On Changes in Enforcement Proceedings Legislation

The Law of the Republic of Kazakhstan dated June 26, 2020, introduced some changes and additions to the Law "On Enforcement Proceedings and the Status of Bailiffs" (hereinafter - the Law). There are a lot of changes, and in order to systematize them and understand what exactly has changed, this article contains new provisions, as well as changes to previously existing articles in comparison with the previous edition of the Law.

• The list of enforcement documents has been expanded and now includes:

- Writ of execution issued based on decisions of the court of the Astana International Financial Center;

- Orders of the court of the Astana International Financial Center on securing a claim or canceling the securing of a claim;

- Order of the state labor inspector on the payment of wages by the employer.

• The cancellation of the private enforcement agent’s resolution is now carried out not only by the private enforcement agent who issued it, but also by other private enforcement agents in case the proceedings were transferred to them.

• The interrupted period for the presentation of the court order shall restart after the break, and the time elapsed before the break shall now be included in the new period. Previously it was not included.

• The prosecutor has the right to withdraw the enforcement document from the bailiff, transfer it weather to the appropriate justice body, or the Regional Chamber of the Private Enforcement Agents according to the territoriality for transfer to another bailiff.

• The procedure for notifying and summoning participants in enforcement proceedings has been specified. The agenda or notification content is clearly regulated, as well as the procedure for sending them.

• A notice or a summons can also be sent using text messages to a subscriber number of cellular communication or e-mail, the state automated information system of enforcement proceedings (AISEP), as well as using other means of communication that ensure fixation of a notification or a call. The document confirming the sending of the message is attached to the materials of the enforcement proceedings.

• The refusal of the addressee to accept the summons or notification is not an obstacle to the execution of enforcement actions, and this person shall be considered duly notified.

• The parties to the enforcement proceedings have the right to familiarize themselves with the enforcement proceedings through the AISEP personal account.

• The minimum amount for a temporary restriction on travel outside the Republic of Kazakhstan was increased from 20 MCI to 40 MCI.

• The bailiff is now obliged to issue an order on a temporary restriction to travel overseas, regardless of the presence or absence of an application from the claimant. In this case, a temporary restriction on leaving the country is imposed only after the expiration of five working days from the date of the proper notification of the debtor about the application of the time restriction. The removal of the temporary travel restriction must be made within one working day, instead of three, some cases including the cancellation of the decision to initiate enforcement proceedings.

• The obligation to send a resolution to initiate enforcement proceedings to the debtor previously provided for in paragraph 1 of Art. 37 of the Law is now excluded.

• If there are grounds stipulated by the Law, enforcement proceedings are subject to suspension within one working day (the term was not provided earlier).

• Filing a complaint with the court against the actions or decisions of the bodies (officials) that imposed an administrative penalty and the release from the seizure of property are no longer grounds for suspension of proceedings.

• Tracing the debtor is carried out under the sanction of the prosecutor, not the court.

• The debtor's departure for permanent residence outside the Republic of Kazakhstan became a ground for the return of the enforcement document to the claimant if the debtor does not own any property in the Republic of Kazakhstan.

• Upon the return of a writ of execution at the request of the claimant, the enforcement measures are subject to cancellation only if the claimant reimbursed the actually incurred enforcement costs and paid for the services of the private enforcement agents.

• Measures of compulsory execution are now subject to cancellation in case of expiration of the term for presenting an enforcement document for compulsory execution.

• The private enforcement agent, who has sent the enforcement document to the relevant regional chamber according to the territoriality, is obliged to return the claimant the unused advance payment.

• A bailiff who sold a property at auction is obliged to cancel all arrests against such property, including arrests imposed by other bailiffs, except for the injunction measures imposed by the court.

• Claimants of the same queue, when accepting the debtor's property in kind, reimburse other claimants expenses for the performance of enforcement actions and payment for the services of the private enforcement agents in proportion to the value of the transferred property.

• It is not allowed to seize and levy execution on the money in the current account of the private enforcement agents, intended for storing the amounts collected in favor of the claimants.

• When foreclosure is levied on wages and other types of income of the debtor, the decision on withholding the awarded amounts is sent for execution not only to the employer with whom the debtor has an employment relationship but also to the person from whom the debtor receives income.

• The bailiff determines the alimony debt quarterly.

• The decision shall be sent to the parties to the enforcement proceedings for review Within three working days after the determination of the debt.

• The penalty in determining the alimony debt is now calculated not based on the refinancing rate of the National Bank of the Republic of Kazakhstan, but in the amount of 0.1% of the amount of unpaid alimony for each day of delay.

• The amount of penalty interest in the state revenue for non-execution of a binding enforcement document was reduced from 5 to 2 MCI. At the same time, the maximum amount of the levied fine for individuals cannot exceed 360 MCI, for legal entities - 900 MCI (for small and medium-sized businesses 600 MCI, and for debtors belonging to socially vulnerable segments of the population - 15 MCI).

• Article 115 of the Law, which provided the right of the claimant to advance the expenses of both state and private bailiffs, was removed.

• According to the enforcement documents on child custody, payment for the services of the private enforcement agents is equally shared between the claimant and the debtor.

• According to the enforcement document on securing the claim, payment for the private enforcement agent’s services is collected from the party that filed the request for injunction measures.

• According to the enforcement document on cancellation of the claim injunction, payment for the services of the private enforcement agent is recovered from the person who filed a petition for injunction measures and who has recalled the claim. In case of success of the action, payment for the services of the private enforcement agent under the enforcement document on the cancellation of the claim injunction shall be collected from the person against whom the injunction measures have been taken.

• Payment for the services of the private enforcement agent in enforcement proceedings (1) on reimbursement of expenses incurred in the performance of enforcement actions and (2) on the approval of the amounts of payment for the services of the private enforcement agent - not charged. Such decisions are executed by the private enforcement agents that issued them, except in cases of termination of its services.

• A three-day deadline has been established for the private enforcement agents to provide the parties or their representatives with the opportunity to familiarize themselves with the materials of the enforcement proceedings, make extracts from them, make copies; as well as a five-day period for consideration of applications and petitions of the parties on issues of enforcement proceedings.

• The bailiff is obliged to make audio, photo, and video recording when executing enforcement documents related to eviction, moving in, demolition, and while making an inventory and seizure of property.

• A private enforcement agent is obliged to keep electronic enforcement proceedings and insert decisions, acts, protocols, and other documents.

• The amount of insurance for the private sector insurance business was revised. Earlier, the private enforcement agent did not have the right to perform enforcement actions if the amount to be collected exceeded the amount of his insurance. Now the private enforcement agent is not entitled to carry out its activities in the absence of a professional liability insurance contract, according to which the amount of insurance is at least 1000 MCI for the cities of republican significance and at least 500 MCI for other regions of the republic.

• The concept of “insured event” has been concretized, which is the fact of the insured's civil liability for compensation the damage caused to the property interests of third parties due to professional errors made by the insured person in the execution of enforcement documents. The professional errors of the private enforcement agents are:

1) Incorrect execution of proceeding’s documents;

2) Untimely cancellation of measures of compulsory execution after the execution of the enforcement order, payment for the services of the private enforcement agent and the costs of execution, resulting in harm to the debtor;

3) Failure to notify the person, against whom the enforcement actions are being carried out, about the consequences of the actions performed, which caused harm to such person;

4) Loss or damage to documents received by the policyholder (insured person) from the parties to the enforcement proceedings;

5) Unlawful disclosure of information constituting a commercial or other secret protected by law, which became known to him as a result of his activities.

• The insurance contract for professional liability of the private enforcement agents may also determine other actions that caused damage to the property interests of third parties in the course of the execution of enforcement documents by the insured person.

• If the amount of the damage caused exceeds the amount of the insurance payment under the professional liability insurance contract, the private bailiff is responsible for the damage caused by him personally with his property, including money.

• The fact of infliction of harm subject to compensation is established by agreement of the parties concerned, and in the event of a dispute - by the court.

• A private enforcement agent has the right to accept an enforcement document for execution by full repayment of the amount indicated in it, with a subsequent claim to the debtor to reimburse it, including payment for his services.

The execution of judicial acts that have entered into legal force is essential. It is the final and no less important stage of justice than the consideration of cases by the courts. Without proper execution of court decisions, protection or restoration of violated rights, observance of legal principles, and other objectives of justice are not possible.

We hope that the adopted amendments will help reduce the number of disputes related to the execution of judicial acts, contribute to a better performance by bailiffs of the functions assigned to them, and help the parties exercise their rights obligations in enforcement proceedings.