State aid – a form of support provided by the state to business entities and associations of legal entities that create for them advantages and more favorable conditions for production and the sale of goods.

State aid is provided to business entities and associations of legal entities in the form of tax benefits, deferred or installment payments of taxes, fees and other obligatory payments, customs benefits and exemption from customs payments, subsidies, price preferences and grants, exemption from obligatory payments on licensing and licensing procedures, loans on concessional terms, simplification of licensing and licensing procedures, as well as technical regulation requirements, etc.

Indirect government assistance may also be provided in the form of other actions affecting the general trading conditions on product and digital markets.

To date, the Committee, taking into account international experience, is developing a draft Regulation on the procedure for systematic monitoring of the assessment of the effectiveness of benefits, preferences and exclusive rights granted to business entities.

The draft Regulation provides for a comprehensive analysis of compliance with the requirements of competition law, the economic and social benefits of state aid and the effectiveness of its use as well as the impact on the competitive environment and impact on business.

Evaluation and monitoring of efficiency is envisaged to be carried out according to such indicators as the volume of production (work, services), the volume of exports, energy consumption, the introduction of new technological processes, equipment, production capacities, the introduction of new inventions, patents, industrial designs, research and development work, the creation of new jobs, the amount of funds aimed at increasing the wages fund, the number of competitors and the share of the private sector in the industry and in the total amount of benefits used, etc.

During the reporting period, the Committee conducted studies of tax and customs privileges and preferences granted to business entities taking into account their impact on the competitive environment in certain sectors of the economy, such as the electrical industry, auto and agricultural engineering, telecommunications, oil and fat industry, etc.

Based on the results of the studies, the relevant proposals were sent to the Cabinet of Ministers of the Republic of Uzbekistan.

Directorate  of Assessing the impact of legal acts and decisions of state authorities on competitive environment and effectiveness of state aid  

 

  1. In state aid management system

Directorate actively participated in the process of developing a new version of the Law of the Republic of Uzbekistan “On Competition”, proposals for state assistance were made. These proposals are included in the relevant articles on state aid of Law of the Republic of Uzbekistan “On Competition”, adopted on July 3, 2023.

In particular, Article 23 of this Law establishes possibility of providing state assistance in the form of preferential terms, other preferences and benefits to state economic entities of tax and customs benefits, subsidies, grants, state guarantees, soft loans, exclusive rights, sale and lease of state property under preferential prices, the right to use land resources and subsoil;

inadmissibility of providing individual economic entities with individual state assistance that negatively affects a healthy competitive environment;

mandatory submission of draft regulatory legal acts providing for the provision of state aid to the authorized state body to assess their impact on competition;

consideration on a mandatory basis when adopting regulatory legal acts providing for provision of state assistance,  conclusion of authorized state body based on results of assessment of impact on competition;

requirements set forth in part two of this article are valid except for cases provided for by the Decrees of the President of the Republic of Uzbekistan.

In addition, in accordance with Article 30 of this Law, one of the powers of the Committee is to exercise state control over the effectiveness of state aid provided in the form of benefits, preferences and exclusive rights to carry out activities, as well as to make proposals for their cancellation in the event of a negative impact on the competitive environment.