Innovations in registration of commercial legal entities were discussed

On September 20, 2024, an online meeting on innovations towards state registration of commercial legal entities for start-ups, micro and small business entities was held by the State Tax Service (STS) jointly with the Small and Medium Enterprise Development Agency (KOBIA) under the Ministry of Economy. The meeting was attended by the representatives of STS and KOBIA, entrepreneurs, heads of local companies.

Head of Division within Taxpayers' Registration and Accounting Main Department Leyla Huseyn-zadeh submitted presentation on "State registration of commercial legal entities, and related reforms". L. Huseyn-zadeh reported on the implemented activities and upcoming tasks on the Road Map for 2022-2023 regarding the implementation of improvements in the relevant fields related to the "Business Entry" indicator of the World Bank Group's "Business Enabling Environment" project, where 30 measures on 2 sub-indicators and 6 components have been implemented.

The participants were also provided with a detailed explanation on implemented activities towards improving the legislation. It was accented that by the initiative of the  "Business Entry" working group within Commission on Business Environment and International Rankings of the Republic of Azerbaijan, laws on amending the Law "On State Registration and State Register of Legal Entities" and the Codes of Labor, Civil and Administrative Offenses were adopted and approved by the head of state on July 8, 2024. According to the amended legislation, there provided the equal electronic state registration procedures of local and foreign-invested LLCs. This innovation has simplified the process of starting a business, when provided the electronic registration service fully available for foreign entities in the country. Within reforms carried out in the field of "business entry", "SIMA" (face recognition) digital signature was applied during the online registration of a commercial legal entity, as well as  measures towards identification of sanctioned persons for the registration process and restricting access of the head of a commercial legal entity to use the e-cabinet upon the head's term expired. Moreover, once a quarter, the service of sending a notification on the necessity of applications for the registration of information changes to the electronic cabinet of commercial entities has been activated. At the same time, when the types of activities that require a license or permit are selected, after the completion of the process of electronic state registration of commercial legal entities, the creation of a link to the "Licenses and Permits" portal is provided.

It was noted at the meeting that reforms are being continued towards implementation of improvements on relevant areas related to the "Business entry" indicator, which was expanding the scope of coordinating the databases of state agencies involved in the pre-registration and post-registration processes. The creation of the technical possibility of keeping the register of the beneficial owner and the possibility of proactively registering the subsequent change in the existing information on commercial legal entities (founder change) seem also be an actual issue.

The meeting continued in the conditions of mutual discussions, and participants’ questions were answered in the course of meeting.

It should be noted that the activity of the "Business Entry" working group is managed by the State Tax Service under the Ministry of Economy.

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