In brief
This summer Kazakhstan has passed the latest set of amendments1 to certain laws on netting for derivative contracts and other qualified financial contracts ("Netting Amendments"), including the following:
On 29 June 2021, the Court of Appeal of Brussels handed down a decision in proceedings between the Republic of Kazakhstan (“Kazakhstan”), the National Bank of Kazakhstan (“NBK”) and four creditors (the “Creditors”).
In 2013, the Creditors had obtained an arbitral award ordering Kazakhstan to pay an amount of USD 508 million as compensation for damages suffered by the Creditors due to a harassment campaign led by Kazakhstan.
3 August 2020 - This note discusses recent developments in Kazakhstan on the suspension of the initiation of bankruptcy proceedings. The proposed suspension was introduced to help businesses overcome the economic crisis caused by the COVID-19 outbreak and measures taken to slow it down. Our note is intended to be a helpful guide - it is not comprehensive and does not constitute legal advice.
The latest amendments to the Kazakhstan Rehabilitation and Bankruptcy Law were signed on April 2, 2019, and became effective from April 14. The amendments enhance the priority right of secured creditors through the acceptance of pledged assets in kind or the implementation of self-facilitated foreclosure over pledged assets. Notably, the law provides that pledged assets are carved out from bankruptcy estates.
Priority of Claims of Secured Creditors
To exercise a priority right, a secured creditor must comply with the following procedure:
On 10 January 2020, new amendments to the “Law on Rehabilitation Procedure and Bankruptcy” dated 7 March 2014 No. 176-V (the “Old Law”) and related legal acts came into effect by the Law dated 27 December 2019 No. 290-VI (the Old Law, as amended, theAmended Law). The new amendments aim to facilitate and expedite the process for unsuccessful businesses to be liquidated. The main features of the Amended Law are outlined below
Conclusion on financial stability by a temporary manager/administrator
Law No. 176-V "On Rehabilitation and Bankruptcy" came into effect on 25 March 2014.
The Law "On Rehabilitation and Bankruptcy" (Law) has replaced the Law “On Bankruptcy” dated 21 January 1997. The law applies to legal entities and individual entrepreneurs. As with its predecessor, the Law does not apply to state owned entities, pension funds, banks, and insurance companies (for which special provision is made in the relevant legislation).
As compared with the previous law, the Law focuses more on rehabilitation procedure.
The new law extends the grounds for shareholders’ liability and invalidation of transactions.
On 26 March 2014, the new Rehabilitation and Bankruptcy Law (the New Law) took effect in Kazakhstan. The New Law supersedes the Bankruptcy Law adopted in 1997 (the Old Law).
This is a summary of the principal new provisions of recently enacted insolvency legislation applicable to businesses other than banks, insurance companies, pension funds and certain other entities. This summary is not comprehensive and does not constitute legal advice. The reader should obtain separate legal advice with respect to the issues addressed herein.
The Law of the Republic of Kazakhstan No. 176-V “On Rehabilitation and Bankruptcy” dated 7 March 2014 (hereinafter the “Rehabilitation Law”) was amended as follows:
On 13 November 2015, the Law of the Republic of Kazakhstan “On Introduction of Amendments and Supplements to Certain Legislative Acts of the Republic of Kazakhstan on the Issues of Rehabilitation and Bankruptcy” (the “Law”) was signed and its provisions were put into effect on 29 November 2015.