Inward processing is a special customs procedure that allows certain goods to be brought into the customs territory of the Republic of Azerbaijan without the payment of customs duties and taxes, including VAT, for the purpose of processing and subsequent export.
Processing operations refer to the preparation, processing and reprocessing of goods, including installation, assembly, and adaptation to other goods; repair, including restoration and maintenance of goods; and the complete or partial use of certain goods that serve or facilitate the processing operation.
Yes, regardless of the number of stages in the production process, this procedure can be used.
The procedure is regulated by the “Rules on Placement of Goods under the Inward Processing Special Customs Procedure” approved by the Decision of the Cabinet of Ministers dated January 14, 2014.
According to the amendments made to the rules on April 10, 2023, the holder of the procedure may import raw materials or materials from any seller based on a purchase agreement and process them within the timeframe specified in the legislation for export to any buyer in any country. Therefore, it is not necessary to conclude a supply contract.
One of the main requirements for placing goods under the inward processing special customs procedure is the identification of goods. Identification involves the use of methods such as sealing, numbering, letter marking, labeling, applying identification marks, seals and stamps, taking samples and specimens, description of goods and means of transport, drawing of diagrams, scaled images, photographs, illustrations, accompanying and other documents, and other means of identification.
Equivalent goods are domestic goods that are of the same quality, technical characteristics, and classified under the same code in the foreign economic activity commodity nomenclature as the foreign goods placed under the inward processing special customs procedure and processed in their place.
Yes, it is possible. In this case, the relevant declaration must indicate which part is intended for export and which part is intended for import into the domestic market.
No, goods produced under this procedure must be exported under a relevant sales contract.
Before granting permission for placing goods under the inward processing special customs procedure, customs authorities may require the provision of security in accordance with Article 252 of the Customs Code (Article 252: When customs authorities are not confident that the customs debt will be paid within the prescribed period, they may require security even in optional cases).
The yield rate is the quantity or percentage of products obtained as a result of processing goods placed under the special customs procedure for processing. According to the “Rules for Determining the Yield Rate or Average Yield Rate of Operations Performed under the Special Customs Procedure for Processing,” when determining the yield rate, the quantity of production waste and production losses must be calculated. The method of determining the yield rate must be indicated in the application. The yield rate is determined based on the actual conditions under which the processing operations are carried out or are to be carried out.
The maximum duration of the procedure is 2 years. Upon a justified request, the customs authority may extend the completion period of the procedure by up to 1 year.
According to the “Rules on Accounting for Operations by Permit Holders, Procedure Holders, and Persons Engaged in Storage, Production, Processing, and Trading of Goods in a Free Zone,” the person who places goods under the inward processing special customs procedure must maintain accounting records of the processing operations.
The accounting of operations is conducted either in written (paper) or electronic form.
