Reorganization of a LLC in Uzbekistan

Publication date: 12.07.2025

The reorganization of a Limited Liability Company (hereinafter — LLC) is one of the key forms of business transformation in a market economy. It aims to optimize management, concentrate resources, diversify activities, and enhance competitiveness. The Law of the Republic of Uzbekistan “On Limited Liability Companies” regulates the legal grounds, forms, and procedures of reorganization, ensuring a balance of interests among shareholders, creditors, and the state.

1. Concept and Legal Nature of Reorganization

Reorganization is the process of changing the structure and legal status of a legal entity while maintaining succession. Unlike liquidation, it does not terminate the business but merely transforms it.

The legal nature of reorganization is expressed in the following:

Continuity of civil turnover (preservation of obligations and legal relations);
Universal succession (all rights and obligations are transferred to the new entity or entities);
Corporate will of participants (the decision is made by the general meeting of participants).

2. Forms of Company Reorganization

The legislation of Uzbekistan distinguishes five main forms of LLC reorganization:

Form	Essence	Legal Consequences
Merger	Combination of two or more companies into a new one	Termination of all merged companies; transfer of rights and obligations to the newly created company
Accession	Termination of one or more companies with transfer of their rights and obligations to another company	Termination of the acceding companies; preservation of the successor
Division	Termination of one company and creation of two or more new ones	Distribution of rights and obligations among the newly created companies
Separation	Creation of one or more companies from the existing one	Preservation of the original company; transfer of part of its rights and obligations to the new entities
Transformation	Change of organizational and legal form (e.g., LLC → JSC)	Preservation of the legal entity in a new form with universal succession

3. Procedure for Reorganization

Adoption of the Decision
- The decision is made by the general meeting of participants unless otherwise provided by law.
- Certain forms (e.g., transformation) require unanimity.
Notification of the Registration Authority and Creditors
- The company must notify creditors in writing.
- Creditors are entitled to demand early performance of obligations or compensation for losses.
Preparation of Constituent Documents and Balances
- A transfer deed (for merger, accession, or transformation) or a separation balance sheet (for division or separation) is prepared.
- These documents must reflect all rights and obligations of the company.
State Registration
- Reorganization takes effect upon entry in the State Register of Legal Entities.
- From that moment, the newly created companies acquire legal status.

4. Guarantees of Rights of Creditors and Participants

Creditors may demand early fulfillment of obligations.
Company participants are entitled to receive shares in the new companies proportionally to their ownership.
Violation of the notification procedure or incomplete reflection of obligations in the transfer deed may result in the reorganization being declared invalid by a court.

5. Comparative Characteristics of Reorganization Forms

Criterion	Merger	Accession	Division	Separation	Transformation
Number of companies before	2 or more	2 or more	1	1	1
Number of companies after	1 new	1 (successor)	2 or more new	1 + new	1 (in a new form)
Succession	Full, to the new company	Full, to the continuing company	Partial, distributed	Partial	Full
Constituent documents	New charter	Amendments to the successor’s charter	New charters	New charters + amendments to the old one	New charter
Termination of previous companies	Yes	Yes (for acceded ones)	Yes	No	No

6. Roadmaps for Each Form of LLC Reorganization

Form of Reorganization	Main Stages	Documents	Legal Consequences
Merger	1) Decision of general meetings of all companies. 2) Notification of registration authority and creditors. 3) Drafting of transfer deed. 4) Approval of new charter. 5) State registration of the new company.	Transfer deed, minutes of general meetings, new charter	Termination of all companies involved; creation of a new company with universal succession
Accession	1) Decision of general meetings of the acceding and receiving companies. 2) Notification of creditors. 3) Drafting of transfer deed. 4) Amendments to the charter of the receiving company. 5) State registration of amendments.	Transfer deed, amended charter of the receiving company	Termination of the acceding company; all rights and obligations transferred to the successor
Division	1) Decision of general meeting on division. 2) Notification of creditors. 3) Drafting of separation balance. 4) Preparation and approval of new charters. 5) State registration of new companies. 6) Removal of the previous company from the register.	Separation balance sheet, new charters, meeting minutes	Termination of the original company; creation of new companies with distributed rights and obligations
Separation	1) Decision of general meeting on separation. 2) Notification of creditors. 3) Drafting of separation balance. 4) Approval of new charters for separated companies. 5) State registration of new companies. 6) Amendments to the charter of the original company.	Separation balance sheet, new charters, amendments to the original charter	The original company remains; new companies are created with part of its rights and obligations
Transformation	1) Decision of general meeting (usually unanimous). 2) Notification of creditors. 3) Drafting of transfer deed. 4) Preparation of new charter in the new legal form (e.g., JSC). 5) State registration of amendments.	Transfer deed, new charter, meeting minutes	The company remains; only its organizational and legal form changes, with universal succession preserved

Conclusion

Each form of reorganization has its own specificity:

Merger and accession — aimed at business concentration;
Division and separation — aimed at diversification and redistribution of resources;
Transformation — aimed at changing the organizational and legal status.

All forms share universal succession and the obligation to respect the interests of creditors and participants.