Azerbaijan is not a member of the International Center for the Settlement of Investment Disputes. Although a bilateral trade treaty is in effect between Azerbaijan and the United States, negotiations for a bilateral investment treaty have not yet been completed. Selling to the central government or to state enterprises is difficult, particularly outside the energy sector. Major oil revenues are not expected to flow to Azerbaijan before November 1996. At present, the government is running arrears in payments to domestic suppliers.
State enterprises are often two to three months late in paying their own employees.
Firms selling to the Azerbaijan government should be particularly careful to specify beforehand how the value-added tax will be handled. The manufacturing sector remains in government hands. However, energy prices have been raised and there are no direct government export subsidies. Export tariffs are levied on most goods. As specified by the foreign investment law, goods produced from imported raw materials and goods produced by foreign investors in Azerbaijan are exempt from the duty.