Work carried out in the field of control over state participation in the economy and economic concentration
Tashkent, Uzbekistan (UzDaily.com) -- Over 8 months of 2023, the Committee for the Development of Competition and Protection of Consumer Rights received only 103 applications to obtain preliminary consent for transactions on mergers and acquisitions of business entities, as well as the acquisition of shares (stakes) in the authorized capital economic entities. Of these, 15 requests for mergers and acquisitions of business entities, 88 requests for preliminary consent to the acquisition of shares (stakes) in the authorized capital of business entities.
For 80 of these appeals, a decision was made by a special commission of the Committee to approve transactions, for 5 of them the decision of the special commission to give consent was canceled due to non-payment of the fee for issuing a document, in 17 cases corresponding letters were given stating that the corresponding response letters stating that approval is not required.
Having analyzed all received requests, the Committee gave preliminary consent to transactions worth 7,311 billion soums, of which 53.5 percent, that is, 3,910 billion soums (US$340.5 million), accounted for foreign investors.
In particular, during the reporting period, a special commission of the Committee preliminary approved the conclusion of several major acquisition transactions:
LLC "TASHKENT AQUARIUM" 99.9 percent of the share of the authorized capital of LLC "STARGATE SYSTEMS" (size of the authorized capital: 371.4 billion soums);
the company "VEON UZBEKISTAN HOLDING B.V" (Netherlands) and the company "VEON CENTRAL ASIA B.V" (Netherlands) as a group of persons 100 percent of the share of the authorized capital of the JV LLC "UNITEL" (size of the authorized capital: 31.5 million US dollars);
by TOO "MAGNUM CASH&CARRY" (Kazakhstan) 100 percent of the share of the authorized capital of PE LLC "MAJID AL FUTTAIM HYPERMARKETS" (size of the authorized capital: 210.6 billion soums).
by the company “EMTEKO HOLDING SIA” (Latvia) 85.16 percent of the share of the authorized capital of PE LLC “REKA-MED FARM” (size of the authorized capital: 5.37 million US dollars);
LLC "INSURANCE 8888" 100 percent of the share of the authorized capital of JSC "PERFECT INSURANCE" (size of the authorized capital: 37.2 billion soums).
In reviewing the sectoral transactions agreed upon by the Committee over the past 8 months, the Committee agreed to enter into construction transactions in 18 cases, trade and services in 12 cases, finance and insurance in 10 cases, light industry in 9 cases, information technology and programming in 9 cases, energy in 7 cases, digital platform (fintex) in 7 cases, in mechanical engineering in 4 cases, in the field of medical services and pharmaceuticals in 3 cases, in tourism in 2 cases, in other areas 2 cases.
Also, over the 8 months of this year, in accordance with the Decree of the President of the Republic of Uzbekistan dated July 6, 2020 No. UP-6019, 32 applications were received to obtain the preliminary consent of the antimonopoly authority to create business entities with state participation. Of these, consent was given in 12 cases to the creation of state-owned economic entities due to the underdevelopment of the commodity market, in 1 case to reorganization and was refused in 1 case due to the development of the commodity market, the presence of more than 5 private business entities in this market, and in 16 cases, a letter was sent stating that prior consent was not required to create a business entity with state participation and government institutions.
In particular, upon receipt of preliminary consent to organize business entities with state participation, preliminary consent was given to create:
JV LLC "UGE - JINLUN" for the production of hydraulic units with a capacity of up to 15 MW, the founding of JSC "Oʻzbekgidroenergo" 65 percent and the company "XJY Power Pte.Ltd" (Singapore) 35 percent (size of the authorized capital: 4.8 billion soums);
JV LLC "UzIPLBiologicals" for the production of biopesticides and biofertilizers, founded by JSC "Oʻzkimyosanoat" 49 percent and the company "IPL Biologicals Limited" (India) 51 percent (size of the authorized capital: 1.2 billion soums).
In addition, in 2 cases (Uzkimyosanoat JSC, Almalyk MMC JSC) it was established that business entities with state participation were created without the prior consent of the Committee, cases were initiated in the prescribed manner and appropriate measures were taken.
The Committee regularly carries out systematic work to monitor economic concentration and state participation in the economy, and detailed information about the work carried out in this area is brought to the attention of the general public.
We also remind you that according to Article 26 of the Law “On Competition” in the new edition (comes into force on October 4 of this year), in order to reduce the administrative burden on small and medium-sized businesses, the requirement for the value of enterprise assets for transactions requiring prior consent to a merger and absorption
increased by 5 times, and now the value of their assets is set at five hundred thousand times the amount of the base calculation. This means that if the value of assets is less than 16 billion (actually 33 billion) soums, a new procedure has been established that does not require prior consent for mergers and acquisitions of enterprises.