At today's plenary session of the Milli Majlis (National Assembly), a draft law on harmonizing a number of existing laws with the upcoming law "On Financial Lease" was approved in its third reading.
According to Operative Information Center-OMM, the legislative package adapts several major codes and laws, including the Civil Code, Tax Code, Competition Code, and laws "On Insolvency and Bankruptcy", "On Grain", "On Private International Law", "On Tobacco and Tobacco Products", "On State Fees", "On State Registration and State Registry of Legal Entities", "On Banks", "On State Registry of Real Estate", "On Tea Growing", "On Family Peasant Farms", "On Horse Breeding", "On Non-Bank Credit Organizations", "On Cotton Growing", "On Compulsory Insurance", "On Licenses and Permits", "On Agricultural Cooperation", "On Science", "On Credit Bureaus", "On Cashless Settlements", "On Encumbrance of Movable Property", "On Development of Micro, Small and Medium Enterprises", and "On Combating the Laundering of Criminally Obtained Property and the Financing of Terrorism".
The key adjustments include:
- Regulating relations regarding the leasing of movable and immovable property within financial leasing activities under the law "On Financial Lease", repealing Chapter 39 of the Civil Code (which previously regulated leasing), and aligning terminology with the new law;
- Regulating the specifics of directing claims on financial lease objects under the law "On Insolvency and Bankruptcy" in a separate article;
- Amending the law "On Private International Law" to apply the law of the country where the lessor is established, resides, or mainly operates, in the absence of an agreement between the parties;
- Amending the law "On Credit Bureaus" to require financial lessors to submit credit history information to at least one active credit bureau;
- Amending the law "On State Registration and State Registry of Legal Entities" to provide information on founders and their shares in commercial entities to the Central Bank of Azerbaijan upon request for licensing, registration, and supervision purposes;
- Amending the law "On State Fees" to establish a state fee of 550 AZN for registering financial lessors in the official registry maintained by the Central Bank of Azerbaijan;
- Amending the law "On Licenses and Permits" to include the law "On Financial Lease" within the scope of laws regulating the licensing and permit system in financial markets.
These comprehensive legislative updates aim to modernize Azerbaijan's financial sector, improve regulatory oversight, and provide a more robust legal framework for leasing operations, which serves as an alternative financing tool for businesses in Azerbaijan.
