UZBEKISTAN LEGAL NEWSLETTER FOR JUNE 2023

Some of the most notable legal developments in Uzbekistan in June 2023 were new rules for the confirmation of the occurrence of events of force majeure, some new rules and procedures for the sale of electricity generated from renewable energy sources, and changes in the land legislation aimed to limit the direct allocation of land plots (i.e. the allocation without conducting electronic trades). A Presidential Decree on administrative reform in the water sector was also adopted.

 1.  CONFIRMATION OF OCCURRENCE OF FORCE MAJEURE EVENT

The Cabinet of Ministers has adopted a Resolution approving a procedure for confirming the occurrence of force majeure events under local commercial contracts. The Resolution among other things, provides for the following:

• the occurrence of force majeure events under a local contract can be confirmed by the Chamber of Commerce and Industry of Uzbekistan by issuing a relevant certificate in an electronic form verified by an electronic digital signature of the Chairman of the Chamber;
• relevant certificates are valid for an unlimited term and are for one-time use for the purposes of a specific contract;
• the following documents shall be attached to an application for the confirmation: a relevant contract and supplements to its, documents confirming the performance of some scope of obligations under the contract; documents on the occurrence of a force majeure event;
• the Chamber checks information about the occurrence of relevant events by applying to state bodies and other organisations;
• applications are considered within 15 calendar days.

 Resolution of the Cabinet of Ministers No. 231 of 7 June 2023

 2.  PROCEDURE TO GOVERN THE SALE OF SURPLUS ELECTRICITY PRODUCED FROM RENEWABLE ENERGY SOURCES

The Cabinet of Ministers has adopted a Resolution on the sale of surplus electrical energy produced by individuals and business entities using renewable energy sources. The Resolution, among other things, provides for the following:

• consumers who have installed renewable energy sources with a capacity of up to 20 kW shall notify JSC “Regional Electric Grid of Uzbekistan” via a special online platform;
• rules for selling surplus electrical energy produced by individuals and business entities using renewable energy installations with a capacity of up to 1MW have been approved. Relevant energy may be sold to JSC “Regional Electric Grid of Uzbekistan” (which currently purchases such energy on a guaranteed basis for prices set by the government) or other persons or entities. This may be done via the producer’s own electricity networks or networks of JSC “Regional Electric Grid of Uzbekistan” based on charges for the transmission. To arrange the sale, a producer of surplus energy shall deliver to a purchaser its offer with the attachment of the following documents: a technical description of renewable energy installations, a copy of a scheme for the connection of renewable energy installations to electricity networks, information on projected annual production of energy broken down by months, and a sale purchase contract signed by the producer. The purchaser shall consider and sign the contract, if agreed upon, within 10 business days after receiving the offer.

Resolution of the Cabinet of Ministers No. 247 of 14 June 2023

 3.  PROCEDURE FOR LAND ALLOCATION 

The President has signed a Decree, which changes or brings into compliance with the Land Code some rules and procedures for the allocation of land set in land-related by-laws. It, among other things, provides for the following:

• the abolishment of a number of benefits and exemptions allowing the direct allocation of land plots for ownership and leasing, i.e. the allocation without conducting an electronic auction; the exception remains for certain cases where land plots are granted for lease by a resolution of the Cabinet of Ministers
• a prohibition on allocating agricultural lands categorized as "irrigated lands" for non-agricultural purposes. This prohibition encompasses any allocation. The recategorization of such lands is only permitted under specific circumstances and shall adhere to prescribed procedures.

Presidential Decree No. UP-99 of 19 June 2023

 4.  ADMINISTRATIVE REFORM IN THE WATER SECTOR

The President has signed a Decree on administrative reform in the water sector. The Decree, among other things, provides for the following:

• by 2030, such functions of regional departments of the Ministry of Water Resources as water resources management, the supply of water to farms and other users, and water accounting will be transferred to private entities based on public-private partnership (PPP) arrangements;
• a Roadmap for deepening reforms in the area of water management is approved, which, among other things, envisages the following for 2023: (i) the introduction of a “Smart Water” system at 10,937 water facilities for real-time monitoring and accounting of water; (ii) the automation of management processes for 20 large water facilities; (iii) modernization and conversion to alternative energy of 16 large pumping stations based on PPP; (iv) the transfer of 52 water facilities to the management of the private sector based on PPP; and (v) the reduction of saline irrigated land areas by 43.9% till December 2023.

Presidential Decree No. UP-101 of 20 June 2023

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Have a good day!

Sincerely,
Kosta Legal Law Firm