Uzbekistan approves amendments halving fines for exporters who have not received payment from foreign partners

Deputies approved softer penalties

On 20 October, the Legislative Chamber of the Oliy Majlis passed in its second and third readings amendments to Article 11-1 of the law “On Currency Regulation”, providing for a twofold reduction of fines for violating the deadlines for returning foreign trade assets when mitigating circumstances exist. The document has been sent to the Senate for consideration. The bill is aimed at protecting entrepreneurs who cannot return funds or other assets in time due to the actions of foreign counterparties, restrictions imposed by international payment systems, and other circumstances beyond their control.

Scale of the problem

According to data presented during consideration of the initiative, in 2024 economic courts imposed fines on 3,500 entrepreneurs totaling 752 billion soums. In 2025 the number of such cases rose to 9,100, and the amount of sanctions to 3.3 trillion soums. The developers believe that current legislation insufficiently accounts for situations where an entrepreneur in good faith tries to fulfill obligations but cannot secure the return of assets for reasons beyond their control.

Conditions for reducing the fine

The bill provides for a court to reduce the fine by 50% if at least one of the following circumstances exists: the company took all measures within its power in good faith to return foreign trade assets, including going to court, arbitration, or other lawful mechanisms for enforced debt collection; at least 50% of the assets were returned under the foreign trade transaction; the return was restricted due to international sanctions, restrictions of banking or payment systems, or bans on currency transactions in the counterparty’s country or the country where the payment was made. A reduction of the fine does not mean the remaining debt is extinguished or that the company is released from the obligation to seek its return.

What changed by the second reading

Ulugbek Kabulov, a member of the parliamentary Committee on Combating Corruption and Judicial-Legal Issues, said that in preparing for the second reading the deputies clarified three provisions. First, mitigating circumstances now include cases where a resident sought protection of its rights in court or arbitration or used other enforcement measures; a separate clause was added for confirmed force majeure. Second, the asset return threshold was changed from “more than 50%” to “50% or more”, so that cases where exactly half of the assets were returned also qualify for the benefit. Third, the word “generally known” was removed from the phrase “generally known international sanctions”.

Context of the current sanctions

Under the law “On Currency Regulation”, the overall deadline for returning assets under foreign trade transactions is 180 days from the date of payment or export. If, after its expiry, the delay exceeds a further 45 days (90 days for small businesses), fines may be applied: 5% of the amount of unreturned assets for a delay of up to 360 days, an additional 10% for 360 to 545 days, and a further 35% for over 545 days; in total the sanctions can reach 50%. A presidential decree of 27 August 2026 provides that from 1 January 2027 fines will be halved if at least one mitigating circumstance exists; the bill enshrines this mechanism. The benefit does not apply to companies with a state share of 50% or more, nor to organizations in which such companies hold at least 50% of the capital. In addition, until 1 January 2027 entrepreneurs are allowed to repay overdue export debt that arose before the decree took effect using their own funds: uncollected fines are cancelled in proportion to the repaid debt, but such receipts are not counted as export revenue and do not confer the right to a zero VAT rate.

Significance of the amendments

The growth in the number of fines from 3,500 to 9,100 cases and in the amount of penalties from 752 billion to 3.3 trillion soums over a year shows that the problem of non-repatriation of foreign trade assets is affecting ever more exporters, and it was precisely this that was cited to justify the initiative. The amendments directly concern private export-oriented companies affected by the actions of foreign counterparties or payment restrictions: if the conditions are met, a court will be able to halve the fine, and until January 1, 2027, entrepreneurs will have the opportunity to repay old debts with their own funds, with a proportional cancellation of uncollected fines. The final entry into force of the amendments depends on the document's consideration by the Senate, which had not yet taken place at the time of publication.