Case Analysis

Over the past year, Business Ombudsman received 3,202 complaints of entrepreneurs, 2,706 of which were resolved in their favor. As a result of the analysis of the complaints conducted by the officers of the Business Ombudsman, it was identified that 33% of received complaints were related to decisions (actions) of local authorities, 12.3% - to the allocation of land, 12% - to the actions of regulatory authorities, 10% - to the activities of banks, the remaining 19.4% of complaints were related to other areas.   

In the sphere of protection of rights of entrepreneurs, 134 requests, 11 conclusions, 66 warnings, and 138 protocols on administrative liability were drawn up. As a result of the applying measures with legal impact, disciplinary actions were taken against 203 officials, while 114 officials were brought to administrative liability. Moreover, 211 illegally adopted decisions of state bodies were canceled.

Thus, 76 lawsuits were filed to the courts to invalidate decisions of regulatory bodies and local authorities in the total amount of 22.6 billion soums. Claims worth 21 billion soums were resolved in favor of entrepreneurs, 18 decisions of governmental authorities were declared invalid. The remaining appeals are under consideration of relevant organizations.

Assistance in launching the equipment

Entrepreneurs, in the course of their activities, also face the problem of installing and launching imported equipment. At the initiative of the Head of the republic, the Business Ombudsman conducts the meetings with entrepreneurs, which are aimed at taking measures on launching equipment imported in the period of 2016-2019. As a result of studies conducted during meetings with entrepreneurs, it was established that 453 business entities encountered problems in launching their equipment. As a result of the measures taken by the officers of the Business Ombudsman, 420 enterprises launched their equipment and started production. To date, Business Ombudsman conducts the work on promoting the remaining enterprises facing the problems with launching the imported equipment.

It is noteworthy that from the 1^st August, 2019, equipment worth $ 315 million was imported into Uzbekistan 2,052 business entities. Of these, 1 317 units of equipment were launched, that consequently enabled to create 25,255 new jobs. According to estimates, the annual output of the abovementioned enterprises is 3.7 trillion soums, including export volume of $187 million.

Ensuring the validity of inspections

In accordance with the Decree of the President of the Republic of Uzbekistan “On measures to radically improve the system of protecting entrepreneurial activity and optimizing the activities of prosecution authorities” dated March 15, 2019 №UP-5690, the Business Ombudsman is responsible for coordinating inspections of activities of business entities, as well as for implementing control over the legality of inspections by state bodies. Speaking of inspections, it is worth noting that according to the Decree of the President of the Republic of Uzbekistan ‘On the state program for implementing the strategy of action in five priority areas for the development of the Republic of Uzbekistan in 2017 - 2021 in the “year of support for active entrepreneurship, innovative ideas and technologies” dated January 22, 2018 №UP-5308, a two-year moratorium on audits of the financial and economic activities of business entities was declared. Due to this moratorium, inspections were conducted only in coordination with the authorized body and inspections in the order of notification.

Starting from the 1^st April, 2019, a Unified Electronic Registration System of Inspections was introduced.

Over the past year, as a result of identifying the cases of legal violations committed by individuals and legal entities, regulatory authorities requested for conducting inspections of 1,248 business entities. Of all these requests, 719 (58%) were approved, 529 (42%) were rejected due to the lack of sufficient grounds for conducting inspections.

Starting from the 1^st April, 2019, the Business Ombudsman constantly monitors the coordination of inspections of the activities of business entities, as well as the legality of their conduct by regulatory bodies.

The Business Ombudsman drafted the order “On approval of a temporary regulation on the procedure for coordination and conduct of inspections in the activities of business entities by regulatory bodies”. This project was agreed with 39 regulatory authorities and sent to the Cabinet of Ministers. At the same time, a draft Law of the Republic of Uzbekistan “On state control of the activities of business entities” was proposed, which, after consensus with all responsible bodies, was presented to the Ministry of Justice. 

Moreover, the officers of the Business Ombudsman conducted evaluations on competency and, based on the results of the evaluations, issued special certificates to 7 614 officials of 16 regulatory bodies with the right to conduct inspections.

In order to avoid unreasonable interference into the activities of business entities, as well as to ensure the lawful conduct of inspections, the Business Ombudsman provides special trainings and seminars in all regions of the republic for officials of governmental bodies that are authorized to conduct inspections.

Rehabilitation of business entities

Considerable work has been carried out with the purpose of reducing the number of enterprises that have suspended their activities. The Business Ombudsman, in cooperation with the khokimiyats (local administrative bodies), conducts meetings with entrepreneurs, who have ceased their activities, and takes measures to restore their business.

As of December 1, 2019, 761,248 business entities were registered in Uzbekistan (437,194 legal entities, 324,054 individual entrepreneurs). In cooperation with the responsible authorities, the Business Ombudsman assisted in the restoration of 47,304 business entities.

In addition, a series of training seminars were held last year in Andijan, Namangan and Tashkent regions in cooperation with khokimiyats and the Youth Union with the purpose of attracting young people to entrepreneurship and raising awareness among entrepreneurs who suspended their activities. It is noteworthy that economists as well as experienced and successful entrepreneurs also took part in these events.

 Improvement of legal acts

Throughout 2019, the Office of the Business Ombudsman conducted meetings with entrepreneurs in all regions of the country on an ongoing basis. These meetings enabled to learn and discuss the problems in the sphere of business, to receive proposals and recommendations on eliminating bureaucratic obstacles. Thus, as a result of these meetings, more than 300 proposals on legal, technical, economic and entrepreneurial protection of the rights of almost 100 draft legal documents, related to entrepreneurial activity, were received. 

For example, on the basis of the proposals made by entrepreneurs, the Business Ombudsman drafted more than 10 legal acts on radical improvement of the system of support and protection of business activities. Decrees of the President of the Republic of Uzbekistan “On measures to radically improve the system of support and protection of entrepreneurial activity” dated May 14, 2019, “On measures to simplify the procedure for the elimination of business entities” dated June 7, 2019, as well as the Decree of the President of the Republic of Uzbekistan “On additional measures state support of public associations of persons with disabilities” on August 23, 2019.

The international cooperation

The Business Ombudsman pays special attention to the strengthening cooperation with representatives of foreign law enforcement agencies, international organizations, national authorities of foreign countries, and other institutions involved in protection of rights and legitimate interests of business entities. In particular, Business Ombudsman  signed memorandums of cooperation with the Business Ombudsmen of Kazakhstan, Russia, and Georgia. Such agreements allow us to quickly solve many problems of entrepreneurs, in particular problems in carrying financial activities.

Over the past year, with the aim of developing cooperation and attracting foreign investment in the country and protecting the rights of entrepreneurs, more than 15 individual meetings were held with the ambassadors of Great Britain, Korea, Russia and Japan. Contacts were also established with the European Bank for Reconstruction and Development, the Organization for Security and Cooperation in Europe, the Konrad Adenauer Foundation, the World Bank, the Organization for Economic Cooperation and Development, the Korea International Cooperation Agency, the Japan International Cooperation Agency, and other international organizations.

Finally, it’s noteworthy that in Uzbekistan there are many organizations that are responsible for the development of entrepreneurship. Nevertheless, the Business Ombudsman has the powers and functions that bring fruitful results. The institution of Business Ombudsman seeks to more effectively use its potential in supporting small businesses and private entrepreneurship, which are the “locomotive” of the country’s economy.