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Uzbek Banks are Charged with Purchase of Bankrupt Enterprises

Business Materials 12 December 2008 13:35 (UTC +04:00)

Uzbekistan, Tashkent, Dec.11 / corr. Trend T. Zhukov/ Uzbekistan's President Islam Karimov approved sale of economically bankrupt enterprises to commercial banks, Trend correspondent in Tashkent reported.

The document envisages purchasing of bankrupt enterprises by private banks under condition of their further restoration, modernization, technological re equipment, rise of production competitive capacity in foreign market, the Uzbek Association of Banks said.

"Managing organizations, newly created by commercial banks under property of bankrupt enterprises, are profit tax, single tax payment, property tax and land tax free till they are sold to strategic investor but no more than three years from their state registration," according to the decree.

Released funds will be allocated to technical and technological re-equipment, modernization and development of production. Moreover, managing companies founded by commercial banks, are released from payment of profit tax and single tax within the first two years after their state registration.

Only Uzbek commercial banks-residents can take part in competitive auctions. A bankrupt enterprise is sold under a business plan designed by a commercial bank. The business plan should envisage complex of actions on restoration, technical and technological modernization and re equipment of production.

New owners of bankrupt enterprises are allowed, necessarily, to restructure or reshape an enterprise, liquidate unnecessary branches and unprofitable production units, to sell and alienate unnecessary property and lands.

Bank owner can recruit strategic investors, as well as foreigners, to sell them enterprises at market price in future.

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