REFORMS IN UZBEKISTAN AChIEvEMENTSamcham.uz/wp-content/uploads/bc_26_internet.pdf · 2019. 7....

AnnuAl RepoRt foR MeMbeRs 2018

REFORMS IN UZBEKISTAN ChANgES ANd AChIEvEMENTS

Dear Amcham members and friends,

2018 has been a very busy year for all of us with tremen-dous changes. The govern-ment issued new reforms, al-most on a daily basis, and it was hard for us to keep with the pace they set.

Liberalisation of the visa re-gime, announcement of the new tax law, new foreign in-vestment law, the PPP law and many more initiatives have been taken to open up the country and attract more for-eign investments.

For AmCham it has also been a very busy year with many events taking place. We were very pleased to have so many prominent government officials speak at our month-ly meetings, sometimes twice a month. Our commit-tees have been very active as well and we are very hap-py with the new committee which has been set up the Intellectual Property Rights (IPR) Committee (headed by Mukhammadali Makhmudov of Legalmax) which organ-ised their first seminar during the Central Asian Investment Forum last October.

2019 will be the year of Active Investments and Social Development in Uzbekistan and we are looking forward to continue our dialogue with the government. The govern-ment and the EBRD are in the process of setting up a (for-eign) investors council and we hope that the AmCham can al-so play an important role in the council and voice the opinions of our members.

On behalf of the Board of Directors and the staff I here-by wish you all a very Healthy and Happy New Year !

Hugo W. Minderhoud President

Dear Members and Friends,

As we enter the New Year, the pace of change in Uzbekistan continues unabated with everyone taking note—of the regular, if not daily, improvements to our busi-ness and personal lives. Tashkent has become a hub of activity as President Mirziyoyev and his administration move with determination to make up for lost time—and the early results have been well received and welcomed by the business community.

In this issue of Business Connections we feature the Changes and Achievements taking place in those sectors where many of us are engaged—hospitality, food process-ing, financial & legal services, engineering, manufacturing, trade & distribution, tourism, and technology be it renew-able energy or high-tech.

As private business people we support the changes and look forward to those further measures sure to come in the year ahead.

The Editorial Board

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AMCHAM UZBEKISTANAMCHAM UZBEKISTAN

ChAnges And AChieveMents WhAt A diffeRenCe tWo YeAR’s MAkes

What a difference two years can make. This article will touch-upon many of the changes that have occurred since President Mirziyoyev took office in December 2016. We will reflect on both the change itself as well as the impact it has had on the various sectors and components of the Uzbek economy. In selecting those changes of note, we have separated them into group-ings such as those that affected or impacted the gen-eral population; those that transformed selected areas of the economy; those that changed the way foreign-ers view Uzbekistan; those that have modified and influ-ence geopolitical behavior; and those that while most welcome, have yet to show their true results or achieve-ments.

The past two years have shown a government that is busy and hard at work. New measures and decrees are forthcoming regularly, if not daily. Cities and roadways are being transformed, public transportation is a cen-

tral theme with such critical things as pedestrian traffic and safety being looked after from on high. News and the dissemination of information is now readily avail-able as it seems the curtains have been opened and there is light. Transparency, openness and the ability to express an opinion are encouraged as the Government takes a strong hand in dealing with corruption and those who abuse the public trust.

While well introduced to central government thanks to his tenure as prime minister, President Shukhrat Mirziyoyev started his administration in high gear by setting out new and highly ambitious objectives. He has not disappointed, in that it would be difficult to find any sector or area of the Uzbek economy that has not been impacted by what has happened or is in progress. The same applies to the general population. Rich or poor; young or old, resident or visitor, urban or rural, everyone has experienced and/or felt the changes taking place.

Business ConneCtions • AnnuAl RepoRt foR MeMBeRs 20182

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uzbekistan is now on very positive terms with its major trading partners—China, Russia, korea, the european

union and the united states

Small changes can also make a big change in our lives. Improved traffic patterns, increased availabili-ty of ATMs and improved access to the internet being just three of the more notable changes we have seen and experienced. For those of us in the internation-al community, some of the more meaningful changes have been those dealing with visas, work permits, and the ease of arriving and departing via the Islam Karimov International Airport. In the business community, the most signif icant change has been the opening and availability of currency conversion. While the devalua-tion was painful to many, the fact that businesses can now readily convert Uzbek Soum into hard currency and transfer the proceeds abroad is of major impor-tance and the results can a l re a d y b e s e e n i n t h e growing number of foreign investors looking to invest and do business in and with Uzbekistan.

On the geopolitical front, President Mirziyoyev has been fully engaged and a whirlwind of activity. State vis-its to the neighboring republics, travel and further state visits to Europe and the United States where he met with President Trump in the White House. Meetings with heads-of-state, participation in important meetings in-cluding the United Nations and other major forums, all in addition to the many tasks being carried out by his senior ministers and advisors.

From a time, not far past, when Uzbekistan’s relations with its neighbors ranged from lukewarm to cold, relations are now warm and collaborative with regional cooperation a central theme. Moving further afield from Central Asia it-self, Uzbekistan is now on very positive terms with its ma-jor trading partners—China, Russia, Korea, the European Union and the United States. Positive relations also prevail with the sub-continent—India, Pakistan and Bangladesh, as well as with Turkey, Israel and Iran.

Visitors ranging from President Putin of Russia to U. S. Secretary of Commerce Wilbur Ross are just two of the many important people who have come to see

the New Uzbekistan. The return of the European Bank for Reconstruction and Development (EBRD) is also most welcome, as are the stronger ties with

the European Community and the combined forces of the World Bank and Asian Development Bank. Not to be overlooked is Uzbekistan’s role in the Shanghai Cooperation Organization, where Uzbekistan occupies the General Directorship.

In the corporate/financial world there are many chang-es either announced or in the process of implementa-tion. The most important include: (i) the new Tax Code; (ii) Revised Customs Rules, Regulations and Procedures; (iii) protection of Intellectual Property Rights; (iv) adher-ence to the Rule of Law and respect for individual prop-


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two areas that need to be addressed are the privati-zation of select state- owned entities ( soes) and the

gradu al reduction of the soes in the overall economy

erty rights; and (v) a concerted effort to reduce and elim-inate corruption at all levels of government.

For small businesses and individual entrepreneurs there are major changes taking place, all designed to fa-cilitate hiring and staffing, registration and reporting , while reducing related costs. This will be especially important to the so called “gray economy”, the size of which may be the equal of the official economy, in that all such activities will gradually see the benefits of moving out of the shadows to the official economy—where the costs and bureaucrat-ic procedures are no longer an impediment.

On a macro—all encompassing level, the Government has taken steps to satisfy the child labor concerns of the International Labor O r g a n i z a t i o n ( I LO) s o that garments and other cotton goods made with Uzbek cotton can now be sold freely in Europe and North America. The same applies to regional water is-sues and political boundaries and borders, where pos-itive steps have been taken to defuse tension and pro-mote collaborative solutions.

Equally encouraging has been the new administra-tion’s interest in reforming the educational system with positive changes in progress along with the opening of new private schools and colleges. Language schools and computer program training centers are now in favor as are private healthcare practices and dental clinics.

Two areas that President Mirziyoyev has highlight-ed on several occasions that need to be addressed are: the privatization of select state-owned entities (SOEs); and the gradual reduction of the SOEs in the overall economy. Steps are being taken as in the case of SOEs such as Almalyk, the Bekabad Metallurgical Plant, and the Dori-Darmon Pharmaceutical Complex, but more nee ds to be done in a t imely and trans-parent manner. Same for the financial sector where the St ate’s ownership and involvement should be reduced, and new institutions created to promote and develop the capital market and Tashkent Stock

E x c h a n g e . T h e r e i s a l -so discus sion of a split-t i n g - u p of H avo Yu l l a r i Uzbekistan Airl ines, the national carrier, so that t h e p a s s e n g e r a n d c a r-

go services are no longer part of the administration that also runs the country’s airports and other unre-lated activities.

To summarize, there have been tremendous changes and achievements these past two years and President Mirziyoyev and his team are to be congratulated for their commitment and hard work. We close by wish-ing the President and his team continued success as they forge ahead, and we commit—as AmCham—to pro-vide our total support and assistance in helping them achieve the most honorable results. O

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exhibitions in uzbekistAn 2018–2019

www.afs-research.com

Date Exhibition Organizers Venue

27/02–01/03 UzBuild—2019 UzBuild Tashkent Uzexpocentre

27/02–01/03 AquaTherm Tashkent 2019 AquaTherm Tashkent Uzexpocentre

27.02–01.03 BuildTech 2019 BuildTech Tashkent Uzexpocentre

13–15/03 AgroWorld Uzbekistan 2019 AgroWorld Uzbekistan Uzexpocentre

27–29.03 UzMetalMashExpo 2019 IEG Uzbekistan Uzexpocentre

27–29.03 UzSecureExpo 2019 IEG Uzbekistan Uzexpocentre

27–29.03 UzChemPlastExpo 2019 IEG Uzbekistan Uzexpocentre

03–05.04 UzFood Uzbekistan 2019 WorldFood Uzbekistan Uzexpocentre

16–18.04 Health care-TIHE 2019 TIHE Uzbekistan Uzexpocentre

16–18.04 Stomatology Uzbekistan 2019 I. T. E. Exhibitions & Conferences Ltd Uzexpocentre

16–18.04 AptekaExpo Uzbekistan 2019 ITE Uzbekistan Uzexpocentre

24–26.04 MebelExpo Uzbekistan 2019 MebelExpo Uzbekistan Uzexpocentre

24–26.04 Expo-Russia Uzbekistan 2019 OAO Zarubej-Expo Uzexpocentre

02.05–04.02 BeautyExpo Uzbekistan 2019 EXPO POSITION Uzexpocentre

15–17.05 Power Uzbekistan 2019 ITE Uzbekistan Uzexpocentre

15–17.05 OGU 2019 ITE EurAsian Uzexpocentre

24–26.05 Silk and spices 2019 NK «Uzbektourism» Uzexpocentre

10–12.05 Agrotech Expo 2019 Agriculture ministry Uzexpocentre

19–21.05 KinderExpo Uzbekistan 2019 EXPO POSITION Uzexpocentre

11–13.09 UzTextile Expo 2019 ITECA Uzexpocentre

25–27.09 UzMedExpo 2019 ITE Uzbekistan Uzexpocentre

25.09–27.09 Plastex Uzbekistan 2019 ITECA Uzexpocentre

25–27.09 Chemie Uzbekistan 2019 ITECA Uzexpocentre

25–27.09 GETCA 2019 ITECA Uzexpocentre


exhibition in the usA

Exhibition Venue Subject Date

CES Las Vegas International exibition of household electronic appliances 08–11.01

IBS 2019—Builders’ Show Orlando International building exhibition 09–11.01

AHR Expo 2019 Atlanta Atlanta International exhibition of cooling/heating equipment and air-condi-tioners

14–16.01

Baltimore Remodeling Expo Baltimore International building and remodeling exhibition 18–20.01

IBS 2019—Builders’ Show Las Vegas International building exhibition 19–21.01

World of Concrete Las Vegas International exhibition of equipment and technologies for concrete manufacture

21–25.01

TISE Surfaces Las Vegas International exhibition of flooring materials 23–25.01

Franchise Expo South Miami International franchise exhibition 24–26.01

IPPE Atlanta International exhibition of food industry technologies 12–14.02

Exhibitor Live Las Vegas International exhibition for experts in arranging fairs and corporate events

24–27.02

The International Restaurant & Foodservice Show New York

New York International restaurant and foodservice exhibition 03–05.03

Vinexpo New York New York International exhibition of wines 04–05.03

Plastics Recycling New Orleans International exibition and workshop on plastics recycling 11–13.03

BDwest Los Angeles Exhibition of design in hospitality industry 13–14.03

IDEA Miami International exhibition of technical textiles and nonwoven fabrics in the USA

25–28.03

ProFood Tech Chicago International exhibition of foodstuffs’ and drinks’ processing tech-nologies

26–28.03

Industrial Pack Atlanta International exhibition of industrial packaging 27–28.03

InterPhEx New York International exhibition of pharmaceutical industry 02–04.04

BuildingsNY New York Specialized building exhibition 02–03.04

Automate Chicago International exibition of industrial automation 08–11.04

ProMat Chicago International exhibition of cargos’ transshipment and storage 08–11.04

Auto Show New York New York International auto show in New York 19–28.04

CastExpo & Metalcasting Congress

Atlanta International exhibition and congress on metal casting industry 27–30.04

Interwire Atlanta International exhibition of wires and cables 14–16.05

BioMedDevice Boston International exhibition of medical equipment and materials 15–16.05

NRA show Chicago International exhibition of hotel and restaurant business 18–21.05

BAR Chicago International exhibition of alcoholic beverages for restaurant business 18–21.05

Franchise Expo New York International franchise exhibition 30.05–01.06

ATX East New York Exhibition of technologies and systems for industrial automation 11–13.06

Clean Show Las Vegas Internationl congress and exhibition of laundries and cleaning systems 20–23.06

AWFS Las Vegas International exhibition of woodworking industry 17–20.07

All show dates are subject to change. Please visit each show’s website to confirm show dates prior to making travel plans.

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Ms. Cindy Malvicini is a Country Director of the Asian Development Bank’s Uzbekistan Resident Mission.

Ms. Malvicini leads ADB operations in Uzbekistan and supervises the development and implementation of the bank’s Country Operations Business Plan for 2019–2021 and the Country Partnership Strategy. The plan and stra-tegy aim to support the country’s long-term development needs through infrastructure investment, human capital and private sector development, and improved regional in-tegration and social inclusion.

Ms. Malvicini, a national of the United States, joined ADB in 2005 and has held numerous lead positions in op-erations and communications. From 2007 to 2014, she worked as a Water Resource Specialist in ADB’s South Asia Department, and until 2017, she served as Project Management Unit Head, where she managed policy dia-logue; designed and managed infrastructure projects in irri-gation, integrated water resources management, and flood management; and led climate change programming for several countries. She began her career at ADB as the Head of the Information and Disclosure Unit in the Department of External Relations (now called the Department of Communications).

Before joining ADB, Ms. Malvicini worked for the New York State Water Resources Institute from 1992–1995, fa-cilitating agreements between upstream watershed com-munities and New York City. She also worked for Cornell University’s administration as a Change Management Advisor from 1996–1999, and conducted research in the Philippines as part of the Conservation Farming for the Tropical Uplands Program from 1994–2003. Ms. Malvicini was a consultant with ADB from 2001–2005 working on core bank policies, such as ADB’s first Environment Policy, framework for ADB–Government–NGO cooperation, and the bank’s Public Communications Policy.

Ms. Malvicini graduated from Cornell University in New York in 2000 and Wheaton Graduate School in Illinois in 1988. She has master’s degrees in agriculture (water re-sources management) and intercultural studies.

Mr. Mukhammadali Makhmudov is a chair of AmCham Intellectual Property Rights Sub- Com mit tee since October 2018. Mr. Makhmudov is a Managing Partner of Legalmax since 2003 and has extensive experience with both nation-al, and foreign and transnational companies.

WelCoMe AboARd


Join AMChAM fAMilY

His practice covers areas such as intellectual property law, competition law and leading litigations in national and international arbitration courts.

He is a professional patent attorney whose services are marked by the international rankings “CHAMBERS GLOBAL” and “THE LEGAL 500”

For more than ten years, he has been advising leading companies in pharmaceutical and oil-and-gas sectors, food production and international catering networks and representing their interests of in the field of intellectual property protection.

In addition, he has provided legal support to a number of leading foreign companies present in the region, as well as current structures of the UN. He is also a legal expert in publications of the authoritative business publications in related projects.

The Tashkent International Clinic is pleased to welcome Doctor Jens Lüdders. Dr. Lüdders joins us from the French Hospital in Hanoi, Vietnam where he worked as an emergency physician. He received his medical degree and doctorate (MD) from the Johann Wolfgang Goethe University Medical School in Frankfurt in 1991.

Dr. Lüdders is a member of the Royal College of General Practitioners (MRCGP). Furthermore, he has a Diploma in Immediate Medical Care (DIMC) from the Royal College of Surgeons in Edinburgh. In 1998 he received a Masters in Public Health(MSc) from the London School of Hygiene and Tropical Medicine, London and more recently a post-graduate Diploma in Diabetes (PGDip) with distinction from the University of Leicester.

Dr Jens has extensive clinical experience in family and emergency medicine. He was a Family Physician in London, United Kingdom, has worked as a Chief Medical Officer in China, Algeria and Guinea. Furthermore, he was emergen-cy care doctor in Gibraltar and has worked in Zambia and Scotland, where he completed his rural and remote medi-

cine fellowship funded by the Scottish government. Dr. Jens speaks German, French and English.

Dr Jens is married to Hana, a Yoga and Pilates teacher, and they have two young children. They enjoy outdoor ac-tivities, music, current affairs and meeting and spending time with new friends.

Mr. Shadab Khan, Franchise Director—Uzbekistan, Taji ki-stan and Turkmenistan

As Franchise Director of Uzbekistan, Tajikistan and Turkmenistan, Shadab provides Franchise Leadership to our Bottlers and manages the Coca- Cola Company’s busi-ness in these markets and is the Head of the Representative Office for Coca-Cola in Tashkent, Uzbekistan. He has been based in Tashkent since November 2018. Shadab joined Coca-Cola India in 2007 as the Sr. Manager (Key Accounts) for India and Sri Lanka and has post that worked in various roles in Customer Management, Commercial Strategy and has been in General Management roles since 2012 first as the Country Manager for Nepal and Bhutan and then as Managing Director for Coca-Cola Bangladesh Ltd.

Shadab has actively represented Coca-Cola and has been involved in public-private platforms representing in-dustry issues across South Asia over the last 6 years and is proud to now represent Coca-Cola on the Board of AmCham Uzbekistan.

In 19+ years of his work experience Shadab has worked at start-ups and small firms and also in Multi-national com-panies across Telecom, Packaged Food and Non-Alcoholic Ready to drink Beverage sectors notably Unilever and now Coca-Cola.

Shadab holds a PGDM from T. A. Pai Management Institute, Manipal, India and has completed the Certificate Program in Strategic Retail Management from Indian School of Business, Hyderabad, India.

In his spare time Shadab enjoys traveling, listening to world music, trying new cuisines and photography. O

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AmCham in Uzbekistan joined with Legalmax Law Firm to present a seminar discussion on “Attracting Investment—The Case for Intellectual Property Rights”. The seminar was or-ganized in the framework of the Eighth Annual Central Asia Trade Forum that was co-hosted by the United States Agency for International Development (USAID) and the Ministry for Foreign Trade of Uzbekistan. Over 100 partic-ipants attended from private sector companies in Central Asia and govern-ment officials from the State Customs Committee, the Ministry of Trade, the Ministry of Innovations and the State Agency for Intellectual Property Rights Protection.

A m Cham H onorar y President Donald Nicholson II welcomed guests and was quoted as saying “the im-portance of the Intellectual Property Rights (IPR) issues is supported by

the fact that the biggest companies that currently operate globally, like Coca-Cola, Google, Tesla and oth-ers have reached their success due to investment in research and devel-opment, innovations, and technologi-cal advances. Be it the unique formu-la of Coca-Cola, conveniently modi-fied solar battery of Tesla, or unique software for Google. Therefore, the investments tend to go to the juris-dictions where the IPR are protected by the law and are duly implemented”.

This seminar is the first of the se-ries of seminars on IPR and featured speakers from the FMCG Industry of the Central Asia region. Speakers in-cluded Olga Voronova, the Central Asian Manager of Procter & Gamble, Sergey Levin, the Trademark Counsel of Eu r a s i a & Af r i c a , C o c a - C o l a and Pavel Salikhov, the Corporate Affairs Director of Mars & Wrigley

Confectionery CEAB and Turkey. The speakers shared that all three compa-nies face similar issues with their prod-ucts in Uzbekistan and Central Asia as a whole. They stated that the market is flooded with fake products and look-alike products from all three produc-ers. The volume of counterfeit prod-ucts exceeds 50% of the turnover in certain categories. Proctor & Gamble stated that this is the largest barrier in developing international brands and subsequently investing in Uzbekistan. The main concern however, is the health and safety of the consumers purchasing counterfeit products. In many cases, these fake products are produced in garages or mini-factories in different locations of Uzbekistan, Kyrgyzstan and areas of China. The is-sues of quality control and hygiene are non-existent in the making of these products.

“AttrActing investment—the cAse for intellectuAl pRopeRtY Rights” in the frAmework of centrAl AsiA tRAde foRuM

H. E. Alan D. Meltzer, Charge d’Affaires opening remarks.

Olga Voronova (Procter & Gamble), Mukhammadali Makhmudov (Legalmax), Sergey Levin ( the Coca-Cola company), Pavel Salikhov (Mars Corporation).


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According to Mars Corporation, there are approximately 30 mid-size manufacturers of Mars’ lookalike prod-ucts in Uzbekistan and 10 large manu-facturers. Each large manufacturer produces 1 ton of counterfeit prod-ucts per day. Packaging for these prod-ucts is ordered from China. The coun-terfeit products are sold to the con-sumers at 25% to 75% of the original

products’ price. The distribution chan-nels arrange export to Kazakhstan, Kyrgyzstan and Tajikistan.

Participants discussed adminis-trative, procedural, regulatory, leg-islative and institutional measures that must be addressed to improve the situation. It was agreed that pub-lic and private sectors should work together to improve the situation,

which includes creating a working group within the AmCham to pro-vide recommendations to the relat-ed government agencies to jointly tackle the challenges in the IPR pro-tection sector.

Please contact the AmCham of-fice if you wish to join the initiative #AmChamIPR and follow recent de-velopments at www.amcham.uz.

Mukhammadali Makhmudov (Legalmax), Olga Voronova (Procter & Gamble).

Pavel Salikhov (Mars Corporation), Djakhangir Aripov (PETOŠEVI LLC), Alisher Fayzullaev (General Director of the Agency on Intellectual Property Republic of Uzbekistan).

Participants of a seminar.

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november 28, 2018 compliance committee initial meeting

For international business, especial-ly multinational companies that ope-rate globally, compliance is an impor-tant aspect of their activity. The failu-re to comply to the rules can have severe consequences for business-es. The best practices are stipulated by several legislative acts, which in-clude the Foreign Corrupt Practice Act (FCPA) introduced in the USA in the 1970s and the EU’s main legisla-tive act introduced by the GDPR in May of 2018. The FCPA enforced an-ticorruption and compliance and was significantly complemented by the GDPR. Both are wide ranging and ap-ply to anyone doing business in the US and the EU and with US and EU citizens and entities.

Companies found guilty in viola-tion of compliance rules are subject-ed to criminal or civil actions that in-clude fines, suspension, exclusion of licenses and government contracts as well as other penalties. Liable em-ployees, compliance managers and di-rectors can also be subject to prison sentences. Penalties vary from USD 2 million per violation (which could apply to each illegal payment) for a company, and USD 250,000 and/or up to 5 years of imprisonment for each violation

for culpable individuals. Violation of books and records and internal con-trol provisions can be a subject to criminal fines up to USD 5 million and imprisonment for up to 20 years for culpable individuals.

T h e D e p a r t m e n t o f J u s t i c e ( D O J ) i s r e s p o n s i b l e fo r c r i m i -nal and civil enforcement of provi-sions. The Securities and Exchange Commission (SEC) is responsible for civil enforcement of cases relat-ed to securities and issuers required to file reports with the SEC. Both the DOJ and the SEC cooperate with fed-eral agencies, like Federal Bureau of Investigations (FBI) and other law en-forcement partners to investigate po-tential violations.

Therefore, it is important that all employees be informed about com-pliance rules, adherence to the rules and how to report violations. In other words, it is easier to prevent than pay for violations.

Ms. Keeton, Compliance Counsel for VEON Ltd., one of the world’s largest telecom providers based in the Netherlands, was a speaker at the first AmCham in Uzbekistan Compliance Committee meeting. Being responsible for internal report-ing and investigations, Ms. Keeton shared company ’s policy in this sphere, best practices of the com-pany and techniques of employees to Speak Up. Ms. Keeton advised that the main resource used for the com-

Ms. Tuchkova , tax expert at AmCham Tax and Accounting Committee.

Participants of a seminar.


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pliance is NAMEX, where one could find global statistics, trends and leg-islative updates among others.

Interestingly, the number of re-ports in 2018 has increased by 10% in five main categories. These catego-ries include: 1—Accounting, auditing and financial; 2—Business Integrity;3—HR, Diversity, Workplace respects; 4—HSE and 5—Misuse, Misappropriation of Assets. Participants discussed dif-ferent channels for Speak Up, among which online reports are the most popular.

The issues of compatibility of US and European anti-corruption laws with local criminal and administrative procedures and the effort it took to find solutions was discussed. Another issue is industry specific regulations. They can be among the most com-plex challenges that vary significant-ly in different jurisdictions. They re-quire a great deal of effort in compli-ance. The financial sector is a good example of this type of challenge. There are huge numbers of laws that vary from country to country, and the fines for falling out of compliance with them can be huge. This becomes es-pecially complex when laws contra-dict one another, or products vary in different locations.

It was agreed that the commit-tee should meet regularly for multi-national and local company of differ-

ent industries, including telecommu-nications and finance, can share their best practices. For an update of fu-ture meetings please follow the com-mittee’s news at the AmCham web-site and Facebook and Instagram pages.

september 26, 2018 tax and Accounting seminar

AmCham Tax and Accounting Com-mit tee organized half a day seminar on September 26, 2018. The aim of a seminar was to inform members of the AmCham about changes in the

Tax legislation that have been intro-duced since the beginning of the year 2018. The tax consultant Ms. Zoya Tuchkova was invited to brief mem-bers on the recent changes.

The seminar was co-organized by AUDIT-AS, Business Associate of Crowe Horwath and hosted by U-Cell, AmCham Platinum member. Over 50 participants of the seminar enjoyed the coffee-break provided by U-Cell.

W h i l e t h e c h a n g e s f o r t h e 9 months were numerous, the half a day seminar covered the most sig-nificant. Zoya Tuchkova also provid-

Ms. Tuchkova, AmCham Tax and Accounting Committees seminar.

Members of AmCham.

H. E. Pamela Spratlen, US Ambassador to Uzbekistan and employees of Oasis— M. Mirzaev Training Center.

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ed detailed answers to the questions from the audience on practical issues related to taxation and accounting.

It is useful to know that the new web-site https://soliq2018.uz/ de-veloped by UZINFOCOM is aimed to update the taxpayers on the re-cent changes in the tax legislation. The web-site contains three main sections: taxation of a physical per-son, taxation for enterprises and Individual Entrepreneurs. The infor-mation on the taxation is regularly updated and is available in Uzbek and Russian languages.

us Ambassador’s visit to oasis fes Agricultural training Center

On August 3, 2018, staff, partners and friends of AmCham member Oasis FES LLC had the distinct plea-sure in welcoming US Ambassador to Uzbekistan, Pamela Spratlen, to tour the Oasis-M. Mirzaev Agricultural Tr a i n i n g C e n t e r l o c a t e d a t t h e Uzbekistan Republican Orchardists School, just north of Tashkent city. Since 2012, through a Public and Private Partnership with an institu-tional connection, Oasis FES has steadily invested in the school’s in-frastructure and organizational ca-pacity with plans to host all spheres of agricultural trainings for the private sector.

Ambassador Spratlen’s visit in-cluded a tour of the 0.4 hectare ir-rigated demonstration gardens and training shop facility led by Facility Engineer Murad Ziayey. Mr. Ziayey is a 4-time J-1 USA Agricultural Trainee, and one of 25 Uzbeks who have par-ticipated in this agricultural manager development program under Oasis auspices. She viewed a short video highlighting recent Horticulture, Food Safety and English for Agriculturalist trainings currently available at the C e n t e r. L a n g u a g e D e p a r t m e n t Manager Tatyana Pilatskaya acknowl-edged how helpful the US Regional English Language Office resources and E-Learning programs have been to the professional development of her 7-person teacher team. Training Consultant Dr. Hasan Boboey shared his appreciation for his recent 3-week s t u d y to u r o n Fo o d S afet y a n d Agricultural Trade under the auspices of the US Bureau of Educational and Cultural Affairs International Visitor Leadership Program.

The tour included a walk-through of the 55-bed student hostel of class-rooms, an agricultural English library, computer center and other VIP fa-cilities including wi-fi throughout the hostel. It was an honor for the Center that Ambassador Spratlen cut the rib-bon and opened the newly renovated commercial kitchen which meets na-

tional and international food safety fa-cility standards.

Dr. Peter Malyicini, Director of t h e C e nte r fo r Po l i c y Re s e a rc h a n d O u t r e a c h a t We s t m i n s t e r International University in Tashkent, noted that this agricultural training center with an emphasis on the private sector, is well poised to launch a new level of collaboration. Ambassador Spratlen mentioned to Jean Henry, co-owner of Oasis FES, and her hus-band Dale, that it was evident that the Center had been carefully developed in a thoughtful manner. She wished the Center well in its endeavors to de-velop talent in water and land manage-ment and in the environmental, agri-cultural and food processing sectors of Central Asia. Oasis FES is current-ly in negotiations with the World Bank to host 40 Uzbek women agricultural entrepreneurs from Fergana Valley for a week of training in Agribusiness and Horticulture at the Center.

A s Chairman of the A m Cham committee on Agriculture and Food Processing, Dale Henry welcomes an initiative to share the co-chair-manship of this important commit-tee. Former public health nurse and farmer’s daughter, Jean Henry, par-ticipates on the AmCham committee on Tourism Industry and Hospitality with a particular focus on food safe-ty issues. O

Tatyana Bystrushkina (AmCham), Alexandru Simboteanu (Embassy of Romania).

H. E. Pamela Spratlen, US Ambassador to Uzbekistan visiting Oasis—M. Mirzaev Training Center.


CoMMittee neWs

The tourism sector has contributed 10 percent to the global GDP last year. This sector of the economy requires a comparatively small investment while allowing for generation of hard curren-cy inflow. The creation of small and medium enterprises and start-ups in technologically advanced countries in the private sector has provided much needed employment to the local pop-ulation. Therefore, a full day was ded-icated to the tourism industry of the Global Entrepreneurship Week ( GEW) held in Tashkent during November 12–17, 2018.

The Global Entrepreneurship Net work (GEN) provides a range of programs and initiatives aimed at crea ting a global business ecosystem. GEN helps people in more than 170 countries around the world to reveal their potential, to enter the interna-tional level, thereby strengthening the

financial stability of the company and the country's economy.

The Global Entrepreneurship Week (GEW) is a celebration of in-novators and employers that launch start-ups, revitalize business ideas, and stimulate economic grow th. Within one week, every November ev-ery year in all countries of the GEN net-work, GEW inspires people through lo-cal, national and global events aimed at helping to explore its potential.

During the GEW Uzbekistan 2018: P 40+ companies participated in or-

ganization as partners; P 68 events were organized on 31 lo-

cations in 4 cities of Uzbekistan (Tash kent, Samarkand, Bukhara and Karshi);

P 5500+ local participants attend-ed events;

P 50+ foreign par ticipants (USA , Spain, Estonia, Israel, Turkey, Russia,

Ukraine, Belorussia, Kazakhstan, Tajikistan, China, Singapore, New Zealand);

P 100+ speakers in events; P 1 000 000+ audience covered via

mass media and internet.The AmCham Tourism and Hos-

pi ta lity Industry Committee held the seminar “Why Uzbekistan: tourism sector development issues” during the GEW. Over 100 participants from the tourism sector of Uzbekistan in-cluding state agencies (state tourism agency, national railways and airlines), hotels, tour operators and internation-al airlines attended the seminar.

Anvar Allagergenov, the Head of the department, State Committee of Tourism Development stated

“The government of Uzbekistan puts a priority on the tourism sector devel-opment in Uzbekistan, therefore the reforms in this sector are tremendous with 140 practical measures that facil-itated visa processing and mandatory temporary registration of foreign citi-zens via www.Emehmon.uz”.

Main developments include: P Introduction of visa free regime for

9 countries and simplified visa for 43 nationals

P Car rentals for up to 30 days to foreign citizens and nationals of Uzbekistan

P Simplified investment procedures for investors in the tourism sector

Shuhrat Azimov (AMBIT), Tatyana Bystrushkina (AmCham), Muzzafar Kasimov (AMBIT).

Anvar Allabergenov (State Committee for Development of Tourism of Uzbekistan).

AMChAM touRisM seMinAR in the frAmework of the globAl entRepReneuRship Week

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AMCHAM UZBEKISTAN

This has resulted in: P Launch of 199 new tour operators

within the 9 months of 2018 vs 127 in 2017

P 1 2 0 p ote nt i a l i nve s to r s f ro m 20 countries (US, China, South Korea, Turkey, Germany)

P 3.9 million tourists (internal and inter-national) in 2018 vs 1.8 million in 2017

“ The government continues re-forms in the tourism sector and is open to recommendations and pub-lic and private partnership coopera-tion models” finished Allabergenov.

Puneet Tandon, Hyatt Regency Area Vice President, General Mana ger and Chairman of AmCham Tourism and Hospitality Industry Committee praised the government of Uzbekistan for the tremendous work accomplished in the sector of tour-ism development. He especially not-ed that the steps taken to liberalize vi-sas, upgradation of the arrival termi-nal at the Tashkent International air-port, procurement of new aircrafts in-cluding new DREAMLINERS by the na-tional air carrier enabling it to enhance its connectivity with the world—both by way of opening new routes and by also increasing the frequencies within the ex-isting route maps. He mentioned that it is important to further enhance airline connectivity and work on improving ser-vices—as inflight services, online check-in etc. Globally, the online reservations

(hotels, airlines, tourist attractions) pro-vide a greater degree of comfort and en-hance the tourist experience.

Successful countries where the flow of tourists exceeds resident pop-ulation of the country such as Spain, France and Israel have under tak-en destination marketing efforts and worked on the building of a brand im-age for the country as a whole. The im-age is built around the differentiators of the country. By way of exquisite his-tory and culture, culinary traditions, safety and security, genuine and warm hospitality, affordable prices, fantastic weather, Uzbekistan already has a lot to offer to the international travellers. A comprehensive destination market-ing campaign for the country will great-ly enhance its visibility on the world stage and this will directly and positive-ly motivate travellers from across the world to want to travel to Uzbekistan.

It is well known that leisure tourism in Uzbekistan depends a great deal on the season. Globally, 65% of travel is lei-sure travel, and 24% is business or cor-porate travel. To offset the losses of the tourism sector during the low sea-son (winter and summer) in Uzbekistan, Puneet suggested to incentivize cor-porate travel that would fill in the gaps during the low season. He suggested the creation of a Convention Bureau for the country. World over, Convention Bureaus play a leading role in promoting

the destination and attracting business tourism. As convention travellers con-tribute to the success of all tourism col-laborators in the destination (e. g. hotels, DMCs and tour operators, independent restaurants, locations of cultural and recreational interests etc.), such an or-ganization will definitely add tremen-dous value to the economy and sup-port the country in its drive to attract more arrivals to it. Key elements of this would require an effort by tourism play-ers from public and private sectors and coordination by government agencies to work together. Results may not be ev-ident in the short term, but the eventu-al benefits far outweigh the costs and the efforts necessarily undertaken to put something as this together.

Kate Tetley of the British Council (London, UK), Skills Expert from People on Workforce development for Tourism sector, raised the issue of personnel training in the tourism industry. She shared information about global prac-tices, programs of the tourism sector and employee trainings, elaborating on three projects in Uzbekistan. The British Council holds programs in the tourism colleges in Uzbekistan and conducts on the job trainings. They are piloting three more projects in terms of flexible learn-ing and different lengths of training.

Participants of the Q&A session agreed that the problem of personnel in the tourism sector is a global chal-lenge. It was recognized that qualified and trained personnel may choose other professions (such as the airline industry) instead of tourism, because they may receive higher compensation and benefits.

The discussion also raised the is-sues of the price of tours and travel in Uzbekistan. They remain relatively high due to the cost of airfare and vi-sas for foreign nationals and their fam-ily members who work in Uzbekistan.

At the end of the seminar, partic-ipants agreed that regular dialogue between private and public sectors should continue, while more events on various topics related to tourism should be regularly organized and rec-ommendations shared. O

H. E. Edward Shapira (Israel Embassy), Kate Tetley (The British Council), Puneet Tandon (Hyatt Regency).


CoMMittee neWs

september 27, 2018 Monthly Meeting

The Minister of Innovative Deve lop-ment, Professor Ibrokhim Y. Abdu rakh-monov, spoke before 60 members of AmCham and diplomatic corporations during the September 27th meeting. Created by a presidential initiative in November of 2017, the mission of the Ministry of Innovative Development is to ensure the accelerated innova-tive development of all sectors of the economy and social sphere by utiliz-ing several strategies. These strate-gies include using advanced foreign experience, modern achievements

of work science and ground break-ing ideas. As the ministry continues to grow, it is attracting foreign consul-tants who will share their experiences and best practices. Currently, 3 con-sultants work in the Ministry, in ad-dition to 105 local staff members. A plan is in place to recruit 10 more for-eign specialists from Germany, South Korea, the United States, Israel and other countries.

As the Ministry develops its strat-egy, it plays a key role in Uzbekistan’s ambitious plan to rank in the top 15 innovative nations in the world by 2030. The country has great poten-tial and basis to achieve the target.

The scientific basis represented by the Academy of Science and a world-wide recognized scientist residing in Uzbekistan. However, research cen-ters in innovative countries such as the United States and Israel are affi-liated with well-known and respect-ed universities e. g. the Silicon Valley (Stanford University). On the con-trary, Uzbekistan Academy is sepa-rate from the universities. Additionally, scientific breakthroughs in innovative countries are driven by private sec-tor companies like Tesla and Google. In Uzbekistan, the sector of innova-tions is still directed by the govern-ment. According to the Minister, only

Q&A session of the monthly meeting.

Hugo Minderhoud and Ibrokhim Abdurakhmonov.

Ibrokhim Y. Abdurakhmonov (Minister of Innovative Development).


AMChAM events

0.2% of the country’s GDP is allocat-ed to support the innovation sector, with a plan to increase it to 0.8% with-in the next three years. In a plan to in-cite interest and motivate researchers, Uzbekistan will allocate 70% of the in-come to the researcher and 30% to the team. The ministry is also develop-ing a detailed plan for the innovation sector that will provide solid results showing improvements of globally ac-cepted indicators of innovation index-es.Following his presentation, Minister Abdurakhmonov answered a series of questions from the audience. He named three top priorities for devel-opment that include innovations in en-

ergy that would save the environment and be effective in the agricultural and textile fields.

Profe s s o r A b durak hm o n ov i s a leader in genomic s science in Uzbekistan. His research specialties include genomics, germplasm char-acterization and genetic mapping , marker-assisted selection, transge-nomics, proteomics and bioinfor-matics. He currently serves as the associate editor of the International Journal of Plant Genomics and the Journal of Integrated OMICs. He act s as a member of the editori-al board of the American Journal of Plant Science and the Journal of

Plant Sciences & Molecular Breeding. He is a member of the International Cotton Genome Initiative (ICGI) and serves as an executive committee member of the International Cotton Researchers Association (ICRA) in Washington, DC.

december 6, 2018 Monthly Meeting

December’s monthly meeting fea-tured a presentation by Mr. Odilbek Isakov, CFA and the Head of Debt Management Office and the Ministry of Finance Advisor. The event was held in the recently renovated Hotel

Nodir Rasulev (Mercury Service) and a guest.

Hugo Minderhoud (AmCham), Tatyana Bystrushkina (AmCham), H. E. Ms. Ingrid Tersman (Ambassador of Sweden).

Hugo Minderhoud (AmCham President) opening remarks.

Turgay Karaagac (Bureau Veritas), Ruslan Daminov (Global Translation Service), Pierre-Paul Antheunissens (IDEMIA), Omon Muminov (Softline International) and a guest.

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AMCHAM UZBEKISTAN

high literacy rate close to 100%. The strategic location of Uzbekistan en-ables access to the 3.3 billion peo-ple market. This makes the count-ry a strategic player in several trans-port corridors connecting China with the European market (the Silk Road Economic B elt) and S outh, and Southeast Asia. Uzbekistan is rich in diverse natural resources and miner-als. Mr. Isakov shared that Uzbekistan’s commitment to reform stands as the strong foundation that has attracted global attention. Thus, Uzbekistan is a top reformer in 2017, climbing from 166th place to 76th place (according to WB guide “Ease of Doing Business”). Mr.

Isakov was quoted as stating “The gov-ernment of Uzbekistan values its co-operation with IFIs, not only because of the access to so-called “cheap money”, compared to the capital market, but al-so because of the technical expertise in different sectors that these institu-tions provide along with money.”

Uzbekistan was successful in se-curing 20–40 loans with low inter-est rates from China and Russia and Mr. Isakov noted that the external debt of Uzbekistan is relatively low at less than 40% of GNI. In compar-ison, Kazakhstan’s external debt is at 89% and Kyrgyzstan is over 120% (WB, 2017). At the same time, the issuance

International Tashkent and had over 70 guests in attendance.

Mr. Isakov joined the Ministry of Finance in September of 2018 after having studied and worked in the UK for over a decade. He held different posi-tions in the financial sector, including over 10 years with HSBC in London, UK.

“I have spent some time on the roadshow selling Uzbekistan, there-fore I start the presentation with the selling points for Uzbekistan”—start-ed Mr. Isakov.

Indeed, Uzbekistan has a lot to offer to investors, including the biggest pop-ulation of Central Asia (32 mln) 14.3 of which are currently is a workforce with

Evgeniy Krutov (Air Astana in Uzbekistan), Husniddin Ochildiyev (Centil Law Firm).

Kamil Abidov (CASC), Vera Bell (Audit—As), Feruza Tatybaeva (Agrico BV NL), Azizkhan Akhmedov (CASC).

Mirzakhid Mirzaitdinov (Multivac Export AG), Djamshed Djabriyev (Medtronic).

Mr. Odilbek Isakov (Ministry of Finance).


AMChAM events

of the Eurobond would further con-tribute to the sustainable develop-ment of Uzbekistan. Publication of re-liable statistics is required, along with the compliance with corporate gov-ernance practices. This is expected to attract FDI’s and contribute to the greater private sector involvement. Ultimately, this is expected to create a benchmark for the country and to source great funds to Uzbekistan.

While the country would be ex-posed to possible market and cur-rency risks, there are many positive points in support of joining the debt market. Despite the turbulence (i. e. increase of the refinance rate by the

United States Federal Reserve, China war, sanctions etc.) the debt market is on the rise. Currently, the global bond market totals over USD 100 million outstanding with emerging markets accounting for the bulk of it.

The event concluded as attend-ees enjoyed exceptionally prepared appetizers by the new chef of Hotel International Tashkent.

october 3, 2018 business Mixer

Stomatologiya Budushego LLC, a long-standing member of AmCham in Uzbekistan, graciously sponsored

our October Business Mixer. The Mixer was well organized and enjoyed by all who attended. It was held in the heart of the city, at the Crystal Garden. The event was well attended, with almost 100 guests, who enjoyed spectacular Mediterranean cuisine, while socializ-ing on the lovely summer terrace.

Director of Sadaf Dental Labo ratory and a shareholder of Sadaf Clinics, Mr. Shohruh Mirzaev, welcomed guests and discussed the new technolo-gies that were recently brought to Uzbekistan. These advanced services are available in Sadaf clinics in Tashkent. the 3-D printing dental crown is pio-neered technology that enables tech-

Donald Nicholson II (AmCham), Odilbek Isakov (Minsitry of Finance).

Aybek Erkabaev (Erka Architects LLc), Shokhruh Mirzaev (Sadaf Stomatologiya), Adilbek Erkabaev (Erka Architects LLc).

Hans-Ullrich Ihm (OSCE) and H. E. Jan Bory (Ambassador of Slovakia).

Donald Nicholson II, Tatyana Bystrushkina (AmCham), Ekaterina Gorchakova (White & Case), Bakhrom Salahitdinov (Business Leasing), Odilbek Isakov (Ministry of Finance).

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AMCHAM UZBEKISTAN

INFRANET ASIA LLC was founded in 2012 and is currently the largest tele-com service provider company in Uzbekistan. Similarly, AGESA Group is the largest industry equipment sup-plier that provides turn-key services that includes the commission and in-stallation, computer diagnostics, and maintenance and repair of equipment. The company is an authorized dealer and distributor of CARRIER, STULZ UNTES-RHOSS, ARKEN, TESCOM and TOSHIBA. Finally, LEGALMAX, is one of Uzbekistan’s leading law firms that specializes in Intellectual Property, M & A and Due Diligence and Litigation. The law firm has a successful reputation

nicians to produce a crown within 1 day. This innovative technology is new in the world of dental services and only avail-able in Sadaf clinics in Tashkent.

Sadaf Clinics is the first private den-tal clinic in Uzbekistan and was found-ed in 1988. Sadaf joined AmCham in 2008. The company currently runs 4 clinics in Tashkent and has a den-tal laboratory also. The Management of Sadaf Clinics strives for excellence in the quality of services they provide. Management and doctors of the com-pany participate regularly in profession-al dental exhibitions worldwide and are committed to providing the most inno-vative dental services in Uzbekistan.

october 17, 2018 business Mixer

Members of AmCham in Uzbekistan and participants of the Eighth Central Asian Trade Forum (CATF) attended the October 17th Business Mixer at The Chef Restaurant to celebrate the suc-cessful launch of the Forum. Almost 500 participants from the private sec-tor, international organizations and dip-lomatic missions attended the event. The Mixer was sponsored by AmCham member companies Agessa Group, Legalmax and Infranet Asia.

All three companies have well established root s in Uzbekistan.

H.E. Mosud Mannan (Fmbassador of Bangladesh) and a guest.

AmCham members at Business Mixer.

T. Bystrushkina (AmCham), Z. Nazhmet di-no va and V. Lugom (Comfort Technologies).

AmCham members and guests networking at October Business Mixer.


AMChAM events

and its client base consists of leading corporations and financial institutions from all over the world, including those from Canada, Finland, Russia, South Korea, Spain, Switzerland, The United Kingdom and the United States.

The Deputy Assistant Administrator of USAID, Mr. Javier Piedra, welcomed guests and expressed his appreciation to companies for participating in the forum. He stated “The forum is sup-ported by USAID’s Competitiveness, Trade and Jobs Activity in Central Asia. This facilitates exports and employ-ment in horticulture and strengthens tourism, transport and logistics servic-es across the five Central Asian econ-

omies. The success achieved is due to the private sector companies and the participants of the forum”. Mr. Piedra also shared a special thanks on behalf of USAID to the sponsors of the eve-ning’s business mixer.

AmCham in Uzbekistan’s Executive Director, Tatyana Bystrushkina, shared her thoughts on the forum and eco-nomic development. She stated that

“A strong private sector drives eco-nomic development in any country. Participants of CATF are mainly SME sector companies from the private sector across the Central Asian region. This year the number of participants exceeded 1500 and are from different

sectors across the region. These sec-tors include transportation, tourism, information technology, equipment manufacturing, horticultural produc-tion and processing, as well as ma-ny others. Going even further, the or-ganization of the forum was possible in thanks to member companies that provided support in various ways that include participation in the forum ex-hibitions, organizing seminars or pro-viding sponsorship of the event”.

The Chef restaurant not only pro-vided an exquisite meal, but entertain-ment and music as well. The guests al-so enjoyed a fashion show by the tal-ented uzbek designer.

Jennifer Bigelow (General Motors) and David LeBlond (UzBAT).

Sergey Levin (Coca-Cola company), Malika Tursunova and Mukhammadali Makhmudov (Legalmax).

Nodira Yadgarova (TIC) and Umida Tadjieva (Helath and Travel).

Mukhammad Ali Kamaljan, Makhamadkadir Vaxidov and Bora Aksahin (Agessa Group Technologies).

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AMCHAM UZBEKISTAN

neW MeMbeRs

Starting in 2005 with Hilti AG (Schaan, Liechtenstein) and Leica Geosystems (Heerbrugg, Swit zer land), BNZ Industrial Support supplies innovative solu-tions and technologies into the ma-jor industrial spheres in Uzbekistan. From 2007, BNZ operates the on-ly fully accredited calibration labo-ratory for high-precision surveying equipment in Uzbekistan

BNZ began work in hydrocar-bon supply sector in 2008 with Honeywell Safety (USA), Snap On Industrial (Kenosha, WI), and also added TAM International (Houston TX), in addition to TopCo Inc (Edmonton, AB) and World Oil Tools (Calgary AB), which are now a part of Rubicon Oilfield (Houston, TX).

From 2013, BNZ has teamed with Smart Scanning Solutions the only provider of asbuilt 3D pointcloud capture services in Uzbekistan. Smart Scanning has successfully completed 3D reality capture of the Registan Mall Complex in Samarkand; the Samonid Mausoleum in Bukhara; and Tamirlane’s Arc in Shahrizabz, in collaboration with Dr. Shakhzod Takhirov, Director of the Seismic Engi-neering Laboratory at the University of California—Berkeley.

In 2018 Hexagon Mining (Tucson, AZ) chose BNZ as its partner in Uzbe kistan. Hexagon is a leading-edge technology provid-

er in the mining industry, developing and deploying data collection and analytical tools for intelligent mining companies around the globe.

Architectural & engineering project design development for commercial, residential buildings. Technical sup-port for light and heavy industry, ag-riculture, health, education, mining, roads. Detailed design shop draw-ings production, 3-d visualization. Const ruc tion & fit-out execution of any complexity project under “turn-key” solutions. International project adaptation with technical support & State expertise.

INFRANET ASIA LLC was founded in 2012 and is currently the biggest Telecom Service Provider Company in Uzbekistan with more than 500 in-ternal staff members and 8 offic-es around the country. We also take part in infrastructure projects out-side of the field of telecom business.

The Law Firm LEGATE was set up by lawyers with more than

Aybek Erkabaev and Adilbek Erkabaev (Erka Architects LLc).


WelCoMe AboARd

15 years of working experience in commercial law.

LEGATE provides its custom-ers with a personal and complex ap-proach to solving legal issues in the banking, telecommunications, oil and gas, construction and other commercial industries. The compa-ny lawyers and attorneys render le-gal services in Uzbek, Russian, English, Turkish and French languages.

LEGATE maintains partnership relations with a number of leading law firms in Russia and CIS countries, Europe and USA.

MULTIVAC is one of the leading pro-viders worldwide of packaging solu-tions for food products of all types, life science and healthcare products as well as industrial items. Our port-folio covers nearly all customer re-quirements with regard to pack de-sign, output and resource efficiency, and includes vacuum chamber ma-chines, traysealers, thermoforming packaging machines, labellers, quali-ty control systems, automation solu-tions and even turnkey lines. Our cus-tomers benefit from our profound

knowledge of processes and sys-tems, as well as from an integrated advisory service all from one source.

The MULTIVAC Group has appro-xi ma tely 5,600 employees world-wide, with about 2,100 based at its headquarters in Wolfertschwenden, Germany.

With more than 80 subsidiaries, MULTIVAC is represented on all con-tinents.

ONS Frankfurt GmbH is an interna-tional engineering and trading compa-ny working in CIS and Middle Eastern countries. They offer engineering ser-vices on EPC model and a wide range of trading services in oil and gas, min-ing, metallurgy and railway industries. The Uzbek-German Trade House, a project of ONS Frankfurt GmbH, is a commercial platform for export-im-port transactions between compa-nies of the Republic of Uzbekistan and EU countries.

PETOSEVIC is a wholly owned net-work of intellectual property (IP) firms specializing in IP services. With over 120 employees working in 16 of-fices located in: Albania, Belgium, Bosnia & Herzegovina, Bulgaria, Croatia, Hungary, Macedonia, Montenegro, Romania, Russian Federation, Serbia, Slovenia, Ukraine and Uzbekistan. The network’s gov-erning entity is in Luxembourg.

In total we cover more than 30 ju-risdictions in Central and Eastern Europe, and we also work through af-filiated offices in Armenia, Azerbaijan, Belarus, Czech Republic, Estonia, Georgia, Kazakhstan, Kosovo (UNSCR 1244), Kyrgyzstan, Latvia, Lithuania, Moldova, Poland, Slovak Republic, Tajikistan and Turkmenistan.

Rentals Ltd is a web-based portal for real estate that focuses on serv-ing foreign clients and is a local re-

Zebo Shaislamova (LEGATE law firm).Eldar Mustafaev and Lenur Mambetov (Infranet).

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AMCHAM UZBEKISTAN

al estate company as well. Our real estate agents have gained valuable experience during their time work-ing abroad and are committed to providing excellent customer ser-vice to all clients.

SCHNEIDER GROUP provides its in-ternational clients with the back of-

fice services they need to expand their business into or within Russia, Kazakhstan, Belarus, Ukraine, Poland, Uzbekistan and Armenia. Our services include market en-try support, accounting outsourc-ing, tax consulting, import, ERP sys-tems, support in the settlement of disputes and advice on a broad range of legal issues with focus on compliance, migration, labor, con-tract and corporate law.

SCHNEIDER GROUP is your one stop partner in Russian speak-ing countries and in Poland for a smooth and successful start or ex-pansion of your business abroad.

We are part of LEA (Leading Edge Alliance), the second largest international association focused on accounting, financial and busi-ness advisory services.

SCHNEIDER GROUP supports you with entering a new market

Mirzakhid Mirzaitdinov (Multivac Export AG). Tatyana Bystrushkina (AmCham), Vadim Berdyanski (ONS Frankfurt GmbH).

Umida Solijonova (PETOŠEVIC LLC). Djakhangir Aripov (PETOŠEVIC LLC).


WelCoMe AboARd

within just a few days and without the hassle of company registration via our office-in-office solution.

Market AnalysisDistributor searchRecruiting servicesOut-staffingOffice in office solutionsFully equipped working desks with

full office infrastructureUpgrade 1C accounting to a full

ERP System

Import handlingSAP implementationTransparency in AccountingAutomation of AccountingControlling of AccountingWe take over the function of the

General Director and make sure all administrative obligations are met

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itiesSearch construction and project

management firms

TURKSIB MAGISTRAL LTD is a freight forwarding company that has been successfully operating in the international and domes-tic cargo transportation markets since 2008. We provide+ a full range of freight forwarding servic-es, such as multimodal, road, rail-way and air transportation.

We perform cargo transporta-tion to Uzbekistan of consolidated (LCL) cargos from various cities of Europe, China, Turkey and the CIS.

The company has its own fleet of vehicles for the transportation of goods, including bulky (up to 100 tons) and oversized cargo.

UHY Tashkent is an audit and as-surance company founded in 2004. UHY Tashkent s a member of UHY—an international network of legally independent accounting and con-sulting firms.

From its inception in 2004, UHY Tashkent LLC consultants have completed more than 1000 suc-cessful projects and gained signif-icant experience working with do-mestic and foreign enterprises and organizations.

Clients of UHY Tashkent LLC represent a great many sectors of Uzbek economy including light and heavy industry, oil and gas in-dustry, credit and financial insti-tutions, construction, transpor-tation, telecommunications, agri-culture, trade, supply chain, logis-tics, customs and tax authorities of Uzbekistan. O

Elena Volodina (Turksib Magistral).Zulfiya Islamova and Erkinali Karimjonov (“Rentals” LLC).

Sarvarkhon Karimov (UHY Tashkent LLC Audit organization).

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As delivered

Thank you for that kind introduction.I am pleased to be here to ex-

press the U. S. Government’s com-mitment to Uzbekistan as we contin-ue to work together to improve the business opportunities between our two nations.

Thank you to the American-Uz be ki-stan Chamber of Commerce for orga-nizing this event.

And thank you to the distinguished guests and hosts from the govern-ment of Uzbekistan.

I want to applaud the successful political and democratic reforms that are underway in Uzbekistan, and to en-courage your continued commitment to them.

Such reforms are improving the business and investment climate of your country, and they are leading to a

new era of growth and prosperity that will benefit the citizens of this country and those in the region.

It was my pleasure to dine with President Mirziyoyev when he visited President Trump in Washington this past May.

We look forward to working with him and the Government of Uzbekistan at making your goals—such as member-ship in the WTO—come to fruition.

H a v i n g t r a v e l e d t h r o u g h o u t the world both in my capacity as Secretary of Commerce and during my career in the private sector, the types of reforms the President has embraced here are essential to es-tablishing the certitude that compa-nies need to open operations in the local economy.

Once companies feel comfort-able and begin to invest, the nation-al economy will experience a strong

and vir tuous economic cycle of growth.

Companies that are confident in making investments hire local workers.

They create innovative products; take risks; invest in new equipment, factories and research; they export and import; and they generate tax rev-enues that lead to social and cultural benefits that extend far beyond the business sector.

With that in mind, congratulations to the Government of Uzbekistan for partnering with the U. S. on the suc-cessful “U. S. Business Week” event held last week here in Tashkent.

The meetings of the U. S.-Central Asia Trade and Investment Framework Agreement Council were also host-ed last week by the Uzbek Ministry of Foreign Trade.

The Office of the United States Trade Representative was part of

WelCoMe speeCh of us secretAry of commerce WilbuR Ross duRing his visit to uzbekistAnuz.usembassy.gov

Wilbur Ross (United States Secretary of Commerce).

Wilbur Ross (United States Secretary of Commerce) and Sodiq Safoyev (First Deputy Chairman of the Senate).


disCussions

that ef for t to bring of f icials from across the region together to find ways to increase trade among our nations.

As President Trump discussed with President Mirziyoyev in their Oval Office meeting in the White House in May—as well as when they met in Riyadh, and again in New York City—the United States is committed, ab-solutely committed to being a strate-gic partner in your growth and devel-opment, through trade, investment, and your outreach to other nations in Central Asia.

We are already seeing positive re-sults from these efforts.

A m e r i c a n c o m p a n i e s a re f a r more engaged than ever before in Uzbekistan.

The U. S. Commerce Department is working with the Uzbek Government in expanding trade in the region.

Our Commercial Law Development Program has five working groups in-volved with the Uzbekistan govern-ment addressing technical and legal issues associated with trade, protect-ing intellectual property rights, and en-couraging the economic empower-ment of women.

This U. S.-Central Asia Trade and Investment Framework Agreement Council also discussed upgrading Afghanistan’s status from observer to being a full member.

The United States supports Afgha-ni stan’s full membership because of the impor tance of integrating Afghanistan into the Central Asian re-gional economy.

There are many other important initiatives being undertaken now that the Uzbekistan government has em-braced its reform agenda.

Just last week, on October 17th and 18th, the U. S. Agency for International Development and the Uzbek Ministry of Foreign Trade co - hoste d the Central Asian Trade Forum in Tashkent.

This was the first time this annual event was ever held in Uzbekistan, and it reflects the opportunities that exist for investment in Central Asia’s most populous market.

This year’s forum was the largest ev-er, with more than 1,600 government and business leaders from 25 coun-tries in Central and South Asia, Europe, and the United States. The forum saw agreements for over USD 54 million in future deals, and many contacts were made that will further strengthen re-gional trade cooperation.

Many U. S. companies attended the event, including General Motors, General Electric, Visa, Procter and Gamble, Citibank, and Coca-Cola—to just name a few.

Thank you to the American Cham-ber of Commerce for partnering with USAID in making that forum such a

success and I am looking forward to meeting members of the American Chamber of Commerce later on today.

The “U. S. Business Week” held here last week also fulfilled a commit-ment made by President Trump and President Mirziyoyev during his trip to Washington in May.

It, too, was a big success.But we know there is more work to

be done.It will be important for Uzbekistan

to establish and maintain a track re-cord of transparency and rule of law.

Adopting global business practic-es is required in government procure-ment, customs procedures, and in the protection of intellectual property, in taxes, and in regulations that impact exporters, importers, and investors.

State control of the economy will not lead to the growth that can be gen-erated by private-sector investment.

A free market inspires indigenous entrepreneurship and innovation whose benefits extend well beyond business and industry.

Creating a system that allows peo-ple to fail—so that they can learn from their mistakes and apply those lessons in their next endeavor—is an essential ingredient for long-term success.

State-owned enterprises and gov-ernment subsidies to keep inefficient companies afloat tend to work against the interests of society.

Representatives of the US business.

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AMCHAM UZBEKISTAN

They stifle growth.In the United States, anybody who

tries to create a company and fails is not chastised for their failure, but is heralded for their efforts.

And even the biggest companies are allowed to fail—Sears being the lat-est casualty.

People learn and move on. They start new enterprises.

Companies with the world’s highest market cap are all American firms, and they did not even exist until fairly recently.

Apple, Google, Amazon and Face-book were created in people’s base-ments, garages, and college dorm rooms.

All four of those companies—and many others that are not beholden to state controls—have transformed the global economy.

They have created jobs for millions and millions of people.

And established companies that continue to thrive—like those of you in the room today—are consistently rein-venting themselves.

They cannot sit still. They are always on the edge of uncertainty.

They must constantly improve their own products.

They embrace new technologies and business systems.

Economic freedom does more for a country than any other activity.

And so does opening up govern-ment procurement.

When contracting with U. S. com-panies on public tenders, the citizens of Uzbekistan can be guaranteed that there are no shady deals involved.

The 1977 Foreign Corrupt Practices Act prohibits U. S. companies from en-gaging in any type of corrupt practice to win contracts.

The law is strictly enforced by the U. S. Department of Justice and has been in-strumental in fighting corruption.

It provides officials and citizens of this country with a guarantee that when they do business with a U. S. company, they know that there are no clandestine deals, no lousy terms to a state-backed loan, and no exchange of cash-laden briefcases.

When you do business with Ame-ri can companies, a new generation of aspiring Uzbekistanis gains expe-rience in corporate governance and best practices.

They apply what they have learned to local enterprises.

President Trump commended President Mirziyoyev’s efforts to build bridges and relationships between Uzbekistan and its neighbors.

Doing so will facilitate the success of every country in the region.

The United States hopes that Uzbe-kistan will continue to play a crucial role

in creating stability and prosperity for the broader Central Asia region.

As you work towards a bright future of opportunity for all of the people in this great and important region of the world, please know that the United States stands with you.

My being here today is proof that that is the case.

Thank you very much!

october 16, 2018

Today, senior of f icials of the gov-e r n m e nt s of t h e U n i te d St ate s , Uzbekistan, Kazakhstan, Kyrgyzstan, and Turkmenistan met for the Council Meeting of the U. S.- Central Asia Trade and Investment Framework A greement ( TIFA) to discuss the trade and investment environment in Central Asia and the United States. Afghanistan and Pakistan participated as observers.

U n d e r t h e TI FA , t h e m e m b e r countries launched the Intellectual Property (IP) Working Group, which will facilitate development of robust IP protection and enforcement pol-icies to promote economic growth, creativity, and the health and safe-ty of all countries in the region. The countries also launched the work of the Group on Women’s Economic E m p o w e r m e n t . O t h e r Wo r k i n g

Opening remarks by Wilbur Ross at Annual American-Uzbek Business Forum.


disCussions

Groups met on customs, standards, sanitary and phytosanitary measures.

The TIFA Council expressed deep appreciation to the Government of the Republic of Uzbekistan for its hospital-ity and agreed that the next meeting of the U. S.—Central Asia TIFA Council would take place in Washington, DC 2019 (uz.usembassy.gov).

dinner with principal deputy Assistant ( pdAs) for economic and business Affairs of the u. s. department of state

On September 12, 2018, AmCham Board of Directors and Platinum m e mb e r s we re invite d to a din -ner event with the visiting Principal Deputy Assistant Secretary (PDAS) for Economic and Business Affairs of the U. S. Department of State, Brian McFeeters.

Participants exchanged views on current trade and regulatory reform practices, investment climate and foreign direct investment. They al-so discussed prospects for increas-ing economic cooperation between Uzbekistan and the United States in-cluding the development of trade and investments and the implemen-tation of mutual agreements. PDAS McFeeters stressed that the rela-tionship between the two countries

is flourishing with increased visits of high level Uzbek officials to the United States. President Shavkat Mirziyoyev’s US visit and meeting with President Trump in May of this year was followed up with visits from delegates from the Ministry of Foreign Affairs, the Senate and other representatives. As a re-sult, bilateral trade has increased. The trade turnover has increased from USD 210.2 million in 2017 to USD 300 million in 2018.

There is a signif icant potential for further increases as coopera-tion between Uzbekistan and the United States continues to improve.

Participants discussed potential busi-ness opportunities for US companies in Uzbekistan. Some possibilities men-tioned were in the banking and finance sector, consulting, energy, pharma-ceuticals, and tourism.

Upcoming business event s in October include the 8th Annual Central Asia Trade Forum and the 2018 U. S.-Uzbekistan Annual Business Forum. Other business opportunities for both Uzbek and US companies will be an-nounced shortly.

For more details about events and AmCham, please visit www.amcham.uz or contact the AmCham office. O

Mark Linscott, Assistant U.S. Trade Rep-re sentative for South and Central Asia.

TIFA countries' representatives meeting.

AmCham Platinum members dinner with PDAS Brian McFeeters.

35WWW.AMCHAM.UZ

AMCHAM UZBEKISTAN

In this issue, we have summarised the most notable changes to tax legisla-tion in accordance with the Law No. ЗРУ–508 of 24 December 2018

The Law of the Republic of Uzbe-ki stan No. ЗРУ–508 of 24 Decem ber 2018 (Law) introduces changes to the tax legislation in line with the Tax Reform Concept approved in June 2018. That said, the Law only amends the existing edition of the Tax Code, while a new Tax Code is expected to be enacted by 1 July 2019.

As anticipated, the changes include: P New criteria for simplified tax regime. P Flat rate of personal income tax. P Abolishment of 8% employee con-

tribution to Pension Fund.

tAx ChAnges in 2019Tax and Legal Alert / Issue No. 5 / 28 December 2018

P Termination of 3.2% obligatory con-tribution to the designated state funds charged on turnover.

P Reduction of Unified Social Pay-ment’s rate.

P Changes in Corporate Income Tax rates.

P Reduction of property tax rate and withholding tax rates on dividend and interest for residents.

P Introduction of the tax rates on ma-jor taxes into the Tax Code (previ-ously, approved annually by Reso-lu tion of the President).

Below, we provide some details on the changes above and summarise other notable amendments to the Tax Code effective as of 1 January 2019.

personal income tax

Personal Income Tax (PIT ) will be charged at a flat rate of 12% (previous-ly, charged at progressive rates ranging between 7.5% and 22.5%).

New flat rate will also apply to cer-tain types of income that previously were subject to the minimal tax rate of 7.5%, including rent income, capi-tal gain from sale of personal real es-tate etc.

Dividends and interest income re-ceived by individuals – residents of Uzbekistan – will be subject to taxa-tion at 5% (previously, 10%).

PIT reports should now be filed on a monthly basis (previously, report-


legislAtions

ed quarterly) and contain breakdown on employment income, property in-come, benefits-in-kind for each em-ployee.

PIT should be paid along with sub-mission of documents to the servic-ing bank for salary payment. As of 1 January 2019 deadline for remittance of PIT cannot be later than the date of submission of PIT return.

social charges on payroll

Individual Pension Fund Contribution (PFC) of 8% will be abolished as of 1 January 2019.

Unified Social Payment (USP) is generally reduced from 25% to 12%. However, 25% USP will remain pay-able by state organisations, legal en-tities with state participation of at least 50%, as well as legal entities where at least 50% belongs to the latter.

As of 1 January 2019, USP also ex-tends to certain new categories of tax-payers, including individual entrepre-neurs and their employees, members of family enterprises, farming enter-prises, artisans etc.

Corporate income tax (Cit)

Changes to the Corporate Income Tax rates are summarised in the Table 1.

Rate of income tax withheld at the source of payment from dividend and interest income paid to residents is re-duced from 10% to 5%. Tax rates ap-plicable to income paid to non- resi-dents, including dividends, interest, royalties, telecommunication fees and other income remain unchanged.

deductibility of expenses

Currently, the list of deductible ex-penses is closed, while non-deduct-ible expenses are provided in an open list (i.e. all expenses which are not ex-plicitly mentioned as deductible are treated as non-deductible). As of 1 January 2019, list of non-deductible expenses is going to be closed, while the list of deductible expenses – open. This should allow avoiding situations where certain types of business ex-penses are treated as non-deductible since they are not listed as deductible.

Limit s on deductibil it y of cer-tain types of expenses are abolished.

Thus, the following expenses will be ful-ly deductible:

P representative expenses (currently, limited to 1 % of turnover);

P per diems during business trips (currently, deducted within estab-lished norms);

P voluntary insurance (currently, lim-ited to 2 % of turnover);

P compensation of harm to health caused to employees (currently, specific limits are established de-pending on type of compensation).Following expenses, without limita-

tion, are now treated as non-deduct-ible:

P charity and sponsorship payments, irrespective of the recipient (cur-rently, there is a defined list of re-cipients);

P expenses on events that are not re-lated to business operations of tax-payer (i.e. events on health protec-tion and recreation);

P taxes paid on behalf of non-resi-dents and other taxpayers, as well as taxes and other obligatory pay-ments accrued during tax audits.

Certain depreciation caps have been changed as outlined in the Table 2.

table 1

Taxpayers Current rate Rate as of 1 Jan 2019

General rate for legal entities, except for those shown below

14% 12%

Commercial banks 22% 20%

Mobile communication operators 14% on profit attributable to profitability lower than 20% and 50% rate on profitabil-ity higher than 20%

20% regardless of profitability

Legal entities producing:cement (clinker)polyethylene granules

14% 20%

table 2

Fixed asset Current rate Rate as of 1 Jan 2019

Buildings and structures 5% 3%

Railway, river and air transport 8% 4%

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AMCHAM UZBEKISTAN

property tax

Property tax rate is reduced 5–2%.To increase efficiency of property

usage, the Property Tax rate is dou-bled for equipment not installed in due timeframe and for overdue con-struction-in-progress. As of 1 January 2019 micro -f irms and small enti-ties are also considered as payers of Property Tax irrespective of the turn-over or headcount.

unified tax Payment (utP)

The existing headcount criterion for eligibility for simplified tax regime is replaced by the turnover thresh-old. Generally to qualify as Unified Tax Payment (UTP) payer, the annual turnover should not exceed UZS 1 bln. (approximately, USD 120k). Besides legal entities the following entities with turnover of up to UZS 1 bln. have been included into the list of UTP payers:

P individual entrepreneurs, P family businesses, P non-commercial organisations in

relation to income generated from commercial activity.

General rate of UTP is reduced from 5% to 4% as of 2019.

As of 1 January 2019, UTP payers shall also be responsible for payment of Property Tax, Land Tax, and Water Use Tax (previously, not paid by UTP payers).

vAt

As of 1 January 2019, all entities with turnover exceeding UZS 1 bln. (ap-prox. USD 120k) are considered as VAT payers. Entities with turnover of up to UZS 3 bln. will have an option to apply a ‘simplified VAT’ mechanism (detailed in the next section).

Input VAT related to fixed assets, in-tangible assets and construction-in-progress will be eligible for offset (pre-viously, capitalised). Thus, for immov-able property used in entrepreneurial activity, the input VAT may be offset in equal portions through 36 months. Input VAT related to purchase of oth-er fixed assets and intangible assets – in equal portions through 12 months.

Legal entities that become subject to VAT (e.g. by switching to standard tax regime due to exceeding annual turnover threshold, or/and by becom-ing VAT payers voluntarily), will have a right to offset input VAT related to leftover inventory, long term assets and finished goods in stock.

As expected, VAT rate remains un-changed at 20%. However, VAT should now be reported on a monthly basis by all taxpayers, including micro and small enterprises.

simplified vAt

Until 1 January 2021, legal entities with annual turnover not exceeding UZS 3 bln., including enterprises paying tax-

es under simplified tax regime, have a right to apply Simplified VAT regime.

Generally, eligible taxpayers shall, until 1 February, notify respective tax authority on selection of Simplified VAT.

Simplified VAT regime envisages application of differentiated VAT rates from 4% to 15% depending on type of activity as shown in the Table 3.

Please note that the Simplified VAT regime does not envisage offset of input VAT.

Taxpayers engaged in several activi-ties subject to different Simplified VAT rates, should keep separate account-ing for each activity. If the annual turn-over of the Simplified VAT payer ex-ceeds UZS 3 bln., it becomes subject to the standard VAT regime (i.e. 20% VAT rate and offset of input VAT).

Simplified VAT payers should is-sue VAT invoices to their customers indicating VAT rate charged. If the customer is under the standard VAT regime, it can offset the input VAT based on the VAT invoice issued by the Simplified VAT payer.

Similarly to standard VAT regime, reporting and tax payments under Simplified VAT regime should be made monthly.

excise tax

List of taxable objects for Excise Tax purposes has been supplemented by the following:

table 3

Taxpayers VAT rate (%)

General rate for legal entities, except those shown below 7

Construction enterprises 8

Retail and wholesale activities 6

Catering and hotel services 10

Providers of professional services (e.g. audit, tax consulting, brokers, consulting, etc.) 15

Sales of agricultural products, except for sales of own produced goods 4


legislAtions

P Sale of petrol, diesel and gas to fi-nal consumers (Excise Tax replac-es Petrol and Diesel Consumption Tax).

P Provision of mobile communica-tion services.

Please also note that taxpayers are no longer eligible to offset input Excise Tax paid at purchase/ importation of goods.

tax Audits

New types of tax audits have been introduced to replace scheduled and non-scheduled tax audits as follows:

P Audits conducted under consent of the authorised state body on coordination of inspections of en-terprise’s activities (i.e. audit of fi-nancial and economic activities of the taxpayer; audit conducted based on the application of indi-viduals and legal entities claiming the taxpayer’s breach of the legis-lation or based on the outcomes of the risk analysis run by the tax authorities).

P Audits conducted upon notifica-tion of the authorised state body on coordination of inspections of enterprise’s activities (i.e. au-dit conducted due to liquidation of a legal entity; audit to eliminate facts of production and sale of prohibited goods/services).

Please be advised that regulation on carrying out tax audits of non-com-mercial organisations, non-residents of Uzbekistan carrying out activities through permanent establishment, as well as representative offices and branches of foreign legal entities shall be established by the State Tax Committee separately.

The Law also increases the duration of short term tax audits to 10 working days (previously, 1 working day).

Moreover, concept of ‘Thematic E xpre s s A nalysis’ is intro duce d . Thus, tax authorities may visit tax-payers to conduct Thematic Express Analysis based on the result s of ‘cameral control’ for verification of

the information provided by taxpay-ers and eligibility to apply tax and customs incentives reflected in tax reports. Duration of the Thematic Express Analysis should not exceed 7 calendar days. During this Analysis taxpayers are allowed to voluntarily rectify the tax violations.

Penalties and fines

Tax authorities have been given the right to suspend bank operations of legal entities in the event of: (i) ab-sence of taxpayer at the place of reg-istration; (ii) taxpayer’s failure to sub-mit tax and financial reports, or fail-ure to provide justification on dis-crepancies or adjustment to tax re-por ts based on the cameral con-trol. Please be advised that current-ly, court decision is required for tax authorities to suspend bank opera-tions.

The rate of late payment interest (LPI) has increased from 0.033% to 0.045% per each day of delay (which is in line with the increased annual refinancing rate of 16%). However, if additional taxes are accrued during tax audit, the LPI is charged at 0.06% per day.

other changes

T h e L a w g r a n t s t h e C a b i n e t of Ministers an authority to provide in-centives on taxes and other obligatory payments in certain cases (such cas-es are not specified). Currently, as per the Tax Code, incentives can be pro-vided only by Tax Code, other laws of

Uzbekistan and by decisions of the President.

In addition, Large Taxpayers shall submit tax reports to the special Interregional State Tax Inspectorate for Large Taxpayers, regardless of the location of the taxpayer.

***

PwC would also like to remind of the approaching deadlines for an-nu al t ax f i l ing s fo r PER M A N EN T E S TA B L I S H M E N T S a n d I N D I V I -DUALS.

C O R P O R AT E I N C O M E TA X (CIT ) return f iled by PERMANENT ESTABLISHMENT for 2018 is due by 25 March 2019.

PERSONAL INCOME TA X (PIT ) return for 2018 is due before 1 April 2019. In accordance with the Tax Code, Uzbek PIT is paid by tax resi-dents - on their worldwide income, and by non-residents – on their in-come received from Uzbek sources. An individual is deemed to be a tax resident if he/she spends 183 days and more during any 12-month peri-od ending in the reporting year. The Tax Code further states that if a for-eign national has become tax resi-dent prior to 1 April of the year follow-ing the reporting one (i.e. has arrived in Uzbekistan prior to October 2018 and stayed through 1 April 2019), he/she is required to file a PIT declara-tion for the reporting year (i.e. 2018).

Please feel free to contact us with queries on the annual tax filing re-quirements or if you need support on other tax issues.

© 2018 PwC. All rights reserved. Not for further distribution without the permission of PwC. “PwC” refers to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL), or, as the context requires, individual member firms of the PwC network. Each member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide any services to clients. PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or bind them in any way. No member firm is responsible or liable for the acts or omissions of any other member firm nor can it control the exercise of another member firm’s professional judgment or bind an-other member firm or PwCIL in any way.

The material contained in this alert is provided for general information purposes only and does not contain a comprehensive analysis of each item described. Before taking (or not taking) any ac-tion, readers should seek professional advice specific to their situation. No liability is accepted for acts or omissions taken in reliance upon the contents of this alert.

39WWW.AMCHAM.UZ

AMCHAM UZBEKISTAN

The design and projecting of mechanical systems and electrical power supply systems.

Anna ShapkinaDeputy of Head office in Uzbekistan

Tel.: +998 (71) 270-7474, Mob.: +998 (97) 720-2174

Email: [email protected]

Translation Services

Ruslan DaminovDirector

Mob.: +998 (90) 921-9163Email: [email protected]

Legal services

Tel.: +998 (71) 200-1005, +998 (78) 150-8360/61


Audit and consulting services

Sarvarkhon KarimovDirector

Mob.: +998 (91) 162-0102

Insurance Industry

Miraziz KhidoyatovMob.: +998 (90) 968-9330

Fax: +998 (71) 232-2307Email: [email protected]

Freight Forwarding, Project Logistics, Removals & Relocation, Value-added Services

Sevil BekirovaBusiness Development Manager

Tel.: +998 (78) 129-9900Fax: +998 (78) 129-9911


Representative “AGESA GRUP”

Discount: 25% for all kind of services and goods.Date this service is valid: until 31.12.2019

UHY Tashkent LLC

Discount: 5%Date this service is valid: 2019/02/28

Legalmax Law Firm

Discount: 10%Date this service is valid: 31/12/2019

Global Translation Company

Discount: 15%Date this service is valid: until 31.12.2019

Globalink Logistics

5% discount on Removals & Relocation Services to AmCham members.

Date this service is valid: December 31, 2019

Gross Insurance LLC

Discount: 15–25% discount depending on the type of insurance product

Date this service is valid: until December 31, 2019

Insurance services. General insurance

Umid KhudayberdievHead of Insurance Department

Tel.: +998 (90) 905-2080Fax: +998 (71) 252-2898


Food and Beverage Services

Veronika SaparovaPR & Social Media Officer

Tel.: +998 (78) 120-4900, +998 (94) 655-4924Fax: +998 (78) 120-4902


Household goods Moving and Cargo Logistics services

Atabek AlimdjanovCountry manager

Tel.: +998 (71) 235-1843Fax: +998 (71) 235-7390


INGO-UZBEKISTAN JSIC

Discount: 20% travel insurance; 25% Cargo/Logistics insurance; 20% Motor/Vehicle complex insurance; 10% Property insurance; 15% Obligatory insurance;

5% Medical insuranceDate this service is valid:

During 2019-2020 business year

Move One Logistics

Discount: 7% discount for moving and 5% for logistics services

Date this service is valid: end of 2019 year

Radisson Blu Hotel Tashkent

Discount: 15% discount on a la carte menu in Café Europa, Aqua Bar & Restaurant.

Date this service is valid: the service is valid until 31.12.2019.

The discount cannot be used during special events, festive season and

in conjunction with other promotions.

AppliCAtion foR ChAMbeR MeMbeRship

Chamber Membership Categories

Membership Category Qualifications Annual Dues

Vo

tin

g M

em

be

rs

Platinum Annual worldwide revenues of $100m and above

USD 4,000

Gold Annual worldwide revenues less than $100m and more than $5m

USD 3,000

Annual worldwide revenues less than $5m USD 1,500

No

nv

oti

ng

me

mb

ers

Silver Annual worldwide revenues less than $100m USD 1,000

Bronze Annual worldwide revenues less than $5m USD 600

Non-profit Registered as a non-profit organization USD 500

Non-resident Organization with no local representation/registration in Uzbekistan

USD 1,500

All categories give the member access to a full range of services and benefits including business de ve lopment function, the committee network, and all publications.

Nonvoting members may not vote or sit on the Board of Directors.

1. Please indicate the category of membership for which you are applying: Membership is per calendar year. Enrollment is prorated by the number of months remaining in the calendar year.

Type of membership Annual Dues Type of membership Annual DuesG Platinum USD 4,000 G Bronze USD 600G Gold USD 3,000 G Non-profit USD 500G Gold USD 1,500 G Non-resident USD 1,500G Silver USD 1,000

2. I/We agree, if accepted, to be bound by the Chamber’s rules and regulations, and to pay the appropriate annual dues:

Name of company

Address

Tel. Fax E-mail

Head of firm in Uzbekistan:

Name Title / Position

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AMCHAM UZBEKISTAN

Representatives (voting if American Company)

(first alternate)

(second alternate)

3. Nationality of parent company:

G US G Uzbekistan G Other (please specify)

Place and Date of Incorporation

4. Type of company in Uzbekistan:

G Manufacturing facility G Sales/Representative office G Service facility

Brief description of activity:

Addresses of branches or other offices in Uzbekistan:

Specify relationship with firm in the USA (if any): branch, subsidiary, affiliate, joint venture, sales offic-

es. Give US name, complete address, telephone and fax number:

5. Please indicate the approximate amount invested into the economy in Uzbekistan:

G USD 1,000–10,000 G USD 100,000– 1,000,000G USD 10,000– 100,000 G More than USD 1 million

6. Number of employees in Uzbekistan at all locations:

G less than 20 G less than 50 G 50–100

7. Annual revenue:

G less than USD 100,000 G USD 100,000–500,000 G More than USD 500,000

Prepared by Date

Signature of applicant

Important notice: Information found on this application is for internal AmCham use only and will be handled as business confidential.


AMCHAM UZBEKISTAN

platinum memberBAT UzbekistanDavid LeBlond(78) 120-5555CNH IndustrialAlisher Tangribergenov(78) 120-7450CocaCola Mes. Paz. Dan. San. Ve. Tic. A. S.Shadab KhanErnst & YoungAnvar Azamov(78) 140-6482General Motors Operations UzbekistanJennifer Bigelow(71) 280-6433Hyatt Regency TashkentPuneet Tandon(71) 207-1234PwCOtabek Muhammadiev(78) 120-6101UzCarlsberg LLCNadav Geller(78) 140-9999UNITEL LLCDmitriy Shukov(90) 970-1383UcellTõnu Grünberg(93) 180-0000

gold memberAKTE LLCHugo Minderhoud(71) 252-2402BNZ Industrial SupportBrian Quigley(71) 254-4128

Central Asia SeedAzizkhan Akhmedov(71) 291-9353Crowe Horwath Int. (AuditAs)Vera Bell(71) 241-4618Daewoo Pack Co, Ltd.Jang Dae Won(71) 295-0573Erka Architects LLcAybek Erkabaev(90) 970-5515Hotel International TashkentSardor Malikov(78) 120-7000Hotel Radisson Blu TashkentAkmal Muratkulov(78) 120-4900Infranet Asia LLCLenur Mambetov(71) 244-0803«KPMG Audit» LLCSanjarbek Saidov(78) 147-7744Kinstellar Business Services S. á. r. l.Joel Benjamin(78) 150-6222OLSOFTEvgeniy Olevskiy(71) 256-3291ONS Frankfurt GmbHVadim Berdyanski(71) 252-2156Perspektiva Stroy InvestUgur Akin(71) 233-5097

S.Verenin’s Legal GroupSergey Verenin(78) 150-1506Transcontinental JV LLCJanna Popkova(78) 120-3838Wyndham Tashkent HotelIsmail Kalinci(78) 120-3700WCH Service bureauAlexander Tulupov(71) 254-3621

silver memberAir Astana in UzbekistanYevgeniy Krutov(78) 140-3002Centil Law FirmZafar Malikov(78) 120-4778Deloitte va Touche LLCErkin Ayupov(78) 120-4445Frito Lay Manufacturing Vakolatxonasi (PEPSICO)Aidar Turmukhamedov(71) 281-4609«Grata» International Law FirmBakhodir Jabborov(71) 230-2422General Electric CompanySaidolim Artikov(71) 205-0281«GROSS INSURANCE» LLCAbduaziz Abdusattorov(71) 232-2305IngoUzbekistan Insurance CompanyBakhtiyor Gaybullaev(78) 150-9999JV Indorama Kokand Textile LLCDeepak Raina(71) 253-8325IDEMIAPierre-Paul Antheunissens(71) 238-5970JP Morgan Chase Bank Tokhir Sultanov(78) 140-3770

SEP Nestle UzbekistanSergey Tratsevskiy(78) 140-0600Schneider Group LTDNodir Ayupov(78) 120-4430Winncom TechnologiesKhurshidkhudja Isokhudjaev(78) 150-0837

bronze memberAction Group LLC EduActionUmid Ishmukhamedov(78) 148-8686Avialeasing Aviation CompanyIgor Smirnov(78) 120-4950AFSResearchYuliya Bakhmatch(71) 234-9611Agesa GrupMurat Aksahin(71) 280-6243Agrico BV NLFeruza Tatybaeva(71) 256-8484Business LeasingDildora Umurzakova(78) 120-3040Baker Tilly TashkentGuzal Islamova(78) 150-1512Carolina TechnologiesAlexander Veksler(71) 281-4362Comfort Technologies OfficeZukhra Nazhmetdinova(90) 996-4116COUNCIL Law FirmAlisher Kadirov(71) 233-3399CJ ICM FZcoRavshan Fazilov(71) 254-0019Davinci Solutions LLCHilola Suleymanova(71) 113-2390DGP Research & CounsultingAkmal Vasiev(71) 148-8282

MeMbeRship list

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AMCHAM UZBEKISTAN

Dentons CA LimitedEldor Mannopov(78) 150-3105Education Standard Consulting GroupElena Sergeeva(71) 268-7544Elan Express LLCBabur Asuraliev(78) 150-2550GOR Investment LTDMartin Dunkan BurgessGlobalink LogisticsShabir Firdous(78) 129-9900Global TranslationRuslan Daminov(90) 914-7627Grant ThorntonNematulla Karimov(71) 234-4632Holos Ltd.Khalmurat Manaev(71) 252-7185Health and Travel LLCUmida Tadjieva(71) 281-5526HR Capital ConsultingAziz Kurbanov(78) 150-4230Iberiasia TourFarkhod Sabirov(71) 255-4990SE «Ishan Group»Khwaja Zia Ahmed(71) 262-0012Legalmax Law FirmM. Makhmudov(71) 212-4732LEGATE law firmZebo Shaislamova(71) 244-0020Kosta Legal Law FirmAzizbek Akhmadjonov(71) 238-9428«Marvel Dry Foods» LLCNematjon Askarov(71) 129-1916Mega Prodex LLCNormukhamedov M.(71) 246-1611Mercury Service Events & Travel Management Murod Makhmudov(71) 235-7771

M&M Militzer & MuenchKhurshid Kasimdjanov(78) 140-0003Move One LogisticsAtabek Alimdjanov(71) 235-1843«MULTIVAC EXPORT AG»Mirzakhid Mirzaitdinov(71) 237-5702NamunaDiyor Private Scientific Industrial EnterpriseFurkat Salimov(71) 255-3278Oasis FES LLCDale Henry(71) 237-5315PETOŠEVI LLCDjakhangir Aripov(78) 120-6514Prae Legal UzbekistanDavron Ahmadov(71) 198-2112«Rentals» LLCErkinali Karimjonov(97) 454-3344Softline InternationalAybek Arifdjanov(78) 120-4909Sitara International Shiraz Poonja(71) 281-4148Spaarmann TashkentNozimjon Mamasoliev(78) 120-7887Stomatologiya BudushegoZafar Usmanov(71) 232-2022Train Consultancy LLCMashrab Saidov(71) 235-0424Turksib MagistralJean Aydarov(78) 120-3865UHY Tashkent LLCSarvarkhon Karimov(71) 233-1448Wakefield Inspection Service Ltd.Philip Hesketh(71) 273-1071Zudlik TransDaniyar Yusupov(71) 244-0484

non-Profit non-votingAMBiTHikmat Abdurakhmanov(71) 269-9339The British SchoolAdrian Macaulay(71) 262-6020Canadian ConsulateEldor Manopov(78) 120-7270OSCEHans-Ullrich Ihm(98) 140-0468Tashkent International SchoolJohn Gates(71) 291-9670Tashkent International ClinicMatthew Kuschel(71) 291-0142

honorary MembersADBCindy Malvicini(78) 140-1920IMF Resident Representative OfficeGalina Kostina(71) 233-4243UNDPStefan Priesner(78) 120-3450World Bank Country Office / IFCJan-Peter Olters(71) 238-5950

IFCZafar Khashimov(78) 120-2454

non-ResidentAggreko Eurasia Limited Liability CompanyArsen Pogosov(97) 705-1713Birches Group LLCLourdes Belen+1 (646) 837-5553BA Logistics IncShukhrat Begmatov(97) 737-8804Bureau VeritasTurgay Karaagac(78) 150-7127Dow Europe GmbH Representative officeArthur Eritspokhov+7 (495) 663-7984Mars Kazakhstan LLPPavel Salikhov+7 (727) 258-8005

non-Resident– non-ProfitDr. Gregory GleasonUniversity of New Mexico+49 (8821) 750-2526

individuAlIlkhom Khodjakulov+49 (175) 997-3902Benjamin Schneider


MeMbeRship list

Vera Bell

Tax and Accounting Committee meets on a regular basis bringing together a dynamic group of se-nior professionals from the leading auditing companies, multination-als, and tax specialists.

Tax & Accounting Committee Trade & Investment Committee

Gabil Ahmadov

Trade and Investment Committee meets and engages with the major issues faced by local and foreign investors as well as those dealing with commercial matters.

Tourism & Hospitality Industry Committee

Puneet Tandon

Tourism & Hospitality Committee brings together on a regular ba-sis the many members in the ho-tel—tourism sector, with the focus being on how to improve service, deal with issues and contribute to the sector’s growing importance.

Agriculture and Food Processing Subcommittee

Dale Henry

Agricultural and Food Processing Sub com mittee brings together a wide range of interested players including representatives of the public sector to review and dis-cuss a full agenda of related issues.

ChAiRs of AmchAm CoMMittees


AMChAM

Corporate & Social Responsibility Committee

Nodira Yadgarova

Corporate & Social Responsibility Committee meets to review and discuss the ways in which the business community can best serve its many stakeholders in-cluding those in need.

The Membership Committee

Shabad Khan

Membership Committee looks to not just attract new candidates for membership in AmCham but al-so how to best serve the existing members.

Human Resource Committee

Rano Nurmuratova

The Human Resource Committee provides analysis and updates on HR trends, labor and employee re-lations, compensation and ben-efits.

Digital Transformation Committee

Omon Muminov

Digital Transformation Committee meets to help its members to get acquainted with the latest digital and technological trends.

Corporate Governance Committee

Yuriy Voytsitskiy

Raising awareness of Gover nan ce, Risk, and Compliance instruments and methods, benchmarks and trends in the sphere of anticorrup-tion and bribery, risk management, and corporate governance.

Intellectual Property Rights SubCommittee

Mukhammadali Makhmudov

To study and monitor intellectu-al property and copyright issues in Uzbekistan and Central Asia. AmCham IPR Committee works closely with the government of Uzbekistan (draft legislation, pro-vide recommendations) to im-prove IPR practices in Uzbekistan and to attract investors.

47WWW.AMCHAM.UZ

AMCHAM UZBEKISTAN

boARd of diReCtoRs 2019

J. Laurence Wright IIEx-Officio BOD member, U.S. Embassy in Tashkent

Secretary:Joel BenjaminKinstellar Business Services

Treasurer: Vera Bell Crowe Horwath Int.

Puneet TandonHyatt Regency Tashkent

Anvar AzamovErnst & Young

David Le BlondUzBAT

VicePresident: Tõnu Grünberg Ucell

Otabek MukhammadievPwC

Executive Director:Tatyana Bystrushkina

President: Hugo Minderhoud AKTE LLC

Shadab KhanCoca-Cola Uzbekistan

Business Connections is semi-annual and annual reports for members that are published 2 times a year for American Chamber of Commerce in Uzbekistan.

Executive DirectorTatyana Bystrushkina

Editorial BoardDonald Nicholson II Hugo Minderhoud Julia Bakhmatch Jean Henry Mary Fowler Igor Fedorov Diyorbek Baymatov

Contributing AuthorsDonald Nicholson II Tatyana Bystrushkina Julia Bakhmatch Dale Henry Fakhritdin AbdujabborovTatyana Bystrushkina

Address: 4B, Afrosiab Str., 100031 Tashkent, UzbekistanPhone: +998 (78) 140-0877Fax: +998 (78) 140-0977Email: [email protected]: www.amcham.uz

The AmCham Uzbekistan and authors declare that they have compiled this document care-fully and to the best of their knowledge. However, no war-ranty or representation is made to the accuracy of complete-ness of the information con-tained in this document. The AmCham Uzbekistan and au-thors assume no liability what-soever for any damage resulting from the use of this document or its contents.

This bi-annual free-of-char-ge advertising bulletin is not considered to be a subject of mass communication and may be distributed free of charge without registration among lim-ited number of entities and in-dividuals.

Printed by CLOSSAUzbekistan, Tashkent 10001593, Avliyo-Ota streetTel: +998 (71) 2813998

President Emeritus:Donald Nicholson IISEAF-SME Investment Management


AMCHAM UZBEKISTAN

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