LOGISTICS OF EXPORTING TO EURASIA SERIES

 

Product Certification Process in Azerbaijan

 

By Bakhtiyar I. Mamedov, BISNIS Azerbaijan                                   April 2005

 

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INTERNATIONAL COPYRIGHT U.S. DEPARTMENT OF COMMERCE, 2005. ALL RIGHTS RESERVED OUTSIDE OF THE UNITED STATES

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***NOTE: This report should be used for general reference purpose only.  As certification-related legislation and regulations are constantly changing, it is advised that exporters consult with certification agencies from the country of importation to obtain accurate and current information that would pertain to their specific transaction***

 

 

I.          OVERVIEW OF CERTIFICATION AND CONFORMITY ASSESSMENT SYSTEM

 

With considerable international assistance, the government adopted a comprehensive State Program on Poverty Reduction and Economic Development (SPPRED) for 2003-2005 and established a secretariat to oversee the program.  The SPPRED identifies priority public investment projects and provides a framework for donor assistance and government expenditure to promote economic development in the non-energy sector. 

 

Following meetings between the president and the foreign and domestic business communities in Spring 2002, the government issued a series of pro-reform decrees in August-October 2002 to address business climate concerns.  The decrees reduced the number of activities subject to certification and licensing, streamlining the licensing procedure. The government created an SME Entrepreneur's Fund, improved tax administration, and restricted harassment of businesses by government authorities.  An Entrepreneurs' Council, consisting of domestic and foreign companies and reporting to the president, first convened in July 2003.  As a result of these and other reforms, there have been improvements in the business and investment climate.

 

There are several companies involved in international inspection, expedition and certification in the Azeri market. The local market realizes that an internationally recognized certificate from a multi-accredited certification body certifies it as a first-class endorsement of their management system, wherever they trade.

 

Moody International Certification has established its business in Baku, and has distinctively certified BP Exploration's environmental system to ISO 14001 in December 2000.  The approach of continuous assessment during implementation has proven beneficial to both the client and the certifying body.

 

1.         Management systems certification includes:

 

 

The certification that Bureau Veritas delivers in Baku covers both voluntary and statutory procedures and is based upon national or international standards, generic or sector schemes, or tailor-made development.

 

2.         Regulatory Agencies and their functions

 

State Standardization, Metrology and Patenting Agency

Address: 124 Mardanov Gardashlari

Baku, Azerbaijan

Tel: (994 12) 4498490, 4405154

Fax: (994 12) 4405224

Contact: Ms. Khalida Masimova, General Director

 

 

According to the protocol department of the Cabinet of Ministers, the State Agency of Standardization and Patenting is responsible for certification.  This agency is under the Cabinet of Ministers and headed by Ms. Khalida Masimova.

 

3.         Current Legislation

 

September 2002 Presidential decree, "On Activities and Commodities Requiring Special Permission, Certification (Licenses)," reduced the number of activities subject to certification and licensing from 270 to 30, with the term of all certificates and licenses being increased to five years.  While this step has been welcomed by the business community as of August 2003, it remains unclear as to what practical, day-to-day effect this decree will have on business.  

 

4.         Mandatory Certification vs. Voluntary Declaration of Conformity

 

Some industries do not require licenses.  The Azeri government has signed a number of Production Sharing Agreements (PSAs) with consortia comprised of the oil majors.  The first PSA was inked with the Azerbaijan International Operating Company (AIOC) in 1994 to develop the offshore Azeri - Chirag - Guneshli (ACG) field.  Since then, the Azerbaijan parliament has ratified a total of 22 PSAs.  These PSAs provide a solid foundation for foreign investment in oil and gas-related sectors of the economy.

 

 

II.        CERTIFICATION PROCESS BASED ON COMMODITY TYPE

 

The following is a non-exhaustive list of activities subject to certification/licensing (as of Fall 2004) based on the authority responsible for issuing the certification/license:

 

Ministry of Fuel and Energy

 

Ministry of Health

 

State Committee for Construction and Architecture

 

Chamber of Auditors

 

City and region executive organs (with the exception of city districts)

 

Ministry of Telecommunications and Information Technologies

 

Ministry of Ecology and Natural Resources

 

Ministry of Economic Development

 

Ministry of Education

 

Ministry of Finance

·     Production of controlled accounting forms

 

Ministry of Internal Affairs

 

Ministry of Labor and Social Protection of People

 

Ministry of National Security

 

Ministry of Transportation

·     Transportation of passengers and goods by sea

·     Transportation of passengers and goods by air

 

Ministry of Youth, Sports and Tourism

 

National Bank of Azerbaijan

 

State Committee for Land and Cartography

 

State Committee for Securities under the President

 

Nakhchivan Autonomous Republic

 

2.         Certificate Of Conformity

 

While importing food products to Azerbaijan, the importer has to work with all three agencies.  StandCom check points will soon be established at customs control posts.  Currently, StandCom is working out its charter and regulations with assistance of the EU commission.

 

More and more companies, and from many different sectors in Azerbaijan, are seeking conformity assessment through several service providers.  Their objective is to enhance the value of their activities, projects, products and services.

 

Conformity assessment is one of the four core activities of Bureau Veritas represented in Azerbaijan, along with consulting, training and certification.  Bureau Veritas assesses the conformity of all kinds of products, equipment, and services to local or international standards and regulations.

 

The advantages of conformity assessment for companies are varied and significant.
Conformity assessment of some companies in Azerbaijan can cover quality, health & safety, environmental and social accountability issues, and is generally based on reference documents which can be any of the following:

 

These companies also provide auditing/assessment, testing/measurement, inspection, and rating services.  They also assist companies with recommendations in order to comply with the requirements.

 

Regulating agency

 

 

List of required documents

 

·        Quarantine Inspection Resolution-by Quarantine Inspection

 

The following documents should be appended to the Application:

 

The Ministry of Telecommunications and Information Technologies Ministry  Certificate

 

In the telecommunications sector, the Ministry of Communications has retained a 51 percent share in most enterprises.  This fact, as well as regulatory interference from the Ministry, has hindered investments in broadband and wi-fi technology.  Internet access is adequate in Baku, but many outlying regions of the country, where landline telephones need modernization, still do not have access to the internet.  E-commerce does not yet exist in any meaningful way in Azerbaijan.

 

Regulating agency

 

The Law on Telecommunications and Information Technologies is the main legislative act regulating the industry.  Telecommunications services must be certified/ licensed.  The Ministry is required to keep а register of telecommunication certificates and licenses that have been issued, registered, suspended, or renewed. 

 

List of required documents

 

Foreign companies may apply for certification directly; representatives or physical persons applying on behalf of company are not required.  The Ministry of Communications and Information Technologies requires the completion of two forms, the first for technical compliance, the second for safety and ecological indication.

 

Affected groups of commodities

 

Under the Telecommunications and Information Technologies Law, the state has exclusive ownership of the spectrum of radio frequencies.  The State Radio Frequencies Commission is authorized to issue radio frequency use permits to telecommunications businesses.  This Commission also prescribes the rules and procedures for obtaining such permits and for operating at various frequencies.

 

III. WHAT TO EXPECT DURING CERTIFICATION PROCESS

 

The Certification and licensing process presents obstacles for some firms in Azerbaijan.  However, a September 2002 Presidential decree, "Activities and Commodities Requiring Special Permission, Certification (Licenses)" reduced the number of activities subject to licensing from 270 to 30 with the term of all licenses increased to five years.  While this step has been welcomed by the business community, as of August 2003, it remains unclear as to what practical, day-to-day effect this decree will have on business.  

 

President Aliyev issued a series of decrees to remove obstacles to doing business in this country, resulting in some consequent improvements in tax administration and the creation of an Entrepreneur's Council reporting to President Aliyev.  Despite Azerbaijan's macroeconomic successes and initial efforts to take on structural economic reform, this country remains a difficult place to do business given arbitrary customs administration, a weak court system, monopolistic regulation of the market, and corruption. 

 

Available certification schemas

 

Certification companies in Azerbaijan have issued ISO certificates world-wide covering a wide range of industry and service sectors and their clients range from multi-national companies to small, family owned organizations.


Lead time

 

The State Standardization Committee registers the application upon receipt.  The period of consideration of an application cannot exceed three months from the day of its registration.  The State Standardization Committee may require additional information from an applicant, including the findings of an expert institution about the organizational and technical preparedness of an enterprise to carry out the licensed activity, before granting a license.

 

Associated costs

 

The State Standardization Committee, Vet Committee and Quarantine Inspection Resolution fix rates for each type of license according to price.  Rates are established as multiples of the minimum wage rate per month, to be periodically raised by the Azerbaijan law, and range now from $250.00 to $800.00.

 

Expenses for examination of documents, presented with a license application, are not included in the cost of issuing the certification or license.  The applicant must pay separate fee for the examination of documents.  Payment should be made to appropriate examination organizations.  The rate of charge for the examination is negotiable.

 

In case of refusal to issue the license, deposited fees are not reimbursed to a declaring party.  The same fee is charged for license extension and re-registration (in case of changing the conditions of license issuing) as for the license's issuing.

 

Companies that have been licensed will be subject to periodic surveillance by the State Standardization Committee’s regional bodies.  These bodies are responsible for ensuring that licensees observe all conditions during the period of the license.

In addition to the State Standardization Committee, the Ministry of Economic Development has established regional branches throughout the country.  These bodies form a united system to maintain state control and supervision in Azerbaijan.

 

IV.       ADDITIONAL INFORMATION

 

1.         Packaging, marking, labeling requirements

 

The Law requires labeling on food products imported to Azerbaijan.  The Label should have the description of product's composition, components and energy balance in Azeri language.

 

According to the protocol department of the Cabinet of Ministers, the State Agency on Standardization and Patenting is responsible for labeling.  This agency is under the supervision of the Cabinet of Ministers and headed by Ms. Khalida Masimova at tel: (994 12) 4403553.

 

2.         Certification/testing service providers

 

Company: SGS Azeri Ltd.

Address: 3001 Tbilisi Avenue

Baku AZ1102, Azerbaijan

Tel: (994 12) 4303380, 4303381, 4303381

Fax: (994 12) 4303371

Web: www.sgs.com/contact_us?clickedcountry=10

Contact: Teymur Abbasov, General Manager
 

 
 

 

 

 

 

 

 




 

Company: Bureau Veritas Azeri L.C.C.

Address: 191 Bashir Safaroglu, Apt 42/44

Baku, Azerbaijan

Tel: (994 12) 4973526, 4973529

Fax: (994 12) 4973526, 4973529, 4930756

E-mail: Arbil.Boz@bureauveritas.com.az

Web: www.bureauveritas.com  

Contact: Arbil Boz, Country Representative

 

 
 

 

 

 

 

 

 

 

 

 

Company: Moody International LTD.
22 Boyuk Gala / Icheri Sheher (Inner City)
Baku, Azerbaijan
Tel: (994 12) 4971880; (994 50) 221 5616
Fax: (994 12) 4971887
Certification Division E-mail: certification@moodyint.az

Web: www.moodyint.az

Contact: John Norton, General Manager   

 
 

 
 

 

 

 

 

 

 

 

 

 

 


CERTIFICATION ENQUIRY / APPLICATION

 

 

Please provide the following information to enable Moody International to advise you of the certification cost for your organization.

 

1)  Company  name:

 

Address:

 

 

 

Contact: 

 

Position:

 

Tel No.:

 

Fax No.:

 

E-mail

 

 

2) Standard to be Certificated:-  

 

ISO 9001 ¨    ISO14000 ¨    OHSAS 18001 ¨   HACCP ¨    QS 9000 ¨       Other __________

 

 

3) Accreditation Mark Sought (if known):

 

UKAS (UK)     ¨      TGA (Germany)  ¨     SINCERT (Italy)     ¨     RAB (USA)         ¨

 

RvA (Holland) ¨   COFRAC (France) ¨     RENAR (Romania) ¨     PNAC (Pakistan) ¨

 

DSM (Malaysia)       ¨Other _______

 

 

4)  Activities for which certification is required:

 

 

 

 

 

Description of products and/or services :

 

 

 

 

 

 

5) Sites and Locations

 

                        Name/location of site                            Number of employees within                                                                                                      scope of required certification

 

Site 1(Head office) :        _________________                          _____

 

Site 2 :   _____________________________                          _____

 

Site 3 :   _____________________________                          _____

 

            (Please use additional pages if more than 3 sites)

 

Is there a shift system in operation?           YES/NO

 

If yes, how many shifts cover the same activity? _______

 

 

 

6)         Please give approximate dates when you will be ready for :-

 

(a) your Quality Manual/documents to be reviewed:  ____ / ____ (Month/Year)

 

            (b) an on site audit of your system to take place:        ____ / ____ (Month/Year)

                                                           

                                               

7)         Audit Language?  (If not English):

 

            Verbal:                                                      Written: 

           

 

8).        Additional Information

 

            Have you used a consultant to help you prepare for certification?     YES/NO

 

            If YES please give the consultants name or organization:

 

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FOR ADDITIONAL INFORMATION, PLEASE CONTACT:

 

Mr. Bakhtiyar Mamedov

BISNIS Representative, Baku

Embassy of the United States of America

83, Azadliq Avenue

Baku 370007, Azerbaijan

Phone: 994124980335

FAX: 994124986117

Email: mamedovb@state.gov