"Criteria for the breakdown of micro, small, medium and large businesses" was approved by the Resolution no. 556 of the Cabinet of Ministers of the Republic of Azerbaijan dated December 21, 2018.
The criteria for classifying economic entities as micro, small, medium and large businesses are determined based on the list of employees and their annual income (given in the Table).
Criteria for the breakdown of micro, small, medium and large businesses
|
Categories by size of business entities |
Average number of employees (persons) |
Annual income (ai) (thsd manats) |
|
Micro business |
1 - 10 |
ai ≤ 200 |
|
Small business |
11 - 50 |
200 < ai ≤ 3 000 |
|
Medium business |
51 - 250 |
3 000 < ai ≤ 30 000 |
|
Large business |
251 and above |
30 000 < ai |
Subject to the above criteria, business entities with a staff of 10 persons or less or with an annual income of 200,000 manats or less are classified as micro-entrepreneurship entities, business entities with a staff of 11 to 50 persons or with an annual income of 200,000 to 3,000 thsd manats as small enterprises, business entities with a staff of 51 to 250 persons or with an annual income of 3,000 thsd to 30,000 thsd manats as medium-sized businesses, and those with a staff of 251 persons or more or with an annual income of more than 30,000 thsd manats are considered large businesses.
Annual income includes the cost of goods, works and services provided during the reporting year, as well as non-operating income.
According to the criteria for defining entrepreneurs as micro, small, medium or large entrepreneurs, "average number of employees" and "annual income", whichever is higher, is taken as a basis.
When determining newly created business entities as micro, small, medium or large entrepreneurs, the number of employees determined within 1 (one) year from the date of their state registration or tax registration is taken as the basis.
Classification of entrepreneurs as micro, small, medium or large entrepreneurs is determined on the basis of information on these business entities transmitted by the Ministry of Taxes of the Republic of Azerbaijan and the Ministry of Labor and Social Protection of the Population of the Republic of Azerbaijan to the State Statistics Committee of the Republic of Azerbaijan and remains unchanged during the year.
In accordance with Part 3 of Article 4-1 of the Law of the Republic of Azerbaijan “On Entrepreneurial Activity”, state support and benefits provided to micro, small and medium-sized businesses within the framework of measures to regulate entrepreneurship shall be carried out on the basis of the criteria for the breakdown of micro, small, medium and large businesses. The new criteria identified as a result of studying international experience makes it possible to significantly expand the scope of these supports and benefits.
