Uzbekistan targets illegal foreign crypto platforms with new fines
The National Agency of Perspective Projects has established a new regulatory framework to penalise foreign companies providing unauthorised crypto-asset services to residents.
Based on presidential decrees from July 2017 and July 2018 aimed at developing the national digital economy, the directive authorises the NAPP to levy substantial financial penalties against offshore entities bypassing local licensing laws. Paying these penalties does not absolve companies from further legal liability under Uzbek law.
Penalties are calculated using the national basic calculating amount, which is currently set at 412,000 soums ($34.5). Operating without a legitimate licence carries the heaviest financial burden. Other major offences include violating anti-money laundering protocols and mishandling personal data.
| Offence | Penalty in BRV | Penalty in UZS (USD) |
| Operating a crypto-asset business without a proper licence | 25,000 | 10.3bn soums ($862,502) |
| Personal data storage and usage violations | 15,000 | 6.18bn soums ($517,501) |
| Anti-money laundering and terrorism financing breaches | 15,000 | 6.18bn soums ($517,501) |
| Crypto-asset advertising violations | 10,000 | 4.12bn soums ($345,001) |
Enforcement and penalty assessment
The NAPP relies on multiple intelligence sources to identify regulatory violations. These include law enforcement audits, mandatory regulatory filings, independent audit reports, public complaints and data from compliant crypto-asset service providers.
When determining enforcement actions, regulators evaluate the systemic nature and duration of the offence. The agency also considers the impact on market participants, the root causes of the violation, the effectiveness of any previously applied fines and voluntary corrective measures taken by the offending company to mitigate harm.
A dedicated working commission oversees the investigation process. Comprising an odd number of NAPP officials, this body reviews evidence and issues regulatory conclusions. The agency director or an acting deputy must then formally approve the penalty based on the commission’s findings.
Regulators are required to impose fines within six months of discovering an offence and no later than three years after the violation occurred. The commission must notify accused foreign entities five working days before any hearing, granting corporate representatives the right to attend.
Payment procedures and appeals
Once the agency issues a penalty decision, companies receive a formal notice detailing the exact fine, payment deadlines and bank routing information. Firms have 15 days from the notification date to settle their balances. Half of the collected funds are directed to the state budget while the remaining 50% goes into the NAPP’s treasury accounts.
If an entity fails to pay within the designated timeframe, the NAPP will escalate the matter to court for forced collection. The agency also retains the right to publicly disclose the identities of penalised firms in the media.
Foreign companies retain the right to contest regulatory decisions. An appeal must be submitted in writing to the NAPP’s Appeal Council or a local court within 15 days of receiving the penalty notice. Lodging a formal complaint automatically suspends the payment deadline until the dispute is resolved.
The Appeal Council is required to review disputes within 15 days of submission, notifying the appellant five working days before the hearing. The council will either uphold the original agency decision if the claims lack evidence or overturn the penalty if the company validates its defence.
