The Constitution of Azerbaijan defines the Republic of Azerbaijan as a democratic, law-governed, secular, unitary republic with separation of powers. Azerbaijan has a multi-party system.
Civil society in Azerbaijan is relatively small, with an estimated 4,766 NGOs registered in the country. The NGO sector is primarily regulated by the Law on Non-Governmental Organizations (Law on NGOs), the Law on Grants, and several decisions of the Cabinet of Ministers.
Complex and burdensome registration procedures present a formidable barrier for those who wish to form and operate NGOs. It is difficult to register as either a domestic or international NGO in Azerbaijan. The Government of Azerbaijan has lost at least 32 cases before the European Court of Human Rights (ECtHR), which has found denials of registration to violate the freedom of association. In May 2021, the ECtHR found violations of the rights of 25 CSOs in Azerbaijan. NGOs also encounter difficulties in complying with informal requests to obtain a permit from the presidential administration and local authorities in order to carry out activities in the regions.
Since 2015, access to foreign funding for domestic NGOs in Azerbaijan has been seriously impeded, as the Government has introduced restrictive requirements for donor registration, registration of foreign grants, service contracts and donations. As a result, hundreds of NGOs have been left without substantial funding and thousands of skilled professionals have fled the sector. The funding restrictions reflect an often mistrustful and hostile government attitude toward NGOs, which are often referred to as “anti-government,” “foreign agents,” etc.
At present, the NGO sector is partially financed through public funding mechanisms, which provides small grants to NGOs. However, the amount of individual grants is rather limited and does not usually exceed 3000-5000 euro. On April 19, 2021, the President signed a Decree on Establishing a Public Legal Entity Agency for State Support to NGOs of the Republic of Azerbaijan, which replaced the NGO Support Council established in 2008.
In addition, on April 1, 2023, an amendment to the Tax Code came into force. It provides VAT exemption for three years for the presentation of media products and the performance of work and services directly related to media products by non-residents. Although the exemption does not apply to audiovisual media, it is expected to positively affect CSOs conducting media related activities and benefit them if they publish print materials, receive aid, and provide services related to their media activities.
Despite the existence of a some positive legislative, including for the participation of NGOs in the decision-making process (for instance, the Law on Public Participation), the role of civil society in the adoption of laws is limited in practice. Moreover, several restrictive laws have recently come into force. For example:
- On January 11, 2023, the new Law on Political Parties entered into force, which introduces new restrictions into the rules for establishing, registering, and terminating political parties, and it increases government control over party activities. It requires 200 citizens who have been permanently living in Azerbaijan for the past 20 years to found a political party; registration requires 10,000 people, and unregistered parties are not allowed. Opposition groups have criticized the law as anti-democratic and a restriction on the right to freedom of association.
- On January 31, 2023, the Law on Combating the Legalization of Property Obtained through Crime and the Financing of Terrorism (AML/CFT law) and the Law on Amendments to the Code of Administrative Offenses of the Republic of Azerbaijan (CAO amendment law) came into force. According to the AML/CFT law, CSOs must have rules and procedures aimed at minimizing risks when receiving and giving grants and donations, and they must submit detailed financial reports about grants and donations and their use to the supervisory body by April 1 each year. CSOs also must conduct their own annual risk assessment in order to comply with AML/CFT law requirements. All licenses, registrations, permits, and certificates of legal entities and individuals that do not comply with the law will be terminated or suspended. Under the CAO law, article 598.8 of the CAO was updated to include penalties for CSOs for not having rules and procedures aimed at minimizing AML/CFT risks. CSOs face fines of 10,000 – 20,000 manats (approx. 5,900 – 11,800 USD), and their officials face fines of 2,000 – 4,000 manats (approx. 1,200 – 2,400 USD) if they violate the requirements of article 598.8.
- Lastly, in April 2023, changes to the CAO Amendment Law included articles 381 and 388. The new version of article 381 broadened the scope of responsibilities of CSOs conducting media-related activities and set harsher and broader penalties for violations. In general, the penalties range from 200 – 10,000 manats (approx. 115 – 5,900 USD), which can be burdensome for CSOs conducting media related activities given their limited human and financial resources. Article 388 also provides penalties ranging between 200 – 3,000 manats (approx. 115 – 1,800 USD) for journalists and editors who disseminate information when it is prohibited by law or who disclose the source of information when it is not permitted by law.