Uzbekistan drafts Islamic finance regulations

TASHKENT, Oct 12 (Reuters) – Uzbekistan has drafted regulations on Islamic bonds, or sukuk, and aims to register the first issues next year, the Central Asian nation’s Capital Market Development Agency said on Monday.

The most populous nation in the predominantly Muslim part of the Soviet Union, Uzbekistan has for the last few years sought to attract fresh foreign investment in order to jumpstart its economy which had stagnated under the previous government.

The draft regulations published for public discussion cover various types of sukuk and their legal and tax treatment.

Under a pilot project, Uzbekistan plans to allow local companies to issue sukuk both domestically and abroad using elements of English law and enjoying some tax breaks.

The nation of 34 million people issued its first sovereign Eurobond last year which has been followed by bonds from several state-owned companies, the most recent one announced on Monday by the National Bank for Foreign Economic Affairs (NBU), Uzbekistan’s largest bank by assets. (Reporting by Mukhammadsharif Mamatkulov, Writing by Olzhas Auyezov and Ed Osmond)

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