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The document ceased to be valid since July 28, 2022 according to the Law of the Azerbaijan Republic of June 22, 2022 No. 551-VIQ

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LAW OF THE AZERBAIJAN REPUBLIC

of January 15, 1992 No. 57

About protection of foreign investments

(as amended on 28-12-2018)

This Law determines the legal and economic principles of implementation of foreign investments in the territory of the Azerbaijan Republic. The law is directed to attraction and effective use in the national economy of foreign material and financial resources, the advanced foreign equipment and technology and managerial experience and guarantees protection of the rights of foreign investors.

Section 1. General provisions

Article 1. Legislation on foreign investments

1.1. The relations connected with foreign investments in the territory of the Azerbaijan Republic are regulated by this Law, other legal acts and international treaties of the Azerbaijan Republic.

1.2. The relations in the sphere of protection of foreign investments in the Alyatsky free economic zone are governed according to requirements of the Law of the Azerbaijan Republic "About the Alyatsky free economic zone".

Article 2. Foreign investors

Can be foreign investors in the Azerbaijan Republic:

a) foreign legal entities;

b) the foreign citizens, stateless persons and citizens of the Azerbaijan Republic having the permanent residence abroad; provided that they are registered for conducting economic activity in the country of their nationality or the permanent residence;

c) foreign states;

d) international organizations.

Article 3. Foreign investments and forms of their implementation

Foreign investments are all types of property and property rights, including the rights to the results of intellectual activities and other rights which are not relating to real, put by foreign investors in objects entrepreneurial and other types of activity for the purpose of profit earning.

Foreign investors can perform investments in the territory of the Azerbaijan Republic in the way:

a) equity in the companies, the organizations created together with legal entities and citizens of the Azerbaijan Republic;

b) creations of the companies which are completely belonging to foreign investors;

c) acquisitions of the companies, property complexes, buildings, constructions, shares in the companies, shares, bonds and other securities, and also other property which according to the legislation of the Azerbaijan Republic can belong to foreign investors;

d) acquisitions of rights of use of the earth and other natural resources, and also other property rights;

e) the conclusions of contracts with legal entities and citizens of the Azerbaijan Republic providing other forms of implementation of foreign investments.

Article 4. Participation of foreign investors in privatization and privatization

Foreign investors can participate in privatization of the state and municipal companies, and also objects of construction in progress on conditions and according to the procedure, the determined legislation of the Azerbaijan Republic.

Article 5. Legal regime of foreign investments

The legal regime of foreign investments, and also activities of foreign investors for their implementation cannot be less favorable, than the mode for property, property rights, and also investing activities of legal entities and citizens of the Azerbaijan Republic behind the withdrawals provided by this Law.

For foreign investments in priority industries of the national economy and in the separate territories additional benefits can be established by the legislation of the Azerbaijan Republic.

Control of execution of conditions of the contracts signed with the state companies and the organizations in the field of investment attraction is performed by relevant organ of the executive authority.

Article 6. Types of activity

The companies with foreign investments can perform any kinds of activities if they are not forbidden by legal acts of the Azerbaijan Republic.

The companies with foreign investments can be engaged in separate types of activity which list is determined by relevant organ of the executive authority, only based on special consent (license).

Article 7. Territorial restrictions for foreign investments

By legal acts of the Azerbaijan Republic the territories in which activities of the companies with foreign investments are limited or forbidden, proceeding from reasons of ensuring defense, homeland security, protection of the surrounding environment and protection of the population can be determined.

Article 8. Coordination of investing activities

Development and implementation of measures for attraction and use of foreign investments, coordination of investing activities, assistance to foreign investors and the companies with foreign investments are performed by relevant organ of the executive authority of the Azerbaijan Republic.

Section 2. State guarantees of foreign investments

Article 9. Legal protection of foreign investments

Foreign investments in the Azerbaijan Republic use complete and unconditional legal protection which is provided with this Law, other legal acts and international treaties of the Azerbaijan Republic.

Article 10. Guarantees from change of the legislation

If the subsequent legislation of the Azerbaijan Republic worsens investment conditions, the legislation existing at the time of implementation of investments is applied to foreign investments within ten years.

This provision does not extend to the changes of the legislation of the Azerbaijan Republic concerning ensuring defense, homeland security and public order, the credits and finance, environmental protection, morality and health of the population.

Article 11. Guarantees from nationalization and requisition

Foreign investments in the Azerbaijan Republic are not subject to nationalization, except the exceptional cases causing damage to the people and state interests of the Azerbaijan Republic. The decision on nationalization is made by the Supreme Council of the Azerbaijan Republic.

Foreign investments are not subject to requisition, except as specified natural disasters, accidents, epidemics, epizooty and under other circumstances having extreme character.

The decision on requisition is made by the Cabinet of Ministers of the Azerbaijan Republic.

In case of taking measures to nationalization and requisition adequate and effective compensation is immediately paid to the foreign investor.

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