Registration of individuals and legal entities involves the concepts of an individual and a legal entity.
A legal entity is a company that conducts economic activities, has rights and obligations, and is liable for its obligations with the company’s property and authorized capital. A legal entity is required to keep accounting records and submit reports to a service specified by law. Legal entities can be both commercial and non-profit organizations.
An individual is a person who carries out activities and is liable for his obligations with all his property. An individual is not required to keep accounting records.
- Establishment of a legal entity with local investments, if the founder is an individual;
- Establishment of a legal entity with local investments, if the founder is a legal entity;
- Establishment of a legal entity with foreign investment, if the founder is a legal entity;
- Establishment of a legal entity with foreign investment, if the founder is an individual;
- Establishment of a representative office of a legal entity;
- Establishment of a branch of a legal entity;
- Registration of an individual (private entrepreneur).
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According to the Civil Code of the Azerbaijan Republic, the following organizational and legal forms of legal entities exist in Azerbaijan: Commercial, non-commercial and public
Commercial legal entities
Limited Liability Company (LLC): A limited liability company is a company established by one or more persons (individuals and (or) legal entities), the authorized capital of which is divided into shares of sizes determined by the charter.
Open Joint Stock Company (OJSC): A joint stock company, the participants of which can alienate their shares without the consent of other shareholders, is recognized as an open joint stock company.
Closed Joint Stock Company (CJSC): A joint stock company, the shares of which are distributed only among its founders or other predetermined circle of persons, is recognized as a closed joint stock company.
Subsidiary Business Company: A business company is recognized as a subsidiary if another (main) business company or partnership, due to a predominant participation in its authorized capital or in accordance with an agreement concluded between them, has the opportunity to determine the decisions made by such company.
Dependent Business Company: A business company is recognized as dependent if another (predominant, participating) partnership or company has more than twenty percent of the authorized capital of a limited liability company or twenty percent of the voting shares of a joint-stock company.
Full partnership: A full partnership is a partnership whose participants (general partners), in accordance with the charter, engage in entrepreneurial activities on behalf of the partnership and are liable for its obligations with the property belonging to them.
Limited partnership: A limited partnership is a partnership in which, along with the participants who carry out entrepreneurial activities on behalf of the partnership and are liable for the obligations of the partnership with their property (general partners), there are one or more participants – investors (limited partners) who bear the risk of losses associated with activities of the partnership, within the limits of the amounts of contributions made by them and do not take part in the entrepreneurial activities of the partnership.
Non-profit legal entities include:
Public associations: Property transferred to a public association by its founders (participants) is the property of the association.
Foundations: A foundation is a non-membership organization established by individuals and (or) legal entities on the basis of voluntary property contributions, pursuing social, charitable, cultural, educational or other socially beneficial goals.
Public legal entity: A public legal entity is an organization that is not a state or municipal body, engaged in activities of national and (or) public importance, created on behalf of the state and municipality.
A public legal entity is created on behalf of the state by a body (institution) determined by the relevant executive authority, and on behalf of the municipality by the relevant municipal authorities.
Registration of an LLC is determined by Art. 87 of the Civil Code of the Azerbaijan Republic. This term will no longer mean the registration of any company, like the terms we discussed above. LLC registration – this term is used exclusively in the meaning: registration of a commercial organization in the organizational and legal form of LLC – Limited Liability Company. A limited liability company is a company founded by one or more persons, the authorized capital of which is divided into shares of sizes determined by the founders; at the same time, the participants of the company are not liable for its obligations, and bear the risk of losses, within the limits of the value of the contributions they made. Those. The expression registration of an LLC determines not only the process of creating a certain company, but also its organizational and legal form in the form of an LLC.
To register a limited liability company, you must provide the following information:
- 3 options for company name;
- Main and, if any, additional type(s) of activity;
- A scanned copy of the passport of the founder(s) and director;
- Residence address of the founder and director;
- Email address of the registered company/director;
- Director’s local phone number.
Registration of CJSC as well as registration of LLC is determined in the Civil Code of the Republic of Azerbaijan (Article 100). The term registration of CJSC also includes an indication of the organizational and legal form in the form of CJSC – Closed Joint Stock Company. The differences between CJSC and LLC are that registration of CJSC is often carried out to accumulate large funds necessary for the creation, management and registration of large companies. The members of the CJSC own shares, which determine their right to property and management of the Closed Joint Stock Company.
Registration of OJSC is the registration of the joint-stock company in the organizational and legal form of OJSC – Open Joint-Stock Company. The difference between OJSC and CJSC is that the participants of the open joint-stock company have the right to alienate their shares without the consent of other shareholders.