Setting up a company in Uzbekistan

Before opening a company in the Republic of Uzbekistan, it is important to take care of some key details related to registration, and post-registration issues.

Regulatory acts governing the establishment and operation of the Limited liability companies, its Branches and Representative offices.

Limited Liability Company (LLC)

CCU;

The Law of the Republic of Uzbekistan “On Limited Liability Companies and Additional Liability Companies” (hereinafter – “Company Law”) [ https://lex.uz/docs/18793];

Decree of the Cabinet of Ministry of the Republic of Uzbekistan “On measures to implement the Decree of the President of the Republic of Uzbekistan No. pp-2646 of October 28, 2016 “On improvement of the state registration system and registration of business entities [https://lex.uz/docs/3111342];

General Provisions
Limited Liability Company is a legal entity.

The Participant (Founder) of a limited liability entity (Company) shall not be liable for the obligations of the Company and shall bear risk of losses associated with the Company’s activities to the extent of the value of its contribution to the charter capital of the Company.

The Participant has the right to:

• participate in the management of the Company in the manner as provided in a Charter of the Company and the applicable laws of Uzbekistan.
• receive dividends resulting from operations of the Company.
• obtain in case of liquidation of the Company a part of its property remaining after settlement of accounts with creditors, in cash or in kind and etc.
• The Company shall have the right on its own behalf to make any transactions, acquire, use and dispose of any movable and/or immovable property, as well as intellectual property rights, acquire any property and personal non- property rights, act as a plaintiff or defendant before any court or arbitral tribunal within and outside the territory of Uzbekistan.

Management bodies:

• The Participant – the supreme management body (Supreme Body) of the Company.
• The Director – the executive body of the Company.

Accounting:

The accounting system and accounting procedures of the Company shall be established pursuant to the requirements of the laws of Uzbekistan.

The annual financial statements of the Company shall be subject to approval by the Supreme Body.

Needed documents/Time frame

Submission of the following documents to the (Ministry of Investment, Industry and Trade) for registration (if a founder is a legal entity):

• a document confirming that the founder is a legal entity under the laws of a foreign state (extract from the register of legal entities, the trade register or another document under the laws of a foreign state) ;
• a copy of the certificate of state registration of a legal entity (if available);
• copy of the by-laws;
• If a founder is a physical person: A copy of a Passport only.

NB! All documents must be appostiled (only notarized for CIS countries) as well as translated into Russian or Uzbek language with further notarization.

Charter, Foundation Agreement, Minutes of the General Meeting/Decision on establishment of the LLC.

The state registration is subject to a state registration fee: 1 basic estimate amount (340.000 UZS = 27-30 USD) - for registration of a company with the charter capital in the amount of less than 400 million UZS;

10 basic estimate amount (3.400.000 UZS = 270-300 USD) - for the registration of a company with the charter capital in the amount of more than 400 million UZS. *In this case, a foreign company can enjoy the relevant benefits established by the Law of the Republic of Uzbekistan “On Investments and Investment Activity” [ https://lex.uz/ru/docs/4664144]

In addition, a director or a founder of the LLC is a foreign individual, it is required to open a PINI (ПИНФЛ) (personal identification number of individual) and register it with the State Tax Inspectorate. For this purpose, according to paragraph 3 of the Decree of the Cabinet of Ministers "On measures to simplify the procedure for registration of foreign citizens and stateless persons in the Republic of Uzbekistan" № 593 of 28.09.2020 [https://lex.uz/ru/docs/5023876], a foreigner shall apply to the Migration and Citizenship Department of the internal affairs bodies or to the Center of State Services

Time: Up to three (3) working days from the date of submission.

Branch office

Only the Civil Code of the Republic of Uzbekistan (hereinafter – “CCU”) [https://lex.uz/docs/111181]

General Provisions

A branch is not a separate legal entity.

Branches are vested with property by the legal entity (parent company) that created them and act on the basis of regulations approved by it. A head of branches (director) shall be appointed by the legal entity and shall act on the basis of its power of attorney.

Rights and Obligations of the Branch:

On behalf of the parent branch has rights to:

• acquire, own and dispose of all kinds of property and property rights on behalf of the parent company. Open, maintain and utilize bank accounts in Uzbekistan.
• import and export goods and services for its own needs.
• enter into all types of commercial contracts, including financing arrangements, etc.

It is important to notice that any assets and liabilities of the branch are assets and liabilities of the parent company.

Regulations and Requirements

Management of a branch

A branch shall be managed pursuant to the decisions and directions of the parent company, which shall be taken pursuant to its own foundation documents and applicable legislation.

The day-to-day activities of a branch shall be carried out by the director of the branch appointed by the parent company.

The competence of the director to manage the branch, as well as limitations of such competence, shall be set out in the power of attorney issued to him by the parent company.

Needed documents/Time frame

Submission of the following documents to the (Ministry of Investment, Industry and Trade) for registration:

• A document confirming that the founder is a legal entity under the laws of a foreign state (extract from the register of legal entities, the trade register or another document under the laws of a foreign state);
• Сopy of the by-laws;
• Power of attorney issued by the parent company to the head/director of the branch;
• Regulation on the branch, approved by the parent company.

NB! All documents shall be appostiled (only notarized for CIS countries) as well as translated into Russian or Uzbek language with further notarization.

Time: Three (3) working days from the date of submission.

Representative office

CCU;

Decree of the Cabinet of Ministers of the Republic of Uzbekistan “On approval of the regulation on the procedure of accreditation and activities of representative offices of foreign commercial organizations in the territory of the Republic of Uzbekistan” [https://lex.uz/docs/382511].

Only the Civil Code of the Republic of Uzbekistan (hereinafter – “CCU”) https://lex.uz/docs/111181]

General Provisions

A representative office is not a separate legal entity. A representative office is a structural subdivision of a legal entity that is established at a different location from that of the legal entity carries on the representative activity of the parent company and protects its interests. Thus, the Representative office has no right to engage in any other industrial or commercial activities. 

The head/director of a representative office is appointed by an authorised body of the parent company and he acts under a power of attorney granted to him.

Regulations and Requirements

It is important to note that, as was mentioned above, representative offices cannot conduct commercial activities.

Consequently, licenses and permits cannot be issued neither to a branch nor to a representative office.

NB! If your purpose is to carry out licensed activity in Uzbekistan, a representative office or a branch cannot be considered as a right legal form of business for such purposes.

Needed documents/Time frame

• Submission of the following documents to the (Ministry of Investment, Industry and Trade) for accreditation:
• A document confirming that the founder is a legal entity under the laws of a foreign state (extract from the register of legal entities, the trade register or another document under the laws of a foreign state) ;
• Сopy of the by-laws;
• Power of attorney issued by the parent company to the head/director of the representative office;
• Regulation on the representative office, approved by the parent company;
• Letter of Guarantee issued by a legal entity or individual of the Republic of Uzbekistan, confirming a consent on providing a legal address for a representative office. Additionally it is required to submit the following information (free-form).

NB! All documents must be appostiled (only notarized for CIS countries) as well as translated into Russian or Uzbek language with further notarization.

Accreditation fee in UZS (national currency of the Republic of Uzbekistan) in the amount of 48 basic estimate amount (16 320 000 UZS = 1290-1300 USD).

NB! Note that representative offices shall be accredited every year, and, accordingly, pay the state fee every year.

Time: Up to (10) working days from the date of submission.

NB! All documents shall be appostiled as well as translated into Russian or Uzbek language with further notarization.

Action Plan 

Incorporation of LLC

Before registering a company in Uzbekistan please take care on the following key details:

1. Check if your business area requires you to get a business license, permit and/or approval;
2. Be aware that a limited liability partnership may not have as its sole member another business partnership consisting of one person;
3. Work permit and visa would be required for a foreign directors (employees) priory the day of appointment.

It is prohibit to appoint a foreign person to act as a director of a company without a work permit. Work permit shall be obtained on the basis of the invitation letter, issued by the employer (company). Work permit is valid for one year and shall be renewed upon its expire date.  

Step 1. Incorporation Process

Choose the right organisational business structure (Limited Liability Company, Branch, Representative Office).

Note! Limited Liability Company is the most popular business structure of a legal entity in Uzbekistan.

Step  2. Choose a company name

Be aware that in accordance with the legislation of Uzbekistan priory company incorporation  a chosen name shall be register (booked) on a state website. 

A name of a company shall not contain such as words as “Uzbekistan”, “UZ”, cities names “Tashkent”, “National”.

Step 3. Personal Identification Number (PINFL) obtaining for foreign director and founder

PINFL or PINI can be obtained: 

state authority in Uzbekistan (can be obtained based on the Power of Attorney).

Step 4. Application for incorporation

Incorporation (registration) shall take place no later than three (3) working days following the day on which the application is submitted.

Post-Registration Considerations

Adhering to legal compliance is paramount for any business. It helps you run your  business operations seamlessly. Below are a few activities to maintain compliance with  local laws. 

1. Tax compliance: Timely filing of tax returns and paying the correct amount of taxes as well as correct reporting income, expenses to the relevant tax authorities is crucial company to avoid legal consequences and fines.  
2. Legal Compliance: Proper documentation ensures your business complies with  all laws and regulations.

Professional Assistance and Support

Seeking professional assistance and support from a company registration consultant  offers several benefits. 

1. Expert guidance: The team comprises lawyers and accountants with extensive knowledge and expertise in business laws and accounting. They can help you  steer clear of the complexities of company registration, ensuring that all legal  compliances are met. 
2. Save time and effort: Setting up a company in Uzbekistan involves several  steps and documentation. Company registration consultant manages these  lengthy processes efficiently, saving your time, and effort and allowing you to  focus on your core activities. 
3. Error-free application: You may err while filling out the registration papers.
   However, the company registration consultant has a solid experience and can process the application without mistakes. 
4. Legal Compliance: A professional company registration consultant acknowledges the latest compliance and regulation updates. It ensures that your  business complies with all applicable laws. 

Esplora Legal, an international law firm, offers company registration services in Uzbekistan. Our team of experienced business consultants assists you with registering  your company in Uzbekistan and obtaining the required licenses and permits. In  addition, we also help you set up your bank accounts.As an internationally acclaimed law firm, Esplora Legal offers legal support and accounting services. 

In other words, Esplora Legal is your one-stop solution for setting up your business, accounting services, and legal support.

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