Senate of Uzbekistan Strengthens Oversight of Gold and Precious Metals Circulation

Tashkent, Uzbekistan (UzDaily.com) — During its eleventh plenary session, the Senate of the Oliy Majlis approved the law “On Amendments and Additions to Certain Legislative Acts of the Republic of Uzbekistan, Aimed at Improving Regulations Related to the Circulation of Currency, Precious Metals, and Precious Stones.”

The adoption of this legislation was prompted by legal gaps in the regulation of precious metals and stones identified in recent years. Following the 2019 revision of the Law “On Currency Regulation,” these valuables were excluded from the category of currency, which created uncertainty in judicial and investigative practice when handling cases involving their illegal circulation.

The lack of clear legal norms contributed to the growth of the shadow market. Over the past five years, more than a hundred cases of illegal circulation of precious metals and stones have been detected, with confiscations of gold, silver, diamonds, and emeralds totaling around 50 billion soums. Experts estimate that gold items valued between 550 and 600 million U.S. dollars are circulating on the black market.

At the same time, the volume of gold delivered by independent prospectors in 2023 fell a hundredfold compared to 2020 — from 40 kilograms to less than 0.5 kilograms.

The inconsistency of existing legislation also negatively affected the operations of around two thousand entrepreneurs legally working in this sector and benefiting from tax incentives.

The newly adopted law addresses these gaps. Amendments have been made to the Criminal Code and the Code of Administrative Responsibility, introducing specific penalties for the illegal acquisition, possession, or transfer of precious metals and stones. In particular, Article 177 of the Criminal Code and Article 170 of the Administrative Code have been supplemented with new clauses aimed at strengthening law enforcement practices.

Additionally, key definitions have been clarified and updated. The legislation now formally defines the terms “precious metals” and “precious stones,” aligning them with the current version of the Law “On Currency Regulation.” Article provisions on penalties for evading mandatory sales of part of foreign exchange revenue have been removed from the Administrative Code, reflecting the country’s policy of further liberalization of currency regulation.

Senators emphasized that the law will eliminate legal contradictions, enhance the transparency of the circulation of precious metals and stones, ensure consistent application of the law, and increase the certainty of liability for violations in this area.