The World Bank Modernization of Real Property Registration and Cadastre (P151746) REPORT NO.: RES54549 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF MODERNIZATION OF REAL PROPERTY REGISTRATION AND CADASTRE APPROVED ON MAY 24, 2016 TO THE REPUBLIC OF UZBEKISTAN URBAN, RESILIENCE AND LAND EUROPE AND CENTRAL ASIA Regional Vice President: Anna M. Bjerde Country Director: Tatiana A. Proskuryakova Regional Director: Sameh Naguib Wahba Tadros Practice Manager/Manager: Christoph Pusch Task Team Leader(s): Nadege Orlova The World Bank Modernization of Real Property Registration and Cadastre (P151746) I. BASIC DATA Product Information Project ID Financing Instrument P151746 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 24-May-2016 31-Dec-2022 Organizations Borrower Responsible Agency Cadastre Agency under the State Tax Committee of the The Republic of Uzbekistan Republic of Uzbekistan Project Development Objective (PDO) Original PDO The Project’s Development Objective is to establish an efficient and accessible real property registration and cadastre system in the Republic of Uzbekistan as part of the national eGovernment structure and services. The project will achieve this by: (i) improving business processes and customer orientation in the real property registry and cadastre; (ii) creating a fully digital real property registry and cadastre system (i.e. IISRPRC) accessible online to the public; (iii) improving the regulatory and operational environment of the real property registry and cadastre; (iv) facilitating spatial data access, exchange and sharing at national level; and (v) raising awareness on the importance of real property rights. Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-57610 24-May-2016 16-Sep-2016 12-Jan-2017 31-Dec-2022 16.70 16.24 .46 The World Bank Modernization of Real Property Registration and Cadastre (P151746) Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No II. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES A. Project Status and Rationale for Restructuring 1. This restructuring paper seeks the approval to extend the closing date of the Credit financing Modernization of Real Property Registration and Cadastre Project (Project) for eight (8) months from December 31, 2022, to August 31, 2023. If approved, it will be third extension of the Credit closing date resulting in a cumulative extension of 23 months from the original closing date of September 30, 2021. The IDA credit for the Project in amount of US$20 million was approved on May 24, 2016 and became effective on January 12, 2017. The Project has been under implementation for almost six years and already underwent three restructurings. The first restructuring was processed in February 2020 following recommendations of the midterm review to improve consistency and measurability of the Results Framework (RF) to better monitor achievement of the Project Development Objective (PDO). The second restructuring was processed in July 2021 and included: (i) extension of the Credit closing date by 12 months from September 30, 2021, to September 30, 2022 to allow the Project to successfully overcome remaining technical, administrative and COVID-19-related constraints and fully achieve its development objectives, (ii) further revision of the RF, and (iii) updated implementation arrangements to reflect the change of the Project Implementing Agency. The third restructuring was processed in September 2022 and included: (i) extension of the Credit closing date by three (3) months from September 30, 2022, to December 31, 2022 to enable the Project to successfully overcome remaining technical constraints and fully achieve its development objectives, and (ii) partial cancellation of IDA credit funds in the amount of US$3.3 million, allowing for release of the unutilized contingency funds and funds accumulated as part of securing parallel financing and savings. 2. Overall Project Status. As of December 2022, the Project has partially achieved its PDO to establish an efficient and accessible real property registration and cadastre system in the Republic of Uzbekistan as part of the national eGovernment structure and services and has already disbursed a total of US$16.24 million (97.27 percent of net 3. commitments). The Project was supposed to achieve the PDO by: (i) improving business processes and customer orientation in the real property registry and cadastre; (ii) creating a fully digital real property registry and cadastre system (UzKAD) accessible online to the public; (iii) improving the regulatory and operational environment of the real property registry and cadastre; (iv) facilitating spatial data access, exchange and sharing at national level; and (v) raising awareness on the importance of real property rights. 4. Progress towards achieving the PDO and Implementation Progress are rated Moderately Satisfactory. To date, the Cadastre Agency (CA) successfully completed a massive nationwide operation of digitization of all cadastral and registration documentation, which outpaced the initially set target by 2.5 times. Between 2019 and 2020, more than 7.5 million of cadastral and registration documents have been digitized, creating the foundations for full digitalization of the land administration services in the country. Aerial imagery acquisition works - another critical Project-financed activity - has been completed for eleven regions (124,816 sq. km) and covered 90 percent of inhabited territories of Uzbekistan with precise and up-to date orthophoto maps. Additionally, the CA submitted to the Parliament for adoption the concept of the National Spatial Data Infrastructure (NSDI). 5. However, for the Project to fully achieve its development objectives and met all PDO targets, additional time is needed to complete the main Project activity, operationalization of the Integrated Information System for Real Property Registration and Cadastre (UzKAD). To date, UzKAD functional development, User Acceptance Tests (UAT), The World Bank Modernization of Real Property Registration and Cadastre (P151746) deployment of software and IT equipment in all 206 offices of the CA are already completed. UzKAD is connected to the State eServices system “Gosuslugi” and is currently used for all types of new incoming applications for cadastral and registration services. The presidential decree N 198 that was signed on August 22, 2022, commits to the full digitalization of the Uzbek Land Administration System and designates the UzKAD as the holistic and guaranteed by the State system fulfilling all registration functions nationwide. As much as this provision ensures future sustainability of the UzKAD, it also imposes additional requirements for completion of its operationalization - the UzKAD should progressively upload all the available cadastral and registration data into its database, and then other legacy cadastral and registration systems will be fully deprecated. 6. As of now UzKAD already uploaded around 30 percent of the data. Remaining data (1,700,000 records, mostly on the apartments) should be completed and corrected prior to their upload into the UzKAD. According to initially conducted tests done on sample data this activity was supposed to be done semi-automatically, but it was recently found that completeness and consistency of the existing data overall require significant enhancement prior to their upload into the UzKAD. Therefore, the implementation of this activity would require more time and could not be completed by the current closing date of December 31, 2022. The proposed eight months extension of the Credit closing date until August 31, 2023 would secure the needed additional time to fully complete the data transfer from the legacy systems that is critical to achieve the operationalization of the UzKAD and fully meet the corresponding part of the PDO. Furthermore, this extension will also allow to finalize the ongoing staff training and capacity building activities which are essential to enable the staff to operate and maintain the UzKAD. Training of the CA staff is well advanced with 2,395 staff members out of target 3,000 already trained (which represents around 80 percent). 7. The restructuring will not change the PDO and associated outcomes. The Project is compliant with all the legal covenants. The Project’s PDO remains relevant and will be achieved if the Project’s closing date is extended. Fiduciary arrangements continue to be satisfactory. Procurement Management is rated as “Moderately Satisfactory” and Financial Management is rated as “Satisfactory”, and there are no outstanding audits. Management of Environmental and Social Safeguards is rated as “Satisfactory”, and no safeguard’s related issues have been reported. The Project’s environmental category does not change and remains Category B. B. Description of Proposed Changes 8. In response to the Ministry of Finance (MoF) request of December 14, 2022, the proposed restructuring seeks extension of the IDA credit Closing date from December 31, 2022 to August 31, 2023. This will be the third extension of the Project closing date, which cumulatively will extend the overall closing date by 23 months. This extension will allow the CA, with support from the PIU to: (i) collect missing and harmonize existing data on the apartments prior to their integration into the UzKAD system to enable its full-fledged deployment for all types of transactions and deprecation of the other legacy systems; and (ii) finalize activities of training and capacity building. Those in turn will ensure successful completion of all Project activities and full achievement of the PDO by the extended closing date of August 31, 2023. Extension of the Project closing date will also ensure and enable continuous mobilization of the CA and PIU resources to prepare the subsequent Project in the area of Land Management already identified in the Country Partnership Framework. III. DETAILED CHANGES LOAN CLOSING DATE(S) The World Bank Modernization of Real Property Registration and Cadastre (P151746) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications 30-Sep-2022, 31-Dec- IDA-57610 Effective 30-Sep-2021 31-Aug-2023 31-Dec-2023 2022