RESOLUTION OF THE PRESIDENT OF TURKMENISTAN

of August 23, 2002 No. 5835

About enhancement of procedure for use of state-owned property

For the purpose of streamlining and further increase in efficiency of use of state-owned property I decide:

1. Determine that powers of the lessor of state-owned property, irrespective of its departmental accessory, are performed by the Ministry of Economics and finance of Turkmenistan.

Hyakimliki of welayats, the cities and etraps is performed by powers of the lessor of non-residential premises in apartment houses subordinated to them.

2. Prohibit to the ministries, to departments, to the state companies, the organizations and organizations self-willedally to lease state-owned property, property hiring, to sell or alienate it otherwise.

3. Determine that registration of the lease agreements of state-owned property including concluded by hyakimlika of welayats, cities and etraps is performed by the Ministry of Economics and finance of Turkmenistan.

4. Approve the enclosed Regulations on procedure for lease of state-owned property.

5. Exempt the Ministry of Economics and finance of Turkmenistan from payment of the state fee in case of submission of actions for declaration in court concerning lease, property hiring, purchase and sale or alienation of state-owned property otherwise.

6. To the main State Tax Service of Turkmenistan illegal to collect in the income of the Centralized budget of Turkmenistan the amount the received money (except tax amount on value added) in case of identification of cases of non-compliance by the state companies, organizations and organizations of established procedure of delivery of state-owned property in lease.

7. To the Ministry of Economics and finance of Turkmenistan:

together with the Ministry of Justice of Turkmenistan to prepare and provide to the Cabinet of Ministers of Turkmenistan offers on modification and the amendments in the current legislation of Turkmenistan following from this resolution;

bring departmental regulatory legal acts into accord with this resolution.

8. Recognize invalid:

the resolution of the President of Turkmenistan of March 3, 2000 No. 4599 "About streamlining of lease of state-owned property";

the resolution of the President of Turkmenistan of August 31, 2000 No. 4820 "About entering of amendment into the Regulations on procedure for lease of state-owned property approved by the resolution of the President of Turkmenistan of March 3, 2000 No. 4599".

9. To impose control over the implementation of this resolution on the Vice-chairman of the Cabinet of Ministers of Turkmenistan Atayeva E. G. and hyakimlik of welayats, the cities and etraps.

Approved by the resolution of the President of Turkmenistan of August 23, 2002 No. 5835

Regulations on procedure for lease of state-owned property

1. This Provision determines the procedure of the conclusion of lease agreements of state-owned property, and also regulates procedure of payments and distributions of the rent and other lease term state imushchestva*.

2. Objects of lease are consisting on balance of the ministries, departments, hyakimlik, the state companies, organizations, organizations (asset holders) buildings, constructions, rooms, machines, the equipment and other property which is temporarily not used for purpose (unspecified, preserved hereinafter are referred to as further) and on technical condition serviceable, and also transfer to lease without prejudice to production.

Property complexes of the state companies, their separate divisions, including the parcels of land allocated for them in the procedure established by the legislation, fully or partially can also be objects of lease.

3. Subjects of lease are citizens and legal entities of Turkmenistan and foreign states which have the right to submit the application for acquisition to lease of state-owned property in accordance with general practice.

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* In the text of this provision the concept of lease includes concept of property hiring.

4. Lease of state-owned property which particular legal regime of use is set by the legislation of Turkmenistan or the signed international treaties (agreements) is allowed only in coordination with the Cabinet of Ministers of Turkmenistan.

5. Lessor of state-owned property, irrespective of its departmental accessory, is the Ministry of Economics and finance of Turkmenistan, and also hyakimlika of welayats, the cities and etraps concerning non-residential premises in apartment houses subordinated to them.

The lessor has all legal basis necessary for the conclusion of the lease agreement according to this Provision, and actions of the asset holder concerning object of lease shall not violate obligations of the parties under the specified agreement.

6. Powers on transfer of state-owned property to lease, registration of prisoners, including hyakimlikam of welayats, the cities and etraps of agreements, accounting, accomplishment control lease term, including lease payments, and also to maintaining the special register of the signed agreements exercises Control of state-owned property and privatization of the Ministry of Economics and finance of Turkmenistan and its profile departments on places.

7. The basis for the conclusion of the lease agreement is the relevant proposal of the applicant or asset holder. The procedure of the conclusion of lease agreements of state-owned property provides representation by the asset holder and (or) applicant of the request in the established form to the lessor, determination of lease term and rate of the rent, registration, the conclusion and registration of the lease agreement.

In the presence of two and more requests on one same property the lease agreement is signed with the applicant declared as the winner of private auction which procedure for carrying out is regulated by the Ministry of Economics and finance of Turkmenistan.

If the state-owned property is not used by the asset holder for purpose or used inefficiently, the lessor is competent to lease it independently.

8. The lease agreement of state-owned property is signed in writing between the lessor and the applicant (further hereinafter is referred to as as the lessee) in the form established by the Ministry of Economics and finance of Turkmenistan and approved with the asset holder.

9. In the lease agreement the name and the location of object of lease, condition and the period of lease, the rent amount, procedure and terms of calculations, the information about the lessor, the lessee and the asset holder, their location and payment details, the rights, obligations and responsibility of the parties are specified.

The acts of visual survey (technical characteristic) of object of lease, its reception-transmission (return), and also calculation of the rent attached to the lease agreement are its integral parts.

10. The lease agreement constituted in three, the copies having equal force, signed by the lessor and the lessee, and also approved with the asset holder becomes effective after its registration.

The lease agreement is subject to registration and in case of unreasonable refusal of the asset holder of its coordination.

11. Calculation of the rent provides:

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