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JOINT STOCK COMPANY (JSC)​

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JSC is an entity structured with a defined capital, divided into shares, and established by one or more legal entities or individuals. Shareholders bear responsibility solely for the capital shares they have pledged to the JSC.

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JSC is divided into two categories: “closed” and “open”. Closed JSC has non-negotiable shares and requires a minimum capital of AZN 2,000, while open JSC allows shares to be freely traded, with a minimum capital requirement of AZN 4,000. Complete payment of charter capital for JSC is a prerequisite for the registration to proceed.

 

Both LLC and JSC share numerous similarities, including the requirement of at least one founder, limited liability for shareholders/participants, identical treatment from the tax point of view and etc. However, LLC offers greater flexibility in structuring internal operations and is subject to fewer registration and reporting requirements than JSC. For instance, JSC requires the registration of securities and the disclosure of financial statements. Considering this, JSC can be categorized as a suitable legal structure for conducting particularly extensive investment activities in Azerbaijan. In the context of setting up joint ventures with local partners, LLC is generally regarded as the most appropriate choice.