A significant legal framework for the introduction of Islamic banking has been established in Uzbekistan. On March 27, 2026, the President signed the Law (O‘RQ-1126) aimed at introducing Islamic banking activities into the country’s financial system.
The document was developed by the Central Bank in collaboration with local and foreign experts, taking into account international standards and leading global practices.
The Law introduces amendments and additions to the Tax and Civil Codes, as well as seven other laws. Specifically, the following key elements are now integrated into the national legislation:
- New definitions: Official concepts for Islamic banking activity, Islamic financial operations, Islamic financial standards, and investment deposits have been introduced.
- Licensing: A specific license for Islamic banking has been created. The Law sets clear requirements for obtaining this license, which is issued without an expiration date and cannot be transferred to other parties.
- Direct trade and investment: Banks with an Islamic banking license are now permitted to engage in direct trading activities. They are also authorized to establish legal entities and acquire shares or stakes in their authorized funds without restrictions.
- Governance and coordination: To coordinate Islamic financial activities, Islamic Finance Councils will be established at both the Central Bank and within commercial banks.
Types of Islamic financial operations
Based on the Law, banks with the appropriate license can conduct the following types of Islamic financial operations:
- Financing and investment deposits: Attracting funds or financing clients based on profit-sharing conditions (mudaraba).
- Agency agreements: Providing or attracting funds through agency contracts (wakala).
- Installment sales: Financing through the sale of goods in installments (murabaha).
- Prepayment for goods: Financing via advance payment for goods (salam).
- Partnerships: Financing through joint activities or participation in the charter capital of legal entities (musharaka).
- Islamic leasing: Providing property for lease with the right to subsequent buyout (ijara).
The Law also defines specific tax regulations for Islamic financial operations. This new framework is viewed as an alternative mechanism for attracting funds from the shadow sector into the formal banking system.
Strategic goals for the 2026–2030 period include:
- Creating at least two fully Islamic banks and opening “Islamic windows” in state-owned banks.
- Attracting approximately $1 billion in additional investments and deposits.
The Law will officially come into force three months after its publication, starting from June 28, 2026.
