DISPUTE SETTLEMENT

From 5 August 2011, Law of the Republic of Kazakhstan No. 401-IV On Mediation, signed on 28 January 2011, came into force.

The Law provides rules for resolving disputes with the aid of a mediator, an independent and impartial individual selected by agreement of disputants. Mediation may be used in disputes (conflicts) arising out of civil, labour, family and other legal matters and involving individuals and (or) legal entities, as well as in disputes (conflicts) considered in a judicial process concerning minor and medium-gravity crimes.

SPECIAL ECONOMIC ZONES

Law of the Republic of Kazakhstan No. 469-IV On Special Economic Zones in the Republic of Kazakhstan was signed on 21 July 2011 and came into force from 17 August 2011.

A special economic zone is a part of the territory of the Republic of Kazakhstan in which the companies enjoy favorable taxation, free customs area regime and simplified procedures for employment of foreign workforce. Such special legal regime is offered to those companies whose activities foster fast development of high-productivity and competitive industries, promote investments and transfer of new technologies, and create employment opportunities.

The Law provides regulation of establishment, functioning and operation of special economic zones and determines conditions and procedures for granting access to entrepreneurs and companies to such zones.

The Law repeals the previous Law On Special Economic Zones of 6 July 2007.

MIGRATION

Law of the Republic of Kazakhstan No. 477-IV On Human Migration was signed on 22 July 2011 and came into force from 17 August 2011 (except for certain provisions regarding internal migration, which will come into force from 1 January 2015).

The Law contains regulation of entering, stay and work of foreign citizens and stateless persons in the Republic of Kazakhstan as well as internal migration issues.

One of the new requirements is that foreigners intending to establish a legal entity in Kazakhstan or acquire a share in a Kazakhstan-based legal entity may do so only if they have 'visa for entering as a business-immigrant'. One of the conditions for obtaining that type of visa is to have experience of conducting business.

The Law repeals the previous Law On Human Migration of 13 December 1997.

OIL PRODUCTS

Law of the Republic of Kazakhstan No. 463-IV On State Regulation of Production and Trade of Certain Oil Products was signed on 20 July 2011 and came into force from 10 August 2011 (except for certain clauses which have later terms of entering into force).

The Law sets requirements to producers, wholesale and retail suppliers and subsoil users in the field of production and trade of petroleum, fuel oil, aviation and diesel fuel. According to the Law, in order to regulate production and trade of those types of oil products, the State shall endorse schedules for supplies of crude oil and (or) gas condensate by subsoil users to producers of oil products to satisfy internal needs of the Kazakhstani market, endorse plans for oil processing and supplies of oil products, carry out accreditation of suppliers of oil products, set forth conditions and limitations for wholesale and retail sale of oil products, adopt technical regulations in the field of production and trade of oil products, exercise state control in the field of production and trade of oil products, establish price ceilings for retail sale of oil products which are subject to state price regulation, among others. The Law provides detailed regulation for implementation of the above methods.

The Law repeals the previous Law On State Regulation of Production and Trade of Certain Oil Products of 7 April 2003.

TAX

The Code of the Republic of Kazakhstan On Taxes and Other Obligatory Payments to Budget (Tax Code) was amended by Law of the Republic of Kazakhstan No. 467-IV of 21 July 2011. The provisions of the Law have different terms of entering into force; some of them have a retroactive effect.

A significant part of the amendments concern taxation of incomes of non-resident legal entities from Kazakhstani sources. In particular, the Law amends criteria for determining a permanent establishment of a non-resident and specifies procedures for registration of a permanent establishment of a non-resident; amends a list of income types of non-residents from Kazakhstani sources; provides more detailed regulation of the procedure of reimbursement of income tax withheld in Kazakhstan. Some provisions on taxation of incomes of non-resident individuals were also changed.

In addition, tax administration rules related to application of double-tax treaties are improved.

The Law introduces a new additional condition under which taxpayers are allowed to reduce their taxable income by capital gain derived from sale of shares and participatory interests in a legal entity or consortium: a taxpayer must hold the shares or participatory interests for more than three years as of the date of their sale.

The Tax Code now contains a definition of interrelated parties (previously, the interrelationship of parties was determined according to criteria provided by transfer-pricing legislation).

The law provides more detailed regulation of the procedure for appointment of structural divisions of a resident legal entity as tax agents.

Some amendments concern rules of tax related to liquidation and reorganization of taxpayers.

LAND

The Land Code of the Republic of Kazakhstan, the Law of the Republic of Kazakhstan On Special Status of Almaty City, the Law of the Republic of Kazakhstan On Natural Territories Under Special Protection were amended by Law of the Republic of Kazakhstan No. 464-IV of 20 July 2011.

The amendments concern various aspects of land-related matters, including land zoning and legal regime of different land categories. 

TRADE AND CUSTOMS

Resolution of the Government of the Republic of Kazakhstan No. 1036 of 15 October 2005 were amended by Resolution of the Government of the Republic of Kazakhstan No. 503 of 12 May 2011.

Export customs duties on certain goods produced of oil have been increased.