TURKMENISTAN: A chance for the insurance market demonopolisation in 2014

Starting July 1st, 2014 in Turkmenistan the process of demonopolisation and privatisation of state property will begin, in accordance with the law adopted in December 2013 by the Turkmen Parliament. The new law enforcement also addresses the development of the insurance industry, as it allows the entrance of private capital in this area of business, previously completely controlled by the State through a state monopoly insurance company (The State insurance Company of Turkmenistan).

'The non-state sector has been formed within the economy of the country,' a Parliament's representative, quoted by EIN NewsDesk, said recently. 'Market institutions and new sectors - such as the securities market, joint stock companies, banks, a system of institutional investors and insurance companies - are being developed. Moreover, the shortage of goods was overcome and an internal conversion of the national currency, the manat, was ensured.'

According to the report, it was for the first time that the relevant law defined the main principles of denationalisation and privatisation, including the equality of citizens' rights, the provision of social protection of employees as well as state and public control, while implementing measures for the state property's privatisation.

According to the Law provisions, many state companies could be transformed into joint stock companies or private companies having the State as a founding co-owner. "The new feature of the law is that such forms of denationalisation and privatisation such as the sale of the state-owned shares, those on the stock exchanges, the direct sale of privatisation sites and the sale of state-owned facilities used on lease terms were additionally introduced into the relevant articles," the Parliament's representative said.

In order to avoid possible operational difficulties of the newly privatised companies, the disbursement term for the privatisation operations may be postponed by the authorised body for up to three years and by the Turkmen Cabinet of Ministers up to five years in certain cases, upon the proposal of the interdepartmental central committee.

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