Fines do not stop violations of rights of investors

Repeated increase in penalties for violations of the legislation on the rights of investors in October 2013 does not seem to affect the situation on the observance of fundamental rights in the securities market. Despite the huge Azeri standards for administrative penalties, companies continue to violate the rights of investors.

According to the report of the State Committee for Securities, this department oversees YTD received 117 written complaints, in which investors claimed that 336 joint-stock companies violated their legal rights. Appeals by companies decreased only 2 %. According to the investigation of complaints, the SSC has applied administrative sanctions against 66 entities totaling 108,000 manat, which is 6.5 times more than in January- April 2013.

In compliance with the law, the annual accounts of companies, not covered by the consolidated balance sheet, are to be provided to the general meeting of founders before April 30, at the expiration of the fiscal year. However, this requirement is not met by nearly 9 out of 10 companies. From the beginning, the SSC annual reports were presented by 80 JSC. The media published some of these reports.

In Azerbaijan there are about 1 600 JSC. SCS does not disclose a summary of the issues and liquidations of securities.

The legislation provides for the application of the penalty for violations of the rights of shareholders in the amount of 600 to 4,000 manat as against officials and legal entities. SCS only imposes a fine against the company. - 08D-