SCC OF AZERBAIJAN AND CIBC FORM A COORDINATION BOARD ON COOPERATION

 

Code currently used in Azerbaijan was approved in 1997. The new version of the Customs Code of the Republic of Azerbaijan based on the requirements of the international conventions has been drawn up with the financial backing up of the European House. The draft law currently undergoes editing and is due to be submitted to the Presidential Administration and further to Milli Majlis (the Parliament) for consideration within the next few months", Aydin Aliyev, the Chairman of the State Customs Committee of the Republic of Azerbaijan said (June 01) at the meeting with CIBC member-companies.

 

 

Aydin Aliyev informed the member-companies of the Caspian Integration Business Club (CIBC) about the activity of the State Customs Committee since its very formation and covered the follow-up outlooks.

According to Aydin Aliyev, CIBC is one of the largest organizations uniting businesspeople.

"One of the key objectives of the State Customs Committee is to speed up the trade turnover and implement the fiscal policy of the state", A. Aliyev said.

The State Customs Committee (SCC) of the Republic of Azerbaijan was established on January 30, 1992, though 3 customs stations (the Baku Sea Port, customs posts in Astara and Julfa) have operated since the FSU times. 

The Azerbaijan's customs service has been stepwise progressing since 1992 and now the number of customs officers in Azerbaijan exceeds 2,300 people. At the moment there are nearly 20 various customs departments formed in Azerbaijan that are subdivided on the principles of frontiers, territories and registration of goods of various nomenclature. There are SCC-run special departments to deal with registration of motor transport, oil and oil products, excise goods.

The core objectives the SCC faces now are fixed in the State Programme on Customs Authorities Development in Azerbaijan approved by President of Azerbaijan, Mr. Ilham Aliyev on February 1, 2007.

This year the SCC is due to provide collection and transfer of taxes and dues to the state budget of Azerbaijan in the amount of 770 million AZN (approximately $900 million). "For instance, in 1992 budget revenues from the foreign trade made only $900,000, whereas the state budget of Azerbaijan totaled $391 million", A. Aliyev told.

The SCC is implementing an active struggle against violators of customs norms and rules. The second regional training centre in the world was set up in 2003 with participation of Michel Danet, Secretary General World Customs Organization. The canine service was opened on the same year at the expense of the off-budget funds received from struggle against contraband and violations of the customs rules during two years.

 Under the terms of the agreement signed with the United Nations Development Programme (UNDP), the SCC has launched implementation of the fourth stage of this programme. All customs services in Azerbaijan are available on-line. Thus, today any SCC-run service immediately receives the information about motor transport or cargo crossing the frontier.

The SCC cooperates with the customs services of the neighbouring states as well as with the customs authorities of USA, China, South Korea and other countries that signed the range of interstate and intergovernmental agreements, bipartite memorandums and protocols, the SCC Head said. 

Since June 1992 the SCC of Azerbaijan has been the member of the World Customs Organization (WCO). Over this period the SCC of Azerbaijan has been represented in the WCO-run Fiscal Committee, twice in the Political Committee of WCO and since April 2007 in the WCO-run Audit Committee (the WCO-run supreme control authority that supervises over funds consumption and identifies the primary areas of financing customs authorities). For instance, out of the European countries only Azerbaijan and Belgium are represented in the WCO-run Audit Committee (totally 7 countries are represented in the Audit Committee).

According to A. Aliyev, the SCC of Azerbaijan constantly reveals problems in the customs procedures so as to eliminate them.

In response to the questions of the journalists A. Aliyev laid emphasis on the fact the SCC of Azerbaijan had been operating for 15 years, whereas the WCO was set up in 1952. He said one of the two subdivisions of the ICO established in first days of work was the Tariff Agency performing the tariff valuation. "This is one of the most important work for Azerbaijan and international customs agencies. Taking into account Azerbaijan's imports and duty-free goods articles, this year the SCC was assigned to transfer AZN 140 million in addition to the 2007 forecast in amount of AZN 630 million, during June-December 2007", said Aliyev. He refuted the opinion that SCC subdivisions underestimate the goods price during the valuation as it is not likely in view of toughened requirements for the SCC. He said according to experts review only 1% of all complaints today are related to customs agencies operation.

Of AZN 140 million to be additionally transferred to the budget, 104 million shall be the VAT incomes, said Aliyev. A certain part of collections is related to the road tax agreed upon with Iran and brought into effect since March 10, 2007. The expenses of vehicles transporting cargoes to Nakhchivan via Iran will be covered by government. The remaining part of requirements for the SCC for the current year will be covered through excise taxes for import of cars and alcoholic beverages. The alcoholic beverage excise tax has come in effect since April 1, 2007.

Aliyev said over 70,000 cars were imported to Azerbaijan last year. Taking into account the effective excise tax for cars, by the results of first 4 months of 2007 (24,000 cars imported versus 21,000 a year before) one may forecast over 60,000 cars to be imported throughout 2007. The total excise tax collection of 2007 is expected in amount of AZN 8-15 million.

SCC head said also the intensive work is performed on Azerbaijan's entering the World Trade Organization (WTO). In this respect, serious attention is paid to customs authorities.

Touching upon the proposals on liberalization of capital flow upon Azerbaijan's entering the WTO, First Deputy Chairman of SCC Safar Mehtiyev said the SCC is working to create a tariff bank. "In this aspect the higher duties will be set for the goods currently produced in Azerbaijan and also on those produced in the future", said Mehtiyev. The initial version of the tariff bank has already been submitted to the Azerbaijani government.

During the construction of the tariff bank, the SCC was guided by the principles of domestic market protection, government's fiscal policy and creation of conditions for domestic industry development.

Furthermore, the documents on methods of estimation and determination of manufacturer in compliance with WTO requirements have been submitted to the government.

Aliyev said over 4 months of 2007 the import statement in Azerbaijan's turnover increased by 20%. From the early 2007 the most imported goods were alcoholic beverages, electric appliances, cars, and raw stock for producing aluminum and sugar. While in 2007 the goods exempted from fees due to oil projects made 65-70%, this year their fraction dropped to 45%.

Rizvan Mustafayev, Chief of Internal Security with SCC, answered the questions regarding applications and complaints. He said the problems chiefly concern the illegal carriage of goods. In such cases these people are explained the norms of effecting Customs Code of the Republic.

"In the nearest future we are going to establish the joint Board of Customs and businesspeople that will bring together heads of CIBC and representatives of the Customs Committee. This Board will be solving problems arising between businesspeople and customs", said in his speech Telman Aliyev, President and CEO, CIBC.

Further the CIBC session was held behind closed door. CIBC member-companies discussed a number of issues related to customs work. In particular, they spoke of new Customs Code, protection of domestic market, implementation of e-declarations, creation of free customs storage terminals, operation of petroleum companies and related issues, problems with export of software, upgrading of customs checkpoints and so on.

Aydin Aliyev answered the numerous questions of CIBC member-companies. During the session, Chairman of the State Customs Committee (SCC) of Republic of Azerbaijan Aydin Aliyev was handed the CIBC Honorary Member Certificate.

The companies from Azerbaijan, Georgia, Kazakhstan, Turkey, Russia, Ukraine, Lithuania, Iran and other countries took part in CIBC session.