Azerbaijan, Baku / Trend corr I. Khalilova / The Azerbaijani Finance Ministry has opposed the opening of direct branches of foreign insurance companies in Azerbaijan which would be operating in compliance with the legislation of the country, the head of the Insurance Control Department at the Finance Ministry, Namig Khalilov, reported on 4 June.
"We do not agree on this issue. The transition period for full liberalization of the insurance market in the country would still be under discussion," Khalilov said. However, according to Khalilov, share of foreign capital in a company will not be restricted. Restrictions will involve the total share of all the insurance companies operating in Azerbaijan.
Khalilov considers the step to be more liberal. However, the exact limit has not been defined as yet. The limit for foreign shares will exceed the previous limit. "The move will be made not only due to the requirements of the World Trade Organization. Necessity in providing the Azerbaijani population with access to insurance products corresponding to standards of developed markets is obvious.
Removed from the Law on Insurance is the item which specified the possibility of companies with a ratio of 49% to 51% participating in foreign insurance capital. This has therefore impeded leading insurance companies into the Azerbaijani market.
Twenty-nine insurance companies are operating in Azerbaijan, with nine of them having a foreign share.