Azerbaijan is ready to by-stage liberalization of participation of foreign capital in the insurance market

Business Materials 11 August 2006 11:23 (UTC +04:00)

The Azerbaijani government still insists on by-stage removal of restrictions on foreign capital in the countrys insurance market.

The Finance Minister Samir Sharifov underlined, Our insurance make is mot developed well enough. If we open doors for foreign companies our market will face serous problems. It should be done by-stages and in this respect some changes to the Law on Insurance are being designed. In particular, it is planned to increase requirement set for the statutory capital of insurance companies, which will enable to prepare them to the process, Trend reports.

The privileged regime for the country should be maintained for a definite period, which would cover the period after the entrance to the World Trade Organization (WTO).

Removal of restrictions on 49%-participation of foreign insurance companies in joint insurance organizations in Azerbaijan is one of the terms put in the talks on entrance of Azerbaijan to the WTO. The term was put forward by the United States.

The exiting law on Insurance contains an item on possible participation of the foreign insurance capital in the correlation 49%/51%. Azerbaijani insurers do not regard it possible in the current stage, as the liberalization will lead to absorption of local companies by the world insurance giants. In this respect, the Law on Insurance in the new edition contained this correlation.