On 20 February 2020, the Management Board of the Central Bank of the Republic of Azerbaijan approved amendments to the “Regulations on currency operations of residents of the Republic of Azerbaijan in foreign currency, and non‐residents in national and foreign currencies” (the “Amendments”), under which the foreign currency control regime was liberalized.
As per the rules previously in force, the residents of Azerbaijan had to import/receive the goods/services within 270 days for all payments made to abroad as advance payments. Failing to do so would result in 20-30% of the amount paid as advance payment. Under the Amendments, the previously prescribed 270 days for importing goods or obtaining services after advance payment to a foreign bank account has been increased to 2 years. In other words, an importer of goods or services into Azerbaijan is required to provide customs declaration of the imported goods/act of acceptance of the services to its bank within 2 years from the date of making advance payment for such goods and services.
The Amendments also removed the requirement on provision of information to the currency control authority (i.e. the Central Bank) for goods and services with the price less than USD 10,000 (ten thousand US Dollars) or an equivalent amount of other currency.
It should also be stated that violation of the above-mentioned rules of currency regime will trigger the commencement of administrative proceedings against the importer and the Central Bank may apply to the court to apply monetary sanctions in the amount of 20-30% of the payment made to an overseas bank account.
The Amendments entered into force on 28 February 2020 after being registered by the Ministry of Justice.
This article was prepared as a general information by the attorneys of Baku Attorneys & Consultants (BAC), Azerbaijani law firm. BAC is a full-service law firm based in Baku with a strong team of highly experienced attorneys and consultants, specialized in banking and finance laws. You may reach us via www.batco.az.
