Our M&A team in Kazakhstan discusses June highlights on key legal developments in energy, competition and subsurface use.
I. Legislative news
- The Government of Kazakhstan has determined the conditions and procedure for the designation of a state enterprise as a JSC and LLP as subject to a special right. It should be recalled that the term “special right” as a new regime of monopoly position has been incorporated into legislation quite recently and refers to an exclusive or preferential right of a market entity to produce, sell and/or buy n any good in a competitive market. market.
- The Competition Authority has approved rules aimed at providing market entities with equal access to the key capacity of a dominant or monopolistic entity in a specific commodity market. Please note that the concept of “key capability” appeared in legislation in January this year and refers to goods, works and services of a dominant or monopolistic entity without access to which other market participants cannot produce and/or or sell goods on the market.
Subsoil Use / Petrochemicals
- The Ministry of Industry and Infrastructure Development has approved new wording for license forms for the following types of subsurface use operations:
- Geological study of the basement
- Exploration of solid minerals
- Extraction of solid minerals
- Extraction of common minerals
- Use of basement space
- The National Security Committee, together with a number of ministries, introduced a six-month ban (from July 12, 2022) on the export from the territory of the Republic of Kazakhstan (except for the export in gas tanks supplied by automobile manufacturers and in individual containers of not more than 20 litres), gasoline, diesel fuel and certain petrochemical products, except motor vehicle machine oils.
Gas and gas supply
- The Ministry of Energy has approved the maximum price of liquefied petroleum gas tradable on the domestic market of the Republic of Kazakhstan outside the commodity exchange. The maximum price will be set at 33,600 KZT per tonne (excluding VAT) for the period from July 1, 2022 to June 30, 2023.
Public Private Partnership (PPP)
- The Ministry of National Economy has established the limits of state obligations for PPP and concession projects. These monetary limits have been approved for each region for the period from 2022 to 2024.
- The government has introduced a new term, “a single pool of investment projects”, in the regulation of investment activities. This is a list of investment projects (formed by the Investment Committee of the Ministry of Foreign Affairs) in the non-primary sectors of the economy worth more than KZT 500,000,000, initiated by investors nationals and foreigners. In addition, it has created a structural unit working group on the basis of the national company KAZAKH INVEST JSC, which will be mainly responsible for (a) the formation and maintenance of a single pool of investment projects and ( b) the provision of services to investors who have a stop principle and implement projects with an investment volume of 7,500,000 MCI or more in all sectors of the economy.
- The Ministry of Agriculture has approved a new formulation of the rules for organizing and conducting tenders for the sale of state land or land rental rights on the web portal of the Public Property Registry https:// e-qazyna.kz/.
The Ministry of Energy has approved a new formulation of the maximum tariffs for electricity sold by electricity production organizations until the year 2025 inclusive. These maximum rates are established for groups of power generating organizations.
The Senate of Parliament has approved passage of legislation to improve legislation on electricity, energy conservation, subsurface use, local governments and the state border (see the May 2022 summary for more details). This will come into effect on August 31, 2022.
- The Senate of Parliament is considering a bill amending a number of legislative acts on the development of digitalization and innovation in business processes and in the work of public authorities. This bill contains a significant number of innovations and proposes, among other things, the following:
Law on State Registration of Legal Entities and Registration of Branches and Representative Offices
It is proposed to complete: (a) state registration of legal persons (including if a legal person is created as a result of reorganization); (b) accounting registration of a branch (representative office) of a legal entity; (c) State re-registration of a legal entity; and (d) state registration of the termination of a legal entity electronically based on an electronic request submitted through the “e-government” web portal.
Section 18-1. It is proposed to implement new postal services, such as e-mail and hybrid services. The purpose is the electronic transmission of messages, information, letters and documents between authenticated service users with confirmation of the sending and delivery of this transmission and the guarantee of secure storage of messages, information, letters and documents received. User authentication will be carried out by means of an electronic digital signature.
Authorizations and Notifications Act
Section 7. It is proposed to allow (a) the verification of the applicant’s compliance with qualification or license requirements and (b) the automatic issuance of a license in the State information system. This implies a regime in which the examination of the application and the issuance of the permit take place without the intervention of the head of the licensing authority.
The Majilis of Parliament is considering a law on the ratification of the agreement between the governments of the Republic of Kazakhstan and the United Arab Emirates on the promotion and mutual protection of investments, signed in Abu Dhabi on March 24, 2018.
II. Clarifications from state authorities
- Response from the Minister of Labor and Social Protection of the Population dated June 15, 2022: “If the employer has more than one reason for terminating the employment contract, the choice of reason is the prerogative of the employer.”
- Response from the Minister of Energy dated June 24, 2022: “The wholesale sale of liquefied petroleum gas by the filling station owner to another filling station owner is not permitted.”
III. Scientific publications
Zakon.kz / Analytics
- Suleimenov MK, Professor, Member of the National Academy of Sciences of the Republic of Kazakhstan, Amendments to the Constitution: Pros and Cons
- Klimkin SI, Doctor of Laws, Chief Researcher of the Institute of Legislation and Legal Information of the Republic of Kazakhstan, Analysis of some provisions of the Law of the Republic of Kazakhstan No. 2255 “On Business Partnerships” May 2, 1995
- Nesterova YV, Doctor of Laws, Chief Researcher of the Institute of Legislation and Legal Information of the Republic of Kazakhstan, The problem of the arbitration agreement in disputes involving consumers
- Shakirova AA, Judge at the Specialized Interdistrict Administrative Court of the Karaganda region, Litigation of public services
- Zhadauova Z., Chief Researcher of the Department of Analysis of the Effectiveness of Legislation of the Institute of Legislation and Legal Information of the Republic of Kazakhstan, On the analysis of the stability (instability) of the law of the Republic of Kazakhstan No. 379-V ЗРК “On Public-Private Partnership” of October 31, 2015
- Akhmetova AY, Deputy Minister of Justice of the Republic of Kazakhstan, On improving copyright legislation
Click here to download Kazakhstan Law News Digest June 2022 (Russian)