RESOLUTION OF THE CABINET OF MINISTERS OF THE REPUBLIC OF UZBEKISTAN

of February 1, 2012 No. 25

About entering of amendments into Rules of retail trade in the Republic of Uzbekistan

For the purpose of ensuring legal regulation of retail trade by legal entities and physical persons in the territory of the Republic of Uzbekistan with use of multi-level system of marketing ("network marketing") the Cabinet of Ministers decides:

1. Make changes and additions to the Rules of retail trade in the Republic of Uzbekistan approved by the resolution of the Cabinet of Ministers of February 13, 2003 N 75 (the joint venture of the Republic of Uzbekistan, 2003, N 2, the Art. 15), according to appendix.

2. To the State Customs Committee of the Republic of Uzbekistan together with territorial authorities of the State Tax Committee, the Ministry of Internal Affairs, Department on fight against tax, currency offenses and legalization of the criminal income under the Prosecutor General's Office of the Republic of Uzbekistan and executive bodies on places to strengthen work on identification and non-admission of illegal delivery of goods to the territory of the republic, transportation and their realization in the form of "network marketing".

3. To the State Tax Committee together with the Prosecutor General's Office of the Republic of Uzbekistan, the State committee of the Republic of Uzbekistan on demonopolization and development of the competition, Federation of societies of consumer protection, and also with the interested ministries and departments to approve package of measures for broad promotion among the population, first of all youth, negative effects connected with illegal implementation of activities in the form of "network marketing", the purpose and (or) of which creation of "financial pyramids", low-quality sales of goods and eventually, illegal enrichment at the expense of the population is result in a month.

4. To the ministries and departments to bring departmental regulatory legal acts into accord with this resolution in a month.

5. To impose control of execution of this resolution on the First Deputy Prime Minister of the Republic of Uzbekistan R. S. Azimov.

Appendix

to the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan of February 1, 2012 No. 25

The additions made to the Rules of retail trade in the Republic of Uzbekistan approved by the resolution of the Cabinet of Ministers of February 13, 2003 No. 75

1. Add Item 3 with paragraphs of the following content:

"network marketing - kind of the retail sale of goods based on creation by the network organization of network of the sales agents extending goods independently;

the network organization - the legal entity of the Republic of Uzbekistan performing trade in the territory of the Republic of Uzbekistan independently or through sales agents by network marketing;

the sales agent - physical person - the individual entrepreneur without formation of legal entity who is directly realizing goods through stationary outlets, and also working with potential buyers by means of adoption of orders at home in organizations, the organizations, the companies, transport or on the street which income depends only on sales volume".

2. Add with the Section XVII-1 of the following content:

"XVII-1. Features of implementation of retail trade by network marketing

187-1. The realization of goods by the network organization to sales agents is enabled for clearing settlement based on the agreement (kupliprodazha, the commission, the order, etc.) signed between them. At the same time the network organization shall have the license for implementation of wholesale trade.

Retail trade by network marketing is performed by sales agents in stationary outlets.

187-2. Out of stationary outlets sales agents work with potential buyers by means of adoption of orders at home, in organizations, the organizations, the companies, transport or on the street. At the same time sales agents shall not impose goods to the consumers who did not express interest in their purchase and also shall stop to offer goods according to their first requirement.

187-3. Orders are taken by sales agents on purchase of this or that type of goods from buyers in case of direct communication.

Order placement is made on forms in duplicate where are specified:

sequence number of the order;

surname, name, middle name of the sales agent;

number and date of the agreement signed between the sales agent and the network organization;

the name, the price, quantity and total cost of implementable goods, and also, in the presence, the cost of in addition provided services;

payment method of acquired goods;

date of acceptance and execution of the order;

surname (name, middle name) and signature of the buyer.

The first copy of the form of the order is transferred to the buyer, the second remains at the sales agent.

187-4. The sales agent shall open in detail to the potential buyer in case of goods offering of the information about their producers, countries of source, quality characteristics, availability of any restrictions and possible additional fares.

187-5. Realization through sales agents by network marketing of bioactive additives (dietary supplements), medicines and products of medical appointment is forbidden.

Import and realization of import goods by means of network marketing are not allowed:

through the physical persons who are not the subject of business activity;

through representative offices of the foreign commercial organizations.

187-6. Acceptance of payments from consumers by sales agents is performed only in stationary outlets with use of cash registers with fiscal memory and payment terminals.

All cash cash receipts received from sales of goods by the network organizations and (or) their sales agents shall be collected (are handed over) in banks in the procedure established by the legislation.

187-7. The network organization in the activities shall: enable the realization of goods purchased to sales agents

only for clearing settlement in the procedure established by the legislation;

involve sales agents to implementation of network marketing based on the agreements signed with them;

in terms and procedure, established by the legislation to represent the tax and financial reporting; provide to sales agents of the certificate, testimonial of the right

realization by them of goods of the network organization, copy of necessary certificates and delivery notes on implementable goods;

accept unconditionally back from sales agents unrealized goods with compensation of the money which is earlier accepted in their payment.

It is forbidden to attract as sales agents of persons, 18 years, and pupils of averages of special, professional educational institutions are younger.

187-8. When implementing network marketing it is not allowed: establishment of the minimum quantity of goods which the sales agent for the conclusion of the agreement shall acquire;

collection of payment in the form of the membership fee;

establishment of the requirement about attraction by the sales agent after the conclusion of the agreement of other sales agents.

187-9. The taxation of the sales agent is performed according to the procedure, established by the Tax code of the Republic of Uzbekistan for individual entrepreneurs".

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