Directors and officers of private companies are responsible for managing and running business. This responsibility is not limited to disciplinary liability (such as termination of employment), but also involves civil law liability (such as payment of damages) as well as administrative and even criminal liability. In some cases, the liability may be broad and contain no reasonable exceptions that might be available in other jurisdictions. This LawFlash summarizes the extent of liability that company directors and officers could face under Kazakhstan law.

Key changes proposed in the new Rehabilitation and Bankruptcy Law affect involuntary petitions for bankruptcy, invalidations, trustees' avoidance powers, debtors' dissolution, and priority of claims.

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 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.

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.