Investment Promotion Document in the Republic of Azerbaijan

2025-06-25

Author: Fidan Allahverdiyeva

The Investment Promotion Document is an official certificate issued by the government that provides certain advantages and incentives to both foreign and domestic investors. This document is granted to create favorable conditions for the implementation of investment projects and to encourage the inflow of foreign investments into the country.
The Investment Promotion Document is a special legal instrument applied in the Republic of Azerbaijan to support the development of entrepreneurship and to strengthen the national economy. It offers significant tax and customs exemptions to business entities, including foreign investors. This document serves both to protect the rights and interests of investors and to accelerate the country's economic growth.
Additionally, there are specific conditions and requirements for obtaining this document, and its issuance is carried out by designated state authorities. The Investment Promotion Document is a crucial legal and administrative instrument aimed at safeguarding the interests of stakeholders and ensuring the successful implementation of investment projects.
The document is issued by the Ministry of Economy of the Republic of Azerbaijan and is evaluated based on the value, purpose, geographical scope, and other parameters of the investment project.

What Is the Purpose of the Investment Promotion Document?

1. To attract domestic and foreign investments;
2. To develop the manufacturing and processing industries;
3. To create new job opportunities;
4. To accelerate the economic development of the regions.

Who Can Obtain the Investment Promotion Document?

Both legal entities and individual entrepreneurs operating without establishing a legal entity are eligible to obtain an Investment Promotion Document. The following conditions must be taken into account:

1. The applicant must be a legal entity registered in Azerbaijan or an individual engaged in entrepreneurial activity without forming a legal entity.
2. The applicant must meet the minimum investment threshold (typically between 100,000 and 500,000 AZN), which may vary depending on the sector and region.
3. The investment climate in Azerbaijan differs by region — more generous incentives are generally available in the regions compared to Baku, Sumgayit, and Ganja.
Conditions for Obtaining the Investment Promotion Document:
1. Project Eligibility: To obtain the document, the investment project must align with the country’s economic priorities and development strategy, and meet the defined goals and requirements.

2. Application and Documentation: The application must include a detailed project description, technical and economic indicators, legal and financial documents, and other required information.
3. Approval by Executive Authorities: A thorough evaluation of the project must be conducted, and approval from the relevant state authorities must be obtained.
4. Compliance with Legal Requirements: All legal and administrative requirements and procedures must be fully observed for the issuance of the document.
Incentives Provided by the Investment Promotion Document:
• VAT Exemption (7 years): No Value Added Tax is applied to imported machinery, equipment, and installations. This exemption reduces the cost of investment projects, allowing investors to operate under more favorable conditions.
• Income/Profit Tax Exemption (7 years): 50% of the income of individual entrepreneurs and 50% of the profit of legal entities are exempt from taxation. This incentive significantly lowers the tax burden and accelerates the return on investment.
• Property and Land Tax Exemption (7 years): Full exemption from property and land taxes. This reduces the financial obligations related to immovable property and land, protecting investors from additional financial burdens.
• Customs Duty Exemption (7 years): No customs duties are applied to imported machinery, technological equipment, and installations. This reduces overall project costs by exempting such equipment from import duties.

Areas Eligible for the Investment Promotion Document:

1. Industry and Tourism
2. Priority Sectors in the State’s Economic Policy
3. Information and Communication Technologies (ICT): Development of the digital economy and promotion of innovation
4. Agriculture and Agribusiness: Ensuring food security and advancing agricultural development
5. Infrastructure Projects: Development of roads, water supply, energy, and other infrastructure sectors
6. Tourism and Hospitality: Growth of the tourism sector and organization of international events
7. Green Economy and Environmental Protection: Projects related to renewable energy and environmental conservation
8. Free Economic Zones and Industrial Parks
9. Regions outside Baku, Sumgayit, Ganja, Absheron, and the liberated territories
Starting from 2024, the Investment Promotion Document is also granted to projects implemented in 13 strategic sectors:
1. Production projects based on local raw material resources
2. Energy production from renewable energy sources
3. Waste management and recycling
4. Desalination of seawater
5. Establishment of private industrial zones
6. Production projects at privatized non-oil industrial enterprises
7. “First in Azerbaijan” projects (Note: These refer to projects introducing a product, service, or technology that has never been produced or implemented in Azerbaijan before)
8. Operation and maintenance of aircraft
9. Repair of railway rolling stock and production of spare parts
10. Production of military-purpose products
11. Production of aluminum product
12. Public-private partnership (PPP) projects
13. Accommodation projects within the framework of the COP29 international event


Documents Required to Obtain the Investment Promotion Document:

1. A business plan (investment project proposal)
2. A document confirming that at least 10% of the initial investment has been made
3. A copy of the taxpayer registration certificate
These documents must be submitted to the Ministry of Economy of the Republic of Azerbaijan. Applications are reviewed within 5 business days.