Description:

The article discusses the concept of the Production Sharing Agreement (hereinafter referred to as the PSA), the characteristics of its implementation in Azerbaijan, as well as the advantages the agreement brings to the country. The limited availability of local research and literature on the subject, coupled with the general scarcity of educational resources, has highlighted the need for a more thorough investigation of the topic. The article also examines the methods of implementing PSA agreements by operating companies, the obligations and guarantees designated for them, as well as the preferential features such as tax and other exemptions for contractors and subcontractors. The article discusses the rules for imposing and exempting import and export taxes on goods, works and services provided in connection with hydrocarbon activities in the Republic of Azerbaijan, as well as the procedures to be used in their application, as well as the Customs and Tax regulations related to the export of hydrocarbons based on the Agreements. It also discusses the requirements of local legislation in this area and the procedure for compliance with these requirements by operating companies and their contractors/subcontractors, and the necessity of this.