TURKMENISTAN: Compliance vs Regulations - A Guide for Businesses

Compliance with anticorruption regulations is crucial for businesses operating in Turkmenistan. While there are general restrictions and duties imposed on public servants, the lack of clear guidelines and regulations can lead to confusion and risk for companies.

Public Servant Restrictions and Duties

According to Article 19 of the Law on Public Service, public servants are prohibited from engaging in any other paid activity except:

• Academic work
• Research activities
• Creative work

They are also barred from using state property and official information for personal gain or employing citizens and legal entities for personal benefit while discharging their duties. Additionally, relatives are not allowed to serve in the same governmental entity or be interdependent.

Gifts and Benefits

There is no explicit prohibition on acceptance by public servants, but gifts carrying a company logo may be less likely to be characterized as bribes. However, gifts of any value can be considered a bribe if given in exchange for an action or omission.

• The definition of gifts and their permissible value is unclear
• Gifts valued over 500 Turkmen manats (approximately $175 USD) must be reported for tax purposes

Business Courtesies

Business courtesies, such as meals and refreshments, are allowed without monetary limitations if related to business meetings or national holidays. However, providing these benefits to public servants requires formal approval from a superior official or agency.

• Meals and refreshments can be provided without limit if related to business meetings or national holidays
• Formal approval is required for providing benefits to public servants

Facilitation Payments

Facilitation payments to public officials will be considered bribes unless officially permitted. For example, payments made to speed up administrative processes may be acceptable.

Best Practices

In practice, it’s crucial for companies to approach gift-giving and business courtesies on a case-by-case basis, taking into account local customs and traditions. The best practice is to:

• Request formal approval from superiors
• Provide detailed explanations of the program and expenses

Conclusion

While anticorruption regulations are in place, the lack of clear guidelines and customs can lead to confusion and risk for companies operating in Turkmenistan. It’s essential to seek local counsel and follow best practices to minimize reputational damage and personal liability.

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