President signed the Measures to Totally Improve the Investment Climate in Uzbekistan Decree according to which, Uzbekistan has enacted a procedure according to which starting from August 1 investors will be compensated the losses incurred, relying on a decision of a state body, which was afterwards recognized as invalid or void.

"An investor or a business entity acting in good faith shall be compensated for property damage that arose due to the trust in the legal force of an administrative act of an official body adopted in relation to them, relying on the legal force of which, he used the property, made a deal or otherwise used the benefits and advantages provided, in case of subsequent recognition of this act as invalid or its cancellation," the decree said.

The question of voiding or amending an administrative act of a public authority, in cases where it affects the legitimate interests of a bona fide investor and a business entity shall be judicially examined, unless its maintaining creates a threat to the public interest.

"This means that the state assumes the responcsibility for the administrative acts adopted by its bodies," explained the chief consultant of the Ministry of Justice Javohir Kolizoda in Akhborot 24 news program on Uzbekistan 24. - For example, before when a district mayor made a decision to allocate a land plot to an investor, and the investor, relying on the forces of this act, commences construction works. However, after a while it turns out that this mayor’s decision was illegal, and the higher authority (mayor) cancels the decision. In this case, the investor incurred only in losses "

Now, according to the expert of the Ministry of Justice, in such cases, the investor or business entity shall eb compensated for property damage that arose because of the trust in the legal force of an administrative act.

Losses caused to both natural and legal persons as a result of the issuance of an illegal administrative act of a state body or official shall be reimbursed by the state, primarily through extrabudgetary funds of the relevant bodies with subsequent recovery from the guilty party in recourse.

Such measures, according to Akhborot 24, will put more responsibility on local executives for the decisions they make.