The Regulation was developed in accordance with the presidential decree “On measures to regulate the activities of cotton and textile clusters,” Norma reports.

The creation of a cotton-textile cluster is carried out by a resolution of the Cabinet of Ministers on the basis of the conclusion of the republican commission. At the same time, the provision of a land plot to a cotton-textile cluster on the basis of a lease right is carried out on the basis of an applicant’s application in the manner prescribed by legislative acts.

When creating cotton-textile clusters, preference is given to an applicant who has a capacity of its own processing (at least yarn) of at least 50% of the produced or purchased raw cotton.

Based on the resolution of the Cabinet of Ministers on the creation of a cotton-textile cluster, a four-way agreement is concluded between the Ministry of Agriculture, the Association of Cotton-Textile Clusters of Uzbekistan, the Council of Ministers of Karakalpakstan or the regional khokimiyat, respectively, and the applicant for the creation of a cotton-textile cluster for a period of 30 years.

Moreover, if the applicant is an enterprise with foreign investment or a foreign legal entity, then the quadripartite agreement is concluded for a period of up to 25 years.

The adopted regulation indicates:

• Forms of cotton-textile clusters created for growing raw cotton or purchasing products from farms and other economic entities producing raw cotton;
• A set of documents submitted by the applicant to the center of public services together with an application for the organization of a cotton-textile cluster and the procedure for their consideration;
• The procedure for concluding a quadripartite agreement on the launch of a cotton-textile cluster;
• The rights and obligations established for the cotton-textile cluster and its members;
• Rights and obligations established for producers of raw cotton on the basis of a futures contract in order to establish relationships between suppliers and the cotton-textile cluster in accordance with market principles;
• The procedure for monitoring compliance by the cotton-textile cluster with obligations under agreements and the effectiveness of its activities;
• The procedure for terminating a quadripartite agreement in the event of default by the cotton-textile cluster.

All cotton and textile clusters in one region (in Karakalpakstan or the corresponding region) are allowed to carry out activities with farms on a contractual basis and farms – to voluntarily conclude futures contracts with these clusters for the supply of raw cotton.