Azerbaijan: Official corruption; the ramifications entailed by non-payment of bribes and the prevalence of organized crime (2005-2007)

Official corruption

Several sources report that corruption is a major problem in Azerbaijan (COE 23 June 2006, para. 5; Young Lawyers Against Corruption n.d.; Fund of Struggle Against Corruption Azerbaijan n.d.). Freedom House reports that "[c]orruption is deeply entrenched throughout society, with government officials rarely held accountable for engaging in corrupt practices" (1 Sept. 2006) while Radio Free Europe/Radio Liberty describes corruption in Azerbaijan as "rampant" and "cancerous" (21 Nov. 2006). In Nations in Transit 2006, Freedom House ranks Azerbaijan as 6.25 out of 7 with regard to corruption (1 being the highest level of democratic progress and 7 being the lowest) and states that corruption is one of the most important problems in Azerbaijan (6 Jan. 2007). In Transparency International (TI)'s Corruption Perceptions Index, Azerbaijan was ranked 130th out of 163 countries surveyed with a score of 2.4 (0 being "highly corrupt" and 10 being "highly clean") (6 Nov. 2006). Azerbaijan was not mentioned in TI's Bribe Payers Index or Global Corruption Barometer for the year 2006 (TI 7 Dec. 2006; ibid. 4 Oct. 2006).

A new law on combating corruption was adopted in January 2004 (COE 23 June 2006, Para. 6) and came into force in January 2005 (Freedom House 6 Jan. 2007; see also US 8 Mar. 2006, Sec. 3). In addition, a new state program aimed at fighting corruption was adopted in September 2004 (COE 23 June 2006, Para. 7) and came into force in January 2005 (Freedom House 6 Jan. 2007) along with a state commission to ensure implementation of the state program (COE 23 June 2006, Para. 8). However, Freedom House indicates that Azerbaijan has no effective process to investigate corruption perpetrated by government officials and civil servants, that anonymous complaints of corruption are not permitted under the law and that there is no effective witness protection program (6 Jan. 2007). The Institute of War and Peace Reporting (IWPR) corroborated this information by adding that 90 percent of the complaints received by the state commission on corruption were anonymous, yet the law did not allow them to consider anonymous complaints (12 May 2005). In its evaluation report on Azerbaijan, the Group of States Against Corruption (Groupe d'États contre la corruption – GRECO) of the Council of Europe (COE) reports that "Azerbaijan was making substantial efforts to address the problem of corruption, but nevertheless still appeared to be extensively affected by corruption, at all levels of society" (23 June 2006, para. 21).

Non-payment of bribes

Freedom House states the following regarding bribes:

Most people prefer to pay small bribes instead of the much higher fees imposed by the state. Thirty-three percent of Azerbaijanis report that they have paid bribes in the past; 20 percent say that they have been asked for bribes but have not paid and 33 percent say that they have not been asked for bribes in the past. Among Azerbaijanis who have paid bribes, the most common occasions are for medical care (12 percent) and higher grades for their school-age children (6 percent).... (6 Jan. 2007)

The Executive Director of Transparency Azerbaijan, the local chapter of Transparency International, provided the following information to the Research Directorate regarding non-payment of bribes in correspondence dated 6 February 2007. Transparency Azerbaijan conducted a survey to be published under the title "Country Corruption Assessment Business Opinion Survey in Azerbaijan" which includes the following information:

Resolution of any substantial tasks of the private sector (be it purchase or registration of property, legal assistance, any kind of inspection or audit, overcoming of administrative barriers) ... does not involve bribery ... in [only] one third of all cases. The [following] illustrates the probability of failure to solve an issue unless a bribe is paid.

70.5% To obtain a license or register a new business

66% To overcome administrative barriers raised by local authorities or police

64% Purchase or registration of a new business

62.5% Inspections and audit (fire brigade, epidemiologic and sanitary stations, etc)

56% Legal assistance

52.5% Import – export operations

51% Patronage of business by a public official

50.5% Tax agency

45% Protection of law enforcement bodies

45% Submission of reports to supervisory agencies

41% Award of state or municipal contract

39% Provision of a favourable legislative act

39% Protection of businesses from attacks of competitors

30% Obtaining legal information

The survey also revealed that in many instances the probability of bribe extortion is substantially lower than the probability to be refused a service without paying a bribe which allows [us] to conclude that many businessmen offer a bribe before being asked for it.

IWPR indicated that bribery by officials in Azerbaijan was on the rise despite the new legislation and new state commission (12 May 2005). Additional information as to the ramifications entailed by non-payment of bribes could not be found among the sources consulted by the Research Directorate.

Organized crime

The following information regarding organized crime was taken from a manual published by Transparency Azerbaijan in 2004:

Organized crime in transition economies differs from the classic Western Mafia model, which originated in the criminal sphere (arms trade, contraband). In transition economies, organized crime has developed largely as an offshoot of the legal economy. The money makers of the Soviet shadow economy, the so-called "tsekhoviks," stimulated the formation of a new economic "gray zone," or informal sector that did not fail to attract attention from leaders of criminal groups and allowed them to turn into a powerful sector of organized crime. After the demise of the socialist system, an active growth of both groups led to confrontation among themselves, as well as with the state. This process yielded different results in different transition countries. In Russia, shadow capital merged with criminal groups. In Azerbaijan, the state managed to prevent criminal leaders from active penetration in economic life. According to a survey conducted by Intermedia in Central and Eastern European countries, Azerbaijan has the lowest rate of Mafia-related violent crime in the region with a score of 12, while Russia scores the highest with a score of 65.

The Executive Director of Transparency Azerbaijan stated in 7 February 2007 correspondence to the Research Directorate that the above information is still valid. Additional information regarding organized crime could not be found among the sources consulted by the Research Directorate.

This Response was prepared after researching publicly accessible information currently available to the Research Directorate within time constraints. This Response is not, and does not purport to be, conclusive as to the merit of any particular claim for refugee protection. Please find below the list of additional sources consulted in researching this Information Request.

References

Council of Europe (COE). 23 June 2006. Group of States Against Corruption (GRECO). "Joint First and Second Evaluation Rounds: Evaluation Report on Azerbaijan." [Accessed 6 Feb. 2007]

Freedom House. 6 January 2007. "Azerbaijan." Nations in Transit 2006. [Accessed 2 Feb. 2007]
_____ . 1 September 2006. "Azerbaijan." Freedom in the World 2006. [Accessed 2 Feb. 2007]

Fund of Struggle Against Corruption Azerbaijan. N.d. "State Education Policy and Corruption Cases!" [Accessed 6 Feb. 2007]

Institute for War and Peace Reporting (IWPR). 12 May 2005. Gulnaz Gulieva and Rufat Abbasov. "Corruption Stifles Azeri Business." [Accessed 6 Feb. 2007]

Radio Free Europe/Radio Liberty (RFE/RL). 21 November 2006. RFE/RL Reports. Vol. 6, No. 7. Ahto Lobjakas. "Corruption: Azerbaijan Copes with Oil Windfall." [Accessed 5 Feb. 2007]

Transparency Azerbaijan. 7 February 2007. Correspondence from the Executive Director.
_____ . 6 February 2007. Correspondence from the Executive Director.
_____ . 2004. Rena Safaralieva, Sanar Mammadov, Vagif Gaziev. "Business Ethics: Manual for Azerbaijan Companies." Received through correspondence from the Executive Director [Accessed 6 Feb. 2007]

Transparency International (TI). 7 December 2006. "Global Corruption Barometer 2006." [Accessed 6 Marc. 2007]
_____ . 6 November 2006. "Corruption Perceptions Index 2006." [Accessed 2 Feb. 2007]
_____ . 4 October 2006. "Bribe Payers Index." [Accessed 2 Feb. 2007]

United States (US). 8 March 2006. Department of State. "Azerbaijan." Country Reports on Human Rights Practices for 2005. [Accessed 5 Feb. 2007]

Young Lawyers Against Corruption. N.d. "About Project." [Accessed 6 Feb. 2007]

Additional Sources Consulted

Oral sources: The president of the Center for Economic and Political Research did not have information on the subject.

The Institute of Peace and Democracy did not provide information within the time constraints of this Response.

Internet sites, including: Amnesty International; Anti-Corruption Network for Eastern Europe and Central Asia; Azerbaijan International; Caucasus Institute for Peace, Democracy and Development; Coalition to Improve Transparency in Extractive Industries; Commission on Combatting Corruption under the State Council on Management of the Civil Service; EurasiaNet; HR in Azerbaijan; Human Rights Watch; Office of the United Nations High Commissioner for Human Rights; Open Society Institute.