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LAW OF THE AZERBAIJAN REPUBLIC

of July 14, 2026 No. 450-VIIQ

About crowd funding

This Law, according to Items 10-13 and 15 of part I of article 94 of the Constitution of the Azerbaijan Republic, regulates legal, organizational and economic basis of realization of crowd funding on the basis of the share and debt capital in the Azerbaijan Republic, requirements to activities of the operator of crowdfunding platform, and also questions of state regulation and control of their activities. The purpose of this Law - to provide to subjects of economic development, in particular startups, micro, small and medium entrepreneurs, convenient access to the operating and steady alternative channels of financing with use of information resources and systems, and also opportunities of the capital market, for the purpose of increase in their business activity and ensuring protection of the rights of the investors participating in financing.

Chapter 1. General provisions

Article 1. Basic concepts

1.1. The basic concepts used for the purposes of this Law have the following values:

1.1.1. crowd funding on the basis of debt instruments - the crowd funding assuming attraction of financial resources in exchange for acquisition by investors of the debt investment securities issued by the project owner for financing of the crowdfunding project on the conditions established by this Law;

1.1.2. cooling-off period - the period during which the individual investor can withdraw the investment offer without explanation of and without payment of any penalties during the term specified in article 16.3 of this Law;

1.1.3. key information leaf - the set of information reflecting the information specified in article 9.3.1 of this Law and opened on crowdfunding platform;

1.1.4. the individual investor - the investor who is not answering to criteria of the professional investor and in writing recognizing riskiness of investments;

1.1.5. Persons performing managerial functions - the head and members of the supervisory board (board of directors) (if that is available) and executive body of the legal entity;

1.1.6. crowd funding - mass financing of any crowdfunding project through crowdfunding platform for the purpose of attraction of financial resources from investors;

1.1.7. crowdfunding campaign - the announcement placed on Internet and information resource of crowdfunding platform for the purpose of fund raising, necessary for financing of the crowdfunding project;

1.1.8. the crowdfunding project - the offer placed on crowdfunding platform for the purpose of attraction of financial resources according to the procedure, established by this Law;

1.1.9. the crowdfunding agreement - the written agreement signed between investors and the project owner through crowdfunding platform;

1.1.10. crowdfunding platform (further - platform) - the information system managed by the operator open for public by means of which crowd funding by connection of investors with project owners is performed;

1.1.11. The project owner - the commercial legal entity registered in the Azerbaijan Republic and wishing to raise funds through platform;

1.1.12. The authorized capital - the capital determined according to this Law for ensuring continuous work of the operator;

1.1.13. Considerable share - immediate or indirect possession of shares, constituting 10 (ten) percent or more from the authorized capital or allowing to have significant effect on decision making of the legal entity in which she is participant under the agreement;

1.1.14. The operator - the legal entity managing platform according to requirements of this Law;

1.1.15. The professional investor - the investors determined in article 1.1.7-2 of the Law of the Azerbaijan Republic "About investment funds";

1.1.16. Crowd funding on the basis of shares - the crowd funding assuming attraction of financial resources in exchange for acquisition by investors of shares of the project owner for the purpose of financing of the crowdfunding project within the conditions established by this Law;

1.1.17. Civil immunity - lack of criminal records for intentionally the committed crime beneficial owners of the operator and the project owner, persons performing managerial functions, large shareholders (if such owner is legal entity, then head (members) of its executive body), lack of the judgment on deprivation of the right to hold certain position in the economic sphere or to be engaged in certain activities during the certain period of time, and also compliance of these persons to requirements of article 17.3 of the Law of the Azerbaijan Republic "About fight against legalization of the property received in the criminal way, and terrorism financing".

1.2. Other concepts used in this Law have the values established by regulatory legal acts of the Azerbaijan Republic.

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