Uzbekistan targets ‘hidden’ utility debts in home sales

The Competition Promotion and Consumer Protection Committee has proposed removing a clause in property sale contracts that transfers outstanding utility debts to new owners, saying the practice breaches the law and undermines consumer rights.

Photo: Kun.uz

In a statement, the regulator said it had proposed removing provisions from notarized agreements that require buyers to assume debts linked to a property.

Inspections found that buyers of resale homes were sometimes held liable for unpaid utility bills left by previous owners. The committee said this was often due to delays in updating interagency databases, billing errors, or contract terms that do not comply with the law.

In one case in the Samarkand region, a buyer found no outstanding debts recorded in the Notarius system at the time of purchase, but was later told by a regional water utility that he owed UZS 13 million in arrears carried over from the previous owner.

The committee said that transferring such liabilities contradicts Article 21 of the consumer protection law, which deems contract terms that limit consumer rights invalid.

Under current procedures, mandatory checks for utility debts must be conducted before a property transaction is approved, and sales can proceed only if no arrears are found. Utility providers are responsible for ensuring billing data is accurate and up to date.

Following a review of the Samarkand case, the national water utility identified a data entry error by a former employee and canceled the UZS 13 million debt.

The committee said clauses obliging buyers to settle legacy debts have no legal force and should be excluded from contracts. It has submitted its proposal to the Ministry of Justice for consideration.