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Doing business in kz _Linkage and Mind

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Alida Tuyebekova, a senior lawyer of Linkage & Mind presented a report ‘On Legal Aspects of Doing Business in Kazakhstan’, for business delegation from Spain at the seminar organised by the Department of Economy and Trade of Spanish Embassy.

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Doing business in kz _Linkage and Mind

  1. 1. 1
  2. 2. About Us 2
  3. 3. 3 AboutUs Consistentlyawardedandrecognizedbyglobalratingagencies 20+clientsfromNationalBusinessList 75%ofourclientsareforeigncorporations PartnershipwithleadinglawfirmsfromtheEU,US,AsiaandCIS OfficesinAstana,Almaty&London FluentinEnglish,Kazakh,RussianandGerman Innovativesolutionstothemostcomplexbusinessandlegalissues
  4. 4. Awards 4 M&A -Law Firm of the Year in Kazakhstan, 2013 Tax -Law Firm of the Year in Kazakhstan,2012, 2013 Tax -Law Firm of the Year in Kazakhstan, 2013, 2014 European Women in Business Law-Law Firm of the Year in Kazakhstan, 2011, 2012, 2013 Public Private Partnerships -Law Firm of the Year in Kazakhstan, 2011 Corporate Tax Law -Law Firm of the Year in Kazakhstan, 2011 and 2012
  5. 5. HIGHLIGHTED ТRACK RECORD OF OUR SPANISH PROJECTS 5 2013 2012 Typsa Kazakhstan-Spanish Joint Venture«Tulpar-Talgo» Corporate and M&A Corporate and M&A, Tax & Investment privileges, Government Relations Construction & Infrastructure Industrial & Manufacturing Comprehensive support for the Spanish Enterprise in negotiations and entering into general agreement for contracting and engineering works on construction of LRT in Astana Comprehensive advice for JV TULPAR-TALGO on corporate, tax, contractual and customs issues in the project related to building of passenger cars
  6. 6. LegalAspects ofDoingBusinessinKazakhstan 6
  7. 7. General Overview 7
  8. 8. GENERAL OVERVIEW KazakhstanislocatedintheheartoftheEurasiancontinent. Territory–2.7millionsq.km. Population–17millionpeople Mainethnicgroups: Kazakhs:65% Russians:25% Other:10% Majorlanguages Kazakh(statelanguage) Russian(official,businesslanguage) English(businesslanguage) It is the CIS’ second and world’s ninth largest country. Kazakhstan borders with China, Kyrgyz Republic, Turkmenistan, Uzbekistan and Russian Federation. 8
  9. 9. Setting Up a Business 9
  10. 10. START UP A BUSINESS IN KAZAKHSTAN AsaruleforeigncompaniesstartuptheirbusinessinKazakhstanbyestablishingalegalpresenceinformofarepresentativeoffice(RO),branchoffice(BO)orasubsidiarycompany.ThedifferencebetweenarepresentativeofficeandabranchofficeliesinthescopeofbusinessactivitiesthattheycancarryoutundertheRKlaws. 10 SCOPE OF BUSINESS ACTIVITIES REPRESENTATIVE OFFICE (RO) BRANCH OFFICE (BO) SUBSIDIARY COMPANY Representation and protection of interests of a mother company, no business activity is permitted All or part of types of business activities on behalf of and in the name of the head company Any types of permitted business activities on behalf of its name
  11. 11. RO v. BO BothROandBOareconsideredtobestructuralsubdivisionsofalegalentity(company)andshallnotacquirerightsandobligationsofalegalentity. Unlikealegalentity,ROandBO: Carryoutactivityonbehalfandinthenameoftheheadcompany; DonothaveanyseparateassetsotherthanassetsprovidedtoaBObytheheadcompany; Donothavefullandsoleliabilityforviolationofobligations. TheheadcompanyvestsassetsandpropertyinitsBOorROinKazakhstan,thusbothROandBOdonotownanyassets.Allassetsofastructuralsubdivisionareownedbytheheadcompany.BothROandBOcarryoutactivityonbehalfofandinthenameoftheheadcompanyandcanhirepersonnel,openbankaccounts,leaseofficesandpaytaxes. 11
  12. 12. BRANCH v. SUBSIDIARY Adifferencebetweenabranchandasubsidiaryisinthelegalstatus(i.e.structuralsubdivisionandlegalentity). Alegalentityisliableforitsobligationstothefullextentofitspropertyandassetswhichitowns(includingtherightsofpossession,useanddisposalof),economicjurisdictionoroperationmanagement(possessionanduse). Alegalentitycanacquireandexerciseproprietaryandnon-proprietaryrights,beaclaimantandplaintiffincourts.Alegalentityshallhaveautonomousbalancesheetandbudget. AsubsidiarycanbeestablishedinanyofthelegalformsasstipulatedbytheCivilCode,howeverthemostpopularandcommonlyusedlegalformsareJOINTSTOCKCOMPANY(JSC)andLIMITEDLIABILITYPARTNERSHIP(LLP),thelatterismoresimpleform,therebymoreused. 12
  13. 13. JOINT-STOCK COMPANY AJSCissuessharesandraisesfundsforcarryingitsactivity.Itcanbefoundedbyoneorseverallegalentitiesandindividuals.JSCfoundershavejointliabilityonexpensesandcostsassociatedwiththefoundationofJSCpriortoitsstateregistration. TheconstitutivemaindocumentofaJSCisArticlesofAssociation AJSC’supremebodyistheGeneralMeetingofShareholdersorsoleshareholder. Someorganizationssuchasbanks,pensionfunds,investmentfundsmustbecreatedonlyintheformofaJSC. AchartercapitalofaJSC,exceptforinvestmentprivatizationfund,shouldbenotlessthan50000foldofMAI. MAI(MONTHLYASSESSMENTINDEXisKZT1852(approximatelyEUR8)asof01January2014. TheminimumamountisKZT92600000ornearlyUSD508792.Bankingregulationstipulatesfordifferentamountsforcharterandnetworthorshareholders’stock. 13
  14. 14. JOINT-STOCK COMPANY Specificrequirements: CompulsoryagreementwiththeINTEGRATEDSECURITIESREGISTRARwhichmaintainsashareregisterpriortoregistrationofsecuritiesemission; Placementofsharesafterregistration; FilingreportsonplacementsofshareswiththeNationalBankofKazakhstan; Placementofconsolidated(incaseofexistenceofBOandRO)ornon- consolidatedfinancialstatementsinnewspapers. AJSCshouldsubmitafullbundleofdocumentsrequiredforstateregistrationofdeclaredshareswithin30(thirty)calendardaysfromthedateofitsstateregistration. Ingeneral,aregistrationofaJSC,excludingregistrationofshares,takes5-11workingdays. 14
  15. 15. LIMITED LIABILITY PARTNERSHIP AnLLPcanbeestablishedbyoneorseveralindividualsand/orlegalentities(alsoknownasLLPParticipants).Atthesametime,thepartnershipconsistingofoneparticipantcannotbeasoleparticipantinanotherLLP. ParticipantsarenotliablefortheirobligationsandbeartheriskoflossassociatedwiththeactivitiesoftheLLPtotheextentoftheirparticipatoryinterest. AnLLPisestablishedwiththechartercapitaldividedintoshares(alsoknownasParticipatoryInterest)theamountofwhichisdeterminedandsetoutintheconstituentdocuments(ArticlesofAssociationandFoundationAgreement). AminimumchartercapitalmustbenolessthanKZT100forasmall-scaleLLPandKZT185200ornearlyUSD1000formediumandlarge-scaleLLP(100-foldofMAI). StateregistrationofanLLPtakes1-3workingdays. 15
  16. 16. LIMITED LIABILITY PARTNERSHIP Theparticipant(s)shallapprovethecharterofLLP,adocumentthatdefinesthelegalstatusofthepartnershipasalegalentity.FormationofanLLPrequires: FoundationAgreement(MemorandumofAssociation) Charter(ArticlesofAssociation) TheGeneralDirector(CEO)ofanLLPmusthaveaworkpermit AsforthehiringcitizensofmemberstatesoftheCustomsUnion(RussiaandBelarus),aswellasforforeigncitizensholdingapermanentresidencepermitintheRepublicofKazakhstan,obtainingofsuchworkpermitisnotrequired. 16
  17. 17. SCALE OF BUSINESS Allprivatebusinessescanbedividedintosmall,mediumandlargescalebusinessbasedonthecriterionofaverageannualnumberofemployeesandannualaverageincome. 17 SMALL MEDIUM LARGE CRITERION SOLEPROPRIETOR ORLEGAL ENTITY ANNUAL AVERAGENUMBER OF EMPLOYEES NO MORE THAN 50 (FIFTY)EMPLOYEES MORE THAN 50 (FIFTY) AND UP TO 250 (TWO HUNDRED FIFTY) EMPLOYEES MORETHAN 250 (TWO HUNDRED FIFTY) EMPLOYEES AND AND AND (OR) ANNUAL AVERAGE INCOME UP TO EUR 465 000 FROM EUR 465 000 TO EUR 23 MLN FROM EUR 23 MLN AND MORE
  18. 18. LEGAL REGIMEBRANCH & SUBSIDIARY 18 Criteria Branch Office LLP Charter capital No Mediumand large scale business –USD 1 000 Small scale business –KZT 100 (EUR 0.4) Confirmation fromthe tax authorities on absence of outstanding debts to the state budget at the head company (during state registration, re-registration due to change of participants) No Required Tax registrationof Director (CEO) Required Required
  19. 19. LEGAL REGIMEBRANCH & SUBSIDIARY 19 Criteria Branch LLP Documents confirming location of an entity (lease agreement, sale-purchase agreement) Required Physical presence of CEO in Kazakhstan for signing tax declarations and financial statements Required Registration in local area, where business is carried out Required Tax residence (for tax purposes) Permanent establishment of a non-resident Resident
  20. 20. LEGAL REGIMEBRANCH & SUBSIDIARY 20 Criteria Branch LLP Localcontent requirement (for subsoil use contracts –content of local personnel, works and services are established) Minimum Extensive Foundationof another legal entities No, thefounder will be a mother company Shareholder of participant will be an LLP.An LLP with a sole participant cannot create another LLP Licensing Required for certain types of businessactivities Corporate Income Tax 20% VAT 12%
  21. 21. LEGAL REGIMEBRANCH & SUBSIDIARY 21 Criteria Branch LLP Property tax From0,1 up to 1,5% Social tax 11% Netrevenue tax (revenue less corporate income tax) 15% None Repatriationof incomes Netrevenue can be repatriated with no need to pay any additional taxes and to comply with the currency control Transferof net profit in form of a dividend to participants will be levied with withholding tax at rate of 15%. If it is transferred in form of a fee for some services on the basis of contract, it will be subject currency control, transfer pricing, withholding tax at 15%and VAT at 12%
  22. 22. LEGAL REGIMEBRANCH & SUBSIDIARY 22 Criteria Branch LLP Work permit Mustbe obtained for all foreigners in personnel except for CEO or Director Must be obtainedfor any foreigners, including management staff and CEO Engagementof accounting firm or hire an accountant for keeping and filing tax returns, declaration, statements and etc. Stronglyrecommended Currency control EitherKZT or any other foreign currency can be used on the territory of the RK Can work with residentsonly with KZT, some transactions with foreign currency are subject to currency control
  23. 23. 23 Work Permits
  24. 24. WORK PERMITS Employingaforeigncitizen: Annualquoteforforeignemployees,setbythelegislation; Ageofanattractedemployee(notyounger23andolder63formenand58forwomen); Requiredproportionalratioofforeignemployeesinrelationtolocalstaff,forexamplenomorethan30%offoreignersinthemanagementstaff; RegionofKazakhstan; Personalcharacteristicsofaforeignemployee; Plansontraining,replacementandattractionoflocals; Jobpositions. 24
  25. 25. WORK PERMITS AforeigncitizenwhoisbeingemployedbyaKazakhstaniemployershouldgetaworkpermitofacertaincategory.ThetablebelowshowstheexistingcategoriesofworkpermitsinKazakhstan. UNIFIEDRATINGANDSKILLSGUIDEforjobsandoccupationsofworkerssetsoutandspecifiesqualificationrequirementsforforeigncitizensthatarebeingattractedforII-IVcategories. 25 I II III IV Chief Executive, Top Managers (head) and Deputies Directors of structural units (departments, offices) Experts, managers, specialists and other employees Workers
  26. 26. WORK PERMITS Thereisnoneedtoobtainaworkpermit,ifaforeigncitizenisattractedforthefollowingjobpositions,butnotlimitedtothis: Head(Director)ofBOorRO; CEOofcompanies,whichsignedinvestmentagreementswiththeKazakhstanigovernmentforUSD50000000; CEOofcompanieswhicharecarryingoutbusinessactivityinpriorityeconomicsectoraspertheLawonInvestmentsand,accordinglysignedinvestmentagreement; Shipandrivercraftcrew,balletdancers,professionalentertainersandetc. Thegovernmentannuallyestablishesquoteforworkpermitsissuancetoforeigners.In2014quoteequalsto0,7%toeconomicallyactivepopulation.Employersshallrequestquotesforworkpermitsforthenextyearbeforethis1stdayofSeptember. 26
  27. 27. Currency Control 27
  28. 28. CURRENCY CONTROL NationalBankoftheRepublicofKazakhstanisthemainstateagencyoncurrencycontrol. Inordertogatherstatisticaldataaboutcapitalmovementoperations(financialloans,foreigndirectinvestments,commercialcredits,foreignbankaccounts)theLawonCurrencyregulationandcontrolprovidesforregimesofregistrationandnotification. Registrationandnotificationregimescoveronlylargecapitalmovementoperationswhichassumecapital(goods,money)inflowexceedinganequivalentofUSD500000,andcapital(goods,money)outflowexceedingUSD100000. RegistrationregimereckonsforprovidingtheNationalBankofKazakhstanwithacopyofadocument(contract)onthebasisand(or)inpursuanceofwhichcapitalmovementoperationsarecarriedoutbeforetheconductionofsuchoperation,whilenotificationregimecallsforprovidinginformationaboutcapitalmovementoperation(includingacopyofacontract)aftertheoperationwasconducted. RegistrationandnotificationregimesspreadonlyonresidentsofKazakhstan. 28
  29. 29. Construction 29
  30. 30. CONSTRUCTION Thelegalframeworkofconstructionactivitydoesnotcontainaspecificlawonconstructionandtechnicalregulationonconstructiononly,insteadthereisaLAWONARCHITECTURAL,TOWN-PLANNINGANDCONSTRUCTIONACTIVITIESwhichisthecentralandmainlegalactregulatingconstructionactivities.Thislawprovidesfordefinitionsofeachofthesebusinessactivities. Ifacompanyoranindividualdecidestocarryoutoneoftheseactivities,theyshouldgetaspecialpermitfromtherelevantstateagency,whichiscommonlycalledinKazakhstanasthe“ConstructionLicense”(the“ConstructionLicense”). Thesethreebusinessareas–architecturalactivity,town-planningandconstrictionaresubjecttolicensingandcannotbecarriedoutwithoutalicense. 30
  31. 31. CONSTRUCTION LICENSE 31 I CATEGORY IICATEGORY III CATEGORY FACILIITIES:Technicalandproductionfacilities; FACILITIES:Technicalandproductionfacilities, laboursafetyrules; FACILITIES:Technicalandproductionfacilities, laboursafetyrules; STAFF:similartocriterionofIIcategoryandnotlessthan20%ofengineeringstaffmustbepermanentemployeesanddonotcombinejobsORNOTREQUIREDFORANAPPLICANTFOUNDEDBYACOMPANYWITH30YEARSOFINTERNATIONALEXPERIENCE; STAFF:notlessthanoneengineeringstaffworkerdulyqualifiedandexperienced(5years–highereducationand7years–mediumeducation)andadmissiontorworksinzonesofhighseismichazard; STAFF:notlessthanoneengineeringstaffworkerdulyqualifiedandexperienced(3years–highereducationand5years–mediumeducation)andadmissiontorworksinzonesofhighseismichazard,and APPLICANT”SEXPERIENCE:notlessthan10(ten) yearsofexperiencefromthedayofobtainingalicenseorsimilarforeignpermissivedocumentorfiveyearsofexperienceasaIIcategorylicenseholder, FORANAPPLICANTFOUNDEDBYACOMPANYWITH30YEARSOFINTERNATIONALEXPERIENCE-6(six)years; APPLICANT”SEXPERIENCE:notlessthan5(five) yearsofexperiencefromthedayofobtainingalicenseorsimilarforeignpermissivedocumentorfiveyearsofexperienceasaIIIcategorylicenseholder; APPLICANT”SEXPERIENCE:NOTREQUIRED. COMPLETEDPROJECTS–notlessthan10ofIIandIIIlevelofcomplexityasageneralcontractorandnotlessthan20ofIandIIlevelofcomplexityassubcontractor;NOTREQUIREDFORANAPPLICANTFOUNDEDBYACOMPANYWITH30YEARSOFINTERNATIONALEXPERIENCE COMPLETEDPROJECTS–notlessthanfiveofIIandIIIlevelofcomplexityasageneralcontractorandnotlessthan10ofIandIIlevelofcomplexityassubcontractor;and CLIENTREFERENCES-notlessthanfivereceivedasageneralcontractorortenasasubcontractor NOTREQUIREDFORANAPPLICANTFOUNDEDBYACOMPANYWITH30YEARSOFINTERNATIONALEXPERIENCE CLIENTSGOODREFERENCES-notlessthanfiveasageneralcontractorortenassubcontractor
  32. 32. CONSTRUCTION ForeigncompaniescannotgetalicenseinKazakhstanwithoutlegalrepresentationhere,i.e.branchofficeoralimitedliabilitypartnership(LLP). BasedonreviewofqualificationrequirementsforgettingtheConstructionLicenseandourexperience,includingdealingwiththecompetentstateagency,WEADVISEFOREIGNCOMPANIESTOSETUPABRANCHINORDERTOGETTHECONSTRUCTIONLICENSE,asanewlysetupcompanycannotgettheConstructionLicenseofIcategoryandiseligibleonlyforIIIcategorylicense,whilstabranchofaforeigncompanywithlongandextensiveexperiencecangettheConstructionLicenseofIcategory. TheConstructionLicenseisissuedwiththeattachment“SpecificConditions”,inwhichthecompetentstateagencywritesthecategoryandsetsoutspecificconditions. Theauthorisedstateagencyforarchitectural,town-planningandconstructionactivitiesisCOMMITTEEONCONSTRUCTIONANDHOUSINGANDUTILITIESINFRASTRUCTUREINTHEMINISTRYOFNATIONALECONOMYOFTHEREPUBLICOFKAZAKHSTAN. 32
  33. 33. CONSTRUCTION MATERIALS Constructionmaterialsandproductsusedforconstructionofbuildings,erectionsaswellasforpersonalanddailyneedsofpeopleduringdifferentconstructionandrepairworks,canbebroughttotheKazakhstanimarketonlyiftheyconformtostandardsofTechnicalRegulations.«SAFETYREQUIREMENTSTOERECTIONS, BUILDINGS,CONSTRUCTIONMATERIALSANDPRODUCTS”andidentified. AconstructionproductisbeingidentifiedwithcodeofCOMMONCUSTOMSTARIFFoftheCustomsUnionandrelevantcodeofNATIONALCLASSIFICATORYOFECONOMICACTIVITIESonthebasisofmarking,submitteddocuments,indicatorsandothercharacteristics,sufficientforidentification. 33
  34. 34. CONSTRUCTION Constructionmaterialsandproducts,includingimportedones,mustbeprovidedwithtechnicaldocumentationforcustomersthatisinstructionsforusage,qualitycertificate,conformancecertificate,compliancedeclarationandothertechnicaldocuments,necessaryforevaluationofpossibleconstructionrisks. Executivepersonnel,responsibleforconstructionofbuildingmustensureavailabilityofCertificateofConformanceorComplianceDeclaration(dependingonkindofmaterial)forconstructionmaterialsusedduringtheprocess. Theconformityassessmentisbeingdonebythe: 1)conformityagencybywayofassessmentandissuanceofconformityassessment; 2)consumerofconstructionproductsbywayofassessmentbyaconformityagency; 3)producer(executor)ofaconstructionproductsbywayofissuanceofconformancedeclaration. Conformityassessmentiscompulsoryandvoluntarydependingonthenatureofconstructionproducts. 34
  35. 35. 35 Legal Tips
  36. 36. LEGAL TIPS PriortostartbusinessactivityinKazakhstanitisadvisabletonotethefollowing: ALLPisthemostpopularandcommonlyusedlegalformofacompany; AnysettlementbetweenresidentsshouldbemadeinnationalcurrencyTENGE, whilstsettlementsbetweennon-residentsincludingBOandROofforeigncompaniescanbemadeinanycurrency; Obtainingaworkpermitisasophisticatedprocess,howevertherearecertainexceptions; Transferofmoneyintochartercapitalofalocalcompanyinparticipatoryinterestshallbeconsidereddirectinvestmentsandsubjecttocurrencycontrol; Morethantwenty(20)businessactivitiesaresubjecttolicensingandcannotbecarriedourwithoutalicense. 36
  37. 37. LEGAL TIPS Kazakhstanisamemberofmorethanfortyconventionsonavoidanceofdoubletaxationandpriortosettleanytaxpaymentoneshouldcheckwhetherthetaxcanbeavoidedunderaconvention; CEOofBOandROdonotneedtoobtainaworkpermit; PriortopurchasingparticipatoryinterestinanLLPoraJSC,capitalgaintaxmustbechecked; RKLawsestablishextensiveincentivesforcertaininvestors,settingoutpriorityeconomicsectorsforinvestmentsandcurrentlythereareseveralSPECIALECONOMICZONESontheterritoryofKazakhstan,whereinvestorscanworkunderspecialtaxregime. Asoftodaythereareten(10)specialeconomiczones–areaswithintheterritoryofKazakhstanwithneatly-definedborderswithspeciallegalregime(taxandcustoms). 37
  38. 38. Investing in Kazakhstan 38
  39. 39. SECTOR-SPECIFIC INCENTIVES IN 10 DEDICATED SEZs ACROSS THE COUNTRY •SLIDE TEXT “NATIONAL EXPORT AND INVESTMENT AGENCY “KAZNEX INVEST” JSC | Ministry of Industry and New Technologies of the Republic of Kazakhstan SEZ “Petrochemical park” (Oil and gas industry, petrochemicals) SEZ“Burabai” (Tourism) SEZ“Astana new city” (construction industry) SEZ“Pavlodar” (chemical industry) SEZ “Saryarka” (metallurgy) SEZ “Khorgos Eastern Gate” (Trade, logistics) SEZ “Innovation TechnoPark” (IT-industry, innovations) SEZ “Chemicalpark Taraz” (chemical) SEZ“Ontystik” (textile industry) SEZ “Marine Port Aktau” (logistics, transport) Aktau Atyrau Astana Pavlodar Karaganda Shymkent Taraz Almaty
  40. 40. FOREIGN INVESTMENT FISCAL INCENTIVES in SEZs 0%CorporateIncomeTaxuntil2020-2025withpossibilityforextension 0%forlandandpropertytaxuntil2020-2025withpossibilityforextension VAT–0%(forproductsconsumedinSEZ)until2020-2025withpossibilityforextension Increaseofmarginalrateofdepreciationfortaxontheproductionofsoftwareto40% ForSEZ“Innovationtechnopark”–socialtaxis0%for5years,undercertainconditions ForSEZ“Innovationtechnopark”–depreciationrateforsoftwareincreasedto40% NON-FISCAL INCENTIVES ProvisionoffreelandinSEZforaperiodofupto10yearsfromregistrationtimeasSEZresident Simplifiedprocedurefortherecruitmentofforeignlabour 40
  41. 41. FOREIGN INVESTMENT TherearesomeadditionaltaxbenefitsforSEZ“InnovationTechnologyPark”participants: Conditionsfortaxbenefits: registrationasataxpayerwithinSEZterritory; registrationasaSEZparticipant; absenceofstructuralsubdivisionsoutsidetheSEZ; incomefromthesaleofown-producedgoodsbythepriorityactivitiesofSEZshallbeatleast90percentofthetotalannualincome(forSEZ"ITP"-70%). 41
  42. 42. FOREIGN INVESTMENT CUSTOMS PRIVILEGES ForgoodsIMPORTEDintoSEZterritory Exemptionfromcustomsduties ForgoodsEXPORTEDfromSEZterritory* CUcommoditiesexportedfromtheSEZtotherestterritoryoftheCustomsUnion,arenotsubjecttocustomsduties. CUcommoditiesexportedfromtheSEZterritorytooutsidetheCustomsUnion,aresubjecttothepaymentofexportcustomsduties. ForeigncommoditieswithnostatusasCUgoods(simpleassembly)exportedfromtheSEZtotherestterritoryofCustomsUnion,aresubjecttothepaymentofcustomsduties. InthecaseofforeigncommoditieswhicharenotusedandnotprocessedwithinSEZterritory,atexport(tothethirdcountries),thecommoditiesareexemptedfrom"re-export"customsduties,. InacaseofforeigncommoditiesprocessedwithinSEZterritory,atexport,,exportdutiesshallbepaidaccordingtotheregulation#520oftheGovernmentoftheRepublicofKazakhstandated07June2010. MoredetailedinformationconcerningcustomsbenefitsarereflectedintheAgreementonthefree(special) economiczonesinthecustomsterritoryofthecustomsunionandthecustomsprocedureofcustoms-freezone(St.Petersburg,June18,2010). •**ThesebenefitsareapplicablebyJanuary1,2017onlyforparticipantsregisteredbeforeJanuary1,2012 42
  43. 43. FOREIGN INVESTMENT 43 Political Stability and GoodInvestment Climate Regionally Attractive Fiscal and Non-fiscal Regime and Protection of ForeignInvestment Ahighleveloftrustinpoliticalinstitutionsandtheeffectiveallocationoffunds(WEF2012)incomparisonwiththecountriesoftheCIS Attractivecorporatetaxrate(20%)LowVAT(12%) Fiscalandnon-fiscalincentivesforinvestors, includinginSEZs 48BilateralAgreementsonmutualprotectionofinvestments(USalso) Maininternationalarbitrationinstrumentsratified Stable Macroeconomic Indicators and High Growth Spring Board to Circa 3 Billion Potential Customers GDPgrowth:5.5%(IMF2012) LowDebt/GDPRatio:15.8%(IMF2012) BudgetDeficit:2.5%(IMF2012) InflationRate:6.0%(IMF2012) 3ofthe5BRICSCountriesarein4hoursflight CustomsUnion(Kazakhstan,Russia,Belarus)withpopulationof170million totalGDPof2trillion Openeconomy(trade70%ofGDP)EntryintotheWTOisexpectedin2014-2015
  44. 44. Thank You 44 WE WOULD BE HAPPYTO HELP WITH LEGAL ADVICE AND DISCUSS ANY OF THE RAISED ISSUES…
  45. 45. 45 Astana Almaty London 7 Imanov St, #21Astana Kazakhstan 010000 T+ 7 7172 200701info@linkagemind.com 180 Dostyk ave, 6th floorKoktem B/C Almaty, Kazakhstan 050000 T+ 7 7172 200701info@linkagemind.com London, UK T+ 44 79 5183 4638info@linkagemind.com
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