Reference on legislation requirements for property purchase

Property purchase rights of foreigners and stateless persons are defined in accordance with current legislation of the Republic of Azerbaijan as following:

In accordance with the land code of the Republic of Azerbaijan foreigners, stateless persons, foreign legal entities, international communities and organizations as well as foreign states may be parties to land relations by observing restrictions provided with legislation.(Land Code of the Republic of Azerbaijan (LC) article 3.2, 3.3)

Simultaneously in accordance with articles 245 of the Civil Code of the Republic of Azerbaijan and 4.4 of the Land Code of the Republic of Azerbaijan estate is sold with immovable property in civil turnover. Although in accordance with Land Code if buildings, plants or enterprises are sold to foreigners, stateless persons, foreign legal entities, international communities and organizations as well as foreign states the land under these immovable properties are leased by them.(LC a. 88.4) In this case the legal status of estate and property on it is defined separately in accordance with object of deal. (With regard to land and immovable property excluding land)

Thus, in accordance with article 48 of the Land Code foreigners and others may purchase the land only by rent right in the Republic of Azerbaijan. (LC, a. 48.3, 86.4)

Contrariwise, in accordance with article 60.2 of the Land Code foreigner, stateless person or foreign legal entity being owner of privatized enterprise may rent the relevant estate without right to sell it.

Also in accordance with current legislation property right on estates transferred to foreign legal and individual persons by heir, gift and mortgage deals is evicted during one year in accordance with the legislation of the Republic of Azerbaijan. If foreign legal and individual persons do not evict their property right on estate in accordance with legislation relevant executive authority or municipality purchases estate with regard to regulation of this Code. (LC a. 49.4)

Purchase of property rights on possessions excluding lands in the Republic of Azerbaijan by foreigners and others is defined by provisions of Land Code mentioned above, as well as by the article 17 of the Law of the Republic of Azerbaijan “On the legal status of foreigners and stateless persons”, Apartment Code of the Republic of Azerbaijan and other normative legal acts.

On the other hand foreign investors may take part in privatization of state property as buyers in accordance with rules defined by legislation and in compliance with Law of the Republic of Azerbaijan “On Privatization of State Property” and “II State Program on Privatization of State Property in Republic of Azerbaijan” adopted by decree number 383 of the President of the Republic of Azerbaijan dated 10 august 2000. (Law on Privatization of State Property, a. 9.4)

In accordance with article 139.1 of the Civil Code property rights and other rights on immovable property, limitation, formation, eviction and finish of that kind of rights must be registered by state. Property right, right of use, mortgage, servitudes and other rights on immovable property must be registered in accordance with cases defined in Civil Code and legislation.

In accordance with article 139.3 of the Civil Code the state registration of immovable property is provided by relevant executive authority (State Service for Registration of Real Estate under the State Committee on Property Issues of the Republic of Azerbaijan) in the state registry of immovable property.

Bases for state registry of limitation, formation, eviction and finish of rights on immovable property are defined by article 139.1 of Civil Code.

Simultaneously agreements on disposal of state registry objects of immovable property in the Republic of Azerbaijan are approved by notaries in accordance with current legislation. During assertion notary must verify the order right of the ordering party and the conformity of agreement with law. (Civil Code, a. 144.1) After notarial certification notary provides two copies of agreement to applier or on the request of the latter sends right purchaser’s application form about registration of immovable property in state registry in accordance with legislation, agreement, documents reflecting other bases provided by law for state registration or rights, plan and measure of plot of land, technical passport of buildings, plants, and other immovable properties (their components) situated the plot of land and including receipt about payment of state duties to the relevant executive authority. (CC a. 144.3)

Agreements on immovable property not registered by state registry of real estate are not allowed for notarial certification and that kind of property agreements are invalid. (CC a. 146.2 and 146.3)

In accordance with the legislation of the Republic of Azerbaijan purchase of property right on real estate is provided to buyer as soon as it is registered by state registry of real estate.