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Article Azerbaijan: First Competition Code Adopted and Promulgated

On January 23, 2024, President Ilham Aliyev of Azerbaijan promulgated the nation’s first competition code by signing a decree implementing Law No. 1051-VIQ. The new law, which was adopted by the Milli Majlis (National Assembly) of Azerbaijan on December 8, 2023, provided approval of the Competition Code of the Republic of Azerbaijan, which was first introduced almost 20 years ago.

The new competition code consists of 12 chapters and 84 articles. According to legal observers, the code introduces new concepts and definitions such as relevant market, unfair trade practices, low monopoly price, barriers to entry, and concentration of economic subjects. Moreover, it redefines some existing concepts, including dominant position in the market, unfair competition, and agreements restricting competition. Legal provisions concerning dumping and cartel transactions will also be changed. 

According to article 15.4 of the new code, a market position is considered dominant if a business’ market share is more than 50%, or is less than 50% but more than 35% and the business “has the ability to influence the relevant market.” The code provides other benchmarks of dominant position, depending on the competition, price changes, and other market conditions. (Competition Code art. 15.)

Under article 19 of the code, aggressive behavior toward customers, misleading and deceiving customers, discrediting a competitor business entity, imitation of a competitor’s entrepreneurial activity, and the illegal acquisition, use, or spreading of a trade secret would be recognized as unfair competition. Other actions that would also be considered unfair competition have been listed in article 25 of the Code.

The presidential decree under which the competition code was promulgated ordered the Cabinet of Ministers to draft subordinate legislation and define the authority of government bodies in charge of implementing antirust policies. The president instructed the Cabinet of Ministers to prepare a bill defining the liability for breaching the competition code within the next six months. Proposals on improving and ensuring the activities of the Antimonopoly and Consumer Market Control State Service under the Ministry of Economy and recommendations for resolution of other issues arising from the passage of the competition code are among the documents requested by the presidential decree.

Reportedly, the passage of this code is one of the requirements for Azerbaijan’s accession to the World Trade Organization.

The new competition code will enter into force on July 1, 2024. Current laws on antimonopoly activity, unfair competition, natural monopolies, and other normative legal acts will be repealed as their norms are combined  in the competition code. Legal commentators state that the new code broadens the scope of some previous regulations and appears to be more “concrete, detailed and practical.”

Prepared by Elgun Ganizade, Law Library Intern, under the supervision of Peter Roudik, Assistant Law Librarian for Legal Research.

March 26, 2024

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Chicago citation style:

Roudik, Peter. Azerbaijan: First Competition Code Adopted and Promulgated. 2024. Web Page. https://www.loc.gov/item/global-legal-monitor/2024-03-25/azerbaijan-first-competition-code-adopted-and-promulgated/.

APA citation style:

Roudik, P. (2024) Azerbaijan: First Competition Code Adopted and Promulgated. [Web Page] Retrieved from the Library of Congress, https://www.loc.gov/item/global-legal-monitor/2024-03-25/azerbaijan-first-competition-code-adopted-and-promulgated/.

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Roudik, Peter. Azerbaijan: First Competition Code Adopted and Promulgated. 2024. Web Page. Retrieved from the Library of Congress, <www.loc.gov/item/global-legal-monitor/2024-03-25/azerbaijan-first-competition-code-adopted-and-promulgated/>.