Financial Crime World

Customer Due Diligence (CDD) in Azerbaijan

Applicability and Purpose of CDD

In Azerbaijan, customer due diligence (CDD) requirements apply to all monitoring entities, including banks, financial institutions, and other organizations. The primary purpose of CDD is to prevent money laundering and financing of terrorism by identifying and verifying customers.

Measures for Verification

  • Compare information with state registers
  • Obtain information from mass media or official publications
  • Compare latest submitted information with previously received information

Natural Persons

  • Confirm date of birth using documents like a passport, driving license, or birth certificate
  • Confirm permanent address using utility bills or extracts from state registries

Ongoing Due Diligence

Monitor transactions to ensure consistency with the customer’s business profile and risk assessment.

Enhanced Due Diligence

Higher-Risk Customers

Apply for higher-risk customers (e.g., non-resident customers, trusts, companies with nominee shareholders).

  • Perform additional verification of accounts, business relationships, or transactions.

Refusal to Conduct Transactions

If unable to identify or verify a customer, refuse to open an account, commence business relations, or perform a transaction.

Reporting Requirements

Inform the financial monitoring organ if CDD measures cannot be met.

Additional Requirements

Existing Customers

Conduct due diligence on existing relationships at appropriate times.

Specialized Industries

Natural and legal persons involved in purchase and sale of precious stones, metals, or jewelry; and those providing intermediary services for real estate transactions must apply CDD measures to cash transactions above a certain threshold.

Important Note

This summary is not intended to be comprehensive or definitive, but rather a brief overview of the key points related to customer due diligence. If you need more detailed information or clarification on specific aspects of the law, I recommend consulting the original text or seeking advice from a qualified expert in Azerbaijani law.