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May 27, 2014


May 27, 2014

economy.. 2

Farm Machinery Industry Refined. 2

Business climate.. 3

Uzbekistan bans to complicate business procedures without warning. 3


The sources of international trade law.. 3



Press-service of MFA of the Republic of Uzbekistan




Farm Machinery Industry Refined

Today’s agriculture has long been an area where people widely use modern energy efficient equipment and machinery, not just manual labor. Uzbekistan’s farms currently operate powerful tractors and harvesters, as well as a wide variety of tractor-mounted and tractor-hauled tools manufactured in the republic through cooperation with the world’s leading corporations Claas, Case, Lemken and others.

However, the world does not stand still; almost everywhere around it, agricultural practices are being regularly improved in terms of efficiency, which is necessary for maintaining any country’s food security. These efforts are especially important under the current climate change conditions and cataclysms occurring quite frequently, for they affect both the harvests in many regions and, in general, the global food market situation.

A few years ago, a drought in Russia and Kazakhstan, for instance, caused the prices of flour and buckwheat to shoot up. That is why, to prevent situations like this, farmers try their best to introduce modern agricultural technologies and machinery allowing for better protection of the crops from the harmful effects of their environments. Last week in Uzbekistan, a new step in improving the country’s agriculture was taken. The President signed the decree on establishing Uzagroprommashholding – a new agricultural machinery holding company to be an open joint stock company. Experts say this entity will allow for a significant improvement in managing agriculture machinery businesses and contribute to their efficiency.

The company will first of all engage in pursuing a uniform development policy in the industry. It will be based on modernization, technical and technological renewal, re-equipment and putting up-to-date, efficient and competitive machines and tools into production. The key strategy steps will include conducting specialized market research. After the supply and demand, as well as the quality of the products available in the market, have been assessed, Uzagroprommashholding will control the production and supplies as to the demand and take measures to increase their competitiveness, expand the product range and build up the exports. As an incentive, the President signed a decree exempting the holding company from the taxes on the land and property of its constituent companies till January 1, 2019.

The three largest agricultural machinery manufacturers of the country – Tashkent Tractor Plant, Chirchikselmash and Aggregate Plant – are undergoing serious changes. The first two will be closed down and serve as bases for Tashkent Agricultural Machinery Plant and Chirchik Agricultural Machinery Plant respectively, and the third will be reorganized.

Specialization, one of the key features in machine building industries today, must allow for quick modification of a certain product within the available product range to satisfy the new market demands quickly. The three country’s manufacturers are going to operate on this principle of specialization: Tashkent plant is going to specialize in manufacturing tractors, cotton harvesters and trailers; Chirchik plant is going to produce tractor-mounted and tractor-hauled tools, using part of the equipment and technologies relocated from Aggregate Plant, which is going to produce components and spare parts.

According to the presidential decree mentioned above, the government is to develop and approve the program of further improvement of agricultural machinery service support system in the republic for 2014 – 2016 within a two-month period. This document is expected to provide for introduction of modern methods and technologies of servicing agricultural machinery, further localization of spare parts production, and taking measures to prevent using counterfeit and low-quality spare parts in servicing.

In addition to these steps, the program is to provide for more measures to stimulate the local farm machine operators, as well as a substantial improvement in training personnel for operating and servicing agricultural machinery, which will include closer cooperation of certain industry-related higher education institutions and vocational colleges with farms and their machinery terminals.

(Source: “Uzbekistan Today” newspaper)



Business climate

Uzbekistan bans to complicate business procedures without warning

Uzbekistan amended rules on preparing and adopting departmental normative-legal acts with the decree of the Minister of Justice. The decree will come into force on 1 June 2014.

According to the amendments, the draft normative-legal acts, related to activities of business entities, should be studied for complication of business procedures and imposition of additional liabilities to legal entities.

The amendments said that if there are doubts, the ministries and departments can direct the draft document to the Ministry of Justice for consideration.

The legal documents, which complicate business procedures, impose additional liabilities to legal entities, as well as introduce new measures of legal responsibility, will come into force after three months from the date of their publication.

The rules also ban to impose sanctions against businesses entities in line with the legal documents, which were not published on official website of the state bodies.




The sources of international trade law

“In the past few years, a stable upward trend has been already observed in the exports volumes of finished competitive produce. In 2013, for instance, non-raw stuff has accounted for more than 72 per cent of the overall volume of Uzbek exports, which per se, testifies to the diversification of the national economy”. (The report made by the President Islam Karimov of the Republic of Uzbekistan at the sitting of the Cabinet of Ministers dedicated to the results of the country’s socio-economic development in 2013 and the major priorities of the 2014 State Economic Program).

This is exactly how the President Islam Karimov of the Republic of Uzbekistan has characterized the tendencies observable in the nation’s exports sector in his address to the sitting of the Cabinet of Ministers that discussed the outcome of the nation’s socio-economic development in 2013 and the main priorities of the State Economic Program for the year 2014.

However, it should be pointed out from the beginning that the further development of exports and foreign economic activity as a whole doesn’t seem feasible without the comprehensive knowledge of the basic rules regulating the relationships in the field of international trade. These rules are brought together in a common section, called “International trade law”.

It is accepted to regard international trade law as a system of norms and principles, which are designed to streamline all sorts of relationships that may arise in the field of international trade and is a part of international economic law. Since international economic law is a branch of international law, then international trade law is its sub-branch. And as any law, international trade law has its own sources (International trade law.

The main sources of international trade law include the national legislation, international trade agreements and legal documents, as well as international customs. (The conception and subject of international trade law. ( The national legislation comprises all home legal documents that regulate a complex of legal relationships under international commercial contracts, with the Constitution topping the list (pp.53-54). (The Constitution of the Republic of Uzbekistan. IPTD Uzbekistan, 2012, p.11).

The next source of international trade law is the Civil Code of the Republic of Uzbekistan , which contains a whole spectrum of norms and regulations regarding transactions, obligations, the conception and terms, the conclusion, amendment and cancellation of agreements, purchase and sale, the provision of payable services and Collision norms (the Civil Code of the Republic of Uzbekistan. IPS Norma).

Additionally, there is the Law, “On foreign economic activity” (the 26.05.2000 version). Its main tasks are as follows: to ensure the economic security, to protect the economic sovereignty and economic interests of the Republic of Uzbekistan in the field of foreign economic activity, to stimulate the development of the national economy and to create all conditions needed for integration of the Uzbek economy with the world economic system (Law of the Republic of Uzbekistan, “On foreign economic activity” as of June 14, 1991, No 285-XII. Art. 1. IPS Norma).

It should be added to the aforesaid information that the requirements imposed on international agreements (contracts) concluded by residents of the Republic of Uzbekistan are specified in the Laws of the Republic of Uzbekistan, “On the contractual-legal base of activity carried out by economic subjects” as of August 29, 1998; “On the procedure for registration of contracts (agreements) and treaties with the customs authorities of the Republic of Uzbekistan” (registered with the Ministry of Justice of the Republic of Uzbekistan No 832 as of 15 October, 1999); Regulations “On the procedure for registration and control over the implementation of exports and barter contracts by authorized banks” (registered with the Ministry of Justice of the Republic of Uzbekistan No 954 as of 9 August, 2000); Regulations “On the procedure for customs registration of goods exported by economic subjects of the Republic of Uzbekistan via the trading houses, representative offices and enterprises set up by them in foreign countries, as well as via the trading-investment houses of the Chamber and Commerce and Industry of the Republic of Uzbekistan in foreign countries” (Annex to the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No 189 as of 9 August 2005 and others). (Normative-legal documents. Entrepreneurship. Foreign economic activity. Exports-imports. IPS Norma).

International treaties as the source of international trade law encompass a large amount of documents of both the general character (within the framework of international groups of states) and the universal character.

In the CIS, for example, multilateral and bilateral agreements concluded by its member states form a legal framework for their foreign economic activity (the 1992 Tashkent Agreement on Cooperation in the Field of Foreign Economic Activity). (List of multilateral agreements signed by the Republic of Uzbekistan with the CIS member states for the supply of goods between organizations of the CIS members states etc.). (IPS Norma).

The 1994 Inter-American Convention on the right applied to international contracts, which contains the unified collision-legal norms that are effective in the field of international commercial law, is also a document of the regional character (Mexico, 17 March 1994). -pravo-v-mezhdunarodnom-oborote/2510-mezhamerikanskaja-konventsija-o-prave-primenimom-k-mezhdunarodnym-kontraktam), as well as the normative documents applicable in the EU.

Works are carried out on the harmonization and unification of law, as well as on the creation of uniform law in the EU, designed to generalize classic international agreements (conventions), statements etc. passed by EU authorities, which, in turn, are divided in 3 types: regulations, directives and decisions. (European Union Law.

The 1980 Vienne UN Convention on International Commodity Purchase-and-Sale Agreements proves a major document of the universal character in the field of international trade law. This document has been developed by UNCITRAL (the UN Convention on International Purchase and Sale of Goods (Vienne 1980) (KMKPT)

The Convention is the outcome of unification of material-legal norms, regulating commercial deals. Such unification is of the really universal character (See the address above).

It should be pointed out that an overwhelming majority of the Convention’s norms are of dispositive nature, meaning that it is possible to deviate from their content by mutual consent of the parties to a concrete international commercial contract.

The Convention solves a number of issues of principal importance in the field of international trade turnover. These include:

A legal conception of an international commodity purchase-and-sale agreement (an international commercial contract);

A procedure for concluding such contracts between absent parties;

A form of contract;

The main content of rights and obligations of the Seller and the Buyer;

Responsibility of the parties for non-fulfillment or improper fulfillment of contracts (See the same address).

As well as that, a series of norms worked out in international trade practice serve as a basis, on which the following things have been developed: model contracts, general terms of deals and regulations on the conclusion of contracts (agreements).

A contract’s record sheet contains a text of an agreement, where certain sections are filled in; and the agreement comes in force after the filled-in record sheet is signed. (Foreign Economic Activity. http://www/

The model contracts are worked out by large participants of international trade turnover – professional associations of subjects of international trade or international organizations such as the UN European Economic Commission.

Model contracts on grain sales – 1957, 1958, 1961;

General terms of investment commodity exports – 1955, 1957;

General terms of purchase and sale for imports and exports of consumer goods with a long period of use – 1962;

Recommendations on the conclusion of contracts for the most complicated types of deals: 1969 – for know-how in the field of mechanical engineering; 1973 – for the construction of large-scale industrial facilities; 1974 – for the conclusion of international agreements of industrial co-operation.

Apart from the national legislation and international agreements, the sources of international trade law also include international customs. The INCOTERMS rules represent one of the most prevalent international trade customs in the field of foreign economic activity. This document comprises the International Commerce Terms for unified interpretation of trade customs and terms, which exist and are widely used in international trade. However, the fixation of the International Commerce Terms in written form doesn’t signify their fixation in the juridical sense, since the International Commerce Terms, as an international non-governmental organization, is not entitled to codify legal norms.

The INCOTERMS rules regulate a so-called delivery base, i.e. the distribution between the Seller and the Buyer of expenditure and other obligations associated with the transportation, insurance and risk-taking in the case of accidental destruction of goods in the course of transportation. The given rules are used in cases where the parties refer to the application of one of the INCOTERMS terms in their contract. (The new INCOTERMS 2010 rules

In addition, the following rules have been worked out within the framework of the International Trade Rules: the Renewed Rules and Customs of Documentary Letters of Credit, the Uniform Rules on Contractual Obligations, the International Code of Advertising and others.

In Uzbekistan, the INCOTERMS Rules are viewed as an unofficial codification, which do not enjoy the force of law of their own (only those provisions of a contract that refer to INCOTERMS Rules are considered to be legally significant).

One can observe in conclusion that the sources of international trade law are numerous and supplemented by new normative documents on a continued basis.

(Source: “Business” newspaper)