Azerbaijani state-owned companies will pay at least 30% of net profit to state budget as dividends starting from 2026
BAKU. Dec 30 (Interfax) - State-owned enterprises in Azerbaijan are now required to pay at least 30% of their net profit to the state budget as dividends.
According to information from the country's Finance Ministry, this norm is stipulated in the rules for distributing net profit and the general parameters of the dividend policy of legal entities in state ownership, legal entities whose controlling stake/shares belong to the state, and public law entities approved by Azerbaijani President Ilham Aliyev.
These rules will come into force on January 1, 2026.
At the same time, state-owned enterprises will be exempt from the obligation to pay dividends to the state budget if their net profit for the reporting year is below 100,000 manat. For a number of state companies (from the transport sector and the security sphere) this norm is reduced to 20,000 manat.
The goals of adopting these rules are: determining the dividend income of state-owned enterprises, ensuring that the activities of a state-owned enterprise correspond to the social and economic interests of the state, stimulating the effective and profitable activity of state-owned enterprises, ensuring long-term development and maintaining the financial stability of the state-owned enterprise, and ensuring the optimal distribution of net profit.
By May 1, the Finance Ministry will send a letter to state-owned enterprises regarding the preparation of forecasts for dividend payments to the state budget for the next year and the corresponding reporting forms.
Based on the actual figures of the previous reporting year, enterprises submit information to the Finance Ministry by July 1 of the current year on forecasted figures for dividend payments for the following year.
In Azerbaijan's state budget for 2026, dividend income from state-owned enterprises is projected at 600 million manat ($353 million at the current exchange rate). The majority of these dividends will come from the State Oil Company of the Azerbaijani Republic (SOCAR) and the country's largest bank, the International Bank of Azerbaijan.
Until now, the country lacked norms regulating dividend payments by state-owned companies. The government made decisions on an individual basis regarding which enterprise would pay dividends and in what amount.
The official exchange rate on December 30 is 1.7 manat/$1.
