Uzbekistan plans to cancel mandatory sale of 15% of shares in joint stock companies to foreign investors

Tashkent, Uzbekistan (UzDaily.com) -- Uzbekistan plans to abolish procedure, which requires joint stock companies to sell at least 15% stake in their charter capitals to foreign investors.

A draft resolution of the President of Uzbekistan “On measures to further develop the stock market and increase the efficiency of joint-stock companies”, developed by the State Committee on Competition, was published for discussion.

The document also proposes to abolish requirements for minimum size of the placement of shares at the auction to recognize placement as valid.

It is also planned to liquidate the Commission on increasing the efficiency of joint-stock companies, which was created by presidential decree in 2015.

Uzbekistan introduced requirement to sell 15% stake in joint stock companies to foreign investors in December 2015. From 1 July 2016, new joint stock companies were forming their charter capitals with a stake of foreign investors.

It is also planned to cancel the practice of appointing state attorneys to manage state shares in joint-stock companies, with the assignment of their functions to members of supervisory boards of joint-stock companies appointed in accordance with the established procedure.

The document will also cancel the requirement to determine the annual state competition and the Ministry of Finance of the Republic of Uzbekistan an annual list of audit organizations for conducting external audit at enterprises with a stake in the state in the authorized capital of more than 50 percent.

Starting from 1 July 2018, the period for considering an application for state registration of an issue of equity securities is reduced from 30 to 20 days.

Quarterly and annual reports, as well as significant facts in the activities of joint-stock companies, are published centrally on the Unified Portal of Corporate Information, the document says.

The draft resolution notes that joint-stock companies have the right to issue shares with a par value or no par value. At the same time, the increase in the authorized capital due to reinvestment (capitalization) of profit and added capital is carried out by issuing additional shares, placed proportionally among shareholders.

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