This Client Update includes amendments to the legislation of the Republic of Kazakhstan in October 2012.
These regulatory legal acts concern both a public sector and a private sector. Among them there are some which may attract your attention and affect your business in Kazakhstan in a certain way.
We would like to draw your attention to the following regulatory legal acts:
1) AMENDMENTS TO THE RESOLUTION OF THE GOVERNMENT OF ROK «ON APPROVAL OF INCREASING INDUSTRY INDICES» (EFFECTIVE UPON EXPIRY OF TEN CALENDAR DAYS FROM THE DATE OF THE FIRST OFFICIAL PUBLICATION), INTRODUCED BY THE RESOLUTION OF THE GOVERNMENT OF ROK No.1220 DATED 19.09.12
Increasing industry indices for calculation of minimum standard payment for the labour of an employee, working in heavy, harmful (extra harmful) and hazardous conditions:
In mining and smelting sector is equal to 1,8;
In electric – power industry sphere is equal to 2,0.
1) THE LIST OF GOODS, CHARGED BY VALUE-ADDED TAX AT ZERO RATE
In accordance with the item 1 of article 244-2 of the Tax Code, the list of goods, charged by value-added tax at zero rate, sold on the territory of special economic zones, wholly consumed during the activity, corresponding to the purpose of establishment of these special economic zones: 1) «Astana – a new city »; 2) «Aktau Seaport»; 3) «Innovation technologies park»; 4) «Ontustik»; 5) «National industrial oil and gas technology park»; 6) «Burabai» was approved.
Resolution is entered into effect from 1 January 2012.
2) DECREASING COEFFICIENT TO THE ESTABLISHED RATES OF MINERAL PRODUCTION TAX
Government of RoK approved the list of crude oil products where decreasing coefficient of 0,5 is applicable to the established rates of mineral production tax provided that such products were not actually imported to RoK and a legal entity is not a payer of rent export tax.
This resolution is entered into effect from the date of signing and remains in force till 1 January 2015.
1) RULES OF INCLUSION OF INVESTMENT PROJECTS INTO THE LIST OF INVESTMENT STRATEGIC PROJECTS
Resolution of the Government No. 1066 dated 22 August approved the rules, which determine the procedure of inclusion of investment project into the list of investment strategic project. Investment strategic project is an investment project, having the high added value, that included into priority activities within the economic activities classification, as well as meets one of the following criteria: 1) is aimed to manufacture the high-technology products; 2) the amount of investments of this project is not less than five million multiple of the amount of minimum calculation index. For inclusion of investment project into the list of strategic projects, the applicant submits an application with attachment of required documents to the Investments Committee of the Ministry of Industry and New Technologies within first and third quarter of the year, but not later than 30th date of the last month of the relevant quarter. Consideration is carried out within second and fourth quarter and by its results the Committee within thirty working days develops and introduces to the Government a resolution draft on inclusion of investment projects into the indicated list.
Rules came into force on 26 September 2012.
2) RULES OF PERMISSION ISSUANCE ON VOLUNTARY LIQUIDATION OF NATIONAL PENSION FUND (NPF)
Rules are developed in accordance with Laws of the Republic of Kazakhstan “On pension provision”, “On state regulation and supervision of the financial market and financial organizations” and regulate the procedure of obtaining a permission on voluntary liquidation of pension savings fund (hereinafter – Fund). According to the rules, the Fund, upon making a decision on liquidation, files a petition with attachment of required documents to the Committee for the control and supervision of the financial market and financial organizations of the National Bank of the Republic of Kazakhstan. In this case the petition and accompanied documentation are to be signed and stamped by first head of the Fund. In the case of submission of complete package of documents as well as their compliance with legislation of the Republic of Kazakhstan and upon sufficiency of Fund’s money to fulfill its obligations, the Committee issues permission on voluntary liquidation. Review of documents shall take two months. The decision is brought to the notice of executive officers and shareholders of the Fund within ten calendar days from the date of its adoption.
Rules came into force on 14 October 2012.
3) IN ACCORDANCE WITH RESOLUTION OF THE GOVERNMENT OF ROK No.1383 DATED 31.10.12 AMENDMENTS ARE INTRODUCED TO THE RULES OF STATE GUARANTEE PERFORMANCE BY A RECIPIENT OF PENSION PAYMENTS ON SAFETY OF MANDATORY PENSION CONTRIBUTIONS IN PENSION SAVINGS FUNDS IN THE AMOUNT OF ACTUAL PAID-IN MANDATORY PENSION CONTRIBUTIONS TAKING INTO ACCOUNT INFLATION RATE AS FROM THE DATE OF ACQUISITION OF A RIGHT ON PENSION PAYMENTS (IS ENTERED INTO EFFECT UPON THE EXPIRY OF TEN CALENDAR DAYS FROM THE DATE OF FIRST OFFICIAL PUBLICATION)
Particularly, the Rules are amended by the norm that in the case of taking out of pension savings and then, in the case of return of mandatory pension contributions in pension savings fund the moment of acquisition of the right to pension payments is established as on the date of first taking out of pension savings.
1) CONTROL RIGHT OVER THE LEGAL ENTITY UNDER AGREEMENT OR OTHERWISE
Instruction is approved by the Resolution of the Government of National Bank No.217 dated 4 July, specifying the grounds, on the basis of which a one body individually or jointly with another body acquires control right over the legal entity under agreement or otherwise. The first ground is that the one body individually or jointly with other bodies has trust agreements on the voting of more than fifty percents of outstanding shares of the legal entity or has a right on determination of decisions more than fifty percents of participation interests in the authorized capital of the legal entity. In accordance with the second ground the legal entity is recognized as controlling if it funds individually or jointly with other bodies another legal entity in the amount, exceeding shareholders’ interests of the financed. According to the third ground for recognition of control over the legal entity is necessary to receive services by controlling party individually or jointly with other bodies from controllable organization, having the debt before these bodies and payment for which was equal not less than half of incomes of the legal entity, being controllable and rendering of these services. The Committee for the control and supervision of the financial market and financial organizations of the National Bank of RoK carries out collection of information about bodies to be exercised control and organizations to be controllable in the purposes of exercising of consolidated supervision functions.
Instruction came into effect on 7 October 2012.
1)PEOPLE ENCOURAGEMENT RULES ARE APPROVED, INFORMED ABOUT CORRUPTION MATTER OR OTHERWISE HELPING IN ANTICORRUPTION EFFORTS (Resolution of the Government of RoK No.1077 dated 23.08.12 (is entered into effect upon the expiry of ten calendar days from the date of first official publication)
Rules are developed in accordance with item 2-1 of article 7 of Law of RoK «On anticorruption efforts» and determine the procedure of people encouragement, informed about corruption matters or otherwise helping in anticorruption efforts.
For people, informed about corruption matters or otherwise helping in anticorruption efforts are established encouragements in the form of single money considerations.
Encouragement in the form of money consideration is established in the following amounts:
In cases, prescribed by item 6 of Rules, encouragements may be established in the form of appreciation letter or expression of gratitude.
Encouragements financing is carried out at the expense of republican budget.
GENERAL BUSINESS MATTERS
1) STATE REGULATION OF CERTAIN TYPES OF GOODS CIRCULATION
The following price limitations on oil retail trade are established (amounts including VAT):
Diesel oil – 94 tenge per liter;
Automobile gas oil – 80 – 89 tenge per liter;
Automobile gas oil – 92 – 110 tenge per liter.
See order of the Chairman of Agency of the RoK for regulation of natural monopolies No.249- OD dated 02.10.12.
1) 7 May – a public holiday of RoK Law “On introduction of amendments to Law “On holidays” is adopted by Senate provided that 7 May will become a public holiday in Kazakhstan. Law is adopted on 4 October 2012.
Should you have any additional questions, please feel free to contact us.
Information contained in this Client Update is of general nature and cannot be used as legal advice or recommendation. Please seek for a specific advice in relation to any questions. Please note that Kazakhstan and Turkmenistan are emerging economies and their legislation and legal systems are in constant development. Should you have any questions or would like to discuss subjects addressed in this Client Update please contact us.