October 31, 2025

State Control over the Attraction of Bank Loans and Foreign Debt by Large Enterprises of Systemic Importance

1. Introduction

On 24 October 2025, the Cabinet of Ministers of Uzbekistan adopted No. 670 “On Further Improvement of the System of Attracting Bank Loans and Foreign Debts by Large Enterprises of Systemic Importance for the Economy of Uzbekistan.” (hereinafter – “Resolution”)

The Resolution will come into force on 1 January 2026, replacing Resolution of the Cabinet of Ministers No. 107 of March 9, 2022, “On Measures to Improve the Procedure for Attracting Foreign Debts by Enterprises with State Participation”.

Resolution No. 670 introduces new risk assessment criteria, as well as updated notification and approval procedures for attracting Bank Loans and Foreign Debts. Unlike the previous framework, it may also apply to private companies that are recognized as large enterprises of systemic importance to the economy and subject to special monitoring.

The Resolution specifies that its purpose is to regulate the attraction of bank loans and foreign debt by large enterprises of systemic importance to Uzbekistan’s economy, enhance the accountability of their management bodies and authorized banking institutions, and manage risks associated with large debtors that could affect the country’s macroeconomic stability.

2. Scope of Application

The Resolution approves the Regulation on the Procedure for Attracting Bank Loans and Foreign Debts by Large Enterprises of Systemic Importance to the Economy of Uzbekistan [Annex No. 2].

The Regulation establishes the procedure for controlling and monitoring the attraction of bank loans and foreign debts by large enterprises of systemic importance for the economy of Uzbekistan, enterprises belonging to them, and groups of enterprises interconnected with them (collectively, “Large Debtors”).

Regulation further defines the large debtor as – a large borrower, a group of interconnected borrowers or enterprises (excluding commercial banks) that are of systemic importance to the country’s economy, have a balance of financial debts of at least 50 million US dollars equivalent, and have the status of a legal entity.

For the purpose of the Regulation, financial debt includes bank loans (including the utilized and unused portions), leasing, bank guarantees, factoring, and letters of credit, foreign debt attracted from foreign financial institutions, and issued bonds and other financial liabilities.

The requirements of the Regulation do not apply to private enterprises that have no outstanding credit obligations to commercial banks and seek to attract foreign debt without a state guarantee [para. 2 of the Regulation].

It appears that by using the term “private enterprise,” the legislator intended to refer to entities that are not state-owned or do not have state participation in their charter capital, rather than organizations established exclusively in the legal form of a private enterprise [1].

3. Coordination Commission and Working Body

The Resolution provides for the establishment of a Coordination Commission for managing risks associated with large enterprises of systemic importance (the “Coordination Commission”). The Commission will comprise nine representatives from various state bodies, including the Ministry of Finance, the Central Bank, the Tax Committee, and the State Assets Management Agency.

The Resolution defines the following as the main tasks and areas of activity of the Coordination Commission:

approve the list of large entities of systemic importance requiring separate monitoring;
consider presentations on projects proposed to be financed by bank loans or foreign debts, attracted by large debtors;
make decisions on approving or rejecting the attraction of bank loans or foreign debts, and study the effectiveness of projects financed with these funds;
regularly monitor the financial condition of large debtors and develop proposals for their financial rehabilitation in case of deterioration of their financial condition.

In addition, the Resolution designates Working Bodies responsible for implementing and overseeing relevant procedures:

The Ministry of Economy and Finance of Uzbekistan, in matters related to the attraction of foreign debts by entities with state participation;
The Central Bank of Uzbekistan, in matters related to the attraction of bank loans by all large entities and groups of entities affiliated with them.

4. Procedure for Determining Large Debtors and Risks

The Coordination Commission shall approve, on an annual basis, a list of large debtors based on analytical data and submissions provided by the respective Working Bodies.

Once the list of large debtors is approved, the designated enterprises are required to:

within three months, establish their organizational and legal form as a joint-stock company;
submit quarterly financial reporting forms prepared based on national accounting standards or quarterly financial reporting forms prepared based on international financial reporting standards.

Based on the level of risk to the financial condition of large debtors, financial debts are raised by large debtors with the permission of the Coordination Commission or with its notification.

The financial condition of large debtors is categorized into three levels of risk: low, medium, and high.

Pursuant to the Resolution, and with the technical assistance of an international consulting company, a manual for assessing the financial risk levels of enterprises shall be developed. Until the manual is approved by the Coordination Commission, the risk level shall be determined using the formulas and system set out in Annexes 2 and 3 to the Regulation.

The risk level of large debtors is assessed on a 100-point rating system. Entities are classified as “high risk” if their rating is below 60 points, “medium risk” if their rating is between 60 and 80 points, and “low risk” if their rating is between 80 and 100 points.

The cases when permission from the Coordination Commission is required for the attraction of financial debts by the large debtors:

In the case of “high risk”, the amount of new financial debt raised exceeds 1 percent of the balance of existing financial debts or the equivalent of 5 million US dollars.
In the case of “medium risk”, the amount of new financial debt raised exceeds 5 percent of the balance of existing financial debts or the equivalent of 20 million US dollars;
In the case of violation of financial conditions (covenants) of agreements on existing financial debts, until they are eliminated;
If the rating given by international rating agencies for the financial year decreases compared to the previous year’s rating.

The cases when notification of the Coordination Commission is required for the attraction of financial debts by the Large Debtors:

“low-risk”, regardless of the amount of new financial debt being raised;
“medium-risk”, if the amount of new financial debt being raised is less than 5 percent of the balance of existing financial debts or the equivalent of 20 million US dollars;
“high-risk”, if the amount of new financial debt being raised is less than 1 percent of the balance of existing financial debts or the equivalent of 5 million US dollars.

5. Procedure for obtaining permission from the Coordination Commission

In order to obtain permission from the Coordinating Commission for raising financial debts, large debtors shall submit the following documents to the working body through the responsible organization:

application for raising financial debts;
project concept (passport) in the form specified in Annex 4 to the Regulation;
a copy of the audit organization’s conclusion at the end of the reporting year;
a decision of the management body of the large debtor on raising financial debts;
a decision of the authorized body of the bank when a financial debt is provided by a commercial bank.

At the request of the working body, other information on the financial condition of the large debtor may be required.

The working body shall consider the application and, based on its results, if the documents in the Regulation are incomplete or if additional documents are required to be studied, it shall notify the responsible organization within 2 working days; if the documents are complete, it shall submit the relevant documents to the Coordination Commission within 10 working days.

The members of the Coordination Commission shall review the submitted documents and vote on granting or denying permission, and the decision of the meeting shall be adopted by unanimous vote of the members present at the meeting.

6. Monitoring of Large Debtors

The organization responsible for the balance of financial debts shall submit the following documents to the Working Body within 30 days from the end of each quarter, and by March 1 of the next financial year for the results of the year:

Information on the effectiveness of project implementation during the reporting period and plans for future stages;
Detailed data on all financial debt transactions, including external and internal loans in both foreign and national currencies, bank loans (including unused portions), leasing, bank guarantees, factoring, letters of credit, principal debt balances, interest and commission payments, and information on overdue payments and fulfillment of obligations;
Statistical and financial data necessary for monitoring the effectiveness of projects financed through newly attracted financial debts, upon request of the Working Body.

When the financial condition of large debtors deteriorates, the Coordination Commission makes recommendations on the use of the following financial methods for their financial rehabilitation:

Obtaining new loans on more favorable terms (foreign or domestic) to refinance existing debt;
Renegotiating debt terms, such as extending maturities, adjusting payment schedules, reducing interest rates, or changing the currency of obligations;
Restructuring enterprise management, including appointing external managers, liquidating inefficient assets or projects, and optimizing the management structure;
Debt-to-equity conversions to reduce outstanding obligations;
Raising additional capital through new share issuance or attracting new investors;
Optimizing production costs by reducing unnecessary expenses and improving resource efficiency;
Ensuring efficient use of fixed assets through the sale or leasing of inactive assets;
Accessing subsidies or other forms of state support; and
Restricting the attraction of new loans or the participation of debtor enterprises in state programs and investment projects.

[1] In accordance with the legislation of Uzbekistan, a private enterprise is an organizational and legal form of commercial organizations and is defined as a “commercial organization established and managed by a single individual owner” [Article 2 of the Law “On Private Enterprise” No. 558-II of December 11, 2003].

State Control over the Attraction of Bank Loans and Foreign Debt by Large Enterprises of Systemic Importance

1. Introduction

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