Requirements for Implementing Digital Labeling in Different Types of Businesses. What Are the Differences?

In order to combat counterfeit and illegal products, the Government of Uzbekistan has decided to introduce mandatory labeling of products sold within the republic.

The reason for this decision was the identification of the overall level of the “shadow” economy in Uzbekistan: in 2019 it amounted to 52.11%, meaning more than half of the total market.

As a result:

• the consumer pays money for uncertified and possibly dangerous items, such as counterfeit medicine;
• the government does not receive taxes and excise duties;
• legal businesses invest money in developing new products but cannot compete with cheap counterfeits.

Why Businesses Must Work with Labeling

Based on Resolution of the Cabinet of Ministers No. 833 dated 12/31/2020, it is established that:

• the obligation to label goods subject to mandatory digital labeling rests with manufacturers and importers;
• enterprises engaged in retail or wholesale trade of goods subject to mandatory digital labeling are required to connect to the national information system for monitoring labeling and tracking products;
• catering enterprises are also required to register in the digital labeling system since they sell alcohol and thus become participants in digital labeling and must be registered in the system.

Thus, labeling affects:

• Manufacturers
• Importers
• Representatives of wholesale and retail trade

The labeling rules cover all market participants because achieving the goals of reducing illegal products in the market is only possible with active participation in labeling by representatives of all links in the chain from production to sale.

Why Businesses Should Work with Labeling

Manufacturers, along with consumers, suffer from the abundance of counterfeit goods on the market. Counterfeiting primarily affects the income and reputation of manufacturers. The introduction of mandatory product labeling will benefit both domestic and foreign manufacturers.

Thus, manufacturers will gain:

• Increased revenue by displacing illegal products from the market
• Equal competition conditions
• Process optimization and cost reduction
• Improved business analytics quality based on labeling system data
• Protection of the brand of a conscientious manufacturer

Mandatory Steps for Working with Labeling

The number of steps required for working with labeled products differs for each participant in the product circulation. Manufacturers and importers, who are responsible for applying labeling codes, are the most involved in working with labeled products.

All mandatory steps for different participants in circulation are presented in the summary table below.

*A minimum balance of funds is implied so that when reporting the use of codes, the amount is deducted according to the submitted data.

Other Useful Articles:

• Registration and Activation of an Account in the NIS “ASL BELGISI” Personal Cabinet
• What is Digital Labeling
• Legislation on Mandatory Digital Labeling of Goods in Uzbekistan
• NIS “Asl Belgisi”: User Guide