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FEZ and SIZ

1. Special Economic Zone

A special economic zone is an area with special borders and a separate legal regime in order to attract foreign and local investments, high technologies and management experience for the rapid socio-economic development of the respective area.

The types of Special Economic Zones are as follows:

  • Free Economic Zone – creation of new production facilities, development of high-tech production, active involvement in the development of production of modern competitive, import-substituting, export-oriented ready-made industrial products, as well as ensuring the development of production intended area;
  • Special Scientific and technological Zone – a concentrated area of scientific organizations and other organizations in the field of scientific activity (Technology Parks, technology distribution centers (technology transfer), innovation clusters, venture funds, business incubators, etc.) in order to develop innovative infrastructure;
  • Tourist and Recreational zone – the territory being created for the implementation of investment projects for the construction of modern tourist infrastructure facilities (hotel complexes, cultural-entertainment, commercial, entertainment and other tourist facilities), special functional and seasonal recreation zones, providing the necessary conditions for the service of tourists;
  • Free Trade Zone-free trade zones include consignment warehouses, territories with special customs and tax regimes, as well as areas for processing, packaging, sorting and storage of goods. Free trade zones are organized at border points, airports, railway crossings or other places in the customs territory of the Republic of Uzbekistan;
  • Special Industrial Zone – an area where a separate regime of management, economic and financial activities is introduced. Special industrial zones include service and production zones, which are organized by dividing plots of land to create the necessary administrative, scientific and Technical, Production, Engineering and communication, road and social infrastructure.

In our republic 25 industrial zones have been established on a total of 8.6 thousand hectares of useful land. 650 projects worth 43.9 trillion sums have been launched in these industrial zones and more than 60,000 new jobs have been created.

For Information, 3 SEZ were established in the Republic of Karakalpakstan, 3 SEZ in Andijan region, 3 SEZ in Bukhara Region , 3 in Jizzakh Region, 1 in Kashkadarya Region, 1 in Navoi Region, 2 in Namangan Region, 1 in Samarkand region , 2 in Sirdarya Region , 1 in Surkhandarya Region, 3 in Tashkent Region, 1 in Farghana region and 1 SEZ in Khorezm region.

In Special Economic Zones 431 projects with a total value of 97,4 trillion sums are being implemented, and 55,800 new jobs are planned to be created as a result of the full implementation of these projects in the future. In terms of specialization of industrial zones, it is specialized in areas such as pharmaceuticals, food, light industry, construction materials, chemistry and petrochemicals, agriculture and electrical engineering. 1,712.3 hectares of vacant land in special economic zones are divided into 1,426 lots and placed on the e-auksion.uz website.

  Normative legal documents regulating the activity of SEZs

The activities of Special Economic Zones are regulated by the following main regulatory legal acts:

  • The Law of the Republic of Uzbekistan “On Special Economic Zones” dated February 17, 2020. LRU-604 (General Rules);
  • Tax Code of the Republic of Uzbekistan, December 31, 2019, LRU-599 (Tax benefits);
  • Decree of the president of the Republic of Uzbekistan No. DP-5600 of December 21, 2018 (procedure for auction sale of land plots) ;
  • Decree of the president of the Republic of Uzbekistan No. DP-4853 of October 26, 2016 “on additional measures to activate and expand the activities of Free Economic Zones;
  • Decree of the president of the Republic of Uzbekistan No. DP-5600 of December 21, 2018 “on measures to further improve the coordination and management of the activities of Free Economic Zones;
  • Decree of the president of the Republic of Uzbekistan No. DP-153 of June 13, 2022 “on the net of additional measures to increase the efficiency of the activities of Special Economic, Small Industrial, youth industrial and entrepreneurial zones;

Decision of the Cabinet of Ministers of the Republic of Uzbekistan dated September 7, 2023 “on approval of the administrative regulation of the provision of public services to investors in the territory of Special Economic Zones” № DCM -452;

2. List of free economic zones

      1. «Navoiy» FEZ
      2. «Angren» FEZ
      3. «Jizzax» FEZ
      4. «Urgut» FEZ
      5. «G‘ijduvon» FEZ
      6. «Qo‘qon» FEZ
      7. «Namangan» FEZ
      8. «Hazorasp» FEZ
      9. «Termiz» FEZ
      10. «Nukus-farm» FEZ
      11. «Zomin-farm» FEZ
      12. «Kosonsoy-farm» FEZ
      13. «Sirdaryo-farm» FEZ
      14. «Boysun-farm» FEZ
      15. «Bo‘stonliq-farm» FEZ
      16. «Parkent-farm» FEZ
      17. «Andijon-farm» FEZ
      18. «Chorvoq» FEZ
      19. «Baliq ishlab chikaruvchi» FEZ
      20. «Sirdaryo» FEZ
      21. «Buxoro-agro» FEZ
      22. «Chirokchi» FEZ

      (link: sez.gov.uz );

3.List of small industrial zones

1.                     “Nukus Technopark” SIZ

2.                      “Ayritom” SIZ

3.                       “Afrosiyob” SIZ

4.                      “Pakhtaobod” SIZ

5.                      “Telov” SIZ

6.                      “Maxam Chirchik” SIZ

7.                      “Almazar” SIZ

8.                      “Biochime” SIZ

9.                       “Farovon” SIZ

10.                 “Avtokhizmat” SIZ

11.                 “Pitnak KUSH” SIZ

12.                 “Shovot Bearing” SIZ

13.                 “Arablar” SIZ

14.                  small industrial zones of the Andijon region

15.                 small industrial zones of the Bukhara region

16.                 small industrial zones of the Jizzax region

17.                  small industrial zones of the Qashqadaryo region

18.                 small industrial zones of the republic of Karakalpakstan

19.                 small industrial zones of the Navoiy region

20.                 small industrial zones of the Namangan region

21.                 small industrial zones of the Samarqand region

22.                  small industrial zones of the Syrdaryo region

23.                  small industrial zones of the Surkhandarya region  

24.                 small industrial zones of the Toshkent region

25.                 small industrial zones of the Fergana  region

26.                  small industrial zones of the Khorazm region

27.                 “Zomin-Pharm” SIZ

 

 

https://davaktiv.uz/uz/kszlists

 

4.Benefits and preferences in the territory of special economic zones

In accordance with the Tax Code of the Republic of Uzbekistan (Chapter 68) and the Law of the Republic of Uzbekistan “On Special Economic Zones” and Decree of the President of the Republic of Uzbekistan No. PF-4853 dated October 26, 2016, in special economic zones, zone participants are provided with some tax and customs benefits.

Benefits on tax and customs payments are provided for a period of 3 to 10 years. Enterprises with foreign investment and participants in the Free Economic Zone (EEZ) are exempt from paying property tax, land tax and tax for the use of water resources, depending on the size of the investment:

  • from 300 thousand dollars to 3 million dollars – for a period of 3 years;
  • from $3 million to $5 million – for a period of 5 years;
  • from $5 million to $10 million – for a period of 7 years;
  • From 10 million dollars and above – for a period of 10 years.

SEZ participants are exempted from paying income tax depending on the volume of their investments:

  • From $ 3 million to $ 5 million-for a period of 3 years;
  • From $ 5 million to $ 15 million-for a period of 5 years;
  • From 15 million dollars and higher-for a period of 10 years.

In addition, FEZ participants have the right to defer payment of value added tax when importing goods for up to 120 days.

Customs benefits for FEZ participants are exempt from payment of the following customs duties (except for customs clearance fees) when imported into the territory of the Republic of Uzbekistan:

  • construction materials for the implementation of the investment project in accordance with   the investment contract during the construction period;
  • raw materials, materials and components used for the production and sale of products for     export, as well as their analogues, technological    equipment not produced in the          Republic of Uzbekistan according to the     approved list (the list is approved by a          resolution of the Cabinet of               Ministers of the Republic of Uzbekistan). (DCM No. 352 of the Republic of Uzbekistan dated 04.06 .2021).

The state ensures guaranteed connection of participants of free economic zones to engineering and communication networks, promptly connecting them to production sites.

5.The procedure for consideration and approval of investment projects in the territory of special economic zones
 

 

The selection of investment projects for placement in the FEZ is carried out in accordance with the Regulations on the procedure for the selection of investment projects for placement on the territory of the FEZ and registration of participants of the FEZ (hereinafter – the Regulation), approved by the resolution of the Cabinet of Ministers of January 16, 2018 No. 29.

The decision by the administrative councils to implement the project on the territory of free economic zones is carried out only if there is a positive conclusion of the State Unitary Enterprise “Center for Comprehensive Expertise and Import Contracts under the Ministry of Economy and Industry of the Republic of Uzbekistan” (hereinafter – the Center) on business plans or feasibility studies of ongoing projects;

The period for the center to issue an opinion on business plans of implemented projects or their feasibility study should not exceed twenty calendar days. The period for consideration of investment orders by administrative councils for the location of production facilities on the territory. The conclusion of the center together with the issuance process should not exceed thirty calendar days.

The investor submits to the FEZ directorate a completed investment order for the placement of an investment project on the territory of the FEZ, to which are attached:

  • information about the registration of a legal entity (investor) or other          document    confirming the activities of this investor;
  • business plan of the proposed investment project;
  • information confirming the investor’s experience in the relevant field and/or implementation of similar projects. If the investor does not have experience in the          relevant field and/or the implementation of a similar investment project, the investor          provides the Directorate with information about technology partners involved in   the           implementation of the investment project;
  • information about the investor’s financial activities over the past three years.

All documents are submitted by the investor to the Directorate with translation in the state or Russian language certified in the prescribed manner. The investor is responsible for the accuracy of the information and documents submitted.

The Administrative Council considers the submitted investment applications and business plans and, based on the results, makes a decision on the possibility of implementing the project on the territory of the FEZ or on the need to finalize the submitted documents or the inexpediency of the investment project implementation on the territory of the FEZ.

The business plan submitted to the Directorate should reflect the following basic information:

  • information about the organization of a legal entity (hereinafter – the applicant) or its founders, their experience in the relevant field and in implementation of a similar investment project;
  • the number of jobs created indicating the sources of hiring personnel (local – college graduates, persons sent by the labor exchange, employees of other organizations, and involvement of specialists from abroad);
  • the name, specificity and volumes of products planned for production;
  • estimated prices and markets for products, indicating the volume of supplies to domestic and foreign markets;
  • marketing research of internal and external sales markets of planned products;
  • availability of raw materials and a guaranteed opportunity of providing raw materials for the period of the investment project implementation, with a separate indication of local and imported materials, components;
  • calculations of the level of localization of production and changes in the commodity position of the final product according to the code of the commodity nomenclature of foreign economic activity of the Republic of Uzbekistan (code on CN FTA version 2017) compared with the initial raw material at the level of one of the first 4 characters;
  • logistics and transportation of necessary for the production of resources and finished products;
  • necessary volumes and parameters of engineering and communications support (electricity, natural gas, drinking and industrial water, sewage, road) for the implementation of the investment project and the stable operation of production;
  • the presence of industrial emissions, indicating the types and volumes of gases, solid and liquid waste;
  • the estimated size of the required area for the rational placement of production;
  • a preliminary scheme for placement of production indicating the location of the main production workshop, equipment and production line, administrative building, storage and other auxiliary premises;
  • description of the production technology (taking into account environmental requirements) with a list of technological equipment, manufacturers, suppliers and countries;
  • characteristics of the technological equipment to be used in production, as well as the management system used in the investment project that meets international standards;
  • estimated volumes, type and terms of making investments, sources of financing and estimated collateral in case of attracting a loan;
  • financial and economic calculations and indicators of the economic efficiency of the investment project.
  • The Directorate within 2 working days considers the submitted investment application and the documents attached thereto for compliance with the requirements of paragraphs 6 and 7 of the Regulation of the Cabinet of Ministers of 16.01.2018. No. 29

Investment applications filed in violation of the requirements of paragraphs 6 and 7 of the Regulation of the resolution of the Cabinet of Ministers of 16.01.2018. No. 29, returned to the investor without consideration, indicating the identified deficiencies.

6.Presentation of special economic zones