In Uzbekistan, a new law has been adopted that paves the way for significant changes in the financial system. President Shavkat Mirziyoyev on March 27 signed a law aimed at introducing Islamic banking activities in the country. This document is considered an important step toward diversifying the economy and creating new financial opportunities.
The law is titled “On Amendments and Additions to Certain Legislative Acts of the Republic of Uzbekistan on the Introduction of Islamic Banking Activities in Uzbekistan” and is expected to start a new era in the country’s financial market.
Based on this document, relevant amendments and additions have been made to the Tax Code, Civil Code, and seven other laws. One of the most important innovations is the official introduction into legislation of new concepts such as Islamic banking activities, Islamic financial operations, Islamic financial standards, and investment deposits.
Additionally, a special licensing system has been introduced to carry out Islamic banking activities. Clear requirements have been established to obtain this license, ensuring transparency and order in the sector. A list of Islamic financial operations that banks with a license can carry out has also been approved.
Under the new rules, Islamic banks can not only provide financial services but also engage directly in commercial activities. Furthermore, they have the right to establish legal entities and acquire shares or stakes in companies without restrictions. This provides an opportunity to further expand the banks’ activities.
To coordinate the Islamic finance system, it is planned to establish special Islamic finance councils under the Central Bank and commercial banks. These councils will monitor standards and requirements in the sector.
The law also defines specific features of taxation for Islamic financial operations. This will help ensure the effective and stable functioning of the new system.
It is reported that the law will come into force three months after its official publication.
In short, this decision may open new opportunities for Uzbekistan’s financial market. If the system works properly, not only the banking sector but also the investment environment is expected to become significantly more active.
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