Uzbek Lawmakers Review Shared Construction Bill

Uzbek Lawmakers Examine Shared Construction Legislation

Tashkent, Uzbekistan (UzDaily.uz) — The Committee on Entrepreneurship, Competition Development and Industry of the Legislative Chamber of Uzbekistan's Oliy Majlis has conducted an initial review of a proposed law concerning the construction of apartment buildings and other real estate projects through shared-equity participation.

This legislation aims to regulate the relationships between developers and participants in shared-equity construction initiatives while enhancing protections for homebuyers.

As reported by the press service of the Legislative Chamber, the volume of construction activities in Uzbekistan has surged 17.5 times in recent years. However, with this growth, systemic issues have become more evident, such as some developers not meeting construction deadlines, insufficient protection for buyers under shared-equity agreements, and delays in the completion of residential buildings.

Lawmakers pointed out that the increasing number of inexperienced developers has contributed to a rise in problematic construction projects. Furthermore, the absence of a dedicated law governing shared-equity construction adds extra risks for homebuyers.

The proposed legislation aims to establish a legal framework for attracting investments from individuals and legal entities for the construction of apartment buildings and other real estate projects. It also seeks to enhance the current shared-equity construction mechanism and provide safeguards for the rights, legitimate interests, and financial resources of project participants.

During the discussions, lawmakers raised questions regarding several provisions of the bill and suggested amendments. The draft is currently under review with industry experts and is being prepared for submission to the Legislative Chamber.

Previously, on June 10, during a presentation on enhancing urbanization and urban planning reforms, officials noted that the volume of apartment construction funded through shared-equity participation had increased 2.5 times in recent years, surpassing 11 million square meters by 2025.

Simultaneously, the number of violations within the sector has escalated. According to data shared at the meeting, nearly 3,000 individuals experienced losses from problematic construction projects last year, with total damages reaching 668 billion soums.

A significant aspect of the proposed law is the introduction of an escrow account mechanism. This proposal stipulates that buyers' funds would be held in designated accounts at authorized banks and released to developers only after they fulfill their contractual obligations. In the event of a contract termination, buyers would receive a full refund of their payments.

Additionally, the bill includes plans for the establishment of a unified digital platform, Uy-joy, which will provide information on developers, permits, construction projects, project progress, escrow accounts, and shared-equity agreements.

Moreover, a comprehensive digital system for managing construction projects is envisioned, utilizing unique identifiers and digital passports for buildings to facilitate monitoring throughout the entire construction lifecycle.