In order to commercially develop mineral deposits with wide-scale attraction of foreign investments, to stimulate geological exploration using modern methods and technologies, as well as to further improve the taxation procedure for subsoil users:

1. Resolve that effective January 1, 2022 a special procedure shall be established for tendering the right to use a subsoil area for geological exploration or mining on a previously explored subsoil area of hydrocarbons, precious, non-ferrous, rare, and radioactive metals, and other types of ore mineral objects with significant commercial potential. Hereby:

the sale amount shall be considered as the amount of bonus for the right to use the subsoil and shall be transferred to the republican budget of the Republic of Uzbekistan excluding the expenses of the organizers of the competitive bidding;

organizers or bidders shall have the right to offer increased tax rates for certain types of taxes in the extraction (mining) of minerals in accordance with the procedure established by the legislation.

2. Agree with the proposal of the Ministry of Finance, the Ministry of Economic Development and Poverty Reduction and the State Committee on Geology and Mineral Resources to abolish effective January 1, 2022 the commercial discovery bonus charged for the right to extract minerals, as well as the signature bonus charged for the right to conduct mineral search and exploration activities.

3. Establish that effective January 1, 2022:

a) land plots allocated for geological exploration and (or) survey works shall not be subject to land tax from legal entities;

b) the annual license fee for the use of subsoil for geological exploration, calculated on the basis of the allotted area and types of minerals, in the amounts established by the legislative acts, shall be introduced;

c) the annual license fee for the use of subsoil for geological exploration shall be transferred:

70 percent - to the republican budget of the Republic of Uzbekistan;

15 percent - to local budgets of the regions;

15 percent - to local budgets of districts (cities).

4. Exempt legal entities carrying out exploration work, as well as contractors and subcontractors engaged by them from:

periodic customs payments for temporary import of special equipment necessary for geological exploration for the period of prospecting, exploration and development of deposits;

customs duty on import of equipment, material and technical resources, and special equipment not produced in the Republic of Uzbekistan, necessary for work on prospecting, exploration and development of deposits according to the lists formed in accordance with the established procedure.

Extend the benefits stipulated in the third paragraph of clause 4 of the Decree of the President of the Republic of Uzbekistan dated April 28, 2000 No. UP-2598 "On measures to attract foreign direct investment in oil and gas exploration and production" to the domestic enterprises engaged in search and exploration of hydrocarbon deposits in the Republic of Uzbekistan/

Resolve that the refund of the amount of value added tax to legal entities engaged in geological exploration shall be made in accordance with the procedure established by the Tax Code of the Republic of Uzbekistan, but no later than 30 days from the date of application.

5. Resolve that effective October 1, 2021:

the excise tax rate shall be set at zero percent for natural gas export sales;

legal entities shall be exempt from customs duty when importing natural gas into the territory of the Republic of Uzbekistan.

6. The State Committee on Geology and Mineral Resources, the Agency for Management of State Assets, the Ministry of Economic Development and Poverty Reduction, the Ministry of Finance, the State Tax Committee shall — within three months — bring in line with this Decree the procedure for issuing permits for the right to use subsoil area, taking into account the competitive bidding and determination of the initial value of the tendered subsoil area use right, with the provision of competitive bidding organizers or participants with the right to offer increased tax rates for certain types of taxes.

7. The Ministry of Finance jointly with the State Tax Committee, the State Committee on Geology and Mineral Resources and other ministries and agencies concerned, by December 1, 2021, shall submit to the Cabinet of Ministers the draft Law “On Amendments and Additions to the Tax Code of the Republic of Uzbekistan”, providing effective January1, 2022:

reduction of tax rates for the use of subsoil for oil and natural gas to 10 percent; gold and copper — to 7 percent; tungsten — to 2.7 percent; and uranium — to 8 percent. At the same time, for enterprises with a state share that produce hydrocarbons, precious, non-ferrous, rare, and radioactive metals, as well as under production sharing agreements (unless a different procedure is provided for by agreements and contracts that entered into force before September 1, 2021), the President of the Republic Uzbekistan may establish increased tax rates for the use of subsoil;

introduction of an unearned income tax for subsoil users producing (extracting) oil, natural gas, gas condensate, precious, non-ferrous, rare and radioactive metals at new fields, taking into account the capital expenses of subsoil users;

exemption from corporate property tax for new oil and gas wells in the first two years, starting from the month of their commissioning; while during the following three years — the application of the corporate property tax rate reduced by 50 percent of the established tax rate;

further improvement of the procedure for calculating the subsoil use tax, taking into account the best foreign practices, as well as engaging the experts. At the same time, resolve that when calculating the tax for the use of mineral resources for the extraction of oil, natural gas, and certain types of minerals in the period from January 1, 2021 to December 31, 2021 the tax base shall be reduced by the amount of costs associated with their transportation and processing;

harmonization of tax rates for subsoil use for non-metallic mineral resourcess;

granting the right to keep tax records in U.S. dollars to enterprises with foreign investment — taxpayers of unearned income tax.

8. The State Committee on Geology and Mineral Resources, the Ministry of Finance, and the State Tax Committee shall provide the procedure arising from this Decree in the new version of the draft Law of the Republic of Uzbekistan "On Subsoil".

9. The Ministry of Finance, the Ministry of Economic Development and Poverty Reduction, and the State Committee on Geology and Mineral Resources shall submit proposals — within three months — jointly with the concerned ministries and agencies to the Cabinet of Ministers on amendments and additions to the legislation acts, arising from this Decree.

10. Control over the execution of this Decree shall be assigned to the Prime Minister of the Republic of Uzbekistan A.N. Aripov.