Public procurement in Uzbekistan for foreign companies

A foreign company may participate in Uzbekistan's public procurement as a non-resident (Art. 23, Public Procurement Law). A local legal entity is not a general eligibility requirement. The choice between bidding directly and using a local limited liability company (LLC) depends on the procurement requirements, delivery arrangements, the contractor's qualifications and tax consequences. Domestic-producer status is assessed separately from incorporation.

In brief:

• A foreign company may submit a bid in its own name; a local LLC is a separate bidder with its own qualifications.
• Eligibility is decided by the participant requirements and the lot's criteria; currency and payment arrangements are set by the tender documents (Art. 67, Procurement Law). In September 2026, 66 of the 660 open etender lots were priced in US dollars, 4 in euros and 1 in yuan.
• For services provided through personnel, the permanent-establishment threshold is at least 183 days (Art. 36, Tax Code) in a consecutive twelve-month period; a fixed place of business and a dependent agent involve different tests.
• Domestic-producer preferences follow the origin of the goods, confirmed by a certificate of local manufacture; a local importer of foreign goods gets none of them.
• The bidder should be the entity whose resources, documents and delivery arrangements meet the requirements of the selected procurement.

Updated: 07 September 2026

What the law allows

The law allows a foreign legal entity to bid in its own name. As a general rule, it therefore does not need to establish a subsidiary LLC simply to qualify as a participant. Direct participation means the foreign company itself is the bidder; the procurement procedure applies to it as to any other.

Participants have equal opportunities (Art. 10, Procurement Law). Eligibility depends on the particular procurement and special rules, including support for domestic producers. Soum lots are open to foreign companies that can deliver, invoice and be paid locally; in foreign-currency lots the participant requirements and the lot's criteria apply in the same way.

On 6 September 2026, of the 660 selections and tenders open on etender.uzex.uz, 589 were priced in soums, 66 in US dollars, 4 in euros and 1 in yuan; 13 of the 66 tenders were in dollars and carried most of the value, mainly large equipment purchases addressed to manufacturers or their authorised dealers, some with payment by letter of credit after delivery. The soum lots assume local delivery, an acceptance act, an electronic invoice in the state system and payment to a local account.

Procurement funded by foreign loans, grants and other assistance specified in the law may follow different procedures required by the funder (Art. 2, Procurement Law). First identify the rules governing the project, then assess the form of participation. An ordinary purchase by a budget-funded institution follows the Law and Regulation No. 276, whatever a donor-funded project allowed.

A foreign bidder must disclose its ultimate beneficial owner (Art. 23, Procurement Law) and is responsible for the accuracy of its documents and compliance of its bid. A participant and its affiliate may not participate in the same lot in an electronic shop, simplified small-value procurement, auction, selection procedure, tender or two-stage procurement. A parent and its controlled subsidiary should not submit competing bids for the same such lot.

Requirements for a foreign bidder

Foreign incorporation does not remove the qualification requirements. A participant must meet the following list of criteria (Art. 36, Procurement Law):

• have the technical, financial, material, staffing and other resources necessary to perform the contract;
• have legal authority to enter into the contract;
• have no overdue tax or levy liabilities;
• have no unfulfilled obligations under court decisions recorded in the databases of the Bureau of Compulsory Enforcement under the Prosecutor General's Office;
• not be subject to insolvency proceedings;
• have no entry in the Unified Register of Unscrupulous Contractors.

The customer may impose additional requirements (Art. 37, Procurement Law) connected with the characteristics of the goods, works or services. They must be announced in advance and comply with procurement principles. This is how the required resources, experience of comparable contracts, specialists and authorizations are assessed. No provision requires a foreign supplier to have operated in Uzbekistan for a period before bidding; where a commission scores financial standing, it does so on the documents the card lists.

In a tender, qualifications cannot be assessed against unpublished criteria (para. 155, Regulation No. 276), nor may documents absent from the tender requirements be demanded. This matters particularly for a new subsidiary: the group's experience does not automatically become the bidder's experience. Before selecting the LLC, establish whether the parent's contracts, the experience of engaged specialists and the partner's resources are accepted, and how they must be documented.

A participant may be excluded from the procurement (Art. 42, Procurement Law) for failing to meet qualification, technical or commercial requirements. This is one of the statutory grounds; the decision and its reasons must be recorded and communicated to the participant without delay.

This article addresses the choice of bidder and its qualifications. The article on supplier registration explains the account, electronic signature and bid submission process. It is relevant after checking that the selected company meets the procurement conditions.

Bidding directly as a non-resident

Direct participation is an option where the foreign company can demonstrate its own qualifications and perform the required delivery. It preserves a contract with the manufacturer, while import arrangements, taxes and personnel working in Uzbekistan remain separate issues.

Currency and documents

Tender documentation must specify the currency and payment arrangements (Art. 67, Procurement Law). It also requires the bid to be prepared in the state language and, where necessary, other languages. The language clause in the documentation decides whether a Russian or English package is accepted; a Russian or English notice is published for information.

In practice, compare the pricing currency, settlement currency, payment recipient, acceptance documents and bank details. Take letters of credit or payment after delivery into account where those terms appear in the tender documents. Read those conditions before pricing in a foreign currency.

Customs, VAT and the buyer's documents

Before choosing direct delivery, identify who will bring the goods into the country and arrange their import clearance. The Tax Code treats persons moving goods across the border (Art. 237, Tax Code) as import value added tax (VAT) payers, subject to customs legislation. The importer of record named in the customs declaration is the import-VAT payer; a freight forwarder carries the goods and does not take that role.

The import VAT base includes customs value and applicable charges (Art. 254, Tax Code): customs duty and excise tax payable on import. The standard VAT rate is 12% (Art. 258, Tax Code); exemptions for the particular goods must be checked separately.

Example. Assume the import VAT base has already been determined at UZS 100,000,000 and no exemption applies. Import VAT is 100,000,000 × 12% = UZS 12,000,000. Customs duty, excise where applicable and the customs fee come on top.

The right to credit import VAT (Art. 266, Tax Code) depends on meeting the Code's conditions, including payment of VAT on import and use of the goods in taxable activities. The credit belongs to the VAT-registered importer that meets those conditions. The documents must make clear who imports the goods and who subsequently sells them to the customer; a foreign seller's invoice is not an electronic tax invoice in the state system, which only a local taxpayer can issue.

A separate case is the purchase of services whose place of supply is Uzbekistan from a foreign person not registered as a taxpayer. The buyer then has tax-agent obligations (Art. 255, Tax Code). If the contract prices the service exclusive of VAT, the agent calculates and pays the tax itself. For example, a taxable service costing UZS 100,000,000 excluding VAT, at the standard 12% rate, gives rise to UZS 12,000,000 of such VAT.

This article explains how the allocation of import responsibilities affects the choice of supplier. The article on importation covers import formalities, while the VAT article explains credits and tax accounting. These issues are needed to calculate the full cost of delivery before setting a bid price.

Withholding tax

An ordinary foreign-trade supply of goods and a non-resident's services receive different tax treatment. Income from importing goods is not Uzbekistan-source income where the import exception conditions (Art. 351, Tax Code) are met: the transaction is exclusively in the supplier's own name and interest, the goods enter the import procedure, are not supplied from a storage location in Uzbekistan and are not sold through a permanent establishment. Sales from local stock or through an intermediary fall outside the exception and are Uzbekistan-source income.

If equipment is supplied with installation, commissioning, personnel training or similar services, the service price should be identified separately. Without that allocation, the services are valued at market price (Art. 351, Tax Code). The rule also takes account of the supplier's representatives being physically present during installation, even where the contract does not mention services. Installation priced inside the equipment total is still a service and is taxed as one.

For taxable non-resident income unrelated to a permanent establishment, the customer acts as tax agent and withholds tax on each payment (Art. 351, Tax Code). Ordinary technical or consulting services classified as other taxable income carry a domestic rate of 20% (Art. 353, Tax Code). Other categories (dividends, interest, royalties, freight) have their own rates under Art. 353.

Example. Assume taxable service income of UZS 100,000,000, no contractual increase to cover withholding, and no treaty relief. With tax calculated separately for the payment (Art. 354, Tax Code), the amount is 100,000,000 × 20% = UZS 20,000,000; the non-resident receives UZS 80,000,000. VAT in the preceding example is assessed separately.

A tax treaty may change the outcome. Evidence of tax residence must be provided no later than the income payment (Art. 357, Tax Code) to apply it. The permitted document formats, legalization or apostille and exceptions to authentication follow the tax-residence evidence rules (Art. 358, Tax Code). The exemption depends on the treaty and the certificate, not on incorporation abroad.

The complete list of taxable income and the agent's reporting obligations are outside this comparison. The article on non-resident withholding tax helps assess a particular payment, while the article on tax treaties explains the relevant international framework.

When a permanent establishment arises

Working in Uzbekistan does not always require a local LLC, but it may create a permanent establishment of the foreign company. A permanent establishment is a taxable presence of the foreign company itself. A direct contract with a non-resident can be performed through its permanent establishment.

The following are the principal permanent-establishment tests (Art. 36, Tax Code) relevant to supplies and contracting projects; Art. 36 lists further cases.

Exceptions exist for activities that are exclusively preparatory or auxiliary; for example, storage or display of goods is assessed in light of that purpose. Using a warehouse as a sales outlet is a different situation. Periods of related entities' activity at the same construction site or other specified project are aggregated under the Code. Where a permanent establishment arises, the tax obligations run from the start of the activity, not from the day the threshold is crossed.

The assessment is of the actual work and the applicable treaty, whatever term the contract states. A parent that continues its own activities meeting these tests has a permanent establishment even where a local LLC exists.

This article explains how a permanent establishment affects the choice of bidder. The article on permanent establishments covers tax registration and subsequent obligations. It is relevant where the foreign company retains the direct contract and sends personnel to Uzbekistan or establishes a place of business there.

Bidding through a local company

A local LLC allows supplies, imports, personnel and servicing to be organized through a separate counterparty. It acquires legal-entity status (Art. 3, LLC Law) upon state registration, acts in its own name and obtains the licenses or permits required for its activities. That gives it the capacity to operate; its procurement qualifications are the contracts, staff and resources it accumulates itself.

What the local company gives you

A subsidiary model is worth comparing for recurring deliveries, a warehouse and a local service team. Its contracts, employees, resources and documents must then match the offer made to the customer. The division between the foreign manufacturer and the local seller must be reflected in the supply arrangements and accounting.

An LLC may have a sole member (Art. 8, LLC Law). When designing a foreign ownership chain, check the restriction: another single-member company cannot be its sole member, except for a joint-stock company with one shareholder. Owning the company and being able to use the founder's qualifications are decided separately: the second depends on the lot's documents.

A tax regime cannot be chosen freely. Persons importing goods are excluded from turnover tax (Art. 461, Tax Code). An importing LLC is therefore a VAT payer from the start, with 12% output VAT on its sales and the credit for the import VAT it pays.

What the local company does not give you

A subsidiary remains a separate legal entity (Art. 7, LLC Law). The parent's licenses, completed contracts and personnel stay with the parent. For procurement, it must demonstrate the resources held by the bidder itself and which externally provided resources may be taken into account.

A representative office cannot replace such a contractor: it does not conduct commercial activity (para. 7, Regulation No. 76) and is not a legal entity. A special exception applies to foreign airlines' representative offices; an ordinary equipment supply does not fall within it.

Where the project requires land, the form of tenure must be assessed separately. Enterprises with foreign investment and foreign persons may lease land for up to 25 years (Art. 24, Land Code). Foreign-invested enterprises are ineligible to privatize land (Art. 13, Non-agricultural Land Privatization Law). An Uzbek LLC with foreign capital is inside that regime.

Company plus partner

A local partner may be needed for servicing, installation, personnel or other project resources. Whether its experience counts for a new LLC, and whether a joint consortium bid is allowed, is written in each lot's documents. The availability of that structure and the documents allocating roles must be checked against the procurement rules and documents. The bidder's own requirements apply in full alongside the partner's role.

Incorporation procedures are not covered here. The article on LLCs addresses the ownership structure, while the article on land and construction is relevant where performance requires a dedicated site. These issues should reflect which company will actually carry out the project.

Does a local LLC qualify for preferences

Registering an importer in Uzbekistan does not make its goods domestic. Production is confirmed by a certificate of local manufacture (para. 3, Regulation No. 712). A foreign manufacturer that wants the preferences has to localize production and document origin.

The Law permits special advantages where foreign suppliers compete alongside at least three domestic producers (Art. 16, Procurement Law). The current Price Preference Regulation, however, refers to two or more domestic producers (para. 4, Annex 3, Cabinet Resolution No. 41). The texts differ; the procurement documents state which rule the commission applies.

The preferences are four distinct mechanisms, each with its own trigger:

DDP means delivered duty paid; the provision uses the price for delivery in Uzbekistan. The price preference concerns products outside the list of temporary admission bans and restrictions. It does not apply to corporate customers' procurement for commercial resale of goods or their use in production for commercial purposes. The 15% price preference therefore applies to goods of Uzbek origin bought for the customer's own use.

Regulation No. 41 separately provides for reducing the price for evaluation (para. 13, Annex 3) of a domestic producer's bid. The base and limit in the presidential act, the Regulation's evaluation procedure and the procurement conditions must therefore be considered together.

Example. If the assumed DDP price of imported goods is UZS 100,000,000, a 15% price-preference limit amounts to UZS 15,000,000. The preference is applied when bids are compared; the contract price stays the price the winner offered.

Example. For the separate additional-points mechanism, assume a producer earned 80 points, verified localization is 60%, and the price condition is satisfied. Additional points are 80 × 15% × 60% = 7.2, giving a total of 87.2 points. If its price is more than 15% above the lowest offer, no such bonus is awarded. Which of the two mechanisms a given procedure uses is stated in its documents.

Which route for which lot

The choice depends on performance conditions and qualifications. The table compares the options for each type of lot.

Restrictions the customer must observe

The customer may not replace objective delivery requirements with an arbitrary preference for a local company. The Law prohibits discrimination and unjustified restrictions (Art. 46, Procurement Law). Requirements for local servicing or resources are assessed against the procurement's subject matter; a general preference for a local counterparty is not a lawful requirement.

The customer is also subject to a separate domestic-producer priority rule (para. 4, PP-4812): offers on new.cooperation.uz or the Producers' Ecosystem portal must be checked first, and purchasing on other electronic portals is linked to a portal certificate confirming the required goods, works or services are unavailable. An exception exists for cheaper domestically manufactured electrical products on other portals. This rule governs where the customer buys; it applies whatever the bidder's nationality.

What changed in 2025–2026

• From 1 January 2026, the rules provide for the Producers' Ecosystem, with purchasing priority for its producers and an exception for the specified international projects. The basis is PP-417 of 3 December 2024, as currently amended. From the same date, UP-259 of 26 December 2025 introduced local auctions between budget-funded customers and domestic producers.
• From 6 March 2026, the amended rule requiring domestic offers on new.cooperation.uz or the Producers' Ecosystem portal to be checked first applies, following PP-78 of 5 March 2026. It also covers auditing and tax advisory services.
• From 1 July 2026, PP-4812 of 21 August 2020 provides for a preference of no more than 15% of the imported goods' DDP price, with an exception for specified commercial procurement by corporate customers. For a foreign supplier, the customer's purchasing purpose matters alongside the origin of its own capital.

What to prepare before the first bid

Before technical registration and submission, prepare a working participation model for the particular procurement:

1. Identify the applicable procurement rules, the general or special procedure and whether foreign goods are eligible.
2. Select the bidder: the foreign company or a local LLC; rule out competing bids by affiliates for the same lot.
3. Compare the required experience, resources and authorizations with the selected bidder's own documents; assess separately whether a partner's resources may be used.
4. Allocate supply, import, installation and servicing responsibilities between the parties, and check the language of corporate and supporting documents.
5. Calculate import VAT and possible withholding, assess treaty application and identify permanent-establishment indicators.
6. Check currency, settlement documents and the cash-flow plan for performance, then prepare the bid.

The cash-flow plan is considered here as part of choosing the delivery model. The article on security, advances and contracts covers security, cash movements and performance obligations. It helps assess whether the selected bidder can finance the particular lot.

Frequently asked questions

Can a foreign company bid without a local entity?

Yes. The Law allows non-resident participation (Art. 23, Procurement Law). The foreign company must demonstrate compliance with the particular procurement and perform the required supply. A local LLC is not a participation requirement; the domestic-producer procedures and the tax consequences of working in Uzbekistan apply either way.

Do I need a local partner?

The participant rules do not impose a general obligation to engage a local partner solely because the bidder is incorporated abroad. A partner may be necessary for the actual organization of installation, servicing or other work. The customer may impose subject-specific additional requirements (Art. 37, Procurement Law). Whether the partner's experience counts and whether joint participation is allowed is written in the lot's documents.

How is a foreign supplier paid?

The tender documentation (Art. 67, Procurement Law) determines the pricing and settlement currencies and payment arrangements. A particular project may require different documents or payment methods. A foreign-currency notice implies neither a duty to create a local LLC nor payment by letter of credit; the documents say which applies. Before bidding, check the recipient, bank details, acceptance documents and potential withholding.

Will the customer withhold tax from our payment?

That depends on the income category, its connection with a permanent establishment and the applicable treaty. Ordinary imports of goods have a separate exception (Art. 351, Tax Code), while technical, consulting and related installation services must be assessed separately. Services included in an overall equipment price are taxed as services. Evidence of residence must be properly prepared and provided on time for treaty relief.

How long does it take to establish a company that can bid?

The incorporation period and procurement readiness are separate issues. Registration gives the company legal personality (Art. 3, LLC Law), but it must demonstrate the required resources and qualifications separately. There is no waiting period between registration and the first bid. When choosing the date of the first bid, assess the readiness of documents, authorizations, personnel and the experience that the particular procurement permits it to rely on.

Does a local company receive the domestic-producer preference?

Not merely because it is registered locally. Support mechanisms depend on domestic manufacture, goods' origin and evaluation conditions. A certificate of local manufacture (para. 3, Regulation No. 712) confirms production by a local enterprise. An Uzbek LLC that imports foreign equipment is an importer, not a producer. The price preference, the additional points and the dedicated procurement page are three separate mechanisms.