Document from CIS Legislation database © 2003-2020 SojuzPravoInform LLC

Approved by the Law of the Republic of Uzbekistan of December 25, 2007, No. ZRU-136

TAX CODE OF THE REPUBLIC OF UZBEKISTAN

(as amended on 10-03-2020)

General part

Section I. General provisions

Chapter 1. Basic provisions

Article 1. The relations regulated by the Tax code of the Republic of Uzbekistan

This Code governs the relations on establishment, introduction and cancellation, calculation and tax payment and charges, and also the relations connected with execution of the tax liabilities.

Article 2. Tax legislation

The tax legislation consists of of this Code and other regulatory legal acts which adoption is directly provided by this Code.

If the international treaty of the Republic of Uzbekistan establishes other rules, than those which are provided by the tax legislation of the Republic of Uzbekistan then are applied rules of the international treaty.

Article 3. Recognition of regulatory legal acts or their parts, not corresponding to provisions of this Code

The regulatory legal act or its part is recognized not to relevant provisions of this Code if concerning this act one of the following conditions is carried out at least:

1) it is accepted by the body which does not have the right to adopt such acts according to this Code or accepted with violation of established procedure of adoption of regulatory legal acts;

Cancels 2) or limits the rights of subjects of the tax relations provided by this Code;

3) changes the bases established by this Code, conditions, the sequence or operations procedure of subjects of the tax relations;

Resolves 4) or allows the actions forbidden by this Code;

5) otherwise contradicts regulations or sense of provisions of this Code.

The body which adopted the regulatory legal act which is not corresponding to this Code or its higher bodies has the right to cancel it or to make necessary changes to it. In case of refusal of these bodies to cancel or make necessary changes to the regulatory legal act which is not corresponding to this Code it can be nullified by court.

The regulatory legal act or its part is recognized not corresponding to this Code from the date of their acceptance.

Article 4. Action of the tax legislation in time

The taxation is made according to the legislation existing at the time of emergence of the tax liabilities if other is not provided by this Article.

Acts of the tax legislation have no retroactive force and are applied to the relations which arose after their introduction in action if other is not provided by this Article.

The acts of the tax legislation eliminating or mitigating responsibility for violation of the tax legislation have retroactive force.

The acts of the tax legislation providing cancellation of taxes and fees, decrease in rates of taxes and fees, cancellation of obligations or mitigation otherwise of provision of the taxpayers, except as specified, provided by part three of this Article can have retroactive force if it is directly provided in acts of the tax legislation.

The acts of the tax legislation providing establishment of new taxes and fees become effective not earlier than three months from the date of their official publication. In similar procedure the acts of the tax legislation providing cancellation of tax benefits, introduction of new obligations, toughening of measures of responsibility for violation of the tax legislation or other deterioration of the situation of subjects of the tax relations become effective.

The acts of the tax legislation providing change of rates of taxes and fees become effective from the first day of the month following after month of their official publication if in them later term is not specified.

The acts of the tax legislation which are not specified in parts five and the sixth this Article become effective from the date of their official publication if in acts later term is not specified.

Article 5. Procedure for calculation of the terms established by the tax legislation

The terms established by the tax legislation are determined calendar date, specifying on event which shall step, or on action which shall be made, or the expiration of period of time which is estimated for years, quarters, months or days.

The day following calendar date or event which shall come is considered the beginning of calculation of the term established by the tax legislation.

The term estimated for years expires in the corresponding month and number of the last year of term. At the same time any period of time consisting of twelve months of the following in a row, except for calendar year is recognized year.

The term estimated quarters expires in the corresponding day of the last month of term. At the same time quarter is considered to equal three calendar months, and counting of quarters is conducted since the beginning of calendar year.

The term estimated for months expires in the corresponding number of the last month of term.

If the termination of term falls on month in which there is no corresponding number, term expires in the last day of this month.

The term estimated in the days is estimated in the working days if it is not established in calendar days. At the same time day which is not recognized according to the legislation in the output and (or) non-working holiday is considered the working day.

If the last day of term falls on the day recognized according to the legislation day off and (or) in the non-working day in the afternoon of the termination of term the working day following day off and (or) in the non-working day is considered.

Action for which making the fixed term, can be executed till 24 o'clock the last day of term.

If documents or money were handed over in the organization of communication till 24 o'clock the last day of term, term is not considered passed.

Article 6. Application of international treaties of the Republic of Uzbekistan on the taxation

Application of international treaties of the Republic of Uzbekistan on the tax matters and general regulations of the international tax law is performed according to the procedure, established by this Article.

Provisions of the international treaty regulating questions of avoidance of double taxation and prevention of tax avoidance, one of the parties of which is the Republic of Uzbekistan, are applied to tax residents of one or both states which signed such agreement.

Provisions of part two of this Article do not extend to the tax resident of the state with whom the international treaty of the Republic of Uzbekistan is signed if the tax resident uses provisions of this international treaty for the benefit of other person who is not the tax resident of that state with whom this international treaty is signed.

Provisions of parts five - the twelfth this Article are applied to determination of person having the actual right to the income from payment source according to the international treaty of the Republic of Uzbekistan.

Person having the actual right to the income paid by the legal entity person who has the right independently to use and dispose of this income, or person for the benefit of whom the other person is competent to dispose of such income is recognized. At the same time does not matter, there was this right owing to direct and (or) indirect participation in this legal entity or control over it or owing to other circumstances.

In similar procedure person having the actual right to the income of structure without formation of legal entity is determined.

In case of determination of person having the actual right to the income the functions which are carried out by persons specified in part five of this Article and also the risks accepted by them are considered.

The foreign person is not recognized having the actual right to the income from sources in the Republic of Uzbekistan if it has limited powers concerning the order this income, performs concerning the specified income mediatorial functions for the benefit of the other person, without performing any other functions and without assuming any risks, directly or indirectly paying such income (fully or partially) to this other person.

In case of payment of the income from sources in the Republic of Uzbekistan to the foreign person who does not have the actual right to such income if the source of payment knows person having the actual right to such income (their part), the taxation of the paid income it is made in the following procedure:

1) if person having the actual right to the paid income (their part) is tax resident of the Republic of Uzbekistan, the taxation of the paid income (its part) is made according to provisions of this Code concerning tax residents of the Republic of Uzbekistan. At the same time the source of payment does not hold tax concerning the paid income (their part) on condition of informing tax authority by it in the place of the accounting. The procedure for such informing is determined by the State Tax Committee of the Republic of Uzbekistan;

2) if person having the actual right to the paid income (their part) is tax resident of the state (territory) with whom there is existing international treaty of the Republic of Uzbekistan on the tax matters, provisions of the specified international treaty are applied to the taxation of the paid income (their part).

The specified rules are applied provided that the place of permanent finding of person to which the income is paid and which has no actual right to this income is the state (territory) with which there is existing international treaty of the Republic of Uzbekistan on the tax matters.

If the place of permanent finding of person to which the income is paid and which has no actual right to them is the state (territory) with which there is no existing international treaty of the Republic of Uzbekistan on the tax matters, the tax at source of payment keeps on the tax rates established by this Code. On the same tax rates the tax at source of payment keeps if such income is paid to person who has no actual right to them and who does not know what tax resident of the state (territory) is person having the actual right to this income (their part).

The competent authority determined in the international treaty from the Republic of Uzbekistan according to provisions of the international treaty of the Republic of Uzbekistan has the right to request competent authority of foreign state about assistance performed by the taxpayer of foreign state of the tax liability, unexecuted in the Republic of Uzbekistan.

Article 7. Principles of the taxation

The taxation is based on the principles of obligation, definiteness and cooperation of tax authorities with taxpayers, justice, unities of the taxation system, publicity and presumption of correctness of the taxpayer.

Article 8. Principle of obligation

Each person shall pay the taxes and the charges provided by it established by this Code.

To anybody the obligation cannot be assigned to pay the taxes and fees having all signs of taxes and fees, but which are not provided by this Code or established with violation of its regulations.

Article 9. Principle of definiteness of the taxation and cooperation of tax authorities with taxpayers

The acts of the tax legislation establishing taxes and fees shall determine taxpayers and all other elements of these taxes and fees, including terms and procedure for their payment if other is not provided by this Code.

Within the tax relations tax authorities shall cooperate with taxpayers for the purpose of the correct execution of the tax legislation. At the same time tax authorities have no right to create unreasonable obstacles of legal activities of taxpayers, and taxpayers shall create conditions for implementation of the powers by tax authorities.

Article 10. Concept of justice

Taxes and fees cannot have discrimination nature and be applied proceeding from social, racial, national, religious and other similar criteria.

It is not allowed to establish graduated tax rates, tax benefits or other benefits depending on pattern of ownership, nationality of physical persons or country of source of the capital.

It is not allowed to establish the taxes interfering realization by citizens of the constitutional rights.

Article 11. Principle of unity of the taxation system

The taxation system is single in all territory of the Republic of Uzbekistan.

It is not allowed to establish the taxes breaking common economic space of the Republic of Uzbekistan, in particular, directly or indirectly the limiting free movement of goods (services) or financial resources within the territory of the Republic of Uzbekistan.

Article 12. Principle of publicity

Acts of the tax legislation are subject to obligatory official publication.

The acts of the tax legislation published officially involve consequence in law as not become effective.

Article 13. Principle of presumption of correctness of the taxpayer

All ineradicable contradictions and ambiguities of acts of the tax legislation are interpreted for benefit of the taxpayer.

Article 14. Economic contents of transactions and their legal registration

For the purpose of the taxation all transactions and other economic relations which the taxpayer enters shall be considered proceeding from their valid economic content irrespective of method of their legal registration or the name of the agreement.

If legal execution of the transaction or the economic relations does not correspond to their valid economic content, tax authorities for the purpose of the taxation have the right to change legal qualification of the transaction, the status of the taxpayer and (or) nature of its economic activity.

For the purpose of the taxation imaginary (feigned) deals are not considered. If such transactions cover other transactions, then for calculation of taxes economic content and results of the actual transactions are considered.

If all participants of transactions or other economic relations satisfy all conditions and requirements of the agreements signed by them, the separate abuses of regulations provided by the regulatory legal acts governing the non-tax relations cannot form the basis for refusal in recognition of income gained by the taxpayer or expenses (losses) incurred by it for the purpose of the taxation.

If the taxpayer makes transactions or the sequences of transactions which single or preferential purpose is receipt of unreasonable tax benefit in the form of failure to pay or reduction of the amount of payable taxes, its such actions for the purpose of of this Code are recognized abuse of the right.

Abuse of the right the scheme on reduction of the amounts of taxes where such reduction is the direct or indirect purpose either the investigation, or one of the purposes or the investigations is also recognized, and this purpose or the investigation are not minor. Reduction of the amounts of taxes includes direct or indirect change of scope of the taxation, use of tax benefits or other reduction of the amount of taxes which is subject to payment.

In cases of abuse of the right tax authorities in case of determination of the amounts of the taxes which are subject to payment by the taxpayer having the right not to take the separate transactions or the sequence of transactions into account having signs of abuse of the right. Also tax authorities have the right to adjust the amounts of payable taxes so that to exclude influence of such abuse.

Establishment of cases of abuse of the right, ostensibilities (pritvornost) of the transaction specified in this Article, and also application of their consequences is performed by tax authorities, and in case of disagreement of the taxpayer - court in the claim of tax authorities.

Article 15. Due discretion

In the tax relations taxpayers shall show due discretion in case of the choice of partners, checking availability of their registration in tax authorities as taxpayers, goodwill, availability of production base and personnel, financial condition, capability to fulfill obligations according to the transaction.

Expenses (losses) incurred by the taxpayer according to transactions with persons which did not fulfill the obligations to it for the purpose of the taxation are not recognized if this taxpayer in case of the conclusion of the transaction did not show due discretion.

Tax authorities provide to taxpayers information access about statement of partners on accounting in tax authorities as taxpayers, and also to other information according to the procedure, determined by the State Tax Committee of the Republic of Uzbekistan.

Chapter 2. System of taxes and fees in the Republic of Uzbekistan

Article 16. Taxes and fees

The tax is understood as the obligatory non-paid payment established by this Code paid to the Government budget of the Republic of Uzbekistan or to the state trust fund (further - the budget system).

Collection is understood as the obligatory payment established by this Code or other acts of the legislation in the budget system which payment is one of making conditions concerning the payer of this collection by authorized body or its official of legally significant actions, including provision of certain rights or issue of allowing documents.

The penalties and other payments assigned to person judicially and also confiscations and other withdrawals of property in the cases established by the law do not belong to taxes or charges.

Article 17. Types of tax and charges

In the territory of the Republic of Uzbekistan the following taxes are established:

1) value added tax;

2) excise tax;

3) income tax;

4) income tax;

5) tax for use of natural resources;

6) tax for use of water resources;

7) property tax;

8) land tax;

9) social tax.

In the territory of the Republic of Uzbekistan charges can be established. The procedure for introduction, calculation and payment of charges is determined by this Code and other acts of the legislation.

This Code regulates procedure for calculation and payment of motor transportation collection.

The procedure for calculation and collection of the state fee is established by the legislation on the state fee.

Article 18. Special tax regimes

For separate categories of taxpayers in the territory of the Republic of Uzbekistan the following special tax regimes are set:

1) receipts tax;

2) special procedure for the taxation of agreement parties about the Section of products;

3) special procedure for the taxation of participants of special economic zones and separate categories of taxpayers.

The special procedure for the taxation of participants of special economic zones and separate categories of taxpayers is established for certain term depending on the performed investments and accomplishment of other conditions, stipulated by the legislation or investment agreements.

Special tax regimes can provide exemption of separate taxes, application of the lowered tax rates and other tax benefits.

Chapter 3. Subjects of the tax relations, their rights and obligation

Article 19. Subjects of the tax relations and procedure for exchange of documents

Subjects of the tax relations are taxpayers, tax agents and authorized bodies.

Tax authorities, in the cases provided by this Code send to the taxpayer documents in the form of the electronic document to personal office of the taxpayer. Directed documents are considered received after their reading by the taxpayer, but no later than three days from the date of departure.

If the taxpayer has no personal office of the taxpayer, documents go by mail the registered mail and are considered received in five days after their departure.

Documents can be handed to the taxpayer or his representative personally under the signature with indication of the date of receipt of the specified documents.

Taxpayers in the cases provided by this Code send to tax authorities documents according to the procedure, similar specified in parts two - the fourth this Article. At the same time such documents are considered as the received tax authorities in day of sending in case of the direction of documents through personal office of the taxpayer, in five days - in case of the direction of documents by mail.

Document forms, provided by this Code, the documents necessary for providing electronic document management, procedure for filling of forms of the specified documents, procedure for the direction and receipt of such paper documents or electronically on telecommunication channels or through personal office of the taxpayer affirm the State Tax Committee of the Republic of Uzbekistan.

Article 20. Taxpayers

Taxpayers legal entities and physical persons on which according to this Code the obligation is assigned are recognized to pay the established taxes and fees.

In cases and according to the procedure, the provided by this Code, separate divisions of legal entities fulfill duties of these persons on tax payment and charges in the location of these separate divisions.

The taxpayers referred to category of large taxpayers provide tax statements and pay taxes (charges) on a centralized basis taking into account separate divisions.

In the cases provided by this Code, taxpayers foreign structures without formation of legal entity are recognized.

Article 21. Rights of taxpayers

Taxpayers have the right:

receive free of charge from tax authorities and other authorized bodies (within their powers) information on the operating taxes, on changes in the tax legislation, on procedure for calculation and tax payment, form of tax statements and statements, and also explanations about procedure for their filling;

obtain the data on execution of the tax liabilities which are available in tax authorities and other authorized bodies;

use tax benefits in the presence of the bases and according to the procedure, established by this Code, or refuse their use;

on timely offsetting or return of the amounts of excessively paid or excessively collected taxes, penalty fee and penalties;

receive delay or payment by installments on tax payment according to the procedure and on the conditions established by this Code;

to independently correct the mistakes made by them during the accounting of the taxation objects, calculation and tax payment;

be present at the conducting exit tax audit and tax audit which are carried out in their territory according to this Code;

get acquainted with materials of exit tax audit and tax audit, and also receive acts of these checks;

represent to the tax authorities performing tax audit, explanations on the questions concerning execution of the tax legislation;

not fulfill the requirements of tax authorities and other authorized bodies and their officials which are not corresponding to this Code and (or) other acts of the tax legislation;

appeal in accordance with the established procedure acts of substandard nature and the decision of tax authorities and other authorized bodies, actions (failure to act) of their officials;

require in accordance with the established procedure indemnification, tax authorities and other authorized bodies caused by illegal decisions or illegal actions (failure to act) of their officials;

participate in process of consideration of materials of tax audit or other acts of tax authorities in the cases provided by this Code;

represent the interests concerning the tax relations personally or through the organization of tax consultants or other representatives;

on observance and preserving tax secret.

Taxpayers can have also other rights established by this Code and other acts of the tax legislation.

Personal participation of the taxpayer in the tax relations does not deprive of it the right to have the representative, is equal as participation of the representative does not deprive of the taxpayer of the right to personal participation in the specified relations.

The rights of taxpayers are provided with the corresponding obligations of officials of tax authorities and other authorized bodies.

Non-execution or improper execution of obligations on providing the rights of taxpayers attracts responsibility, stipulated by the legislation the Republic of Uzbekistan.

Article 22. Obligations of taxpayers

Taxpayers shall:

timely and in full to estimate and pay the established taxes and fees;

be in tax authority in case of receipt of the agenda about need of consideration of documents or making explanations;

in case of sales of goods (services) to provide to the buyer of the invoice, checks or other documents equated to them;

provide access for officials of the tax authorities which are carrying out tax audit for acquaintance with the documents forming the basis for calculation and tax payment, and also the relevant information which is stored on electronic media;

fulfill legal requirements of tax authorities and other authorized bodies, not interfere with legal activities of the specified bodies and their officials;

ensure safety of tax statements and other documents necessary for calculation and tax payment, within five years following after the calendar year established for payment of the corresponding taxes if other is not provided by this Code;

inform tax authorities in the place of the tax accounting on participation in legal entities of the Republic of Uzbekistan and foreign legal entities if share exceeds 10 percent of authorized fund (authorized capital).

Taxpayers - legal entities, in addition to the obligations provided by part one of this Article shall report to tax authorities in the place of the accounting about all the separate divisions and changes in earlier reported data on separate divisions within one month from the date of creation of separate division or change of the specified data.

Persons to whom this Code assigns obligation to represent tax statements electronically, shall provide from tax authority electronically on telecommunication channels of documents which are used by tax authorities in case of realization of the powers in the relations regulated by the tax legislation.

The foreign legal entities having the real estate according to this Code recognized by the taxation object in addition to the obligations provided by this Article shall report in the cases and procedure provided by this Code in tax authority in the location of the real estate unit of the information about members of this foreign legal entity. Foreign structures without formation of legal entity in the specified circumstances shall report data on the founders, beneficiaries and managing directors. In the presence at the foreign legal entity (foreign structure without formation of legal entity) several objects of the property specified in this part, the message is submitted in tax authority in the location of one of property objects at the choice of this person.

The taxpayers paying taxes in connection with movement of goods through customs border of the Republic of Uzbekistan also perform the duties provided by the customs legislation of the Republic of Uzbekistan.

Taxpayers can perform also other duties according to the legislation.

Article 23. Tax agents

Tax agents persons to whom according to this Code obligations on calculation, deduction at the taxpayer and to transfer of taxes in the budget system are assigned are recognized.

Tax agents have the same rights, as taxpayers if other is not provided by this Code.

Tax agents shall:

correctly and timely to estimate, hold and list taxes in the budget system;

report in writing or electronically in tax authorities about impossibility to hold tax and the amount of tax debt of the taxpayer within one month from the date of when the tax agent knew of such circumstances;

keep personally on each taxpayer account of the added and paid income estimated withheld and listed in the budget system of taxes;

submit to tax authorities the documents necessary for control of correctness of calculation, deduction and transfer of taxes;

ensure safety of tax statements and other documents necessary for calculation, deduction and transfer of taxes, during the term of limitation period, stipulated in Article 88th of this Code.

Tax agents can perform also other duties according to the legislation.

Article 24. Representatives of the taxpayer

The taxpayer has the right to participate in the tax relations through the legal or authorized representative if other is not provided by this Code.

Powers of the representative shall be documented according to this Code and other acts of the legislation.

Legal representatives of the taxpayer - the legal entity persons, representatives are recognized to represent this legal entity based on the law or its constituent documents.

Legal representatives of the taxpayer - physical person persons acting as his representatives according to the civil legislation are recognized.

The actions (failure to act) of legal representatives of the legal entity made in connection with participation of this legal entity in the tax relations are actions (failure to act) of this legal entity.

The organizations of tax consultants can be authorized representatives of the taxpayer or the other persons in accordance with the established procedure authorized by the taxpayer to represent its interests in the relations with tax authorities, customs authorities and other participants of the tax relations.

The authorized representative of the taxpayer - the legal entity performs the powers based on the signed agreement or the power of attorney issued according to the procedure, established by the civil legislation if other is not provided by this Code.

The authorized representative of the taxpayer - physical person performs the powers based on notarially certified power of attorney according to the civil legislation.

Officials of tax, financial, customs and other state bodies cannot be authorized representatives of the taxpayer.

The responsible member of the consolidated group of taxpayers is the authorized representative of all members of the consolidated group of taxpayers based on the law.

Irrespective of provisions of the agreement on creation of the consolidated group of taxpayers the responsible participant of this group has the right to represent the interests of participants of the specified consolidated group in the following legal relationship, connected:

with registration in tax authorities of the agreement on creation of the consolidated group of taxpayers, and also with change of the specified agreement, the decision on prolongation of the duration of the agreement and its termination;

with recovery by enforcement from the member of the consolidated group of taxpayers of debt on the income tax on the consolidated group of taxpayers;

on nature of the actions (failure to act) made by the official of tax authority when they directly affect the rights of the legal entity who is the member of the consolidated group of taxpayers.

Upon termination of effective period, in case of early termination or termination of the contract about creation of the consolidated group of taxpayers person who was the responsible participant of this group keeps the powers provided by parts ten and the eleventh this Article.

Persons who are the responsible member of the consolidated group of the taxpayers having the right to delegate the powers conferred to them by this Code on representation of interests of participants of this group to the third parties based on the signed agreement or the power of attorney issued according to the procedure, established by the legislation.

Article 25. Authorized bodies

Authorized bodies are:

tax authorities - the State Tax Committee of the Republic of Uzbekistan, Interregional state tax authorities on large taxpayers, the State Tax Administrations of the Republic of Karakalpakstan, areas and the city of Tashkent, and also the state tax authorities of areas (cities);

customs authorities - the State Customs Committee of the Republic of Uzbekistan, management of the State Customs Committee on the Republic of Karakalpakstan, areas, the city of Tashkent, the specialized customs Tashkent-AERO complex and customs posts;

the state bodies and the organizations performing functions on collection of charges.

Article 26. Rights of tax authorities

Tax authorities have the right:

demand from taxpayers and the third parties to submit documents and data (information), including in electronic form, necessary for calculation and tax payment and charges;

carry out tax audits and other tax control measures according to the procedure, established by this Code;

survey the territory, production, storage, trade and other facilities, including the places used by the taxpayer for extraction of the income or connected with content of the taxation objects;

make inventory count of property and control measurements of the performed works, the rendered services;

in cases, stipulated by the legislation to seal cash desks and storage locations of inventory items and documents for the term of no more than two days, and for the term of more than two days - by a court decision;

make seizure of documents and the electronic media of information connected with calculation of taxes and fees;

perform photo and video filming, receive explanations and other data;

involve the translator, the expert and to appoint examination;

to independently determine the amounts of taxes in the settlement way based on information on the taxpayer which is available for them, and also data on other similar taxpayers in cases of loss or destruction by the taxpayer of accounting documentation;

perform tax monitoring of observance of the tax legislation, correctness of calculation, completeness and timeliness of tax payment by the taxpayer participating in tax monitoring based on the mutual agreement;

take measures of recovery by enforcement of tax debt;

consider cases on tax offenses and apply financial sanctions;

in accordance with the established procedure to turn into the income of the state inventory items on the elicited facts of tax offenses. The address to the income of the state of inventory items of taxpayers - legal entities and individual entrepreneurs is performed judicially;

illegal to make in courts claims to taxpayers for collection in the income of the state the means received by them;

require the translation of documents on state language;

cause based on the written notice in tax authorities of taxpayers and tax agents for making explanations in connection with payment (deduction and transfer) of taxes by them or in connection with tax audit, and also in other cases connected with execution of the tax legislation by them;

stop transactions according to bank accounts of the taxpayer or tax agent and impose arrest their property according to the procedure, provided by this Code;

demand from taxpayers and their representatives, tax agents of elimination of the revealed violations of the tax legislation and control accomplishment of the specified requirements;

control execution by banks of the obligations established by this Code.

Tax authorities can perform also other rights in compliance the law.

Article 27. Obligations of tax authorities

Tax authorities shall:

observe the tax legislation;

exercise control of observance of the tax legislation, correctness of calculation, completeness and timeliness of tax payment and charges;

provide the complete and timely taxpayer registration, the taxation objects and objects connected with the taxation, accrued and the paid taxes;

report to taxpayers about their rights and obligations when conducting tax audits, and also to inform on results performed;

to timely publish acts of the tax legislation on the official website of the State Tax Committee of the Republic of Uzbekistan;

render assistance to taxpayers performed by the tax legislation, explain regulations of the tax legislation and procedure for application of tax benefits;

carry out the analysis and assessment of the facts of violation of the tax legislation, to make offers on elimination of the reasons and conditions promoting tax offenses in the relevant state bodies;

develop and realize long-term and current programs of fight against tax offenses together with law enforcement agencies;

study statements, messages and other information about violations of the tax legislation;

control behind completeness and timeliness of cash receipt from realization of the property turned into the income of the state;

transfer to law enforcement agencies materials on the facts of violation of the tax legislation in cases when the solution of question goes beyond powers of tax authorities;

within the powers to exercise control of observance of established procedure of making currency and export-import transactions;

observe tax secret and ensure its safety;

upon the demand of the taxpayer to draw up the reconciliation statement of execution of the tax liability on tax payment;

collect in indisputable procedure for the amount of tax debt according to this Code;

perform registration of legal entities and physical persons, including nonresidents of the Republic of Uzbekistan, appropriate them identification taxpayer numbers and to officially report them to statistical and registering bodies;

upon the demand of the taxpayer to issue the reference confirming him registration in tax authorities;

be guided by written explanations of the Ministry of Finance of the Republic of Uzbekistan concerning application of the tax legislation.

Tax authorities can perform also other duties according to the legislation.

Article 28. The rights and obligations of the customs authorities, state bodies and organizations performing functions on collection of charges

Customs authorities have the rights and perform duties on collection of taxes and charges when moving goods and vehicles through customs border of the Republic of Uzbekistan according to the customs legislation, this Code and other acts of the legislation.

The rights and obligations of the state bodies and organizations performing functions on collection of charges are regulated by this Code and other acts of the legislation.

Article 29. Tax secret

The information about the taxpayer received by authorized bodies, except for the data is tax secret:

1) public, including become those with the consent of their owner;

2) about identification taxpayer number;

3) about violations of the tax legislation and measures of responsibility for these violations;

4) about the tax regimes applied by taxpayers and statement on registration accounting as taxpayers of the value added tax;

5) about the amounts of the paid taxes and tax debt;

6) about members of the legal entity;

7) about the average number of workers;

8) about the amounts of the income and expenses according to the financial reporting.

The tax secret is not subject to disclosure by state bodies, their officials involved by specialists and experts, except as specified, stipulated by the legislation.

Use or transfer to other person of the information which is trade secret (know-how) of the taxpayer and became known to the official of state body involved to the specialist or the expert in case of execution of the obligations by them belongs to disclosure of tax secret, in particular.

Provision to tax or other relevant organs of other states according to international treaties of the Republic of Uzbekistan of required information about the taxpayer does not belong to disclosure of tax secret.

The data which arrived in state bodies being tax secret have the special mode of storage and access.

The officials determined by the State Tax Committee of the Republic of Uzbekistan have access to the data which are tax secret.

Loss of the documents containing the data which are tax secret or disclosure of such data attracts the responsibility provided by the law.

Provisions of this Article extend to the data received by the organizations subordinated to the State Tax Committee of the Republic of Uzbekistan performing input and data processing about taxpayers and also on employees of the specified organizations.

Chapter 4. The basic concepts applied in this Code

Article 30. Physical persons

Physical persons are citizens of the Republic of Uzbekistan, citizens of foreign states, and also stateless persons.

Tax residents of the Republic of Uzbekistan the physical persons which are actually in the Republic of Uzbekistan in total more than hundred eighty three calendar days during any consecutive twelve-monthly period which is beginning or coming to an end in that tax period in relation to which the corresponding status is determined are recognized.

Provisions of part two of this Article are applied taking into account the features established by this Article and provisions of international treaties of the Republic of Uzbekistan on the tax matters.

The physical person is also recognized the tax resident of the Republic of Uzbekistan if in the corresponding tax period it was in the Republic of Uzbekistan in total less than hundred eighty three days, but more, than it was in any other state.

The physical person according to its statement in tax authorities can be acknowledged tax resident of the Republic of Uzbekistan before the expiration of the twelve-monthly term specified in part two of this Article if this person submits the long-term labor contract or other document confirming accomplishment of the conditions provided by parts two - the fourth this Article.

The period of the actual finding of physical person in the Republic of Uzbekistan is not interrupted for the periods of its departure out of limits of the territory of the Republic of Uzbekistan for short-term (less than six months) treatment or training.

For the purpose of this Article time during which the citizen of foreign state or the stateless person stayed does not belong by the time of the actual stay in the Republic of Uzbekistan:

1) as person having the diplomatic or consular status;

2) as the employee of the international organization created according to the international treaty which participant is the Republic of Uzbekistan;

3) as the member of the family of persons specified in Items 1 and 2 of this part provided that such person did not perform business activity.

Irrespective of the actual time spent the military personnel of the Republic of Uzbekistan serving abroad and also the staff of public authorities sent for work out of limits of the Republic of Uzbekistan are recognized the Republic of Uzbekistan tax residents of the Republic of Uzbekistan.

For confirmation of the actual stay in the territory of the Republic of Uzbekistan day of entry (departure) into the Republic of Uzbekistan (from the Republic of Uzbekistan) is determined based on mark about crossing of frontiers of foreign states. Such mark is brought by the competent authority of the Republic of Uzbekistan and (or) foreign state exercising border control in identity documents, and (or) documents for entry (departure) into the Republic of Uzbekistan (from the Republic of Uzbekistan). Also actual finding of person in the territory of the Republic of Uzbekistan can be determined based on the information which is available in tax authority provided by state bodies and the organizations in the procedure established by the legislation.

If provisions of part nine of this Article do not allow to determine unambiguously time of the actual finding of physical person in the territory of the Republic of Uzbekistan, the physical person submits to tax authority the documents (or their copies) confirming the place of its actual stay within calendar year (years) and also any other documents (or their copies) which can form the basis for determination of the place of its actual stay:

1) identity document;

2) permission to the temporary residence in the Republic of Uzbekistan which is drawn up in accordance with the established procedure;

3) the documents confirming the place of the actual stay.

If according to provisions of this Article or international treaties of the Republic of Uzbekistan on the tax matters at the same time there are bases for recognition of physical person both the tax resident of the Republic of Uzbekistan, and the tax resident of foreign state, the tax residence is determined according to provisions of such international treaty based on the center of vital interests of physical person. At the same time the center of vital interests of physical person is recognized being in the Republic of Uzbekistan in case of accomplishment at least of one of the following conditions:

1) the spouse (a) and (or) close relatives of physical person live in the Republic of Uzbekistan;

2) availability in the Republic of Uzbekistan of the real estate belonging on the property right or on other bases to physical person and (or) the spouse (e) and (or) his close relatives available at any time for its accommodation and (or) for accommodation of the spouse(s) and (or) his close relatives.

If the physical person has no residence in the territory of the Republic of Uzbekistan, for the purposes of of this Code the residence can be determined at the request of this physical person by the place of its stay. At the same time the place of stay of physical person is the place (address) where the physical person temporarily lives and is registered in the place of stay according to the procedure, established by the legislation of the Republic of Uzbekistan.

The physical persons who are not tax residents of the Republic of Uzbekistan are recognized nonresidents of the Republic of Uzbekistan.

Article 31. Individual entrepreneurs

Individual entrepreneur is the physical person registered in accordance with the established procedure and performing business activity without formation of legal entity.

The physical persons performing business activity without formation of legal entity, but which are not registered as individual entrepreneurs for the purpose of the taxation and application of measures of responsibility are considered as individual entrepreneurs.

Article 32. Legal entities and their separate divisions

Legal entities are:

1) the legal entities created according to the legislation of the Republic of Uzbekistan (legal entities of the Republic of Uzbekistan);

2) the foreign legal entities (including the companies and other corporate educations) having civil legal capacity, created according to the legislation of foreign states;

3) international organizations.

Separate division of the legal entity of the Republic of Uzbekistan is any division which is territorially isolated from it in which location stationary workplaces are equipped.

Recognition of separate division of the legal entity by that is made irrespective of the fact which it is given authority and is reflected or its creation is not reflected in constituent or other organizational and administrative documents of the legal entity.

The workplace is considered stationary if it is created for the term of more than one month.

The location of separate division of the legal entity of the Republic of Uzbekistan is the place of implementation by this legal entity of activities through this separate division.

Article 33. Legal entities - tax residents of the Republic of Uzbekistan. Legal entities - nonresidents of the Republic of Uzbekistan

Tax residents of the Republic of Uzbekistan are the following legal entities:

1) legal entities of the Republic of Uzbekistan;

2) the foreign legal entities recognized by tax residents of the Republic of Uzbekistan according to international treaties of the Republic of Uzbekistan on the tax matters for the purposes of application of these international treaties;

3) foreign legal entities, the place of the actual management of which is the Republic of Uzbekistan if other is not provided by the international treaty of the Republic of Uzbekistan on the tax matters.

For the purpose of Item 3 parts one of this Article the place of the actual management of the foreign legal entity is determined according to Article provisions 34 of this Code.

Recognition of managing company of investment fund (share fund or other form of implementation of collective investments) by the tax resident of the Republic of Uzbekistan is not the basis for recognition of this investment fund (share fund or other form of implementation of collective investments) the tax resident of the Republic of Uzbekistan. The same rules are applied in case of management of the managing partners or other persons specified by funds (other forms of implementation of collective investments).

The legal entities who are not tax residents of the Republic of Uzbekistan are recognized nonresidents of the Republic of Uzbekistan.

Article 34. Place of the actual management of the foreign legal entity

The Republic of Uzbekistan is recognized the place of the actual management of the foreign legal entity in case of observance at least of one of the following conditions:

1) its executive body (executive bodies) regularly performs the activities concerning this legal entity from the Republic of Uzbekistan. At the same time regular implementation of activities implementation of activities is not recognized the Republic of Uzbekistan in amount significantly smaller, than in other state (states);

2) his leading (leading) officials (persons, representatives to plan and control activities, to manage activities of the company and bearing responsibility for it) mainly exercise the leading control of this legal entity in the Republic of Uzbekistan. At the same time decision making and implementation of other actions concerning the current activities of this foreign legal entity entering competence of executive bodies, in particular, belong to the leading management.

Implementation in the Republic of Uzbekistan of the following activities does not attract recognition of the Republic of Uzbekistan by the place of the actual management of the foreign legal entity:

1) preparation and (or) decision making on the questions which are within the competence of general shareholder meeting (participants);

2) preparation for holding meeting of the Board of Directors;

3) implementation of separate functions within planning and control of activities of the foreign legal entity.

In particular, strategic planning, budgeting, preparation and creation of the consolidated financial and management reporting, the analysis of activities of this foreign legal entity, internal audit and internal control, and also adoption (approval) of standards, techniques and (or) the politician belong to implementation of separate functions.

The Republic of Uzbekistan is not recognized the place of the actual management of the foreign legal entity in case of simultaneous observance of the following conditions concerning activities of the specified foreign legal entity:

1) activities are performed in the state (in the territory) its permanent location with use of own qualified personnel and assets;

2) with foreign state in the territory of which activities are performed the Republic of Uzbekistan has the existing international treaty on the tax matters.

Accomplishment of the conditions specified in part one of this Article shall be documented.

If it is documented that the conditions established by Items 1 and (or) 2 of part one of this Article are carried out at the same time in the relation of both the Republic of Uzbekistan, and any foreign state, the Republic of Uzbekistan is recognized the place of management of the foreign legal entity if concerning it one of the following conditions is carried out at least:

1) conducting accounting or managerial accounting (except for actions for preparation and creation to the consolidated financial and management reporting, and also the analysis of its activities) is performed in the Republic of Uzbekistan;

2) record keeping is performed in the Republic of Uzbekistan;

3) operational management by personnel is exercised in the Republic of Uzbekistan.

Article 35. Foreign structures without formation of legal entity

Foreign structure without formation of legal entity is the organizational structure created according to the legislation of foreign state without formation of legal entity and having the right to perform the activities directed to commercialization (profits) for the benefit of the participants (unitholders, principals or other persons) or other beneficiaries.

Funds, partnership, partnerships, trusts, other forms of implementation of collective investments and (or) trust management, in particular, treat foreign structures without formation of legal entity.

Article 36. Permanent organization

For the purpose of of this Code permanent organization of the foreign legal entity the permanent place of activities through which this foreign legal entity fully or partially performs business activity in the Republic of Uzbekistan is recognized the Republic of Uzbekistan.

As permanent organization it is understood, in particular:

1) any place of management, branch, department, bureau, office, office, office, agency, factory, workshop, shop, laboratory;

2) place of implementation of production, conversion, picking, packing and packaging of goods;

3) any place, including warehouse used as outlet;

4) mine (mine), oil or gas well, pit or any other place of production of natural resources;

5) installation or the construction (including its installation) used for studying (investigation), development, production and (or) operation of natural resources but only provided that installation or construction is used or it is ready to use within more than hundred eighty three days;

6) any place of implementation of the activities (including control or observant) connected with the pipeline, the gas pipeline;

7) any place of implementation of the activities connected with installation, adjustment and operation of gaming machines (including prefixes), computer networks and communication channels, attractions.

Permanent organization is recognized also:

1) the building site, construction, assembly or assembly object or the related supervising (control) activities provided that such platform, object or activities exist or proceed more than hundred eighty three days during any consecutive twelve-monthly period;

2) rendering services, including consulting services, carried out by this foreign legal entity by means of the employees or other personnel hired by it for these purposes provided that such activities continue (for the same or connected project of person or the related party of the foreign legal entity) at least hundred eighty three days during any consecutive twelve-monthly period.

If one or several interconnected foreign legal entities render services on the building site or other object specified in Item of 1 part three of this Article during different periods of time, each of which separately does not exceed the term or terms specified in Items 1 and 2 of part three of this Article, then the periods of activities for such services are added to cumulative period of time during which activities on this building site or other object were performed.

Do not lead the following types of activity which have exclusively preparatory or auxiliary character to formation of permanent organization and are not part of main types of business activity of this foreign legal entity:

1) use of objects only for the purposes of storage or demonstration of the goods or products belonging to it;

2) content of the inventories of goods or products belonging to it only for the purposes of storage or demonstration;

3) content of the inventories of goods or products belonging to it only for the purposes of conversion by other person;

4) content of the permanent place of activities only for the purposes of purchase of goods, products or information collection for this foreign legal entity;

5) content of the permanent place of activities only for the purposes of implementation of any other activities of preparatory or auxiliary nature;

6) content of the permanent place of activities only for any combination of the types of activity mentioned in Items 1 - the 5th this part provided that the cumulative activities of this permanent place of activities arising from such combination have preparatory or auxiliary character. At the same time activities of preparatory and auxiliary nature shall be performed for the nonresident of the Republic of Uzbekistan, but not for the third parties.

Provisions of part five of this Article are not applied to the permanent place of business activity which is used or contains the foreign legal entity if this foreign legal entity or person interconnected with it performs business activity through this or other place in the Republic of Uzbekistan and if one of the following conditions is carried out at least:

1) this or other place forms itself permanent organization for the foreign legal entity or person interconnected with it according to provisions of this Article;

2) the cumulative activities received as a result of combination of the types of activity performed by two persons, including legal entities - nonresidents of the Republic of Uzbekistan, through the permanent place either the same nonresident or person interconnected with it through both places, have no preparatory or auxiliary nature.

Provisions of part six of this Article are applied if the business activity performed by two persons, including foreign legal entities through the permanent place by either the same person or person interconnected with it through both places, represents complementary functions within general business activity.

The foreign legal entity performing insurance activity except reinsurance cases, is recognized having permanent organization in the Republic of Uzbekistan if it collects insurance premiums in the territory of the Republic of Uzbekistan or insures against risks through the dependent agent.

If any person acts in the Republic of Uzbekistan on behalf of the foreign legal entity and usually signs contracts or plays major role in the conclusion of contracts on transfer of property (rendering services) or provision of property use right on behalf of this foreign legal entity, then activities of such person lead to formation of permanent organization of this foreign legal entity.

Provisions of part nine of this Article are not applied if the foreign legal entity performs activities in the Republic of Uzbekistan through the independent agent, the acting on the basis of the commission agreement (order) or other similar agreement and not authorized to sign contracts on behalf of this foreign legal entity. At the same time, if such agent acts mainly on behalf of one or several foreign legal entities interconnected with him, this person is considered the dependent agent.

Provision of foreign personnel for work in the territory of the Republic of Uzbekistan as the foreign legal entity to other legal entity does not lead to formation of permanent organization in the Republic of Uzbekistan in case of simultaneous accomplishment of the following conditions:

1) such personnel act on behalf and for the benefit of the legal entity to whom it is provided;

2) the legal entity who provided personnel does not bear responsibility for results of work of these personnel;

3) the income of the legal entity from provision of personnel does not exceed 10 percent from the total amount of its costs on provision of these personnel for tax period.

In case of implementation by the foreign legal entity of activities in the territory of the Republic of Uzbekistan based on cooperation agreement:

1) activities of each participant of such agreement forms permanent organization according to the provisions established by this Article;

2) execution of the tax liability is performed by each participant of such agreement independently according to the procedure, determined by this Code.

Activities of the foreign legal entity forms permanent organization according to provisions of this Article from start date of implementation of such activities in the Republic of Uzbekistan.

Start date of implementation by the foreign legal entity of activities date is recognized the Republic of Uzbekistan for the purpose of application of this Code:

1) the conclusions of any following contract (the agreement, the agreement) on:

a) rendering services in the Republic of Uzbekistan, including within cooperation agreement;

b) provision of powers on making from his name of actions in the Republic of Uzbekistan;

c) purchase of goods in the Republic of Uzbekistan for use or realization in the territory of the Republic of Uzbekistan;

d) acquisition of services for rendering services in the Republic of Uzbekistan;

2) the conclusions of the first employment contract (the agreement, the contract) for the purpose of implementation of activities in the Republic of Uzbekistan;

3) arrivals in the Republic of Uzbekistan of the physical person - the nonresident, hiring of the worker or other personnel by the foreign legal entity for the accomplishment of terms of the contract (the agreement, the agreement) specified in Items 1 or 2 of this part.

If several conditions specified in part fourteen of this Article are performed, start date of implementation of activities of the nonresident the earliest of these dates, but not earlier than come the first of the dates specified in Items 2 and 3 of part fourteen of this Article is recognized the Republic of Uzbekistan.

The foreign legal entity performing the business activity in the Republic of Uzbekistan leading to formation of permanent organization shall be registered as the taxpayer in the tax authority according to the procedure determined by article 130 of this Code.

If the foreign legal entity performs the business activity leading to formation of two and more permanent organizations which are subject to registration in one tax authority, one permanent organization in total on group of such permanent organizations is subject to registration. The specified rule does not extend to activities which forms the building site, the construction, assembly or other object specified in Item of 1 part three of this Article.

If the foreign legal entity has the registered permanent organization performing the activities specified in parts two, third or eighth this Article and performs the same or similar activities for the place other than place of registration of this permanent organization, implementation of such activities also leads to formation of the permanent organization which is subject to registration from start date of implementation of these activities.

If activities of the foreign legal entity have portable character (construction of roads, investigation of minerals and other types of activity of portable nature), in this case all project is considered as permanent organization, irrespective of its portable nature.

If after exception of permanent organization of the Unified register of taxpayers of the Republic of Uzbekistan during the twelve-monthly period the foreign legal entity resumes the activities specified in parts two or third this Article, it is recognized formed permanent organization and is subject to registration as the taxpayer from the date of renewal of such activities.

Article 37. The interconnected persons

If features of the relations between persons can exert impact on conditions and (or) results of the transactions made by them and (or) the economic results of activities of these persons or activities of persons represented by them specified are recognized interconnected for the purposes of the taxation this part of the face.

For recognition of coherence of persons influence which can appear owing to participation of one person in the capital of other persons according to the agreement signed between them, or in the presence of other possibility of one person to determine the decisions made by other persons is considered. Such influence is considered irrespective of whether there can be it one face directly and independently or together with his interconnected persons recognized by those according to this Article.

Taking into account parts one and the second this Article for the purpose of of this Code the interconnected persons are recognized:

1) legal entities if one legal entity directly and (or) indirectly participates in other legal entity and the share of such participation constitutes more than 20 percent;

2) the physical person and the legal entity if the physical person directly and (or) indirectly participates in this legal entity and share of such participation constitutes more than 20 percent;

3) legal entities if the same person directly and (or) indirectly participates in these legal entities and the share of such participation in each legal entity constitutes more than 20 percent;

4) the legal entity and person (including physical) having powers to destination (election) of sole executive body of this legal entity or appointment (election) at least 50 percent of structure of collegiate executive body or the board of directors (supervisory board) of this legal entity. In case with physical person in case of determination of its powers also joint authorities with his interconnected persons specified in Item 11 of this part are considered;

5) legal entities in whom at least 50 percent of structure of collegiate executive body or the board of directors (supervisory board) are appointed or elected according to the solution of the same face (including physical). In case with physical person in case of determination of its decisions also the decisions made together with his interconnected persons specified in Item 11 of this part are considered;

6) legal entities in whom more than 50 percent of structure of collegiate executive body or the board of directors (supervisory board) make the same physical persons. At the same time participation of the persons interconnected with it specified in Item 11 of this part is equated to participation of directly physical person;

7) the legal entity and person performing powers of its sole executive body;

8) legal entities in whom powers of sole executive body are performed by the same person;

9) legal entities and (or) physical persons if in the sequence reflecting direct participation of these persons one in another, the share of direct participation of each previous person in each subsequent legal entity constitutes more than 50 percent;

10) physical persons if one physical person submits to other physical person on official capacity;

11) physical person, his spouse (spouse), parents (including adoptive parents), parents of the spouse (spouse), children (including adopted), brothers and sisters with complete and incomplete relationship, and also the guardian (custodian) and the ward.

For the purpose of this Article of shares of participation of the physical person the legal entity cumulative share of participation of this physical person and his interconnected persons specified in Item 11 parts three of this Article is recognized the specified legal entity.

If on conditions and (or) results of the transactions made by persons and (or) on economic results of their activities there is influence by one or several other persons owing to their position of priority in the market or owing to other similar circumstances, such influence is not the basis for recognition of persons interconnected.

Direct and (or) indirect participation of the Republic of Uzbekistan in legal entities of Uzbekistan in itself is not the basis for recognition of such legal entities interconnected. The specified legal entities can be acknowledged interconnected on other bases provided by this Article.

Recognition of persons interconnected on other bases which are not provided by part three of this Article if the relations between these persons have the signs specified in parts one and the second this Article is performed by court.

Article 38. Share in the legal entity

For the purpose of the taxation share of one physical person or legal entity (further - persons) in other legal entity chosen for determination of this share (further - the chosen legal entity) is determined in the form of the amount of shares of direct and indirect participation of this person in the chosen legal entity.

Share of direct participation of person in the chosen legal entity the share of voting shares which is directly belonging to this person or the share in authorized fund (authorized capital) of the chosen legal entity which is directly belonging to this person is recognized.

If it is impossible to determine share of direct participation of person in the chosen legal entity by the specified method, that is recognized the share determined in proportion to the number of participants in the chosen legal entity.

Share of indirect participation of person in the chosen legal entity the share determined in the following procedure is recognized:

1) all sequences of participation of this person in the chosen legal entity through direct participation of each previous legal entity in each subsequent legal entity of the corresponding sequence are determined;

2) shares of direct participation of each previous legal entity in each subsequent legal entity in each sequence are determined;

3) for each such sequence there are works of shares of direct participation for all legal entities of this sequence;

4) all works of shares of direct participation found for each such sequence are summed up.

In case of determination of share in the organization also participation of physical person or legal entity in foreign structure without formation of legal entity which according to the legislation of foreign state (territory) in which it is founded has the right to participate in the capital of other organizations or in other foreign structures without formation of legal entity is considered.

In case of determination of share in the legal entity the participation realized by means of ownership of the securities acquired within the repurchase agreement signed according to the legislation of the Republic of Uzbekistan or as a result of the transaction recognized by repo operation according to the legislation of foreign state for the term of no more than one year is not considered.

In such cases for the purpose of determination of share in the legal entity these securities are considered at person who is seller of securities by the first part of repo if only the securities sold by the seller by the first part of repo were not received by it on other repo operation or on transaction of loan securities.

In case of non-execution or execution not in full of the second part of repo, and also in case of the conclusion of the repurchase agreement for the term of more than one year determination of share of participation of one legal entity in other legal entity is performed without the features established by part five of this Article.

In case of determination of share in the legal entity the participation realized by means of ownership of the securities received for the term of no more than one year within the loan agreement securities signed according to the legislation of the Republic of Uzbekistan or foreign state is not considered.

In such cases for the purpose of determination of share in the legal entity these securities are considered at person who is creditor (represents securities to loan) if only the securities transferred within the loan agreement by securities were not received by the creditor on other transaction of loan securities or on repo operation.

In case of non-execution or execution not in full of obligations on return of securities on transactions of loan securities, and also in case of the conclusion of the loan agreement determination of share of participation of one legal entity in other legal entity is performed by securities for the term of more than one year without the features established by part seven of this Article.

Additional circumstances in case of determination of share of participation of one legal entity in other legal entity or physical person in the legal entity are determined by court.

Article 39. Controlled foreign companies

For the purpose of the taxation the controlled foreign company the foreign legal entity falling at the same time under the following conditions is recognized:

1) the foreign legal entity is not recognized the tax resident of the Republic of Uzbekistan;

2) the controlling faces of the foreign legal entity are legal and (or) physical person, recognized by tax residents of the Republic of Uzbekistan.

The controlled foreign company the foreign structure without formation of legal entity which controlling persons are legal and (or) physical person, recognized by tax residents of the Republic of Uzbekistan is also recognized.

Recognition of managing company of investment fund (share fund or other form of implementation of collective investments) by the tax resident of the Republic of Uzbekistan in itself is not the basis for recognition of this investment fund (share fund or other form of implementation of collective investments) the controlled foreign company for which the controlling person is person specified in this part. The same rules are applied in case of management of the managing partners or other persons specified by funds (other forms of implementation of collective investments).

Article 40. Control over the foreign companies and the controlling persons

If other is not provided by this Article, for the purpose of the taxation the controlling persons of the foreign company are recognized:

1) the legal entity or physical person recognized by the tax resident of the Republic of Uzbekistan whose share of participation in the foreign company constitutes more than 25 percent;

2) legal entity or physical person which share in this company constitutes more than 10 percent if share of participation of all persons recognized by tax residents of the Republic of Uzbekistan in this company constitutes more than 50 percent.

For the purposes of part one of this Article share in the foreign company is determined according to the procedure, stipulated in Article the 38th of this Code.

For the physical persons specified in part one of this Article, shares are considered in total with persons specified in Item 11 parts three of article 37 of this Code.

Person is not recognized the controlling person of the foreign company if its participation in it is realized only through direct and (or) indirect participation in one or several legal entities of the Republic of Uzbekistan who are issuers of securities, which (or depositary receipts on which) underwent the procedure of listing and (or) were allowed to the address at the exchanges having the corresponding license or included in the list of foreign financial intermediaries and if this person is not recognized the controlling person according to parts five - the twelfth this Article. At the same time foreign financial intermediaries are understood as the foreign stock exchanges and the foreign depositary and clearing organizations included in the list approved by authorized body on market development of securities of the Republic of Uzbekistan.

The controlling person of the foreign company person concerning whose share of participation in the company the conditions established by part one of this Article are not complied, but at the same time exercising control over this company to own advantage or for the benefit of persons specified in Item 11 parts three of article 37 of this Code is also recognized.

Control over the company for the purpose of of this Code rendering or opportunity to exert the determining impact on the decisions made by this company on distribution of net profit (income) is recognized. At the same time influence or possibility of influence of person on such decisions as owing to direct or indirect participation in this company, and owing to participation in the agreement (agreement) which subject is management of this company, or owing to other features of the relations between this face and the company and (or) other persons is considered.

Control over foreign structure without formation of legal entity for the purpose of of this Code rendering or opportunity to exert the determining impact on the decisions made by person, the asset manager of such structure concerning distribution of the profit (income) got by it according to the legislation of foreign state (territory) which citizen is this physical person or in which this legal entity, and (or) constituent documents of the specified legal entity or other circumstances is created is recognized.

If other is not provided by this Article, for the purpose of of this Code the controlling person of foreign structure without formation of legal entity the founder (founder) of this structure is recognized.

If other is not provided by part eleven of this Article, the founder (founder) of foreign structure without formation of legal entity is not recognized the controlling person of this structure if concerning it all following conditions are at the same time complied:

1) such person has no right to receive (to require obtaining) directly or indirectly profit (income) of this structure fully or partially;

2) such person has no right to dispose of profit (income) of this structure or its part;

3) such person did not reserve the right to the property transferred to this structure (the property is transferred on the terms of irrevocability);

4) such person does not exercise over this structure control according to part seven of this Article.

Stipulated in Item 3 parts nine of this Article the condition is recognized executed if the founder (founder) of foreign structure without formation of legal entity has no right to receive assets of this structure in property. At the same time restriction for obtaining fully or partially in property of assets of this structure throughout the entire period of its existence, and also in case of its termination (liquidation, agreement cancelation) shall be confirmed with the legislation of foreign state (territory) in which this structure, and (or) its constituent documents is created.

Person specified in part nine of this Article is recognized the controlling person of foreign structure without formation of legal entity if it reserves the right to receive any of the rights specified in Items 1 - 3 parts nine of this Article.

The controlling person of foreign structure without formation of legal entity for the purpose of of this Code the other person who is not her founder (founder) is also recognized if such person exercises control over structure and at the same time concerning it one of the following conditions is carried out at least:

1) such person has the actual right to the income (its part) received by this structure;

2) such person has the right to dispose of property of this structure;

3) such person has the right to receive property of this structure in case of its termination (liquidation, agreement cancelation).

The tax resident of the Republic of Uzbekistan has the right to recognize independently himself as the controlling person of the foreign company on the bases provided by parts one of either the fifth this Article, or foreign structure without formation of legal entity on the bases provided by parts nine or the twelfth this Article. In such cases person who recognized himself as the controlling person sends to tax authority in the place of the accounting the adequate notice according to the procedure, provided by this Code.

The rules of recognition of the controlling persons of foreign structures without formation of legal entity established by this Article are applied also to recognition of the controlling faces of foreign legal entities for which according to the legislation of foreign state (territory) in which they are founded or citizens of which they are, equity participation is not provided.

Article 41. Dividends and percent

Dividends are recognized:

1) any income gained by the shareholder (participant) in case of profit distribution of the legal entity (including in the form of percent on preferred stocks) according to the shares (shares) of this legal entity owned by the shareholder (participant);

2) payments in case of liquidation to the shareholder (participant) of the legal entity in cash or natural form in the part exceeding the size of share of this shareholder (participant) in authorized fund (authorized capital) of this legal entity;

3) the payment of actual value of part of share to the excluded or left participant determined by data of accounting records of society for the last accounting period preceding date of exception and exit of the participant in the part exceeding the size of share of this shareholder (participant) in authorized fund (authorized capital) of this legal entity;

4) the shareholder returns (participant) of the legal entity gained in cost type of additional shares (increase in nominal value of share) in case of increase in authorized fund (authorized capital) at the expense of equity (property) of this legal entity.

The income specified in part one of this Article is recognized dividends provided that they are paid in proportion to shares of shareholders (participants) in authorized fund (authorized capital) of the legal entity paying such income.

Dividends also any income gained from sources outside the Republic of Uzbekistan, relating to dividends according to the legislation of foreign states is recognized.

For the purpose of of this Code the income paid to the owner of private enterprise, the member of family company or the head of farm from the being at the command amount of profit of such legal entities is equated to dividends.

In percent any in advance reported (established) income, including in the form of discount, received on debt obligation of any kind (irrespective of method of its registration), including on money deposits is recognized.

Article 42. Income

The income the economic benefit in cash or natural form considered in case of possibility of its assessment and in that measure in which such benefit can be estimated is recognized.

Article 43. Income from sources in the Republic of Uzbekistan

Income of the taxpayer can be carried to the income from sources in the Republic of Uzbekistan or to the income from sources outside the Republic of Uzbekistan.

Income from economic activity in the Republic of Uzbekistan and other income which is directly connected with its jurisdiction, legal capacity and (or) the economic relations with its state bodies and other subjects of the economic relations belong to the income from sources in the Republic of Uzbekistan.

If provisions of this Code do not allow to carry unambiguously the income to the income received from sources in the Republic of Uzbekistan or to the income from sources outside the Republic of Uzbekistan, reference of the income to this or that source is performed by the State Tax Committee of the Republic of Uzbekistan. In similar procedure the share of the specified income which can be carried to the income from sources in the Republic of Uzbekistan, and share which can be carried to the income from sources outside the Republic of Uzbekistan is determined.

Article 44. Royalty

Royalty are recognized payments for use or right to use of any intangible asset, including:

copyright of works of art, literatures and sciences, including copyright of the software and databases, the drawing, design or model, the plan, confidential formula, technology or process, audiovisual works and objects of the related rights, including execution and soundtracks;

patents, trademarks, trademarks or other similar types of the rights;

information of rather industrial, commercial or scientific experience (know-how). The know-how is understood as information of industrial, commercial or scientific nature on results of intellectual activities in the scientific and technical sphere or (and) methods of implementation of professional activity, following from the previous experience, having practical application in economic activity, and also the real or potential commercial value (in view of its uncertainty to the third parties if to such data the third parties have no open entry legally) and as a result of which disclosure the economic benefit can be received.

The payments paid for are not considered as royalty:

1) use of the computer program (including its adaptation by setup with use of the pledged internal opportunities) if conditions of use are limited to functional purpose of such program for final consumption and its reproduction is limited the number of the copies necessary for such use;

2) purchase of goods (including data carriers) in which are realized or on which there are objects of intellectual property right determined in Item 1 of this part in use, ownership and (or) the order of person;

3) rendering services in development of computer programs and databases (software and information products of computer facilities), and also on installation, completion and setup of programs, their adaptation and modification;

4) again acquired information of industrial, commercial or scientific nature which is result of rendering services based on the contract with the customer;

5) transfer of the right to distribution of copies of program products without the right to their reproduction or if their reproduction is limited to use by the final consumer.

Article 45. Goods and services. Commodity market (services)

Goods any subject of the nature or human activities (including intellectual) having cost assessment and intended for realization is recognized.

Goods, in particular, the electric power, the database, information, results of intellectual activities, including exclusive rights on them are recognized.

For the purpose of the taxation property rights are also recognized goods.

For the purpose of the taxation property right the object of the civil law of intangible nature directed to property, having money value and capable to turnover, independent, independent of this property is recognized (can be subject to purchase and sale or other alienation from his owner having the right of possession, uses and orders of this property right specified in the agreement or other supporting document).

Treat property rights, in particular: the right to claim of the creditor against the debtor, share in authorized capital (authorized capital) of economic society, securities, the author's right (or other owner) on intellectual property item, and also other types of the rights connected with the property which is their cornerstone which can be sold or are otherwise aloof from his owner.

The corporeal rights which independent turnover without transfer of the thing is impossible are not considered as property rights.

For the purpose of regulation of the relations connected with collection of customs payments to goods other property determined according to the customs legislation can belong.

Services for the purpose of the taxation types of the business activity on production of products (material or non-material) directed to requirements satisfaction of other persons and also the works performed for other persons are recognized.

Activities of physical persons within the employment contract with the employer do not belong to services.

Identical goods (services) for the purpose of the taxation goods (services), the main signs, having identical characteristic of them, are recognized.

In case of determination of identity of goods insignificant distinctions in appearance of such goods can not be considered.

In case of determination of identity of goods their physical characteristics, quality, functional purpose, country of source and the producer, its goodwill in the market and the used trademark are considered.

In case of determination of identity of services characteristics of the contractor (contractor), its goodwill in the market and the used trademark are considered.

Uniform goods for the purpose of of this Code goods which, without being identical, have similar characteristics are recognized and consist of similar components that allows them to perform the same functions and (or) to be commercially interchangeable.

In case of determination of uniformity of goods their quality, reputation in the market, the trademark, country of source are considered.

Uniform services such services which, without being identical, have similar characteristics that allows them to be commercially and (or) functionally interchangeable are recognized.

In case of determination of uniformity of services their quality, the trademark, reputation in the market, and also type of service, their amount, uniqueness and commercial interchangeability are considered.

Commodity market the sphere of the address of these goods determined proceeding from possibility of the buyer (seller) without considerable additional costs to acquire (to realize) these goods in the territory of the Republic of Uzbekistan or beyond its limits is recognized. In similar procedure the market of services is determined.

Article 46. Sales of goods and services

Sales of goods or services transfer on paid basis of the property right to goods or paid rendering services, including exchange and transfer of the pledged goods in case of non-execution by the debtor of the obligation provided with pledge is recognized.

In the cases provided by this Code, realization also the transfer of property on goods or rendering services on a grant basis is recognized.

Article 47. Invoice

In case of sales of goods (services) legal entities and individual entrepreneurs shall if other is not provided by this Article, to expose to buyers of these goods (services) of the invoice.

The invoice is, as a rule, drawn up electronically in information system of electronic invoices.

In case of sales of goods (services) of the rule, provided by parts one and the second this Article, are not applied if the seller issued to the buyer the cash register receipt or other document of the established form.

In case of change in value of implementable goods (services), including in cases of the change in price or refining of quantity (amount) of the delivered goods or the rendered services, the seller shall expose to the buyer additional or corrected the invoice according to the procedure, provided by this Code.

The foreign legal entities who are subject to registration according to article 279 of this Code do not expose the invoice, registers of purchases, registers of sales, registers of the received and exposed invoices regarding rendering the services specified in Article 282 of this Code do not conduct.

The form of the invoice and procedure for its filling affirm the State Tax Committee of the Republic of Uzbekistan in coordination with the Ministry of Finance of the Republic of Uzbekistan.

Article 48. Target means

For the purpose of the taxation the property received by the taxpayer for use by it to destination, determined by person - source of target means or the legislation belongs to target means.

Treat target means, in particular:

1) budgetary appropriations and budget subsidies;

2) grants and humanitarian assistance;

3) target receipts.

Grants for the purpose of the taxation the property provided on a grant basis according to the procedure, determined by the Cabinet of Ministers of the Republic of Uzbekistan is recognized:

1) states, governments of the states, international or foreign government or non-governmental organizations to the Republic of Uzbekistan;

2) foreign citizens and stateless persons to the Republic of Uzbekistan.

The humanitarian assistance for the purpose of the taxation the target non-paid assistance to the Republic of Uzbekistan for rendering the medical and (or) public assistance to socially vulnerable national groups, supports of organizations of the social sphere, the prevention and natural disaster response, accidents and catastrophic crashes, epidemics, epizooty and other emergency situations distributed by the Cabinet of Ministers of the Republic of Uzbekistan through the organizations authorized by it is recognized.

Receipts (except for receipts in the form of excise goods) on the content of non-profit organizations and conducting authorized activities by them which arrived gratuitously based on decisions of public authorities and also the receipts from other legal and (or) physical persons used by the specified receivers for designated purpose belong to target receipts.

By them treat target revenues to content of non-profit organizations and conducting authorized activities:

1) the fees of founders (participants, members) performed according to the legislation on non-state non-profit organizations, and also donations recognized by those according to the civil legislation.

2) the income in type gratuitously the services received by non-profit organizations rendered based on the relevant agreements;

3) assignments on forming in the procedure for reserve established by this Code on carrying out repair, capital repairs of common property which are made to condominium, housing, gardening, garden gardening, garage construction, to building or other specialized consumer cooperative by their members;

4) the property passing to non-profit organizations according to the will according to the procedure of inheritance;

5) the budgetary funds provided on implementation of authorized activities of non-profit organizations;

6) means and other property received on charity implementation;

7) the means which arrived to the trade-union organizations according to collective agreements (agreements) on holding by the trade-union organizations the welfare and other actions provided by their authorized activities;

8) the means gratuitously received by non-profit organizations on conducting the authorized activities which are not connected with business activity from the structural divisions created by them according to the legislation being taxpayers;

9) the property received by the religious organizations on implementation of authorized activities;

10) the property rights in the form of the right of free use by state-owned property acquired according to decisions of public authorities by non-profit organizations for conducting authorized activities by them.

Article 49. Securities

Securities are the documents certifying property rights or the relations of loan between the issued these documents the legal entity and their owner providing payment of the income in type of the dividends or percent and possibility of assignment of rights following from these documents, to other persons.

Shares, bonds, bills, deposit certificates, depositary receipts, options, futures and forward contracts, and also other securities recognized by those according to the legislation or the applicable legislation of foreign state belong to securities.

The procedure for reference of securities to issued securities is established by the legislation or the applicable legislation of the Republic of Uzbekistan of foreign states.

If transaction with securities corresponds to criteria of financial instrument transaction of forward transactions, the taxpayer has the right to carry independently it for the purpose of the taxation to transactions with securities or to financial instrument transactions of forward transactions.

For the purpose of the taxation securities are recognized (transferable securities) which are traded on the organized market of securities in case of simultaneous observance of the following conditions:

they are allowed to the address at least by one organizer of the biddings by securities;

information on their prices (quotations) is published in mass media or can be provided by the organizer of the biddings or other authorized person to any interested person within three years after transaction date with securities;

on them within the consecutive three months preceding date of making by the taxpayer of the transaction with these securities at least the market quotation once was calculated (except for calculation of the market quotation in case of primary placement of securities by the issuer).

Article 50. Financial instruments of forward transactions

The financial instrument of forward transactions for the purpose of of this Code the contract in relation to basic asset with distribution of the rights and obligations of the Parties of the agreement and specifying of date on which obligation fulfillment of the parties falls is recognized.

For the purpose of of this Code the agreement, requirements for which are not subject to judicial protection according to the civil legislation of the Republic of Uzbekistan and (or) the applicable legislation of foreign states, is not recognized the financial instrument of forward transactions. The losses received from the specified agreement are not considered in case of the taxation.

The basic asset of financial instruments of forward transactions is understood as subject of forward transaction.

The foreign currency, securities and other property, interest rates, credit resources, price indexes or interest rates, other financial instruments of forward transactions can act as basic asset, in particular.

Participants of forward transactions for the purpose of of this Code are understood as the legal entities and physical persons making financial instrument transactions of forward transactions.

Execution of the rights and obligations on financial instrument transaction of forward transactions execution of the financial instrument of forward transactions by delivery of basic asset, by performing final settlement on the financial instrument of forward transactions or by making by the participant of forward transaction of the transaction opposite to earlier made transaction with the financial instrument of forward transactions is recognized.

For financial instrument transactions of the forward transactions directed to purchase of basic asset, transaction of opposite orientation the transaction directed to sale of basic asset, and for the transaction directed to sale of basic asset - the transaction directed to purchase of basic asset is recognized.

The taxpayer of this Article having the right taking into account requirements to independently qualify the transaction which conditions provide delivery of basic asset, recognizing it as transaction with the financial instrument of forward transactions or the transaction on delivery of subject of the transaction with execution delay.

Criteria of reference of the transactions providing delivery of subject of the transaction (except for hedging transactions), to category of financial instrument transactions of forward transactions shall be determined by the taxpayer in accounting policy for the purposes of the taxation.

End date of transaction with the financial instrument of forward transactions is completion date of the rights and obligations on transaction with the financial instrument of forward transactions.

Obligations on the financial instrument of forward transaction without its retraining can be stopped:

1) offsetting (offset) of uniform requirements and obligations;

2) according to the procedure, determined by the general agreement which corresponds to approximate conditions of agreements if such termination provides determination of the amount net - obligations;

3) offsetting of the demands in reconvention following from the agreements signed on the terms of rules of the organized biddings or rules of clearing if such offsetting is made for the purpose of determination of the amount net - obligations.

For the purpose of of this Code requirements for delivery of the rights of securities of one issuer, one type, one category (type) or one mutual investment fund having identical amount (for investment shares of mutual investment funds), and also requirements for payment of money are recognized uniform the same currency.

The taxation of the transactions qualified as transactions on delivery of subject of the transaction with execution delay is performed according to the procedure, provided by this Code for the corresponding basic assets of such transactions.

For the purpose of of this Code financial instruments of forward transactions are subdivided into the financial instruments of forward transactions which are traded on the organized market (the addressing financial instruments of forward transactions) and the financial instruments of forward transactions which are not traded on the organized market (not addressing financial instruments of forward transactions).

Financial instruments of forward transactions are recognized being traded on the organized market in case of simultaneous observance of the following conditions:

1) the procedure for their conclusion, address and execution is established by the organizer of the biddings having the right to it according to the legislation of the Republic of Uzbekistan or the legislation of foreign states;

2) price information of financial instruments of forward transactions is published in mass media or can be provided by the organizer of trade or other authorized person to any interested person within three years after transaction date with the financial instrument of forward transaction.

If the bargain is concluded not in the organized market and its conditions provide delivery of basic asset, it can be qualified as the financial instrument of forward transactions only provided that delivery of basic asset in accordance with the terms of such transaction shall be performed not earlier than the day before yesterday after day of its conclusion.

The bargain which is concluded not in the organized market and which conditions do not provide delivery of basic asset can be qualified only as the financial instrument of forward transactions.

Financial instruments of forward transactions which conditions provide delivery of basic asset or the conclusion of other financial instrument of forward transactions with delivery condition of basic asset are recognized deliverable forward transactions.

Financial instruments of forward transactions which conditions do not provide delivery of basic asset or the conclusion of other financial instrument of forward transactions with delivery condition of basic asset are recognized settlement forward transactions.

The transactions qualified as deliverable forward transactions, and also as transactions on delivery of subject of the transaction with execution delay for the purpose of of this Code are not subject to retraining in settlement forward transactions in case of discharge by the methods other than proper execution.

The variation margin is understood as the cash amount calculated by the organizer of the biddings or the clearing organization and paid (received) by participants of forward transactions according to the rules established by organizers of the biddings and (or) the clearing organizations.

Article 51. Hedging

Transactions of hedging for the purpose of of this Code are understood as the transactions (set of transactions) with financial instruments of forward transactions (including different types) made for the purpose of reduction (compensation) of consequences, adverse for the taxpayer, (fully or partially).

To such adverse effects receipt of loss, reduction of revenue or profit, reduction of market value of property, increase in obligations of the taxpayer owing to the change in price, interest rate, the foreign exchange rate can be referred to national currency or other indicator (set of indicators) of object (objects) of hedging, in particular.

Objects of hedging the property, property rights of the taxpayer and his obligation which completion date did not step on transaction date of hedging are recognized.

Rights to claim and obligations can be objects of hedging, implementation (execution) of which is caused by submission of demand of the agreement party and on which the taxpayer made the decision on hedging.

The basic assets of financial instruments of forward transactions used for hedging transaction can differ from object of hedging.

For the purpose of hedging the conclusion more than one financial the instrument of forward transaction of different types, including the conclusion of several financial instruments of forward transactions within one transaction of hedging during hedging term is allowed.

For confirmation of justification of reference of financial instrument transaction of forward transactions to hedging transaction the taxpayer constitutes for date of the conclusion of the transaction on hedging transaction the reference, confirmatory that proceeding from forecasts of the taxpayer making of this transaction allows to reduce the adverse effects connected with the change in price, the market quotation, the currency rate or other indicator of object of hedging.

If for the purpose of one transaction of hedging set of financial instrument transactions of forward transactions is used, such reference is constituted for date of the conclusion of the first of this set of the transaction.

Article 52. Repo operations with securities

According to the repurchase agreement one party of the transaction sells to other party of the transaction securities with the obligation of their return sale (purchase) through certain term at the price which is in advance determined in this agreement. At the same time the selling price (purchases) of these securities determined in the agreement can differ from their market prices.

Repo operation the agreement meeting requirements imposed to repurchase agreements by the legislation of the Republic of Uzbekistan and (or) the applicable legislation of foreign states is recognized. At the same time the first and second parts of repo the first and second parts of the repurchase agreement respectively are recognized.

The buyer by the first part of repo and the seller by the first part of repo are recognized the buyer according to the repurchase agreement and the seller according to the repurchase agreement respectively. At the same time obligations by the second part of repo shall arise on condition of execution of the first part of repo.

Conditions of repo operation can provide, at least, one of the following rights of the parties of the transaction:

1) the right of the seller by the first part of repo before completion date of the second part of repo to transfer to the buyer by the first part of repo in exchange for the securities transferred by the first part of repo or to securities into which they are converted other securities;

2) the right of the buyer by the first part of repo to demand from the seller by the first part of repo of the transfer specified in Item 1 of this part.

For the purpose of of this Code the completion dates provided by the repurchase agreement by the corresponding part of repo are considered as participants of repo operation of the obligations as completion dates of the first or second part of repo.

In case of obligation fulfillment on delivery of securities and on their payment by the first or second part of repo in different dates date of the first and date the second parts of repo respectively is recognized the latest of completion dates of obligations on payment or delivery of securities.

Completion date of obligations by the second part of repo can be changed both towards reducing term of repo, and towards its increase. Transactions by which completion date of the second part of repo is determined by the claiming moment are recognized repo operations if the repurchase agreement establishes procedure for determination of the price of the second part of repo and if the second part of repo is performed within one year from completion date by the parties of obligations by the first part of repo.

For the repo operations made through the organizer of the biddings in the security market (exchange) or with execution through the clearing organization, any change of completion date of the second part of repo performed according to rules of the organizer of the biddings in the security market (exchange) or the clearing organization for the purpose of this Article is recognized change of term of repo.

For the purpose of of this Code the repo rate is determined in case of the conclusion of repo operation and can be fixed or settlement.

The repo rate shall allow to determine the size of percent for the end of the accounting (tax) period and can be changed by agreement of the parties the repurchase agreement.

If for completion date of the second part of repo the obligation on implementation (acquisition) of securities by the second part of repo is fully or partially not fulfilled and the procedure of settlement of mutual requirements is not carried out, the second part of repo is recognized is inadequate performed if other is not provided by part six of this Article.

For the purpose of of this Code is not recognized not complete execution of the second part of repo:

1) obligation fulfillment by the second part of repo within ten days from the completion date of the second part of repo approved by the parties;

2) execution (termination) of obligations by offsetting of demands in reconvention in the following cases:

a) if such requirements follow from the agreements signed on the terms of the general agreement (the single agreement) which corresponds to the approximate conditions of agreements approved according to the legislation of the Republic of Uzbekistan or the applicable legislation of foreign states. At the same time offsetting of demands in reconvention is made for the purpose of determination of the amount net - obligations;

b) if such requirements follow from the agreements signed on the terms of rules of the organized biddings and (or) rules of clearing. At the same time offsetting of demands in reconvention is made for the purpose of determination of the amount net - obligations.

In cases of improper execution of the second part of repo repo operation is subject to retraining for the purpose of the taxation.

Retraining of repo operation for the purpose of the taxation is performed by the taxpayer independently in the following cases:

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