Uzbekistan overhauls LLC legislation to modernize corporate governance

The revised Law “On Limited Liability Companies”, drafted by the Ministry of Justice and signed by the president on April 21, aims to modernize governance standards, address legal gaps, and strengthen protections for company participants.

The law comprises 71 articles and will take effect three months after its official publication. Authorities stated that its provisions were developed with input from domestic and international experts and reflect global best practices.

Under the new rules, the powers of supervisory boards are formally defined, including procedures for appointing members. The law also introduces absentee voting through written polling and establishes fiduciary duties for members of supervisory and executive bodies.

Furthermore, it allows companies to engage in certain activities not only under licenses but also on the basis of other permits or notifications, potentially easing regulatory requirements for businesses.

The legislation also sets out procedures for establishing branches, representative offices, subsidiaries, and affiliated companies.

*Fiduciary duties are legal obligations requiring one party to act in the best interests of another, placing those interests above their own.