Legislative base on startups underway, says Rovshan Rustamov

"Legislation on startups will be developed next year. Currently, it is the subject of discussion," Azerbaijani Deputy Minister of Digital Development and Transport Rovshan Rustamov told Report.

"We intend to submit this legislation to public discussion by 2022, and the relevant agencies will be involved. For this reason, we are unable to provide detailed information on the legislative framework, which is currently under development," Rustamov said.

He added that more than ten agencies are now working on the legislation.

In the current legislation, the definition, characteristics, and criteria of a startup can be found in the Tax Code and the "Criteria for determining a startup" approved by the Cabinet of Ministers on January 29, 2021. Startup - an entrepreneurial activity based on an innovative initiative, carried out by persons, who meet the criteria set by the relevant authority and have obtained a "Startup" certificate by the body supporting the development of micro, small and medium enterprises.

Applicants for a Startup Certificate must:

- be a micro or small business entity;

- have the share of less than 49% in medium and (or) large business entities;

- be a resident taxpayer.

The Startup Certificate exempts the entrepreneur from profit and income tax on revenue from innovation activities for a period of 3 years.

The Azerbaijani government wants to improve the country's startup ecosystem and create the Absheron Valley, an alternative to the famous US Silicon Valley.