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RESOLUTION OF BOARD OF CENTRAL BANK OF THE AZERBAIJAN REPUBLIC

of February 22, 2023 No. 9/1

About approval "Procedure for application of measures of client compliance in case of wire transfer of financial resources

Based on article 4.2.3 of the Law of the Azerbaijan Republic "About fight against legalization of the property received in the criminal way, both terrorism financing" and article 22.0.17 of the Law of the Azerbaijan Republic "About the Central bank of the Azerbaijan Republic" the Board of the Central bank of the Azerbaijan Republic DECIDES:

1. Approve "Procedure for application of measures of client compliance in case of wire transfer of financial resources" it (is applied).

2. Approved by part of 1 this Resolution "Procedure for Application of Measures of Client Compliance in case of Wire Transfer of Financial Resources" becomes effective since June 1, 2023.

3. Charge to Legal department (Rena Melikova) in 3-day time to provide submission of this Resolution to the Ministry of Justice of the Azerbaijan Republic for entering into the State register of legal acts of the Azerbaijan Republic.

Approved by the Resolution of Board of the Central bank of the Azerbaijan Republic of February 22, 2023, No. 9/1

Procedure for application of measures of client compliance in case of wire transfer of financial resources

1. General provisions

1.1. This Procedure is prepared according to the laws of the Azerbaijan Republic "About fight against legalization of the property received in the criminal way, and terrorism financing" and "About address financial sanctions" and determines cases of taking measures of client compliance when making wire transfer of financial resources (further - wire transfer), and also requirements to data transmission in chain of wire transfers and to business relations between financial institutions.

1.2. Provisions of this Procedure extend to the cross-border and intra country wire transfers of the physical persons and structures provided by the Law of the Azerbaijan Republic "About address financial sanctions" (the legal entities, groups, the organizations which are not legal entities, the state or non-state bodies (structures)), performed through local banks, local branches of foreign banks and the national operator of mail service.

1.3. The translations in which the unique data allowing to identify the card on all operational chain upon purchase of products and services with use of payment cards are transferred both calculations and transfers between financial institutions in the purposes, wire transfer are not considered.

1.4. Except as specified, the stipulated in Article 4.17 Laws of the Azerbaijan Republic "About fight against legalization of the property received in the criminal way, and terrorism financing" in case of wire transfers it is possible to rely on earlier realized measures of client compliance, and it is not required to realize these measures repeatedly.

1.5. Irrespective of other provisions of this Procedure, financial institutes issuers, financial intermediary institutes and financial institutes beneficiaries, in addition to the measures established by this Procedure in case establishment by them when implementing wire transfers of the fact that the payer and the receiver of means is in the list of persons to whom address financial sanctions shall be applied shall take measures according to the laws specified in Item 1.1 of this Procedure.

1.6. The questions which are not settled by this Procedure when implementing wire transfers are regulated by acts of normative nature of the Central bank of the Azerbaijan Republic of clearing settlements and money transfers, and also making of foreign currency transactions.

2. Concepts

2.1. The concepts used in this Procedure have the following values:

2.1.1. financial institution - local banks, local branches of foreign banks and the national operator of mail service (except as specified when provisions in the text of the Procedure concern foreign financial institutions);

2.1.2. financial resources - the cost sent by the payer and paid by financial institute beneficiary to the receiver of means in cash;

2.1.3. wire transfer - the cross-border or intra country transaction made for the purpose of delivery by physical persons and legal entities by the electronic methods provided by financial institutions (through bank accounts, without opening of the account or new payment methods), financial resources to the receiver of means (in case of wire transfer by the payer and receiver of means there can be same person);

2.1.4. cross-border transfer - wire transfer between the financial institutions belonging to the different states (territories) (the concept of cross-border transfer extends also to serial payments, payments coverings and package payments, and also to cases when at least one of the financial institutes issuers, intermediaries or beneficiaries participating in chain of wire transfers belongs to the different states (territories));

2.1.5. the intra country translation - the wire transfer made by physical persons and legal entities through financial institutions within the Azerbaijan Republic (the concept of the intra country translation includes also serial payments, payments coverings and package payments);

2.1.6. serial payment - payment chain in which the financial institute issuer sends the payment order together with financial resources to financial institute beneficiary directly or through one or several financial intermediary institutes;

2.1.7. payment covering - payment chain in which the financial institute issuer sends the payment order to financial institute beneficiary directly, and financial resources according to the order - financial institute beneficiary through one or several financial intermediary institutes;

2.1.8. package payments - information transfer about the payer in the form of packet from financial institute issuer to financial institute beneficiary when making by one payer of several transactions of wire transfer.

2.1.9. the payer - the bank account holder disposing of electronic money transfer or person disposing of making of transaction without opening of the account;

2.1.10. the receiver of means - person in whose advantage wire transfer is made;

2.1.11. financial institute issuer - the financial institution accepting the payment order in case of wire transfer and sending financial resources;

2.1.12. financial intermediary institute - the financial institution participating in chain of wire transfer between financial institutes issuers and financial institutes beneficiaries in case of wire transfer;

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