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Azerbaijan – New UBO Registration Requirements
Azerbaijan has implemented new Ultimate Beneficial Owner (UBO) registration requirements through Law no. 560-IIQ, effective 15th of May 2025. This new legislation aims to enhance transparency in corporate ownership structures while balancing confidentiality of beneficial ownership information.
Scope of Application
The requirements apply to:
- Legal Entities registered in Azerbaijan
- Branches of foreign companies
- Representative Offices operating within the country
Definition of UBO
Under Azerbaijan’s new Law no. 560-IIQ, a beneficial owner is defined as:
An individual or individuals who:
1. Directly or indirectly own shares that ultimately constitute 10% or more of the authorized capital of a legal entity, or
2. Hold voting rights that allow them to exercise significant influence over the decision-making of the legal entity, or
3. Can exercise significant influence on the legal entity’s decision-making through an agreement, despite the distribution of participation shares potentially excluding the existence of a significant participation share.
Required Information for Registration
Entities must submit the following details:
- Full name, date of birth, and identification number
- Citizenship and place of residence
- Direct or indirect ownership status
- Scope and basis of influence over the entity
- Politically Exposed Person ‘PEP’ status (including relatives)
- Details of intermediate entities in the ownership chain
Registration Deadlines
Deadline for registration is based on company size:
| Large Enterprises | 251 employees, annual revenue > AZN 30million | 31st December 2025 |
| Medium Enterprises | 51-250 employees, annual revenue AZN 3-30million | 30th June 2026 |
| Small Enterprises | 11-50 employees, annual revenue AZN 200,000-3million | 31st December 2026 |
| Micro Enterprises | 1-10 employees, annual revenue < AZN 200,000 | 31st December 2027 |
Additional Information:
- Investment Funds: Fund managers and entity managers are considered beneficial owners when ownership is widely dispersed
- Listed Companies: Management body satisfies UBO requirements for publicly listed companies with 10%+ ownership
- Change Reporting: Updates must be registered within 40 days
- Data Privacy: UBO information remains confidential and restricted from public access
The Risks of Non-Compliance
Failure to comply with UBO registration obligations including:
- Non-submission of required information to the register or
- Failure to report subsequent modifications to recorded information within stipulated deadlines,
Shall be subject to the following monetary penalties:
- For natural Persons acting in an official capacity: AZN 1,000 – 2,000 fine
- For legal entities: AZN 2,500 – 3,000 fine
How Mercator® by Citco Can Help
Need assistance? Mercator can help with UBO registration and internal UBO register preparation. Contact mercator@citco.com
