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Uzbekistan's Mirziyoyev increases legal protection of creditors

Business Materials 26 November 2018 15:27 (UTC +04:00)

Baku, Azerbaijan, Nov. 26

By Fikret Dolukhanov – Trend:

President of Uzbekistan Shavkat Mirziyoyev signed a decree “On Measures to Strengthen the Legal Protection of Creditors and Improve Financing Mechanisms for Entrepreneurial Activities”, Uzbek media reported.

According to the document, from Jan. 1, 2019, the claims of creditors secured by a pledge are satisfied from the value of the pledged property in calendar order of the date of making an entry in the pledge register of their rights to the debtor’s property in the event of default or improper performance by the debtor.

At the same time, this procedure does not apply to the sequence of debiting funds from the debtor’s account if they are insufficient to meet all the demands made on it.

The pledgee lenders who have made entries in the pledge register of their rights to the debtor’s property, have a preferential right to satisfy their claims before the pledgee lenders who have not made the corresponding entry in the pledge register.

The lender who financed the purchase of property under its security has a preferential right to satisfy his claims at the expense of this property, provided that he makes an appropriate entry in the pledge register.

Subsequent pledge is allowed provided that an appropriate entry is made in the pledge register without obtaining the consent of the previous pledgee.

The lease of the pledged property by the pledger is permitted without obtaining the consent of the pledgee, subject to the entry in the pledge register of the relevant entry and notification of the pledgee.

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