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February, 1922 the authorized representative of the RSFSR foreign trade
Commissariat in Azerbaijan S.Chasovenniy in his letter N1125 to the chief
of Azerbaijan SSR Customs Department wrote: “On the decision of the
Azerbaijan Communist Party Central Committee was banned taking of oil
products, iron, empty iron barrels, manufacturing goods, timber, and sugar
by private persons to Iran. Nevertheless, the export of these goods belongs
without exception to RSFSR People's Commissariat of Foreign Trade and
the South Caucasus Socialist Republic’s regional Department of Foreign
Trade” [9, p.98]. The representative in his another letter dated 15 April 1922
addressed to the Commissioner of Finance of Azerbaijan H.Taghiyev wrote:
“... Under the agreement between the Republics of Azerbaijan and Russia
signed on September 30, 1920, and the decisions of the ASSR Supreme
Economic Council and the NCC and the RSFSR People's Commissariat of
Foreign Trade commodities should be allowed from the area of the ASSR
duty free and without any obstacles, as there is no and cannot be customs
border between the Soviet republics. In view of the above-mentioned, we
make you a request to order the Azerbaijan Customs-house in relation with
the duty-free allowance of 630 pounds of rice brought in the ship “Dages-
tan” from Iran to Azerbaijan”. The next time the representative of the
RSFSR foreign trade, in his letter dated May 21, 1922, objects to the Azer-
baijan Customs-house for continuous allowance of goods – sugar, glass and
metal products, matches and other commodities to Iran and stated that such
cases along with being illegal, paralyzes the fulfillment of the task of the
RSFSR People’s Foreign Trade Department and the South Caucasus provin-
cial foreign trade department charged with the center [10, p. 82].
The chief of the Azerbaijan Customs Department Ahmad Rzayev in
his report to the government dated June 13, 1922, made his consideration
for monopolization of foreign trade by center, taking to monopoly of some
groups of commodities (sugar, cotton cloth, timber materials, metal wares,
milk cans and milk churns, etc.) by government, i.e. the prohibition of their
allowance without the license and to the exemption from the customs duty.
It was stated in the report that the main reason for it was providing by the
South Caucasus foreign trade department the specific traders for certain
amount of money with forged certificates on being of goods passed through
the customs state-owned. For example, in accordance to the license given to
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the citizen Mir-Habibov by the management of this office in Tiflis on June
1, 1922 which was obtained for the 700 million money for export of 1000
pound granulated sugar to Iran, who in turn, sold this document to Seyfulla
Husseinov. Merchants benefited from the “favorable conditions” with cer-
tificates illegally obtained from the Baku branch of the RSFSR PFTC car-
ried foreign currency capacious goods across the border without any cus-
toms duties. Based on the statistical figures can be noted that, despite the
prohibitive measures, the total volume of imports in the state sector was
back than the private trade.The right for export of Azerbaijan's oil products
was given to the society “Neftexport” created by the decision dated July 21,
1922 signed by the RSFSR foreign trade Commissioner L.Krasin. Goods
were considered to be exported from Baku, Batumi and Poti ports to Iran,
Khorasan, Turkey (Istanbul province being exception), Syria, Palestine, Per-
sian Gulf and Bulgaria. Solution of all issues relating to the export of oil
products, including the authority to permit the transportation of goods to
Iran by sea was taken from the Baku representative of the Foreign Trade
Commissariat and given to Serebrovski, the head of Azneft. Oil products
would be allowed with the permission of “Neftexport” without obstacles
and customs duties. However, the representative of the South Caucasus for-
eign trade department in Azerbaijan A.Gulubeyov, who was invited to the
conference dedicated to the export of oil products held on July 11, 1922 in
Azneft, and acting chief of Baku customs A.Dudanginski protesting this had
emphasized the importance of coming to consent with the Union Council of
South Caucasus SSFR and the Azerbaijan Communist Party Central Com-
mittee [11, p.12].
Inclusion of the Azerbaijan SSR to the sphere of economic interest of
Russia had become more extensive after the unification of the South Cauca-
sus republics in a single union. Despite the establishment of “Zaqfedera-
siya” in March 1922 was mainly related to political and military factors, it
was inspired to public consciousness that for economic restoration and de-
velopment of economy there needed “to unite efforts of the Caucasian peo-
ples”. In this case, it was assumed that each of three South Caucasian repub-
lics had different customs prohibition and the separate units of money. In
fact, the main purpose was to get the economic dividends for Russia and
Armenia on the account of Azerbaijan which had abundant natural re-
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sources, including oil resources. On December 10, 1922, with the adoption
of the constitution of the South Caucasus SFSR uniting of foreign trade
Commissariats was legally justified. In March 1922, the Azerbaijan Foreign
Trade Commissariat was abolished and the authority for the management of
foreign trade operations from a single center was given to newly established
South Caucasus SFSR Commissariat of Foreign Trade. Departments of this
Commissariat were established in separate republics, including Azerbaijan.
In August of the same year, local branches of the Commissariat were re-
placed by the import-export offices [12, p.3]. On December 30, 1922, the
creation of the USSR, uniting the soviet republics as a common state, man-
agement of foreign trade and customs system from a single center, com-
pletely put an end to the implementation of Azerbaijan SSR government’s
initiatives in this area. Legal maintenance of the Soviet Russia’s economic
and trade interests by hastily signed bilateral and multilateral agreements
later realized the fact of creation of the USSR.
The expansion of production, restoration of the national economy and
tendencies observed in the development of foreign trade demanded the im-
provement of the legal framework for customs control. Without this, would
not be spoken about the effect of the customs policy. Until February 1922,
Azerbaijan SSR made use of the RSFSR’s, in many cases, Russian Empire’s
1903 year customs tariff and other documents published until 1917. In Feb-
ruary 1922, the RSFSR NCS approved the export and in June the import tar-
iffs. The first customs tariffs were made in customs-tariff Committee estab-
lished in PFTC. The main objective of these tariffs was to protect the state
monopoly of foreign trade. Customs-houses located in the border and within
of the territory of the country strictly controlled the observation of the li-
cense rule and prevention of smuggling. Protection of the economic interests
of the country was the duty of the customs service, and the military and po-
litical aspects of the protection were the duty of the State Political Admini-
stration (SPA). On the next stage, the Soviet government doubled the pro-
tection of the state border from the standpoint of the customs. In charge of
the protection of the state border control, cooperation between the political
management and the customs services was established. The Regulation con-
sisting of 15 items which was sent to the local Customs-houses and political
branches on January 31, 1923 by Customs Office of the South Caucasus and
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