The Committee Serves to Promote Competition and Protect Consumer Rights

In this process, special attention is paid to ensuring the timely and effective implementation of administrative reforms, organizing the activities of the republic’s executive authorities based on updated requirements and principles.

The Presidential Decree “On measures to implement administrative reforms of the new Uzbekistan” from December 21, 2022, became the logical continuation of work in this direction. In accordance with the Decree, as part of the first phase of reforms, a proposal was adopted for the formation of a unified system of executive bodies of the republic from January 1, 2023.

According to the established principle, state bodies in the form of a committee were divided into two categories, i.e. those that coordinate and regulate the activities of the sector within the relevant field and organize the collegial management work in the system, and those that operate under the organizational subordination of the ministry and, in accordance with the legislation, have a special status and directly subordinate to the President of Uzbekistan and/or the Cabinet of Ministers.

The executive authorities, including senior officials, are being optimized up to 30 percent. The tasks of the republic’s executive authorities will also be regulated and reduced by at least 10 percent. Adjustments are being made to the activities of leaders based on citizens’ suggestions, their accountability to the public is being strengthened, as well as other innovations are being introduced.

According to this Decree, the Competition Promotion and Consumer Protection Committee was established on the basis of the Antimonopoly Committee, and the functions of the Consumer Rights Protection Agency under the Antimonopoly Committee were assigned to it.

In 2022, our Committee has developed 19 drafts of regulatory legal documents, among which three laws, four decrees of the President, nine draft decrees of the Cabinet of Ministers and three departmental documents of the Committee were prepared.

In particular, at present, the new draft law “On competition” prepared by the Committee with the support of international experts was approved by the Legislative Chamber of Oliy Majlis.

In order to assess the impact of draft legal documents on competition (ex-ante), 451 documents introduced by ministries and agencies were examined. 49 percent of them contain provisions restricting competition and conclusions were drawn to exclude them.

The Committee and its territorial bodies reviewed the existing legal and other documents (ex-post) adopted by the local state authorities and state administration bodies in order to assess their impact on competition. During the process, it was determined that 521 decisions and documents restricting competition were adopted by 76 local state authorities and 9 regional divisions of state administration bodies, and measures were taken to repeal them.

According to the current legislation, aimed at obtaining an advantage by a business entity or a group of persons in the implementation of economic activity that are contrary to the legislation, business practices, and possible actions that cause or may cause damage to other business entities (competitors) or damage or harm their business reputation are considered to be unfair competition.

In 633 cases of unfair competition, the Committee and its territorial bodies identified and gave instructions to eliminate violations of this Law.

In order to maintain and strengthen the market position in a competitive environment, an entrepreneur has to constantly work on himself - to search for ways to reduce the cost of goods, to introduce innovative solutions and marketing, to engage in advertising. Therefore, in practice, some entrepreneurs prefer to work “in collusion” with each other rather than competition. Agreements by competitors to set, raise and coordinate prices by mutual consent are known as “cartel agreement” (collusion). Such interactions allow them to move superiorly in a “stealthy” manner. At the same time, in practice, since such cartel agreements are carried out in secret, their detection remains a very difficult task.

The Committee analyzed 262 commodity and service markets in order to assess the competitive environment in our country in the commodity, financial and digital markets, and to determine the level of saturation of local products. Here, particular attention was paid to cement, mineral fertilizers, electric meters, porcelain products, the insurance markets, security, integration of fiscal information of business entities with the tax system, services of online taxi aggregators, in-depth study of monopolized related markets of natural monopoly entities.

The analysis revealed that 15 commodity and financial markets have been removed from a monopoly position thanks to the formation of sufficient competition, on the contrary, 7 of these markets have enterprises with a dominant position. In general, there are currently 85 companies and groups of persons occupying a dominant position in 97 commodity and financial markets, where competition is weak.

In recent years, the number of natural monopoly entities has decreased from 151 to 129. In 2022, 134 business entities included in the state register of large state monopolies and natural monopoly entities were monitored for 11 types of services. 70 percent of these entities are state-owned enterprises, and the rest was contributed by the private sector.

By increasing the effectiveness and accountability of the tasks assigned to the Competition Promotion and Consumer Protection Committee, it will contribute to the reforms aimed at building a new Uzbekistan, economic growth, ensuring a healthy competitive environment and free access of entrepreneurs to the markets, and protecting the citizens’ interests and further improving the well-being of the population. In this case, the establishment of a compact and integrated state management system will become a leading force in ensuring the effectiveness of our activities.

Farrukh Karaboev,

The Deputy Chairman of the Competition Promotion and

Consumer Protection Committee