Learn about barriers to market entry and local requirements, i.e., things to be aware of when entering the market for this country.
Last Published: 7/3/2019

Protection of Intellectual Property Rights (IPR)

Insufficient IPR protection remains to be a challenge for foreign businesses in Uzbekistan.  Uzbekistan took important steps in 2018 to address longstanding issues pertaining to IP protection and enforcement.  In particular, Uzbekistan’s accession to the Geneva Phonograms Convention and two WIPO Internet Treaties represents progress towards adequate copyright protection for foreign sound recordings, as did two 2019 court decisions upholding the trademarks of prominent American brands.  Despite this progress and the Government’s efforts toward developing a new national strategy for improvement of IPR protection, IPR enforcement in Uzbekistan remains weak.  Uzbekistan continued on the Watch List in the most recent (2019) U.S. Trade Representative’s (USTR) Special 301 Report on

Intellectual Property. 
Overregulated Banking Sector
Three large state-owned and 13 partially state-owned banks control over 80 percent of the sector’s total assets and capital.  Privately-owned commercial banks are relatively small niche players.  State-owned banks are virtually the agents of the government in implementing government development strategy.  All banks are closely monitored by the government, which imposes non-core functions on them, including tax withholding and financial oversight of their clients.  The Uzbek economy remains largely cash-based due to relatively low trust in the banking sector and the huge role of the informal sector in the economy.  In recent years, however, the government’s policies have demonstrated a notable transition from financial isolationism to greater transparency and integration into international financial markets.  Last year, the government announced privatization efforts  to attract more investments from the non-public sector.   

Currency Issues
In 2017, the government started a currency liberalization reform by eliminating most  restrictions on buying foreign currency to finance imports.  However, this reform has yet to be completed.  Investors continue to experience difficulties related to repatriation of their capital and capital gain from Uzbekistan due to various banking limitations that are still in place.  For example, banks limit repatriation of income and capital invested in Uzbek industrial assets, securities and the stock market. 

Judicial System and Trade Legislation
In general, the judicial system upholds the sanctity of contracts, but if a government-affiliated entity is involved, judgments tend to favor the local partner.  U.S. firms should consult with a local attorney and develop relationships with Uzbek partners before entering the market.

State Involvement
State-owned enterprises dominate Uzbekistan’s economy and limit fair competition in some key industries, including but not limited to energy, telecommunications, automotive, aviation, chemical, mining, etc.  Government-owned banks, ministries, and agencies interfere in business operations and in some cases make efficient operations almost impossible.  Documents required for licensing, registration and other permits are often amended without notice, which creates an opportunity for rent-seeking. 
 

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