American-Uzbekistan Chamber of Commerce
SPECIAL NEWSLETTER:
  
Uzbek Government on Sale of State-Owned Facilities to Small Businesses and Private Entrepreneurs and Further Optimization of Unused Territory and Redundant Production Areas
 
Issue Date: September 10, 2014
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2014 Opens a New Era for the Chamber
  

Since 1993 the American-Uzbekistan Chamber of Commerce has been at the forefront of advancing trade and business relations between the US and the Republic of Uzbekistan. AUCC prides itself in catering to the needs of our members, providing them with a platform to interact with policy makers in the US and the Republic of Uzbekistan and ensuring that bilateral commercial relations continue to be on the governments' top agenda.   

 

For the last twenty years AUCC has been a vigorous advocate of the views of the business community to ensure that private sector positions are considered during the development of policies that impact American businesses and the future of U.S.-Uzbekistan relations.  While 2013 concluded our celebrations for the 20th anniversary it also opened a new era for the chamber and our members.

 

We are delighted that today AUCC continues to be a well-known organization that is recognized for its strength and ability to work closely with a great number of partner organizations. AUCC enjoys excellent working relations with the Embassy of the Republic of Uzbekistan in Washington, D.C., the Government of the Republic of Uzbekistan, Uzbek ministries, associations and organizations as well as the executive and legislative branches of the U.S. AUCC also coordinates its efforts with a great number of international financial institutions, business councils and other professional organizations.

 

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Established in 1993, the American-Uzbekistan Chamber of Commerce (AUCC) is a private, non-profit trade association representing interests of U.S. businesses ranging in size from small private enterprises to large, multinational corporations conducting business in Uzbekistan.

Our Mission: To advocate the views of the business community to ensure that private sector positions are considered during the development of key policies that impact American businesses and the future of U.S.-Uzbekistan relations.

Our Objective: To serve the needs of its members by strengthening commercial relations between the United States and Uzbekistan.

Uzbek Embassy  

 

DECREE BY 

PRESIDENT OF THE REPUBLIC OF UZBEKISTAN 

 

No. PP-2200 dated July 03, 2014 

 

With the aim to provide efficient and effective use of the state-owned property, sales of the unused and unfinished by construction state-owned facilities, released land lots to the small business and private entrepreneurship entities for arrangement of production of modern competitive goods and render of various kinds of services, creation of new job-places and providing rise of the income of population [sic].

1. To draw attention of the heads of the State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition, Ministry of Public Health, Ministry of Popular Schooling, Ministry of Culture and Sport Affairs of the Republic of Uzbekistan, their territorial divisions, Counsel of Ministers of the Republic of Karakalpakstan, Regional, Cities and Districts' Hokimiyats to their unsatisfactory work and irresponsible approach in providing safety, proper current maintenance of buildings and installations, other state-owned facilities being in their balance sheets.    

It shall be noted that for the committed violations of the law at spheres of privatization and state property management the number of heads of territorial bodies of the State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition were dismissed, towards more than one hundred heads of state organizations having the state-owned property in their balance sheets the strict messures of criminal and administrative responsibility were taken. 

2. It shall be taken into consideration that the State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition, Ministry of Economy, Ministry of Finance, concerned ministres of the Republic of Uzbekistan, Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and City of Tashkent performed the entire inventory of the state-owned facilities upon the results of which the Lists of unused buildings and facilities unfinished by construction were determined.     

3. The followings shall be approved:

the List of unused and unfinished by construction state-owned facilities being subject to demolition, as per the Appendix No 1;

the List of unused state-owned facilities being subject to sale through public sales during the year of 2014,  as per the Appendix No 2;

the List of unused state-owned facilities, icluding those unfinished by construction, being subject to sale during the year of 2014 on the competitive basis at "zero" purchase price with the terms of undertaking the investment obligations and commitment to create the new job-places, as per the Appendix No 3;

the List of the land lots on which the creation of the small industrial zones is specified, with consequent allocation of areas at sizes of 0,2-0,3 hectares   to the private entrepreneurship entities for organizing in them the new industries, facilities of the services' sphere, as per the Appendix No 4;

the List of state-owned facilities subject to contribution into the Charter Funds of the economic entities as well as handed over to other organizations for operational management and gratuitous usage with the aim of their further effective utilization, as per the Appendix No 5.

4. The State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition together with the ministries, institutions, stockholder companies, associations, Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and City of Tashkent shall, within a ten days' period, get approved the time-tables on performance of:

demolition of the state-owned facilities indicated at the Appendix No 1 and transfer of the released land lots into the reseve funds of the local governing bodies;

valuation and putting on public sales of the unused state-owned facilities and the entrprises included into the Appendix No 2;

competitions for state-owned facilities' sales at "zero" purchase price with the terms of undertaking the investment obligations and commitment to create new job-places, as per the Appendix No3

Personal responsibility shall be placed upon the heads of the Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and City of Tashkent, the State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition for providing the in-time demolition and putting on sale of the state-owned facilities included into the Appendixes Nos 1,2 and 3.

5. Ministries, institutions, stockholder companies, associations, the Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and City of Tashkent, organizations and enterprises with presence of the state-owned property in their balance sheets shall:

within a two months' period provide preparation of the cadastral documents for the land lots, buildings and installations, as well as the state registration of the ownership rights related to the state-owned facilities indicated at the Appendixes Nos 2 and 3;

within a one month period the state-owned facilities indicated at the Appendix No 5 shall be transferred by their residual book cost to the according bodies of state and economic management, local state governing bodies with placement of responsibility upon them for performance of necessary recovery works and providing their further effective use.

Heads of the ministries, institutions, stockholder companies, associations, the Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and City of Tashkent, organizations and enterprises with presence of the state-owned property in their balance sheets, shall be strictly warned of their personal responsibility for safety and current maintenance of the state-owned facilities indicated at the Appendixes Nos 2,3 and 5 until their transfer to a new owner.

5. The Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and City of Tashkent:

together with the Ministry of Economy, the State Committee of the Republic of Uzbekistan for Architecture and Construction within a one month period shall present to the Cabinet of Ministers of the Republic of Uzbekistan proposals on further use of the land lots which got released as a result of the demolition of the state-owned facilities indicated at the Appendix No 1;  

together with the Ministry of Economy, the State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition,  the State Committee of the Republic of Uzbekistan for Land and Cadastre and the State Committee of the Republic of Uzbekistan for Architecture and Construction within a two months period shall elaborate the projects on placement of the private entrepreneurship entities within the small industrial zones to be organized on basis of the land lots indicated at the Appendix No 4, including creation of all necessary engineering services and infrastructure;

related to elaborated projects on placement of the private entrepreneurship entities within the small industrial zones, competitions on hand-over to the private entrepreneurship entities of the land lots at medium size of 0,2-0,3 hectares with the terms of undertaking the investment obligations on creation of the new job-places shall be arranged and held.

The State Joint Stock Company "UzbekEnergo", JSC "UzTransGaz", the Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and City of Tashkent shall provide, at the expense of their own funds, the construction of necessary engineering services and infrastructure in accordance with the elaborated projects on placement of the private entrepreneurship entities within the small industrial zones.

The Ministry of Economy, the State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition,  the State Committee of the Republic of Uzbekistan for Architecture and Construction, the State Committee of the Republic of Uzbekistan for Land and Cadastre, Ministry of Finance and Ministry of Justice of the Republic of Uzbekistan shall, within a two months' period, elaborate and get approved the Regulations on order of creation and arrangement of activities of the small industrial zones.

7. It shall be established that legalization procedures of the cadastre documentation on the state-owned facilities belonging to budget organizations and being subject to sale to the small business and private entrepreneurship entities based on decisions of President of the |Republic of Uzbekistan and the Cabinet of Ministers of the Republic of Uzbekistan, shall be performed at the expence of the budget of the Republic of Karakalpakstan and the according local budgets.

8. The period of sale of the state-owned assets indicated at the Resolution by President of the Republic of Uzbekistan dated April 25, 2012 No PP-1743 "On the Program of privatization of the state-owned property for the years of 2012-2013" shall be prolonged till the end of the year of 2015. 

9. Starting from June 1, 2014 the additional norms and measures aimed at simplification of the order of privatization of the state-owned facilities shall be applied as per the Appendix No 6.

10. Paragraph 3 of the Resolution by President of the Republic of Uzbekistan dated July 20, 2007 No PP-672 "On measures aimed at further deepening of privatization processes and active attraction of the foreign ivestments during the period of 2007-2010" shall be recognized as being void.

The State Committee of the Republic of Uzbekistan for Privatization, Demonopolization and Development of Competition together with the Ministry of Justice and other ministries and institutions concerned shall, within a one month period, present to the Cabinet of Ministers of the Republic of Uzbekistan the proposals on amendments and addenda into the legislation arising from the present Resolution.

11. The Prime Minister of the Republic of Uzbekistan Mr. Mirziyoyev Sh. M. shall be charged with the task of control over implementation of the present Resolution.


 

President of the Republic of Uzbekistan                                      

I. Karimov

Uzbek Embassy   

 

RESOLUTION BY THE 

CABINET OF MINISTERS OF THE

REPUBLIC OF UZBEKISTAN 

 

No. 192 dated July 15, 2014 

 

Appendix No 1. List of redundant production areas of the State Unitary Enterprises subject to sale, including those with the term of creation on their basis of the production facilities having good prospects   

Appendix No 2. List of redundunt production areas of the organizations with presence of State-owned shares in their Charter Funds subject to sale, including those under the term of creation on their basis of the production facilities having good prospects upon decisions by their according governance bodies.

Appendix No 3. List of facilities including those of social and production infrastructure subject to tranfer to the local State power bodies under their operational governance or into the Charter Funds of the according organizations

Appendix No 4. List of facilities of social infrastructure subject to sale

Appendix No 5. List of unused territories and redundunt production areas subject to transfer to the local State power bodies under their operational governance, including those intended for futher organization of the industrial parks

With the aim to reduce radically the unused territories, redundant production buildings and facilities (further referred to as "production areas"), social facilities and facilities of unprofitable, economically unsustainable and  low-profit organizations, the Cabinet of Ministers RESOLVES [sic]:

1. To agree with the proposal of the Work Commission for optimization of territories, production areas and infrastructure facilities of unprofitable, economically unsustainable and  low-profit enterprises, Ministry of Economy, Ministry of Finance, State Competition Committee, Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and city of Tashkent on sale, in the established order, of the reduntant production areas, including those with the term of creation on their basis of the production facilities having good prospects, belonging to:

State Unitary Enterprises as per the List of the Appendix No 1;

organizations with presence of State-owned shares in their Charter Funds, upon decisions by their according governance bodies, as per the List of the Appendix No 2;

It shall be established that all obsolescent and physically depreciated equipment present in a territory subject to optimization of the abovementioned organizations, shall be subject to utilization and the scrap metal made up as a result of utilization - shall be subject to hand-over in form of the scrap of ferrous and nonferrous metals by contractual prices accordingly to OJSC "UzMetCombinat" and OJSC "Tashkent plant for processing scrap of ferrous and nonferrous metals", all that to be done in the established order.

2. State Competition Committee of the Republic of Uzbekistan together with the State and Economic Governance Bodies, Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and city of Tashkent shall, within a two-weeks' period, get approved the time-tables for performance of valuation and putting onto the public sales of the redundant production areas of enterprises and organizations included into the Appendixes Nos 1 and 2 attached to the present Resolution.

3. It sall be established that, by way of exception, cash income received as a result of sale of redundant production area shall be accumulated in a special bank account of enterprises and organizations at their servicing banks and be used targetedly for modernization and technical re-equipment of production process as well as payback of debts on salary, before the state budget, bank loans and communal payments related to facilities of:

State Unitary Enterprises indicated at the Appendix No 1 to the present Resolution with exclusion of a part of amounts to be remained, according to legislation, at the disposal of the State Competition Committee;

organizations with presence of State-owned shares in their Charter Funds indicated at the Appendix No 2 to the present Resolution.

4. The following Lists shall be approved:

of facilities including those of social and production infrastructure subject to tranfer to the local State power bodies under their operational governance or into the Charter Funds of the according organizations as per the Appendix No 3;

of facilities of social infrastructure subject to sale as per the Appendix No 4;

of unused territories and redundunt production areas subject to transfer to the local State power bodies accordingly into their land reserves and under their operational governance, including those intended for futher organization of the smal industrial zones as per the Appendix No 5

5. Asset-holders of facilities, including those holding the assets of social and production infrastructure indicated at the Appendix No 3 to the present Resolution, shall hand-over and, the local State-power bodies and the according organizations shall, within a one-month period, accept the given facilities with providing perfomance of all necessary recovery works and their further efficient usage.

It shall be determined that the cost of facilities subject to transfer, indicated at the Appendix No3 to the present Resolution, shall not be subject to taxation at charging of the Value Added and Income Taxes.  

6. The Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and city of Tashkent shall:

within a one-month period provide acception of the unused territories and redundant production areas indicated at the Appendix No 5 to the present Resolution, as well as creation on their basis of the small industrial zones;

together with  the State Committee of the Republic of Uzbekistan for Architecture and Construction and the State Committee of the Republic of Uzbekistan for Land and Cadastre, within a two-months' period, with the involvement of project-elaboration organizations, at the expense of the local budget means, elaborate and get approved the according design estimates (construction documents) for the small industrial zones at the land lots (divided at the average by 0,2-0,3 hectares area), indicated at the Appendix No 5 to the present Resolution, foreseeng construction of necessary external, outside the production areas, pipelines and utility networks and organization of the appropriate infrastructure, with observance of architectural (town planning), sanitary, fire-sfety, nature-conservation requirements;   

within a three-months' period in accordance with the approved design estimates (construction documents) for the small industrial zones, arrange conduct of competitions on allocation to enterpreunership entities of the land lots at the average of 0,2-0,3 hectares area, as well as transfer on privileged terms on lease of the accepted production areas located in the territories of the small production zones;

perform, in the established order, the in-time an full-scale financing of the project and construction-insallation works related to the facilities of external infrastructure intended for newly-created small production zones. 

7. It shall be determined that the State-owned production areas located in the territories of the small production zones shall be let on lease to enterpreunership entities for a period up to 10 years on condition of undertaking by them of the investment obligations and commitment to create the new job-places with a possibility to prolong the lease period in case of the in-time and complete fulfillment of the commitments stipulated by previously concluded lease agreements.     

8. State Competition Committee of the Republic of Uzbekistan together with the Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and city of Tashkent, the State Committee of the Republic of Uzbekistan for Architecture and Construction and the State Committee of the Republic of Uzbekistan for Land and Cadastre, conserned ministries, institutions and economic governance entities,  shall provide the tough monitoring over implementation of the present Resolution and report about it to the Cabinet of Mnisters by the date of December 15, 2014.

9. Complexes of the Cabinet of Mniisters, the Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and city of Tashkent, State Competition Committee of the Republic of Uzbekistan, State Committee of the Republic of Uzbekistan for Architecture and Construction and the State Committee of the Republic of Uzbekistan for Land and Cadastre, together with the conserned ministries, institutions and economic governance entities  shall, by the date of December 1, 2014 perform the entire inventarization of unused territories, redundant production areas and infrastructure facilities of State Uniatry Enterprises and organizations with presence of a State-owned share at their Charter Funds as well as State-owned social infrustructure facilities handed over for gratuitous usage to the economic entities.

Upon the results of the perfomed inventarization the proposals on their further efficient usage shall be presented to the Cabinet of Ministers by the date of December 15 2014.

10. National TV-Radio Company of Uzbekistan together with the State Competition Committee of the Republic of Uzbekistan, Counsel of Ministers of the Republic of Karakalpakstan, Hokimiyats of Regions and city of Tashkent shall provide the extensive media coverage and elucidation of the essence and contents of the present Resolution in way of arrangement of cycles of TV and radio broadcasts and periodic display of advertising reels.

11. State Competition Committee of the Republic of Uzbekistan together with the ministries and institutions concerned, within a one-month period, shall present to the Cabinet of Ministers the proposals on amendments and addenda into the legislation, arising from the present Resolution.

12. The First Deputy Prime Minister Mr. Rustam S. Azimov shall be charged with the task of control over implementation of the present Resolution

 

Prime Minister 

of the Republic of Uzbekistan                                                    

Shavkat M. Mirziyoyev


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