Investment Guide

Business Expenses

1. Establishment expenses

Effective 1 October 2001, a new procedure for state registration applies in respect to enterprises operating in the Republic of Uzbekistan.

The new procedure provides for a one stop shop registration of enterprises. Enterprises have to apply to a relevant state authority responsible for its statutory registration. Following the statutory registration with the relevant authority, such authority becomes responsible for the subsequent registration of the enterprise with tax and statistics authorities, Road Fund, Ministry of Labor, Employment and Social Security and getting permit from the Ministry of Internal Affairs for the enterprise to produce a seal and a stamp.

Registering functions are split among the Ministry of Justice and Khokimiyats (local authorities) of districts and cities. The Ministry of Justice is responsible for the registration of audit and insurance organisations, exchanges, enterprises with foreign investments and market sites (bazaars) created in Tashkent. Khokimiyats of districts and cities are responsible for the registration of all business entities, including enterprises with participation of foreign capital, except those subject to registration at the Ministry of Justice.

Under the new procedure, the registration requirements differ for enterprises with foreign investments, subject to registration with the Ministry of Justice, and enterprises with participation of foreign capital, subject to registration with Khokimiyats.

The total period of registration of the enterprise with all the subsequent registration with tax and other authorities may vary from 7 days to 1 month depending on the complexity of each case. In state registration, joint ventures shall pay a registration fee equal to 5 fold minimum salary plus US $ 500.

2. Employment Costs

2.1 Introduction

Employment of nationals and foreign citizens in Uzbekistan is governed by the Labor Code. Labor relations are regulated by collective agreements and individual employment contracts. Employment contracts must meet the standards prescribed by the Uzbek law. Foreign and local companies may hire employees directly, without using employment or recruitment agencies.

2.2 Labor card

The Uzbek nationals must provide an employer with a Labor card personal details and a record of their past and current work history. The Labor card is issued for determining the amount to be paid from the State Social Insurance Fund for employee’s temporary illness or disability and for determining employee’s rights to a state pension. If an employee does not have a Labor card, the employer must provide him/her with a new one within five days of commencing employment.

2.3 Probation period

An employment contract may set the probation period, which shall not exceed three months.

2.4 Minimum salary

Salaries or wages may not be lower than the minimum monthly salary. As of 1 November, 2006, the minimum monthly salary is 12 420 Soum (approximately US $ 10 at the official exchange rate).

2.5 Business week

The regular business week is 40 hours. Overtime work may be allowed only with the employee’s consent. There are certain categories of labor where overtime work is not permissible. Overtime work may not exceed four hours within two days and 120 hours per year. Overtime work must be compensated at a rate of at least 200% of the employee’s regular wage.

2.6 Foreign workers in Uzbekistan

Companies with foreign employees in Uzbekistan must obtain a foreign labor license from the Agency on Foreign Labor Migration Issues (the “Agency”). A licensed company must also obtain a work permit from the Agency for each foreign employee.

The Agency shall issue a foreign labor license within 30 days from the date of submission of all required documents.

The procedure for issuing work permits for foreign employees is similar to the procedure for obtaining foreign labor licenses.

A foreign labor license and/or employee’s work permit are valid for not longer than one year. The fee for a foreign labor license is 10 fold minimum monthly salary (124 200 Soum). There is no fee for an employee’s work permit.

Foreigners working in representative offices are not subject to obtaining the foreign labor license and work permit. But each foreigner working in a representative office must obtain an individual accreditation card from the Ministry for Foreign Economic Relations, Investments and Trade (MFERIT).

2.7 Average wage

According to statistical and sociological survey, by the end of 2006, the average real wages in Uzbekistan accounted for UZS 185,000 or nearly USD 150.

Since the firm and stable basis for economic development of our country has been created and with respect to the latest tendencies, we set forth a task to increase the real wages by at least 1/3 by the end of 2007, and by 2010, i.e. within the nearest three years - by 2,5 times.

3. Logistics expenses

Expenses for Transportation of the goods from the Republic of Uzbekistan to other places depend on kind of exported products and the point of destination, and are calculated within one month after getting the order.

Information about shipping agencies and carrier one can get from the International Forwarder’s Association (Phone: +99871 120 51 06) or from the Association of the International Carriers of the Republic of Uzbekistan (Phone: +99871 133 62 84).

4. Living expenses

Transport costs

Tashkent has the branched transport network. Passengers will have to pay 200 Soum for each travel by bus or subway and 150-200 Soum for each km by Taxi.

Tashkent has three subway lines. In general, subway trains arrive at every 3 to 5 minutes during the morning and evening rush hours, while during the non-rush hours arrive at every 5 to 7 minutes.

Operation hours: Weekday 06:00 - 00:00
Saturday 06:00 - 00:00

Transportation services in Uzbekistan.

Transport in Uzbekistan. Rentals of cars, minibuses, mini-vans, tourist buses, jeeps and high-class cars with drivers in Uzbekistan.

Airport pick up or drop off:

Pick up or drop off from/to the Tashkent Airport:

Car type	US$
airport car (4 pax)	15
to airport car (4 pax)	10
mini-bus (up to 12 pax)	20
tourist bus (up to 45 pax)	40
E-class car (4 pax)	45

Pick up or drop off from/to the Airports Samarqand, Bukhoro, Qarshi, Termez, Farghona and Urganch (for accommodation in hotels of Urganch):

Car type	US$
car (4 pax)	10
mini-bus (up to 12 pax)	25
tourist bus (up to 45 pax)	35

Pick up or drop off from/to the Airport Urganch (for accommodation in hotels of Khiva):

Car type	US$
car (4 pax)	25
mini-bus (up to 12 pax)	40
tourist bus (up to 45 pax)	60

Pick up or drop off from/to the Airport Tashkent (for accommodation in mountain resorts of Charvak, Chimgan and Beldersay):

Car type	US$
car (4 pax)	60
mini-bus (up to 12 pax)	90
tourist bus (up to 23 pax)	120

Whole day city excursion in the (Tashkent, Samarqand, Bukhoro, Farghona):

Car type	US$
car Daewoo "Nexia" (4 pax)	70
mini-bus (up to 12 pax)	85
tourist bus (up to 45 pax)	150
E-class car (4 pax) available only in Tashkent	200
Toyota Land Cruiser available only in Tashkent	105

One day trip Tashkent - Samarqand - Tashkent:

Car type	US$
car Daewoo "Nexia" (up to 4 pax)	140
mini-bus (up to 12 pax)	200
tourist bus (up to 45 pax)	410
E-class car (4 pax)	500

Notice:

Above mentioned rates include fueling and accommodation of the driver along the route;

The cost of one day trips is indicated for the business hours from 09:00 AM to 06:00 PM and for the maximum route of 70 km. Additional time is payable - US$ 7 for car, US$ 15 for minibus and US$ 25 for tourist bus (per hour)

Prices for one-day trip to Samarqand are given to both sides

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