What is Related parties?
Persons who, for tax purposes, can influence the terms of each other's transactions or the results of each other's activities. Under Article 37 of the Tax Code, influence may be exercised through participation in capital or another ability to determine decisions, and it is taken into account whether it is exercised directly or jointly with other related parties. The cases that the Code recognises as related are in the list below (11 items). There are also cases that do not create a relationship: influence arising from a dominant position in the market or a similar situation; the state's participation in legal entities of Uzbekistan, by itself. A relationship on other grounds not in the list is recognised by a court.
- One legal entity participates in another directly and (or) indirectly by more than 20 percent
- An individual participates in a legal entity directly and (or) indirectly by more than 20 percent
- The same person participates by more than 20 percent in each of several legal entities (those legal entities among themselves)
- A legal entity and a person with the authority to appoint (elect) its sole executive body or at least 50 percent of its collegial executive body or board of directors (supervisory board)
- Legal entities in which at least 50 percent of the collegial executive body or board of directors (supervisory board) was appointed (elected) by decision of the same person
- Legal entities in which more than half of the members of the collegial executive body or supervisory board are the same individuals
- A legal entity and the person exercising the powers of its sole executive body
- Legal entities whose sole executive body powers are exercised by the same person
- Persons in a chain of participation, if each link in the chain directly holds more than half of the next legal entity
- Individuals one of whom is subordinate to the other by position
- An individual and his or her spouse, parents (including adoptive parents), the spouse's parents, children (including adopted children), brothers and sisters (including those with both parents in common and those with only the father or only the mother in common), guardian (custodian) and the person under guardianship
Source: Soliq kodeksi, 37-modda