Key Takeaways
- • Uzbekistan's Ministry of Investment, Industry and Trade (MIIT) is developing a draft law "On Alternative Investment Funds" in collaboration with the International Finance Corporation (IFC), targeting completion by March 2026.
- • The legislation establishes a modern legal framework for venture capital, private equity, and business angel investments, introducing standardized structures and instruments alongside "pass-through" taxation principles to align with international best practices.
- • An expanded working group meeting of the Foreign Investors Council convened in Tashkent on February 5, 2026, bringing together venture funds, business angels, international financial institutions, government officials, and parliamentary deputies to refine the draft law through stakeholder consultation.
- • Experts assess that adoption of the law will signal Uzbekistan's commitment to developing its alternative investment market and supporting innovative enterprises, potentially strengthening the country's appeal to global institutional investors.
- • The initiative supports Uzbekistan's broader investment strategy, which achieved $12 billion in FDI in 2024 and targets $1 billion specifically in venture and alternative investments to accelerate startup ecosystem development.
Summary
Uzbekistan is preparing comprehensive legislation to regulate its emerging alternative investment sector. The draft law "On Alternative Investment Funds" represents a strategic effort to establish legal clarity for venture capital, private equity, and business angel operations in the country. Development of the legislation is being led by the Ministry of Investment, Industry and Trade in partnership with the International Finance Corporation, with input from international experts and specialized firms. The timeline calls for completion by March 2026.
The legislation introduces several key elements designed to align Uzbekistan's regulatory framework with international standards. The draft law formally defines venture funds, private equity vehicles, and business angel structures—concepts previously absent from Uzbekistan's legal code. Critically, the law incorporates "pass-through" taxation principles, allowing investment vehicles to avoid double taxation and improving their competitive positioning relative to alternative jurisdictions. These features address structural barriers that have historically limited alternative investment activity in the region.
Stakeholder engagement has been central to the drafting process. An expanded meeting of the Foreign Investors Council's working group convened in Tashkent on February 5, 2026, bringing together representatives of venture funds, business angels, international financial institutions, multinational corporations serving as council members, deputies from the Legislative Chamber (Oliy Majlis), and senior officials from relevant government ministries. This consultation-based approach suggests the government is incorporating market participant feedback to ensure the law addresses practical operational challenges.
According to experts cited in government communications, adoption of the law will serve as an important signal to the global investment community regarding Uzbekistan's readiness to develop a sophisticated alternative investment market. This positioning occurs within a broader economic context: Uzbekistan recorded $12 billion in FDI during 2024 and is specifically targeting $1 billion in venture and alternative investments as part of its innovation support strategy. The legal framework is intended to facilitate that capital inflow while supporting the country's startup ecosystem development and its stated goal of achieving high middle-income status by 2030.
The legislation introduces several key elements designed to align Uzbekistan's regulatory framework with international standards. The draft law formally defines venture funds, private equity vehicles, and business angel structures—concepts previously absent from Uzbekistan's legal code. Critically, the law incorporates "pass-through" taxation principles, allowing investment vehicles to avoid double taxation and improving their competitive positioning relative to alternative jurisdictions. These features address structural barriers that have historically limited alternative investment activity in the region.
Stakeholder engagement has been central to the drafting process. An expanded meeting of the Foreign Investors Council's working group convened in Tashkent on February 5, 2026, bringing together representatives of venture funds, business angels, international financial institutions, multinational corporations serving as council members, deputies from the Legislative Chamber (Oliy Majlis), and senior officials from relevant government ministries. This consultation-based approach suggests the government is incorporating market participant feedback to ensure the law addresses practical operational challenges.
According to experts cited in government communications, adoption of the law will serve as an important signal to the global investment community regarding Uzbekistan's readiness to develop a sophisticated alternative investment market. This positioning occurs within a broader economic context: Uzbekistan recorded $12 billion in FDI during 2024 and is specifically targeting $1 billion in venture and alternative investments as part of its innovation support strategy. The legal framework is intended to facilitate that capital inflow while supporting the country's startup ecosystem development and its stated goal of achieving high middle-income status by 2030.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.