LAW
of the Republic of Uzbekistan
"On Securities Market"
22.07.2008
N ZRU-163
Adopted by Legislative Chamber
on February 13, 2008
Approved by the Senate on June 27, 2008
CHAPTER 1. GENERAL PROVISIONS (Articles 1-3)
CHAPTER 2. SECURITIES ISSUE (Articles 4-12)
CHAPTER 3. PLACEMENT AND CIRCULATION OF SECURITIES (Articles 13-18)
CHAPTER 4. PROFESSIONAL ACTIVITY IN THE SECURITIES MARKET (Articles 19-30)
CHAPTER 5. BOOKKEEPING OF RIGHTS TO SECURITIES (Articles 31-37)
CHAPTER 6. INFORMATION DISCLOSURE ON SECURITIES MARKET (Articles 38-47)
CHAPTER 7. REGULATION OF SECURITIES MARKET (Articles 48-52)
CHAPTER 8. RIGHTS, DUTIES AND RESPONSIBILITIES OF SECURITIES MARKET PARTICIPANTS (Articles 53-57)
CHAPTER 9. FINAL PROVISIONS (Articles 58-64)
CHAPTER 1. GENERAL PROVISIONS
Article 1. The purpose and scope of this Law
Article 2. The Law on securities market
Article 3. Basic terms
Article 1. The purpose and scope of this Law
The purpose of this Law is to regulate relations arising in securities market.
This Law applies to the following securities: shares, corporate and government bonds, certificates of deposit, derivative securities, and promissory notes.
Article 2. The Law on securities market
The legislation on Securities Market consists of this Law and other acts of the legislation.
Features of placement, circulation, keeping, account of the state securities are defined by the Legislation.
If the international treaty of the Republic of Uzbekistan sets rules other than those specified by this Law, the rules specified by the international treaty shall be applied.
Article 3. Basic terms
The following basic terms shall be applied in this Law:
the share (stock)- inscribed emissive security of a perpetual maturity, certifying the right of its owner to receive part of the profit of a joint stock company in the form of dividends, to participate in the management of a joint stock company, and to receive part of the property that remains after its liquidation;
information disclosure- provision of information availability to related parties in securities market regardless of the aims of the interested parties in obtaining this information, in a form that guarantees locating and obtaining it;
the promissory note- a non-emissive security certifying the unconditional obligation of the issuer, or any other party indicated in the note, to make a certain amount of payment to the holder of the promissory note at a predetermined date prescribed in the note;
the government securities - debt obligations of the Republic of Uzbekistan, bonds issued by the body authorized by the Cabinet of Ministers, as well as bonds of the Central Bank of the Republic of Uzbekistan;
depo account - a set of records in the bookkeeping registers of an investment intermediary and the Central securities depository for preserving a depositor's securities and rights on securities;
statement from depo account - a document, issued by the investment intermediary and (or) the Central securities depository, certifying the rights of the depositor to securities;
the depository operations-operations conducted in books of registers in compliance with the standards of depository operations;
the certificate of deposit -non-emissive security certifying the sum of money deposited in a bank, rights of the depositor (certificate holder) to receive the original deposit with a stated interest upon maturity of the certificate from any branch of the bank that issued this certificate;
the depository's book of registers- a system of records set by the standards of the depository operations, for storage of securities, and book-keeping of rights on securities in the investment intermediary and in the Central securities depository;
the depositor- a person who holds a depo account;
investment assets -securities, monetary funds and other properties recognized as investment assets according to the legislation;
the investor– a legal or a physical entity acquiring securities on his/her own behalf and at his/her own expense
the corporate bonds- bonds issued by open joint-stock companies and commercial banks irrespective of their organizational-legal form.
non-emissive securities- securities that do not fall within the concept of emissive securities according to this Law;
the bond- is an emissive security certifying the right of its holder to receive the face value or other equivalent property, a fixed percentage interest of the face value, and other property rights in the period of time provided for by it
the stock exchange- a legal entity creating conditions to promote trading exclusively with securities via organizing, and conducting public auction trades based on established rules, at a predetermined place and time;
registered securities- securities, whose exercise of property rights requires the owners to be registered;
emissive securities- securities, possessing within an issue homogeneous features and properties, placement and circulation of which are carried out under the terms of that particular issue;
the unified state register of emissive security issues-a list of registered emissive security issues;
an issuer- a legal entity, issuing securities and bears obligations over such securities before their owners;
option – an emissive security certifying right to buy a certain number of securities at a fixed price, and within the time period specified therein from its issuer;
treasury bonds of the Republic of Uzbekistan- emissive securities certifying monetary funds deposited into the state budget of the Republic of Uzbekistan by holders, and conferring the right to receive a fixed income throughout the period of ownership of those securities;
securities- documents certifying either proprietorship rights or debt relations between the issuer and the owner, prescribing profit payments in the form of dividends or interest as well as possible transfer of rights on these securities to other entities. The value of a security is expressed in national currency of the Republic of Uzbekistan;
securities market- a system of relations between legal and physical entities associated with the issue, placement and circulation of securities;
securities market participants– securities issuers, securities holders, investors, professional participants of securities market, as well as exchanges and the Central securities depository;
professional participant of securities market - a legal entity that carries out professional activity in securities market;
the client of a professional participant of securities market (client)- depositor or other entity using the services of professional participant of securities market;
professional activity in securities market- type of licensed activity on provision of services related to issuance, placement and circulation of securities;
security transactions- purchase and sale, gift, inheritance of securities, inclusion of securities into the statutory fund and other acts involving change of ownership of securities and as well as pledge of securities;
futures on securities- an emissive security certifying the obligation to buy or sell a certain number of securities at a fixed price, and within the time period specified therein;
placement of securities- the transfer of issued securities by the issuer to the first owners through a registered transaction;
the Central Securities Depository- a state depository, which provides a single storage system, and book-keeping of the rights and movements of emissive securities on the custody accounts;
circulation of securities- purchase and sale, and other actions undertaken with respect to securities resulting in the change of ownership of securities;
nominal holder of securities– an investment intermediary, the Central securities depository, carrying out instructions of the owner of securities or authorized person and registration/certification of rights to securities, while not being the owner of these securities;
securities issue – the actions of a legal person directed on occurrence of securities as an object of the civil rights;
owner of securities – a legal or a physical entity to whom securities belong on the property right or other proprietary interest;
the register of securities owners- the list of securities owners formed as of a certain date, indicating the name, quantities, par values, form and type of inscribed securities held by each owner in addition to the contact details of each entity recorded in the register
securitiesissue -the act ofissuance and placement of emissive securities;
securities issue prospectus- a document containing information about the issue and securities issued as well as other information which may affect the investor's decision to acquire the securities;
derivative securities- securities, certifying the rights or obligations of their owners in relation to other securities issued by legal entities, such as the stock options, futures on securities, depository receipts and other financial instruments.
infrastructure bonds –bonds issued by business companies and government enterprises for attraction of monetary funds for financing of creation and (or) reconstruction of industrial or other infrastructure;
clearing – determination, clarification and offset of mutual obligations under transactions with securities registered by securities trading organizers;
a market-maker – investment intermediary assumed liability on conclusion of exchange transactions for maintenance of a price level, supply and demand on securities;
netting – a method of clearing by offset of all monetary claims of a client against his/her liabilities.
CHAPTER 2. SECURITIES ISSUE
Article 4. Form of securities issue
Article 5. Decision on emissive securities issue
Article 6. Terms of corporate and infrastructure bonds issue
Article 7. Terms of stock option issue
Article 8. State registration of emissive securities issue
Article 9. Refusal in the state registration of emissive securities issue
Article 10. Fees for the state registration of emissive securities issue and/or to make amendments into the previously registered securities issues
Article 11. The Unified State Register of emissive securities issues
Article 12. Suspension of emissive securities issue, recognition of the securities issue as unsuccessful or invalid
Article 4. Form of securities issue
Depending on the form of an issue, securities may be documentary - in the form of blanks - or non-documentary - in the form of entries in the book of register of a depository.
The form of securities issue is determined by a decision on securities issue in accordance with the legislation.
Shares, corporate and infrastructure bonds, as well as depository receipts are issued in non-documentary form.
Bonds are issued for legal and (or) physical persons.
Article 5. Decision on emissive securities issue
The decision on emissive securities issue must contain the following:
full name of an issuer, its address (postal address);
date of approval of the decision on emissive securities;
name of the managerial body of an issuer, which approved the decision on emissive securities issue;
name of emissive security and form of the issue;
rights of the emissive securities owners;
conditions of emissive securities placement;
quantity of emissive securities being issued;
quantity of emissive securities already placed;
face value of emissive security;
Decision on emissive securities issue may contain other provisions according to the legislation.
Decision on emissive securities issue must be approved by the managing body of the issuer in compliance with the legislation and the issuer’s statute.
Decisions on bond issues, fulfillment of obligations being additionally collateralized by banking guarantees or secured by a other means set forth by the legislation, must contain information on entities involved in provision of additional collateral as well as on terms and conditions of provision. In such instances, the decision on bonds issue must be signed by the entity providing the additional collateral.
Decision on stock issue, as in the process of reorganization of the state-owned enterprise into joint-stock company, is stock issue prospectus approved by the State Committee of the Republic of Uzbekistan on privatization, demonopolization and development of competition.
Following the state registration of emissive securities issue, one copy of the decision on securities issue remains with the authorized state body on securities market regulation, one copy is submitted to the issuer, and one copy along with the documents affirming the securities issue shall be presented to the Central Securities Depository.
Introduction of amendment and addenda as well as admittance of registered decision on emissive securities issue recognized being void is carried out in a manner established by the legislation.
Article 6. Terms of corporate and infrastructure bonds issue
Corporate bonds are issued with observance of the following conditions:
within the size of their own capital as of the date of decision on bond issue, confirmed by the conclusion of the auditing organization;
by issuers having positive indicators of profitability, financial solvency, financial stability and liquidity for the past three years, confirmed by the auditing organization, as well as by obtaining an independent credit rating, as established by the legislation;
with participation of commercial banks acting as payment agents for the payment of funds payable to investors by issuers.
Infrastructure bonds are issued with observance of the following conditions:
within the size of an issuer’s own capital as of the date of decision on bond issue, confirmed by the conclusion of the auditing organization, and additional collateral on issue;
funds from placing of infrastructure bonds are used for financing of a project provided in the decision of the President of the Republic of Uzbekistan or the Cabinet of Ministers of the Republic of Uzbekistan;
issuer’s obligations on infrastructure bonds are insured until their complete redemption according to the established procedure.
Government enterprises may issue infrastructure bonds with the consent of the Ministry of Finance of the Republic of Uzbekistan.
Funds received from placing of infrastructure bonds are accumulated on a separate bank account and are used according to a decision of the supervisory board or the issuer’s supreme managing body, which supervises their target use.
Article 7. Terms of stock option issue
Terms of stock option issue may stipulate restrictions for their circulation.
A joint-stock company is not entitled to place stock options, if quantity of declared shares of this company is less than quantity of shares, acquisition of which is granted by such options.
Decision on issue of a premium or incentive payment to the employees and members of the supervisory board of a joint-stock company in the form of stock options is adopted by general meeting of shareholders.
Quantity of shares of certain type, acquisition of which is granted by options, must not exceed 5 percent of shares of this type placed on the date of submission of documents for the state registration of stock options issue.
Placement of stock options is allowed after complete payment of the registered capital of a joint-stock company at its foundation.
Article 8. State registration of emissive securities issue