Azerbaijan, Baku, August 6 / Trend I. Khalilova /
New rules of the Azerbaijani Cabinet of Ministers dated July 28, 2009 to regulate capital flow through the Azerbaijani border will not change order of cash currency transfer by physical entities- residents from Azerbaijan in accordance with the law Currency Regulation, the State Customs Committee said on August 6.
"Beginning from February 2008, each physical entity can take $10,000 thousand dollars in cash out of Azerbaijan without paying customs duties. And this procedure will be preserved. Before, amount exceeding $1,000 to $10,000 was imposed to customs duties to the amount of 1 percent", the Customs Committee said.
The Azerbaijani Central Bank has launched to draw up a list of countries. People coming from these countries will give detailed information about the origin of currency inflow/outflow (new rules will not cover countries not included in this list) upon new rules on Providing information to the Finance Monitoring Service under the Azerbaijani Central Bank on currency inflow/outflow dated July 28, 2009.
The countries to be included in the list will cover countries not requiring to disclose identification of information while conducting financial transactions, countries suspected of involvement in illicit drugs and psychotropic substances traffic, supporting extremism, armed separatism, transnational organized groups, financing terrorism, etc.
These countries will be determined by the Finance Monitoring Service. Countries unwilling to cooperate with FATF will be taken as basis.
Accounting form on inflow/outflow of cash currency will be approved for the Finance Monitoring Service under the Azerbaijani Central Bank upon decision of the Cabinet of Ministers dated July 28, 2009.
According to the decision, it is necessary to indicate source of its origin and acquiring while inflow/outflow of currency. The report includes surname, name and patronymic of owners of currency, citizenship and country of birth, country of acquiring currency, country to which currency is outflown, place and date, inflow/outflow, name and amount. The form can be used by customs agencies in the form of E-document. Inflow/outflow of currency is ceased by lack or incomplete filling of the form.
President of Azerbaijani Banks Association, Eldar Ismaylov, this decision of the government is connected with actions to implement the law Combating legalization of funds and property received illegally and financing of terrorism.
"At present, banking, business culture, audit, accounting improved in Azerbaijan. So, introduction of strict restrictions on capital flow, as it was in early 1990, are irrelevant," Ismayilov said.
Moreover, at present, large sum of money can be used outside the country through bank card. According to a source in State Customs Committee, change in use of bank cards is not expected to be made according to the world practice.
State Customs Committee said that regulations on inflow/outflow of foreign currency by physical entities dated April 2, 2002 will be preserved.
According to them, residents can inflow currency cash to Azerbaijan without limitation, informing the customs agencies.
Inflow of cash currency to Azerbaijan to the amount equivalent to $10,000, is officially documented by customs agencies via customs declaration of a passenger but a customs declaration of passenger and customs certificates - to the amount exceeding $10,000.
Residents may outflow from Azerbaijan earlier inflown cash currency to the amount equivalent to $50,000 by informing Customs agencies.
While exporting from Azerbaijan earlier inflown cash currency, residents must submit customs declaration of passenger to customs agencies (if amount of inflown cash currency does not exceed $10,000), as well as customs certificate (if the amount of inflown cash currency exceeds $10,000).
Regardless of these regulatory conditions, residents can outflow currency from Azerbaijan without producing document (except for stock exchange funds), equivalent to $10,000 per person, by informing customs agencies.
Residents leaving for foreign countries for a business trip, can outflow currency cash from the Azerbaijan Republic to cover travelling expenses to the amount indicated in documents (bank certificate on payment of travel expenses) confirmed by authorized bank organizations, dealing with departure of these people for a business trip .
Introduction of duty-free capital flow from the country was recommended by the World Trade Organization. The Azerbaijani Central Bank, as one of key regulators of exchange market, has agreed to introduce zero rate of customs duty that envisage liberalization of capital outflow.
According to rules Regime of currency transaction of residents and non-residents of the Azerbaijani Republic, residents can transfer capital to the countries of the Organization for Economic Cooperation and Development (OECD), to countries with which bilateral agreements on mutual promotion and protection of investments were signed, and to the Russian Federation (it is not OECD member and does not have agreement on protection of investment with Azerbaijan) for:
- transfer of direct investment to get profit, to deposit capital in authorized fund of organizations, to get right for participation in management of organizations;
- the acquisition of securities;
- payment of property right for land, buildings in this territory and other kinds of property referring to real estate, as well as for payment of other rights for real estate.
- investing deposits to the account of a resident in a foreign bank
Transfer of capital flow to other countries may be conducted upon individual permission of the Central Bank.
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