New decree in Uzbekistan introduces “single housing life cycle” for construction projects

A new principle known as the "single housing life cycle" will be introduced in Uzbekistan to regulate the construction of residential and non-residential facilities, particularly those developed on a share basis. This initiative is part of the Presidential Decree “On measures for the further development of the housing construction sector and improving the mechanisms for regulating the process of constructing residential and non-residential facilities on a share basis,” adopted on January 27, 2025.

The "single housing life cycle" principle will focus on the following key objectives:

- Protecting the rights of individuals and legal entities involved in the construction of residential and non-residential facilities.
- Organizing housing construction with efficient use of available land resources.
- Reducing the timeline for executing investment projects in the housing construction sector.
- Creating reliable opportunities for purchasing housing on a share basis and through mortgage loans.
- Promoting the use of energy-efficient building materials in housing construction.

As per the decree, from July 1, 2025, several new measures will be implemented, including:

- Construction and contracting organizations, developers, and customers will be required to attract shareholders' funds through notarized and state-registered contracts for participation in construction.
- Shareholders’ funds will be deposited in “escrow” accounts opened with authorized commercial banks under agreements between the builder, shareholder, and the bank.
- Funds in these escrow accounts cannot be used to settle obligations with third parties or the builder.
- Once the builder has completed at least 30 percent of the construction work at their own expense, commercial banks will establish a system of targeted credit allocation to assist the builder.

Additionally, from July 1 to December 31, 2025, shareholders will be able to invest through either escrow accounts or the current direct attraction mechanism for equity participation, at the discretion of the parties involved. Starting January 1, 2026, all funds will be required to be placed through escrow accounts.

An electronic platform for housing construction will be created within the "Transparent Construction" information system, which will be fully operational by July 1, 2025. By this date, a state registration system for equity contracts will be introduced, allowing electronic submission to tax authorities and enabling the transfer of claims and pledge rights under equity contracts.

To ensure successful implementation, a project office will be established under the Ministry of Economy and Finance to oversee the rollout of the "Single Housing Life Cycle" principle.