Features of the development of modern science in the pandemic’s era: collection of scientific papers «scientia» with Proceedings of the I international Scientific and Theoretical Conference (Vol. 1)

 
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SECTION 5. 
MANAGEMENT, PUBLIC MANAGEMENT AND ADMINISTRATION 
Shokhijakhon Fayzulloev Jobirovich 
Teacher
Tashkent State University of law, Republic of Uzbekistan 
INTERNATIONAL PRACTICE OF THE REGULATION 
OF FOREIGN INVESTMENTS – A COMPARATIVE 
STUDY OF UZBEKISTAN AND SOME DEVELOPED 
COUNTRIES LEGISLATION ON INVESTMENT 
 
Abstract. 
This article will analyze, evaluate and explore the legislations of the Republics of Uzbekistan and 
some developed countries on investment, and it would be comparative review of different jurisdictions on 
investment. 
Foreign investment is one of the main factors contributing to the accelerated economic 
development of the country. Even such highly developed countries as the United States, Germany, 
France, Japan, Great Britain consider the constant attraction of foreign capital as a necessary 
means of increasing their economic potential and improving the well-being of citizens. The 
activating influence of foreign investment is also clearly demonstrated by the experience of 
countries like China, South Korea, Singapore, Malaysia and other East Asian countries which are 
in a state of rapid economic development. One of the most important things on attracting foreign 
investors is creating an appropriate legal framework, investors first and foremost consider a 
country’s legislation on investment before investing to any country. 
The legal literature focuses on the definition of "foreign investment" rather than 
"investment" in general. This is due to the fact that it is necessary to clearly distinguish those 
private foreign investments that are subject to guarantees and benefits provided under the country's 
investment legislation from other income from abroad that is not subject to this. According to
N. N. Voznesenskaya, such a distinction is in the interests of the recipient state, which is not 
interested in any capital, not in any funds coming from abroad. [1] Foreign investments are 
considered as any property owned by foreign investors, including any rights and interests related 
to this property. According to A. G. Bogatyrev, foreign investment, first of all, is foreign property 
in its various manifestations, it is private property associated with the right to own, dispose of and 
use this capital on the territory of another state. [2] As correctly noted in the foreign legal literature 
by G. Schwarzenberger, it is desirable to distinguish more clearly between foreign property and 
investment and consider property as a broader term that includes investments, but is not limited 
to them.[3] 
At the present stage of development of the world economy, the implementation of foreign 
investments is becoming increasingly important, becoming one of the most important elements of 
investment activity in the economy of various countries. The total volume of foreign investment 
in the world is growing annually at a much higher rate than the total gross product of the world's 
countries. In accordance with the legislation of the Republic of Uzbekistan, investments — 

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tangible and intangible assets and rights to them, including intellectual property rights, as well as 
reinvestments, invested by an investor on the basis of risks in social facilities, entrepreneurial, 
scientific and other activities for profit, which may include: 
funds, including cash (including foreign currency), targeted bank deposits, shares, stocks, 
bonds, bills and other securities; 
movable and immovable property (buildings, structures, equipment, machinery and other 
material values); 
intellectual property rights, including patented or non-patented (know-how) technical, 
technological, commercial and other knowledge, drawn up in the form of technical documentation, 
skills and production experience, necessary for organizing a particular type of production, as well 
as other values, not prohibited by the legislation of the Republic of Uzbekistan. [4] 
In the scientific literature foreign investment is defined as the investment of foreign capital 
in an object of business activity on the territory of a country in the form of objects of civil rights 
belonging to a foreign investor, including money, securities, other property, property rights that 
have a monetary value of exclusive rights to the results of intellectual activity, as well as services 
and information. [5] 
On December 25, 2019, the President of the Republic of Uzbekistan signed the Law "On 
Investments and Investment Activities". The adoption of the Law is provided for by the Decree of 
the President of the Republic of Uzbekistan "On measures to improve the investment climate in 
the Republic of Uzbekistan" dated 01.08.2018. The Law serves as a single document combining 
the main provisions of the laws "On Foreign Investment", "On Investment Activity" and "On 
guarantees and measures to protect the rights of foreign investors", which lose their force after the 
entry into force of the Law. 
The Law provides that legal relations in the following areas are regulated by separate laws: 
–
concession activities; 
–
conclusion, execution and termination of production sharing agreements; 
–
investment, mutual and venture funds; 
–
capital market regulation; 
–
securities transactions, public-private partnerships, special economic zones. 
The law classifies investments into three categories: 
Capital investments - investments invested in the creation and reproduction of fixed assets, 
including new construction, modernization, reconstruction, technical re-equipment, as well as in 
the development of other forms of material production; 
Financial investments - investments invested in stocks, corporate, infrastructure and 
government bonds, as well as in other types of securities; 
Social investments are investments invested in the development of human potential, skills 
and industrial experience, as well as in the development of other forms of intangible benefits. 
The amount of benefits and guarantees depends on the volume of investments, location, 
sector of the investment project, the expected socio-economic impact and the creation of new jobs. 
In particular, the Law explicitly prohibits exclusive benefits and guarantees that may lead to a 
dominant position of the investor in the relevant market. 
In addition, it should be noted that previous laws did not distinguish between the concepts 
of foreign and domestic investors, while this Law clearly defines both concepts. In accordance 
with the Law, the concept of a domestic investor includes citizens of the Republic of Uzbekistan, 
foreign citizens and stateless persons with the status of a resident of the Republic of Uzbekistan, 
including individual entrepreneurs, as well as legal entities of the Republic of Uzbekistan engaged 
in investment activities. 
It should be noted that the Law establishes additional requirements for the content of 
investment agreements. In particular, it requires investment agreements to include anti-corruption 
and antitrust provisions. In addition, if funds are invested in priority sectors of the economy, 

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additional benefits may be provided to investors in each specific case. [6] The general procedure 
and detailed information on investment agreements are contained in the Resolution of the Cabinet 
of Ministers No. 180 of 02.08.2005. 
It is important to note that the Law provides for new mechanisms to support investors, such 
as: 
An investment tax credit that allows investors to deduct a certain percentage of specific taxes 
related to investments from their tax liabilities for a certain period. After the specified period, the 
investor gradually pays the "loan amount" and accrued interest; 
Investment subsidies, under which the government can finance the construction of external 
engineering and communication networks necessary for the implementation of an investment 
project. In addition, investment subsidies can be provided in the form of tax and customs benefits. 
Another novelty enshrined in the Law is the so-called "single window", which allows 
investors to reduce their communication with several government agencies. In accordance with 
this Law, the functions of a single window for investors are assigned to the Ministry of Investment 
and Foreign Trade and its territorial bodies. The Ministry of Investment and Foreign Trade, in 
particular, will provide consulting services and assistance in the preparation and submission of 
documents. Moreover, the Law details the functions of the Business Ombudsman, who is 
accountable to the President of the Republic of Uzbekistan. One of the main functions of the 
Business Ombudsman is to coordinate inspections of the activities of business entities and monitor 
the legality of their conduct by regulatory authorities. [7] 
Last but not least, the Law introduces a new multi-level mechanism for resolving investment 
disputes between investors and the state. The first level requires both sides to make efforts to 
resolve the dispute through negotiations. If the parties are unable to resolve the dispute through 
negotiations, mediation is the next step. The Law does not provide for a detailed procedure for the 
settlement of investment disputes, nor a reference to Law "On Mediation". It should be noted that 
the Law ”On Mediation" clearly provides that mediation is applied with the mutual voluntary 
expression of the will of the parties expressed in the agreement on the use of mediation. [8] 
Therefore, it is unclear to what extent mediation is mandatory for investment disputes and whether 
the non-use of mediation by the parties will prevent recourse to the following dispute resolution 
mechanism. The third level of the dispute resolution mechanism requires the parties to refer the 
dispute to the national courts of the Republic of Uzbekistan. If the parties do not resolve the dispute 
in the courts, the dispute may be submitted to arbitration. 
Analysis of sources of investment law in foreign countries, including sources of legal 
regulation of investment activities involving foreign investment, allows us to say that in general, 
legal regulation is reduced to either codified regulation or regulation through special 
legislation.[11-14] Thus, at various times, investment codes have been adopted in the Republic of 
Belarus, the people's Democratic Republic of Algeria, and a number of other countries. At the 
same time, special legislation on foreign investment is mostly in force in the post-Soviet space, 
for example, special laws have been adopted in Armenia, Uzbekistan, Turkmenistan, Ukraine, etc. 
However, for a number of countries in order to establish a legal regime for foreign investment, it 
is typical to use non-special (and certainly not codified) legislation. Legal regulation is carried out 
by applying the General rules of currency, tax, banking law, etc. This method of legal regulation 
applies, in particular, in the United States, Great Britain, France, Japan, Switzerland, Spain and a 
number of other countries. 
In 2007, the Indonesian investment law was adopted. The investment law, in particular, 
concerns the establishment of new investments, investment incentives and investor rights. This 
law defines the definition of investment, domestic investment, foreign investment, investor, 
domestic investor, foreign investor. According to the Indonesian investment law Central 
Government, hereinafter called Government, shall be any the President of the Republic of 
Indonesia holding the governmental power of the state of the Republic of Indonesia pursuant to 

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the 1945 Constitution of the Republic of Indonesia.[9] Furthermore, Indonesian Investment Law 
states principles and objectives of investment, basic policy investment, the rights, obligation, and 
liability of investors. 
When it comes to Singapore, one of specific features of Singapore’s legislation on 
investment is the absence of an investment law [9-15]. There is neither any specific law in 
Singapore on foreign investment nor an economy-wide investment law which could govern 
domestic or foreign investment. Laws of general application that is, the common law of contract, 
sector-specific legislation and Singapore Companies Act govern investment in Singapore. 
Investment Agency Singapore’s Economic Development Board (EDB) was established by statute 
in 1961. The Economic Development Board Act sets out the functions and the powers of the EDB. 
Notably, Section 6 of the EDB Act makes it clear that its function is to attract and facilitate both 
local and foreign investment. On its website, the EDB currently describes itself as a Singapore’s 
Economic Development Board (EDB) acts as an investment agency. In 1961, Singapore’s 
Economic Development Board was established according to the statute. Functions and powers of 
the EDB of Singapore are set out by The Economic Development Board Act. Notably, according 
to the Section 6 of the EDB Act makes it clear that its function is to attract and facilitate both local 
and foreign investment.[9]