PRESIDENTIAL DECREE OF THE AZERBAIJAN REPUBLIC

of June 6, 2007 No. 586

About enhancement of safety and rational use of state-owned property

As a result of the purposeful actions held in recent years in the Azerbaijan Republic connected with execution of the state programs adopted in the sphere of privatization of state-owned property gained wide scope development of entrepreneurship in all spheres of economy, and the role of private sector in strengthening of economic power of the state considerably raised. And though now the specific weight of this sector in production of the gross domestic product approached 80 percent, the huge number of the companies and objects which are in state-owned property with property worth billions manats still is effective.

Observations show that in many cases in management of the state companies mistakes are made and rational use of the state-owned property which is at their disposal is not provided. So, in some companies it is possible to face such cases as evasion from registration of state-owned property, emergence of debts and collision with danger of bankruptcy because of these debts, groundless change of purpose of the parcels of land on which the companies are located. For these reasons the separate companies are past repair and stop the activities, their highly skilled workers and experts lose the workplaces.

For the purpose of enhancement of controling mechanisms by the state companies and use of state-owned property in modern conditions, efforts of the state control and increase in transparency in this sphere, ensuring acceleration of actions for restructuring and improvement of the state companies and organizations I decide:

1. Approve "The state program on enhancement of management of state-owned property in the Azerbaijan Republic" (it is applied - Appendix I).

2. Approve "Rules of control over investment investments in the companies privatized and transferring to the control" (it is applied - Appendix II).

3. Approve "Rules of preprivatization restructuring and improvement of the state companies" (it is applied - Appendix III).

4. Approve "Rules of transfer of the state shares in management of joint-stock companies" (it is applied - Appendix IV).

5. Approve in the new edition with modification and amendments the "Regulations on assessment of the privatized state-owned property" approved by the Presidential decree of the Azerbaijan Republic of December 23, 2000 at number 432 (it is applied - Appendix V).

6. Charge to Public service concerning property under the Ministry of Economics (further - Public service):

6.1. for the purpose of financing of the actions provided "By the state program on enhancement of management of state-owned property in the Azerbaijan Republic" to take adequate measures on attraction of financial resources of the government budget, the companies and organizations, grants and other financial aid;

6.2. once a year to inform the President of the Azerbaijan Republic and the Cabinet of Ministers of the Azerbaijan Republic on the works done in connection with accomplishment of the State Program;

6.3. provide holding effective actions for regulation in stipulated by the legislation procedure for debts of the privatized state companies;

6.4. take necessary measures for protection of state interests in lawsuits with the state companies and legal entities with share of the state in the authorized capital.

7. Charge to heads central and local executive bodies of the Azerbaijan Republic, the state companies and the organizations:

7.1. ensure safety of the state-owned property which is at their disposal and the parcels of land on which it is placed;

7.2. not allow without the consent of Public service carrying out construction, installation and other adjusting works on the parcels of land which are in state-owned property on which the state companies and objects are placed and to take the measures for elimination of the violations existing in this sphere corresponding to the legislation;

7.3. provide submission of data on the property which is on balance and bargains concluded concerning it in Public service for their timely entering into the Register of the State-owned Property;

7.4. take necessary measures for ensuring rational use of state-owned property, including non-admission of transfer of state-owned property to use to the third parties without availability of the lease agreement and write-off from balance of property, suitable for use;

7.5. provide in case of the inventory for debts, sales at the biddings and estimates of property of the state companies and legal entities from shares of the state in authorized the capital safety of state-owned property and its rational use, protection of state interests and prevention of cases of abuses.

8. To the Cabinet of Ministers of the Azerbaijan Republic within a month:

8.1. make corresponding changes to the existing regulatory legal acts about establishment of the minimum amount of payment for assessment of the privatized state-owned property and the parcels of land, and also the rent for leasing of real state-owned property (in addition to housing stock);

8.2. provide reduction in compliance with this Decree of regulatory legal acts of the Cabinet of Ministers and the relevant central executive bodies of the Azerbaijan Republic and inform on it the President of the Azerbaijan Republic;

8.3. prepare and provide to the President of the Azerbaijan Republic offers on strengthening of legal responsibility of officials of the state companies and organizations in connection with ensuring safety being on balance of data of the companies and organizations of property and its rational use;

8.4. approve form of the special report specified in Item 9.2 "The state program on enhancement of management of state-owned property in the Azerbaijan Republic" approved by Item 1 of this Decree and the list of subjects to specifying of data in it;

8.5. for the purpose of the rational organization of activities of central office the State committee on questions of imushchestvaa of its territorial subdivisions to resolve the issues connected with increase in number of their workers and improvement of their material logistics;

8.6. resolve other issues following from this Decree.

8-1. The questions arising from this Decree concerning the state companies entrusted in management of the Azerbaijani Investment Holding activities of "The Azerbaijani investment holding" of November 5, 2020 and the regulatory legal acts adopted according to these decrees are performed taking into account presidential decrees of the Azerbaijan Republic No. 1120 "About creation of the Azerbaijani Investment Holding" of August 7, 2020 and No. 1174 "About providing.

9. The "Regulations on assessment of the privatized state-owned property" approved by the Presidential decree of the Azerbaijan Republic of December 23, 2000 at number 432 (The collection of the legislation of the Azerbaijan Republic, 2000, No. 12, Article 844; 2001, No. 7, Article 470, No. 10, Article 640; 2002, No. 12, Article 725; 2003, No. 9, Article 475, No. 10, Articles 569, 585; 2004, No. 9, Article 678; 2005, No. 5, Article 400; 2006, No. 7, Article 590) to consider invalid.

10. This Decree becomes effective from the date of signing.

Appendix I

Approved by the Presidential decree of the Azerbaijan Republic of June 6, 2007

The state program on enhancement of management of state-owned property in the Azerbaijan Republic

Maintaining

Thanks to the social and political stability reached as a result of the policy pursued by the national leader of the Azerbaijani people Heydar Aliyev since 1996 in the Azerbaijan Republic consecutive economic reforms began to be undertaken, essential work in the direction of privatization of economy and carrying out basic changes and management system was done. The undertaken reforms served elimination of the state administrative intervention in the sphere of management of economy, restriction of monopoly over property and the state economic functions, to development of entrepreneurship and free economic activity, strengthening of economic power of the state and improvement of level of living of citizens. As a result of the done work today Azerbaijan takes the advanced place among the world countries on the increasing speed of economic development. In the country the economic system with the strong base relying on the principles of free market economy and social justice is created.

During the economic reforms undertaken in the Azerbaijan Republic certain achievements and in the sphere of forming of new management system were received by state-owned property. Consecutive events in the direction of enhancement of structure and activities of the executive bodies performing functions on implementation of state policy in the sphere of management of state-owned property were held. In last period special attention was paid to carrying out the institutional changes connected with use and the order of property as the most important structural elements of state policy on management of state-owned property.

At the same time in the conditions of the high economic growth reached in the country there is need for further enhancement of management of state-owned property. The existing controling mechanisms do not provide acceptance of the flexible reasoned decisions connected with rational use of state-owned property and management of it in certain cases. In the state companies and the companies the need for acceleration of institutional updates, broader attraction to this sphere of foreign investors, ensuring transparency becomes ripe during institutional changes.

With respect thereto there was need for application of new approaches for the solution of the questions connected with management of state-owned property in present conditions, enhancement of the mechanisms existing in this sphere. From this point of view the state program on enhancement of management of state-owned property to increase in effective management of state-owned property in the Azerbaijan Republic" (further - State Programs), prepared according to the legislation of the Azerbaijan Republic, and also the experience got in the sphere of management of state-owned property serves ".

I. General part

1. Purpose and main objectives of the State Program

The purpose of the State Program consists in increase in competitiveness of the state companies and achievement of more dynamic development of economy in general by increase in effective management of state-owned property, enhancement of the state control over safety and use of state-owned property.

The main objectives of the State Program are:

- creation of committed mechanisms of regulation in the sphere of management of state-owned property;

- ensuring safety and rational use of the property which is in use of the state companies and organizations;

- increase in management efficiency of the stocks (shares) of economic societies owned by the state;

- enhancement of the mechanism of transfer of state-owned property to management;

- achievement of development of the state companies by investment attraction, ensuring their preprivatization improvement.

2. Main directions of the State Program

According to the established main objectives in the State Program enhancement of management of state-owned property is provided in the following directions:

- enhancement of regulatory framework of management of state-owned property, creation of the system of accounting and registration meeting the modern requirements;

- enhancement of management of the stocks and shares of economic societies owned by the state;

- enhancement of mechanisms of control over use of state-owned property;

- restructuring, improvement of the state companies and economic societies and preparation them to privatization;

- forming of the mechanism of control over development of the state companies after privatization.

3. The results expected from application of the State Program

After execution of the State Program the following results are expected:

- forming of effective controling mechanisms state-owned property;

- increase in amount of the means from use of state-owned property arriving in the government budget;

- ensuring committed control over safety and protection of state-owned property, its rational use;

- increase in the volume of investment, attracted in the privatized state companies.

4. The actions plan on enhancement of management of state-owned property

4.1. The list of the specific actions for enhancement of management of state-owned property which are subject to implementation, terms of their accomplishment and bodies, responsible for execution, are specified in the Actions plan which is integral part of the State Program.

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