Enhancement of corporate relations in the Republic of Uzbekistan

On 7 February 2025, the Republic of Uzbekistan enacted Law No. ZRU-1025 “On Amendments and Additions to Certain Legislative Acts of the Republic of Uzbekistan for the Development of Corporate Relations” (the “Law”).

The Law aims to update corporate legislation, streamline the governance of business entities and enhance the protection of the rights of shareholders and members. It also introduces new categories of civil law relationships and removes obsolete forms of incorporation for legal entities.
Key amendments introduced by the Law:

• Legal status of new corporate concepts. The Law formalizes new corporate concepts by introducing regulations for corporate agreements, consortia and consortium agreements.
• Simplification of registration requirements for founding documents. The requirement for state registration of the memorandum of association of a limited liability company, as well as any amendments thereto, has been abolished.
• Enhanced transparency of supervisory board decisions. Business entities are now required to disclose decisions related to the issuance of shares, corporate bonds and other securities as material facts in accordance with applicable legislation.
• Strengthened oversight over the securities market. The designated regulatory authority is now required to publish information on state registration of securities offerings and the licensing of the relevant professional activities.
• Optimization of forms of incorporation. The legal forms of unitary enterprise and additional liability company have been abolished.
• Streamlined reorganization procedures for legal entities. In the case of mergers, acquisitions or changes in forms of incorporation, all rights and obligations are transferred to the newly established legal entity, regardless of whether they are specified in the transfer deed.

Corporate agreement: expanded opportunities for participants

A significant development introduced by the Law is corporate agreement, enabling participants in a business entity (shareholders of a joint-stock company or members of a limited liability company) to agree in advance on how they will exercise their rights and fulfill their obligations.

Under this agreement, participants may formalize the following obligations:

• Exercising or refraining from exercising (waiving) their shareholder/membership rights, such as voting at general meetings
• Coordinating actions related to corporate governance
• Establishing terms for the purchase and sale of shares/interests, such as a predetermined price or upon the occurrence of specific circumstances.

Furthermore, a corporate agreement may outline mechanisms to ensure the fulfillment of obligations and stipulate liability for non-compliance. The introduction of this legal instrument enhances the management of a business by making it more structured and predictable.

A corporate agreement must be executed in writing and is legally binding on the parties.

Consortia

One of the key changes brought about by the Law is the formalization of the consortium concept. This mechanism enables business entities to combine their resources, expertise and capabilities to undertake large-scale and complex projects. A consortium does not constitute a separate legal entity but is established through an agreement among its participants.

Companies entering into a consortium agreement retain their independence in business operations and may simultaneously participate in other consortia.

Regulation of limited liability companies

The Law also amends the regulation of limited liability companies (LLCs), providing greater clarity on:

• The procedure for making and documenting contributions to authorized capital
• Rules for state re-registration of a company upon the sale of a member’s equity interest
• Requirements for the size of the reserve fund and other aspects of corporate governance

These amendments are designed to simplify corporate procedures and enhance their transparency.

The Law will take effect three months after its official publication.

HOW BEONE CAN ASSIST

We would be pleased to offer our support in the following areas:

• Consulting services regarding the applicability of the new legislative provisions to your company or projects
• Assessing the impact of legislative changes on existing business structures, including taxation of both current and planned operations
• Reviewing and updating the company's tax policy in light of these legislative changes
• Preparing relevant inquiries to regulatory authorities regarding the application of new legal norms that may require clarification

We hope this information will be helpful to you. We would be happy to provide further detailed advice on these changes and address any questions you may have.