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20 January 2023

Briefing with the Head of Department of the UzSAMA M. Ubaidov on the privatization of non-agricultural land plots

 

Briefing text:

In order to simplify and accelerate the process of privatization of non-agricultural land plots, the Resolution of the Cabinet of Ministers No. 685 dated November 30, 2022 was approved.

This Resolution reduces the fees for privatization of land plots owned by individuals and legal entities by right of permanent use (ownership), lease and lifetime inheritable possession. It also introduces a new simplified procedure for offering non-agricultural land plots at auction. In particular:

  • Previously the repurchase price of land plots permanently used (owned) by individuals and legal entities was set at the rate of 20-times the basic rate of land tax on all territories of the country, but according to the new procedure the repurchase price in Tashkent, Nukus and regional centers was decreased and set at the rate of 10-times the basic rate of land tax, in other territories - 5-times.
  • Most importantly, placing land plots to auction consisted of 13 steps and required from 48 working days (in case of lease) to 74 working days (in case of ownership) for placing them to auction. Currently, due to unification of approval and discussion processes regarding land plots, the approval stage has been set in 8 steps and the deadline for placing them to auction is 16 working days in case of lease and up to 22 working days in case of ownership.
  • The procedure of offering land plots with ready master plan for construction of trade complexes, logistic center and service complex, construction of mahalla in touristic zones and creation of roadside infrastructure has been introduced. In this case, the construction work will be carried out in the manner specified in the completed business plan without any work on the engineering of the land on the part of the project organizations.
  • It was determined that 50% of the proceeds from the auction of land will be kept at the discretion of the budget of the district (city) where the land is located. Previously, the funds remained at the discretion of the region. This, in turn, contributes to the socio-economic stability of the regions.

Individuals and legal entities have a number of opportunities to purchase vacant non-agricultural land plots at auction for entrepreneurial and urban development activities:

To pay the sale price:

  • Winners of the electronic online auction held for the lease of land plots for the construction of multi-story residential buildings will pay 30% of the lot price no later than 5 business days from the end of the auction, and the remaining amount will be allowed to be paid in equal installments for 12 months without interest (basis 09.12.2021. PD-33)
  • The sale price of ownership of non-agricultural land plots in the electronic online auction may be paid in installments for a period of up to 3 years. (Ground 04.2022 PD-101)
  • When leasing land plots in industrial zones through the electronic online auction, the possibility of paying the initial cost in installments for 12 months is provided. (basis 06.2022 PD-153).

There are also opportunities to pay the amount of the deposit to participate in the auction:

Presidential Decree No. PD-287 of December 30, 2022, divided districts and cities into 5 categories.

Accordingly, there is an opportunity to participate in the auction of land plots located in districts (cities) of 4 and 5 categories by paying 50 percent of the initial amount of the deposit.

It should be noted that:

During 2022, 90,000 (5,743 ha) vacant non-agricultural land plots were listed in the AIS "Yerelektron", of which 56,000 (3,303 ha) were offered for auction. Of these, 12,000 (982 hectares) were sold for 989 billion UZS, including 3,400 (75 hectares) sold on the right of ownership and 8,800 (921 hectares) on the right of lease. This resulted in revenue of over 559.9 billion UZS, of which 421.8 billion UZS was directed to relevant budgets.

Also, more than 30,000 applications for privatization of land plots owned by citizens and legal entities of the Republic of Uzbekistan were received by the State services, of which 7,080 were approved, while 2,005 of this number are in the process of payment and 2,320 were issued State Orders.

In the field of privatization:

In order to simplify the process of privatization of state property, ensure the transparency of the privatization process and accessibility of the electronic trading platform "E-auksion" and further increase the possibility of participation in it, since August 1, the mobile application "E-auksion" was launched, and for citizens and entrepreneurs created the opportunity to download the application through the App Store and Play Market.

In order to increase awareness in the regions, regular meetings, discussions and presentations are held (a "Road Show" was held in 11 regions), as well as press tours. More than 1,500 advertising campaigns were carried out in the Mass Media, including television, radio, newspapers, magazines, and social networks.

On 76 LED screens in the central streets of Tashkent and regional centers, as well as on about 150 screens in densely populated areas and 100 billboards on highways, 817 screens in public service centers are constantly broadcasting video clips and promotional materials.

In turn, according to the Presidential Resolution of March 18, 2022 PR-168:

  • no examination of the reliability of valuation reports of subsidiaries of international reputable auditing companies operating in Uzbekistan is required;
  • business entities, purchased state real estate objects with the condition of payment in installments, which were issued a state order on the right of ownership "without the right of disposal" before the full implementation of payment, pay value added tax after the full transfer of the right of disposal of these objects;

Also, this resolution created the possibility of placing the state real estate with an area of up to 2,000 square meters for direct online electronic auction on the basis of the online application of assistant of khokim in accordance with the procedure approved by the Agency.

It is established that the funds coming from the sale of state real estate objects up to 2 000 square meters in area on the mahallas on the basis of online application of assistant of khokims, excluding the costs of appraisal and sales, shall be transferred to the Funds for solving socio-economic problems of the mahallas of the relevant mahallas.

At the same time, according to the decision of the Cabinet of Ministers No. 420 dated August 1, 2022, buyers have the right to mortgage the state assets and land plots acquired by installment as loan collateral on condition of a one-time initial payment of not less than 35% for these state assets and non-agricultural land plots.

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