Opening a Business in Azerbaijan: What You Need to Know

Today we will talk with you about how to open a business in Azerbaijan in general, what you need to know, what you need to do in order to be a full-fledged businessman.

There are two main ways that are the most common in Azerbaijan: individual entrepreneurship and opening a company.

The difference between the first and the second is that in the case when you are an individual entrepreneur, you do not open a new legal entity. You conduct all your activities in your own name and bear full responsibility for all your activities yourself. Usually, individual entrepreneurs choose micro and small businesses.

And in the case of a company, you are already a founder and director of a legal entity.

Opening a Business in Azerbaijan for Foreigners

Since we are focused on the issues of opening a company and business for foreigners, opening individual entrepreneurship for foreigners will be quite difficult technically. It is structured in such a way that in order for you to obtain the status of an individual entrepreneur, you must register as a taxpayer. In order for you to register as a taxpayer, you must already have a temporary residence permit.

One of the grounds for obtaining a temporary residence permit is the status of individual entrepreneurship. Because of this, we have such a loop.

As a result, if for some other reasons you were able to obtain the status of a temporary residence permit — for example, your spouse is a citizen of Azerbaijan and you obtained a temporary residence permit on this basis, you invested money, you bought an apartment, or in other ways you already obtained the status of temporary residence — you can open individual entrepreneurship.

In all other cases, the way of opening a company will suit you.

How to Open a Company in Azerbaijan

What else is better about opening a company compared with individual entrepreneurship?

The thing is that when opening a company, you already automatically obtain a basis for obtaining a temporary residence permit. Thus, you kill two birds with one stone.

The most common form of company in Azerbaijan is a limited liability company. It is called MMJ here. In fact, the legal status is identical to such limited liability companies as in Russia, Ukraine, and other CIS countries.

In order to open a limited liability company, we have simplified methods. You apply through the one-stop shop, you apply to ASAN, this is a state body for receiving citizens. You apply either to the Ministry of Taxes, where they can receive you, or you can even send your application online.

Among the documents, we have an application, a decision to open a limited liability company, the charter, a copy of your identity document, and, in principle, if you decided to pay the charter capital immediately, then also the receipt for the charter capital.

Opening a Bank Account for a Business in Azerbaijan

Another document that I would like to draw attention to is permission for the legal address. According to the letter of the law, this permission is not required, but I strongly recommend that you obtain this permission. It will subsequently serve you well.

After you have already opened the company, the next stage is opening a bank account.

For this, with the help of the electronic system, you apply to the tax authorities. They also electronically send permission to open bank accounts. The banks themselves, literally after about three days, you go to the bank and open an account there.

Another stage is obtaining a seal. It even comes earlier than opening a bank account and obtaining an electronic signature.

Tax Benefits and Startup Certificate for Businesses in Azerbaijan

But the thing is that technically it is arranged in such a way that they will not give you an electronic signature without a temporary residence permit. And in order for you to be able to obtain a temporary residence permit, you must open a company.

You submit, within 20 working days, they will give you a temporary residence permit if the migration authorities consider that your activity is sufficient, that it is a sufficient basis to give such a permit.

In principle, we also have such forms of legal organization as an open joint-stock company, a closed joint-stock company, a partnership, but they are less popular.

If you have a large business, if you know that you will immediately receive a large profit, you will have large dividends, then you can even open a closed joint-stock company or an open joint-stock company.

There are slightly different tax rates there, there are slightly different requirements for the charter capital. There is a minimum, unlike a limited liability company, where there is no minimum requirement for the minimum charter capital.

But this method can also be considered.

Besides this, I will also touch upon the primary tax issues.

That is, if your activity falls within the IT industry, then you can also qualify for additional benefits, obtain a startup certificate by applying to the Ministry of Taxes.

For this, you must have innovative activity. You must fill out a business plan and, with all the main documents, submit it to the tax authorities in order to obtain this status.

In principle, that is all about opening a company and business.

We will be glad to cooperate with you.

FAG

Can Foreigners Open a Business in Azerbaijan?

Yes, foreigners can open a business in Azerbaijan. For foreigners, opening a company is generally a more suitable option than individual entrepreneurship because individual entrepreneurship requires registration as a taxpayer and a temporary residence permit.

What Is the Most Common Type of Company in Azerbaijan?

The most common form of company in Azerbaijan is a Limited Liability Company (LLC), known locally as an MMJ.

How Can I Open a Company in Azerbaijan?

To open a company in Azerbaijan, you generally need to submit an application, a decision to establish the company, the company charter, and a copy of your identity document.

Can Opening a Company in Azerbaijan Help Me Get a Temporary Residence Permit?

Opening a company in Azerbaijan can provide a basis for applying for a temporary residence permit, subject to the relevant requirements of the migration authorities.