28.08.2007 11.03.2008 

France 20.12.2001 01.10.2005 Republic of Korea 19.05.2008 25.11.2008 

Georgia 18.02.1997 01.12.1997 Romania 29.10.2002 29.01.2004 

Germany 25.08.2004 28.12.2005 Russia 03.07.1997 03.07.1998 

Grand Duchy of Luxembourg 16.06.2006 02.07.2009 State of Kuwait 10.02.2009 

Great Britain and Northern Ireland 23.02.1994 29.09.1995 Switzerland 23.02.2006 13.07.2007 

Hashemite Kingdom of Jordan 05.05.2008 Tajikistan 13.08.2007 11.02.2008 

Hellenic Republic (Greece) 16.02.2009 Turkey 09.02.1994 01.09.1997 

Hungary 18.02.2008 15.12.2008 Ukraine 30.07.1999 03.07.2000 

ANNEXES 

Islamic Republic of Iran 10.03.2009 United Arab Emirates 20.11.2006 25.07.2007 

Islamic Republic of Pakistan 10.04.1996 Uzbekistan 27.05.1996 02.11.1996 

Italy 21.07.2004 

199


Annex 5: Summary of some of characteristics relating to Azerbaijani taxes. 

Rate Payers Taxable Base Exemptions 

Profit Tax generally - 22%, All enterprises (resident and non- Difference between income and • profit of charity organizations 

since 01.01.2010 - 20% 

resident). Resident enterprises are deductible expenses. In case of a (except from entrepreneurial 

subject to tax on its total profit. PE gross income generated from activity); 

Non-resident enterprises operating Azerbaijani sources through a • grants, membership fees and 

in Azerbaijan through permanent PE less the amount of expenses donations received by non- 

establishments (‘PE’) are subject to incurred with respect to such commercial organizations; 

tax on profit from such operations. income. 

• income of international, 

interstate and intergovernmental 

organizations (except from 

entrepreneurial activity) etc. 

Income tax of employees. Enterprises or entrepreneurs Any salaries, payments or benefits • Income of diplomats or consular 

Sliding scale (14% - 35%) making payments to employees. received by an employee in respect employees who are not citizen of 

Payments made by the PE of of employment. 

Azerbaijan; 

non-residents are treated the 

• employment income of a person 

same as the payments of resident 

who is not a citizen of Azerbaijan, 

enterprises. 

whose stay in Azerbaijan during 

the tax year (the same as the 

calendar year) is less than 182 

days - if this income is paid by 

an employer or in the name of an 

employer who is not a resident 

of Azerbaijan and is not paid by 

or on behalf of a PE of a nonresident; 

• gifts, material aid and 

inheritance up to certain limits; 

• compensation for damage caused 

etc.

The gross income of a non-resident 

from an Azerbaijani source 

not attributable to a PE of the 

non-resident on the territory of 

Azerbaijan is subject to taxation 

at the source of payment, without 

deduction of expenses. 

Value of goods, works, and 

services provided and value of 

taxable import. 

Enterprises or entrepreneurs 

making payments to non-residents. 

Payments made by the PE of 

non-residents are treated the 

same as the payments of resident 

enterprises. 

Withholding Taxes from income of 

non-residents 4%, 6%, 10% and 

14% depending on type of income 

• The cost of property purchased 

from state enterprises in the 

course of privatization; 

• the provision of financial services 

(including a financial lease); 

• contributions to a Charter Fund 

etc. 

The following are subject to ‘0’ 

(zero) rate: 

• The purchase of goods or 

services, or importation thereof, 

with the proceeds of foreign 

grants; 

• Exports, etc. 

• Transit transportation of 

goods through the territory of 

Azerbaijan; 

• temporary imports of goods into 

Azerbaijan except for goods 

intended for re-export; 

• gods that are intended for 

re-export and secured under a 

pledge etc. 


Value Added Tax (VAT) 0 and 18% Any person registered or required 

to register as a VAT payer. There is 

a requirement to register for VAT 

purposes if turnover of a taxpayer 

exceeds a certain threshold. 

Persons importing goods to which 

VAT applies are considered payers 

of VAT on goods so imported. 

Release of excise goods produced 

in Azerbaijan and import of excise 

goods into Azerbaijan. 

Excise goods are spirits, beer 

and all kinds of alcohol, tobacco 

products, and petroleum products. 

All persons engaged in the 

production of excisable goods in 

Azerbaijan or importation of such 

goods into Azerbaijan. 

Excise Tax, various rates (per unit, 

volume etc) 

ANNEXES 

201


Annex 5: Summary of some of characteristics relating to Azerbaijani taxes, continued from the previous page. 

• facilities that are used for 

environmental preservation, 

fire protection or civil defence 

purposes; 

• pipelines carrying products, rail 

and motorways, communication, 

power transmission lines, 

irrigation system facilities etc. 

For the physical individuals 

buildings owned by resident 

and non-resident individuals in 

the Republic of Azerbaijan, plus 

watercraft and aircraft owned by 

resident individuals, for the legal 

entities carrying out business 

activities in Azerbaijan through its 

permanent establishment – annual 

average value of only those fixed 

assets which are related to the PE 

All persons and legal entities 

having assets (buildings or 

their part, fixed assets etc.) in 

ownership. 

Assets Tax. Different rates depend 

on type of assets. 

0.1% of the property with the 

values exceeding AZN 5,000—for 

individuals. 1% of the value of fixed 

assets - for legal entities; Other 

rates are applicable for possession 

of watercrafts and air crafts. 

• Land plots of residential area of 

common use; 

• national border zones and land 

designated for defence purposes 

etc 

Land plots granted for use or 

ownership. 

All persons owning or using land in 


Land Tax. Different rates depend 

on location and type of land plots. 

Commercial minerals extracted 

from subsoil strata in the territory 

of Azerbaijan (including Azerbaijan 

sector of the Caspian Sea). 

Mining Tax (Royalty) 3% - 26% All persons engaged in extraction 

of commercial minerals from 

subsoil strata (including Azerbaijan 

sector of the Caspian Sea) 

Vehicles that belong to foreign 

states, or owned or used by 

persons in the territory of the 

Republic of Azerbaijan and enter 

the territory of the Republic of 

Azerbaijan 

Non-resident enterprises and nonresident 

individuals that own motor 

vehicles that enter the territory of 

Azerbaijan and use this territory 

for passenger and cargo transport; 

also persons owning or using 

motorcars, buses or other motor 

vehicles in Azerbaijan 

Enterprises and individuals with a 

quarterly turnover not exceeding 

certain limit (currently 22,500 

manats – around 28,125 USD) 

Road Tax. Different rates 

depending on type and capacity 

of the vehicle, number of seats, 

distance travelled etc. 

• Exempt from payments of VAT, 

assets and profit taxes. 

Total proceeds realized by a 

taxpayer from sale of goods or 

services and from activities nonrelated 

to sales. 

Simplified System Tax 4% for 

taxpayers operating in Baku and 

2% for taxpayers operating in other 

regions

Annex 6: Major products of agriculture statistics 

Crop production 

Cereals and 

Vegetables 

Sunflower for 

Years dried pulses Cotton Tobacco Potatoes Vegetables and melons Sugar beets seed 

All categories of farms 

1985 1297.9 787.8 60.0 219.7 872.2 48.6 - - 

1990 1413.6 542.9 52.9 185.2 856.2 67.5 - 0.6 

1995 921.4 274.1 11.7 155.5 424.1 41.9 28.1 0.7 

1996 1018.3 274.4 11.2 214.6 570.0 52.1 46.1 0.6 

1997 1127.1 124.6 15.1 223.4 495.4 57.1 33.7 1.1 

1998 950.3 112.9 14.6 312.5 502.3 78.8 41.4 1.0 

1999 1098.3 96.8 8.6 394.1 670.8 206.3 42.2 2.3 

2000 1540.2 91.5 17.3 469.0 780.8 261.0 46.7 3.7 

2001 2016.1 83.6 12.7 605.8 916.4 290.9 41.3 5.1 

2002 2195.9 80.4 3.3 694.9 974.6 330.3 115.8 10.8 

2003 2057.8 99.6 4.7 769.0 1046.3 356.7 128.9 18.3 

2004 2158.2 135.7 6.5 930.4 1076.2 355.3 56.8 14.3 

2005 2126.7 196.6 7.1 1083.1 1127.3 363.8 36.6 16.1 

2006 2078.9 130.1 4.8 999.3 1186.4 362.1 167.2 15.9 

2007 2004.4 100.1 2.9 1037.3 1227.3 417.6 141.9 13.4 

2008 2498.3 55.4 2.5 1077.1 1228.3 407.7 190.7 16.5 

ANNEXES 

Agricultural enterprises and other organizations 

1985 1281.6 787.8 60.0 106.9 648.4 31.3 - - 

1990 1396.3 542.9 52.9 55.3 479.3 37.7 - 0.6 

1995 888.3 269.4 11.7 8.7 71.8 16.1 27.4 0.5 


203


Annex 6: Major products of agriculture statistics, continued from the previous page. 

1996 864.1 261.9 10.8 8.2 69.3 17.2 38.2 0.4 

1997 760.2 105.9 11.8 5.4 29.4 11.4 19.7 0.8 

1998 324.1 65.5 7.4 8.1 35.6 16.5 14.1 0.5 

1999 176.4 25.3 0.7 10.2 39.3 24.1 1.1 0.6 

2000 78.2 7.2 0.7 0.6 12.1 2.6 1.3 0.2 

2001 71.2 3.8 0.7 0.6 9.5 1.6 0.1 0.2 

2002 66.1 3.8 0.3 2.2 7.6 1.8 0.5 0.3 

2003 50.2 3.2 0.3 0.9 8.1 1.9 0.2 0.3 

2004 55.6 4.5 0.3 1.2 8.1 1.8 0.1 0.2 

2005 58.6 5.0 0.4 1.7 8.2 2.2 1.8 0.3 

2006 49.5 4.2 0.0 1.8 6.0 2.8 3.8 0.2 

2007 53.3 4.2 0.1 1.3 8.0 5.2 4.9 0.5 

2008 86.5 4.6 0.5 1.8 13.9 4.9 30.8 0.3 

Private owners, family peasant farms and households 

1985 16.3 - - 112.8 223.8 17.3 - - 

1990 17.3 - - 129.9 376.9 29.8 - 0.0 

1995 33.1 4.7 - 146.8 352.3 25.8 0.7 0.2 

1996 154.2 12.5 0.4 206.4 500.7 34.9 7.9 0.2 

1997 366.9 18.7 3.3 218.0 466.0 45.7 14.0 0.3 

1998 626.2 47.4 7.2 304.4 466.7 62.3 27.3 0.5 

1999 921.9 71.5 7.9 383.9 631.5 182.2 41.1 1.7 

2000 1462.0 84.3 16.6 468.4 906.9 289.3 41.2 4.9 

2002 2129.8 76.6 3.0 692.7 967.0 328.5 115.3 10.5 

2003 2007.6 96.4 4.4 768.1 1038.2 354.8 128.7 18.0

2004 2102.6 131.2 6.2 929.2 1068.1 353.5 56.7 14.1 

2005 2068.1 191.6 6.7 1081.4 1119.1 361.6 34.8 15.8 

2006 2029.4 125.9 4.8 997.5 1180.4 359.3 163.4 15.7 

2007 1951.1 95.9 2.8 1036.0 1219.3 412.4 137.0 12.9 

2008 2411.8 50.8 2.0 1075.3 1214.4 402.8 159.9 16.2 

Annex 7: Goods carried in transport sector (thousand ton) 

2007 2008 

Road Railway Sea Road Railway Sea 

Titles of cargoes 

Products of agriculture, hunting, and forestry; fish and other fishing products 7673.2 2299.9 651.5 8271.7 2010.9 616.0 

Coal and lignite; peat; crude petroleum and natural gas; uranium and thorium 1504.4 6471.7 3452.1 1621.7 5056.6 5403.3 

Metal ores and other mining and quarrying products 43228.0 5654.5 600.1 46599.8 5908.1 451.1 

Food products, beverages and tobacco 3684.8 1342.2 113.8 3972.2 1306.2 107.3 

Textiles and textile products; leather and leather products 142.9 33.6 8.3 154.0 39.1 1.3 

Wood and products of wood and cork (except furniture); articles of straw and plaiting materials; 

pulp, paper and paper products; printed matter and recorded media 2784.0 1076.2 0.1 3001.2 1175.4 ... 

ANNEXES 

Coke, refined petroleum products and nuclear fuel 4829.0 6797.6 3326.0 5205.7 6639.2 3546.4 

Chemicals, chemical products, and man-made fibers; rubber and plastic products 612.5 431.9 174.3 660.3 550.5 104.2 


205


Annex 7: Goods carried in transport sector (thousand ton), continued from the previous page. 

2007 2008 

Road Railway Sea Road Railway Sea 

Titles of cargoes 

Basic metals; fabricated metal products, except machinery and equipment 1630.7 1178.2 502.8 1757.9 1306.6 429.4 

Machinery and equipment n.e.c.; office machinery and computers; electrical 

machinery and apparatus n.e.c.; radio, television and communication equipment and 

apparatus; medical, precision and optical instruments; watches and clocks 630.6 31.9 22.6 679.8 27.9 62.9 

Transport equipment 190.3 95.4 141.0 205.1 98.4 127.1 

Furniture; other manufactured goods n.e.c. 738.7 9.1 0.4 796.3 8.1 0.3 

Secondary raw materials; municipal wastes and other wastes not specified elsewhere 

in CPA 1522.5 5.0 ... 1641.3 0.9 ... 

Mail, parcels ... ... ... ... ... ... 

Equipment and material utilized in the transport of goods 36.0 18.4 ... 38.8 18.0 0.1 

Goods moved in the course of household and office removals; baggage transported 

separately from passengers; motor vehicles being moved for repair; other non-market 

goods n.e.c. 639.6 3.2 1.6 689.5 2.3 1.4 

Grouped goods: a mixture of types of goods which are transported together 1108.2 ... ... 1194.6 2.0 ... 

Unidentifiable goods: goods which for any reason cannot be identified and therefore 

cannot be assigned to groups 01-16. 495.4 ... ... 534.0 ... 

Other goods n.e.c. 1423.7 63.7 1042.3 1534.3 51.0 857.3

Annex 8: Consular fees for Azerbaijani visas 

Activity Duty 

An ordinary entry-exit visa upon the address of a private entity engaged in economic activity or/and of a public entity 

(from 3 days up to 3 months): 40 USD 

Double entry-exit visa 80 USD 

Multiple entry-exit visa (up to 1 year) registration upon the address of a public body or private entity 250 USD 

Visa to privately studying students 

Tourist visa 20 USD 

Ordinary transit visa 20 USD 

Double transit visa 40 USD 

Visa extension: 

24 hours 10 USD 



ANNEXES 

from 3 days up to 1 month 40 USD 

from 1 months to 3 months 80 USD 

overdue visas, for each months 50 USD 

207

This publication prepared by: 

AZERBAIJAN EXPORT & INVESTMENT PROMOTION FOUNDATION 

11, H. Abdullayev Str., Baku, Azerbaijan, AZ1001 

phone: +994 12 598 0147 

fax: +994 12 598 0152 

e-mail: office@azpromo.az 

www.azpromo.az 

AZPROMO established by: 

MINISTRY OF ECONOMIC DEVELOPMENT OF THE REPUBLIC OF AZERBAIJAN 

40, U.Hajibayov str., “The Government House”, 

Baku, Azerbaijan, AZ1000 

phone: +994 12 493 8867 

fax: +994 12 492 5895 

e-mail: office@economy.gov.az 

www.economy.gov.az

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