April 21, 2025

Shareholders agreement in Uzbekistan: subject matter and dispute resolution

1. Subject Matter of a Shareholders Agreement

The shareholders agreement – AKA a corporate agreement – provided in Article 358-1 of the Civil Code of the Republic of Uzbekistan (CC RUz) does not fall under the category of a “founding agreement” as defined by the Laws “On Limited Liability Companies” and “On Joint Stock Companies and the Protection of Shareholders’ Rights” (hereinafter – the Laws on LLCs and JSCs).

A corporate agreement governs the exercise of rights by participants of a limited liability company or shareholders of a joint stock company.

Under such an agreement, the respective participants of the business entity undertake to exercise their membership rights or to refrain (decline) from exercising them, including, but not limited to:

  • voting at the general meeting of the company’s participants;

  • acting in coordination in managing the company;

  • acquiring or disposing of shares (stock) in its charter capital (fund) at a specified price or upon the occurrence of certain conditions, or refraining from such acquisition or disposal.

A corporate agreement may not include provisions concerning mechanisms of corporate governance, including:

  • voting by participants in accordance with the instructions of the company’s bodies; and

  • determining the structure of the company’s bodies and their powers.

When concluding a corporate agreement, it is important to take into account potential conflicts between the charter, founding agreement, and the corporate agreement.

Articles 12 of the Law on LLCs and Article 10 of the Law on JSCs provide lists of matters that are subject to mandatory regulation by the charter and founding agreement. The scope of subject matter regulated by the founding documents may be interpreted by courts in Uzbekistan as exclusive. That is, in case of a conflict (either direct or interpretative) between the provisions of these three documents, a judge may proceed on the basis that matters explicitly assigned to the scope of regulation of the charter or founding agreement take precedence.

2. Dispute Resolution under Corporate Agreements

It is important to note that corporate disputes fall under the exclusive jurisdiction of the economic court and are filed at the location of the legal entity. According to Resolution No. 13 of the Plenum of the Supreme Court of the Republic of Uzbekistan dated May 24, 2019, “On Certain Issues of Application by the Court of First Instance of the Norms of the Economic Procedural Legislation,” the “list of corporate disputes is not exhaustive, and claims relating to disputes not specified in this article [Article 30] of the Economic Procedural Code, but which by their nature are considered corporate, shall also be filed at the location of the legal entity“.

Therefore, when concluding a corporate or other agreement regulating relationships between shareholders that is distinct from the founding agreement, and submitting disputes arising therefrom to the jurisdiction of arbitral tribunal or foreign courts, it is necessary to take into account the rule on exclusive jurisdiction specified in Article 30 of the Economic Procedural Code of the Republic of Uzbekistan.

It is also not uncommon for a corporate agreement to be concluded with the intent to have it governed by foreign law. In this regard, it is necessary to consider Article 1191 of the CC RUz, which states that “the law of the country where the legal entity is established shall apply to the agreement on the establishment of a legal entity with foreign participation”.