The Constitutional Court will decide on what course to return bank loans

Plenum of the Constitutional Court of Azerbaijan considered the question at what rate banks must return  citizens the bank loans obtained in dollars. Consideration was initiated by Goychay District Court and the Ombudsman. They asked the Constitutional Court to give the interpretation of  Articles 439.1, 439.2 and 439.7 of the Civil Code, as they are in conflict.

Article 439.1. provides that a financial liability must be expressed in manats. If one of the parties is a foreign person or entity, the parties may determine the monetary obligation in foreign currency.

Article 439.2. states that the monetary obligation in foreign currency payable in Azerbaijan is repaid in manats, except when stipulated payment in foreign currency. The translation is performed at the exchange rate at the time of payment.

Article 439.7. said that if before the due date currency exchange rate increased or decreased, or changed the currency, payment is made at the rate corresponding to the time of occurrence of the obligation.

If the currency rates chnages, exchange relations must  be at the rate which existed between the monetary units  on the day  of the changes in exchange rates. (17)

In the discussions participated representatives of Goychay Court, the Ombudsman, the Parliament, and the Central Bank. Decision of the Plenum will be made public soon.

On February 21 the Central Bank carried out the devaluation of the manat,  as a result  the national currency depreciated by 34% against foreign currencies. According to unofficial information, citizens that received loans in dollars, should  pay  banks  AZN 1.2 billion, what angered investors. -03D-