The decree will serve the interests of oligarch officials

Recently, the head of state signed a decree "On a number of measures to develop production and processing industry in the agricultural sector" and setting strategic goals to meet new challenges have a significant impact on the sustainable development of agriculture. 

It was also noted that the rapid development of agriculture in Azerbaijan, the reforms carried out in the agricultural sector and the definition of strategic goals that meet new challenges have had a significant impact on the sustainable development of agriculture. The preamble of the decree also notes that in order to expand a competitive agricultural processing industry and increase the cost of production along the links of the chain, it is necessary to accelerate work to provide producers with easy access to appropriate resources, including favorable financial resources, further improve market infrastructure and agricultural business environments.

It was also noted that the sustainable development of the agricultural processing industry in the country is important from the point of view of strengthening the export potential of the non-oil sector and ensuring food security. Considering this, it is believed that the mechanism for supporting the rise of agriculture should be improved purposefully and continuously. 

The head of state instructed the Cabinet of Ministers to prepare and submit to the President of the Republic of Azerbaijan projects to improve the regulatory framework in the following areas: division of lands into categories, transferring them from one category to another and changing their intended purpose; management, protection, prevention of their illegal use, as well as preservation, restoration and enhancement of their fertility; construction by producers of agricultural products on agricultural land of residential, irrigation infrastructure and temporary processing facilities; regulation of the activities of agricultural parks.

I should note that, as provided by the Land Code of the Republic of Azerbaijan, the land legislation of the Republic of Azerbaijan consists of the Land Code, the Law of the Republic of Azerbaijan “On Land Reform” and other regulatory legal acts. In accordance with the Land Code of the Republic of Azerbaijan, the decree regulates areas that provide for the improvement of the regulatory and legal framework, that is, the assignment of lands to categories, their transfer from one category to another and change of purpose, management, protection, prevention of illegal use of land, as well as protection, restoration and enhancement of their fertility.

In accordance with the intended purpose and legal regime, lands are divided into categories such as agricultural land, settlements, industrial, transport, communications, defense and other purposes, forest resources, water resources, reserve funds, specially protected areas.

In accordance with the law, the assignment of lands to categories and their transfer from one category to another are carried out in accordance with the established procedure by the relevant executive authority, that is, the Cabinet of Ministers of the Republic of Azerbaijan.

Over the past few years, the oligarchs-officials have seized hundreds of thousands of hectares of natural hayfields and forestlands, which were previously used by farmers and peasants on a contractual basis, and created large farms and agricultural parks on these lands. It should also be noted that in accordance with paragraph 2 of Article 86 of the Land Code "state land, common land, as well as agricultural land of municipalities, which are used and leased by legal entities and individuals, cannot be objects of purchase and sale."

This decree raises issues related to the assignment of land to categories, their transfer from one category to another and a change in the designated purpose. This means that a regulatory and legal framework will be created for the privatization or transformation into an object of purchase and sale of state and municipal lands that are used and leased by oligarch officials.

It should also be noted that 2.4 billion manats were spent from the state budget to create agricultural parks on 262 thousand hectares. Officials-oligarchs, who at the expense of state lands created large farms and agricultural parks, at the expense of the state drilled artesian wells, paved roads to farms, the uncertainty of the legal status of the farms they create is worried. I believe that the decree was issued in order to create a regulatory and legal framework for the transfer from one category to another of lands intended by law for general use only, and changing their designated purpose.

The decree also provides for the development of projects by agricultural producers to improve the regulatory framework for the construction of residential, irrigation infrastructure and temporary processing facilities on agricultural land.

In accordance with Article 13 of the Land Code of the Republic of Azerbaijan, communications, temporary structures can be installed on agricultural lands in accordance with the relevant environmental and technical requirements that are important for the effective organization of agriculture. However, the law does not provide for the construction of temporary buildings for living on agricultural land.

In accordance with paragraph 2 of Article 9 of the Land Code, residential and industrial lands are determined. I believe that there is no need for a new regulatory framework for the construction of temporary housing projects, irrigation infrastructure and processing by agricultural producers on agricultural land. In fact, according to paragraph 2 of Article 13 of the Land Code, communications, temporary structures and structures can be installed on agricultural land that meet environmental and technical requirements important for the effective organization of agriculture.

However, the creation of a legal basis for the construction of temporary residential buildings on agricultural land by producers of agricultural products can lead to very serious problems. Agricultural lands of the Republic of Azerbaijan are gradually decreasing for a number of reasons. Why is it necessary to build temporary residential buildings on agricultural land for producers of processed products? If temporary residential buildings are intended for employees working at the enterprise, then this is not necessary.

In Azerbaijan, due to the large number of rural population and small land areas, villages are located close to agricultural land. It is best to establish processing enterprises in villages and regional centers. To use the services of local workers and specialists in these institutions. Thus, it is also possible to provide jobs for some of the hundreds of thousands of unemployed people living in the countryside. On these lands, peasants, farmers will be engaged in the production of raw materials for processing enterprises.

Under the decree, the Cabinet of Ministers should prepare and submit proposals to the President of the Republic of Azerbaijan on the preparation of projects to improve the regulatory framework related to the regulation of agricultural parks, as well as to expand the capabilities of enterprises operating in the field of agricultural production, and the use of agricultural parks as a mechanism to stimulate investment.

What is the need for training or, as indicated in the document, for improving the legal framework for regulating the activities of agricultural parks, in which the names of civil servants and their close relatives are documented? It is required to prepare proposals to expand the possibilities of agricultural parks to use the investment incentive mechanism. What does it mean? This means that the state provides entrepreneurs with the opportunity to take advantage of tax and customs benefits. That is, the owners of the agricultural park as a legal entity will be exempt from 50 percent income tax for 7 years, and will be exempt from land and property tax.

In addition, officials-oligarchs and owners of agricultural parks will receive tax and customs privileges on the import of machinery, technological equipment and installations and will be completely exempt from VAT and customs duties on the import of this equipment, technological equipment and installations for a period of 7 years.

In the decree, the Ministry of Economy of the Republic of Azerbaijan, together with the Ministry of Agriculture of the Republic of Azerbaijan, was instructed to take measures to create a mechanism for the temporary use of agricultural land in areas where land reform has not been carried out, and to inform the President of the Republic of Azerbaijan about the results. I should note that the territories where the land reform has not been carried out means the lands liberated from the occupation, where de facto some companies are already sowing and harvesting.

Under the decree, the Ministry of Economy of the Republic of Azerbaijan, together with the Ministry of Agriculture of the Republic of Azerbaijan, should take measures to create a mechanism for the temporary use of agricultural land in areas where land reform has not been carried out, and to inform the President of the results.

The Ministry of Economy and the Ministry of Agriculture of the Republic of Azerbaijan are not required to develop a mechanism for distributing lands that have not undergone land reform among peasants who were previously engaged in agriculture, but on the contrary, they are instructed to form a mechanism for their temporary use by others. Thus, the decree of the head of state "On a number of measures to develop production and processing industry in the agrarian sector" will serve the interests of the oligarch officials.

Thus, the oligarch officials, illegally seizing state and municipal lands intended for general use, will easily achieve the transfer of these lands from one category to another, change their purpose, privatize, and convert state lands into objects of purchase and sale. Oligarchs who own agricultural parks will be able to take advantage of tax and customs benefits of the state. Of course, the receipt by officials of the oligarchs of such benefits and their further strengthening at the expense of state benefits, unfortunately, will lead to the disappearance of small and medium-sized entrepreneurs, which provide almost 90 percent of the country's population with food.

Vahid Magerramov