Azimport won over 700 tenders in 10 years (part 1)


Construction workers who built facilities for the 2015 European Games have yet to receive their wages almost a year later. The company that contracted them, Azimport, has won over 700 tenders with the wholly state-owned State Oil Company of Azerbaijan Republic (SOCAR) in the past 10 years.

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“I was the one to tell other construction workers about this job. We were told the job needed to be completed urgently before the [European] Games kicked off. So we worked day and night for two months,” construction brigade leader Elshan Aliyev tells Meydan TV.

“We even completed the job two months before the Games. However, we still haven’t been paid the remainder of our salaries. Azimport representatives tell us that once SOCAR pays their fees, they will pay our wages as well,” he adds.

Construction workers who completed their job two months before the European Games last year claim that they had been working with the field manager Rauf Ismayilov and followed his instructions.

Azimport won a tender with SOCAR to undertake renovation works in the Shangai area of the Bayil settlement for the 2015 European Games. They have not paid wages to their 540 construction workers. Construction workers staged a protest last year demanding their salaries.

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“Azimport won our tender,” SOCAR’s spokesperson said. “We have paid them partially. If the company chooses not to pay its employees, it is not our fault.”

SOCAR claims Azimport won their tender. However, they did not respond to inquires about what other companies bid on tenders, and why Azimport was selected. Nor did they share any insights as to the conditions of awarding tenders to carry out renovation works at the Bayil settlement’s Shangai area.

How is public procurement regulated by law?

Lawyer Samira Aghayeva broke down the procedures that state-owned entities are required to follow in order to solicit tender bids, according to the Azerbaijani law on public procurement.

“The client puts together a tender committee, drafts the terms of reference, and finally, when the tender committee confirms the tender announcement and its conditions, the tender announcement is either printed out, or individual invitations are sent out to service vendors.”

“The announcement for an open tender must be made at least 30 working days prior its first opening, and at least 20 days prior to its second opening,” she adds.

The law stipulates that tender announcements “must be placed in well-circulated state papers as well as well-known international mass media outlets,” the lawyer adds. “It must also be published on their official website. Two-stage tender announcements must be made at least 60 days prior to the tender for the first time, and at least 40 days before it is opening for the second time.”

“Along with making public announcements on the opening of the tender, the client may also send out individual invitations to the providers,” Aghayeva says.

No employment contracts were signed

Construction workers who worked for Azimport claim that they never signed any employment contracts with the company to safeguard their rights.

Azimport told the media the following in response to allegations of non-payment: “Those 540 construction workers who claim they are not able to receive their money have been employed by subcontractors and individual entrepreneurs. Therefore, Azimport LLC is not responsible for not signing employment contracts with those workers.”

In response to our inquiry, the head of the company said that the Shangai project was managed by a subcontractor named Rauf Ismayilov. The company dealt with Ismayilov directly. However, Ismayilov also claims that the company has never signed any employment contract with him either.

“I have been working for this company for around six years now,” he said. “I have overseen the personal construction projects of the company’s owners, such as Nar Sharab and Mangal restaurants, hotels, etc. However, they have never signed a subcontract or an employment contract, or for that matter any kind of agreement with me.”

Azimport LLC refused to show any contracts or tender documents, claiming that the documents constitute a commercial secret.

“We have yet to receive the money”

The workers involved in the project summarized their work with SOCAR the following way: “Our job was to apply emulsion to the roof and walls. SOCAR agreed to pay 4.87 manats for each square meter of applied red emulsion on the roofs and 3.21 manats for applied white emulsion on the walls. We completed 2.241 million square meters in total. Rauf Ismayilov promised to pay us 60 cents for white and 70 cents for red emulsion applied per square meter. We also know that SOCAR spent around 13 million manats for this project. They owe us just a small fraction of it – 750,000 manats for 540 workers.”

“It has now been a year, and we have yet to receive this money,” the say.

When asked about payments for construction workers, a representative of Azimport said the following: “The company has already paid around 2.289 million manats in wages to people involved in this project. Only 1.1 million manats out of this amount was paid from the client’s transfer to our accounts. The remaining 1.189 million manats in employee wages had to be paid from company’s own funds. The remaining payment is delayed due to the financial difficulties faced by the client as it was explained in their letter. It was agreed to proceed with a gradual payment plan in the future.”

Although Azimport claims to have paid 2.289 million manats in wages, the workers say they only received 650,000 manats last year.

“Rauf Ismayilov handed us a paper with his own handwriting. It said the company paid him 1.878 million manats. Rauf Ismayilov took 126,000 manats out of that sum as it was Azer Asgarov’s debt to him for completing a personal project. The rest was spent on materials. They only paid us 650,000 manats,” the workers say.

Rauf Ismayilov admitted to taking a portion of this money in return for a personal debt he was due. However, he said he had done it with Azer Asgerov’s permission.

Details the workers did not know

If the numbers the construction workers showed us are correct, then how is it possible that the extra payment was made to the second company although the agreement was made between the client and the service provider based on certain specifications? How is the difference between what the client pays to the service provider and what the provider pays its employees regulated?

Economist Zohrab Ismayil says it all depends on the agreement between SOCAR and Azimport: “The construction workers probably wouldn’t know the details of this agreement. If the indicated area is correct, then the already made payment is not much. However, 2.241 square meters seem to be too much. For instance, if we calculate each house to be 70 square meters, it adds up to over 30,000 houses. Or perhaps, it could be calculated as 2.24 square kilometers. I think this is where the fraud is.”

Every street in Baku has Azimport’s footprint

At first glance, the company name of Azimport may not sound familiar to the readers. However, when we took a closer look at the projects the company has led in the past, it became abundantly clear that each and every street in Baku has Azimport’s footprint.

Azimport was founded in 2004. Currently, the company’s legal representative is Ragib Habibov. The company website listed the following entities as Azimport’s partners: Baku State Design Institute, Azerbaijan state project institute, Scientific Research and Design Institute of Building Materials named after S.Dadashev under the Emergency Situation Ministry, Ares Lighting systems, Sylvania, Dae Lighting, Goccia, Good, Directions, Paber, Fumagalli, Osram, Gewiss, Avolux lighting, Landa, Fisher, LEA ceramiche, Escofet, Sahne-lighting, Doapark, Milastones arts, and others.

The company’s co-founders are Azer Asgerov and his brother in-law, Rashad Mammadov. Mammadov, currently incarcerated, is the former Head of Office of State Flag Complex.

Following Mammadov’s arrest, State Flag Complex said the following at a press conference: “The moment Rashad Mammadov was appointed as a civil servant, he cut his legal and factual ties with the company. Thus, the company’s current founder is Azer Asgerov.”

Rashad Mammadov was appointed the head of the State Flag Complex pursuant to President Ilham Aliyev’s decree signed in 2011. However, he was fired in May 2015. A few days later, Mammadov was arrested on charges of fraud. He is currently detained at the State Security Services detention facility, formerly known as the Ministry of National Security. Media reports indicated that Azer Asgerov was also detained along with Mammadov but released the following day. Last December, a statement issued by Azimport stated that Azer Asgerov was threatened by theMinistry of National Security.

“We should note that in the mentioned time period, Azer Asgerov has been subjected to pressure and persecution from the former heads and employees of the Ministry of National Security. He was pressured to testify against high-ranking officials. They even tried to pressure him into signing witness statements claiming that his close relative, Rashad Mammadov, the former co-founder of Azimport, who cut off his legal and factual ties with the company the moment he was appointed the head the State Flag Complex, was still the unofficial owner of the mentioned enterprise,” the statement read.

“They searched the office without legal grounds, and took some cash from the safe as well as property ownership papers that belonged to the company and its employees with the intention of registering those properties under their own names. Their aim was to seize the company assets, the company Azer Asgerov founded and put so much work into, the company that has successfully implemented a number of important projects in Baku, the company that is known for its innovative entrepreneurship,” according to Azimport’s statement.

As mentioned in the company’s statement, since its establishment, Azimport has led numerous construction, repair and renovation works in and around Baku. These projects include but are not limited to White City Boulevard, Heydar Aliyev Park, renovation of the Fountain Square, Baku Boulevard (Neftchiler Avenue), facade changes of the buildings on Fountain Square, Bayil Boulevard in Baku, schools number 6, 134, 23 and 26, Sabir Garden, Officers Garden, Technical University, former National Security Ministry’s hospital, buildings on Gurban Abbasov, Jeyhun Hajibeyli and Abdulla Shaiq streets. As the company founder Azer Asgerov says, there are many more similar cases of construction and renovation works around the city.

The same company has won construction tenders for the past 10 years

Azimport has won the lion’s share of construction and renovation in and around Baku in the past ten years.

When asked about whether Azimport has previously partnered with SOCAR, Azer Asgerov said the following: “We have been working with SOCAR for the past 10 years now. Over these years we have completed over 700 projects for them. Of course, we won tenders each time. Bayil Boulevard, White City Boulevard, schools number 6, 134 and 23 were among them.”

According to Asgerov, Azimport won over 700 tenders with SOCAR. SOCAR’s press service did not answer our question about the conditions of those 700 tenders. It begs the questions: how can a state-owned company select the same winner over 700 times in the last 10 years?

Economist Zohrab Ismayil explains: “Obviously, it is illegal if it happened without a tender. However, even if there was a tender for each case, selecting the same company over and over again so many times raises questions and leads one to think that there was corruption involved.”

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