Study of Small and Medium Enterprises in Azerbaijan - IFC

View from an entrepreneur:
“I am a partner of a foreign company and one of the main requirements of my foreign
partners is the observance of all safety norms at the workplace. For the purpose of
receiving information and clear directives from the regulating agency, I visited the local
fire safety service management. On my request for all fire safety norms and standards,
the local management chief stated that this information is confidential and cannot be
disseminated, since it is reflected in the internal reporting and service codes. How, in your
opinion, can I ensure observance of those norms, which are required from me, if I have no
idea what they are?”
b) Requirements are based upon obsolete rules
Survey respondents frequently claimed there are some requirements that were used
in the past and possibly were relevant then, but as of today these requirements need
to be revised and modernized because of the changes in business activity.
View from an entrepreneur:
“Why do we need so many sinks for different products? Abroad, due to modern types of
detergent and cleaning means, it is allowed to use one kitchen sink for different items. But
according to our requirements, I have to install, at the minimum, three sanitary areas.
My café’s kitchen will be the size of the main hall, which is unrealistic.”
View from an entrepreneur:
“There are some norms for trade, which are basically leftovers from the Soviet period. It
is necessary to review these standard requirements, because when they were issued, the
term ‘private business’ was alien to everybody, the population in the cities was smaller,
and, correspondingly, the number of services was significantly lower, so the [requirements]
could be posted in the most suitable parts of town. There are no more ‘specialized’ places,
and we base ourselves as we find appropriate. Yet the old requirements exist and we
regularly pay the inspectors to get around these obsolete norms. We need to change the
legislation and stop this awful practice.”
c) The administrative fines often set up in a discretionary manner
Sometimes the size of the fine makes the unofficial payment a less costly i.e. an economic
option. The scale is only being communicated during the on-site inspection,
with an aim to stimulate the entrepreneurs to engage in discussions over an alternative
settlement.
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St u d y o f Sma l l a n d Me d i u m Ent e r p r i s es in Az e r b a i j a n