How does state resolve product quality problem?

State regulation of quality in the Azerbaijan Republic is realized through the standardization and certification of products.

The legal basis of standardization in Azerbaijan is the Law on Standardization dated 16 April 1996 (later in 2001, 2003 and 2004, additions and changes were made).

This law established rules which are important for all state agencies, enterprises and entrepreneurs (economic entities), public associations, and identified measures to protect consumer interests and the state through the development and introduction of normative papers on standardization.

Standardization is a work of rules, regulations and characteristics in order to ensure:

- Protection of consumer interests and the state in nomenclature and quality of products, services and processes that ensure their safety for human life and health, the environment;
- Improve product quality in accordance with the development of science and technology with the needs of the population and national economy;
- Compatibility and interchangeability of products;
- Promote the savings of human and material resources, improving economic indicators of production;

- Removal of technical barriers in production and trade, ensure product competitiveness in the global market and the effective participation of state in interstate and international division of labor;
- To ensure security of the national economy, taking into account the risk of natural and technological disasters and other emergencies;
- Promotion of defense and mobilization of readiness of the country.

Development of normative documents on standardization should be based on the mutual desire of all stakeholders, developing, manufacturing and consuming products, to reach an agreement, taking into account the views of each party to manage the variety of products, quality, efficiency, applicability, compatibility and interchangeability, safety for life , health and property and protect the environment

Standards:
- Should be required from the social, technical and economic point of view:

- Should not hinder international trade;

- Must not contradict requirements of international and regional standards;
- Must conform to the norms of legislation, as well as rules and enforcement functions of state control;

- Should have the best claim;

- Must update requirements;

- Must be suitable for application for certification;

- Must be clearly set out the text and be unambiguously understood;

- Must avoid the duplication of standards development at the identical objects of standardization at various levels of government

Documents in the field of standardization used in the territory of the Azerbaijan Republic: Azerbaijan Republic Law "On Standardization", six national standards that form the basis of the state standardization system of Azerbaijan Republic:

AZS 1.0-96, AZS 1.2-96, AZS 1.3-96,

AZS 1.4-96, AZS 1.5-96, AZS 1.6-96

The list of documents relating to the standardization includes national standards of the Republic of Azerbaijan, as well as international and regional standards and standards of foreign countries used in the established order on its territory

The structure, which is a part of the national standardization system -the State Committee on Standardization, Metrology and Patents of Azerbaijan Republic - carries out governmental regulation in the field of standardization. Other bodies of public administration have been working to standardize within their powers. For example, work on standardization in the field of organizing the Ministry of Emergency Situations.

Technical Committees (TC) on standardization is formed for the organization and implementation of the development, review, negotiate and prepare state standards of Azerbaijan Republic for the approval, other normative documents on standardization, as well as the work of international (regional) standardization. Technical committees on standardization of "Information and communication technologies" (TC 05), on "Tourism and Services of accommodation" (TC 06) have been set up and operate on the basis of the adjusted ministries.

The Azerbaijan Institute of Standards was established on January 1, 2007. The technical Committee on Standardization of food and agricultural products (TC 02), as well as the Technical Committee on Standardization of crude oil petrochemical products TC 03) are operating on the bases of the Institute.

Normative papers on standardization are divided into the following categories:

- Interstate standards - State standards

- State standards of the Republic of Azerbaijan - AZS

- Sectoral standards - SSAZ

- Specifications - TŞ AZ

- Standards - MS

- Standards of scientific, technical and engineering societies (unions, associations and other associations - ETMCS.

State standards of the Republic of Azerbaijan contains the mandatory and recommended requirements.
     
Currently the fund of standards contains 319 AZS, 690 TŞ AZ, 18911 Standards, 2012 State Standards (National Standards of Russia), 13,223 Turkish Standards (TS), 4816 International Standards (ISO), as well as a large number of guidance documents, regulations and recommendations etc.

In February 2009, the State Committee for Standardization, Metrology and Patents of Azerbaijan has approved three new standards for food products. These are AZS 328-2008, AZS 329-2008 and AZS 330-2008.

Since June 1, 2009 new standards came into force. Thus, the draft of national standards of Azerbaijan, prepared based on the second and third part of the International Standards on Information Security ISO/IEC 15408-2008 was registered by the State Committee for Standardization, Metrology and Patents of the country. The standard was registered on May 18. They are numbered AZS 356.2-2009 and AZS 356.3-2009, respectively. The national standard AZS 356.1-2009, developed on the basis of the first part of the international standard ISO / IEC 15408-2008 has been introduced since 20 April 2009.

The State Committee for Standardization, Metrology and Patents of Azerbaijan approved seven new standards in June 2009. These are AZS EN 197-2-2009, AZS EN 413-1-2009, AZS 354-2009, AZS 355-2009, AZS 361-2009, AZS 362-2009 and AZS 363-2009.

In accordance with the specific facility standards, composition and content of the requirements set by developing standards for the following types:

- Fundamental;

- For products, services;

- Processes;

- The methods of verification (test, measurement, analysis)

Order of the recognition and introduction of international (regional) and interstate standards on the territory of the Republic of Azerbaijan were approved by the Presidential Decree No. 26 dated November 22, 1998. Direct introduction of international standards is the recognition of the text in the Azerbaijani language as the standard of the Republic of Azerbaijan.

Currently 4 international standards (in banking) are applied in the territory of the republic. In addition, there are companies that have received international certificate ISO 9000 (Quality Management System).

State Committee on Standardization, Metrology and Patents of Azerbaijan Republic, as the national standardization agency, represents Azerbaijan in international and regional organizations, as well as in the following organizations involved in standardization:

- International Organization for Standardization (ISO);

- Interregional Association for Standardization (MAS);

- Interstate Council for Standardization, Metrology and Certification (ICSMC).

In 2003 Azerbaijan National Organization for Standardization (AZSTAND) joined the International Organization for Standardization (ISO), Interstate Council for Standardization, Metrology and Certification (EASC), Interregional Association for Standardization (MAS).

One of the conditions for Azerbaijan's entrance to the World Trade Organization (WTO) is to reform the existing system of standardization, the system of technical regulation, change the status of existing standards and make their application voluntary.

International experience shows that a necessary tool ensuring conformity of the product quality with the requirements of regulatory and technical documentation is certification.

Today certification is widely spread in the world, certification standards are recognized by all countries, they confirm the high quality of goods or services of the company.

In Azerbaijan there is a number of laws in this regard such Law on Rights of Consumers, which envisages protection of the rights of consumers via the realization of control over the observance of the regulations of trade and service in the spheres of trade. And the Law on Foodstuffs, accepted in February 2000, according to which the producer is obligated to pack and mark production, indicate designation and address of producer, date of production, period of validity and the data on the conditions of its storage. With regards to the direct questions of certification, there is a Regulation on certification of products (works, services) of the Cabinet of Ministers of Azerbaijan dated July 1, 1993.

This Regulation approved the list of products, which are subject to required certification. The voluntary certification of products is realized on the basis of the request of producer. Thus, the National Certification System AZS was established under the State Committee on Standardization, Metrology and Patent, as well as laboratories (centers), which conduct the tests of products, which correspond to legislative acts, were created.

At the same time, there are two kinds of standards - obligatory and voluntary. So, with regards to international standards - ISO, they all are voluntary. Voluntary certification of products is conducted on the basis of the request of manufacturer. Thus, there was established the National Certification System AZS under the State Committee for Standardization, Metrology and Patents, laboratories (centers), the relevant legislation, etc.

Product certification is the activity to confirm conformity with the requirements.

Up to now, no organization has been established in Azerbaijan, which takes responsibility for the non-conformity of the host products and presence of low-quality foreign products in the local markets. Currently the State Agency for Standardization, Metrology and Patent is the central organization forming and carrying out State policy with regards to standardization, metrology, certification. Monitoring in the trade network is being held by the organization established under the Ministry of Economic Development, and the Ministry of Health provides hygienic certificates on the quality. In Europe the procedures of certification are carried out by the private organizations. Once a year, the private companies give report on the number of the issued certificates before the State organization. The State only inspects the company to determine whether the certificate was issued accurately. 

In Azerbaijan the State is not prepared to stand away form the certification procedures because such private companies have not been established yet. Transferring the certification of the commodities is the requirement of the World Trade Organization (WTO) for Azerbaijan's entrance the organization. The State Agency for Standardization supports transferring the certification of the commodities to the private sector. However, the State Agency considers that currently it is impossible because there are not any companies in the country which contain relevant laboratories and specialists.   

Certification appeared due to the need of protecting the domestic market from the products which are unfit for use. The issue of security, protection of health and environment force the legislative power to establish the responsibility of supplier (producer, salesman) for the low-quality products on one hand, to establish the minimum requirements regarding characteristics of the products.

Thus, limitation is established for products, which falls under the action of legislative acts. In this case, it is indicated that the products falls into the legislatively regulated sphere. If the characteristics of products do not fall under the national laws, then these products can be freely moved to the corresponding market, and in this case, the products fall into the sphere not regulated by legislation.

For the products, which fall into the legislatively regulated sphere, the official confirmation is required on their conformity with all legislation requirements. One of the forms of this confirmation is the certification of products, conducted by the independent third side (the first - producer, second - user).

Correspondence to the European requirements on the standardization makes it possible for the producers to, without additional efforts, export their production not only to the European market. Thus, many countries give up the national requirements on the certification and accept the model close to the European standards, since majority of the countries require observance of the European standards. Even in America, European certification models function together with the national systems.

The products in the sphere not regulated by the legislation can, without difficulty, be moved inside the market, and in this case, the requirements on the establishment of conformity are not officially introduced on it. Nevertheless, in the contract situation, user can require supplier to provide the proof of conformity of products with definite requirements, for example conformity with concrete standards or a group of standards, conformity with specific requirements, made by user (including conformity with the contract conditions). In this case, the certification of the third side also can appear as the confirmation of fulfillment of conditions that are fixed in the conformity certificate with the concrete requirements established by the costumer.

The supplier in the sphere not regulated by the legislation can carry out the certification of his/her products with the independent third side, also, through the private venture. In this case, he/she inquires the confirmation of conformity of products with the characteristics, selected for their discretion. Supplier can inquire the establishment of conformity of his/her products with specific standards, determined by the technical parameters, content of passport or advertising material.

Since the procedure of certification is expensive, it can involve either reduction in the profit of supplier or increase in the cost of products, which in turn can decrease its competitive ability in the market. Therefore, the supplier must distinctly present the mechanism of extraction of benefit from the procedure of certification, for example, by conducting advertising campaign with the attraction of the conclusion of the independent third side.

The management of ISO determined eight scheme of certification by the third side:

1. Model testings of products.

2. Model testings of products with the further control on the basis of supervision of the plant models, bought in the open market.

3. Model testings of products with the further control on the basis of supervision of the plant models.

4. Model testings of products with the further control on the basis of supervision of the models, acquired in the open market and obtained from the plant.

5. Model testings of products and the estimation of plant quality management with further control on the basis of supervision of plant quality control and tests of models, obtained from the plant and open market.

6. Only estimation of plant quality management.

7. Checking of consignment of products.

8. 100% control.

According to the classical scheme, the test of the models of products is realized by the testing laboratories. The results of tests, designed in the form of protocol, are transferred to other organ for certification. In this case, the testing laboratory does not have the right to interpret to disclose the obtained data. Organ for certification compares the results of the tests with the requirements of legislation (if product falls on the sphere regulated by legislation) or other characteristics provided by the supplier, the norms, the documents. If product corresponds to the requirements indicated, the organ for certification issues a certificate of conformity to supplier.

With regards to the recognition of the Azerbaijani certificates in the foreign markets, certain works are being carried out in this regard. This year the State Agency intents to sign agreement of co-operation with Israel Standardization Institute with regards to standardization, certification and other related spheres, as well as agreement of co-operation with Lithuania regarding standardization, metrology and conformity, and memorandum of understanding with License Department of Hungary.   

Table 2. Classification of the most disseminated certification systems on the main classification criteria.