The Green Card System

Stimulated by the United Nations Economic Commission for Europe (UNECE), the Green Card System was founded in 1949 (on the basis of Recommendation No. 5 adopted by the Working Party on Road Transport of the Inland Transport Committee) in order to facilitate cross-border traffic.

The Green Card System is a Treaty on mutual recognition of the compulsory third party liability insurance of motor vehicles policy by the parties of the system, namely by the participant-countries. According to this system, the third party liability insurance of motor vehicles policy issued by any government of Parties to the Treaty on “Green Card” shall be considered valid in the territory of the other governments which are Parties to the system. Currently 47 countries are members of the system.

The main objective of the System consists of the provision of the reimbursement of the damage in accordance with the legislation of the country where accident took place caused by the owners of the vehicles visiting any country which is member of the system, whose liability is insured in conformity with the national legislation of the country where they are originating. For this purposes, on the base of mutual guarantee of the member Bureaux, centralized provision system – «Green Card» insuring liability of the drivers in the course of travel to the foreign countries by the motor vehicles is provided.

As a result, obtaining green cards from the insurers of the driver’s country traveling by motor vehicles within the scope of the system means the insurance of their liabilities during the travel and discharges them from obtaining new insurance at the border of each country.

In order to reimburse the damage occurred within Green Card system, there were established Green Card Bureaux in each member countries. These Bureaux guarantee insurance payment in the country of accident for damages and injuries of third parties suffered in the traffic accidents caused by foreign drivers within Green Card System frame. Then, Green Card Bureaux where accident took place, obtain the right for reimbursement of insurance payments from the Green Card Bureaux which granted Green Cards to insured.

Compulsory Insurance Bureau of Azerbaijan Republic applied for accession to the Green Card in 2012.

Initially, the application got positive feedback and Bureau was acquainted with necessary legal and other requirements put forward for Bureaux willing to join to the System.

It is worth noting that Bureaux willing to join to the Green Card System take over a number of responsibilities which is required in this field.

Accession to the “Green Card” system involves implementation of comprehensive action plan covering legal, technical, administrative, financial and other varied aspects.

It should be noted that, there were made amendments to the Law of Azerbaijan Republic “On Compulsory Insurances” and these amendments came force on 25 December 2014. According to the amendments to the Law of Azerbaijan Republic “On Compulsory Insurances” dated 28 November 2014, there were added new provisions due to accession of Azerbaijan to the Green Card system. The accession of Azerbaijan to the Green Card system is expected from 1 January 2016.

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