Competition Committee warns developers over widespread contract violations and missed deadlines

The Competition Promotion and Consumer Protection Committee has reported a sharp increase in grievances related to the construction sector. While the watchdog handled 1,706 complaints throughout the entirety of 2025, it has already registered nearly 1,000 applications during the first quarter of this year alone.

The regulatory body pointed to widespread issues across the industry, noting a frequent failure to comply with legal standards. Property buyers most commonly reported substandard workmanship, charges for services that were never actually provided, severe delays in project completions, and the use of materials that do not meet technical specifications. Additionally, developers frequently broke promises made during the initial marketing and design phases.

The committee noted a worrying trend of developers collecting advance payments from buyers for residential buildings that had not yet received formal construction permits.

Given these risks, officials have urged citizens to meticulously review all terms in sales and purchase contracts, regardless of whether they are entering a shared-equity construction agreement or buying a completed apartment in a new development. Buyers are advised to carefully scrutinize the balance of rights and obligations between both parties, explicitly verify the scheduled completion dates, and check the financial penalties applied if deadlines are missed.

In Uzbekistan, only companies officially registered in a specialized electronic database are legally permitted to engage in equity-shared construction. To further enhance transparency and build consumer trust, the government is introducing an escrow-account system under a presidential decree, ensuring that buyer funds are protected until construction milestones are met.

Developers have also been strictly warned against infringing upon citizens’ rights. Under the Law on Consumer Protection, buyers retain the right to freely choose goods and services, dictate quality requirements, and demand compensation for both material and moral damages. Any contract clause that undermines consumer rights or contradicts standing legislation is automatically considered invalid.

The country's constitution guarantees entrepreneurial freedom but places a clear priority on consumer rights. Similarly, the Law on Guarantees of the Freedom of Entrepreneurial Activity mandates that businesses must strictly respect consumer protection and competition laws. To comply, construction firms must establish realistic, transparent construction timelines based on their actual capacity to finish the work.

Looking back at the data from 2025, the committee noted that the majority of the 1,700 construction-related complaints focused on poor renovation quality (42.9%) and major issues with utility connections (40.8%). The watchdog successfully resolved 76% of these cases in favor of the consumers, securing the return of UZS 22.1 billion to aggrieved buyers.

The regulatory authority concluded by highlighting the structural flaws hidden inside standard developer contracts. Most disputes arose because contracts failed to specify exact handover dates, late-delivery penalties, calculation methods for price adjustments, structural warranty periods, or clear dispute-resolution mechanisms.