Legal forms of companies in Uzbekistan
Located in the heart of Central Asia, Uzbekistan is a country with a rich history and a dynamically developing economy. After economic reforms and openness to foreign investment, the country offers a favorable business environment, including tax incentives and access to a growing market.
Starting from January 1, 2025, Uzbekistan introduced flat rates for corporate income tax (15%), value-added tax (12%), and personal income tax (12%). This makes the tax system one of the most competitive in Central Asia. Furthermore, businesses can take advantage of investment deductions of up to 20% of the cost of new equipment and 10% of capital expenditures on production expansion.
There are several legal forms available for foreign and local investors wishing to establish a presence in Uzbekistan, including joint stock companies, limited liability companies, etc.
1. Joint stock companies (JSCs).
Advantages:
– May have one or more shareholders.
– JSC’s shareholders are not liable for the JSC’s liabilities.
– No minimum charter capital requirement (except of certain activities set out minimum capital requirements for JSCs).
Disadvantages:
– Time-consuming and highly regulated process.
2. Limited liability company (LLC).
Advantages:
– May have one or more participants.
– Participants are not liable for the company’s liabilities. Risk of company’s losses is limited to their contributions to the charter capital.
– No minimum capital requirement (except of certain activities subject to licensing may require to comply with the minimum capital requirements).
– Does not issue shares. Instead, participants have ownership (participating) interests in the company.
Disadvantages:
– Certain types of businesses (such as banks) can not be established as an LLC (such as banks).
Foreign companies may also operate in Uzbekistan through representative offices (RO) and permanent establishments of foreign entities.
3. Representative office (RO) / Permanent establishment (PE) of foreign legal entities.
RO is a structural subdivision of a foreign legal entity that is established. RO does not constitute a legal entity, all rights and obligations are assumed by the foreign business legal entity that established the RO (the main legal entity). An RO is established exclusively to represent and protect the interests of the main legal entity, and its activities must be limited to marketing and non-transactional support for the head office.
Alternatively, it is possible to register a PE of a foreign legal entity in Uzbekistan for purely tax purposes. A PE does not constitute a legal form of the company`s presence.
Should you require more information on the nature and uses of various business forms in Uzbekistan, EMZE Law offers tax and legal advice on how to structure a specific business in Uzbekistan depending on the investor’s particular industry or commercial plans, as well as a full range of company formation and registration services.
Process of company formation in Uzbekistan
State registration of a company in Uzbekistan is carried out based on a “one-stop-shop” principle whereby all registration documents are submitted to a single center for the provision of public services to business entities (the “One-Stop-Service Center”). There is an option to submit documents to the One-Stop Service Center electronically through the e-government web portal.
Uzbekistan’s law requires the following set of documents to open a company:
– Charter documents;
– Legal address information.
– Personal ID number of an Individual (the “PINFL”) if a foreign citizen holds the position of CEO (General director, Chairman, etc);
– Passport of the shareholder(s);
– Passport of the CEO;
– Power of attorney (if the documents are submitted by an authorized representative);
– Bank receipt on paying of state duty.
The company registration process should take no more than 5 business days.
Opening corporate bank account in Uzbekistan
Opening a corporate account in Uzbekistan begins with choosing a suitable bank that meets your company’s needs. Once you’ve selected a bank, you must prepare and submit the following documents:
1. Application.
2. Company documents (state registration certificate, charter, TIN).
3. A card with signature specimens and a seal imprint.
4. Document confirming the company’s address.
5. Tax ID of the CEO.
The time it takes to open a corporate account depends on the bank and the completeness of the documents provided. On average, the process takes 1 to 5 business days, depending on the bank and the completeness of the documents provided. Many banks offer free account opening and maintenance, but fees may apply for certain transactions.
Some banks may require the personal presence of the director or authorized representative when opening an account. It is recommended to check the requirements of the selected bank in advance.
Corporate taxes in Uzbekistan
In Uzbekistan, corporate taxation involves the following taxes:
1. Income tax
2. VAT (value-added tax)
3. Withholding tax
4. Property tax
5. Social tax
You can read more about corporate taxes in our article at this link.
FAQ
What business type should I choose to start company in Uzbekistan?
Nowadays Uzbekistan gives a lot of support to various spheres of activity by applying tax incentitives and other benefits. The following activities can be considered in more detail for starting a business in Uzbekistan:
– Information Technology and Digital Services;
– E-Commerce;
– Tourism and Hospitality;
– Healthcare and Medical Services;
– Agribusiness and Agricultural Processing.
Can I use my rented apartments for legal address?
Be advised, that private apartments may not be accepted as the legal address of a company.
Under Uzbekistan’s law, government authorities (including tax authorities) require legal entities and ROs to be present at the legal addresses indicated in their foundation documents and in the registration records of the authorities.
If an entity is not represented at its legal address, the entity may be subject to an administrative fine, and its corporate bank accounts may be seized.
Is there any minimum charter capital for the company in Uzbekistan?
For enterprises with foreign investment, the minimum authorized capital is 400,000,000 UZB soums ($ 31 000). A foreign investor must own at least 15% of the authorized capital.
What are the popular banks for opening corporate accounts in Uzbekistan?
The choice of bank depends on the specifics of the company’s activities, services offered, and terms of service. There are many banks in Uzbekistan offering corporate account opening services. Among the most popular are:
– National Bank of Uzbekistan (NBU). Offers accounts in national and foreign currencies and also provides online banking services for convenient account management.
– KDB Bank Uzbekistan. Offers current, term, and savings accounts in various currencies, including Uzbek soums, US dollars, euros, and others.
– Kapitalbank: Offers various pricing plans for corporate clients, including free account opening and maintenance, as well as favorable payment terms.
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