A. General
1. What is the main legal framework applicable to companies in your jurisdiction?
The most relevant legal acts for companies in Tajikistan include: (i) the Civil Code, (ii) the Tax Code, (iii) the Registration of Legal Entities and Individual Entrepreneurs Act, (iv) the Competition Protection Act, (v) the Limited Liability Companies Act, and (vi) the Joint Stock Companies Act.
Besides the aforementioned laws, there are several other regulations that may apply, depending on the specific business activities a company undertakes within Tajikistan.”
Additionally, after reviewing the information in our guide section and the current legal framework, we have not identified any significant updates or developments that need to be added to the guide.
2. What are the most common types of corporate entities (e.g., joint stock companies, limited liability companies, etc.) used in your jurisdiction? What are the main differences between them (including but not limited to with regard to the shareholders' liability)?
A branch office or limited liability company is the most popular and widely used type of corporate entity form. Mostly, foreign parties choose to register a branch or a limited liability company if it aligns with their intended activity. The only distinction relates to the taxation of profits.
B. Foreign Investment
3. Are there any restrictions on foreign investors incorporating or acquiring the shares of a company in your jurisdiction?
There are no legal limitations on foreign investors forming a company or purchasing shares of a company. Although that hasn't happened in our practice, it is possible that there are some unwritten restrictions that weren't made known to the public, and only made known when relevant party approaches the authorities.
4. Are there any foreign exchange restrictions or conditions applicable to companies such as restrictions to foreign currency shareholder loans?
Restrictions only apply to domestic loans; such loans must be in national currency. There are no restrictions on foreign loans.
5. Are there any specific considerations for employment of foreign employees in companies incorporated in your jurisdiction?
Yes. The companies are required to obtain a license (which entails having in-house lawyer), and comply with specified quota, which is determined annually at the start of second quarter while the employees are required to obtain work permits.
C. Corporate Governance
6. What are the standard management structures (e.g., general assembly, board of directors, etc.) in a corporate entity governed in your jurisdiction and the key liability issues relating to these (e.g., liability of the board members and managers)?
While joint stock firms with more than fifty shareholders must have a board of directors, limited liability companies and joint stock companies with less than fifty owners are free to pick their management structures. Therefore, a CEO-only organization is the most common type of management structure.
7. What are the audit requirements in corporate entities?
The audit is not mandatory. An audit can be carried out at the request of participants for the limited liability company or shareholders for the joint stock companies.
D. Shareholder Rights
8. What are the privileges that can be granted to shareholders? In particular, is it possible to grant voting privileges to shareholders for appointment of board members?
A limited liability company's highest governing body is the general meeting of participants. The general meeting of participants has sole authority over the appointment of the board of directors. In addition to their statutory rights, the general meeting of participants' competence may also be expanded in accordance with internal documents in other areas (charter, by-laws, foundation agreement, etc.).
9. Are there any specific statutory rights available to minority shareholders available in your jurisdiction?
There are currently no special statutory rights available to minorities in Tajikistan, in contrast to the majority of international states that have given minority shareholders special legal protections.
10. Is it possible to impose restrictions on share transfers under the corporate documents (e.g., articles of association or its equivalent in your jurisdiction) of a company incorporated in your jurisdiction?
In general, a participant of a limited liability company has the legal right to withdraw at any moment, without the approval of other participants. The withdrawal term declaration may be determined by the constituent documents since it is not explicitly stated by law.
If a participant decides to withdraw, the share will be transferred to the company as soon as a withdrawal application is submitted. In addition, the company is required to pay the participant the actual value of the share, as determined by accounting data for the year in which the application was submitted, or, with the participant's consent, to provide property in kind of the same value. In the event that the contribution to the company's authorized capital is not fully paid, the actual value of the part of the participant's share, proportionate to the paid part of the authorized capital, is also due.
11. Are there any specific concerns or other considerations regarding the composition, technical bankruptcy and other insolvency cases in your jurisdiction?
Technical bankruptcy is not defined under the current laws. The debtor's formal bankruptcy (insolvency) is announced at the general meeting of creditors, or it is resolved in court. Apart from this, there are no other significant issues or matters to be thought about in relation to the aforementioned; nonetheless, each situation should be considered separately due to the various factors and elements involved.
E. Acquisition
12. Which methods are commonly used to acquire a company, e.g., share transfer, asset transfer, etc.?
The most commonly used method to acquire a company is through share purchase.
13. What are the advantages and disadvantages of a share purchase as opposed to other methods?
Gaining ownership of the business and reaping the rewards of participation, including the possibility of dividends, simplicity of share transfer, and statutory ownership rights, is the main benefit of buying shares. Other strategies entail buying assets that don't give you direct control over the business, which restricts your options and the advantages of being a shareholder.
A share purchase has some limits and/or conditions that must be met as a drawback. A change in the shareholding structure, for instance, necessitates the company to go through the so-called “re-registration” process, which could take several months and necessitates communicating with the state authorities. If thresholds are met, obtaining an approval from governmental agencies is necessary for a share purchase.
14. What are the approvals and consents typically required (e.g., corporate, regulatory, sector based and third-party approvals) for private acquisitions in your jurisdiction?
For general sector, corporate (approval of appropriate body (if required by company bylaws)) and competitive (if triggered), and for finance in addition to competitive (if triggered) approval of the National Bank of Tajikistan is required.
15. What are the regulatory competition law requirements applicable to private acquisitions in your jurisdiction?
There are two triggers:
- If the total book value of the acquirer is USD 685,640 in 2025, The amounts have changed due to the fact that in 2025 the settlement figure has increased from 72 to 75 TJS (this is approximately from USD 6.58 to USD 6.86). The acquirer is required to notify the Antitrust Service within 15 days following the transaction; and
- If the total book value of the acquirer is USD 1,371,279 in 2025. The amounts have changed due to the fact that in 2025 the settlement figure has increased from 72 to 75 TJS (this is approximately from USD 6.58 to USD 6.86). The acquirer is required to apply for preliminary consent from the Antitrust Service.
While reviewing the documents if the notification requirement is triggered, there is a possibility that the Antitrust Service may deem that the transaction requires its preliminary consent rather than just notification. Likewise, in some cases, Antitrust Service may require the provision of additional documents and information.
16. Are there any specific rules applicable for acquisition of public companies in your jurisdiction?
There are certain regulations that apply to public firms (if they are open joint stock companies that are listed) regarding the listing of shares and the subsequent sale and/or purchase of those shares via the stock market. The stock exchange market, however, is still in its infancy, therefore there is still considerable room for development and problems that need to be resolved. The Central Asian Stock Exchange (local stock exchange), where public firms are normally listed, has its own set of rules and regulations governing how it runs and how listed companies handle share trading.
17. Is there a requirement to disclose a deal, for instance to regulatory authorities? Is it possible to keep a deal confidential?
If competition law requirements are triggered, the deal must be disclosed to the antitrust services, other than that, there are no requirements to disclose the deal to third parties.
18. Can sellers be restricted from shopping around during a negotiation process? Is it possible to include break fee or other penalty clauses in acquisition documents to procure deal exclusivity?
The parties are free to choose the terms of the agreement if it complies with the provisions of the country whose law was the law was chosen as the governing law.
19. What are the conditions precedent in a typical acquisition document? Is it common to have conditions to closing such as no material adverse change?
A full list of the conditions precedent (“CP”) used in a typical acquisition document cannot be created due to a number of elements and circumstances. Typically, it relies on the industry, the target company's activity range, its assets, and other factors. CPs regarding the following are most likely to be included by a firm ready to move forward with the purchase of a target company:
(i) Regulatory approvals (if required); (ii) Third-party consents (such as those of the target company's current creditors); (iii) Target company due diligence (including legal, financial, and/or tax); (iv) Representations, warranties, and covenants (common negative covenants might not be enforceable in Tajikistan due to conflict with the statutory provisions of the law); and (v) Other CPs as determined by a prospective buyer.
Conditions for closing, including the absence of any major adverse change, are frequently included. The majority of the CPs listed above are not usually included in local transactions because not all of them can be enforced under Tajik law. Nonetheless, such CPs are frequently utilized in transactions involving local parties that are controlled by foreign law.
20. What are the typical warranties and limitations in acquisition documents? Is it common to obtain warranty insurance?
It is typical to contain warranties and restrictions relating to the change in control, the lack of any liens or other claims secured by the assets, and the absence of any current or pending litigation. Other guarantees and limits may exist, but not all of them may be used or enforced in accordance with Tajik laws. Due to the fact that some of the shareholders' rights are statutory in nature and cannot be negated by any contractual restrictions, common negative covenants that would prevent shareholders from choosing whether to alienate shares to other parties cannot be implemented.
We have not encountered the use of insurance; the more common alternative is to have a guarantor.
21. Is there a requirement to set a minimum pricing for shares of a target company in an acquisition?
By law, no. However, if the price is too low, this may draw unwanted attention from the tax authorities, therefore, the price must not be lower than the market price for similar companies.
22. What types of acquisition financing are available for potential buyers in your jurisdiction? Can a company provide financial assistance to a potential buyer of shares in the target company?
These types of financing are not practiced in Tajikistan. Acquisition transpires through direct purchase of the shares via share purchase agreement.
23. What are the formalities and procedures for share transfers and how is a share transfer perfected?
A share purchase agreement must be finalized in writing and signed with wet ink. A power of attorney (from the alienated and/or receiving party) may be used to appoint representatives.
The new shareholder is required to submit a filing with the regulatory body following the completion of the transaction in order to introduce the necessary changes to the register to reflect the change in shareholder.
24. Are there any incentives (such as tax exemptions) available for acquisitions in your jurisdiction?
No. There are no incentives.
F. Enforceability
25. Can acquisition documents be executed in a foreign language?
Yes. But recommended practice is to have documents bilingual (foreign language and Tajik language), as the documents have to be translated into Tajik language and translation notary certified for them to be considered by the state authorities.
26. Can acquisition documents be governed by a foreign law?
Yes. Acquisition documents can be governed by a foreign law.
27. Are arbitration clauses legally permissible or generally included in acquisition documents?
Arbitration clauses are legally permissible, binding and generally included in agreements with foreign parties.
28. Are there any specific formalities for the execution of acquisition documents? Is it possible to remotely/digitally sign documents?
There are no specific formalities other than those mentioned above. The documents can be signed remotely, but it has to be signed in wet ink and not e-signature (e.g., docusign), since currently, e-signature is not as widely recognized by the state bodies.
G. Trends and Projections
29. What are the main current trends in M&A in your jurisdiction?
The government has made significant strides in the privatization of state-owned assets and inviting foreign investors to become joint owners with the government ever since the dissolution of the Soviet Union.
Due to the richness of various natural resources in Tajikistan, there has been substantial advancement in the mining industry, with several mining businesses being invested into by foreign investors and co-owned with the government.
30. Are any significant development or change expected in the near future in relation to M&A in your jurisdiction?
Unfortunately, the lawmaking processes are not transparent, therefore, we cannot tell whether there are any changes are expected in the near future.
Originally published by Ergun Books on the 22nd of July, 2025.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
