A mechanism is provided in Uzbekistan that allows the state to retain special participation rights in strategically important enterprises even after their privatization. This procedure is enshrined in a presidential decree concerning the reduction of state participation in the economy and the acceleration of the privatization process.
According to this document, a special right can be established to protect national interests, maintain economic stability, and ensure public needs. The potential buyer must notify in advance about the possible retention of such a right by the state before the start of the privatization procedure. After the privatization is completed, the state's right to participate is introduced by a separate decision of the President of Uzbekistan, and its cancellation is also possible only by a special decision of the head of state.
The decree does not specify what powers this special right will grant, nor does it contain a list of enterprises to which this mechanism will apply. It should be noted that in 2022, the institution of the 'golden share' was abolished in Uzbekistan, which gave the state representative the ability to join the supervisory board and block key decisions in privatized strategic companies.
Previously, the State Property Management Agency indicated that the 'golden share' had not been used for a long time and could negatively affect investor interest and the rights of other shareholders. The European Bank for Reconstruction and Development also expressed a similar recommendation to abandon this mechanism.
The previous list of strategic enterprises included companies from the production and service sectors, as well as the banking sector. Among them were Navoi Mining and Metallurgical Combine, Almalyk GMC, 'Uzmetkombinat', 'Uzbekneftegaz', 'Uzbekugol', 'Khududgaztaʼminot', UzAuto Motors, 'Uzkimysanoat', 'Navoiazot', 'Uzbekhidroenergo', 'Thermal Power Plants', 'Uztransgaz', and UzGasTrade.
This document is part of a broader package of measures to reduce the state's share in the economy. Within this program, the placement of state shares in 84 business associations, 1242 real estate objects, and about 8000 hectares of land plots intended for urban planning and entrepreneurial purposes is planned for auction. The President previously announced these plans during an open dialogue with entrepreneurs in August.
In addition, measures are provided for the liquidation and reorganization of 85 enterprises with state participation. Another 84 objects that were not previously sold must be put up for auction again with an initial price of 1 million soms. The total estimated value of the assets subject to sale is approximately 100 trillion soms, and the authorities expect to receive at least 14 trillion soms from their realization by the end of the current year.