Kazakhstan introduces an investment court

Parliament of Kazakhstan is currently considering a draft of the new Civil Procedure Code. Among major novelties is introduction of the Specialized Board for Settlement of Investment Disputes.

To ensure greater legal protection of investments the respective Special Boards of the Court of Astana and the Supreme Court (in case of investments for over USD 2 mln.) would be exclusive venues for investment disputes resolution.

In both cases, the decisions of the Special Boards can be appealed to the Oversight Board of the Supreme Court as per general court procedure.

Another novelty proposed by the draft is to expand the notion of “investment dispute”. The current investments law defines investment disputes as any dispute arising out of investment contract, whereas the parties are an investor and an authorized investments agency.

As per the draft an investment dispute would have a broader interpretation and would include not only disputes arising out of an investment contract, but also investors’ appeals of the actions and decisions of government agencies and officials. In other words, an investor would be entitled to appeal, among others the results of tax and customs inspections issued by government agencies in connection of investment activity to the Court of Astana or the Supreme Court. At the same time, the definition of investment disputes is not limited and includes any disputes arising out of investment activities undertaken by an investor.

Based on the foregoing, the proposed draft of the Civil Procedure Code brings a drastic change to court proceedings with participation of investors. In our opinion, it would lead to the better quality of justice administration, as well as reduced legal expenses and litigation timeline.

Information contained in this Client Update is of general nature and cannot be used as legal advice or recommendation. Please seek a lawyer for a specific advice. Please note that Kazakhstan is an emerging economy and its legislation and legal system are in constant development. Should you have any questions or would like to discuss matters addressed in this Client Update, please contact us.