Civil Code of the RK (General Part)

Official source: Adilet / https://adilet.zan.kz/rus/docs/K940001000_ The relevance of the editorial office has been verified: 2026-06-21.

RCPI note! Put into effect by Resolution of the Supreme Council of the Republic of Kazakhstan dated December 27, 1994 No. 269-XIII

Note FROM! Contents have been created for ease of use.

CONTENTS

Footnote. The table of contents is excluded by the Law of the Republic of Kazakhstan dated July 12, 2022 No. 138-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication). In the text, after the word “Section”, the numbers “I - III” are replaced, respectively, by the numbers “1 - 3” in accordance with the Law of the Republic of Kazakhstan dated December 20, 2004 No. 13 (to come into effect from January 1, 2005).

GENERAL PART

Section 1. General provisions

Chapter 1. Regulation of civil law relations

Article 1. Relations regulated by civil law

1. Civil legislation regulates commodity-money and other property relations based on equality of participants, as well as personal non-property relations associated with property. Participants in relations regulated by civil law are citizens, legal entities, the state, as well as administrative-territorial units.

2. Personal non-property relations not related to property ones are regulated by civil legislation, since otherwise is not provided for by legislative acts or does not follow from the essence of the personal non-property relationship.

3. Civil legislation is applied to family, labor relations and relations on the use of natural resources and environmental protection that meet the criteria specified in paragraph 1 of this article in cases where these relations are not regulated accordingly by family, labor legislation, legislation on the use of natural resources and environmental protection.

4. Civil legislation does not apply to property relations based on administrative or other power subordination of one party to the other, including tax and other budgetary relations, except in cases provided for by legislative acts.

Article 2. Basic principles of civil legislation

1. Civil legislation is based on the recognition of the equality of participants in the relations regulated by it, the inviolability of property, freedom of contract, the inadmissibility of arbitrary interference by anyone in private affairs, the need for the unhindered exercise of civil rights, ensuring the restoration of violated rights, and their judicial protection.

2. Citizens and legal entities acquire and exercise their civil rights, and also renounce their rights, unless otherwise established by legislative acts, of their own will and in their own interest. They are free to establish their rights and obligations on the basis of the contract and to determine any of its conditions that do not contradict the law.

3. Goods, services and money move freely and circulate throughout the territory of the Republic of Kazakhstan. Restrictions on the movement of goods and services are introduced in accordance with legislative acts if this is necessary to ensure safety, protect human life and health, protect nature and cultural values.

Footnote. Article 2 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated March 25, 2011 No. 421-IV (shall be enforced ten calendar days after its first official publication).

Article 3. Civil legislation of the Republic of Kazakhstan

1. The civil legislation of the Republic of Kazakhstan is based on the Constitution of the Republic of Kazakhstan and consists of this Code, other laws of the Republic of Kazakhstan adopted in accordance with it, decrees of the President of the Republic of Kazakhstan having the force of law, resolutions of Parliament, resolutions of the Senate and the Mazhilis of Parliament (legislative acts), as well as decrees of the President of the Republic of Kazakhstan, decrees of the Government of the Republic of Kazakhstan regulating the relations specified in paragraphs 1, 2 of Article 1 of this Code.

2. In the event of a conflict between the rules of civil law contained in acts of legislation of the Republic of Kazakhstan, except for those specified in paragraph 3 of Article 1 of this Code, the provisions of this Code shall apply. Civil law norms contained in the legislation of the Republic of Kazakhstan and contradicting the norms of this Code can be applied only after appropriate amendments are made to the Code.

The norms of civil legislation of the Republic of Kazakhstan cannot contradict the basic principles of civil legislation of the Republic of Kazakhstan.

3. Relations related to the creation, reorganization, bankruptcy and liquidation of banks and grain-receiving enterprises, control over banking activities and its audit, control over the activities of grain-receiving enterprises, licensing of banking activities, regulation of banks, the onset of consequences of deprivation of a banking license, carrying out transactions with warehouse receipts of grain-receiving enterprises, are regulated by this Code insofar as they do not contradict legislative acts regulating banking activities and activities grain receiving enterprises.

Relations between banks and their clients, as well as relations between clients through banks, are regulated by civil law in the manner established by paragraph 2 of this article.

4. Civil relations may be regulated by customs, including customs of business, if they do not contradict the civil legislation in force on the territory of the Republic of Kazakhstan.

5. Ministries and other central executive bodies, local representative and executive bodies may issue acts regulating civil relations in the cases and within the limits provided for by this Code and other acts of civil legislation.

6. The rights of citizens and legal entities established by this Code and other legislative acts of the Republic of Kazakhstan cannot be limited by acts of government bodies and local representative and executive bodies. Such acts are invalid from the moment of their adoption and should not be applied.

7. Foreign individuals and legal entities, as well as stateless persons, have the right to acquire the same rights and are obliged to perform the same duties as provided for by civil legislation for citizens and legal entities of the Republic of Kazakhstan, unless legislative acts provide otherwise.

8. If an international treaty ratified by the Republic of Kazakhstan establishes rules other than those contained in the civil legislation of the Republic of Kazakhstan, the rules of the said treaty apply. International treaties ratified by the Republic of Kazakhstan are directly applied to civil relations except in cases where it follows from the international treaty that its application requires the publication of a law.

Footnote. Article 3 as amended by the Decree of the President of the Republic of Kazakhstan, having the force of Law, No. 2447 dated 08.31.95; laws of the Republic of Kazakhstan dated 02.03.1998 No. 211; dated January 15, 2001 No. 141; dated 04/29/2009 № 154-IV (for the order of enforcement, see st. 2); dated 07/11/2009 № 185 (effective from 08/30/2009); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 07/02/2018 No. 168-VI (shall be enforced upon the expiration of ten calendar days from the date of its first official publication); dated 01/16/2026 No. 259-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 4. Effect of civil legislation in time

1. Acts of civil legislation do not have retroactive force and apply to relations arising after their entry into force. The legal force of an act of civil legislation extends to relations that arose before its entry into force in cases where this is directly provided for by it.

2. For relations that arose before the entry into force of an act of civil legislation, it applies to the rights and obligations that arose after its entry into force. The relations of the parties under an agreement concluded before the entry into force of an act of civil legislation are regulated in accordance with Article 383 of this Code.

Article 5. Application of civil legislation by analogy

1. In cases where the relations provided for in paragraphs 1 and 2 of Article 1 of this Code are not directly regulated by legislation or agreement of the parties and there are no customs applicable to them, to such relations, since this does not contradict their essence, the norms of civil law governing similar relations (analogy of the law) are applied.

2. If it is impossible to use analogies of law in these cases, the rights and obligations of the parties are determined based on the general principles and meaning of civil legislation and the requirements of good faith, reasonableness and justice (analogy of law).

Article 6. Interpretation of civil law norms

1. Norms of civil legislation must be interpreted in accordance with the literal meaning of their verbal expression. If there is a possibility of different understanding of the words used in the text of legislative norms, preference is given to the understanding that meets the provisions of the Constitution of the Republic of Kazakhstan and the basic principles of civil legislation set out in this chapter, primarily in its Article 2.

2. When determining the exact meaning of a norm of civil law, it is necessary to take into account the historical conditions under which it was put into effect and its interpretation in judicial practice, unless this violates the requirements set out in paragraph 1 of this article.

Article 7. Grounds for the emergence, change and termination of civil rights and obligations

Civil rights and obligations arise, change and terminate on the grounds provided for by the legislation of the Republic of Kazakhstan, as well as from the actions of citizens and legal entities, which, although not provided for by it, but due to the general principles and meaning of civil legislation give rise to civil rights and obligations.

In accordance with this, civil rights and obligations arise, change and terminate:

1. from contracts and other transactions provided for by the legislation of the Republic of Kazakhstan, as well as from transactions, although not provided for by it, but not contrary to the legislation of the Republic of Kazakhstan;

2. from administrative acts entailing civil consequences by virtue of the legislation of the Republic of Kazakhstan;

3. from a court decision establishing civil rights and obligations;

4. as a result of the creation, destruction, acquisition or alienation of property on grounds not prohibited by the legislative acts of the Republic of Kazakhstan, as well as waiver of rights to property;

5. due to the creation of inventions, industrial designs, works of science, literature and art and other results of intellectual activity;

6. as a result of causing harm to another person, as well as due to the unjust acquisition or saving of property at the expense of another person (unjust enrichment);

7. due to other actions of citizens and legal entities;

8. due to events with which the legislation of the Republic of Kazakhstan associates the onset of civil consequences.

Footnote. Article 7 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 8. Exercise of civil rights

1. Citizens and legal entities, at their own discretion, dispose of their civil rights, including the right to their protection.

2. Failure to exercise the rights belonging to citizens and legal entities does not entail the termination of these rights, except for cases provided for by legislative acts.

3. The exercise of civil rights must not violate the rights and legally protected interests of other subjects of law and must not cause damage to the environment.

4. Citizens and legal entities must act in the exercise of their rights in good faith, wisely and fairly, observing the requirements contained in legislation, the moral principles of society, and entrepreneurs also the rules of business ethics.

This obligation cannot be excluded or limited by contract. Conscientiousness, reasonableness and fairness of the actions of participants in civil legal relations are assumed.

5. Actions of citizens and legal entities aimed at causing harm to another person, abuse of rights in other forms, as well as the exercise of rights contrary to its purpose are not allowed.

6. No one has the right to take advantage of his own dishonest behavior.

7. In case of non-compliance with the requirements provided for in paragraphs 3 - 6 of this article, the court may refuse to protect a person’s rights.

Footnote. Article 8 as amended by the laws of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force ten calendar days after its first official publication); dated 02.27.2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 9. Protection of civil rights

1. Protection of civil rights is carried out by court and arbitration through: recognition of rights; restoration of the situation that existed before the violation of the right; suppression of actions that violate the right or create a threat of its violation; awards to perform duties in kind; recovery of losses, penalties; recognizing a voidable transaction as invalid and applying the consequences of its invalidity, applying the consequences of the invalidity of a void transaction; compensation for moral damage; termination or change of legal relations; declaring invalid or not subject to application an act of a government body or a local representative or executive body that does not comply with the legislation of the Republic of Kazakhstan; collection of a fine from a government body or official for obstructing a citizen or legal entity in acquiring or exercising a right, as well as in other ways provided for by the legislative acts of the Republic of Kazakhstan.

Legal entities do not have the right to compensation for moral damage.

Protection of civil rights by compensation for moral damage caused to the consumer as a result of violation of his rights and legitimate interests provided for by the legislation of the Republic of Kazakhstan on the protection of consumer rights can be carried out by subjects of pre-trial settlement of consumer disputes.

2. Appealing to a government or administrative body for protection of a violated right does not prevent filing a claim in court to protect the right, unless legislative acts provide otherwise.

3. In cases specifically provided for by legislative acts, the protection of civil rights may be carried out by direct actual or legal actions of the person whose right is violated (self-defense).

4. A person whose right has been violated may demand full compensation for the losses caused to him, unless otherwise provided by legislative acts or agreement.

Losses mean expenses that are made or should be made by the person whose right is violated, loss or damage to his property (real damage), as well as lost income that this person would have received under normal conditions of turnover if his right had not been violated (lost profits).

5. Losses caused to a citizen or legal entity as a result of the issuance of an act of a government body or other government body that does not comply with the legislation, as well as actions (inaction) of officials of these bodies, are subject to compensation by the Republic of Kazakhstan or, accordingly

administrative-territorial unit.

6. If the onset of legal consequences of a violation depends on the guilt of the violator, his guilt is assumed except in cases where legislative acts provide otherwise.

Footnote. Article 9 as amended by the laws of the Republic of Kazakhstan dated 07/03/2013 No. 125-V (shall be enforced after ten calendar days after its first official publication); dated 04/08/2016 No. 489-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 06/25/2020 No. 346-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 10. Protection of the rights of entrepreneurs and consumers

1. Entrepreneurship is the independent, initiative activity of citizens, candidates and legal entities, aimed at obtaining net income through the use of property, production, sale of goods, performance of work, provision of services, based on the right of private property (private entrepreneurship) or on the right of economic management or operational management of a state enterprise (state entrepreneurship). Entrepreneurial activity is carried out on behalf, at risk and under the property responsibility of the entrepreneur.

2. The state guarantees freedom of entrepreneurial activity and ensures its protection and support.

3. The rights of entrepreneurs carrying out activities not prohibited by law are protected:

1. the possibility of carrying out business activities without obtaining any permits or sending notifications, except for the permits and notifications provided for by the Law of the Republic of Kazakhstan “On Permits and Notifications”;

2. the simplest possible procedure for registering all types of business in all spheres of the economy in one registration authority;

3. restriction by legislative acts of inspections of business activities carried out by government bodies;

4. forced termination of business activity only by a court decision made on the grounds provided for by a legislative act;

5. establishment by legislative acts of a list of works, types of goods and services that are prohibited for private entrepreneurship, prohibited or limited for export or import;

6. bringing state bodies, officials, as well as other persons and organizations to property liability established by law to entrepreneurs for unlawfully obstructing their activities;

6-1) prohibiting executive control and supervisory bodies from entering into contractual relations with business entities for the purpose of fulfilling the duties that are the functions of these bodies;

7. other means provided for by law.

4. The establishment of a permitting or notification procedure is carried out by the Law of the Republic of Kazakhstan “On Permits and Notifications” depending on the level of danger of an activity or action (operation) in order to protect the life and health of people, the environment, property, ensuring national security and law and order.

The permitting procedure is established in cases where the requirements for products provided for by the laws of the Republic of Kazakhstan and the requirements for mandatory confirmation of conformity are insufficient to achieve the goals of state regulation.

5. Commercial (entrepreneurial) secrets are protected by law. The procedure for determining information constituting a trade secret, the means of protecting it, as well as the list of information that should not be part of a trade secret are established by law.

6. Protection of consumer rights is ensured by the means provided for by this Code or other legislative acts.

Every consumer has, in particular, the right to:

• free conclusion of contracts for the purchase of goods, use of works and services;

• proper quality and safety of goods (works, services);

• complete and reliable information about goods (works, services);

• association of consumers into public organizations.

Footnote. Article 10 as amended by the Decree of the President of the Republic of Kazakhstan, having the force of Law, dated January 27, 1996 No. 2835; laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated July 10, 1998 No. 283; dated 12.01.2007 № 222 (shall be enforced after 6 months from the date of its official publication); dated March 25, 2011 No. 421-IV (shall be enforced ten calendar days after its first official publication); dated 16.05.2014 № 203-V (shall be enforced six months after the date of its first official publication); dated 10.29.2015 № 376-V (entered into effect from 01/01/2016); dated 13.05.2020 No. 327-VI (shall be enforced after the date of entry into force of the relevant amendments and additions to the Code of the Republic of Kazakhstan “On taxes and other obligatory payments to the budget” (Tax Code)).

Article 11. Inadmissibility of abuse of freedom of enterprise

1. Monopolistic and any other activities aimed at limiting or eliminating legitimate competition, obtaining unjustified advantages, or infringing on the rights and legitimate interests of consumers are not permitted.

2. It is not permitted, except for cases provided for by legislative acts, for entrepreneurs to use civil rights for the purpose of restricting competition, including:

1. abuse by entrepreneurs of their dominant position in the market, in particular, by limiting or stopping production or withdrawing goods from circulation to create a shortage or increase prices;

2. conclusion and execution by persons engaged in similar business activities of agreements on prices, division of markets, elimination of other entrepreneurs and other conditions that significantly limit competition;

3. committing unfair actions aimed at infringing on the legitimate interests of a person conducting similar business activities and consumers (unfair competition), in particular, by misleading consumers regarding the manufacturer, purpose, method and place of production, quality and other properties of the goods of another entrepreneur, by incorrectly comparing goods in advertising and other information, copying the external design of someone else’s goods and in other ways.

Measures to combat unfair competition are established by legislative acts.

Chapter 2. Subjects of civil rights

Paragraph 1. Citizens of the Republic of Kazakhstan and other individuals

Article 12. Concept of an individual

Individuals mean citizens of the Republic of Kazakhstan, citizens of other states, as well as stateless persons. The provisions of this chapter apply to all individuals, unless otherwise provided by this Code.

Article 13. Legal capacity of citizens

1. The ability to have civil rights and bear responsibilities (civil capacity) is recognized equally for all citizens.

2. The legal capacity of a citizen arises at the moment of his birth and ends with death.

Article 14. The main content of a citizen’s legal capacity

A citizen may own property, including foreign currency, both within the Republic of Kazakhstan and abroad, unless otherwise established by the Law of the Republic of Kazakhstan “On Anti-Corruption”; inherit and bequeath property; move freely throughout the territory of the republic and choose a place of residence; freely leave the republic and return to its territory; engage in any activity not prohibited by legislative acts; create legal entities independently or with other citizens and legal entities; make any transactions not prohibited by law and participate in obligations; have intellectual property rights to inventions, works of science, literature and art, and other results of intellectual activity; demand compensation for material and moral damage; have other property and personal non-property rights.

Footnote. Article 14 as amended by the laws of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication); dated 12/19/2020 No. 384-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 15. Citizen's name

1. A citizen acquires and exercises rights and obligations under his own name, which includes the surname and first name, and also, if desired, the patronymic.

2. Legislation may provide for cases of anonymous acquisition by citizens of rights and exercise of duties or the use of a pseudonym (fictitious name).

3. The name received by a citizen at birth, as well as a change in name, are subject to registration in the manner established by the legislation on civil registration.

4. A citizen has the right to change his name in the manner established by legislative acts. A change of name is not a basis for termination or modification of his rights and obligations acquired under the same name, anonymously or under a pseudonym.

5. A citizen is obliged to take the necessary measures to notify his debtors and creditors about the change of his name and bears the risk of consequences caused by the lack of information from these persons about the change of his name.

6. A citizen who has changed his name has the right to demand that appropriate changes be made to documents issued in his former name.

7. Acquiring rights and obligations under the name of another person is not permitted.

8. A citizen has the right to demand a ban on the use of his name when this was done without his consent, except in cases provided for by the laws of the Republic of Kazakhstan.

9. Harm caused to a citizen as a result of the unlawful use of his name is subject to compensation in accordance with the provisions of this Code.

When a citizen’s name is distorted or used in ways or in a form that affects his honor, dignity and business reputation, the rules provided for in Article 143 of this Code are applied.

Footnote. Article 15 as amended by the laws of the Republic of Kazakhstan dated January 12, 2007 No. 225 (shall be enforced from the date of its official publication); dated 05.21.2013 № 95-V (shall be enforced six months after its first official publication).

Article 16. Place of residence and legal address of a citizen

1. The place of residence is the locality where the citizen permanently or primarily resides.

2. The place of residence of persons under fourteen years of age (minors) or citizens under guardianship is recognized as the place of residence of their legal representatives.

3. A citizen has a legal address used in relations with individuals and legal entities, as well as the state.

The legal address of a citizen is the place of his registration.

4. A citizen has the right to demand a ban on the use of information about his place of residence or legal address when this was done without his consent, except in cases provided for by the laws of the Republic of Kazakhstan.

Footnote. Article 16 as amended by the laws of the Republic of Kazakhstan dated January 12, 2007 No. 224 (for the order of enforcement, see st. 2); dated 03/25/2011 № 421-IV (shall be enforced ten calendar days after its first official publication); dated 05/21/2013 № 95-V (shall be enforced six months after its first official publication); dated 05.21.2024 No. 86-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 17. Legal capacity of citizens

1. The ability of a citizen, through his actions, to acquire and exercise civil rights, to create civil responsibilities for himself and to fulfill them (civil capacity) arises in full with the onset of adulthood, that is, upon reaching the age of eighteen.

2. In cases where legislative acts allow marriage before the age of eighteen, a citizen who has not reached the age of eighteen acquires full legal capacity from the time of marriage.

3. All citizens have equal legal capacity, unless otherwise established by legislative acts.

Article 18. Inadmissibility of deprivation and limitation of legal capacity and capacity

1. No one can be limited in legal capacity and legal capacity except in cases and in the manner provided for by legislative acts.

2. Failure to comply with the conditions and procedure established by legislative acts for limiting the legal capacity and capacity of citizens or their right to engage in entrepreneurial or other activities entails the invalidity of the act of the state or other body that established the corresponding restriction.

3. A citizen’s complete or partial renunciation of legal capacity or legal capacity and other transactions aimed at limiting legal capacity or legal capacity are void, except for cases where such transactions are permitted by legislative acts.

Footnote. Article 18 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 19. Entrepreneurial activities of citizens

1. Citizens have the right to engage in entrepreneurial activities without forming a legal entity, with the exception of cases provided for by this Code and other legislative acts.

2. State registration of individual entrepreneurs consists of registration as an individual entrepreneur.

3. The rules of this Code, which regulate the activities of legal entities that are commercial organizations, unless otherwise follows from the legislation or the essence of the legal relationship, are applied to the entrepreneurial activities of citizens carried out without forming a legal entity.

4. Individuals are subject to state registration as an individual entrepreneur in accordance with the Entrepreneurial Code of the Republic of Kazakhstan.

4-1. Excluded by the Law of the Republic of Kazakhstan dated December 25, 2017 No. 122-VI (to come into effect from January 1, 2018).

5. If an individual entrepreneur carries out activities that are subject to licensing, he must have a license to carry out such activities.

The license is issued in the manner established by the legislation of the Republic of Kazakhstan on permits and notifications.

The Government of the Republic of Kazakhstan has the right to establish a simplified procedure for issuing licenses to individual entrepreneurs.

Footnote. Article 19 as amended by the laws of the Republic of Kazakhstan dated July 2, 1997 No. 144; dated December 24, 2001 No. 276 (effective from January 1, 2002); dated 12/10/2008 № 101-IV (effective from 01/01/2009); dated 06/30/2010 № 297-IV (effective from 01/01/2013); dated 12/26/2012 № 61-V (effective from 01/01/2013); dated 05/16/2014 № 203-V (shall be enforced six months after the date of its first official publication); dated 12/25/2017 No. 122-VI (effective from 01/01/2018).

Article 20. Property liability of a citizen

1. A citizen is liable for his obligations with all the property belonging to him, with the exception of property that cannot be foreclosed on in accordance with legislative acts.

2. Excluded by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication). Footnote. Article 20 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 20-1. Restoration of solvency and bankruptcy of a citizen of the Republic of Kazakhstan

1. If the citizen is unable to satisfy the demands of the creditor (creditors), procedures for restoring solvency, extrajudicial or judicial bankruptcy are applied on the terms and in the manner provided for by the Law of the Republic of Kazakhstan “On restoring solvency and bankruptcy of citizens of the Republic of Kazakhstan.”

2. This article does not apply to individuals registered as individual entrepreneurs in the manner prescribed by the legislation of the Republic of Kazakhstan.

Footnote. Chapter 2 is supplemented by Article 20-1 in accordance with the Law of the Republic of Kazakhstan dated December 30, 2022 No. 179-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 21. Bankruptcy of an individual entrepreneur

1. The insolvency of an individual entrepreneur (Article 52 of this Code) is the basis for declaring him bankrupt.

2. Bankruptcy of an individual entrepreneur is recognized voluntarily or compulsorily according to the rules established by the legislation of the Republic of Kazakhstan on rehabilitation and bankruptcy. From the date of entry into force of the court ruling on the completion of the bankruptcy procedure of an individual entrepreneur, his registration as an individual entrepreneur becomes invalid.

3. When bankruptcy procedures are applied to an individual entrepreneur, his creditors for obligations not related to business activities also have the right to present their claims if the deadline for fulfillment of such obligations has arrived. The claims of these creditors that were not declared by them in this manner, as well as claims that were not satisfied in full from the property mass, remain valid and can be brought for collection after the completion of bankruptcy procedures to the debtor as an individual. The amount of these claims is reduced by the amount of satisfaction received during the bankruptcy process of the debtor.

Footnote. Article 21 as amended by the Law of the Republic of Kazakhstan dated 03/07/2014 No. 177-V (shall be brought into force ten calendar days after the day of its first official publication); as amended by the Law of the Republic of Kazakhstan dated December 27, 2019 No. 290-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 21-1. Rehabilitation procedures for individual entrepreneurs

A debtor registered as an individual entrepreneur may be subject to any measures that do not contradict the legislation of the Republic of Kazakhstan aimed at restoring his solvency in order to prevent the termination of his business activities.

These measures are implemented within the framework of the rehabilitation procedure, the procedure and timing of which are determined by the legislation of the Republic of Kazakhstan on rehabilitation and bankruptcy.

Footnote. Chapter 2 is supplemented by Article 21-1 in accordance with the Law of the Republic of Kazakhstan dated December 27, 2019 No. 290-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 22. Legal capacity of minors aged fourteen to eighteen years

1. Minors aged fourteen to eighteen years make transactions with the consent of their legal representatives. The form of such consent must correspond to the form established by law for a transaction made by a minor.

2. Minors aged from fourteen to eighteen years have the right to independently manage their earnings, scholarships, other income and objects of intellectual property rights created by them, as well as to make small everyday transactions.

3. If there are sufficient grounds, the court may limit or deprive a minor of the right to independently dispose of his earnings, scholarships, other income and objects of intellectual property rights created by him.

4. Minors aged from fourteen to eighteen years are independently responsible for transactions made by them in accordance with the rules of this article, and are liable for damage caused by their actions, according to the rules of this Code.

Footnote. Article 22 as amended by the laws of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication); dated 10/31/2015 № 378-V (entered into effect from 01/01/2016).

Article 22-1. Declaring a minor fully capable (emancipation)

1. A minor who has reached the age of sixteen may be declared fully capable if he works under an employment contract or, with the consent of his legal representatives, is engaged in entrepreneurial activity.

2. A minor is declared fully capable (emancipation) by decision of the guardianship and trusteeship authority with the consent of his legal representatives or, in the absence of such consent, by a court decision.

3. An emancipated minor has civil rights and bears obligations (including obligations arising as a result of causing harm to them), with the exception of those rights and obligations for the acquisition of which the legislative acts of the Republic of Kazakhstan have established an age limit.

Legal representatives are not liable for the obligations of an emancipated minor.

Footnote. The Code is supplemented by Article 22-1 in accordance with the Law of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force ten calendar days after its first official publication).

Article 23. Legal capacity of minors under the age of fourteen (minors)

Footnote. The title of Article 23 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be enforced upon the expiration of ten calendar days after its first official publication).

1. For minors under fourteen years of age (minors), transactions are carried out on their behalf by legal representatives, unless otherwise provided by legislative acts.

2. Minors under the age of fourteen (minors) have the right to independently carry out only minor household transactions that are appropriate to their age and are executed upon their very completion.

Footnote. Article 23 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

Article 24. Consent of guardianship and trusteeship authorities to carry out transactions by minors and for minors

Legislative acts may establish cases when the prior consent of the guardianship and trusteeship authority is required to make a transaction by a minor and for a minor.

Article 25. The right of minors to make deposits in banks and manage deposits

1. Minors have the right to make deposits in banks and independently manage the deposits they make.

2. Deposits made by someone in the name of minors under fourteen years of age (minors) are managed by their parents or other legal representatives, and minors who have reached fourteen years of age independently manage deposits made by someone in their name.

Footnote. Article 25 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

Article 26. Recognition of a citizen as incompetent

1. A citizen who, due to mental illness or dementia, cannot understand the meaning of his actions or control them, may be declared incompetent by the court, and therefore guardianship is established over him.

2. On behalf of a citizen declared incompetent, transactions are carried out by his guardian.

3. In case of recovery or significant improvement in the health of the incapacitated person, the court recognizes him as capable, after which guardianship is removed from him.

Article 27. Limitation of a citizen’s legal capacity

1. A citizen who, due to the abuse of gambling, betting, alcoholic beverages or drugs, puts his family in a difficult financial situation, may be limited by the court in legal capacity in the manner established by the Civil Procedure Code of the Republic of Kazakhstan. Guardianship is established over him. He has the right to independently carry out small household transactions. He can make other transactions, as well as receive earnings, pensions and other income and dispose of them only with the consent of the trustee.

2. When a citizen stops abusing gambling, betting, alcoholic beverages or narcotic substances, the court shall revoke the restriction of his legal capacity. Based on a court decision, the guardianship established over the citizen is cancelled.

Footnote. Article 27 as amended by the Law of the Republic of Kazakhstan dated 07/02/2020 No. 356-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 28. Recognition of a citizen as missing

1. A citizen may, at the request of interested parties, be recognized by the court as missing if there is no information about him at his place of residence for one year.

2. If it is impossible to determine the day of receipt of the latest information about the absentee, the beginning of the unknown absence is considered to be the first day of the month following the one in which the latest information about the absentee was received, and if it is impossible to determine this month, the first of January of the next year.

Article 29. Protection of the property of a missing person

1. Guardianship is established over the property of a person recognized as missing on the basis of a court decision. From this property, maintenance is provided to the persons whom the missing person was obliged to support, and debts on taxes and other obligations of the missing person are repaid.

2. At the request of interested persons, the guardianship and trusteeship body may appoint a guardian for the protection and management of property until the expiration of one year from the date of receipt of the latest information about the whereabouts of the absent person.

Article 30. Cancellation of the decision to declare missing

In the event of the appearance or discovery of the whereabouts of a person recognized as missing, the court cancels the decision to recognize him as missing and to establish guardianship over his property.

Article 31. Declaring a citizen dead

1. A citizen may, at the request of interested parties, be declared dead by the court if there is no information about him at his place of residence for three years, and if he went missing under circumstances that threatened death or give reason to assume his death from an accident, for six months.

2. A serviceman or other person missing in action in connection with hostilities may be declared dead no earlier than two years from the date of the end of hostilities.

3. The day of death of a person declared dead is the day the court decision to declare him dead comes into force. In cases where a person who has gone missing under circumstances threatening death or giving reason to assume his death from an accident is declared dead, the court may recognize the day of death of this person as the day of his alleged death.

4. Based on a court decision that has entered into legal force to declare a person dead, a record of his death is made in the civil registration books. The consequences of recording are the same as recording an actual death.

Article 32. Consequences of the appearance of a person declared dead

1. In the event of the appearance or discovery of the place of residence of a person declared dead, the corresponding decision is canceled by the court.

2. Regardless of the time of his appearance, a citizen may demand from any person the return of the remaining property that was transferred free of charge to this person after the citizen was declared dead.

3. If the property of a person declared dead was alienated by his successor to third parties who, by the time the person appeared, had not paid the full purchase price, then the right to claim the unpaid amount passes to the person who appeared.

4. Persons to whom the property of a citizen declared dead was transferred through compensated transactions are obliged to return this property to him, and if they do not have property, to compensate its value if it is proven that at the time of acquiring the property they knew that the citizen declared dead was alive.

5. The alienator of property, who knew at the time of alienation that the person declared dead was alive, bears a joint and several obligation with the acquirer to return or reimburse the value of the property.

6. If the property of a person declared dead passed by right of inheritance to the state and was sold, then after the decision to declare the person dead is cancelled, the amount received from the sale of the property is returned to him, taking into account its market value on the day of payment.

Paragraph 2. Legal entities

Footnote. Parts III, IV, V are considered parts V, VI, VII - Law of the Republic of Kazakhstan dated July 10, 1998 N 282.

I. General provisions

Article 33. Concept of a legal entity

1. A legal entity is recognized as an organization that has separate property under the right of ownership, economic management or operational management and is liable with this property for its obligations, can, in its own name, acquire and exercise property and personal non-property rights and obligations, and be a plaintiff and defendant in court.

A legal entity must have an independent balance sheet or budget.

2. A legal entity has a seal with its name. This requirement does not apply to legal entities that are private businesses, except for cases provided for by this Code and the laws of the Republic of Kazakhstan.

Footnote. Article 33 as amended by the Law of the Republic of Kazakhstan dated December 29, 2014 No. 269-V (comes into force from 01/01/2015).

Article 34. Types and forms of legal entities

1. A legal entity may be an organization that pursues the generation of income as the main goal of its activities (a commercial organization) or does not have the extraction of income as such a goal and does not distribute the net income received among participants (a non-profit organization).

2. A legal entity that is a commercial organization can be created only in the form of a state enterprise, business partnership, joint-stock company, production cooperative.

3. A legal entity that is a non-profit organization may be created in the form of an institution, public association, joint stock company, consumer cooperative, foundation, religious association and in another form provided for by legislative acts.

A non-profit organization can engage in entrepreneurial activities only insofar as this corresponds to its statutory goals.

3-1. A legal entity that is a non-profit organization and is supported only by the state budget can be created exclusively in the form of a state institution.

4. Legal entities can create associations (Article 110 of this Code).

5. A legal entity acts on the basis of this Code, the Law on each of the forms of legal entities, other legislative acts and constituent documents.

Footnote. Article 34 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated July 10, 1998 No. 282; dated 16.12.1998 № 320; dated 12.01.2007 № 225 (shall be enforced from the date of its official publication); dated 04/27/2012 No. 15-V (shall be enforced after ten calendar days after its first official publication).

Article 35. Legal capacity of a legal entity

1. A legal entity may have civil rights and bear responsibilities related to its activities in accordance with this Code. Commercial organizations, with the exception of state enterprises, may have civil rights and bear civil responsibilities necessary to carry out any types of activities not prohibited by legislative acts or constituent documents.

In cases provided for by legislative acts, legal entities carrying out certain types of activities may be excluded or limited in their ability to engage in other activities.

A legal entity can engage in certain types of activities, the list of which is determined by legislative acts, only on the basis of a license.

2. The legal capacity of a legal entity arises at the moment of its creation and terminates at the moment of completion of its liquidation. The legal capacity of a legal entity in the field of activity for which it is necessary to obtain a permit arises from the moment of receipt of such a permit and terminates at the moment of its withdrawal, expiration or invalidation in the manner established by the legislative acts of the Republic of Kazakhstan.

3. The legal capacity of a legal entity that is a non-profit organization and is maintained only at the expense of the state budget (state institution) is determined by this Code and other legislative acts of the Republic of Kazakhstan.

Footnote. Article 35 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 16.12.1998 № 320; dated 16.05.2014 № 203-V (shall be enforced six months after the date of its first official publication).

Article 36. Rights of founders (participants) to the property of legal entities created by them

1. In relation to the separate property of a legal entity, its founders (participants) may have obligations or real rights.

2. Legal entities in whose property their participants (founders) retain rights of obligation include business partnerships, joint-stock companies and cooperatives.

3. Legal entities in whose property their founders retain ownership or other property rights include organizations that have property under the right of economic management or the right of operational management.

4. Legal entities in whose property their founders (participants) do not retain property rights include public associations, foundations and religious associations.

5. The rights of founders (participants) to the property of legal entities of other organizational and legal forms created by them are determined by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 36 as amended by the laws of the Republic of Kazakhstan dated July 10, 1998 No. 282; dated 12.01.2007 № 225 (shall be enforced from the date of its official publication); dated 04/27/2012 No. 15-V (shall be enforced after ten calendar days after its first official publication).

Article 37. Bodies of a legal entity

1. A legal entity acquires civil rights and assumes responsibilities only through its bodies acting in accordance with legislative acts and constituent documents.

2. The types, procedure for appointment or election of bodies of a legal entity and their powers are determined by legislative acts and constituent documents.

Footnote. Article 37 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated March 25, 2011 No. 421-IV (shall be enforced ten calendar days after its first official publication).

Article 38. Name of the legal entity

1. A legal entity has its own name, which allows it to be distinguished from other legal entities.

The name of a legal entity includes its name and an indication of its organizational and legal form. It may include additional information required by law.

The name of the legal entity is indicated in its constituent documents.

In the name of a legal entity, it is not permitted to use names that contradict the requirements of the law or norms of public morality; proper names of persons, if they do not coincide with the name of the participants or if the participants have not received permission from these persons (their heirs) to use their own name.

2. Under a certain name, a legal entity is entered into the National Register of Business Identification Numbers.

The name of a legal entity should not completely or substantially duplicate the name of legal entities registered in the Republic of Kazakhstan.

The name of a legal entity that is a commercial organization, after registration of the legal entity, is its corporate name.

A legal entity has the exclusive right to use a company name. A person who unlawfully uses someone else’s company name, at the request of the owner of the right to the company name, is obliged to stop using such name and compensate for the losses caused.

The rights and obligations of a legal entity related to the use of a company name are determined by law.

3. (excluded - No. 276 dated December 24, 2001)

4. It is prohibited to use in company names, service marks, trademarks of legal entities that are not government bodies, references to the official names of government bodies of the Republic of Kazakhstan, established by legislative acts, acts of the President and the Government of the Republic of Kazakhstan.

Footnote. Article 38 as amended by the laws of the Republic of Kazakhstan dated July 15, 1996 No. 30; dated 03/02/1998 No. 211; dated July 16, 1999 No. 440; dated 12/24/2001 № 276 (effective from 01/01/2002); dated March 25, 2011 No. 421-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated December 24, 2012 No. 60-V (shall be enforced after ten calendar days after its first official publication).

Article 39. Location of a legal entity

1. The location of a legal entity is the location of its permanent body.

2. The location of a legal entity is indicated in its constituent documents with a record of the full postal address.

3. In relations with third parties, a legal entity does not have the right to refer to the discrepancy between the actual address and the address entered in the National Register of Business Identification Numbers. In this case, third parties have the right to send postal and other correspondence to the legal entity both at the address entered in the National Register of Business Identification Numbers and at the actual address.

Footnote. Article 39 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated December 24, 2012 No. 60-V (shall be enforced ten calendar days after its first official publication).

Article 40. Founders of a legal entity

1. A legal entity may be established by one or more founders.

2. The founders of a legal entity may be the owners of property or bodies or persons authorized by them, and in cases specifically provided for by legislative acts - other legal entities. At the same time, legal entities that own property under the right of economic management or operational management may be founders of other legal entities with the consent of the owner or his authorized body, unless otherwise provided by the laws of the Republic of Kazakhstan.

3. The founders of a legal entity cannot have any advantages over other participants of this legal entity who are not its founders, except for cases provided for by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 40 as amended by the laws of the Republic of Kazakhstan dated May 16, 2003 N 416; dated 02/18/2011 No. 408-IV (shall be enforced ten calendar days after its first official publication).

Article 41. Constituent documents of a legal entity

1. Unless otherwise provided by this Code and the legislative acts of the Republic of Kazakhstan, a legal entity carries out its activities on the basis of:

1. charter and constituent agreement;

2. charter;

3. the charter and a written decision on the establishment of a legal entity (decision of the sole founder) if the legal entity was founded by one person.

In cases provided for by the legislative acts of the Republic of Kazakhstan, a legal entity that is a non-profit organization may act on the basis of the general regulations on organizations of this type or a standard charter, the content of which is determined by the relevant authorized state body.

A legal entity that is a subject of small, medium and large businesses can carry out its activities on the basis of a standard charter, the content of which is determined by the Ministry of Justice of the Republic of Kazakhstan.

2. The constituent agreement of a legal entity is concluded, and the charter is approved by its founders. A constituent agreement is not concluded if a commercial organization is founded by one person.

3. The constituent documents of a non-profit organization and a state enterprise must define the subject and goals of the legal entity’s activities.

The constituent documents of a business partnership, joint-stock company and production cooperative may stipulate the subject and goals of their activities.

4. In the constituent agreement, the parties (founders) undertake to create a legal entity, determine the procedure for joint activities for its creation, the conditions for transferring their property into its ownership (operational management) and participation in its activities. The agreement also determines the conditions and procedure for the distribution of net income between the founders, management of the activities of the legal entity, the withdrawal of the founders from its membership and approves its charter, unless otherwise provided by this Code or legislative acts on certain types of legal entities.

Other conditions may be included in the constituent agreement by agreement of the founders.

4-1. The decision of the sole founder must contain the conditions for the transfer of property into ownership (economic management, operational management) and other decisions that do not contradict the legislation of the Republic of Kazakhstan.

The decision of the sole founder-legal entity is made by its bodies that have the right to make such decisions in accordance with the legislation of the Republic of Kazakhstan and the charter of this legal entity.

5. The charter of a legal entity determines: its name, location, procedure for the formation and competence of its bodies, conditions for reorganization and liquidation.

If a legal entity is established by one person, then its charter also determines the procedure for the formation of property and the distribution of income.

The charter may contain other provisions that do not contradict the legislation of the Republic of Kazakhstan.

6. In case of contradictions between the constituent agreement and the charter of one legal entity, the following conditions must apply:

1. the constituent agreement, if they relate to the relationship of the founders;

2. the charter, if their application may have implications for the legal entity’s relations with third parties.

7. All interested parties have the right to familiarize themselves with the charter of a legal entity.

Footnote. Article 41 as amended by the laws of the Republic of Kazakhstan dated July 15, 1996 N 30; dated 06/19/1997 N 132; dated 07/11/1997 N 154; dated 03/02/1998 N 211; dated 04/22/1998 N 221; dated July 10, 1998 N 282; dated 05/16/2003 N 416; dated 12.01.2007 N 225 (shall be enforced from the date of its official publication); dated 04.07.2008 N 54-IV (the order of enforcement see Article. 2); dated 08.12.2009 № 225-IV (for the order of enforcement, see st. 2); dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 12/26/2019 No. 284-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication).

Article 42. State registration and re-registration of legal entities

1. A legal entity that is a non-profit organization is subject to state registration with the justice authorities.

A legal entity that is a commercial organization is subject to state registration with the State Corporation "Government for Citizens", except for cases provided for by the legislative acts of the Republic of Kazakhstan.

The procedure for state registration is determined by the legislation of the Republic of Kazakhstan.

2. State registration data, including the name of legal entities, and for commercial organizations - business name, are included in the National Register of Business Identification Numbers.

3. A legal entity is considered created from the moment of its state registration.

4. Branches and representative offices are registered in the manner prescribed by legislative acts.

Branches and representative offices are subject to re-registration in case of name change.

5. Violation of the procedure established by law for the formation of a legal entity or non-compliance of its constituent documents with the law shall entail refusal of state registration of the legal entity. Refusal to register based on the inexpediency of forming a legal entity is not permitted.

Refusal of state registration, as well as evasion of such registration, may be appealed in the manner established by the laws of the Republic of Kazakhstan.

6. A legal entity is subject to re-registration in the following cases:

1. reducing the size of the authorized capital;

2. name changes;

3. changes in the composition of participants in business partnerships (with the exception of business partnerships in which the maintenance of the register of participants in a business partnership is carried out by a professional participant in the securities market, carrying out activities to maintain a system of registers of security holders).

Changes made to the constituent documents on the specified grounds without re-registration of the legal entity are invalid.

Footnote. Article 42 as amended by the laws of the Republic of Kazakhstan dated July 15, 1996 N 30; dated 07/11/1997 N 154; dated 03/02/1998 N 211; dated July 10, 1998 N 282; dated 05/16/2003 N 416; dated 07/08/2005 N 72 (the order of enforcement see Article 2); dated 06/05/2006 N 146 (the order of enforcement see Article 2); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 12/28/2011 № 524-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated December 24, 2012 No. 60-V (shall be enforced upon expiration of ten calendar days after its first official publication); dated 04/02/2019 No. 241-VI (effective from 07/01/2019); dated 06/29/2020 No. 351-VI (takes effect from 07/01/2021).

Article 43. Branches, representative offices and other separate structural units of a legal entity

1. A branch is a separate division of a legal entity located outside its location and performing all or part of its functions, including the functions of a representative office.

2. A representative office is a separate division of a legal entity, located outside its location and protecting and representing the interests of the legal entity, performing transactions and other legal actions on its behalf, except for cases provided for by the legislative acts of the Republic of Kazakhstan.

3. Branches and representative offices are not legal entities. They are endowed with property by the legal entity that created them and act on the basis of the provisions approved by it.

4. Legal entities have the right to create other separate structural divisions, except for cases established by law.

Another separate structural unit of a legal entity is a territorially separate unit, at the location of which stationary workplaces are equipped that perform part of the functions of the legal entity. A workplace is considered stationary if it is created for a period of more than one month.

Another separate structural unit of a state institution is created in cases directly provided for by laws.

5. The heads of structural divisions (branches and representative offices) of public associations are elected in the manner prescribed by the charter of the public association and the regulations on its branch or representative office.

Heads of structural units (branches and representative offices) of religious associations are elected or appointed in the manner prescribed by the charter of the religious association and the regulations on its branch or representative office.

Heads of branches and representative offices of other forms of legal entities are appointed by the authorized body of the legal entity and act on the basis of its power of attorney.

Footnote. Article 43 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 44. Liability of a legal entity

1. Legal entities, except for special financial companies, state Islamic special financial companies financed by the founder of institutions and state-owned enterprises, are liable for their obligations with all the property belonging to them.

The institution is responsible for its obligations with the money at its disposal. If they are insufficient, the founder is responsible for its obligations.

A state-owned enterprise is liable for its obligations with the money at its disposal.

If a state-owned enterprise does not have enough money, the Republic of Kazakhstan or an administrative-territorial unit bears subsidiary liability for its obligations with funds from the corresponding budget.

The special financial company is responsible for its obligations in the manner prescribed by the legislation of the Republic of Kazakhstan on project financing and securitization.

The State Islamic Special Finance Company is liable for its obligations with the money at its disposal.

2. The founder (participant) of a legal entity or the owner of its property is not liable for its obligations, and a legal entity is not liable for the obligations of the founder (participant) of a legal entity or the owner of its property, except for cases provided for by this Code, other legislative acts or constituent documents of a legal entity.

3. A founder (participant) and (or) official found guilty of deliberate bankruptcy in administrative or criminal proceedings, if the legal entity has insufficient funds as a result of the bankruptcy procedure, bears subsidiary liability to creditors.

4. A legal entity is liable to third parties for obligations assumed by the body of the legal entity in excess of its powers established by the constituent documents, except for the cases provided for in clause 11 of Article 159 of this Code.

Footnote. Article 44 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated December 16, 1998 No. 320; dated 04.11.1999 No. 472; dated 20.05.2003 N 417; dated 20.02.2006 No. 127 (for the order of enforcement, see st.2); dated 12.01.2007 No. 225 (shall be enforced from the date of its official publication); dated 01.03.2011 № 414-IV (shall be enforced from the date of its first official publication); dated 12.01.2012 № 539-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated November 24, 2015 No. 422-V (entered into effect from 01/01/2016); dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated December 27, 2019 No. 290-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication); dated 06/29/2020 No. 351-VI (takes effect from 07/01/2021).

Article 45. Reorganization of a legal entity

1. Reorganization of a legal entity (merger, accession, division, separation, transformation) is carried out by decision of the owner of its property or a body authorized by the owner, founders (participants), as well as a body authorized by the constituent documents of the legal entity, or by decision of the judicial authorities in cases provided for by the legislative acts of the Republic of Kazakhstan. The legislation of the Republic of Kazakhstan may provide for other forms of reorganization.

Reorganization of a legal entity - a voluntary accumulative pension fund, an insurance (reinsurance) organization, an Insurance Payment Guarantee Fund, a special financial company, a payment organization, a microfinance organization is carried out taking into account the features provided for by the legislation of the Republic of Kazakhstan on social protection, insurance and insurance activities, the Insurance Payment Guarantee Fund, project financing and securitization, payments and payment systems, microfinance activities.

Reorganization of joint stock companies is carried out taking into account the specifics established by the legislative act of the Republic of Kazakhstan on joint stock companies.

2. Reorganization can be carried out voluntarily or compulsorily.

3. Forced reorganization may be carried out by decision of the judicial authorities in cases provided for by legislative acts.

If the owner of the property of a legal entity, the body authorized by it, the founders or the body of the legal entity authorized to reorganize its constituent documents, does not carry out the reorganization of the legal entity within the period specified in the decision of the judicial authority, the court appoints a manager of the legal entity and instructs him to carry out the reorganization of this legal entity. From the moment the manager is appointed, the powers to manage the affairs of the legal entity are transferred to him. The manager acts on behalf of the legal entity in court, draws up a separation balance sheet and submits it for approval by the court along with the constituent documents of the legal entities arising as a result of the reorganization. Court approval of these documents is the basis for state registration of newly emerging legal entities.

4. A legal entity is considered reorganized, with the exception of cases of reorganization in the form of merger, from the moment of registration of newly emerged legal entities.

When a legal entity is reorganized by merging with it another legal entity, the first of them is considered reorganized from the moment information about the termination of the activities of the affiliated legal entity is entered into the National Register of Business Identification Numbers.

Footnote. Article 45 as amended by the laws of the Republic of Kazakhstan dated June 19, 1997 N 134; dated 12/18/2000 N 128; dated 07/08/2005 N 72 (the order of enforcement see Article 2); dated 20.02.2006 N 127 (for the order of enforcement, see st.2); dated 12/30/2009 № 234-IV; dated 01/12/2012 № 539-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 12/24/2012 № 60-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 06/21/2013 No. 106-V (shall be enforced upon expiration of ten calendar days after its first official publication); dated July 26, 2016 No. 12-VI (shall be enforced thirty calendar days after the day of its first official publication); dated 07/12/2022 No. 138-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication); dated 04/20/2023 No. 226-VII (takes effect from 07/01/2023).

Article 46. Succession during reorganization of legal entities

1. When legal entities merge, the rights and obligations of each of them are transferred to the newly emerged legal entity in accordance with the transfer deed.

2. When a legal entity is merged with another legal entity, the rights and obligations of the merged legal entity are transferred to the latter in accordance with the transfer deed.

3. When a legal entity is divided, its rights and obligations are transferred to the newly created legal entities in accordance with the separation balance sheet.

4. When one or more legal entities are separated from a legal entity, the rights and obligations of the reorganized legal entity are transferred to each of them in accordance with the separation balance sheet.

5. When a legal entity of one type is transformed into a legal entity of another type (change of organizational and legal form), the rights and obligations of the reorganized legal entity are transferred to the newly emerged legal entity in accordance with the transfer deed.

Article 47. Transfer act and separation balance sheet

1. The property rights and obligations of the reorganized legal entity are transferred to the newly emerged legal entity: during a merger and accession - in accordance with the transfer act, during division and separation - in accordance with the separation balance sheet.

The transfer deed and the separation balance sheet must contain provisions on the succession of all obligations of the reorganized legal entity in relation to all its creditors and debtors, including obligations disputed by the parties.

2. The transfer act and the separation balance sheet are approved by the owner of the property of the legal entity or the body that made the decision on the reorganization of the legal entity, and are presented together with the constituent documents for registering newly emerged legal entities or making changes to the constituent documents of existing legal entities.

Failure to submit a transfer deed or separation balance sheet, respectively, with the constituent documents, as well as the absence in them of provisions on succession of obligations of the reorganized legal entity, entails a refusal of state registration of newly emerged legal entities.

3. Property (rights and obligations) passes to the legal successor at the time of its registration, unless otherwise provided by legislative acts or a decision on reorganization.

Article 48. Guarantees of the rights of creditors of a legal entity during its reorganization

1. The owner of the property of a legal entity or the body that made the decision on the reorganization of the legal entity is obliged to notify in writing the creditors of the reorganized legal entity. The period for filing claims cannot be less than two months from the date of receipt of notifications by creditors of the reorganized legal entity.

2. When dividing and separating, the creditor of the reorganized legal entity has the right to demand early termination of the obligation for which this legal entity is the debtor and compensation for losses.

3. If the separation balance sheet does not make it possible to determine the legal successor of the reorganized legal entity or if the legal successor does not have enough property to fulfill the obligations that arose before the reorganization, the newly emerged legal entities, as well as the legal entity from which another legal entity was separated, bear joint liability for the obligations of the reorganized legal entity to its creditors.

Footnote. Article 48 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated 04/02/2010 № 262-IV (effective from 10/21/2010); dated December 24, 2012 No. 60-V (shall be enforced ten calendar days after its first official publication).

Article 49. Grounds for liquidation of a legal entity

1. By decision of the owner of his property or a body authorized by the owner, as well as a body of a legal entity authorized to do so by the constituent documents, a legal entity may be liquidated for any reason.

Liquidation of a legal entity - a voluntary savings pension fund, an insurance (reinsurance) organization, an Insurance Payment Guarantee Fund, a special financial company is carried out taking into account the specifics provided for by the legislation of the Republic of Kazakhstan on social protection, insurance and insurance activities, the Insurance Payment Guarantee Fund, project financing and securitization.

2. By a court decision, a legal entity may be liquidated in the following cases:

1. bankruptcy;

2. invalidation of the registration of a legal entity in connection with violations of the law committed during its creation, which are of an irreparable nature;

3. absence of a legal entity at its location or actual address, as well as founders (participants) and officials, without whom the legal entity cannot function for one year;

4. carrying out activities in gross violation of the law:

systematic implementation of activities that contradict the statutory goals of the legal entity;

carrying out activities without a proper license or activities prohibited by law;

5. provided for by other legislative acts.

3. A demand for the liquidation of a legal entity on the grounds specified in paragraph two of this article may be presented to the court by a state body to which the right to present such a demand is granted by legislative acts, and in cases of bankruptcy - also by a creditor.

By a court decision on the liquidation of a legal entity, the responsibilities for carrying out the liquidation of a legal entity may be assigned to the owner of its property, a body authorized by the owner, a body authorized to liquidate a legal entity by its constituent documents, a body (person) that initiated the procedure for the forced liquidation of a legal entity, or another body (person), if the implementation of functions for the liquidation of a legal entity by this body (person) does not contradict the legislation of the Republic of Kazakhstan.

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5. Liquidation of certain types of legal entities is possible by decision of the relevant body authorized by the state, on the grounds provided for by legislative acts.

Footnote. Article 49 as amended by the laws of the Republic of Kazakhstan dated January 21, 1997 No. 68; dated 06/19/1997 No. 134; dated 03/02/1998 No. 211; dated 12/18/2000 № 128; dated 12/24/2001 № 276 (effective from 01/01/2002); dated 20.02.2006 N 127 (for the order of enforcement, see st.2); dated 12.01.2007 № 225 (shall be enforced from the date of its official publication); dated July 21, 2007 No. 299; dated 12/30/2009 № 234-IV; dated 03/25/2011 № 421-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 01/12/2012 № 539-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 06/21/2013 № 106-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 03/07/2014 № 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 05/16/2014 № 203-V (shall be enforced six months after the date of its first official publication); dated December 27, 2019 No. 290-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication); dated 01/05/2021 No. 409-VI (takes effect from 01/01/2022); dated 04/20/2023 No. 226-VII (takes effect from 07/01/2023).

Article 50. Procedure for liquidation of a legal entity

1. The owner of the property of a legal entity or the body that made the decision to liquidate the legal entity is obliged to immediately report this in writing or through an Internet resource using an electronic digital signature to the justice body or the State Corporation "Government for Citizens" that carries out registration of legal entities, the state revenue authority at the place of registration.

2. The owner of the property of a legal entity or the body that made the decision to liquidate the legal entity shall appoint a liquidation commission and establish the procedure and timing of liquidation in accordance with this Code.

From the moment the liquidation commission is appointed, the powers to manage the property and affairs of the legal entity are transferred to it. The liquidation commission acts in court on behalf of the liquidated legal entity.

3. The liquidation commission publishes information on the liquidation of a legal entity, as well as the procedure and deadline for filing claims by its creditors in periodicals distributed throughout the territory of the Republic of Kazakhstan. The period for filing claims cannot be less than two months from the date of publication of the liquidation announcement, except in cases of bankruptcy. In case of bankruptcy, creditors' claims against the bankrupt must be submitted no later than one month from the date of publication of the announcement on the procedure for filing claims by creditors.

The liquidation commission takes measures to identify creditors and collect debt, and also notifies creditors in writing about the liquidation of the legal entity.

4. After the deadline for filing claims by creditors has expired, the liquidation commission draws up an interim liquidation balance sheet, which contains information about the composition of the property of the legal entity being liquidated, the list of claims filed by creditors, as well as the results of their consideration.

The interim liquidation balance sheet is approved by the owner of the property of the legal entity or the body that made the decision to liquidate the legal entity.

When compiling an interim liquidation balance sheet, the property of a liquidated legal entity does not include allocated assets that are collateral for the obligations of a special financial company for project financing, for bonds of a special financial company for securitization, issued in accordance with the legislation of the Republic of Kazakhstan on project financing and securitization, and collateral property that is the following collateral for mortgage bonds: rights of claim under residential mortgage loan agreements (including mortgage certificates), as well as government securities of the Republic of Kazakhstan in cases where the ownership of these bonds arose with their holders or was transferred to them through transactions or on other grounds provided for by the legislative acts of the Republic of Kazakhstan. The specified property and allocated assets are transferred by the liquidation commission to the representative of the holders of mortgage bonds, the representative of creditors and (or) holders of bonds determined in accordance with the legislation of the Republic of Kazakhstan on project financing and securitization, to satisfy the claims of creditors.

When compiling an interim liquidation balance sheet, the property of a liquidated state Islamic special financial company does not include property sold to the state Islamic special financial company based on a decision of the Government of the Republic of Kazakhstan. The specified property is transferred by the liquidation commission into the ownership of the Republic of Kazakhstan in the manner and within the time frame determined by the Government of the Republic of Kazakhstan.

5. If a legal entity being liquidated (except for state institutions) does not have enough money to satisfy the claims of creditors, the liquidation commission sells the legal entity’s property at public auction in the manner established for the execution of court decisions.

When selling at public auction the pledged property included in the property of a legal entity being liquidated, the claims of the pledged creditors are satisfied preferentially before other creditors within the limits of the amount received from the sale of the pledged property.

If the amount from the sale of the pledged item is insufficient, the remaining amount of the pledged creditor's claims shall be satisfied in the order of priority established by Article 51 of this Code.

6. Payment of money to creditors of a liquidated legal entity is made by the liquidation commission in the order of priority established by Article 51 of this Code, in accordance with the interim liquidation balance sheet, starting from the day of its approval. Features of the distribution of property of joint-stock companies are established by the legislation of the Republic of Kazakhstan on joint-stock companies.

If the property of a legal entity being liquidated contains pledged property, the pledged creditor has the right to satisfy its claims by accepting the pledged property in kind.

The liquidation commission, within ten working days from the date of receipt from the secured creditor of the notification of acceptance of the pledged property in kind, evaluates it.

The transfer of the pledged property to the secured creditor is carried out after the assessment, taking into account the requirements provided for in parts five and six of this paragraph.

If the estimated value of the pledged property, minus the costs incurred to evaluate the pledged property, is greater than the claims of the pledged creditor, then the difference is returned by the pledged creditor to the property of the liquidated legal entity.

If the estimated value of the pledged property minus the costs incurred to evaluate the subject of pledge is less than the claims of the pledged creditor, the claims of the pledged creditor in the amount of the difference are subject to satisfaction in the order of priority established by Article 51 of this Code.

7. After completing settlements with creditors, the liquidation commission draws up a liquidation balance sheet, which is approved by the owner of the property of the legal entity or the body that made the decision to liquidate the legal entity.

8. The property remaining after satisfaction of the creditors’ claims is directed to the purposes specified in the constituent documents.

9. If the liquidated state-owned enterprise does not have enough property, and the liquidated institution does not have enough money to satisfy the claims of creditors, the latter have the right to apply to the court with a claim to satisfy the remaining part of the claims at the expense of the owner of the property of this enterprise or institution.

9-1. Excluded by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

10. The liquidation of a legal entity is considered completed, and the legal entity has ceased its activities after entering information about this into the National Register of Business Identification Numbers.

Footnote. Article 50 as amended by the laws of the Republic of Kazakhstan dated July 15, 1996 N 30; dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated July 10, 1998 No. 282; dated December 16, 1998 No. 320; dated 06/03/2003 N 426; dated January 10, 2006 No. 115 (shall be enforced from the date of its official publication); dated 20.02.2006 No. 127 (for the order of enforcement, see st.2); dated 12.01.2007 No. 225 (shall be enforced from the date of its official publication); dated 01.03.2011 № 414-IV (shall be enforced from the date of its first official publication); dated 12.01.2012 № 539-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 12/24/2012 № 60-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 03/07/2014 № 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 07.11.2014 № 248-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 10.29.2015 № 376-V (entered into effect from 01/01/2016); dated November 24, 2015 No. 422-V (entered into effect from 01/01/2016); dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 04/02/2019 No. 241-VI (for the order of enforcement, see Article 2).

Article 51. Satisfaction of creditors' claims

1. When liquidating a legal entity, with the exception of cases of bankruptcy, the claims of its creditors are satisfied in the following order:

1. first of all, the requirements for payment of alimony withheld from wages and (or) other income are satisfied, as well as the claims of citizens to whom the liquidated legal entity is liable for causing harm to life or health, by capitalizing the corresponding time-based payments;

2. secondly - calculations are made for wages and compensation to persons who worked under an employment contract, payment of arrears of social contributions to the State Social Insurance Fund, compulsory pension contributions withheld from wages, compulsory professional pension contributions, deductions and (or) contributions for compulsory social health insurance to the social health insurance fund, as well as payment of remunerations under copyright agreements, except for cases when part of the amounts of claims in accordance with legislative act of the Republic of Kazakhstan regulating bankruptcy issues is satisfied in the fifth place;

3. in the third place - the claims of creditors for obligations secured by a pledge of the property of the liquidated bankrupt are satisfied, within the amount of security, with the exception of the claims of creditors - holders of mortgage bonds secured by a pledge of claims under residential mortgage loan agreements (including pledge of mortgage certificates), government securities of the Republic of Kazakhstan in cases where the ownership of these bonds arose from their holders or transferred to them through transactions or on other grounds provided for by the legislative acts of the Republic of Kazakhstan, as well as the claims of creditors that are satisfied in accordance with part two clause 5 or part two clause 6 of Article 50 of this Code;

4. fourthly, debts on taxes and other obligatory payments to the budget are repaid;

5. fifthly - settlements are made with other creditors in accordance with the legislative acts of the Republic of Kazakhstan, as well as with secured creditors in cases provided for in part three clause 5 and part six clause 6 Article 50 of this Code;

2. The requirements of each queue are satisfied after the requirements of the previous queue are fully satisfied.

3. If the property of a liquidated legal entity is insufficient, it is distributed among the creditors of the corresponding priority in proportion to the amounts of claims to be satisfied, unless otherwise provided by law.

4. If the liquidation commission refuses to satisfy the creditor’s claims or evades their consideration, the creditor has the right, before the liquidation balance sheet of the legal entity is approved, to file a claim with the liquidation commission. By a court decision, the creditor's claims may be satisfied at the expense of the remaining property of the liquidated legal entity.

5. The property of a legal entity remaining after satisfaction of the creditors’ claims is transferred to its owner or founders (participants) who have proprietary rights to this property or rights of obligation in relation to the legal entity, unless otherwise provided by law or the constituent documents of the legal entity.

6. Claims of creditors that are not satisfied due to the insufficiency of the property of the legal entity being liquidated, as well as those that were not filed before the approval of the liquidation balance sheet, are considered extinguished.

Claims of creditors that were not recognized by the liquidation commission are also considered extinguished if the creditor did not file a claim in court, and claims the satisfaction of which was denied to the creditor by a court decision.

Footnote. Article 51 as amended by the laws of the Republic of Kazakhstan dated January 21, 1997 N 68; dated 03/02/1998 N 211; dated July 11, 2001 N 239; dated 06/03/2003 N 426; dated 04/08/2004 N 542 (effective from 01/01/2005); dated 12.01.2007 N 225 (shall be enforced from the date of its official publication); dated 06/21/2013 № 106-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 03/07/2014 No. 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated November 16, 2015 No. 406-V (takes effect from July 1, 2017); dated 04/02/2019 No. 241-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 52. Bankruptcy

Bankruptcy is the insolvency of a debtor recognized by a court decision, which is the basis for its liquidation.

The debtor's insolvency is established by the court taking into account the conclusion on financial stability drawn up in accordance with the legislation of the Republic of Kazakhstan on rehabilitation and bankruptcy.

Footnote. Article 52 as amended by the Law of the Republic of Kazakhstan dated January 21, 1997 N 68; dated 06.29.1998 № 238; as amended by the laws of the Republic of Kazakhstan dated 07/05/2008 N 60-IV (for the order of enforcement, see st.2); dated 03/07/2014 No. 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated November 16, 2015 No. 406-V (takes effect from July 1, 2017); dated December 27, 2019 No. 290-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication).

Article 53. Recognition of bankruptcy

1. Recognition of bankruptcy is possible voluntarily or compulsorily.

2. Recognition of bankruptcy on a voluntary basis is carried out on the basis of an application from the debtor to the court.

3. Compulsory recognition of bankruptcy is carried out on the basis of an application to the court by the creditor, and in cases provided for by legislative acts, by other persons.

Footnote. Article 53 as amended by the Laws of the Republic of Kazakhstan dated January 21, 1997 N 68; dated June 29, 1998 No. 238.

Article 54. Rehabilitation procedures in relation to a legal entity

Any measures that do not contradict the legislation of the Republic of Kazakhstan aimed at restoring its solvency in order to prevent liquidation may be applied to a legal entity - a debtor.

These measures are implemented within the framework of the rehabilitation procedure, the procedure and timing of which are determined by the legislation of the Republic of Kazakhstan on rehabilitation and bankruptcy.

Footnote. Article 54 as amended by the Law of the Republic of Kazakhstan dated December 27, 2019 No. 290-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 54-1. External surveillance

Footnote. Article 54-1 is excluded by the Law of the Republic of Kazakhstan dated 03/07/2014 No. 177-V (shall be enforced upon expiration of ten calendar days after the day of its first official publication).

Article 55. Consequences of initiating bankruptcy proceedings

1. From the day the court makes a decision to declare the debtor bankrupt and initiate bankruptcy proceedings:

1. the owner of the bankrupt’s property (the body authorized by him), the founders (participants), all bodies of the bankrupt legal entity are prohibited from alienating property and repaying obligations;

2. the terms of all debt obligations of the bankrupt are considered expired;

3. the accrual of penalties and remuneration (interest) for all types of debt of the bankrupt is stopped;

4. property disputes involving the bankrupt, considered in court, are terminated if the decisions taken on them have not entered into legal force;

5. claims can be presented to a bankrupt only within the framework of bankruptcy proceedings, with the exception of requirements for the execution of guarantees and sureties of third parties, as well as foreclosure of the collateral in cases where the mortgagor is third parties;

6. on the basis of an application from a temporary or bankruptcy manager and a submitted copy of the court decision declaring the debtor bankrupt, all restrictions and encumbrances on the bankrupt’s property are lifted (collection orders from financial and government bodies on the debtor’s accounts, arrests on property imposed by bailiffs, and others) without the adoption of appropriate decisions by the authorities that imposed them;

7. the imposition of new arrests on the bankrupt’s property and other restrictions on the disposal of the bankrupt’s property is allowed only in cases of declaring the transaction invalid and reclaiming property from someone else’s illegal possession, brought against the bankrupt;

8. the bankrupt’s property, which was not transferred to the acquirer at the time of initiation of bankruptcy proceedings, is included in the bankrupt’s property mass, and the creditor or failed acquirer of an unfulfilled obligation has the right to present his claims to the debtor within the framework of the bankruptcy procedure.

Footnote. Article 55 as amended by the Law of the Republic of Kazakhstan dated 03/07/2014 No. 177-V (shall be brought into force ten calendar days after the day of its first official publication).

Article 56. Release of an insolvent debtor from debts

Footnote. Article 56 is excluded by the Law of the Republic of Kazakhstan dated December 30, 2022 No. 179-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 57. Termination of activities of a bankrupt legal entity

1. A court declaring a legal entity bankrupt entails its liquidation.

2. The activities of a bankrupt legal entity are considered terminated from the moment it is excluded from the National Register of Business Identification Numbers.

Footnote. Article 57 as amended by the Law of the Republic of Kazakhstan dated December 24, 2012 No. 60-V (shall be brought into force after ten calendar days after its first official publication).

II. Economic partnership

1. General provisions

Article 58. Basic provisions on a business partnership

1. A business partnership is a commercial organization with an authorized capital divided into shares (contributions) of founders (participants). Property created through the contributions of founders (participants), as well as produced and acquired by a business partnership in the course of its activities, belongs to the partnership by right of ownership.

2. Business partnerships can be created in the form of a full partnership, limited partnership, limited liability partnership, or additional liability partnership.

3. A business partnership, in addition to a full and limited partnership, can be created by one person, who becomes its sole participant.

Only citizens can be participants in a general partnership and general partners in a limited partnership.

4. The constituent documents of a business partnership are the constituent agreement and the charter.

The constituent document of a business partnership, which is founded by one person (one participant), is the charter.

5. Excluded by the Law of the Republic of Kazakhstan dated December 24, 2012 No. 60-V (shall be enforced upon the expiration of ten calendar days after its first official publication).

6. The constituent documents of a business partnership must contain, in addition to the information specified in paragraphs 4 and 5 of Article 41 of this Code, conditions on the size of the shares of each of the participants; on the amount, composition, timing and procedure for making contributions to the authorized capital of the partnership; on the liability of participants for violation of obligations to make contributions to the authorized capital of the partnership, as well as other information provided for by legislative acts.

7. Excluded by the Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

8. A business partnership may be a founder of other business partnerships, except for cases provided for by legislative acts.

9. Excluded by the Law of the Republic of Kazakhstan dated 07/02/2018 No. 166-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication). Footnote. Article 58 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 N 154; dated 03/02/1998 N 211; dated July 10, 1998 N 282; dated 16.05.2003 N 416; dated 07/08/2005 N 72 (the order of enforcement see Article 2); dated 12.01.2007 N 225 (shall be enforced from the date of its official publication); dated January 20, 2010 № 239-IV; dated 12/28/2011 № 524-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated December 24, 2012 No. 60-V (shall be enforced upon expiration of ten calendar days after its first official publication); dated 07/02/2018 No. 166-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 59. Contribution to the authorized capital of a business partnership. Participant's share in the authorized capital and property of a business partnership

1. Contributions to the authorized capital of a business partnership can be money, securities, things, property rights, including rights to results of intellectual activity, and other property (with the exception of special financial companies created in accordance with the legislation of the Republic of Kazakhstan on project financing and securitization, organizations carrying out microfinance activities created in accordance with the legislation of the Republic of Kazakhstan on microfinance activities, collection agencies created in accordance with the legislation of the Republic of Kazakhstan on collection activities, and Islamic special financial companies created in accordance with the legislation of the Republic of Kazakhstan on the securities market, the authorized capital of which is formed exclusively in money).

Contributions of founders (participants) to the authorized capital in kind or in the form of property rights are valued in monetary form by agreement of all founders or by decision of the general meeting of all participants of the partnership. If the value of such a deposit exceeds an amount equivalent to twenty thousand monthly calculation indices, its assessment must be confirmed by an appraiser.

When re-registering a business partnership, the monetary value of the contribution of its participant can be confirmed by the accounting documents of the partnership or an audit report.

The founders (participants) of the partnership, for five years from the date of such assessment, bear joint liability to the creditors of the partnership to the extent of the amount by which the assessment of the contribution is overestimated.

In cases where the right to use property is transferred to the partnership as a contribution, the amount of this contribution is determined by the fee for the use of such property, calculated for the entire period specified in the constituent documents.

Contributions in the form of personal non-property rights and other intangible benefits are not allowed. It is also not allowed to make contributions by offsetting the claims of participants to the partnership, except in cases provided for by the legislative acts of the Republic of Kazakhstan.

2. The shares of all participants in the authorized capital and, accordingly, their shares in the value of the property of a business partnership (share in property) are proportional to their contributions to the authorized capital, unless otherwise provided by the constituent documents.

A participant in a business partnership has the right to pledge and (or) sell his share or part thereof in the property (authorized capital) of the partnership, unless otherwise provided by the legislative acts of the Republic of Kazakhstan or the constituent documents.

An agreement for the alienation (assignment) of the right of a retiring participant in a business partnership to a share in the property (authorized capital) of the partnership or its part, to which an individual is a party, is subject to notarization.

3. The procedure and timing for making contributions to the authorized capital, as well as liability for failure to fulfill obligations to form the authorized capital, are established by legislative acts and (or) constituent documents.

4. Reduction of the authorized capital of a business partnership is permitted after notification of all its creditors. The latter have the right in this case to demand early termination or fulfillment of the relevant obligations of the partnership and compensation for losses.

A decrease in the authorized capital in violation of the procedure established by this paragraph is grounds for liquidation of the partnership by a court decision based on an application from interested parties.

Footnote. Article 59 as amended by the laws of the Republic of Kazakhstan dated July 15, 1996 N 30; dated 07/11/1997 N 154; dated 03/02/1998 N 211; dated 20.02.2006 N 127 (for the order of enforcement, see st.2); dated 05.05.2006 N 139 (for the order of enforcement, see st.2); dated 12.02.2009 No. 133-IV (for the order of enforcement, see st.2); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 01/12/2012 № 539-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 26.11.2012 № 57-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 12/24/2012 № 60-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated November 24, 2015 No. 422-V (entered into effect from 01/01/2016); dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated January 21, 2019 No. 217-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 07/03/2019 No. 262-VI (effective from 01/01/2020); dated 05/24/2021 No. 43-VII (takes effect from 01/01/2022).

Article 60. Management of a business partnership

1. The supreme body of a business partnership is the general meeting of its participants.

In business partnerships, except for full and limited partnerships established by one person, the powers of the general meeting belong to its sole participant.

2. In a business partnership, an executive body is created (collegial and (or) sole), which carries out the current management of its activities and is accountable to the general meeting of its participants. The sole management body may not be elected from among its participants.

The following may be created as collegial bodies of the partnership:

1. board (directorate);

2. supervisory board;

3. other bodies in cases provided for by legislative acts or a decision of the general meeting of participants of a business partnership.

2-1. In cases where a business partnership is declared bankrupt or a rehabilitation procedure is applied and a temporary or bankrupt or rehabilitation manager is appointed in the manner prescribed by law, all powers to manage it are transferred, respectively, to the temporary or bankrupt or rehabilitation manager.

3. The competence of the bodies of a business partnership, the procedure for their election (appointment), as well as the procedure for making decisions by them are determined in accordance with this Code, legislative acts and constituent documents.

4. A business partnership may, to check and confirm the accuracy of financial statements, engage an audit organization that is not related by property interests to the partnership or its participants (external audit).

An audit of a business partnership must be carried out at any time at the request of one or more participants of the partnership at his (their) expense.

The procedure for conducting an audit of the activities of a business partnership is determined by legislation and the constituent documents of the partnership.

Footnote. Article 60 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 04/22/1998 № 221; dated 05.05.2006 № 139 (for the order of enforcement see Article 2 of the Law of the Republic of Kazakhstan № 139); dated 12.01.2007 № 225 (shall be enforced from the date of its official publication); dated 03/07/2014 No. 177-V (shall be enforced ten calendar days after the day of its first official publication).

Article 61. Rights and obligations of participants in a business partnership

1. Participants in a business partnership have the right:

1. participate in the management of the affairs of the business partnership in the manner determined by the constituent documents;

2. receive information about the activities of the business partnership and get acquainted with its documentation in the manner established by the constituent documents;

3. take part in the distribution of net income. The terms of the constituent documents providing for the exclusion of one or more participants from participation in the distribution of net income are void;

4. to receive, in the event of liquidation of a business partnership, a part of its property corresponding to their share in the property of the partnership remaining after settlements with creditors, or its value.

5. Excluded by the Law of the Republic of Kazakhstan dated 02.03.1998 No. 211.

Participants in a business partnership may have other rights provided for by legislative acts and constituent documents.

2. Participants in a business partnership are obliged to:

1. comply with the requirements of the constituent documents;

2. make contributions in the manner, amounts, methods and within the time limits provided for by the constituent documents;

3. not to disclose information that has been declared a trade secret by the business partnership.

Participants in a business partnership may also bear other responsibilities provided for by the legislative acts of the Republic of Kazakhstan and constituent documents.

Footnote. Article 61 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated 02/19/2007 № 230 (for the order of enforcement, see Article 2); dated 02.27.2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 62. Transformation of business partnerships

1. Business partnerships of one type may be transformed into business partnerships of another type or into joint-stock companies or production cooperatives by decision of the general meeting of participants in the cases and in the manner established by legislative acts.

2. When transforming a full or limited partnership into a joint-stock company, a limited or additional liability partnership, each general partner who has become a participant in the joint-stock company, limited or additional liability partnership shall, for two years, bear subsidiary liability with all his property for the obligations transferred to the joint-stock company, limited or additional liability partnership from the full or limited partnership. Alienation by a former general partner of his shares (shares) does not relieve him of such liability.

Footnote. Paragraph 1 of Article 62 was supplemented on the basis of the Law of the Republic of Kazakhstan dated July 15, 1996 No. 30 “On amendments and additions to some legislative acts of the Republic Kazakhstan". Amendments were made by the Law of the Republic of Kazakhstan dated July 16, 1999 No. 436.

2. General partnership

Article 63. Basic provisions on a general partnership

1. A partnership is recognized as a full partnership, the participants of which, if the property of the general partnership is insufficient, bear joint liability for its obligations with all the property belonging to them.

2. A citizen can be a participant in only one general partnership.

Article 64. Authorized capital of a general partnership

The size of the authorized capital of a general partnership is determined by its founders, but cannot be less than the minimum amount established by the legislative acts of the Republic of Kazakhstan.

The minimum size of the authorized capital of organizations engaged in microfinance activities, created in the form of a full partnership, is determined by the legislation of the Republic of Kazakhstan on microfinance activities.

The minimum amount of the authorized capital of collection agencies created in the form of a general partnership is determined by the legislation of the Republic of Kazakhstan on collection activities.

Footnote. Article 64 as amended by the Law of the Republic of Kazakhstan dated November 26, 2012 No. 57-V (shall be brought into force ten calendar days after its first official publication); as amended by the laws of the Republic of Kazakhstan dated 07/03/2019 No. 262-VI (takes effect from 01/01/2020); dated 05/24/2021 No. 43-VII (takes effect from 01/01/2022).

Article 65. Conducting affairs of a general partnership

1. The supreme body of a general partnership is the general meeting of participants. Decisions on internal issues of a general partnership are made by general agreement of all participants. The founding agreement of a partnership may provide for cases when a decision is made by a majority vote of the participants. Each participant in a general partnership has one vote, unless the constituent agreement provides for a different procedure for determining the number of votes of its participants. The constituent agreement may provide that the number of votes available to the participants is determined in proportion to their share in the authorized capital.

2. The management of a general partnership, taking into account the provisions of paragraph 1 of this article, is carried out by the executive bodies of the general partnership. The types, procedure for the formation of governing bodies and their competence are determined by the constituent documents.

3. A participant in a general partnership does not have the right, without the consent of the other participants, to carry out transactions on his own behalf and in his own interests or in the interests of third parties that are similar to those that constitute the subject of the partnership’s activities. If this rule is violated, the partnership has the right, at its choice, to demand from such participant either compensation for losses caused to the partnership, or the transfer to the partnership of all benefits acquired through such transactions.

4. The bodies of the general partnership, which are entrusted with the management of the affairs of the partnership, are obliged to provide all participants, upon their request, with complete information about their activities.

5. A participant who acted in the general interests, without authority, in cases where his actions are not approved by all other participants, has the right to demand from the partnership compensation for expenses incurred by him, provided that he proves that thanks to his actions, the partnership saved or, accordingly, acquired property that exceeds in value the expenses incurred by the partnership.

Footnote. Article 65 as amended by the Law of the Republic of Kazakhstan dated July 11, 1997 N 154.

Article 66. Transfer of a share (part of a share) of a participant in a general partnership

1. Transfer by a participant of his share (part of a share) to other participants of the general partnership or to third parties is possible only with the consent of all other participants.

2. When a share (part of a share) is transferred to a third party, the entire set of rights and obligations that belonged to the participant who retired from the general partnership is simultaneously transferred.

3. In the event of the death of a participant in a general partnership, the legal successor (heir) may, with the consent of all other participants, enter into the partnership.

4. The legal successor (heir) is liable for the debts of the participant to the general partnership, as well as for the debts of the partnership to third parties arising during the entire period of the partnership’s activities.

5. If the legal successor (heir) refuses to join the general partnership or the partnership refuses to accept the legal successor (heir), he is paid the value of the share in the property of the partnership belonging to him on the basis of legal succession, determined on the day of death of the participant.

In these cases, the amount of property of the partnership specified in the constituent agreement (charter) is correspondingly reduced within the period specified in the constituent agreement (charter), but no later than three months.

Article 67. Withdrawal of a participant from a general partnership

1. A participant in a general partnership may leave the partnership at any time by notifying the other participants about this no less than in the period provided for by legislative acts or the constituent agreement.

2. If, upon the withdrawal of a participant, the general partnership is preserved, the retiring participant is paid the value of his share in the property of the partnership, proportional to the contribution made, in accordance with the balance drawn up on the day of withdrawal. At the request of the participant and with the consent of the partnership, the contribution may be returned in whole or in part in kind. The retired participant is also paid his share of the net income received by the partnership in a given year for the period of his presence in the partnership in that year.

Property transferred by a partnership participant only for use is returned in kind without remuneration.

Footnote. Article 67 as amended by the Law of the Republic of Kazakhstan dated July 11, 1997 N 154.

Article 68. Exclusion of a participant from a general partnership

1. Participants in a general partnership have the right to demand in court the exclusion of one or more participants from the partnership by unanimous decision of the remaining participants and if there are good reasons for this, in particular, gross violation of their duties by him (them) or revealed inability to conduct business.

2. A participant expelled from a general partnership is paid the cost of part of the property in the manner prescribed by paragraph 2 of Article 67 of this Code.

Article 69. Levy of execution on the share of a participant in a general partnership

1. Foreclosure of a participant’s share in the property of a general partnership for his personal debts is permitted only if there is insufficient other property to cover the debts. Creditors of such a participant have the right to demand from the general partnership the allocation of part of the partnership’s property, in proportion to the debtor’s share in the authorized capital, in order to foreclose on this property. The part of the partnership's property subject to division or its value is determined according to the balance sheet drawn up at the time the creditors present the demand for division.

2. Foreclosure of a participant’s share in the property of a general partnership terminates his participation in the partnership and entails the consequences provided for in Articles 70 and 71 of this Code.

Footnote. Article 69 as amended by the Law of the Republic of Kazakhstan dated July 11, 1997 N 154.

Article 70. Liability of participants for debts of a general partnership

1. If, during the liquidation of a general partnership, it turns out that the available property is not enough to cover all its debts, its participants shall be jointly and severally liable for the missing part with all their property, which may be levied in accordance with legislative acts.

A participant in a general partnership is liable for the debts of the partnership, regardless of whether they arose after or before his entry into the partnership, unless otherwise provided by legislative acts.

2. A participant who has repaid the debts of a general partnership in a part exceeding his share in the property of the partnership has the right to file a recourse claim in the corresponding part against the remaining participants, who bear share liability to him in proportion to the size of their shares in the property of the partnership.

3. A participant who left the general partnership at his own request or was expelled from the partnership by a court decision, as well as the legal successor (heir) of a deceased participant who refused the offer to join the partnership, are liable for the obligations of the partnership that arose before the moment of their departure, for two years from the date of approval of the report on the activities of the partnership for the year in which they left the partnership.

4. A participant who has withdrawn from a general partnership by way of transferring a share to another participant or a third party, by way of foreclosure on his share in the property of the partnership by a creditor(s), as well as a legal successor (heir) of a deceased participant who was refused admission to the partnership by the other participants, are not liable for the obligations of the partnership.

5. After the termination of a general partnership, the participants are liable for the obligations of the partnership that arose before its termination for a period of two years from the date of termination of the partnership.

6. Agreements of participants that change the procedure for their liability for the obligations of the general partnership provided for by this article are void.

Footnote. Article 70 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 02.27.2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 71. Liquidation of a general partnership

1. In addition to the grounds specified in Article 49 of this Code, a general partnership is also liquidated in the case where the only participant remains in the partnership, if he does not transform the partnership within six months or does not accept new participants.

2. In cases of withdrawal or death of one of the participants in a general partnership, recognition of one of them as missing, incapacitated or partially incapacitated, or bankrupt, or a creditor of one of the participants forecloses on the property corresponding to his share in the authorized capital, the partnership may continue its activities if this is provided for by the constituent documents of the partnership or an agreement of the remaining participants.

3. If one of the participants left the partnership on the grounds specified in paragraph 2 of this article, the shares of the remaining participants in the authorized capital of the partnership increase in proportion to their contributions, unless otherwise provided by the constituent documents.

Footnote. Article 71 as amended by the Law of the Republic of Kazakhstan dated July 11, 1997 N 154.

3. Limited partnership

Article 72. Basic provisions on a limited partnership

1. A limited partnership is a partnership that includes, along with one or more participants who bear additional liability for the obligations of the partnership with all their property (general partners), also one or more participants whose liability is limited to the amount of their contribution to the property of the partnership (investors) and who do not participate in the partnership’s business activities.

2. The legal status of general partners participating in a limited partnership and their liability for the obligations of the partnership are determined by the rules on participants in a general partnership.

3. A citizen can be a general partner in only one limited partnership.

A general partner in a limited partnership cannot be a participant in the general partnership.

4. The rules of this Code on general partnerships apply to a limited partnership, since this does not contradict the provisions of this Code on limited partnerships.

Footnote. Article 72 as amended by the Law of the Republic of Kazakhstan dated 03/02/1998 N 211.

Article 73. Investor of a limited partnership

1. An investor in a limited partnership is obliged to make an initial contribution and additional contributions (contributions) in the amount, method and procedure provided for by the constituent documents.

2. An investor in a limited partnership has the right:

1. receive part of the net income of the partnership due to its share in the authorized capital, in the manner prescribed by the constituent documents;

2. get acquainted with the financial statements of the partnership, and also demand that it be possible to verify the correctness of its preparation;

3. transfer his share in the authorized capital or part thereof to another investor or a third party in the manner prescribed by the legislative acts of the Republic of Kazakhstan and the constituent documents of the partnership. The transfer by the investor of his entire share to another person terminates his participation in the partnership;

4. in the manner prescribed by the legislative acts of the Republic of Kazakhstan and the constituent documents, withdraw from the partnership.

The constituent documents of a limited partnership may also provide for other rights of the investor.

Waiver of the rights provided for by this Code and other legislative acts of the Republic of Kazakhstan for investors of a limited partnership, or their restrictions, including by agreement of investors and general partners, is void.

3. If the investor makes a transaction in the interests of a limited partnership without proper authority, then if his actions are approved by the partnership, it is liable for the transaction to the creditors in full. If approval is not received, the investor is liable to the third party independently with all his property, which, according to the law, can be foreclosed on.

Footnote. Article 73 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 74. Authorized capital of a limited partnership

1. The authorized capital of a limited partnership is made up of contributions from its participants. In the course of economic activity, the authorized capital may be changed. The authorized capital, without taking into account the contributions of investors, determines the share of general partners in the property of a limited partnership.

2. The size of the authorized capital is determined by the general partners of the limited partnership and cannot be less than the minimum amount established by legislative acts.

The minimum size of the authorized capital of organizations engaged in microfinance activities, created in the form of a limited partnership, is determined by the legislation of the Republic of Kazakhstan on microfinance activities.

The minimum size of the authorized capital of collection agencies created in the form of a limited partnership is determined by the legislation of the Republic of Kazakhstan on collection activities.

3. Reduction of the authorized capital of a limited partnership is permitted after notification of all its creditors. The latter have the right in this case to demand early termination or fulfillment of the relevant obligations and compensation for losses. A decrease in the authorized capital in violation of the procedure established by this article is the basis for the liquidation of a limited partnership by a court decision at the request of interested parties.

Footnote. Article 74 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated 26.11.2012 No. 57-V (shall be enforced after ten calendar days after its first official publication); dated 07/03/2019 No. 262-VI (effective from 01/01/2020); dated 05/24/2021 No. 43-VII (takes effect from 01/01/2022).

Article 75. Management of the affairs of a limited partnership

The management of the affairs of a limited partnership is carried out by the general partners. The procedure for managing and conducting the affairs of a limited partnership by its general partners is established by them according to the rules on general partnerships. Investors do not have the right to participate in the management of the affairs of a limited partnership, nor to act on its behalf, except by proxy. Investors of a limited partnership do not have the right to challenge the actions of their general partners in managing the affairs of the partnership.

Article 76. Termination of a limited partnership

1. A limited partnership is terminated upon the departure of all investors participating in it. General partners have the right, instead of liquidation, to transform a limited partnership into a general partnership. A limited partnership is also liquidated on the grounds provided for the liquidation of a general partnership.

2. When a limited partnership is liquidated, investors have a priority right over general partners to receive contributions from the property of the partnership remaining after satisfying the claims of its creditors. The property of the limited partnership remaining after this is distributed among the general partners and investors in proportion to their contributions to the property of the partnership, unless a different procedure is established by the constituent documents.

4. Limited Liability Partnership

Article 77. Basic provisions on limited liability partnerships

1. A limited liability partnership is a partnership established by one or several persons, the authorized capital of which is divided into shares of sizes determined by the constituent documents; Participants in a limited liability partnership are not liable for its obligations and bear the risk of losses associated with the activities of the partnership, within the limits of the value of their contributions. Exceptions to this rule may be provided for by this Code and legislative acts.

Participants in a limited liability partnership who have not made full contributions are jointly and severally liable for its obligations to the extent of the value of the unpaid part of the contribution of each participant.

2. The number of participants in a limited liability partnership is not limited.

A limited liability partnership cannot have another business partnership consisting of one person as its sole participant.

3. At the request of any of its participants, an audit of the activities of the limited liability partnership must be carried out.

Public reporting of a limited liability partnership is not required, except as required by law or the articles of incorporation.

4. A limited liability partnership may be voluntarily reorganized or liquidated by decision of its participants. Other grounds for reorganization and liquidation of a limited liability partnership are determined by this Code and legislative acts.

A limited liability partnership has the right to transform into another business partnership, a joint-stock company or a production cooperative.

5. Excluded by the Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

6. The legal status of a limited liability partnership, the rights and obligations of its participants are determined by this Code and legislative acts.

Footnote. Article 77 as amended by the laws of the Republic of Kazakhstan dated July 15, 1996 No. 30; dated 07/11/1997 No. 154; dated 03/02/1998 No. 211; dated 04/22/1998 № 221; dated July 16, 1999 No. 436; dated May 16, 2003 No. 416.

Article 78. Authorized capital of a limited liability partnership

The size of the authorized capital is determined by the founders (participants) of the limited liability partnership and cannot be less than the minimum amount established by the legislative acts of the Republic of Kazakhstan.

The minimum amount of the authorized capital of organizations engaged in microfinance activities, created in the form of a limited liability partnership, is determined by the legislation of the Republic of Kazakhstan on microfinance activities.

The minimum amount of the authorized capital of collection agencies created in the form of a limited liability partnership is determined by the legislation of the Republic of Kazakhstan on collection activities.

The minimum size of the authorized capital of payment organizations created in the form of a limited liability partnership is determined by the legislation of the Republic of Kazakhstan on payments and payment systems.

Footnote. Article 78 as amended by the Law of the Republic of Kazakhstan dated November 26, 2012 No. 57-V (shall be brought into force ten calendar days after its first official publication); as amended by the laws of the Republic of Kazakhstan dated 07/03/2019 No. 262-VI (takes effect from 01/01/2020); dated 07/03/2020 359-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication); dated 05/24/2021 No. 43-VII (takes effect from 01/01/2022).

Article 79. Management in a limited liability partnership

1. The competence of the bodies of the partnership, as well as the procedure for making decisions or speaking on behalf of the partnership, are determined in accordance with this Code, legislative acts and the charter of the partnership.

2. The exclusive competence of the general meeting of participants in a limited liability partnership includes:

1. a change in the charter of the partnership, including a change in the size of its authorized capital;

2. election (appointment) of members (members) of the executive body and early termination of their (his) powers, as well as making a decision on the transfer of the partnership or its property into trust management and determining the conditions for such transfer;

3. approval of the financial statements of the partnership and distribution of its net income;

4. decision on reorganization or liquidation of the partnership;

5. election and early termination of powers of the supervisory board and (or) the audit commission (auditor) of the partnership, as well as approval of reports and conclusions of the audit commission (auditor) of the partnership;

6. approval of internal rules, procedures for their adoption and other documents regulating the internal activities of the partnership, except for cases provided for by the legislative acts of the Republic of Kazakhstan;

7. a decision on the participation of the partnership in other business partnerships, as well as in non-profit associations;

8. appointment of a liquidation commission and approval of liquidation balance sheets;

9. a decision on the forced purchase of a share from a participant in a limited liability partnership in accordance with Article 82 of this Code.

3. Issues within the exclusive competence of the general meeting of participants of the partnership cannot be transferred to them for decision by the executive body of the partnership, unless otherwise established by the laws of the Republic of Kazakhstan.

Footnote. Article 79 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated 04/22/1998 № 221; dated 12.01.2007 № 225 (shall be enforced from the date of its official publication); dated 19.02.2007 № 230 (for the order of enforcement see Art. 2); dated 10/28/2019 No. 268-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 80. Transfer of a share in the authorized capital of a limited liability partnership to another person

1. A participant in a limited liability partnership has the right to sell or otherwise assign his share in the authorized capital of the partnership or a part thereof at his choice to one or more participants of this partnership, except for the cases provided for by this Code.

2. Alienation by a participant of a limited liability partnership of his share (part thereof) to third parties is permitted, unless otherwise provided by the constituent documents of the partnership or legislative acts.

Participants in a limited liability partnership have a preferential right over third parties to purchase a share or part thereof, with the exception of cases provided for by this Code and the Law of the Republic of Kazakhstan “On Limited and Additional Liability Partnerships”. Unless otherwise provided for by the constituent documents or agreement of the participants of the partnership, the pre-emptive right to purchase a share (part thereof) is exercised by the participants in proportion to the size of their shares in the authorized capital of the partnership.

When selling a share (part thereof) in violation of the pre-emptive right, any participant in a limited liability partnership has the right, within three months from the date of sale, to demand in court the transfer of the rights and obligations of the buyer to him.

3. If, in accordance with the constituent documents of a limited liability partnership, alienation of a participant’s share (part thereof) to third parties is impossible, and other participants in the partnership refuse to purchase it, the partnership is obliged to pay the participant its actual value or give him in kind property corresponding to such value.

4. The share of a participant in a limited liability partnership may be alienated before it is fully paid only to the extent that it has already been paid.

5. In the event of the acquisition of a participant’s share (part thereof) by the limited liability partnership itself, it is obliged to sell it to other participants or third parties within the time frame and in the manner prescribed by legislative acts and the constituent documents of the partnership, or to reduce its authorized capital. During this period, the distribution of net income, as well as voting in the highest body, is carried out without taking into account the share acquired by the limited liability partnership.

6. Shares in the authorized capital of a limited liability partnership pass to the heirs of citizens and to the legal successors of legal entities that were participants in the partnership, unless the constituent documents of the partnership provide that such a transfer is permitted only with the consent of the remaining participants of the partnership. Refusal to consent to the transfer of a share entails the obligation of the partnership to pay the heirs (legal successors) of the participant its actual value or to give them property in kind for such value in the manner and under the conditions provided for by legislative acts and the constituent documents of the partnership.

Legislative acts may provide for the specifics of the transfer of shares to legal successors of legal entities.

Footnote. Article 80 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated 07.08.2007 № 321 (shall be enforced from the date of its official publication); dated 04/21/2016 No. 504-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 81. Additional contributions of participants of a limited liability partnership

Unless otherwise provided by the charter of a limited liability partnership, the general meeting of participants may decide on the participants to make additional contributions to the property of the partnership. The decision is made by a three-quarters majority vote of all participants in the partnership.

Footnote. Article 81 as amended by the Law of the Republic of Kazakhstan dated April 22, 1998 No. 221.

Article 82. Forced redemption of a share from a participant in a limited liability partnership

If a participant in a limited liability partnership violates his obligations to the partnership established by legislative acts or constituent documents, the partnership, in accordance with the decision of the general meeting, has the right to demand in court the forced redemption of the share of such participant in the manner established by the Law of the Republic of Kazakhstan “On Limited and Additional Liability Partnerships.”

Footnote. Article 82 as amended by the Law of the Republic of Kazakhstan dated 03/02/1998 No. 211; as amended by the Law of the Republic of Kazakhstan dated January 21, 2019 No. 217-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 83. Foreclosure of the share of a participant in a limited liability partnership

If the property of a participant in a limited liability partnership is insufficient to cover personal debts, creditors may require, in accordance with the established procedure, the allocation of the share of the debtor participant.

Footnote. Article 83 as amended by the Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

5. Partnership with additional liability

Article 84. Basic provisions on a partnership with additional liability

1. A partnership with additional liability is a partnership whose participants are liable for its obligations with their contributions to the authorized capital, and if these amounts are insufficient, with additional property belonging to them in an amount that is a multiple of their contributions.

2. The maximum amount of liability of participants is provided for in the charter.

In the event of bankruptcy of one of the participants, his liability for the obligations of the partnership is distributed among the remaining participants in proportion to their contributions, unless a different procedure for the distribution of liability is provided for by the constituent documents.

3. The rules of this Code on limited liability partnerships apply to a partnership with additional liability, unless otherwise provided by this article.

Footnote. Article 84 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 04/22/1998 No. 221.

III. Joint stock company

Footnote. Subsection 6 should be considered part III - Law of the Republic of Kazakhstan dated July 10, 1998 No. 282.

Article 85. Concept of a joint stock company

1. A joint stock company is a legal entity that issues shares in order to raise funds to carry out its activities. Shareholders of a joint stock company are not liable for its obligations and bear the risk of losses associated with the activities of the company, within the limits of the value of the shares they own, except for cases provided for by legislative acts.

2. A joint stock company has property separate from the property of its participants, is liable for its obligations within the limits of its property and is not liable for the obligations of its participants.

3. A joint stock company may be created by one person or consist of one person in the event of the acquisition by one shareholder of all shares of the company, unless otherwise provided by legislative acts.

4. The legal status of a joint-stock company, the rights and obligations of shareholders are determined in accordance with this Code and legislative acts. Features of the legal status of joint stock companies created through the privatization of state-owned enterprises or the controlling stake of which belongs to the state are determined by the legislative acts of the Republic of Kazakhstan.

5. In cases provided for by law, non-profit organizations may be created in the organizational and legal form of a joint stock company.

Footnote. Article 85 as amended by the laws of the Republic of Kazakhstan dated June 19, 1997 No. 134; dated 07/11/1997 No. 154; dated 03/02/1998 No. 211; dated July 10, 1998 No. 282; dated 10/13/2003 № 486; dated December 28, 2011 No. 524-IV (shall be enforced ten calendar days after its first official publication).

Article 86. Open and closed joint-stock companies

Footnote. Article 86 was excluded by the Law of the Republic of Kazakhstan dated May 16, 2003 No. 416.

Article 87. Constituent documents of a joint-stock company

1. The constituent documents of a joint-stock company are the constituent agreement (decision of the sole founder) and the charter.

The constituent documents of a joint stock company must contain information specified by this Code and other legislative acts of the Republic of Kazakhstan.

The constituent documents of a joint stock company are subject to notarization.

2. The validity of the constituent agreement (decision of the sole founder) is terminated from the day of state registration of the issue of authorized shares.

3. The procedure for approving the charter of a joint stock company is established by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 87 as amended by the Law of the Republic of Kazakhstan dated May 16, 2003 No. 416.

Article 88. Authorized capital of a joint-stock company

The minimum size and procedure for forming the authorized capital of a joint-stock company, as well as the procedure for increasing it, are determined by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 88 as amended by the Law of the Republic of Kazakhstan dated May 16, 2003 No. 416; as amended by the Law of the Republic of Kazakhstan dated 07/08/2005 No. 72 (the order of enforcement see Article 2).

Article 89. Increase in declared and issued (paid) authorized capital

Footnote. Article 89 was excluded by the Law of the Republic of Kazakhstan dated May 16, 2003 No. 416.

Article 90. Reduction of declared and issued (paid) authorized capital

Footnote. Article 90 is excluded by the Law of the Republic of Kazakhstan dated May 16, 2003 No. 416.

Article 91. Issue and placement of securities

1. The types of securities issued by a joint-stock company are determined by legislative acts.

2. The procedure for state registration of the issue of declared shares and their placement is determined in accordance with the legislative acts of the Republic of Kazakhstan.

3. A joint stock company has the right to issue secured bonds and unsecured bonds, except for cases provided for by the laws of the Republic of Kazakhstan. The conditions and procedure for issuing bonds are determined by the legislation of the Republic of Kazakhstan on the securities market.

4. The form, method and procedure for paying income on securities are determined by the charter of the joint-stock company or prospectuses for the issue of securities, taking into account the specifics provided for by legislative acts.

5. A joint stock company does not have the right to pay dividends on the company’s shares:

1. if the amount of equity capital is negative or if the amount of equity capital of the company becomes negative as a result of the payment of dividends on its shares;

2. if it meets the signs of insolvency or insolvency in accordance with the legislation of the Republic of Kazakhstan on rehabilitation and bankruptcy, or the specified signs appear in the company as a result of the payment of dividends on its shares.

Legislative acts of the Republic of Kazakhstan may provide for other grounds prohibiting the payment of dividends on shares by a joint-stock company.

6. A joint stock company has the right to issue derivative securities, options and convertible securities in the manner determined by law.

Footnote. Article 91 as amended by the Law of the Republic of Kazakhstan dated July 10, 1998 No. 282; as amended by the laws of the Republic of Kazakhstan dated May 16, 2003 No. 416; dated 02/20/2006 No. 127 (for the order of enforcement, see st.2); dated 02/19/2007 № 230 (for the order of enforcement, see st.2); dated July 15, 2010 No. 338-IV (for the order of enforcement, see st.2); dated 03/07/2014 No. 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated July 12, 2022 No. 138-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 92. Management of a joint stock company

1. The supreme body of a joint stock company is the general meeting of its shareholders.

2. The exclusive competence of the general meeting of shareholders is determined by legislative acts.

3. Resolution of issues falling within the exclusive competence of the general meeting of shareholders cannot be transferred to other bodies of the joint-stock company.

4. A board of directors is created in a joint-stock company, which exercises general management of the company’s activities, with the exception of resolving issues referred to by this Code, legislative acts and the charter of the joint-stock company as the exclusive competence of the general meeting of shareholders. Issues referred by this Code, legislative acts and the charter of the joint-stock company to the exclusive competence of the board of directors cannot be transferred for decision to the executive body of the joint-stock company.

5. The executive body of a joint stock company can be collegial (board) or individual (director, general director, president). He carries out the current management of the activities of the joint-stock company and is accountable to the board of directors and the general meeting of shareholders.

The competence of the executive body of a joint stock company includes the resolution of all issues that do not constitute the exclusive competence of other bodies of the company, as determined by law or constituent documents.

6. Other bodies may be created in a joint-stock company in accordance with legislative acts.

6-1. In cases where a joint stock company is declared bankrupt or a rehabilitation procedure is applied and a temporary or bankrupt or rehabilitation manager is appointed in accordance with the procedure established by law, all powers to manage it are transferred, respectively, to the temporary or bankrupt or rehabilitation manager.

7. The competence of the bodies of a joint-stock company, as well as the procedure for making decisions and speaking on behalf of the company, are determined in accordance with this Code, legislation and constituent documents.

8. (deleted) Footnote. Article 92 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated July 10, 1998 No. 282; dated 05/16/2003 № 416; dated 12/28/2011 № 524-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 03/07/2014 No. 177-V (shall be enforced ten calendar days after the day of its first official publication).

Article 93. Reorganization and liquidation of a joint-stock company

1. A joint stock company may be reorganized or liquidated by decision of the meeting of shareholders. Other grounds and procedure for reorganization and liquidation of a joint-stock company are determined by this Code and other legislative acts.

2. A joint stock company has the right to transform into a non-profit organization in the form of a higher scientific organization in accordance with the Law of the Republic of Kazakhstan “On Science and Technology Policy”, into a business partnership, production cooperative or autonomous educational organization in accordance with Law of the Republic of Kazakhstan "On the status of "Nazarbayev University", "Nazarbayev Intellectual Schools" and "Nazarbayev Foundation", as well as in an autonomous cluster fund in accordance with Law of the Republic of Kazakhstan “On the innovation cluster “Astana Hub”.

Footnote. Article 93 as amended by the Law of the Republic of Kazakhstan dated July 15, 1996 No. 30; as amended by the laws of the Republic of Kazakhstan dated May 16, 2003 No. 416; dated 01/19/2011 № 395-IV (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 10.06.2014 No. 208-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 07/01/2024 No. 104-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication); dated 09/27/2025 No. 220-VIII (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

IV. Subsidiary and dependent

joint stock company

Footnote. Subsection seven should be considered part IV - Law of the Republic of Kazakhstan dated July 10, 1998 No. 282.

Article 94. Subsidiary organization

1. A subsidiary organization is a legal entity, the decisions of which can be determined by another legal entity (hereinafter referred to as the main organization) on the basis of the presence of a dominant share in the authorized capital or an agreement concluded between them, or otherwise.

2. A subsidiary is not liable for the debts of its parent organization.

The main organization, which, under an agreement with a subsidiary organization (or otherwise), has the right to give the latter instructions that are binding on it, is liable subsidiarily with the subsidiary organization for transactions concluded by the latter in pursuance of such instructions.

In the event of bankruptcy of a subsidiary through the fault of the main organization, the latter bears subsidiary liability for its debts.

A subsidiary cannot acquire shares of the parent organization, with the exception of financial organizations that have the right to own shares of the parent organization in the amount of no more than ten percent of the voting shares of such organization.

3. Participants in a subsidiary organization have the right to demand compensation from the main organization for losses caused through its fault to the subsidiary organization, unless otherwise established by legislative acts.

4. Features of the position of subsidiaries not provided for in this article are determined by legislative acts.

Footnote. Article 94 as amended by the Law of the Republic of Kazakhstan dated July 10, 1998 No. 282; as amended by the laws of the Republic of Kazakhstan dated May 16, 2003 No. 416; dated 04/22/2015 No. 308-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 95. Dependent joint-stock company

1. A joint stock company is recognized as dependent if another (participating, dominant) legal entity has more than twenty percent of its voting shares.

2. Excluded by the Law of the Republic of Kazakhstan dated December 28, 2011 No. 524-IV (shall be enforced upon the expiration of ten calendar days after its first official publication).

3. Excluded by the Law of the Republic of Kazakhstan dated December 28, 2011 No. 524-IV (shall be enforced upon the expiration of ten calendar days after its first official publication).

4. Features of the position of joint stock companies dependent and mutually participating in each other’s authorized capitals, not provided for by this article, are determined by legislative acts.

5. The participating (predominant) legal entity is obliged, in the manner prescribed by law, to publish information about its acquisition of more than twenty percent of the voting shares of the joint-stock company.

Footnote. Article 95 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated July 10, 1998 No. 282; dated 05/16/2003 № 416; dated December 28, 2011 No. 524-IV (shall be enforced ten calendar days after its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

V. Production cooperative

Article 96. General provisions on production cooperatives

1. A production cooperative is recognized as a voluntary association of citizens on the basis of membership for joint entrepreneurial activities based on their personal labor participation and the pooling of property contributions by its members.

2. There must be at least two members of the cooperative.

3. Members of a production cooperative bear additional (subsidiary) liability for the obligations of the cooperative in the amount and manner provided for by the Law on Production Cooperatives.

4. The legal status of the production cooperative and its members is determined in accordance with this Code and legislative acts.

5. The legal status of an agricultural cooperative formed in the form of a production cooperative, as well as the legal status, rights and obligations of its members are determined by this Code and other laws of the Republic of Kazakhstan, with the exception of cases provided for by the Law of the Republic of Kazakhstan “On Agricultural Cooperatives”.

Footnote. Article 96 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 10.29.2015 № 373-V (entered into effect from 01/01/2016).

Article 97. Charter of a production cooperative

The charter of a production cooperative must contain, in addition to the information specified in paragraph 5 of Article 41 of this Code, conditions on the size of the share of members of the cooperative; on the composition and procedure for making contributions by members of the cooperative and their responsibility for violating the obligation to make a contribution; on the nature and procedure for the labor participation of its members in the activities of the cooperative and their responsibility for violating the obligation of personal labor participation; on the procedure for distributing the net income of the cooperative; on the composition and competence of the management bodies of the cooperative and the procedure for their decision-making, including on issues on which decisions are made unanimously or by a qualified majority of votes.

Footnote. Article 97 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211.

Article 98. Property of a production cooperative

1. Property owned by a production cooperative is divided into shares of its members in proportion to their contributions, unless otherwise provided by the charter of the cooperative.

2. The net income of the cooperative is distributed among its members in accordance with their labor participation, unless a different procedure is provided for by the charter of the cooperative.

3. In the event of liquidation of a production cooperative or withdrawal of a member of the cooperative, the latter has the right to allocate his share.

Footnote. Article 98 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211.

Article 99. Management of a production cooperative

1. The supreme body of a production cooperative is the general meeting of its members.

A supervisory board may be created in a production cooperative, which exercises control over the activities of the executive body of the cooperative. Members of the supervisory board do not have the right to act on behalf of the production cooperative.

The executive body of the cooperative is the board or chairman of the cooperative.

The executive body carries out the current management of the activities of the cooperative and is accountable to the supervisory board and the general meeting of members of the cooperative.

Only members of the cooperative can be members of the supervisory board and board of a production cooperative. A member of a cooperative cannot simultaneously be a member of the supervisory board and a member of the board (chairman of the cooperative).

2. The competence of the management bodies of a production cooperative, as well as the procedure for making decisions and speaking on behalf of the cooperative, are determined by legislative acts and constituent documents.

3. The exclusive competence of the general meeting of members of a production cooperative includes:

1. changing the charter of the cooperative;

2. formation of the executive body, audit bodies and supervisory board and recall of their members;

3. admission and exclusion of members of the cooperative;

4. approval of the financial statements of the cooperative and distribution of its net income;

5. decision on reorganization and liquidation of the cooperative.

Legislative acts and constituent documents may also include the resolution of other issues within the exclusive competence of the general meeting.

Issues falling within the exclusive competence of the general meeting or supervisory board of the cooperative cannot be referred by them to the decision of the executive body of the cooperative.

3-1. In cases where a production cooperative is declared bankrupt or a rehabilitation procedure is applied and a temporary or bankrupt or rehabilitation manager is appointed in the manner prescribed by law, all powers to manage it are transferred, respectively, to the temporary or bankrupt or rehabilitation manager.

4. A member of the cooperative has one vote when making decisions at the general meeting.

Footnote. Article 99 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/07/2014 No. 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 100. Termination of membership in a production cooperative

1. A member of a production cooperative has the right to leave the cooperative at his own discretion. In this case, he must be paid or given his share, as well as other payments provided for by the charter.

The issuance of shares and other property to the withdrawing member of the cooperative is made at the end of the reporting period and approval of the financial statements of the cooperative.

2. A member of a production cooperative may be expelled from the cooperative by decision of the general meeting in the event of failure to fulfill or improper performance of the duties assigned to him by the charter of the cooperative, as well as in other cases provided for by legislative acts and constituent documents.

Expulsion from membership in a production cooperative may be appealed in court.

A member of a production cooperative may be expelled from it by decision of the general meeting in connection with membership in a similar cooperative.

A member of a production cooperative expelled from it has the right to receive a share and other payments provided for by the charter of the cooperative, in accordance with paragraph 1 of this article.

3. A member of a production cooperative has the right to transfer his share or part thereof to another member of the cooperative, unless otherwise provided by this Code, other legislative acts and constituent documents.

Transfer of a share (part thereof) to a citizen who is not a member of a production cooperative is permitted only with the consent of the cooperative, unless otherwise provided by legislative acts. In this case, other members of the cooperative enjoy the preemptive right to purchase such a share (part thereof), except for the cases provided for by this Code.

4. In the event of the death of a member of a production cooperative, his heirs may be accepted as members of the cooperative, unless otherwise provided by the charter of the cooperative. If the heir of a deceased member of the cooperative refuses to join the cooperative or the cooperative refuses to accept the heir, he is paid a share in the property proportional to the share of the deceased member of the cooperative, as well as the portion of the net income of the cooperative due to the deceased and remuneration for personal labor participation in the activities of the cooperative.

5. Foreclosure of a share of a member of a production cooperative for his personal debts is allowed only if there is insufficient other property to cover such debts in the manner prescribed by legislative acts and the constituent documents of the cooperative.

Footnote. Article 100 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 08/07/2007 N 321 (shall be enforced from the date of its official publication).

Article 101. Reorganization and liquidation of a production cooperative

1. A production cooperative may be voluntarily reorganized or liquidated by decision of the general meeting of its members.

Other grounds and procedures for the reorganization and liquidation of a production cooperative are determined by this Code and other legislative acts.

2. By unanimous decision of its members, a production cooperative may be transformed into a business partnership.

VI. State enterprise

Article 102. Basic provisions on a state enterprise

1. State-owned enterprises include:

1. based on the right of economic management;

2. based on the right of operational management (state-owned enterprise).

2. The property of a state enterprise is indivisible and cannot be distributed among deposits (shares, shares), including among employees of the enterprise.

3. The corporate name of state enterprises must contain an indication of the owner of its property.

RCPI note! This version of paragraph 4 is valid from 01/01/2018 for cities of regional significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 07/11/2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

4. A state enterprise is created, liquidated and reorganized in accordance with the laws of the Republic of Kazakhstan.

RCPI note! This version of the first part of paragraph 5 is valid from 01.01.2018 for cities of regional significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 11.07.2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

5. The body of a state enterprise is the head, who is appointed in the manner determined by the laws of the Republic of Kazakhstan.

In cases provided for by the legislative act of the Republic of Kazakhstan on state property, another body, in addition to the head of the state enterprise, may act as a body of a state enterprise.

5-1. In cases where a state enterprise is declared bankrupt or a rehabilitation procedure is applied and a temporary or bankrupt or rehabilitation manager is appointed in the manner prescribed by law, all powers to manage it are transferred, respectively, to the temporary or bankrupt or rehabilitation manager.

6. (deleted)

7. The legal status of a state enterprise is determined by this Code and other legislative acts.

Footnote. Article 102 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 01.03.2011 № 414-IV (shall be enforced from the date of its first official publication); dated 03/07/2014 No. 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated July 11, 2017 No. 90-VI (the order of enforcement see clause 1) clause 1, article 2).

Article 103. Enterprise based on the right of economic management

1. The constituent document of an enterprise based on the right of economic management is its charter, approved by the founder.

2. An enterprise based on the right of economic management is liable for its obligations with all the property belonging to it.

An enterprise based on the right of economic management is not liable for the obligations of the state.

The state is not liable for the obligations of an enterprise based on the right of economic management, except for the cases provided for by this Code and other legislative acts.

Footnote. Article 103 as amended by the Law of the Republic of Kazakhstan dated 03/02/1998 N 211.

Article 104. State-owned enterprise

1. A state enterprise is an enterprise that owns state property with the right of operational management.

RCPI note! This version of paragraph 2 is valid from 01/01/2018 for cities of district significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 07/11/2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

2. A state-owned enterprise is created by decision of the Government of the Republic of Kazakhstan or a local executive body or the office of the akim of a city of regional significance, a village, a township, a rural district in accordance with the laws of the Republic of Kazakhstan.

3. The constituent document of a state-owned enterprise is its charter, approved by the founder.

4. The corporate name of an enterprise based on the right of operational management must contain an indication that the enterprise is state-owned.

5. The economic activities of a state-owned enterprise are determined by its goals and objectives, fixed in the charter.

6. The Republic of Kazakhstan or an administrative-territorial unit bears subsidiary liability for the obligations of a state-owned enterprise. For contractual obligations, liability arises in the manner established by the legislative act of the Republic of Kazakhstan on state property.

Footnote. Article 104 as amended by the laws of the Republic of Kazakhstan dated December 16, 1998 N 320; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated July 11, 2017 No. 90-VI (for the order of enforcement, see clause 1) clause 1, article 2).

VII. Non-profit organizations

Article 105. Establishment

1. An institution is recognized as an organization created and financed by its founder, unless otherwise provided by legislative acts of the Republic of Kazakhstan, for the implementation of managerial, socio-cultural or other functions of a non-commercial nature.

RCPI note! This version of paragraph 2 is valid from 01/01/2018 for cities of regional significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 07/11/2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

2. A state institution is recognized as an institution created by the state in accordance with the Constitution of the Republic of Kazakhstan and the laws of the Republic of Kazakhstan or legal acts of the President of the Republic of Kazakhstan, the Government of the Republic of Kazakhstan and local executive bodies of regions, cities of republican significance, the capital, districts, cities of regional significance, as well as the offices of akims of district cities values, villages, towns, rural districts and contained only at the expense of the budget or budget (cost estimates) of the National Bank of the Republic of Kazakhstan, unless additional sources of financing are established by the laws of the Republic of Kazakhstan.

3. The acceptance of contractual obligations by a state institution is carried out in accordance with the Budget Code of the Republic of Kazakhstan.

4. The legal status of institutions is determined by this Code, the legislative act of the Republic of Kazakhstan on state property and other legislative acts of the Republic of Kazakhstan.

Footnote. Article 105 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); as amended by the Law of the Republic of Kazakhstan dated July 11, 2017 No. 90-VI (the order of enforcement see clause 1) clause 1 article 2).

Article 106. Public association

1. Public associations in the Republic of Kazakhstan are political parties, trade unions and other associations of citizens created on a voluntary basis to achieve common goals that do not contradict the law, unless otherwise provided by law.

Features of the creation of public associations of individuals operating in the financial market and participation in them are established by the legislative acts of the Republic of Kazakhstan.

Members (participants) of public associations do not have rights to the property transferred by them to these associations, including membership fees, unless otherwise provided by the legislation of the Republic of Kazakhstan on self-regulation. They are not liable for the obligations of public associations in which they participate as members (participants), and these associations are not liable for the obligations of their members (participants), unless otherwise provided by the legislation of the Republic of Kazakhstan on self-regulation.

2. • 6. Excluded by the Law of the Republic of Kazakhstan dated 02.03.1998 No. 211.

3. The property of a public association liquidated by decision of the congress (conference) or general meeting is directed to the purposes provided for by its charter.

The property of a public association liquidated by a court decision is used in accordance with this Code or other legislative acts.

8. The legal status of a public association is determined in accordance with this Code by legislative acts.

Footnote. Article 106 as amended by the Decree of the President of the Republic of Kazakhstan, having the force of Law, dated 05.10.1995 No. 2489; laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated July 15, 2010 No. 338-IV (for the order of enforcement, see st.2); dated 12.01.2012 No. 537-IV (shall be enforced 10 calendar days after its first official publication); dated 12/21/2023 No. 49-VIII (shall be enforced ten calendar days after the day of its first official publication).

Article 107. Fund

1. The Foundation is recognized as a non-profit organization that does not have a membership, established by citizens and (or) legal entities on the basis of voluntary property contributions, pursuing social, charitable, cultural, educational and other socially beneficial goals.

2. The foundation is a legal entity, represented in civil circulation by the foundation’s bodies, and has an independent balance sheet and bank account.

3. Property transferred to the foundation by its founders is the property of the foundation.

The founders of the fund do not have property rights to the property of the fund.

4. The financial source of the fund is money, as well as other property of the founders, voluntary donations and other legal income.

5. The procedure for managing the fund and the procedure for forming its bodies are determined by its charter, approved by the founders.

The charter of the fund, in addition to the information contained in clause 5 of Article 41 of this Code, must contain instructions on the bodies of the fund, on the procedure for appointing officials of the fund and their dismissal, and the fate of the fund’s property in the event of its liquidation.

6. The Foundation is obliged to annually publish reports on the use of its property in official publications.

7. By court decision, the fund may be liquidated in the following cases:

1. if the fund’s property is insufficient to achieve its goals and the likelihood of obtaining the necessary property is unrealistic;

2. if the goals of the fund cannot be achieved and the necessary changes to the goals of the fund cannot be made;

3. in case the foundation deviates in its activities from the goals provided for by the charter;

4. in other cases provided for by legislative acts or constituent documents.

8. The property remaining after the liquidation of the fund is directed to the purposes provided for by its charter.

Footnote. Article 107 as amended by the Law of the Republic of Kazakhstan dated April 27, 2012 No. 15-V (shall be enforced upon the expiration of ten calendar days after its first official publication); as amended by the Law of the Republic of Kazakhstan dated November 16, 2015 No. 403-V (shall be brought into force ten calendar days after the day of its first official publication).

Article 108. Consumer cooperative

1. A consumer cooperative is recognized as a voluntary association of citizens on the basis of membership to satisfy the material and other needs of the participants, carried out through the pooling of property (share) contributions by its members.

In cases provided for by legislative acts, legal entities may join a consumer cooperative.

2. Members of a consumer cooperative are obliged to cover the resulting losses through additional contributions within three months after the approval of the annual balance sheet. If this obligation is not fulfilled, the cooperative may be liquidated in court at the request of creditors.

Members of a consumer cooperative jointly and severally bear subsidiary liability for its obligations to the extent of the unpaid portion of the additional contribution of members of the cooperative.

3. The charter of a consumer cooperative must contain, in addition to the information specified in paragraph 5 of Article 41 of this Code, conditions on the size of shares of members of the cooperative; on the composition and procedure for contributing shares by members of the cooperative and their responsibility for violating the obligation to contribute shares; on the composition and competence of the management bodies of the cooperative and the procedure for their decision-making, including on issues on which decisions are made unanimously or by a qualified majority of votes; on the procedure for covering losses incurred by members of the cooperative.

4. Income received by a consumer cooperative cannot be distributed among its members and is used for statutory purposes.

5. In the event of liquidation of a consumer cooperative or withdrawal of a member of the cooperative, he has the right to allocate his share in the property of the consumer cooperative, proportional to his share.

In the event of the death of a member of a consumer cooperative, his heirs have the priority right to be accepted as members of the cooperative, unless otherwise provided by the charter of the cooperative. In the latter case, the cooperative pays the heirs a share in the property of the consumer cooperative, proportional to its share.

6. The legal status of a consumer cooperative, as well as the rights and obligations of its members, are determined in accordance with this Code by legislative acts.

7. Excluded by the Law of the Republic of Kazakhstan dated October 29, 2015 No. 373-V (put into effect into force from 01/01/2016).

8. Features of the activities of consumer cooperatives - mutual insurance societies are determined by the legislative acts of the Republic of Kazakhstan.

Footnote. Paragraph 1 of Article 108 is supplemented by the second paragraph - Law of the Republic of Kazakhstan dated March 2, 1998 No. 211; as amended by the laws of the Republic of Kazakhstan dated July 5, 2006 No. 164 (the order of enforcement see. st.2); dated 10.29.2015 № 373-V (entered into effect from 01/01/2016).

Article 109. Religious association

1. A religious association is recognized as a voluntary association of citizens who, in accordance with the procedure established by legislative acts, have united on the basis of their common interests to satisfy spiritual needs.

2. (deleted)

3. Religious associations in the Republic of Kazakhstan that have leadership centers outside the republic are subject to registration with the justice authorities. The charters (regulations) of governing centers may be used as the basis for the charters (regulations) of such religious associations, if they do not contradict the legislation of the Republic of Kazakhstan.

4 - 8. (excluded)

9. A religious association has the right of ownership of property acquired or created by it at its own expense, donated by citizens, organizations or transferred by the state and acquired on other grounds that do not contradict legislative acts.

10. Participants (members) of a religious association do not retain rights to the property transferred by them to this organization, including membership fees. They are not liable for the obligations of a religious association, and a religious association is not liable for the obligations of its members.

11. Features of the legal status of a religious association are determined in accordance with this Code and the legislative acts of the Republic of Kazakhstan.

Footnote. Article 109 as amended by the Decree of the President of the Republic of Kazakhstan, having the force of Law, dated 05.10.1995 No. 2489. Clauses 2, 4-8 are excluded by the Law of the Republic of Kazakhstan dated 03/02/1998 No. 211.

Article 110. Association of individual entrepreneurs and (or) legal entities in the form of an association (union)

1. Individual entrepreneurs and (or) legal entities may create associations (unions) for the purpose of coordinating their business activities, as well as representing and protecting common interests.

Features of the creation of associations (unions) of legal entities operating in the financial market and participation in them are established by the legislative acts of the Republic of Kazakhstan.

2. Public associations and other non-profit organizations, including institutions, may voluntarily unite into associations (unions) of these organizations.

3. The association (union) is a non-profit organization.

4. Members of the association (union) retain their independence.

5. The association (union) is not responsible for the obligations of its members, unless otherwise provided by the laws of the Republic of Kazakhstan and the constituent documents. Members of an association (union) bear subsidiary liability for its obligations in the amount and manner provided for by the constituent documents of the association (union), unless otherwise established by the laws of the Republic of Kazakhstan.

Footnote. Article 110 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 05/16/2003 N 416; dated 12.01.2007 No. 225 (shall be enforced from the date of its official publication); dated 12.11.2015 № 391-V (shall be put into effect six months after the date of its first official publication).

Paragraph 3. PARTICIPATION OF THE STATE AND ADMINISTRATIVE-TERRITORIAL UNIT IN RELATIONS GOVERNED BY CIVIL LEGISLATION

Article 111. Participation of the Republic of Kazakhstan in civil legal relations

1. The Republic of Kazakhstan acts in relations regulated by civil legislation on an equal basis with other participants in these relations.

2. On behalf of the Republic of Kazakhstan, state bodies of the Republic of Kazakhstan may, through their actions, acquire and exercise property and personal non-property rights and obligations, and appear in court, within the framework of their competence established by the legislative acts of the Republic of Kazakhstan, regulations or other acts defining the status of these bodies.

In cases and in the manner provided for by the legislation of the Republic of Kazakhstan, on a special order of the Republic of Kazakhstan, other government bodies, legal entities and citizens may act on its behalf.

3. Civil disputes involving the Republic of Kazakhstan are resolved by the courts.

Footnote. Article 111 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 112. Participation of an administrative-territorial unit in civil legal relations

1. An administrative-territorial unit acts in relations regulated by civil legislation on an equal basis with other participants in these relations.

RCPI note! This version of the first part of paragraph 2 is valid from 01/01/2018 for cities of regional significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 07/11/2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

2. On behalf of an administrative-territorial unit, by their actions, local representative and executive bodies, as well as the offices of akims of cities of regional significance, villages, towns, rural districts can acquire and exercise property and personal non-property rights and obligations, act in court, within the framework of their competence established by the laws of the Republic of Kazakhstan, regulations or other acts defining the status of these bodies.

In cases and in the manner provided for by law, local government bodies, legal entities and citizens may act on behalf of an administrative-territorial unit on special instructions.

3. In cases determined by law, an administrative-territorial unit may act in civil legal relations on behalf of the state.

4. The administrative-territorial unit and its bodies are subject to the provisions of this Code on the participation, respectively, of the state and its bodies in relations regulated by civil legislation, unless otherwise follows from the legislation.

5. Civil disputes involving an administrative-territorial unit are resolved by the courts.

Footnote. Article 112 as amended by the Law of the Republic of Kazakhstan dated July 11, 2017 No. 90-VI (for the order of enforcement, see clause 1) clause 1, article 2).

Article 113. Foreclosure of obligations of the Republic of Kazakhstan and the administrative-territorial unit

1. The Republic of Kazakhstan is liable for its obligations with the property of the state treasury, and the administrative-territorial unit is liable for its obligations with the property of the local treasury.

2. The Republic of Kazakhstan and the administrative-territorial unit are not liable for the obligations of each other, as well as for the obligations of citizens and legal entities, and citizens and legal entities are not liable for the obligations of the Republic of Kazakhstan and the administrative-territorial unit, except for the cases provided for by this Code and legislative acts.

Article 114. Application of norms on legal entities to the state and administrative-territorial unit

The rules governing the participation of legal entities in relations regulated by civil law are applied to the state and administrative-territorial units, unless otherwise follows from legislative acts.

Chapter 3. Objects of civil rights

Paragraph 1. General provisions

Article 115. Types of objects of civil rights

1. The objects of civil rights can be property and personal non-property benefits and rights.

2. Property benefits and rights (property) include: things, money, including foreign currency, financial instruments, works, services, objectified results of creative intellectual activity, brand names, trademarks and other means of individualizing products, property rights, digital assets and other property.

2-1. The legal regime of things or property rights (claims) is applied to money and rights (claims) under a monetary obligation (rights of claim for payment of money), respectively, unless otherwise provided by this Code, other legislative acts of the Republic of Kazakhstan or does not follow from the essence of the obligation.

3. Personal non-property benefits and rights include: life, health, personal dignity, honor, good name, business reputation, privacy, personal and family secrets, the right to a name, the right to authorship, the right to the integrity of a work and other intangible benefits and rights.

Footnote. Article 115 as amended by the laws of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); dated 12/10/2008 N 101-IV (effective from 01/01/2009); dated 06/25/2020 No. 347-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 116. Transferability of objects of civil rights

1. Objects of civil rights may be freely alienated or transferred from one person to another in the order of universal succession (inheritance, reorganization of a legal entity) or in another way, unless they are withdrawn from circulation or limited in circulation.

2. Types of property the alienation of which is not allowed (withdrawn from circulation) must be directly indicated in the laws.

3. Types of property that can belong only to certain participants in the turnover or the acquisition or alienation of which is permitted with a special permit (limitedly negotiable) are determined by law.

3-1. The concept and types of digital assets, as well as the features of the turnover of digital assets are determined by the legislation of the Republic of Kazakhstan and the acts of the Astana International Financial Center.

4. Personal non-property benefits and rights are inalienable and non-transferable in any other way, except for cases established by legislative acts.

Footnote. Article 116 as amended by the laws of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication); dated June 25, 2020 No. 347-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication).

Article 117. Immovable and movable property

1. Real estate (immovable things, real estate) includes: land plots, buildings, structures, perennial plantings and other property firmly connected to the land, that is, objects whose movement without disproportionate damage to their purpose is impossible.

Apartments and other residential premises, as well as non-residential premises located as part of a condominium property, are recognized as independent objects (types) of real estate if they are individually (separately) owned.

2. Aircraft and sea vessels, inland water vessels, river-sea vessels, space objects, and the linear part of main pipelines subject to state registration are also considered immovable things. Legislative acts may also classify other property as immovable property.

The norms of this Code and other legislative acts regulating relations related to immovable things apply to the things specified in this paragraph in the case expressly provided for by the legislative acts of the Republic of Kazakhstan.

3. Property not related to real estate, including money and securities, is recognized as movable property. Registration of rights to movable things is not required, except in cases specified in legislative acts.

Footnote. Article 117 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be enforced after ten calendar days after its first official publication); as amended by the Law of the Republic of Kazakhstan dated June 22, 2012 No. 21-V (shall be brought into force ten calendar days after its first official publication).

Article 118. State registration of rights to real estate

1. The emergence, change and termination of rights (encumbrances of rights) to real estate are subject to state registration in cases provided for by this Code and the Law of the Republic of Kazakhstan “On state registration of rights to real estate”.

Other objects of state registration related to real estate are determined by the Law of the Republic of Kazakhstan “On State Registration of Rights to Real Estate”.

2. Rights (encumbrances of rights) to real estate arise, change and terminate from the moment of state registration, unless otherwise established by this Code and the Law of the Republic of Kazakhstan “On State Registration of Rights to Real Estate”. If registration is not refused, the moment of state registration is the moment of filing the application, and in case of electronic registration - the moment of confirmation of the emergence, change or termination of rights (encumbrances of rights) by the registering authority by sending a notification of the registration.

3. The body carrying out state registration of rights to real estate is obliged, at the request of the right holder, to certify the registration performed by making an inscription on the title document submitted for registration. In cases provided for by the Law of the Republic of Kazakhstan “On state registration of rights to real estate”, the body carrying out registration issues a certificate of ownership (other property right) to real estate.

4. State registration of rights to real estate is public. The body carrying out registration is obliged to provide information about registered rights to real estate to any person, taking into account the restrictions established by the Law of the Republic of Kazakhstan “On State Registration of Rights to Real Estate”.

5. Refusal of state registration of rights to real estate or unjustified evasion of registration may be appealed in the manner established by the laws of the Republic of Kazakhstan.

6. The procedure for state registration is established in accordance with this Code and the Law of the Republic of Kazakhstan “On State Registration of Rights to Real Estate”.

7. The procedure for state registration of civil aircraft, sea vessels, inland water navigation vessels, river-sea navigation vessels, space objects, as objects equated to real estate, is regulated by the laws of the Republic of Kazakhstan in the field of use of airspace and aviation activities, merchant shipping, inland water transport, and space activities.

Footnote. Article 118 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); as amended by the laws of the Republic of Kazakhstan dated 01/06/2012 No. 529-IV (comes into force after 21 calendar days after its first official publication); dated 12/29/2014 № 269-V (effective from 01/01/2015); dated 06/29/2020 No. 351-VI (takes effect from 07/01/2021).

Article 119. Enterprise

1. An enterprise, as an object of rights, is recognized as a property complex used to carry out business activities.

2. The composition of an enterprise as a property complex includes all types of property intended for its activities, including buildings, structures, equipment, inventory, raw materials, products, rights to a land plot, rights of claim, debts, as well as rights to designations that individualize its activities (company name, trademarks), and other exclusive rights, unless otherwise provided by the contract.

3. The enterprise as a whole or part of it may be the object of purchase and sale, pledge, lease and other transactions related to the establishment, change and termination of property rights.

3-1. Features of the state registration of rights to real estate that is part of an enterprise as a property complex are established by the Law of the Republic of Kazakhstan “On state registration of rights to real estate.”

4. When transferring debts as part of an enterprise as a property complex, the rights of creditors are guaranteed in the manner prescribed by Article 48 of this Code.

Footnote. Article 119 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated March 25, 2011 No. 421-IV (shall be enforced ten calendar days after its first official publication).

Article 120. Divisible and indivisible property

1. Property can be divisible and indivisible.

Divisible property is property, parts of which do not lose their purpose (functions) as a result of division.

Indivisible property is property that cannot be divided without changing its economic purpose (functions) or is not subject to division by virtue of a legislative act.

2. The features of indivisible things as objects of law are determined by law.

Article 121. Complex things

1. If heterogeneous things form a single whole, allowing it to be used for a purpose determined by the essence of the connection, they are considered as one thing (complex thing).

2. The validity of a transaction concluded regarding a complex thing extends to all its components, unless otherwise provided by the contract.

Article 122. Main thing and accessory

An accessory, that is, a thing intended to serve the main thing and connected with it by a general economic purpose, follows the fate of the main thing, unless otherwise established by law or contract.

Article 123. Fruits, products and income

Receipts received as a result of the use of property (fruits, products, income) belong to the person using this property legally, unless otherwise provided by law or an agreement on the use of this property.

Article 124. Animals

The general rules about things apply to animals, unless otherwise provided by law.

Article 125. Intellectual property

1. In cases and in the manner established by this Code and other legislative acts, the exclusive right of a citizen or legal entity to the results of intellectual creative activity and equivalent means of individualization of a legal entity, products of an individual or legal entity, work or services performed by them (company name, trademark, service mark, etc.) is recognized.

2. The use of the results of intellectual creative activity and means of individualization, which may be the object of exclusive rights (intellectual property), can be carried out by third parties only with the consent of the copyright holder, except for cases provided for by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 125 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 04/07/2015 No. 300-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 126. Official and commercial secrets

1. Civil legislation protects information constituting an official or commercial secret in the case where the information has actual or potential commercial value due to its unknown to third parties, there is no free access to it on a legal basis and the owner of the information takes measures to protect its confidentiality.

2. Persons who obtained such information through illegal methods, as well as employees contrary to an employment contract or counterparties contrary to a civil contract who disclosed official or commercial secrets, are obliged to compensate for the damage caused.

Article 127. Money (currency)

1. The monetary unit in the Republic of Kazakhstan is the tenge.

2. Tenge is a legal means of payment, obligatory for acceptance at face value throughout the territory of the Republic of Kazakhstan.

3. Payments on the territory of the Republic of Kazakhstan are made in the form of cash and non-cash payments.

4. Cases, procedure and conditions for settlements in foreign currency on the territory of the Republic of Kazakhstan are determined by the legislation of the Republic of Kazakhstan.

Article 128. Currency values

1. The types of property recognized as currency values ​​and the procedure for transactions with them are determined by legislative acts.

2. The right of ownership of currency values ​​is protected in the Republic of Kazakhstan on a general basis.

Paragraph 1-1. Financial instruments

Footnote. Section 3 is supplemented by paragraph 1-1 in accordance with the Law of the Republic of Kazakhstan dated 12/10/2008 N 101-IV (enters into force from 01/01/2009).

Article 128-1. Financial instruments

1. Financial instrument – ​​money, securities, including derivative securities, derivative financial instruments, digital financial assets and other financial instruments, as a result of transactions with which a financial asset simultaneously arises for one person and a financial liability or equity instrument for another.

A financial instrument may be issued in electronic digital form in accordance with the provisions of the Law of the Republic of Kazakhstan “On Digital Assets in the Republic of Kazakhstan”.

2. Financial asset - any asset that represents money, an equity instrument of another person, a contractual right to receive money or another financial asset from another person or to exchange financial assets or financial liabilities with another person on terms potentially favorable to itself, or such a contract that will or may be settled in the person's own equity instruments and which is such a derivative instrument for which the person has or may become obligated to receive a variable number of its own equity instruments, or such a derivative instrument that will be settled or may be effected by any means other than by exchanging a fixed amount of money or other financial asset for a fixed number of the person's own equity instruments.

3. Financial liability - any obligation that represents a contractual obligation to deliver money or another financial asset to another person or to exchange financial assets or financial liabilities with another person on potentially unfavorable terms, or such a contract that will or may be settled in the person's own equity instruments and which is a non-derivative instrument for which the person has or may become obligated to deliver a variable number of its own equity instruments, or such a derivative instrument that will or may be settled in any manner other than by exchanging a fixed amount of money or other financial asset for a fixed number of a person's own equity instruments.

4. Equity instrument - any agreement confirming the right to a residual share in the assets of an organization remaining after deducting all its liabilities.

Footnote. Article 128-1 as amended by the laws of the Republic of Kazakhstan dated 07/02/2018 No. 166-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 16.01.2026 No. 259-VIII (takes effect from 01.05.2026).

Article 128-2. Derivatives

1. A derivative financial instrument is a contract, the value of which depends on the value (including fluctuations in the value) of the underlying asset of the contract, providing for settlement under this contract in the future.

2. Derivative financial instruments include options, futures, forwards, swaps and other derivative financial instruments that meet these criteria, including those that are a combination of the above derivative financial instruments.

3. The underlying assets of derivative financial instruments are commodities, standardized consignments of goods, securities, currencies, indices, interest rates and other assets that have a market value, a future event or circumstance, and derivative financial instruments.

Article 128-3. Option

1. An option is a derivative financial instrument, according to which one party (the seller of the option) sells to the other party (the buyer of the option) the right to buy or sell the underlying asset at an agreed price on agreed terms in the future. The seller of the option assumes the obligation, and the buyer acquires the right.

2. The seller of the option sells the option to the buyer of the option for a consideration called a premium. The agreed terms of an option mean the agreement on the following mandatory conditions: the type of underlying asset, the total value of the underlying asset (the amount for which the option is concluded), the price of the underlying asset (strike - the exercise price of the option), the option premium, the option period (the period of validity of the option), the type of option.

3. An option is considered exercised if the buyer of the option exercises the right he has acquired.

Article 128-4. Swap

A swap is a derivative financial instrument under which the parties agree to exchange payments on underlying assets or underlying assets in the future on agreed terms.

Article 128-5. Forward

1. Forward is a derivative financial instrument, the buyer (or seller) of which undertakes, after a certain period, to buy (or sell) the underlying asset on agreed terms in the future.

2. The forward is concluded on an unorganized market.

Article 128-6. Futures

A futures is a derivative financial instrument traded only on an organized market, the buyer (or seller) of which undertakes to, after a certain period, buy (or sell) the underlying asset in accordance with standard conditions established on the organized market.

Paragraph 2. Securities

Article 129. Securities

1. Security - a set of certain records and other designations certifying property rights.

1-1. Securities can be debt or equity.

Debt securities are securities that certify the obligation of the issuer (debtor) to pay the principal amount of the debt under the terms of the issue of these securities.

An equity security is a security certifying the right of its owner to a certain share in property in cases provided for by the legislation of the Republic of Kazakhstan.

2. Securities include shares, bonds and other types of securities determined in accordance with this Code and other legislative acts of the Republic of Kazakhstan.

3. Securities according to the form of issue are divided into:

1. documentary and non-documentary;

2. emission and non-emission;

3. registered and order.

Documentary securities are securities issued in documentary form (on paper or other tangible media with the ability to directly read the contents of the security without the use of special technical means).

Book-entry securities are securities issued in book-entry form (in the form of a set of electronic records), including in electronic digital form.

Issue-grade securities are securities that have homogeneous characteristics and details within one issue, placed and circulated on the basis of conditions uniform for a given issue.

Non-issue securities are securities that do not meet the characteristics specified in part four of this paragraph.

A registered security is a security that confirms the ownership of the rights certified by it to the person named in it.

An order security is a security that confirms the ownership of the rights certified by it to the person named in it, and in the event of transfer of these rights by him in the manner provided for in paragraph 3 of Article 132 of this Code, to another person.

4. This Code and other legislative acts of the Republic of Kazakhstan may exclude the possibility of issuing a certain type of securities in one form or another.

Footnote. Article 129 as amended by the Law of the Republic of Kazakhstan dated May 16, 2003 N 416; as amended by the Law of the Republic of Kazakhstan dated December 10, 2008 N 101-IV (to come into effect from January 1, 2009); as amended by the laws of the Republic of Kazakhstan dated September 19, 2025 No. 219-VIII (shall be brought into force sixty calendar days after the day of its first official publication); dated 01/16/2026 No. 259-VIII (takes effect from 05/01/2026).

Article 130. Confirmation of rights to a security

1. Confirmation of the right to a documentary security is the security itself. In the case of transfer of a certified security for storage to a professional participant in the securities market, authorized for such storage in accordance with the license issued to him or in accordance with the legislative acts of the Republic of Kazakhstan, confirmation of the right to this security is an extract from the account opened by this professional participant for the purpose of its accounting. If there is a discrepancy between the certificated security and the statement from the specified account, the statement has priority.

2. Confirmation of the right to an uncertificated security is an extract from an account opened for the purpose of its accounting with a professional participant in the securities market who is authorized to register transactions with securities in accordance with the license issued to him or in accordance with the legislative acts of the Republic of Kazakhstan.

3. The procedure for opening and maintaining accounts intended for recording securities by professional participants in the securities market, as well as the requirements for the content and execution of statements from such accounts are determined by the legislation of the Republic of Kazakhstan.

Footnote. Article 130 as amended by the Law of the Republic of Kazakhstan dated May 16, 2003 N 416; as amended by the Law of the Republic of Kazakhstan dated December 28, 2011 No. 524-IV (shall be brought into force ten calendar days after its first official publication).

Article 131. Requirements for a security

1. The types of rights that are certified by securities, the mandatory details of securities, requirements for the form of a security and other necessary requirements are determined by legislative acts or in the manner established by them.

2. The absence of mandatory details of a security or non-compliance of the security with the form established for it entails its invalidity.

Article 132. Transfer of rights under a security

1. Excluded by the Law of the Republic of Kazakhstan dated September 19, 2025 No. 219-VIII (shall be brought into force sixty calendar days after the day of its first official publication).

2. Rights certified by a registered security issued in documentary form are transferred in the manner established for the assignment of a claim (assignment). In accordance with Article 347 of this Code, the person transferring the right under a security is liable for the invalidity of the corresponding requirement, but not for its execution.

2-1. Features of the transfer of rights to issue-grade securities and confirmation of rights to them are determined by the legislative acts of the Republic of Kazakhstan.

3. Rights under an order security are transferred by making an endorsement on this paper - an endorsement. The person transferring the rights under an order security (endorser) is responsible not only for the existence of the right, but also for its implementation, with the exception of cases established by the legislative act of the Republic of Kazakhstan on the mortgage of real estate.

An endorsement made on a security transfers all the rights certified by the security to the person to whom or to whose order the rights under the security are transferred - (the endorser). The endorsement may be in blank (without indicating the person to whom the execution should be made).

An endorsement may be limited only to an instruction to exercise the rights certified by a security, without transferring these rights to the endorsee (authentic endorsement). In this case, the endorsee acts as a representative.

Footnote. Article 132 as amended by Laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 05/16/2003 N 416; dated 06/03/2003 N 426; dated 06/21/2013 № 106-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated November 24, 2015 No. 422-V (entered into effect from 01/01/2016); dated 19.09.2025 No. 219-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 133. Execution on a security

1. The person who issued the security and all persons who endorsed it are jointly and severally liable to its legal owner, with the exception of cases established by the legislative act of the Republic of Kazakhstan on the mortgage of real estate. If the request of the legal owner of a security for the fulfillment of the obligation certified by it is satisfied by one or more persons from among those obligated under the security, they acquire the right of recourse (recourse) to the remaining persons who previously obligated them under the security.

2. Refusal to fulfill an obligation certified by a security with reference to the absence of a basis for the obligation or its invalidity is not allowed.

3. The owner of a security who has discovered a forgery or falsification of a security has the right to present to the person who transferred the security a demand for proper fulfillment of the obligation certified by the security and for compensation for losses.

4. Rights under a security held by an illegal owner cannot be exercised.

Footnote. Article 133 was amended by the Law of the Republic of Kazakhstan dated June 3, 2003 N 426

Article 134. Restoration of a security

Restoration of rights to lost order securities is carried out by the court in the manner prescribed by procedural legislation.

Footnote. Article 134 as amended by the Law of the Republic of Kazakhstan dated September 19, 2025 No. 219-VIII (shall be brought into force sixty calendar days after the day of its first official publication).

Article 135. Uncertificated securities

(Article 135 is excluded by the Law of the Republic of Kazakhstan dated May 16, 2003 N 416)

Article 136. Bond

1. Bond is a security that, in accordance with the terms of the issue, certifies the right to receive from the person who issued the bond the remuneration on it and the nominal value of the bond in money or other property equivalent.

2. Bonds are issued only as registered issue-grade securities.

3. The Government of the Republic of Kazakhstan, the National Bank of the Republic of Kazakhstan, commercial organizations have the right to issue bonds.

4. Types of bonds and the procedure for their issue are established by the legislation of the Republic of Kazakhstan.

Footnote. Article 136 as amended by the Law of the Republic of Kazakhstan dated May 16, 2003 N 416; as amended by the laws of the Republic of Kazakhstan dated December 20, 2004 N 13 (takes effect from January 1, 2005); dated July 12, 2022 No. 138-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 137. Check

Footnote. Article 137 was excluded by the Law of the Republic of Kazakhstan dated July 11, 1997 N 154.

Article 138. Bill of exchange

Footnote. Article 138 was excluded by the Law of the Republic of Kazakhstan dated July 11, 1997 N 154.

Article 139. Share

1. A share is a security issued by a joint-stock company and certifying the rights to participate in the management of the joint-stock company, receive a dividend on it and part of the property of the joint-stock company upon its liquidation, as well as other rights provided for by the legislative acts of the Republic of Kazakhstan.

2. Shares are issued only as registered issue-grade securities.

3. Types of shares are established by legislative acts of the Republic of Kazakhstan.

The procedure for issuing shares is established by the legislation of the Republic of Kazakhstan on the securities market.

4. Non-profit organizations created in the legal form of a joint stock company do not pay dividends on their shares.

5. Legislative acts of the Republic of Kazakhstan may provide for the possibility of repurchasing shares by court decision from a shareholder who, by his actions or inaction, violates the interests of the joint-stock company.

Legislative acts of the Republic of Kazakhstan may provide for the possibility and grounds for the forced repurchase of shares of banks and organizations carrying out certain types of banking operations, as well as insurance (reinsurance) organizations if they have a negative amount of equity capital, calculated in the manner established by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 139 as amended by the Law of the Republic of Kazakhstan dated May 16, 2003 N 416; as amended by the Law of the Republic of Kazakhstan dated July 8, 2005 N 72 (the order of enforcement see Article 2).

Article 139-1. Bank certificate of deposit

A bank certificate of deposit is a registered non-issue security certifying the rights of its holder to receive, after the expiration of the circulation period established for it by the terms of issue or before its expiration, its nominal value, as well as remuneration in the amount established by the terms of issue.

Footnote. The Code is supplemented by Article 139-1 in accordance with the Law of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication).

Article 140. Bank certificate

Footnote. Article 140 was excluded by the Law of the Republic of Kazakhstan dated July 11, 1997 N 154.

Paragraph 3. Personal non-property rights

Article 141. Protection of personal non-property rights

1. An individual whose personal non-property rights have been violated, in addition to the measures provided for in Article 9 of this Code, has the right to compensation for moral damage according to the rules of this Code.

2. Protection of personal non-property rights is carried out by the court in the manner prescribed by civil procedural legislation.

3. Personal non-property rights are subject to protection regardless of the guilt of the person who violated the right, unless otherwise provided by this Code. The person making a claim for protection must prove that his personal non-property right has been violated.

4. A person whose non-property right has been violated may, at his own choice, demand elimination of the consequences of the violation from the violator or, at the violator’s expense, independently perform the necessary actions or entrust them to a third party.

Footnote. Article 141 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication).

Article 142. Personal non-property rights associated with property

In case of simultaneous violation of personal non-property and property rights, the amount of compensation for property damage increases taking into account the compensation due to the victim for the violation of personal non-property rights.

Article 143. Protection of honor, dignity and business reputation

1. A citizen has the right to demand in court a refutation of information discrediting his honor, dignity or business reputation.

2. If information discrediting the honor, dignity or business reputation of a citizen or legal entity is disseminated in the media, it must be refuted free of charge in the same media.

If the specified information is contained in a document emanating from the organization, such a document is subject to replacement or withdrawal with the obligatory notification to the addressees about the inconsistency of the information contained in this document.

The procedure for refutation in other cases is established by the court.

3. A citizen or legal entity in respect of whom the media has published information that infringes on his rights or legitimate interests has the right to free publication of his response in the same media.

4. The request of a citizen or legal entity to publish a refutation or answer in the mass media is considered by the court if the mass media body refuses such publication or fails to publish it within a month, as well as in the event of its liquidation.

5. If the court decision is not implemented, the court has the right to impose a fine on the violator, collected as budget revenue. The fine is imposed in the manner and amount established by civil procedural legislation. Payment of a fine does not relieve the offender from the obligation to perform the action prescribed by the court decision.

6. A citizen in respect of whom information discrediting his honor, dignity or business reputation has been disseminated, has the right, along with a refutation of such information, to demand compensation for losses and moral damage caused by its dissemination.

The rules of this article on the protection of a citizen’s business reputation are correspondingly applied to the protection of the business reputation of a legal entity, with the exception of claims for compensation for moral damage. The rules on compensation for losses in the manner prescribed by this Code apply to the protection of the business reputation of a legal entity.

7. If it is impossible to identify the person who disseminated information discrediting the honor, dignity or business reputation of a citizen or legal entity, the person in respect of whom such information was disseminated has the right to apply to the court to declare the disseminated information untrue.

Footnote. Article 143 as amended by the laws of the Republic of Kazakhstan dated 02/06/2009 N 123-IV (for the order of enforcement, see st.2); dated March 25, 2011 No. 421-IV (shall be enforced ten calendar days after its first official publication).

Article 144. Right to protect privacy of personal life

1. A citizen has the right to protect the secrets of his personal life, including the secrets of correspondence, telephone conversations, diaries, notes, notes, intimate life, adoption, birth, attorney-client secrets, secrets of a medical worker, bank deposits and other secrets protected by the laws of the Republic of Kazakhstan.

Disclosure of the secrets of personal life is possible only in cases directly established by the laws of the Republic of Kazakhstan.

2. Publication of diaries, notes, notes and other documents is permitted only with the consent of their author, and letters - with the consent of their author and addressee. In the event of the death of one of them, these documents may be published with the consent of the surviving spouse and children of the deceased.

Footnote. Article 144 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 07/14/2022 No. 141-VII (shall be enforced ten calendar days after the day of its first official publication).

Article 145. Right to one’s own image

1. No one has the right to use the image of any person without his consent, and in the event of his death - without the consent of his heirs.

2. Publication, reproduction, use and distribution of a visual work (painting, photograph, film, etc.) in which another person is depicted is permitted only with the consent of the person depicted, and after his death, with the consent of his children and surviving spouse. Such consent is not required if this is established by the laws of the Republic of Kazakhstan, or the person depicted posed for a fee.

Footnote. Article 145 as amended by the Law of the Republic of Kazakhstan dated December 23, 2023 No. 51-VIII (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 146. Right to inviolability of home

A citizen has the right to the inviolability of his home, that is, the right to suppress any attempts to invade his home against his will, except in cases provided for by legislative acts.

Chapter 4. Transactions Article 147. Concept of a transaction

Transactions are recognized as actions of citizens and legal entities aimed at establishing, changing or terminating civil rights and obligations.

Article 148. Unilateral transactions and agreements

1. Transactions can be unilateral and bilateral or multilateral (agreements).

2. A transaction is considered unilateral, for the completion of which, in accordance with the law or agreement of the parties, it is necessary and sufficient to express the will of one party.

3. To complete a contract, it is necessary to express the agreed will of two parties (bilateral transaction) or three or more parties (multilateral transaction).

Article 149. Legal regulation of unilateral transactions

1. A unilateral transaction creates obligations for the person who made the transaction. It can create obligations for other persons only in cases established by legislative acts or by agreement with these persons.

2. The general provisions on obligations and contracts are respectively applied to unilateral transactions, since this does not contradict the law, the nature and essence of the transaction.

Article 150. Transactions made under conditions

1. A transaction is considered completed under a suspensive condition if the parties have made the emergence of rights and obligations dependent on a circumstance for which it is unknown whether it will occur or not.

2. A transaction is considered completed under a severable condition if the parties have made the termination of rights and obligations dependent on a circumstance regarding which it is unknown whether it will occur or not.

3. If the occurrence of a condition was prevented in bad faith by a party for whom the occurrence of the condition is unfavorable, then the condition is recognized as having occurred.

If the occurrence of a condition was facilitated in bad faith by a party to whom the occurrence of the condition is beneficial, then the condition is recognized as not having occurred.

Article 151. Form of transaction

1. Transactions are made orally or in writing (simple or notarial).

2. A transaction for which a written (simple or notarial) or other specific form is not established by law or agreement of the parties can be concluded orally, in particular - all transactions executed upon their very completion. Such a transaction is also considered completed in the case when the person’s behavior makes clear his will to complete the transaction.

3. A transaction confirmed by the issuance of a token, ticket or other usually accepted confirmation sign is recognized as concluded orally, unless otherwise provided by law.

4. Silence is recognized as an expression of the will to complete a transaction in cases provided for by law or agreement of the parties.

5. Transactions in pursuance of an agreement concluded in writing may, by agreement of the parties, be made orally, if this does not contradict the law.

Article 152. Written form of a transaction

1. Transactions must be made in writing:

1. carried out in the course of entrepreneurial activity, except for transactions executed during their very execution, unless otherwise specifically provided for by law for certain types of transactions or does not follow from business customs;

2. for an amount exceeding one hundred monthly calculation indices, with the exception of transactions executed upon their very completion;

3. in other cases provided for by law or agreement of the parties.

1-1. The written form of the transaction is made on paper or electronically.

2. A transaction made in writing must be signed by the parties or their representatives, unless otherwise follows from business customs.

When making a transaction, it is allowed to use means of facsimile copying of a signature, electronic digital signature, if this does not contradict the law or the requirement of one of the participants.

3. Bilateral transactions can be concluded through the exchange of documents, each of which is signed by the party from which it originates.

Unless otherwise established by law or by agreement of the parties, the exchange of letters, telegrams, telephone messages, teletype messages, faxes, electronic documents, electronic messages or other documents defining the subjects and the content of their will is equated to the conclusion of a transaction in writing, unless otherwise established by law or by agreement of the parties.

The laws of the Republic of Kazakhstan and (or) at the request of one of the parties may establish additional requirements that the form of the transaction must comply with, in particular, execution on a certain form, sealed by a legal entity, if this person, in accordance with the legislation of the Republic of Kazakhstan, must have a seal.

4. If a citizen, due to a physical disability, illness or illiteracy, cannot sign with his own hand, then, at his request, another citizen can sign the transaction. The signature of the latter, unless otherwise provided by law, must be certified by a notary or other official who has the right to perform such a notarial act, indicating the reasons why the person making the transaction could not sign it with his own hand.

5. The party that has executed a transaction made in writing has the right to demand from the other party a document confirming execution.

The party who has executed an oral business transaction has the same right, except for transactions executed upon their very completion.

Footnote. Article 152 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 No. 211; dated 01/07/2003 No. 372; dated 12/29/2014 № 269-V (effective from 01/01/2015); dated November 24, 2015 No. 419-V (entered into effect from 01/01/2016); dated 02.27.2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 05/24/2018 No. 156-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 153. Consequences of failure to comply with the written form of the transaction

1. Failure to comply with the simple written form of a transaction deprives the parties of the right in the event of a dispute to confirm its completion, content or execution with witness testimony. The parties, however, have the right to confirm the completion, content or execution of the transaction with written or evidence other than testimony.

2. In cases directly specified in the laws of the Republic of Kazakhstan or the agreement of the parties, if the simple written form is not observed, the transaction is considered void.

3. If a simple written form is not observed, a foreign economic transaction is considered void.

Footnote. Article 153 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 154. Notarization of a transaction

1. In cases established by the laws of the Republic of Kazakhstan or by agreement of the parties, written transactions are considered completed only after they have been notarized.

Failure to comply with the requirement for notarization entails the nullity of the transaction with the consequences provided for in paragraph 3 of Article 157-1 of this Code, except for the cases established by paragraph 2 of this article.

2. If a transaction requiring notarization is actually executed by the parties or one of the parties, its content does not contradict the law and does not violate the rights of third parties, the court, upon application of the interested party, has the right to recognize the transaction as valid. In this case, subsequent notarization of the transaction is not required.

Footnote. Article 154 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 155. Registration of transactions

1. Transactions subject to mandatory state or other registration in accordance with legislative acts are considered completed from the moment of registration, unless otherwise provided by legislative acts.

Refusal to register must be in writing and is possible only with reference to a violation of legal requirements.

2. If one of the parties evades state registration of a transaction, the court has the right, at the request of the other party, to make a decision to register the transaction. In this case, the transaction is registered in accordance with the court decision.

Footnote. Article 155 as amended by the Law of the Republic of Kazakhstan dated July 26, 2007 No. 311 (shall be enforced after 10 calendar days after official publication); as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force ten calendar days after its first official publication).

Article 156. Exchange transactions

1. Exchange transactions are transactions the subject of which is property admitted for circulation on the exchange, and which are concluded on the exchange by participants in its trading in accordance with the legislation of the Republic of Kazakhstan on the relevant exchanges (commodity, stock and others) and the rules of exchange trading.

2. Exchange transactions are formalized by documents issued by the exchange confirming the conclusion of these transactions.

3. Depending on their content, exchange transactions are subject to the rules on the relevant agreement (purchase and sale, commission and others), unless otherwise follows from the law, agreement of the parties or the essence of the transaction.

4. Legislation or rules of exchange trading may provide for the terms of exchange transactions that constitute a trade secret of the parties and are not subject to disclosure without their consent, except for information submitted to the authorized body for financial monitoring in accordance with the Law of the Republic of Kazakhstan “On combating the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction.”

5. Disputes related to the conclusion of exchange transactions are considered in arbitration at the relevant exchange, the decision of which can be overturned by the court in cases provided for by the law of the Republic of Kazakhstan.

6. (excluded). Footnote. Article 156 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated 05/16/2003 № 416; dated 08/28/2009 № 192-IV (effective from 03/08/2010); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 06/21/2012 № 19-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 06/10/2014 № 206-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 04/08/2016 No. 489-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 19.09.2025 No. 219-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 157. Voidable and void transactions

1. A transaction is invalid on the grounds established by this Code or other legislative acts, due to its recognition as such by the court (voidable transaction) or on the grounds directly provided for by legislative acts, regardless of such recognition (void transaction).

A transaction is voidable if its nullity is not provided for by legislative acts.

If a dispute arises about the nullity of a transaction, its invalidity is established by the court.

2. A transaction is declared invalid if the requirements for the form, content and participants of the transaction, as well as for their freedom of expression, are violated on the grounds established by this Code or other legislative acts.

3. A demand to recognize a transaction as invalid may be made by interested parties, an appropriate government agency or a prosecutor.

An interested party is a person whose rights and legitimate interests are violated or may be violated as a result of the said transaction.

The list of persons who have the right to demand that it be declared invalid is established by this Code and (or) other legislative acts.

Footnote. Article 157 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 157-1. General provisions on the consequences of invalidity of a transaction

1. A demand for the application of the consequences of the invalidity of a void transaction may be submitted by a party to the transaction or by persons established in clause 3 of Article 157 of this Code.

2. An invalid transaction does not entail legal consequences, except for those associated with its invalidity, and is invalid from the moment of its completion, unless otherwise provided by this Code, the legislative acts of the Republic of Kazakhstan or follows from the essence or content of the transaction.

3. If the transaction is invalid, each party is obliged to return to the other everything received under the transaction, and if it is impossible to return in kind (including when what was received is expressed in the use of property, work performed or service provided) - to reimburse the cost of the property to be returned, the cost of using the property, work performed or services provided in money, unless other consequences of the invalidity of the transaction are provided for by this Code or other legislative acts of the Republic of Kazakhstan.

4. The court may recover from the party guilty of committing actions that caused the invalidity of the transaction, in favor of the other party, the losses incurred by the latter in connection with the recognition of the transaction as invalid.

5. If a transaction is aimed at achieving a criminal goal, the illegality of which is established by a court verdict (decision), then, if there is intent on the part of both parties, everything received by them under the transaction or intended to be received is subject to confiscation by a court decision or sentence. If such a transaction is executed by one party, everything received by it and everything due from it under the transaction to the first party is subject to confiscation from the other party. If neither party has begun execution, everything provided for execution by the transaction is subject to confiscation.

6. If there is intent to achieve a criminal goal, the illegality of which is established by a court verdict (decision), only one of the parties has everything received by it under the transaction, subject to return to the other party, and what the latter received or what was due to it under the transaction is subject to confiscation.

7. Taking into account specific circumstances, the court has the right not to apply partially or fully the consequences provided for in paragraphs 5 and 6 of this article in terms of confiscation of property received or to be received under an invalid transaction. In this part, the consequences provided for in paragraph 3 of this article occur.

8. When declaring a transaction invalid, the court has the right, taking into account specific circumstances, to limit itself to prohibiting its further execution.

Footnote. Chapter 4 is supplemented by Article 157-1 in accordance with the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 158. Invalidity of a transaction, the content of which does not comply with the requirements of the legislation of the Republic of Kazakhstan

1. A transaction, the content of which does not comply with the requirements of the law, as well as a transaction made for a purpose that is obviously contrary to the fundamentals of the rule of law, is voidable and may be declared invalid by the court, unless otherwise established by this Code and other legislative acts of the Republic of Kazakhstan.

2. A transaction aimed at achieving a criminal goal, the illegality of which is established by a court verdict (decision), is void.

3. A person who deliberately entered into a transaction that violates the requirements of the legislation of the Republic of Kazakhstan, the charter of a legal entity or the competence of its bodies does not have the right to demand recognition of the transaction as invalid if such a demand is caused by selfish motives or the intention to evade responsibility.

4. If one of the parties to the transaction committed it with the intention of evading fulfillment of an obligation or liability to a third party or the state, and the other party to the transaction knew or should have known about this intention, the interested person (state) has the right to demand that the transaction be declared invalid.

Footnote. Article 158 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI ​​(shall be brought into force ten calendar days after the day of its first official publication).

Article 159. Grounds for invalidity of transactions

1. A transaction made without obtaining the necessary permission or after the expiration of the permit is void.

2. A transaction pursuing the goals of unfair competition or violating the requirements of business ethics may be declared invalid by the court.

3. A transaction made by a person under fourteen years of age (minor) is void, except for transactions provided for in Article 23 of this Code.

4. A transaction made by a minor who has reached fourteen years of age, without the consent of his legal representatives, except for transactions that he by law has the right to make independently, may be declared invalid by the court at the claim of the legal representatives. The rules of this article do not apply to transactions of minors who are recognized as fully capable in accordance with this Code (clause 2 of Article 17, Article 22-1 of this Code).

5. A transaction made by a person declared incompetent due to mental illness or dementia is void. A transaction made by a citizen who was subsequently declared incompetent (Article 26 of this Code) is contestable and can be declared invalid by the court at the request of his guardian, if it is proven that at the time of the transaction this citizen was in a state of mental disorder.

6. At the request of the trustee, the court may invalidate a transaction made by a person whose legal capacity has been limited by the court.

7. A transaction made by a citizen, although legally capable, was in a state at the time of its completion in which he could not understand the meaning of his actions or direct them, may be declared invalid by the court at the claim of this citizen, but if during his lifetime the citizen did not have the opportunity to bring a claim, after the death of the citizen - at the claim of other interested parties.

8. A transaction made as a result of a misconception of significant significance may be declared invalid by the court at the request of the party acting under the influence of the misconception. Of significant importance is the misconception regarding the nature of the transaction, identity or such qualities of its subject matter that significantly reduce the possibility of its use for its intended purpose. Misconception in motives can serve as a basis for the invalidity of a transaction only if such a motive is included in its content as a suspensive or disqualifying condition (Article 150 of this Code).

If the mistake was the result of gross negligence of a participant in the transaction or is covered by his entrepreneurial risk, the court, taking into account the specific circumstances and interests of the other participant in the transaction, has the right to refuse the claim to invalidate the transaction.

9. A transaction made under the influence of deception, violence, threat, as well as a transaction that a person was forced to make as a result of a combination of difficult circumstances on extremely unfavorable conditions for himself, which the other party took advantage of (a enslaving transaction), may be declared invalid by the court at the request of the victim.

10. A transaction made as a result of a malicious agreement between a representative of one party and the other party may be declared invalid by the court at the request of the injured party. Compensation for losses incurred by the injured party (clause 4, Article 9 of this Code) may be assigned in a subsidiary manner to the dishonest representative.

11. A transaction made by a legal entity in conflict with the goals of its activities, specifically limited by this Code, other legislative acts of the Republic of Kazakhstan or constituent documents, or in violation of the statutory competence of its body, may be declared invalid at the suit of the owner of the property of the legal entity or its founder (participant), if it is proven that the other party to the transaction knew or should have known about such violations.

12. Transactions provided for in paragraphs 3 and 5 of this article, at the request of the legal representatives of minors or incapacitated persons, may be recognized by a court decision as valid if they were made for the benefit of these persons.

Footnote. Article 159 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated 12.01.2007 N 225 (shall be enforced from the date of its official publication); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 05.16.2014 № 203-V (shall be enforced six months after the date of its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 160. Imaginary or feigned transactions

1. A transaction made only for show, without the intention of creating legal consequences corresponding to it (an imaginary transaction), is declared invalid by the court at the request of an interested person, an appropriate government body or a prosecutor.

2. If a transaction is made to cover up another transaction (a sham), then the rules apply that apply to the transaction that the parties really had in mind.

Footnote. Article 160 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 161. Consequences of invalidity of part of the transaction

The invalidity of a part of a transaction does not entail the invalidity of its other parts, if it can be assumed that the transaction would have been completed without the inclusion of its invalid part.

Article 162. Limitation periods for invalid transactions

1. (excluded)

2. The limitation period for disputes related to the invalidity of a transaction on the grounds provided for in paragraphs 9 and 10 of Article 159 of this Code is one year from the date of cessation of the violence or threat under the influence of which the transaction was made, or from the day when the plaintiff learned or should have learned about other circumstances that are the basis for declaring the transaction invalid.

Footnote. Paragraph 1 of Article 162 is excluded by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Chapter 5. Representation and power of attorney

Article 163. Representation

1. A transaction made by one person (representative) on behalf of another person (represented) by virtue of authority based on a power of attorney, legislation, court decision or administrative act directly creates, changes and terminates the civil rights and obligations of the represented.

Authority may also be evident from the environment in which the representative operates (retail salesperson, cashier, etc.).

2. In a transaction concluded by a representative, the rights and obligations arise directly from the represented person.

3. A representative cannot make transactions on behalf of the represented one, either in relation to himself or in relation to another person whose representative he is at the same time.

This rule does not apply to commercial representation.

4. Persons who act, although in the interests of others, but on their own behalf (commercial intermediaries, executors of inheritance, etc.), as well as persons authorized to enter into negotiations regarding possible future transactions, are not representatives.

5. It is not allowed to carry out a transaction through a representative, which by its nature can only be completed in person, as well as other transactions in cases provided for by legislative acts.

Footnote. Article 163 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

Article 164. Representation for incapacitated persons

On behalf of incapacitated citizens, transactions are carried out by their legal representatives.

Footnote. Article 164 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

Article 165. Representation without authority

A transaction made on behalf of another person by a person not authorized to carry out the transaction, or in excess of authority, creates, changes and terminates civil rights and obligations for the represented person only if he subsequently approves this transaction.

Subsequent approval by the represented makes the transaction valid from the moment it is completed.

Article 166. Commercial representation

1. A person who constantly and independently represents entrepreneurs when they enter into contracts (commercial representative) acts on the basis of a written agreement containing instructions on the powers of the representative, and in the absence of such instructions - also a power of attorney.

2. A commercial representative can simultaneously represent the interests of different parties to an agreement concluded with his participation. At the same time, he is obliged to carry out the instructions given to him with the diligence of an ordinary entrepreneur.

3. A commercial representative has the right to demand payment of the stipulated remuneration and costs incurred during the execution of the order from the parties to the agreement in equal shares, unless otherwise provided by the agreement between them.

4. A commercial representative is obliged to keep confidential information about trade transactions that has become known to him even after the execution of the instructions given to him.

5. Features of commercial representation in certain areas of business activity are established by law.

Article 167. Power of attorney

1. A power of attorney is recognized as the written authority of one person (the principal) to represent on his behalf, issued by him to another person (the attorney).

2. A power of attorney for property management and for transactions requiring notarization must be notarized, unless otherwise provided by legislative acts.

3. The following are equivalent to notarized powers of attorney:

1. powers of attorney of military personnel and other persons undergoing treatment in hospitals, sanatoriums and other military medical institutions, certified by the heads, deputies for medical units, senior and duty doctors of these hospitals, sanatoriums and other military medical institutions;

2. powers of attorney of military personnel, and at points of deployment of military units, formations, institutions and military educational institutions, where there are no state notary offices and other bodies performing notarial acts, also powers of attorney of workers and employees, members of their families and family members of military personnel, certified by the commanders (chiefs) of these units, formations, institutions, institutions;

3. powers of attorney of persons in places of deprivation of liberty, certified by the heads of places of deprivation of liberty;

4. powers of attorney of adult capable citizens located in institutions for social protection of the population, certified by the head of this institution or the corresponding body for social protection of the population;

5. powers of attorney of persons in pre-trial detention centers, certified by the heads of pre-trial detention centers.

4. A power of attorney to receive correspondence, including cash and parcels, to receive wages and other payments from citizens and legal entities can be certified by local executive bodies of cities of republican significance, the capital, districts, cities of regional significance, akims of the city of regional significance, town, village where the principal lives, the organization in which he works or studies, the housing maintenance organization at the place of residence, the administration of the inpatient medical institution in which he is located during treatment, as well as by the command of the relevant military units, when a power of attorney is issued to military personnel. A power of attorney sent by telegraph, as well as by other types of communications, when the document is sent by a communications worker, is certified by communications authorities.

5. Third parties have the right to consider as genuine a power of attorney issued to carry out actions in their regard, sent by the principal to the attorney by fax or other communication, without the mediation of official communication bodies.

6. A power of attorney on behalf of a legal entity is issued signed by its head or another person authorized to do so by its constituent documents, and is sealed by the seal of this organization, if this person, in accordance with the legislation of the Republic of Kazakhstan, must have a seal.

7. A power of attorney on behalf of a government body, commercial and non-profit organization to receive or issue money and other property assets must also be signed by the chief (senior) accountant of this organization.

8. The procedure for issuing and the form of powers of attorney to carry out transactions in a bank and powers of attorney to carry out transactions in the field of trade may be determined by special rules.

Footnote. Article 167 as amended by the laws of the Republic of Kazakhstan dated December 20, 2004 N 13 (enters into force from January 1, 2005); dated 01.03.2011 № 414-IV (shall be enforced from the date of its first official publication); Constitutional Law of the Republic of Kazakhstan dated 07/03/2013 No. 121-V (shall be enforced after ten calendar days after its first official publication); dated 12/29/2014 № 269-V (effective from 01/01/2015); dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 168. Duration of power of attorney

1. A power of attorney may be issued for a period of no more than three years. If the power of attorney specifies a longer period, it is valid for three years, and if it does not specify a validity period, it is valid for one year from the date of issue.

2. A power of attorney that does not indicate the date of its issue is void.

Footnote. Article 168 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 169. Subassignment

1. The attorney must personally perform the actions for which he is authorized. He can entrust their execution to another person only if he is authorized to do so by the received power of attorney or is forced to do so by force of circumstances to protect the interests of the principal.

2. A power of attorney by which the attorney transfers powers to another person must be notarized, except for the cases provided for in paragraphs 4 and 6 of the article 167 of this Code.

A power of attorney, by which the attorney delegates full powers to another person, must be accompanied by an initial power of attorney. A power of attorney, by which the attorney delegates certain powers specified in the original power of attorney, to another person or several persons, must be accompanied by a notarized copy of the original power of attorney.

3. The validity period of a power of attorney issued by delegation cannot exceed the validity period of the original power of attorney on the basis of which it was issued.

4. An attorney who has delegated powers to another person must immediately notify the principal about this and provide him with the necessary information about this person and his place of residence. Failure to fulfill this duty makes the attorney responsible for the actions of the person to whom he delegated authority as if he were his own.

Footnote. Article 169 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

Article 170. Termination of power of attorney

1. The power of attorney is terminated due to:

1. expiration of the power of attorney;

2. carrying out actions provided for by the power of attorney;

3. cancellation of the power of attorney by the person who issued it;

4. refusal of the person to whom the power of attorney was issued;

5. termination of the legal entity on whose behalf the power of attorney was issued;

6. liquidation of the legal entity in whose name the power of attorney was issued;

7. death of the person (including declaration of death) who issued the power of attorney, recognition of him as incompetent, partially capable or missing;

8. death of a citizen (including declaration of death) to whom a power of attorney was issued, recognition of him as incompetent, partially capable or missing.

2. The person who issued the power of attorney may at any time revoke the power of attorney or subassignment, and the person to whom the power of attorney was issued may refuse it. An agreement to waive this right is void.

Footnote. Article 170 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 171. Consequences of termination of a power of attorney

1. The principal is obliged to notify the person to whom the power of attorney was issued, as well as third parties known to him, for whose representation the power of attorney was issued, about the cancellation of the power of attorney (Article 170 of this Code). The same obligation is assigned to the legal successors of the person who issued the power of attorney in cases of its termination on the grounds specified in paragraphs 5 and 7 of Article 170 of this Code.

2. The rights and obligations arising as a result of the actions of the person to whom the power of attorney was issued before this person knew or should have known about its termination remain valid for the issuer of the power of attorney and his successors in relation to third parties. This rule does not apply if the third party knew or should have known that the power of attorney had terminated.

3. Upon termination of the power of attorney, the person to whom it was issued or his legal successor must immediately return the power of attorney.

4. With the termination of the power of attorney, the transfer of powers under this power of attorney to another person (subassignment) also loses force.

Chapter 6. Calculation of deadlines

Article 172. Determination of the period

1. The period established by law, a transaction, or appointed by the court, is determined by a calendar date or an indication of an event that must inevitably occur.

2. The term can also be established as a period of time, which is calculated in years, months, weeks, days or hours.

Article 173. Beginning of a period determined by a period of time

The course of a period defined by a period of time begins on the next day after the calendar date or occurrence of the event that determines its beginning.

Article 174. Expiration of a period determined by a period of time

1. A term calculated in years expires on the corresponding month and day of the last year of the term.

For a period calculated in six months, the rules for periods calculated in months apply.

2. For periods calculated in quarters of the year, the rules for periods calculated in months apply. In this case, a quarter is considered equal to three months, and quarters are counted from the beginning of the year.

3. A period calculated in months expires on the corresponding date of the last month of the term.

A period determined in half a month is considered as a period calculated in days and is considered equal to fifteen days.

If the end of a period calculated in months falls on a month in which there is no corresponding date, then the period expires on the last day of that month.

4. A period calculated in weeks expires on the corresponding day of the last week of the term.

Article 175. Expiration of a period on a non-working day

If the last day of the term falls on a non-working day, the end of the term is considered to be the next working day following it.

Article 176. Procedure for performing actions on the last day of the term

1. If a time limit is set for the performance of any action, it can be performed until twenty-four hours of the last day of the time limit.

However, if this action must be performed in an organization, then the period expires at the hour when the corresponding operations in this organization, according to established rules, cease.

2. Written statements and notices submitted to the post office, telegraph or other communication institution before twenty-four hours of the last day of the deadline are considered made on time.

Chapter 7. Limitation period

Article 177. The concept of limitation of actions

1. The limitation period is the period of time during which a claim arising from violations of a person’s right or legally protected interest can be satisfied.

2. The limitation periods and the procedure for calculating them are provided for by law and cannot be changed by agreement of the parties.

Article 178. Limitation periods

1. The general limitation period is set at three years.

2. For certain types of claims, legislative acts may establish special limitation periods, shorter or longer than the general period.

3. The rules of Articles 177, 179-186 of this Code also apply to special limitation periods, unless otherwise provided by legislative acts.

Article 179. Application of the limitation period

1. A claim for the protection of a violated right is accepted for consideration by the court regardless of the expiration of the limitation period.

2. The limitation period is applied by the court only upon the application of a party to the dispute made before the court makes a decision.

3. The expiration of the limitation period before filing a claim is the basis for the court to make a decision to reject the claim.

With the expiration of the limitation period for the main claim, the limitation period for additional claims (for the collection of a penalty, for the liability of the guarantor, etc.) expires.

Article 180. Expiration of the limitation period

1. The limitation period begins from the day when the person learned or should have learned about the violation of the right. Exceptions from this rule are established by this Code and other legislative acts.

2. For obligations with a certain period of performance, the limitation period begins at the end of the period of performance.

3. For obligations for which the deadline for fulfillment is not defined or is determined by the moment of demand, the limitation period begins from the moment the demand for fulfillment of the obligation is presented, and if the debtor is given a grace period for fulfilling such a requirement, the calculation of the limitation period begins at the end of the specified period (clause 2 of Article 277 of this Code).

4. For recourse obligations, the limitation period begins from the moment of fulfillment of the main obligation.

Article 181. Limitation period for cases of change of persons in the obligation

A change of persons in an obligation does not entail a change in the limitation period or the procedure for calculating it.

Article 182. Suspension of the limitation period

1. The limitation period is suspended:

1. if the filing of a claim was prevented by an extraordinary and unpreventable event under the given conditions (force majeure);

2. due to the postponement of fulfillment of obligations of this type (moratorium) announced by the President of the Republic of Kazakhstan;

3. if the plaintiff or defendant is part of military units transferred to martial law;

4. if the incapacitated person does not have a legal representative;

5. due to the suspension of the legislation regulating the relevant relationship;

6. when checking the legality of the sources of acquisition (origin) of an asset in accordance with the legislation of the Republic of Kazakhstan on the return of illegally acquired assets to the state.

For claims for compensation for harm caused to the life or health of a citizen, the limitation period is also suspended in connection with the citizen’s appeal to the relevant organizations for the appointment and/or implementation of pension payments or the assignment of benefits - before the appointment and/or implementation of pension payments or the assignment of benefits or refusal to assign and/or implementation of pension payments or the assignment of benefits.

2. The running of the limitation period is suspended if the circumstances specified in this article arose or continued to exist in the last six months of the limitation period, and if this period does not exceed six months - during the limitation period.

3. From the date of termination of the circumstance that led to the suspension, the limitation period continues. In this case, the remaining part of the period is extended to six months, and if the limitation period does not exceed six months - to the statute of limitations.

Footnote. Article 182 as amended by the laws of the Republic of Kazakhstan dated July 19, 1997 No. 134; dated 03/02/1998 No. 134; dated 07/12/2023 No. 23-VIII (shall be enforced upon expiration of ten calendar days after the day of its first official publication).

Article 183. Interruption of the limitation period

1. The running of the limitation period is interrupted by the filing of a claim in the prescribed manner, the conclusion by the parties of a mediation agreement, as well as the performance by the obligated person of actions indicating the recognition of a debt or other obligation.

2. After the break, the limitation period begins anew; the time elapsed before the break does not count towards the new term.

Footnote. Article 183 as amended by the Law of the Republic of Kazakhstan dated January 28, 2011 No. 402-IV (enters into force from 08/05/2011).

Article 184. Expiration of the limitation period if the claim is left without consideration

1. If the claim is left by the court without consideration, the running of the limitation period that began before the filing of the claim continues in the general manner.

2. If the court leaves without consideration a claim brought in a criminal case, then the running of the limitation period, which began before the filing of the claim, is suspended until the verdict by which the claim was left without consideration enters into legal force. The time during which the limitation period was suspended does not count towards the limitation period. Moreover, if the remaining part of the period is less than six months, it is extended to six months.

Article 185. Reinstatement of the limitation period

1. In exceptional cases, when the court recognizes a valid reason for missing the statute of limitations due to circumstances related to the personality of the plaintiff (serious illness, helpless state, illiteracy, etc.), the violated right of a citizen is subject to protection. Reasons for missing the limitation period may be considered valid if they occurred in the last six months of the limitation period, and if this period is six months or less than six months, during the limitation period.

2. The limitation period is restored and begins to run again in cases where the plaintiff has, in accordance with legislative acts, the right to bring a new claim in the same case in connection with the refusal to enforce a court decision in this case.

Article 186. Fulfillment of an obligation after the expiration of the limitation period

A debtor or other obligated person who has fulfilled an obligation after the expiration of the limitation period does not have the right to demand that the performance be returned, even if at the time of fulfillment the specified person did not know about the expiration of the limitation period.

Article 187. Claims to which the limitation period does not apply

The limitation period does not apply:

1. to demands for the protection of intangible benefits and personal non-property rights, except for cases provided for by legislative acts;

2. on depositors’ demands to the bank for the issuance of bank deposits;

3. on claims for compensation for harm caused to the life or health of a citizen. However, claims brought after the expiration of the limitation period are satisfied no more than three years prior to the filing of the claim;

4. to the demands of the owner or other legal possessor to eliminate any violations of his rights, if these violations were not combined with deprivation of possession (Articles 264, 265 of this Code);

5. in cases established by legislative acts - and for other requirements.

Footnote. Article 187 was amended by Law of the Republic of Kazakhstan dated July 11, 1997 No. 154.

SECTION 2. OWNERSHIP AND OTHER RIGHTS

REAL RIGHTS Chapter 8. General provisions on property rights and other property rights

Footnote. The title of Chapter 8 as amended by the Law of the Republic of Kazakhstan dated 02/27/2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 188. Concept and content of property rights

1. The right of ownership is the right of a subject, recognized and protected by legislative acts, to own, use and dispose of property belonging to him at his own discretion.

Ownership is transferred to another person with all encumbrances existing at the time of the transaction.

2. The owner has the rights to own, use and dispose of his property.

The right of possession is a legally enforceable opportunity to exercise actual possession of property.

The right of use is a legally enforceable opportunity to extract from the property its beneficial natural properties, as well as to receive benefits from it. The benefit can be in the form of income, increment, fruits, offspring and other forms.

The right of disposal is a legally enforceable opportunity to determine the legal fate of property.

3. The owner has the right, at his own discretion, to perform any actions in relation to the property belonging to him, including alienating this property into the ownership of other persons, transferring to them, while remaining the owner, his powers to own, use and dispose of property, pledging the property and encumbering it in other ways, and disposing of it in other ways.

4. The exercise by the owner of his powers must not violate the rights and legally protected interests of other persons and the state. Violation of rights and legitimate interests can find expression, along with other forms, in the owner’s abuse of his monopoly or other dominant position.

The owner is obliged to take measures to prevent damage to the health of citizens and the environment that may be caused during the exercise of his rights.

5. Ownership is indefinite. Ownership of property can be forcibly terminated only on the grounds provided for by this Code.

6. In cases, on the terms and within the limits provided for by legislative acts, the owner is obliged to allow limited use of his property by other persons.

Footnote. Paragraph 1 of Article 188 is supplemented by a paragraph - Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 189. Burden of maintaining property

1. The owner bears the burden of maintaining the property he owns, unless otherwise provided by legislative acts or agreement, and cannot unilaterally shift such a burden to a third party.

2. If the property was legally owned by third parties, then the expenses incurred by them for the maintenance of someone else’s property are subject to compensation by the owner, unless otherwise provided by the contract.

Expenses for maintaining property are not reimbursed to a person who possessed the thing in bad faith and unlawfully (Article 263 of this Code).

Article 190. Risk of accidental loss or accidental damage to property

1. The risk of accidental loss or accidental damage to alienated items passes to the acquirer simultaneously with the emergence of his right of ownership, unless otherwise established by legislative acts or an agreement.

2. If the alienator is guilty of delay in transferring things or the acquirer is guilty of delay in accepting them, the risk of accidental loss or accidental damage is borne by the delayed party.

Article 191. Concept and types of private property

1. Private property acts as the property of citizens and non-state legal entities and their associations.

2. Any property may be privately owned, with the exception of certain types of property that, in accordance with legislative acts, cannot belong to citizens or legal entities.

The number and value of privately owned property is not limited.

Footnote. Article 191 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 192. Right of state property

1. State property acts in the form of republican and communal property.

2. Republican property consists of the state treasury and property assigned to state republican legal entities in accordance with legislative acts.

Funds from the republican budget and other state property not assigned to state legal entities constitute the state treasury of the Republic of Kazakhstan.

3. Communal property consists of the local treasury and property assigned to communal legal entities in accordance with legislative acts.

Local budget funds and other communal property not assigned to state legal entities constitute the local treasury.

RCPI note! This version of paragraph 3-1 is valid from 01/01/2018 for cities of district significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 07/11/2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

3-1. Communal property is divided according to the levels of local government and self-government into:

regional, cities of republican significance, capitals;

district (city of regional significance);

cities of district significance, villages, towns, rural districts (municipal property of local government).

4. State-owned property may be assigned to state legal entities with the right of economic management or operational management.

5. Features of the legal regime of state property managed by individual state institutions are determined by legislative acts.

6. The transfer of state property from one type of state property to another is carried out in accordance with the legislative act of the Republic of Kazakhstan on state property.

Voluntary and gratuitous transfer of property from private property to state property is carried out in the manner determined by the legislative act of the Republic of Kazakhstan on state property.

RCPI note! This version of part three of paragraph 6 is valid from 01/01/2018 for cities of regional significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 07/11/2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

The transfer of property in communal ownership from one level of local government and self-government to another is carried out in accordance with the legislative act of the Republic of Kazakhstan on state property.

7. The provisions of this article apply accordingly to civil rights to state property other than the right of ownership, unless otherwise provided by the legislative act of the Republic of Kazakhstan on state property or does not contradict the essence of civil rights.

Footnote. Article 192 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 No. 211; dated 04.11.1999 No. 472; dated 03/02/2001 No. 162; dated 21.05.2002 No. 323; dated 05/18/2005 N 50; dated 12.01.2007 No. 225 (shall be enforced from the date of its official publication); dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated July 11, 2017 No. 90-VI (the order of enforcement see clause 1) clause 1, article 2); dated 05.11.2022 No. 157-VII (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 193. Ownership of land and other natural resources

The land and its subsoil, water, flora and fauna, and other natural resources belong to the people of Kazakhstan. On behalf of the people of Kazakhstan, property rights are exercised by the state.

At the same time, the exercise of property rights by the state is realized through the state property regime in the interests of the people of Kazakhstan.

Land may also be privately owned on the grounds, conditions and within the limits established by law.

Footnote. Article 193 as amended - as amended by the Law of the Republic of Kazakhstan dated 05.11.2022 No. 157-VII (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 193-1. Strategic objects

1. A strategic object is property that has socio-economic significance for the sustainable development of Kazakhstani society, the possession and (or) use and (or) disposal of which will influence the state of national security of the Republic of Kazakhstan.

2. Strategic objects may include: main railway networks; main pipelines; national electrical grid; trunk communication lines; television and radio broadcasting facilities (production and technological complex of terrestrial and satellite television and radio broadcasting systems); oil refineries; energy-producing facilities with a capacity of at least 50 megawatts; national postal network; international airports; seaports with the status of international importance; aeronautical devices of the air traffic control system; devices and navigational signs that regulate and guarantee the safety of navigation; nuclear energy facilities; stationary potentially hazardous biological facilities where pathogenic biological agents of pathogenicity group I are handled; objects of the space industry; water management and hydraulic structures; public roads; property complex of the organization of the military-industrial complex; as well as blocks of shares (participatory interests, shares) in legal entities that own strategic objects, blocks of shares (participatory interests, shares) of individuals and legal entities that have the ability to directly or indirectly determine decisions or influence decisions made by legal entities that own strategic objects.

Strategic objects can be in state and private ownership in accordance with the legislative acts of the Republic of Kazakhstan.

3. Encumbrance of strategic objects with the rights of third parties or their alienation is possible on the basis of a decision of the Government of the Republic of Kazakhstan to issue a permit and in the manner determined by the legislative act of the Republic of Kazakhstan on state property, unless otherwise provided by the legislative acts of the Republic of Kazakhstan.

4. In cases of the intention of a citizen or non-state legal entity to complete a transaction for the alienation of a strategic object, as well as the foreclosure of a strategic object, or the alienation of a strategic object by a rehabilitation or bankruptcy manager, or the sale of pledged property (strategic object) by the mortgagee out of court, or the foreclosure of a strategic object on the basis of a judicial act, the Republic of Kazakhstan has a priority right to acquire a strategic object on the terms determined by the legislative act of the Republic of Kazakhstan on state property.

The market value of a strategic object is determined in accordance with the legislation of the Republic of Kazakhstan on valuation activities and the legislative act of the Republic of Kazakhstan on state property.

The procedure for using the priority right to acquire a strategic object is determined by the legislative act of the Republic of Kazakhstan on state property.

5. If, when encumbering a strategic object with the rights of third parties or its alienation, the requirements of paragraphs 3 and 4 of this article are violated, such transactions are void.

Footnote. The Code is supplemented by Article 193-1 in accordance with the Law of the Republic of Kazakhstan dated 07.08.2007 N 321 (shall be enforced from the date of its official publication); as amended by the laws of the Republic of Kazakhstan dated 13.02.2009 N 135-IV (for the order of enforcement, see st.3); dated 01.03.2011 № 414-IV (shall be enforced from the date of its first official publication); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 06.22.2012 № 21-V (shall be enforced upon the expiration of ten calendar days after its first official publication); dated 03/07/2014 No. 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 05.21.2022 No. 123-VII (shall be enforced six months after the date of its first official publication); dated 12/23/2023 No. 51-VIII (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 04/09/2025 No. 179-VIII (entered into effect after sixty calendar days after the day of its first official publications).

Article 194. Ownership and other proprietary rights to housing

Features of the exercise of ownership and other property rights to housing are regulated by housing legislation.

Article 195. Property rights of persons who are not owners

1. Property rights, along with the right of ownership, include:

1. land use right;

2. right of economic management;

3. the right of operational management;

3-1) the right to limited targeted use of someone else’s real estate (easement);

4. other property rights provided for by this Code or other legislative acts.

2. The rules on property rights are applied to property rights, unless otherwise provided by law or does not contradict the nature of the given property right.

3. The transfer of ownership of property to another person is not the basis for the termination of other proprietary rights to this property, unless otherwise provided by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 195 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); dated March 25, 2011 No. 421-IV (shall be enforced ten calendar days after its first official publication).

Chapter 9. Right of economic management

Article 196. The right of economic management of a state enterprise

1. The right of economic management is the real right of a state enterprise that has received property from the state as the owner and exercises, within the limits established by this Code and other legislative acts of the Republic of Kazakhstan, the rights of ownership, use and disposal of this property.

2. Features of the exercise of the right of economic management by state-owned enterprises are determined by the legislative act of the Republic of Kazakhstan on state property.

Footnote. Article 196 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 197. Object of economic management rights

The object of the right of economic management can be any property, unless otherwise provided by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 197 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 198. Acquisition and termination of the right of economic management

1. The right of economic management to property in respect of which the owner has decided to assign it to an already created state enterprise arises for this enterprise at the time the property is assigned to the independent balance sheet of the enterprise, unless otherwise established by law or by a decision of the owner.

2. Fruits, products and income from the use of property under economic control, as well as property acquired by an enterprise under contracts or other grounds, shall come under the economic control of the enterprise in the manner established by law for the acquisition of ownership rights.

3. The right of economic management to property is terminated on the grounds and in the manner prescribed by law for the termination of ownership rights, as well as in cases of lawful seizure of property from an enterprise by decision of the owner.

Article 199. Rights of the owner in relation to property under economic management

The owner of property under economic management, in accordance with legislative acts, resolves issues of creating an enterprise, determining the subject and goals of its activities, its reorganization and liquidation, and exercises control over the use for its intended purpose and the safety of property belonging to the enterprise.

The owner has the right to receive a portion of the net income from the use of property under the economic control of the enterprise he created.

Footnote. Article 199 was amended by Law of the Republic of Kazakhstan dated July 11, 1997 No. 154.

Article 200. Conditions for the exercise of property rights of a state enterprise

1. A state enterprise operating under the right of economic management, unless otherwise provided by legislative acts, has no right, without the written consent of the owner or a state body authorized by him:

1. alienate or otherwise dispose of (except for the cases provided for in this article), lease out long-term lease (over three years), provide for temporary free use buildings, structures, equipment and other fixed assets of the enterprise belonging to him;

2. create branches, representative offices, establish enterprises and joint ventures together with private entrepreneurs, invest their production and monetary capital in them;

2-1) dispose of the shares belonging to him (except for the cases provided for in this article), as well as receivables;

3. provide loans;

4. issue a surety or guarantee for the obligations of third parties.

2. A state enterprise, unless otherwise provided by the legislative acts of the Republic of Kazakhstan, independently disposes of the property assigned to it under the right of economic management, which is not related to fixed assets.

A state enterprise, with the right of economic management, does not have the right to sell and enter into donation transactions in relation to property related to the fixed assets of the state enterprise, as well as shares owned by it.

Footnote. Article 200 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 N 154; dated 03/02/1998 N 211; dated May 21, 2002 N 323; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 201. Extension of provisions on property rights to relations involving state-owned enterprises

Property relations with the participation of state-owned enterprises are subject to the provisions of this Code on property rights, unless otherwise follows from this Code and other legislative acts.

Chapter 10. Right of operational management

Article 202. Concept and content of law

1. The right of operational management is the real right of an institution financed at the expense of the owner, and a state-owned enterprise that has received property from the owner and exercises, within the limits established by the legislative acts of the Republic of Kazakhstan, in accordance with the goals of its activities, the tasks of the owner and the purpose of the property, the right to own, use and dispose of this property.

RCPI note! This version of paragraph 2 is valid from 01/01/2018 for cities of regional significance, villages, towns, rural districts with a population of more than two thousand people in accordance with the Law of the Republic of Kazakhstan dated 07/11/2017 No. 90-VI (current version until 01/01/2020 for cities of regional significance, villages, towns, rural districts with a population of two thousand or less people, see the archived version dated 12/25/2017 of the Civil Code of the Republic of Kazakhstan dated 12/27/1994 No. 268-XIII).

2. Features of the exercise of the right to operational management of state-owned enterprises and state institutions are determined by the laws of the Republic of Kazakhstan “On State Property” and “On Local State Administration and Self-Government in the Republic of Kazakhstan”.

Footnote. Article 202 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated December 16, 1998 N 320; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated July 11, 2017 No. 90-VI (for the order of enforcement, see clause 1) clause 1, article 2).

Article 203. Acquisition and termination of the right of operational management

The acquisition and termination of the right of operational management is carried out under the conditions and in the manner provided for in Chapters 13 and 14 of this Code, unless otherwise established by legislative acts Republic of Kazakhstan.

Footnote. Article 203 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 204. Rights of the owner of property transferred to operational management

1. The owner of property under operational management, in accordance with the legislative acts of the Republic of Kazakhstan, decides on the issues of creating an institution, a state-owned enterprise, determining the subject and goals of its activities, has the right to determine the legal fate of the institution, a state-owned enterprise, and the content of its activities.

2. The owner exercises control over the efficiency of use and safety of the property transferred by the owner by the institution, government enterprise.

3. If an institution is created by several owners, the relations between them and the rights of the owners to manage their property are determined by the constituent agreement or a similar agreement.

Footnote. Article 204 as amended by the laws of the Republic of Kazakhstan dated December 16, 1998 No. 320; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 205. The owner’s right to withdraw and redistribute property transferred to operational management

The owner of property assigned to an institution or state-owned enterprise has the right to withdraw this property or redistribute it among other legal entities created by him at his own discretion, unless otherwise established by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 205 as amended by the laws of the Republic of Kazakhstan dated December 16, 1998 No. 320; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 206. Disposal of the property of an institution

Note FROM! Part 1 of Article 206 provides for an amendment by the Law of the Republic of Kazakhstan dated June 10, 2026 No. 301-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

An institution does not have the right to independently alienate or otherwise dispose of the property assigned to it and property acquired from funds allocated to it according to the estimate.

Features of the implementation of income-generating activities by state institutions are established by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 206 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 207. Liability of the founder for the debts of a state-owned enterprise and institution

Footnote. The title of Article 207 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

1. A state-owned enterprise is liable for its obligations with the money at its disposal.

If a state-owned enterprise does not have enough money, the Republic of Kazakhstan or an administrative-territorial unit bears subsidiary liability for its obligations with funds from the corresponding budget.

2. The responsibility of the institution arises in the manner prescribed by paragraph 1 of Article 44 of this Code.

Footnote. Article 207 as amended by the Law of the Republic of Kazakhstan dated December 16, 1998 N 320; as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Article 208. Transfer of ownership of an institution

When the ownership of an institution is transferred to another person, this institution retains the right of operational management of its property.

Chapter 11. Common property

Article 209. Concept and grounds for the emergence of common property

1. Property owned by two or more persons belongs to them under the right of common ownership.

2. Property may be in common ownership with the determination of the share of each owner in the right of ownership (shared ownership) or without determination of such shares (joint ownership).

3. Common ownership of property is shared, except for cases where the law provides for the formation of joint ownership of property.

4. Common property arises when two or more persons acquire property that cannot be divided without changing its purpose (indivisible things), or is not subject to division by force of law.

Common ownership of divisible property arises in cases provided for by legislative acts or agreement.

5. By agreement of the participants in joint ownership, and if no agreement is reached, by a court decision, shared ownership of these persons may be established on the common property.

6. Ownership of real estate may arise in the form of a condominium, in which certain parts of the real estate are individually (separately) owned by citizens and (or) legal entities, and those parts of the real estate that are not separately owned belong to the owners of parts of the real estate on the right of common shared ownership.

The share of each owner in the common property is inseparable from his separate ownership of the part of the real estate belonging to him.

The size of each owner’s share in the common property and the degree of participation in the costs of its maintenance depend on the size of the parts of the property that are individually (separately) owned, unless otherwise provided by legislative acts or agreement.

Features of the legal regime of different types of condominium can be determined by legislative acts.

7. Features of the legal regime of common shared ownership of the assets of a mutual investment fund are determined by the legislative act of the Republic of Kazakhstan on investment and venture funds.

Footnote. Article 209 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 No. 211; dated 07.07.2004 No. 577; dated 04.07.2018 No. 174-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 210. Determination of shares in the right of shared ownership

1. If the size of shares of participants in shared ownership cannot be determined on the basis of legislative acts and is not established by agreement of all its participants, the shares are considered equal.

2. By agreement of all participants in shared ownership, a procedure for determining and changing their shares may be established depending on the contribution of each of them to the formation and growth of common property.

Article 211. Rights of a participant in shared ownership related to its improvement

1. A participant in shared ownership who has carried out inseparable improvements at his own expense in compliance with the established procedure for using the common property has the right to a corresponding increase in his share in the right to the common property.

2. Separable improvements to common property, unless otherwise provided by the agreement of the participants in shared ownership, shall become the property of the participant who made them.

Article 212. Disposal of property in shared ownership

1. The disposal of property in shared ownership is carried out by agreement of all its participants.

2. Each participant in shared ownership has the right, at his own discretion, to sell, donate, bequeath, pledge his share, or otherwise dispose of it in compliance with the conditions provided for in Article 216 of this Code.

Article 213. Possession and use of property in shared ownership

1. Possession and use of property in shared ownership is carried out with the consent of all its participants, and if no agreement is reached, in the manner established by the court.

2. Each participant in shared ownership has the right to be given for his possession and use a part of the common property commensurate with his share, and if this is not possible, he has the right to demand from other participants who own and use the property the payment of an appropriate sum of money or other compensation due to his share.

Article 214. Fruits, products and income from the use of property in shared ownership

Fruits, products and income from the use of property that is in shared ownership are included in the common property. Subsequent distribution of fruits, products and income is made between the participants in shared ownership in proportion to their shares, unless otherwise provided by an agreement between them.

Article 215. Expenses for the maintenance of property in shared ownership

Each participant in shared ownership is obliged, in proportion to his share, to participate in the payment of taxes, fees and other payments on the common property, as well as in the costs of its maintenance and preservation.

Article 216. Pre-emptive right to purchase

1. When selling a share in the right of shared ownership to an outsider, the remaining participants in the shared ownership have the preemptive right to purchase the sold share at the price for which it is sold and on other equal conditions, except in the case of sale at public auction.

Public auctions for the sale of a share in the right of shared ownership in the absence of consent of all participants in shared ownership may be held in the cases provided for in clause 2 of Article 222 of this Code, and in other cases provided for by legislative acts.

2. The seller of a share is obliged to notify in writing the other participants in shared ownership of his intention to sell his share to an outsider, indicating the price and other conditions under which he sells it. If the remaining participants in shared ownership refuse to purchase or do not acquire the sold share in the ownership of real estate within a month, and in relation to other property - within ten days from the date of receipt of the notice, the seller has the right to sell his share to any person.

3. When selling a share in violation of the pre-emptive right, any other participant in shared ownership has the right, within three months, to demand in court that the rights and obligations of the buyer be transferred to him.

4. Assignment of the pre-emptive right to purchase a share is not permitted.

5. The rules of this article also apply when alienating a share under an exchange agreement.

6. The rules of this article do not apply to cases of alienation of strategic objects.

Footnote. Article 216 as amended by the Law of the Republic of Kazakhstan dated August 7, 2007 N 321 (shall be enforced from the date of its official publication).

Article 217. Moment of transfer of a share in the right of shared ownership to the acquirer under an agreement

The share in the right of shared ownership passes to the acquirer under the contract from the moment the contract is concluded, unless otherwise provided by agreement of the parties.

The moment of transfer of a share in the right of shared ownership under an agreement subject to state registration or notarization is determined in accordance with clause 2 of Article 238 of this Code.

Article 218. Division of property in shared ownership and allocation of a share from it

1. Property in shared ownership may be divided between its participants by agreement between them.

2. A participant in shared ownership has the right to demand the allocation of his share from the common property.

3. If the participants in shared ownership fail to reach an agreement on the method and conditions for the division of common property or the allocation of the share of one of them, the participant in shared ownership has the right to demand the allocation in kind of his share from the common property.

If the allocation of a share in kind is not permitted by legislative acts or is impossible without disproportionate damage to property in common ownership, the allocated owner has the right to have the cost of his share paid to him by other participants in shared ownership.

4. The disproportion between the property allocated in kind to a participant in shared ownership on the basis of this article and his share in the right of ownership shall be eliminated by payment of an appropriate sum of money or other compensation.

Payment of compensation to a participant in shared ownership by the remaining co-owners instead of allocating his share in kind is permitted with his consent. In cases where the share of the corresponding owner is insignificant, cannot be realistically allocated and he does not have a significant interest in the use of the common property, the court may, even in the absence of the consent of this owner, oblige the remaining participants in the shared ownership to pay him compensation.

5. Upon receipt of compensation in accordance with paragraphs 3 and 4 of this article, the owner loses the right to a share in the common property.

6. If it is impossible to divide common property or allocate a share from it according to the rules set out in paragraphs 3 and 4 of this article, the court decides to sell the property with public auction with the subsequent distribution of the proceeds among the participants in the common property in proportion to their shares.

Footnote. Article 218 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 219. Common joint property

1. Common joint property exists in the form of:

1. common property of spouses;

2. common property of members of the peasant farm;

3. common ownership of privatized housing.

2. Legislative acts may provide for other types of common joint property.

3. Common joint property is established and exists, unless otherwise provided by an agreement between its participants.

Footnote. Article 219 as amended by the Law of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication).

Article 220. Possession, use and disposal of jointly owned property

1. Participants in joint ownership, unless otherwise provided by agreement between them, jointly own and use common property.

2. The disposal of jointly owned property is carried out by the consent of all participants, which is assumed regardless of which of the participants made the transaction to dispose of the property.

3. Each of the participants in joint ownership has the right to enter into transactions for the disposal of common property, unless otherwise follows from the agreement of all participants. A transaction related to the disposal of common property made by one of the participants in joint ownership may be declared invalid at the request of the remaining participants on the grounds that the participant who made the transaction lacked the necessary powers only if it is proven that the other party to the transaction knew or should have known about it.

When making transactions that require notarization or state registration, the consent of other participants in joint ownership to complete the transaction must be confirmed by a notary.

4. Paragraphs 1-3 of this article apply unless otherwise established by this Code or other legislative acts for certain types of joint ownership.

Article 221. Division of jointly owned property and allocation of a share from it

1. The division of common property between the participants in joint ownership, as well as the allocation of the share of one of them, can be carried out subject to the preliminary determination of the share of each of the participants in the right to the common property.

2. When dividing common property and separating a share from it, unless otherwise provided by legislative acts or agreement of the participants, their shares are recognized as equal.

3. The grounds and procedure for the division of common property and the allocation of a share from it are determined according to the rules of Article 218 of this Code, since otherwise for certain types of joint property is not established by this Code, other legislative acts and does not follow from the essence of the relations of participants in joint property.

Footnote. Article 221 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 222. Levy of execution on a share in common property

1. The creditor of a participant in shared or joint ownership, if the latter has insufficient other property, has the right to make a demand for the allocation of the debtor’s share in the common property for foreclosure on it.

2. In cases where the remaining participants in the common property refuse to acquire the debtor’s share, the creditor has the right to demand in court the foreclosure of the debtor’s share in the right of common ownership by selling this share at public auction.

3. If in such cases the allocation of a share in kind is impossible or the remaining participants in shared or joint ownership object to this, the creditor has the right to demand that the debtor sell his share to the remaining participants in the common property at a price commensurate with the market value of this share, with the proceeds from the sale being used to repay the debt.

Article 223. Common property of spouses

1. Property acquired by spouses during marriage is their joint property, unless an agreement between them stipulates that this property is the shared property of the spouses or belongs alone or in appropriate parts to each of the spouses by right of ownership.

2. Property that belonged to spouses before marriage, as well as property received by them during marriage as a gift or by inheritance, is the property of each of them.

Items for personal use (clothing, shoes, etc.), with the exception of jewelry and other luxury items, although acquired during marriage at the expense of the spouses’ common funds, are recognized as the property of the spouse who used them.

The property of each spouse may be recognized as their joint property if it is established that during the marriage, investments were made at the expense of the spouses’ common property that significantly increased the value of this property (major repairs, reconstruction, re-equipment, etc.).

3. For the obligations of one of the spouses, recovery may be made only on the property owned by him, as well as on his share in the common property of the spouses, which would be due to him upon division of this property.

4. The specifics of the right of common joint property of spouses are determined by the legislation on marriage and family of the Republic of Kazakhstan.

Footnote. Article 223 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 224. Property of a peasant or farm enterprise

1. The property of a peasant farm belongs to its members on the right of joint ownership, unless otherwise established by an agreement between them.

The property of a farm organized in the form of a simple partnership on the basis of a joint activity agreement belongs to its members on the right of common shared ownership.

The property of a farm based on personal entrepreneurship belongs to him on the right of private ownership.

2. Members of a peasant or farm enterprise may own land plots, plantings on a land plot, including plantings of a private forest fund, wild animals bred and kept in captivity and (or) semi-free conditions, plant genetic resources, outbuildings and other buildings, reclamation and other structures, productive and working livestock, poultry, agricultural and other machinery and equipment, vehicles, inventory and other property transferred by members of the farm and (or) acquired for the farm using the common funds of its members.

3. Fruits, products and income received as a result of the activities of a peasant or farm enterprise are the common property of the members of the peasant or farm enterprise and are used by agreement between them.

Footnote. Article 224 as amended by the Law of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); as amended by the Law of the Republic of Kazakhstan dated 01/02/2023 No. 184-VII (shall be brought into force sixty calendar days after the day of its first official publication).

Article 225. Division of property of a peasant or farm enterprise

1. Upon termination of a peasant or farm enterprise due to the withdrawal of all its members or for other reasons, the common property is subject to division according to the rules provided for in Article 218 and 221 of this Code.

2. The means of production belonging to a peasant or farm enterprise are not subject to division when one of its members leaves the enterprise. Those who leave the farm have the right to receive monetary compensation commensurate with their share in the common ownership of this property.

3. In the cases provided for in paragraphs 1 and 2 of this article, the shares of members of a peasant or farm enterprise in the right of joint ownership of the farm’s property are recognized as equal, unless otherwise established by agreement between them.

Footnote. Article 225 as amended by the Law of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication).

Article 226. Legal regime of property during the reorganization of a peasant or farm enterprise into a business partnership or cooperative

1. Members of a peasant or farm enterprise may create a business partnership or production cooperative on the basis of the property of the farm. Such a reorganized peasant or farm enterprise, as a legal entity, has the right of ownership to property transferred to it in the form of contributions and other contributions by members of the peasant or farm enterprise, as well as to property received as a result of its activities and acquired on other grounds that do not contradict the law.

2. The amount of contributions of members of a peasant or farm enterprise who are participants in a partnership or members of a cooperative is established based on their shares in the right of common ownership of the property of a peasant or farm enterprise, determined in the manner prescribed by Article 218 or paragraph 3 of Article 225 of this Code.

Footnote. Article 226 as amended by the Law of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication).      

Article 227. Common ownership of privatized housing

Housing purchased or acquired free of charge by the tenant in accordance with the legislation of the Republic of Kazakhstan on state property and housing relations in the houses of the state housing stock passes into the joint ownership of the tenant and family members permanently residing with him, including minors and temporarily absent ones, unless otherwise provided by an agreement between them.

The specifics of the right of joint ownership of privatized housing are determined by legislative acts on housing relations.

Footnote. Article 227 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

Chapter 12. Agreement on joint activities

(simple partnership)

Article 228. Simple partnership

1. A simple partnership is formed on the basis of an agreement on joint activities.

Under a joint activity agreement (simple partnership agreement), the parties undertake to act jointly to generate income or achieve another goal that does not contradict the law.

A simple partnership is not a legal entity.

2. An agreement on joint activities (a simple partnership agreement) is concluded between citizens, citizens and legal entities, between legal entities (consortium).

3. The obligations of the participants of a simple partnership related to the agreement on joint activity to third parties are joint and several, unless otherwise provided by the agreement on joint activity.

Footnote. Article 228 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 229. Conducting common affairs of the parties to the agreement

The conduct of common affairs of the participants in a joint activity agreement is carried out by their common consent. By agreement among themselves, they can entrust the management of joint activities and the conduct of common affairs to one of the participants, acting in this case on the basis of a power of attorney issued by the other parties to the agreement, or to a third party in cases provided for by Article 823 of this Code and the legislation of the Republic of Kazakhstan on project financing and securitization.

Footnote. Article 229 - as amended by the Law of the Republic of Kazakhstan dated 01/02/2021 No. 399-VI (shall be enforced upon expiration of ten calendar days after the day of its first official publication).

Article 230. Common property of the parties to the agreement

1. To achieve their goals, the participants in a joint activity agreement make contributions in money or other property or through labor contribution.

2. Cash or other property contributions of the parties to the agreement, as well as property created or acquired as a result of their joint activities, are their common shared property.

3. (deleted)

4. The property of the parties to the agreement is subject to the norms of this Code on common shared ownership, unless otherwise provided by the norms of this chapter, other legislative acts or the agreement on joint activity.

Footnote. Article 230 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 231. General expenses and losses of parties to the agreement

The procedure for covering general expenses for joint activities and losses resulting from them is determined by the agreement of the participants. If the agreement does not provide for such a procedure, general expenses and losses are covered from the common property of the parties to the agreement, and the missing amounts are distributed between them in proportion to their shares in this property.

Footnote. Article 231 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 232. Transfer of rights and refusal to participate in joint activities

1. The transfer of the right to participate in a joint activity can be carried out only with the consent of the parties to the agreement on joint activity (simple partnership agreement).

2. A participant in a joint activity agreement (simple partnership agreement) has the right, at his own discretion, to refuse to participate in the joint activity.

3. Losses of participants caused by the refusal of any of them to participate in joint activities are recovered in full, unless otherwise provided by the agreement on joint activities (simple partnership agreement).

Article 233. Consortium

1. A consortium is a temporary voluntary equal union (association) based on an agreement on joint economic activity, in which legal entities combine certain resources and coordinate efforts to solve specific economic problems.

2. Consortium participants retain their economic independence and can take part in the activities of other consortia and associations.

Relations between the consortium participants are built on a contractual basis.

3. The management of the consortium is carried out in accordance with the consortium agreement of the consortium participants.

4. Consortium participants bear joint liability for obligations related to the activities of the consortium, unless otherwise specified in the consortium agreement.

5. The consortium ceases its activities upon completion of the assigned task or by decision of its participants.

Footnote. Article 233 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 234. Rules on certain types of joint activities

Certain types of joint activities are regulated in accordance with this Code by the legislation of the Republic of Kazakhstan.

Chapter 13. Acquisition of ownership rights

and other real rights

Article 235. Grounds for acquiring ownership rights

1. The right of ownership to a new thing belongs to the person who manufactured or created it, unless otherwise provided by the contract or legislation.

The right of ownership to fruits, products, income received as a result of the use of property is acquired in accordance with Article 123 of this Code.

2. The right of ownership to property that has an owner may be acquired by another person on the basis of a contract of sale, exchange, donation or other transaction for the alienation of this property.

In the event of the death of a citizen, the right of ownership of the property belonging to him is inherited by other persons in accordance with a will or law.

In case of reorganization of a legal entity, the ownership of the property belonging to it passes to legal entities - legal successors of the reorganized legal entity (Article 46 of this Code).

Alienation of property from the owner to another person against the will of the owner is not permitted, except in cases provided for by this Code.

3. In cases and in the manner provided for by this Code, a person may acquire the right of ownership to property that does not have an owner, to property whose owner is unknown, or to property that the owner has abandoned or to which he has lost the right of ownership on other grounds.

3-1. In cases and in the manner provided for by the laws of the Republic of Kazakhstan, the state acquires the right of ownership of property during requisition, nationalization, forced seizure of a land plot, including for state needs, as well as during the alienation of real estate in connection with the seizure of a land plot.

4. Members of a consumer cooperative (housing, housing-construction, dacha, garage or other), other persons entitled to share savings, who have fully paid their share contribution for an apartment, dacha, garage, or other premises provided to these persons by the cooperative for use, acquire the right of ownership to the specified property.

5. Relations related to the acquisition of ownership or other real rights of an individual, legal entity and (or) person operating in accordance with an agreement on joint activity (simple partnership, consortium) to an apartment and (or) non-residential premises or individual residential building, or their share in the field of shared participation in housing construction in a multi-apartment residential building under construction or a complex of individual residential buildings, are regulated by the Law of the Republic of Kazakhstan “On shared participation in housing construction.”

Footnote. Article 235 as amended by the laws of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated 06/30/2025 No. 204-VIII (shall be introduced into effect upon the expiration of sixty calendar days after the day of its first official publications).

Article 236. Emergence of ownership rights to newly created real estate

1. The right of ownership to newly created real estate arises from the moment of state registration.

2. If legislative acts or an agreement provide for the acceptance of completed construction projects, then the creation of the corresponding property is considered completed from the moment of such acceptance.

3. Excluded by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

4. Until the moment of state registration of the right to newly created real estate, the rules on the right of ownership of materials and other property from which the real estate is created are applied to the property.

Footnote. Article 236 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 237. Processing

1. Unless otherwise provided by the contract, the right of ownership to a new movable thing manufactured by a person by processing materials that do not belong to him is acquired by the owner of the materials.

However, if the cost of processing significantly exceeds the cost of materials, ownership of the new item is acquired by the person who, acting in good faith, carried out the processing for himself.

2. Unless otherwise provided by the contract, the owner of the materials, who has acquired the right of ownership of an item made from them, is obliged to compensate the cost of processing to the person who carried it out, and if this person acquires the right of ownership of a new item, the latter is accordingly obliged to compensate the owner of the materials for their cost.

3. The owner of materials who have lost them as a result of dishonest actions of the person who carried out the processing has the right to demand the transfer of a new thing into his ownership and compensation for losses caused to him.

Article 238. The moment of emergence of the ownership right of the acquirer under the contract

1. The right of ownership of the acquirer of property under an agreement arises from the moment of transfer of the thing, unless otherwise provided by legislative acts or the agreement.

1-1. If the acquirer's ownership under the contract is subject to state registration, then the acquirer's ownership right arises from the moment of such registration, unless otherwise provided by legislative acts.

2. If an agreement on the alienation of property is subject to state registration or notarization, the acquirer’s ownership rights arise from the moment of registration or notarization, and, if necessary, both notarization and state registration of the agreement - from the moment of its registration.

Footnote. Article 238 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).      

Article 239. Transfer of things

1. Transfer is recognized as the delivery of things to the acquirer, as well as the delivery to a transport organization for sending to the acquirer and delivery to the post office for forwarding to the acquirer of things alienated without the obligation of delivery, unless otherwise provided by law or an agreement.

2. If at the time of concluding an agreement on the alienation of a thing it is already in the possession of the acquirer, the thing is recognized as transferred to him from that moment. The transfer of things is equivalent to the transfer of a bill of lading or other administrative document for things.

Article 240. Acquisitive prescription

1. A citizen or legal entity who is not the owner of property, but who in good faith, openly and continuously owns either his own real estate for seven years, or other property for at least five years, acquires the right of ownership of this property (acquisitive prescription).

The right of ownership to real estate and other property subject to state registration arises in the person who acquired this property by virtue of acquisitive prescription from the moment of such registration.

2. Before acquiring property rights, a citizen or legal entity who owns it as their own has the right to protect their possession against third parties who are not the owners of the property, and also do not have the rights to own it due to other grounds provided for by legislative acts or agreement.

3. A citizen or legal entity who refers to the prescription of possession may add to their possession the entire time during which the person whose legal successors they are was in possession of the thing.

4. The period of acquisitive limitation begins from the moment of taking possession of the thing.

5. Excluded by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication).

Footnote. Article 240 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 07/22/2011 No. 479-IV (shall be enforced ten calendar days after its first official publication).      

Article 241. Taking ownership of things publicly available for collection or extraction

In the event that, in accordance with the law, local custom or general permission given by the owner, picking berries, fishing, hunting animals, collecting or extracting other items is allowed in forests, reservoirs or other territory, the right of ownership to the relevant things is acquired by the person who collected or extracted them.

Article 242. Ownerless things

1. An ownerless thing is a thing that does not have an owner or the owner of which is unknown, or a thing for which the owner has renounced the right of ownership.

2. If this is not excluded by the rules on the acquisition of ownership of things that the owner has refused (Article 243 of this Code), on the find (Article 245 of this Code), on stray animals (Article 246 of this Code) and treasure (Article 247 of this Code), the right of ownership to ownerless movable things can be acquired by virtue of acquisitive prescription (Article 240 of this Code).

3. Ownerless real estate is accepted for registration by the body carrying out state registration of rights to real estate, upon application from local executive bodies of cities of republican significance, the capital, districts, cities of regional significance, on the territory of which they are identified. After a year has passed from the date of registration of an ownerless immovable property, the local executive body applies to the court with a request to recognize this property as municipal property. Moreover, in cases where an ownerless thing is an object of life support for the population, the laws of the Republic of Kazakhstan may provide for its temporary operation until the court recognizes this thing as having become communal property.

If the owner renounces ownership by announcing this, the local executive body applies to the court with a demand to recognize this thing as municipal property from the moment the refusal is announced.

The organization of work on accounting, storage, evaluation, further use and sale of property received as municipal property is carried out by the local executive body.

Ownerless real estate owned by citizens or non-state legal entities that own such property as their own cannot be registered and transferred to communal ownership.

The procedure for accounting, storage, evaluation, further use and sale of property that has come into state ownership is determined by the Government of the Republic of Kazakhstan.

At any time before the emergence of another person’s right of ownership of such property, the owner has the right to apply to deregister the immovable property belonging to him as ownerless and to retake it into his actual possession.

Footnote. Article 242 as amended by the laws of the Republic of Kazakhstan dated December 24, 2001 N 276 (shall be enforced on January 1, 2002); dated December 20, 2004 N 13 (effective from January 1, 2005); dated June 22, 2006 N 147; dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated 07/22/2011 No. 479-IV (shall be enforced after ten calendar days after its first official publication); dated 04/09/2025 No. 179-VIII (entered into effect after sixty calendar days after the day of its first official publications).

Article 243. Movable things abandoned by the owner

1. Movable things abandoned by the owner or otherwise abandoned by him for the purpose of renouncing the right of ownership of them (abandoned things) may be turned into their property by other persons in the manner provided for in paragraph 2 of this article.

2. A person who owns, possesses or uses a plot of land where there is an abandoned item, the cost of which is clearly below the amount corresponding to twenty monthly calculation indices, or abandoned scrap metals, defective products, has the right to convert these things into his property by starting to use them or by performing other actions indicating the conversion of the item into ownership.

Other abandoned things become the property of the person who took possession of them if, at the request of this person, they are recognized by the court as ownerless.

Footnote. Article 243 in the new edition - Law of the Republic of Kazakhstan dated March 2, 1998 N 211.

Article 244. Unauthorized construction

1. An unauthorized construction is a residential building, other building, structure or other real estate created on land that is not formed into land plots, owned by the state, on a land plot that does not belong to the person who carried out the construction, as well as created without obtaining permits required in accordance with the land legislation of the Republic of Kazakhstan, the legislation of the Republic of Kazakhstan on architectural, urban planning and construction activities in the Republic of Kazakhstan and other legislation of the Republic of Kazakhstan.

2. A person who has carried out an unauthorized construction does not acquire ownership rights to it. It does not have the right to dispose of the construction - sell, donate, lease, or make other transactions.

An unauthorized building is subject to demolition by the person who carried it out or at his expense, except for the cases provided for in paragraphs 3 and 4 of this article.

3. The right of ownership of an unauthorized structure may be recognized by the court for a person who has carried out construction on a land plot that does not belong to him, provided that this plot will be provided to this person in the prescribed manner for the placement of the erected structure.

The property right of a developer to an unauthorized construction on a land plot that does not belong to him, with the exception of lands owned by the state, may be recognized by the court if there is consent of the owner of the land plot with the payment of compensation to the latter, provided that the building complies with the requirements of the legislation of the Republic of Kazakhstan on architectural, urban planning and construction activities.

The right of ownership of an unauthorized construction may also be recognized by the court for the person in whose legal use the land plot where the construction was carried out is located. In this case, the person whose ownership of the building has been recognized shall reimburse the person who carried it out for the costs of construction in the amount determined by the court.

The right of ownership of an unauthorized structure cannot be recognized for these persons if the preservation of the structure will entail violations of the rights and interests protected by law of other persons or will create a threat to the life and health of citizens.

4. Taking into account socio-economic feasibility, an unauthorized building erected by a person on land plots (land not formed into land plots) owned by the state and not in land use is transferred to communal ownership with reimbursement of construction costs in the amount determined by the court.

When an unauthorized construction is carried out on a land plot located in the land use of state land users, taking into account the socio-economic feasibility, the unauthorized construction is transferred to municipal ownership with reimbursement of construction costs in the amount determined by the court from budgetary funds.

Footnote. Article 244 as amended by the laws of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated 04/27/2012 No. 15-V (shall be enforced after ten calendar days after its first official publication); changes have been made in the Kazakh language, the text in Russian does not change, in accordance with the Law of the Republic of Kazakhstan dated 01/09/2026 No. 254-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 245. Finding

1. The person who finds a lost thing is obliged to immediately notify the person who lost it, or the owner of the thing, or any other person known to him who has the right to receive it, and return the found thing to him.

If an item is found on premises or in a vehicle, it must be handed over to the person representing the owner of this premises or vehicle. In this case, this owner acquires the rights and bears the responsibilities of the person who found the thing.

2. If the person who has the right to receive the found thing, or his whereabouts are unknown, the finder is obliged to report the find to the internal affairs bodies or local executive bodies of cities of republican significance, the capital, districts, cities of regional significance.

3. The person who finds the thing has the right to keep it or deposit it with the internal affairs bodies, local executive bodies of cities of republican significance, the capital, districts, cities of regional significance or a person indicated by them. A perishable item or an item, the storage costs of which are not commensurate with its value, may be sold by the finder of the item upon receipt of written evidence certifying the amount of proceeds. Money proceeds from the sale of a found item are subject to storage and return to the person authorized to receive the item, or transfer into ownership of other persons in the manner and under the conditions established for the item itself.

The finder of a thing is liable for its loss or damage only in the event of his intent or gross negligence and within the limits of the value of this thing.

4. If, after six months from the date of notification of the find to the internal affairs bodies or local executive bodies of cities of republican significance, the capital, districts, cities of regional significance, the person authorized to receive the lost thing is not identified and does not declare his right to the thing to the person who found it, or to the internal affairs bodies or local executive bodies of cities of republican significance, the capital, districts, cities of regional significance, the finder of the thing acquires the right ownership of it.

If the finder of the thing refuses to acquire ownership of the found thing, it becomes communal property.

5. The person who found and returned the thing to the person authorized to receive it has the right to receive from this person, and in the event of the thing becoming communal property, from the relevant local executive body, compensation for the necessary expenses associated with the storage, delivery, sale of the thing, and the costs of finding the person authorized to receive the thing.

6. The finder of the thing has the right to receive a reward from the person authorized to receive the thing in the amount of thirty percent of the value of the thing. If the found thing is of value only to the person authorized to receive it, then the amount of remuneration is determined according to the assessment made by the parties.

The right to remuneration does not arise if the finder of the thing has not fulfilled his obligation to report the find or has taken other actions to conceal the find.

Footnote. Article 245 as amended by the laws of the Republic of Kazakhstan dated December 20, 2004 N 13 (enters into force from January 1, 2005); dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).      

Article 246. Stray animals

1. The person who detained stray or stray cattle and other domestic or tamed animals is obliged to return them to the owner, and if he or his whereabouts are unknown, no later than three days from the moment of such detention, report the discovered animals to the internal affairs bodies or local executive bodies of cities of republican significance, the capital, districts, cities of regional significance, which take measures to search for the owner.

During the period of searching for the owner of the animals, they can be left by the person who detained the animals for his maintenance and use, or handed over to him for maintenance and use to another person who has the necessary conditions for this. At the request of the person who detained the animals, the search for a person who has the necessary conditions for their maintenance and use, and the transfer of the animals to them, is carried out by local executive bodies of cities of republican significance, the capital, districts, cities of regional significance.

2. The person who detained the animals and the person to whom they were transferred for maintenance and use are responsible for the death and damage of the animals only if there is fault and within the limits of the value of these animals.

3. If within six months from the date of the application for the detention of working and cattle and two months of other domestic animals, their owner is not found and does not declare his right to them, the ownership of these animals passes to the person who kept and used them.

If this person refuses to acquire ownership of the animals kept by him, they become communal property and are used in the manner determined by the relevant local executive bodies of cities of republican significance, the capital, districts, cities of regional significance.

4. In the event of the return of animals to the owner, the person who detained the animals and the person who kept and used them have the right to receive from this owner compensation for their expenses associated with the maintenance of the animals, including the benefits derived from their use.

5. A person who has detained stray or stray livestock and other domestic or tamed animals has the right to demand payment of remuneration from their owner in accordance with paragraph 6 of Article 245 of this Code.

6. If the former owner of the animals appears after they have passed into the ownership of another person, the owner has the right, in the presence of circumstances indicating that these animals remain attached to him or that the new owner has cruelly or otherwise mistreated them, to demand their return to him on the terms determined by agreement with the new owner, and if no agreement is reached, by the court.

Footnote. Article 246 as amended by the laws of the Republic of Kazakhstan dated December 20, 2004 N 13 (enters into force from January 1, 2005); dated 12.01.2007 N 225 (shall be enforced from the date of its official publication); dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).      

Article 247. Treasure

1. A treasure, that is, money or other valuable items buried in the ground or hidden in another way, the owner of which cannot be identified or, by virtue of the legislation of the Republic of Kazakhstan, has lost the right to them, shall become the property in equal shares of the owner of the land plot or the owner of the immovable thing in which the treasure was hidden, and the person who discovered the treasure, unless otherwise established by an agreement between them.

If a treasure is discovered by a person who has carried out excavations or searches for valuables without the consent of the user of the land plot (land user) or the owner of the immovable property where the treasure was hidden, the treasure is subject to transfer to the owner.

2. If a treasure containing things related to cultural values ​​is discovered, they are subject to transfer into the ownership of the Republic of Kazakhstan. In this case, the owner of the land plot or the owner of the property in which such a treasure was discovered, and the person who discovered the treasure, have the right to receive a reward in the amount of fifty percent of the value of this treasure. The remuneration is distributed among these persons in relation to the rules provided for in paragraph 1 of this article.

Footnote. Article 247 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).      

Article 248. Acquisition of property seized from the owner

If a person, in the manner and under the conditions established by legislative acts, acquired property seized from the owner on legal grounds, this person acquires ownership of the property.

Chapter 14. Termination of ownership and

other real rights

Article 249. Grounds for termination of ownership rights

1. The right of ownership shall terminate when the owner alienates his property to other persons, the owner renounces the right of ownership, the destruction or destruction of property and the loss of ownership of property in other cases provided for by legislative acts.

2. Forced alienation from the owner of property is not permitted, except in the following cases:

1. foreclosure on property for the obligations of the owner;

2. forced alienation of property that, by virtue of the legislative acts of the Republic of Kazakhstan, cannot belong to this person;

3. requisitions;

4. confiscation;

5. forced alienation of real estate in connection with the seizure of a land plot;

6. seizure of mismanaged historical and cultural monuments and cultural values;

7. nationalization;

8. sale of property at public auction by court decision if it is impossible to divide common property or allocate a share from it in accordance with Article 218 of this Code.

9. turning over property to the state in accordance with the legislation of the Republic of Kazakhstan on the return of illegally acquired assets to the state.

3. State-owned property is alienated into private ownership:

1. citizens and legal entities in cases, on conditions and in the manner provided for by the legislative act of the Republic of Kazakhstan on state property;

2. by transferring objects of state property in payment (formation or increase) of the authorized capital of legal entities;

3. in other cases directly provided for by the laws of the Republic of Kazakhstan.

3-1. The object of alienation cannot be property that, in accordance with the laws of the Republic of Kazakhstan, can only be in state ownership, as well as property that is in state ownership and is not subject to alienation in accordance with acts of the President of the Republic of Kazakhstan or the Government of the Republic of Kazakhstan in agreement with the President of the Republic of Kazakhstan.

4. In the event of the adoption of the Law of the Republic of Kazakhstan on the conversion into state ownership of property that is privately owned by citizens and legal entities (nationalization), they are compensated for losses in the manner established by Article 266 of this Code.

Footnote. Article 249 as amended by the laws of the Republic of Kazakhstan dated December 11, 2008 N 102-IV (for the order of enforcement, see Article 2); dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated 02.27.2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 07/12/2023 No. 23-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication); dated 12/23/2023 No. 51-VIII (shall be enforced ten calendar days after the day of its first official publication).

Article 250. Renunciation of ownership rights

A citizen or legal entity may renounce the right of ownership of property owned by him by declaring this orally or in writing or by performing other actions (inaction) that definitely indicate his removal from ownership, use and disposal of property without the intention of retaining any rights to this property.

The renunciation of the right of ownership must be legal, voluntary and indicating that the owner renounces possession, use, and disposal of the property.

Relinquishment of ownership rights is an expression of the will of the owner. The state and its bodies do not have the right to renounce ownership rights, except in cases established by law.

Relinquishment of the right of ownership does not entail the termination of the rights and obligations of the owner in relation to the relevant property until the acquisition of ownership of this property by another person.

Footnote. Article 250 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 251. Levy of execution on the property of the owner

1. Foreclosure of property for the obligations of the owner is carried out in court, unless otherwise provided by legislative acts of the Republic of Kazakhstan or by agreement.

2. The right of ownership to the property that is being foreclosed is terminated from the owner from the moment the right of ownership to the seized property arises from the person to whom the right of ownership is transferred in the manner prescribed by law.

Footnote. Article 251 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 252. Termination of the ownership right of a person to whom, by virtue of legislative acts, property cannot belong

1. If, on the grounds permitted by legislative acts, a person owns property that cannot belong to him by virtue of legislative acts, this property must be alienated by the owner within one year from the moment the right of ownership to this property arises, unless other periods are provided for by legislative acts. If the property is not alienated by the owner within the specified period, it is subject to compulsory alienation by a court decision with compensation to the owner for the value of the property minus the costs of its alienation.

2. If in the ownership of a citizen or legal entity, on the grounds permitted by legislative acts, there appears to be an item for the acquisition of which a special permit is required, and its issuance to the owner is denied, this item is subject to alienation in the manner established for property that cannot belong to this owner.

Article 253. Requisition

1. In the event of natural disasters, accidents, epidemics, epizootics, during martial law or in wartime and other circumstances of an emergency nature, property in the interests of society by decision of state bodies may be seized from the owner in the manner and under the conditions established by the laws of the Republic of Kazakhstan, with payment to him of the value of the property (requisition).

2. The assessment according to which the owner was compensated for the value of the requisitioned property may be challenged by him in court.

3. A person whose property has been requisitioned has the right, upon termination of the circumstances in connection with which the requisition was made, to demand in court the return of the remaining property to him.

Footnote. Article 253 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).      

Article 254. Confiscation

In cases provided for by the legislative acts of the Republic of Kazakhstan, property may be confiscated from the owner free of charge in court in the form of a sanction for committing an administrative or criminal offense (confiscation).

Footnote. Article 254 as amended by the Law of the Republic of Kazakhstan dated 07/03/2014 No. 227-V (enters into force from 01/01/2015).      

Article 255. Termination of ownership of real estate in connection with the seizure of a land plot and other natural resources

Footnote. The title of Article 255 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

1. Termination of ownership of real estate in connection with a decision of a state body not directly aimed at confiscating property from the owner, including a decision on confiscating a land plot on which a house, other buildings, structures or plantings belonging to the owner are located, is allowed only in cases and in the manner established by legislative acts, with the presentation of equivalent property to the owner and compensation for other losses incurred or compensation in full for losses caused by the termination of ownership.

2. If the owner disagrees with a decision entailing termination of ownership rights, it cannot be implemented until the dispute is resolved in court. When considering a dispute, all issues of compensation to the owner for losses caused are also resolved.

3. The rules of this article are applied accordingly when the right of ownership to real estate is terminated in connection with a decision of a state body to confiscate mining allotments, water areas and other areas on which the property is located.

Footnote. Article 255 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).      

Article 256. Confiscation of mismanaged historical and cultural monuments and cultural values

Footnote. The title of Article 256 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

In cases where the owner of historical and cultural monuments, cultural values ​​classified in accordance with the legislation of the Republic of Kazakhstan as especially valuable and protected by the state, mismanages these monuments and values, which threatens them with the loss of their significance, such monuments and values, by a court decision, are confiscated from the owner by the state through redemption or sold at public auction.

When purchasing historical and cultural monuments, cultural values, the owner is reimbursed for their value in the amount established by agreement of the parties, and in case of a dispute, by the court. When selling at public auction, the proceeds from the sale are transferred to the owner minus the costs of conducting the auction.

Footnote. Article 256 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).      

Article 257. Valuation of property upon termination of ownership rights

Upon termination of ownership rights, property is assessed based on its market price, unless otherwise established by the laws of the Republic of Kazakhstan.

Footnote. Article 257 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).      

Article 258. Termination of real rights belonging to the non-owner

Property rights belonging to the non-owner are terminated according to the rules established by Articles 249-257 of this Code, as well as by decision of the owner in the manner established by legislative acts, the charter of a legal entity or an agreement between the owner and the owner of the property.

Chapter 15. Protection of property rights

and other real rights

Article 259. Recognition of property rights

The owner has the right to demand recognition of ownership.

Article 260. Reclamation of property by the owner from someone else’s illegal possession

The owner has the right to reclaim his property from someone else's illegal possession.

Article 261. Reclamation of property from a bona fide purchaser

1. If property was acquired for compensation from a person who did not have the right to alienate it, which the acquirer did not know and should not have known about (a bona fide acquirer), then the owner has the right to claim this property from the acquirer only in the case where the property is lost by the owner or the person to whom the property was transferred into possession by the owner, or stolen from one or the other, or left their possession in some other way against their will.

2. If property was acquired free of charge from a person who did not have the right to alienate it, the owner has the right to reclaim the property in all cases.

3. Claiming property on the grounds specified in paragraph 1 of this article is not allowed if the property was sold in the manner established for the execution of court decisions.

4. The Law of the Republic of Kazakhstan “On the return of illegally acquired assets to the state” may establish other grounds for recognizing a person as a bona fide acquirer.

Footnote. Article 261 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 07/12/2023 No. 23-VIII (shall be enforced ten calendar days after the day of its first official publication).

Article 262. Limitation of claims for money and securities

Footnote. Article 262 was excluded by the Law of the Republic of Kazakhstan dated September 19, 2025 No. 219-VIII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 263. Calculations when returning things from illegal possession

1. When claiming property on the basis of Articles 260, 261 of this Code, the owner also has the right to demand from the dishonest owner the return or compensation of all income that he received or should have received during the entire period of ownership; from the bona fide owner - all income that he received or should have received from the time when he learned or should have learned about the illegality of possession or received a summons on the owner's claim for the return of property. A bona fide owner, in turn, has the right to demand from the owner compensation for the necessary expenses incurred on the property from the time from which the owner is due income from the property. An unscrupulous owner has the right to receive such compensation in whole or in part only in cases where the owner’s claim is recognized by the court as valid.

2. An illegal owner has the right to retain the improvements he has made if they can be separated without damaging the thing. If such separation of improvements is impossible, the bona fide owner has the right to demand compensation for the costs incurred for the improvement, but not in excess of the increase in the value of the thing. An unscrupulous owner does not have such a right.

Article 264. Protection of the owner’s rights from violations not associated with deprivation of possession

The owner has the right to demand the elimination of any violations of his rights, even if these violations were not associated with deprivation of possession.

Article 265. Protection of property rights of a person who is not the owner

The rights provided for in Articles 259-264 of this Code also belong to a person who, although not the owner, owns the property on the right of economic management, operational management, permanent land use, or on another basis provided for by legislative acts or agreement. This person has the right to defend his possession also against the owner.

Article 266. Protection of the interests of the owner in the event of termination of his rights on the grounds provided for by law

If the Republic of Kazakhstan adopts legislative acts terminating the right of ownership, losses caused to the owner as a result of the adoption of these acts are compensated to the owner in full by the Republic of Kazakhstan.

Article 267. Invalidity of acts of state bodies and officials violating the rights of the owner and other property rights

Footnote. The title of Article 267 as amended by the Law of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication).

1. If, as a result of the issuance of a normative or individual act of a state body or official that does not comply with the law, the rights of the owner and other persons to own, use and dispose of property belonging to them are violated, such an act is declared invalid by the court at the claim of the owner or the person whose rights were violated.

2. When a court makes a decision on a specific case, acts of state bodies that contradict legislative acts are not applied.

Losses caused to the owner as a result of the publication of these acts are subject to compensation in full by the relevant state body from the funds of the relevant budget in accordance with the rules of paragraph 1 Article 922 of this Code.

Footnote. Article 267 as amended by the laws of the Republic of Kazakhstan dated 01.03.2011 No. 414-IV (shall be enforced from the date of its first official publication); dated July 17, 2015 No. 333-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

SECTION 3. LAW OF OBLIGATIONS

Subsection 1. General provisions on the obligation

Chapter 16. Concept and foundations

occurrence of an obligation

Article 268. Obligation

By virtue of an obligation, one person (debtor) is obliged to perform a certain action in favor of another person (creditor), such as: transfer property, perform work, pay money, and so on, or refrain from a certain action, and the creditor has the right to demand that the debtor fulfill his obligation. The creditor is obliged to accept performance from the debtor.

The provisions of this subsection apply to obligations, unless otherwise provided by the Special Part of this Code.

Footnote. Article 268 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 269. Parties to the obligation

1. (Deleted)

2. Several persons may simultaneously participate in an obligation as each of its parties - creditor or debtor. In these cases, an equity, joint or subsidiary obligation arises in accordance with the rules established by this Code (Article 286-288 of this Code).

The invalidity of the creditor's claims against one of the persons participating in the obligation on the debtor's side, as well as the expiration of the statute of limitations on the claim against such person, do not in themselves affect the creditor's claims against the remaining such persons.

3. If, by virtue of an obligation, each of the parties bears an obligation in favor of the other party, it is considered the debtor of the other party in what it is obliged to do in its favor, and at the same time its creditor in what it has the right to demand from it.

Footnote. Article 269 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 270. Participants in an obligation

1. The parties to the obligation are the parties (debtor and creditor) and third parties.

2. Third parties are persons bound by obligations or other legal relations with one of the parties to the obligation.

3. The obligation does not create obligations for third parties. In cases provided for by legislation or agreement of the parties, an obligation may give rise to rights for third parties in relation to one or both parties to the obligation.

Article 271. Grounds for the occurrence of an obligation

Obligations arise from contract, harm or other grounds specified in Article 7 of this Code.

Chapter 17. Fulfillment of an obligation

Article 272. Proper fulfillment of an obligation

The obligation must be fulfilled properly in accordance with the terms of the obligation and the requirements of the law, and in the absence of such conditions and requirements - in accordance with business customs or other usually imposed requirements.

Article 273. Inadmissibility of unilateral refusal to fulfill an obligation

Unilateral refusal to fulfill an obligation and unilateral change of its terms are not allowed, except for cases provided for by law or contract.

Article 274. Fulfillment of an obligation in parts

The creditor has the right not to accept the fulfillment of the obligation in parts, unless otherwise provided by the terms of the obligation, legislation or follows from business customs or the essence of the obligation.

Article 275. Fulfillment of an obligation to the proper person

Unless otherwise provided by agreement of the parties and does not follow from the customs of business or the essence of the obligation, the debtor has the right, when fulfilling the obligation, to demand evidence that the fulfillment is accepted by the creditor himself or a person authorized by him to do so, and bears the risk of the consequences of failure to present such a requirement.

Article 276. Fulfillment of an obligation by a third party

1. The fulfillment of an obligation may be entrusted in whole or in part to a third party, if this is provided for by law or an agreement, as well as if the third party is bound to one of the parties by a relevant agreement.

2. If it does not follow from the legislation, the terms of the obligation or its essence that the debtor is obliged to fulfill the obligation personally, the creditor is obliged to accept the performance offered for the debtor by a third party.

3. A third party who is in danger of losing his right to the debtor’s property (the right to use, possession, pledge, etc.) as a result of the creditor’s foreclosure on this property may, at his own expense, satisfy the creditor’s claim without the debtor’s consent. In this case, the rights of the creditor under the obligation are transferred to the third party and the rules of this Code on assignment of claims are applied (Article 339-347 of this Code).

Article 277. Time limit for fulfilling an obligation

1. If an obligation stipulates or makes it possible to determine the day of its execution or the period of time during which it must be performed, the obligation is subject to execution on this day or, accordingly, at any time within such period.

2. In cases where an obligation does not provide for a deadline for its fulfillment and does not contain conditions allowing to determine this period, it must be fulfilled within a reasonable time after the obligation arises.

An obligation not fulfilled within a reasonable period of time, as well as an obligation for which the deadline for fulfillment is determined by the moment of demand, the debtor is obliged to fulfill within seven days from the date the creditor presents a demand for its fulfillment, unless the obligation to perform within a different period arises from legislation, the terms of the obligation, business customs or the essence of the obligation.

Article 278. Requirements for uniform fulfillment of an obligation

Obligations calculated for long periods of fulfillment must be fulfilled evenly, within periods that are reasonable for this type of obligation (day, decade, month, quarter, etc.), unless otherwise provided by law or the terms of the obligation or does not follow from the essence of the obligation or business customs.

Article 279. Early fulfillment of an obligation

1. The debtor has the right to fulfill the obligation before the deadline, unless otherwise provided by law or the terms of the obligation and does not follow from its essence.

2. Early fulfillment of obligations related to entrepreneurial activity is allowed only in cases where the possibility of fulfilling an obligation before the deadline is provided for by law or the terms of the obligation or follows from the customs of business or the essence of the obligation.

Article 280. Information on the progress of fulfillment of an obligation

Legislation or the terms of the obligation may provide for the obligation of the debtor to inform the creditor about the progress of fulfillment of the obligation.

Article 281. Place of fulfillment of an obligation

If the place of performance is not determined by law or the terms of the obligation or is not clear from the essence of the obligation or business customs, performance must be made:

1. for an obligation to transfer real estate - at the location of the property;

2. under the obligation to transfer goods or other property using transportation - at the place of delivery of the property to the first carrier for delivery to the creditor;

3. for other obligations of the entrepreneur, to transfer goods or other property - at the place of production or storage of the property, if this place was known to the creditor at the time the obligation arose;

4. for a monetary obligation - at the place of residence of the creditor at the time the obligation arose, and if the creditor is a legal entity - at its location at the time the obligation arose; if the creditor at the time of fulfillment of the obligation changed his place of residence or location and notified the debtor about this - at the new place of residence or location of the creditor, with all expenses associated with the change of place of performance being charged to his account;

5. for all other obligations - at the place of residence of the debtor, and if the debtor is a legal entity - at its location.

Footnote. Article 281 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 282. Monetary obligation

1. By virtue of a monetary obligation, one person (debtor) is obliged to pay money to another person (creditor), and the creditor has the right to demand from the debtor the fulfillment of his obligation to pay money (loaning money and other obligations). The rules on monetary obligations apply to obligations to pay money under a compensation agreement, obligations to compensate for losses and pay penalties, as well as obligations arising from causing harm or unjust enrichment, unless otherwise established by this Code, legislative acts of the Republic of Kazakhstan or follows from the essence of the obligation.

Monetary obligations on the territory of the Republic of Kazakhstan must be expressed in tenge (Article 127 of this Code), except for cases provided for by the legislative acts of the Republic of Kazakhstan.

The use of foreign currency, as well as payment documents in foreign currency when making settlements on obligations on the territory of the Republic of Kazakhstan is permitted in cases and on conditions determined by the legislative acts of the Republic of Kazakhstan or in the manner established by them.

The procedure and methods for making payments and transfers are established by the legislation of the Republic of Kazakhstan on payments and payment systems and are determined by the parties in the relevant agreement.

2. The amount of the payment made, which is insufficient to fulfill the monetary obligation, in the absence of another agreement of the parties, first of all pays off the debt on the principal debt and remuneration (interest), the principal debt and remuneration (interest) for the current period, and in the remaining part - the penalty and the costs of the creditor for obtaining performance.

Features of repayment of payments under bank loan agreements or microcredit agreements are established by the banking legislation of the Republic of Kazakhstan or the legislation of the Republic of Kazakhstan on microfinance activities.

3. Long-term obligations may provide for indexation of payment on the terms agreed upon by the parties, unless otherwise provided by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 282 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 N 154; dated July 16, 1999 N 436; dated December 24, 2001 N 276 (effective from January 1, 2002); Law of the Republic of Kazakhstan dated July 10, 2003 N 483 (enters into force on January 1, 2004); dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); dated 02/10/2011 No. 406-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated November 24, 2015 No. 422-V (the order of enforcement see Article 2); dated July 26, 2016 No. 12-VI (shall be enforced thirty calendar days after the day of its first official publication); dated 07/03/2019 No. 262-VI (takes effect from 01/01/2020).

Article 283. Increase in amounts paid for the maintenance of a citizen

The amount paid under a monetary obligation directly for the maintenance of a citizen (compensation for harm caused to life or health, under a lifelong maintenance agreement, etc.) increases annually in proportion to the average value of the projected inflation rate.

Footnote. Article 283 as amended by the Law of the Republic of Kazakhstan dated April 27, 2015 No. 311-V (shall be brought into force ten calendar days after the day of its first official publication).      

Article 284. Fulfillment of mutual obligations

1. Mutual obligations must be fulfilled by the parties simultaneously, unless otherwise follows from the legislation of the Republic of Kazakhstan, the contract, business customs, the terms of the obligation or its essence.

2. In case of non-fulfillment or improper fulfillment of an obligation by one of the parties, the second party has the right to suspend the fulfillment of its obligation or refuse to fulfill this obligation and demand compensation for losses.

Footnote. Article 284 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 285. Fulfillment of an alternative obligation

A debtor obliged to perform one of two or more actions has the right to choose, unless otherwise follows from the legislation or the terms of the obligation.

Article 286. Fulfillment of an obligation in which several creditors or several debtors participate

If several creditors or several debtors are involved in an obligation (an obligation with multiple persons), then each of the creditors has the right to demand performance, and each of the debtors is obliged to fulfill the obligation in equal shares with the others, unless otherwise follows from the legislation or the terms of the obligation (shared obligation).

Article 287. Fulfillment of a joint and several obligation

1. An obligation with multiple persons, by virtue of which each creditor has the right to demand, and each debtor is obliged to fulfill the obligation in full, is recognized as a joint and several obligation.

A joint obligation or joint claim arises if it is provided for by the contract or established by legislative acts (https://adilet.zan.kz/rus/docs/K940001000_#z149), in particular, if the subject of the obligation is indivisible.

2. The obligations of several debtors under an obligation related to entrepreneurial activity, as well as the claims of several creditors in such an obligation, are joint and several, unless otherwise provided by law or the terms of the obligation.

3. In case of joint and several obligations of debtors, the creditor has the right to demand performance both from all debtors and from any of them separately, both in full and in part of the debt. A creditor who has not received full satisfaction from one of the joint and several debtors has the right to demand what was not received from the remaining joint and several debtors.

Joint and several debtors remain obligated until the obligation is fully fulfilled.

Fulfillment of a joint and several obligation in full by one of the debtors releases the remaining debtors from fulfillment to the creditor.

4. If there is solidarity of claims, any of the joint creditors has the right to file a claim against the debtor in full.

Fulfillment of an obligation in full by one of the solidary creditors releases the debtor from fulfillment to the remaining creditors.

5. In the case of a joint and several obligation, the debtor does not have the right to raise objections against the creditor’s claim based on relations of other debtors to the creditor in which this debtor does not participate.

In the case of solidarity of claims, the debtor does not have the right to raise objections against the claim of one of the joint creditors based on the relationship of the debtor with another joint creditor in which this creditor does not participate.

Footnote. Article 287 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 288. Fulfillment of a subsidiary obligation

Legislative acts or the terms of the obligation between the creditor and the debtors may provide that if the main debtor does not satisfy the creditor's demand for fulfillment of the obligation, this demand may be stated in the unfulfilled part to another debtor (subsidiary debtor).

Article 289. Recourse claims

1. A debtor who has fulfilled the obligation of another person has the right of recourse (recourse) to this person in the amount of the fulfilled obligation.

A debtor who fails to fulfill an obligation due to the actions of a third party has the right to demand compensation for losses from this person.

2. A debtor who has fulfilled a joint and several obligation has the right to claim back against each of the other debtors in an equal share, minus the share falling on himself.

What is not paid by one of the co-debtors to the debtor who has fulfilled a joint and several obligation falls in equal shares on this debtor and on the other co-debtors.

The rules of this paragraph apply accordingly when a joint and several obligation is terminated by offsetting the counterclaim of one of the debtors.

3. A joint and several creditor who has received performance from a debtor is obliged to compensate other creditors for their shares, unless otherwise follows from the relations between them.

Article 290. Certification of fulfillment of an obligation

1. The creditor, accepting the performance, is obliged, at the request of the debtor, to issue him a receipt for receipt of the performance in whole or in part.

If the debtor has issued a debt document to the creditor as evidence of the obligation, then the creditor, upon accepting performance, must return the document to the debtor. If it is impossible to return, he must indicate this in the receipt he issues.

The receipt may be replaced by an inscription on the debt document returned to the debtor.

2. The presence of a debt document with the debtor certifies, until otherwise proven, the termination of the obligation.

3. If the creditor refuses to issue a receipt for execution, return the debt document, or note the impossibility of its return in the receipt, the debtor has the right to delay execution. In this case, the creditor is considered to be in default.

Article 291. Fulfillment of an obligation by payment of a debt

Footnote. Title of Article 291 as amended by the Law of the Republic of Kazakhstan dated 07/02/2018 No. 166-VI (enters into force from 07/01/2019).

1. In fulfillment of obligations, the debtor has the right to place the money due from him on deposit terms, and securities - on storage terms in the name of a notary, and in cases established by legislative acts - in the name of the court, if the obligation cannot be fulfilled by the debtor due to:

1. the absence of the creditor or the person authorized by him to accept performance in the place where the obligation must be fulfilled;

2. the incapacity of the creditor and the absence of his representative;

3. an obvious lack of certainty as to who is the creditor of the obligation, in particular in connection with a dispute on this issue between the creditor and other persons;

4. the creditor’s evasion from accepting performance or other delay on his part.

In fulfillment of obligations, the debtor also has the right to place the money due from him on the terms of a deposit in the name of a notary if a notarized agreement between the debtor and the creditor provides for the placement of money on a notary's deposit as a way to fulfill the obligation.

2. The deposit of money or securities under the terms of deposit or storage in the name of a notary or court is considered the fulfillment of an obligation.

The notary or the court in whose name the money or securities are deposited notifies the creditors about this.

The conditions for the debtor to place money and securities in the name of the notary, to issue them to the creditor, as well as other conditions of deposit and storage are established by the legislation of the Republic of Kazakhstan on notaries.

3. Features of the fulfillment of certain obligations on the securities market that cannot be fulfilled due to the grounds specified in paragraph 1 of this article are established by the laws of the Republic of Kazakhstan.

Footnote. Article 291 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated 03/02/1998 No. 211; dated 07/02/2018 No. 166-VI (effective from 07/01/2019); dated January 21, 2019 No. 217-VI (shall be enforced ten calendar days after the day of its first official publication).

Chapter 18. Ensuring the fulfillment of an obligation

Paragraph 1. General provisions

Article 292. Methods of ensuring the fulfillment of an obligation

1. Fulfillment of an obligation may be ensured by a penalty, a pledge, retention of the debtor’s property, a surety, a guarantee, a deposit, a guarantee fee, a security deposit and other methods provided for by the legislation of the Republic of Kazakhstan or an agreement.

Methods for ensuring the fulfillment of obligations under securities are established by the legislative acts of the Republic of Kazakhstan regulating activities in the securities market.

2. The invalidity of an agreement to secure an obligation does not entail the invalidity of this obligation (the main obligation).

3. The invalidity of the main obligation entails the invalidity of the obligation securing it.

4. Termination of the main obligation entails the termination of the obligation securing it, unless otherwise provided by the legislative acts of the Republic of Kazakhstan.

Footnote. Article 292 as amended by the laws of the Republic of Kazakhstan dated 07/08/2005 N 72 (the order of enforcement see Article 2); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 24.11.2015 No. 422-V (entered into effect from 01.01.2016); dated 07/12/2022 No. 138-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Paragraph 2. Penalty

Article 293. Concept of penalty

A penalty (fine, penalty) is a sum of money determined by law or contract, which the debtor is obliged to pay to the creditor in the event of non-fulfillment or improper fulfillment of an obligation, in particular in case of delay in fulfillment. Upon a claim for payment of a penalty, the creditor is not required to prove that he suffered losses.

Footnote. Article 293 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 294. Form of agreement on penalties

An agreement on a penalty must be made in writing, regardless of the form of the main obligation.

Failure to comply with the written form entails the nullity of the agreement on penalties.

Footnote. Article 294 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 295. Legal penalty

1. The creditor has the right to demand payment of a penalty determined by law (legal penalty), regardless of whether the obligation to pay it is provided for by agreement of the parties.

2. The amount of a legal penalty may be increased by agreement of the parties, unless this is prohibited by law.

Article 296. Amount of penalty

The amount of the penalty is determined in a fixed monetary amount or as a percentage of the amount of the unfulfilled or improperly fulfilled obligation.

Article 297. Reduction of the amount of the penalty

If the payable penalty (fine, penalty) is excessively large compared to the creditor's losses, the court, at the request of the debtor, has the right to reduce the penalty (fine, penalty), taking into account the degree of fulfillment of the obligation by the debtor and the interests of the debtor and the creditor that deserve attention.

Footnote. Article 297 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 298. Grounds for collecting a penalty

A penalty is collected for non-fulfillment or improper fulfillment of an obligation if there are conditions for holding the debtor liable for violation of the obligation (Article 359 of this Code).

Paragraph 3. Pledge

Article 299. Concept of pledge

1. A pledge is recognized as such a method of securing the fulfillment of an obligation, by virtue of which the creditor (pledgee) has the right, in the event of failure of the debtor to fulfill the obligation secured by the pledge, to receive satisfaction from the value of the pledged property preferentially before other creditors of the person who owns this property (the pledgor), with the exceptions established by this Code.

The pledgee has the right to receive, on the same basis, satisfaction from the insurance compensation for loss or damage to the pledged property, regardless of whose benefit it is insured, unless the loss or damage occurred for reasons for which the pledgee is responsible.

2. The pledge of enterprises, buildings, structures, apartments, rights to land plots and other real estate (mortgage) is regulated by the Law of the Republic of Kazakhstan on real estate mortgages. The general rules on mortgage contained in this Code apply to mortgages in cases where the Law of the Republic of Kazakhstan on mortgages does not establish other rules.

3. The pledge of aircraft and sea vessels, inland water vessels, river-sea vessels subject to state registration (vessel mortgage) is regulated by special legislative acts of the Republic of Kazakhstan. The general rules on mortgage contained in this Code apply to the mortgage of a ship in cases where special legislative acts of the Republic of Kazakhstan do not establish other rules.

The requirements of part one of this paragraph also apply to sea vessels under construction, inland water navigation vessels, and river-sea navigation vessels.

Footnote. Article 299 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 No. 211; dated January 17, 2002 No. 285.

Article 300. Grounds for the emergence of a pledge

1. A pledge arises by virtue of an agreement. A pledge also arises on the basis of legislative acts upon the occurrence of the circumstances specified therein, if the legislative acts stipulate what property and to ensure the fulfillment of which obligation is recognized as being pledged.

2. The rules of this Code on a pledge arising by virtue of an agreement are correspondingly applied to a pledge arising on the basis of legislative acts, unless otherwise provided by legislative acts.

Article 301. Subject of pledge

1. The subject of the pledge may be any property, including things and property rights (claims), with the exception of things withdrawn from circulation (clause 2 of Article 116 of this Code), claims inextricably linked with the personality of the creditor, in particular claims for alimony, compensation for harm caused to life or health, and other rights, the assignment of which to another person is prohibited by legislative acts.

2. The right of pledge may be extended by agreement to property that will come into the ownership or economic management of the pledgor in the future.

3. The pledge of certain types of property, in particular the property of citizens, on which foreclosure is not allowed, may be prohibited or limited by legislative acts.

4. (excluded - dated January 12, 2007 No. 225) 5. (deleted) Footnote. Article 301 was amended by the Laws of the Republic of Kazakhstan dated July 11, 1997 No. 154; dated March 2, 1998 No. 211; dated July 8, 2005 No. 72 (the order of enforcement see Article 2); dated January 12, 2007 No. 225 (shall be enforced from the date of its official publication).

Article 302. Claims secured by a pledge

1. Unless otherwise provided by the contract or legislative acts, the pledge secures the claim in the amount it has at the time of actual satisfaction, including remuneration (interest), compensation for losses caused by delay in execution, penalties (fine, penalty), necessary costs for maintaining the pledged property, as well as reimbursement of collection costs.

2. A pledge may be established in respect of claims that will arise in the future, provided that the parties agree on the amount of security for such claims.

Footnote. Article 302 was amended by Law of the Republic of Kazakhstan dated July 11, 1997 No. 154.

Article 303. Types of pledge

1. Mortgage is a type of pledge in which the pledged property remains in the possession and use of the mortgagor or a third party.

The subject of a mortgage can be enterprises, structures, buildings, structures, apartments in an apartment building, vehicles, space objects, goods in circulation and other property that has not been withdrawn from civil circulation.

Separable fruits can be the subject of a mortgage only if they do not become the object of the rights of a third party from the moment of separation. Mortgages of enterprises, structures, buildings, structures, apartments in an apartment building, vehicles and space objects are subject to registration with the authorities that register such objects.

2. Pledge is a type of pledge in which the pledged property is transferred by the mortgagor into the possession of the pledgee.

With the consent of the pledgee, the collateral may be left with the pledgor under the pledgee's lock. The subject of the pledge may be left in the possession of the pledgor with signs indicating the pledge (hard pledge).

3. When pledging rights, the subject of the pledge is property rights that can be alienated, in particular, lease rights to enterprises, buildings, buildings, structures, the right to a share in the property of a business partnership, debt claims, copyright, invention and other property rights.

Pledge of rights to a land plot, as well as rights to other natural resources, is permitted within the limits and on the conditions established by land and other natural resource legislation.

A fixed-term right can be the subject of a pledge only until its expiration.

The lien debtor must be notified of the lien.

If the pledged right is confirmed by a document, the pledge agreement can be formalized by transfer of the title document.

3-1. When pledging a bank deposit, the rights of the depositor under the bank deposit agreement are granted as collateral. The pledgor-depositor is obliged to notify the bank in writing about the pledge of the bank deposit, indicating information about the pledgee.

4. The pledge of securities is carried out in accordance with the legislation on the securities market.

5. Unless otherwise established by the pledge agreement, the money that is the subject of the pledge is placed in a bank.

The remuneration (interest) due for this money belongs to the pledgor, unless otherwise provided by the agreement.

Money can be transferred to the pledgee or another person subject to conditions that limit the possibility of using the pledged money by this person (transfer for storage to a bank safe, safe deposit box, separate storage room). Failure by such a person to comply with restrictions on the use of the pledged money is the basis for his liability for unjust enrichment from the moment the money is transferred to him.

Footnote. Article 303 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 N 154; dated 07/08/2005 N 72 (the order of enforcement see Article 2); dated 12.01.2007 N 225 (shall be enforced from the date of its official publication); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 05/24/2018 No. 156-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 304. Pledge of property in common ownership

Property constituting common property can be pledged only with the consent of all owners. The right to a share in common property may be an independent subject of pledge.

Article 305. Pledgor

1. The pledgor can be either the debtor himself or a third party.

2. The pledgor of a thing may be its owner or, with the consent of the owner, a person who has the right of economic management over it, unless otherwise provided by legislative acts.

3. The pledger of the right may be the person who owns the pledged right.

Pledge of a lease right or other right to someone else's thing is not allowed without the consent of its owner or the person who has the right of economic management over it, if legislative acts or an agreement prohibit the alienation of this right without the consent of these persons.

Article 305-1. Co-mortgagors

1. In cases provided for by the laws of the Republic of Kazakhstan or agreements, the collateral securing the fulfillment of an obligation under one loan agreement may be pledged by several pledge holders (co-pledge holders) to ensure the fulfillment of the obligations of one debtor to them.

Unless otherwise established by the laws of the Republic of Kazakhstan or agreements, each of the co-pledgeholders independently exercises the rights and obligations of the pledgee within the limits of the amount of his claims secured by the pledge.

2. The money proceeds from the sale of the pledged item are distributed among the co-pledgeholders, who are creditors of the main obligation, in proportion to the size of their claims secured by the pledge, unless otherwise provided by the agreement between them.

When foreclosure is made on the subject of the pledge, in the event of its non-sale, the subject of the pledge comes into the shared ownership of the co-pledgers in proportion to the size of their claims secured by the pledge, unless otherwise established by an agreement between them.

The provisions of this article do not apply to subsequent pledges (repledges).

Footnote. Paragraph 3 is supplemented by Article 305-1 in accordance with the Law of the Republic of Kazakhstan dated 01/02/2021 No. 399-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 306. Insurance of pledged property

1. An agreement or legislative acts may impose on the pledgee the obligation to insure the pledged property transferred into his possession.

Insurance of the pledged property, which remains in the use of the pledgor, is entrusted to the latter.

2. When an insured event occurs, the pledgor’s right to claim under the pledged property insurance agreement arises only if the pledgee renounces it.

If the amount of the insurance payment exceeds the amount of the obligation secured by the pledge, the pledgee is obliged to transfer the difference to the pledgor within three banking days from the date of receipt.

Footnote. Article 306 was amended by Law of the Republic of Kazakhstan dated December 18, 2000 No. 128.

Article 307. Content and form of the pledge agreement

1. The pledge agreement must indicate the subject of the pledge, the essence, size or maximum amount and deadline for fulfilling the obligation secured by the pledge. If the collateral is real estate, the collateral agreement must indicate its valuation.

Movable property and (or) certain categories of movable property (including machinery and inventories) that are the subject of pledge may have a general description of the pledged item without requiring a specific description of the collateral and without an assessment of the pledged item.

The pledge agreement must also contain an indication of which party is in possession of the pledged property and the permissibility of its use.

The valuation of the subject of pledge is expressed in tenge and can be determined by agreement of the parties, unless otherwise established by the laws of the Republic of Kazakhstan. The valuation of the collateral securing an obligation in a foreign currency is expressed in tenge and the currency of the obligation at the market exchange rate on the date of concluding the collateral agreement.

2. The pledge agreement must be concluded in writing.

3. Failure to comply with the rules contained in paragraphs 1 and 2 of this article entails the nullity of the pledge agreement.

Footnote. Article 307 as amended by the Law of the Republic of Kazakhstan dated 10.02.2011 No. 406-IV (shall be brought into force after ten calendar days after its first official publication); as amended by the laws of the Republic of Kazakhstan dated December 29, 2014 No. 269-V (takes effect from January 1, 2015); dated 04/22/2015 No. 308-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 02/27/2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 05/24/2018 No. 156-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 308. Registration of pledge

1. The pledge of property subject to registration must be registered with the body that registers this property, unless otherwise follows from this Code.

A pledge of real estate is subject to state registration by the body that registers rights to real estate.

2. Changes in the subject of pledge, as well as other changes in cases established by the legislative acts of the Republic of Kazakhstan, are subject to registration.

Changes in collateral that are not subject to mandatory registration may be registered at the request of the participants.

3. An entry on the termination of the pledge is made in the register when:

1. registration of termination of the pledge based on the application of the pledgee in connection with the fulfillment of the main obligation;

2. foreclosure on the subject of pledge in the manner prescribed by the legislative acts of the Republic of Kazakhstan;

3. registration of termination of the pledge in connection with the termination of the pledge agreement;

4. termination of the pledge on other grounds provided for by Article 322 of this Code.

4. The pledgor who has fulfilled the obligation secured by the pledge has the right to demand cancellation of the entry on the pledge in the register. At the request of the pledgor, the pledgee is obliged to submit to the registration authority the necessary documents and written statements. If the pledgee fails to fulfill or untimely fulfills these obligations, the pledgor has the right to demand compensation for losses caused to him.

Footnote. Article 308 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force ten calendar days after the day of its first official publication).

Article 309. Property to which the rights of the mortgagee apply

1. The rights of the pledgee (the right of pledge) to the thing that is the subject of the pledge extend to its accessories and inseparable fruits, unless otherwise provided by the agreement or legislative acts.

In cases provided for by agreement or legislative acts, the right of pledge may extend to separable fruits, products and income obtained as a result of the use of the pledged property, as well as subsequently acquired assets and replaced assets.

If the subject of the pledge is movable property, the right of pledge extends to separable fruits, products and income (including subsequently acquired assets and replaced assets) obtained as a result of its use, unless otherwise provided by the contract.

In this case, the right of pledge extends to separable fruits, products and income (including subsequently acquired assets and replaced assets) only to the extent of the claim that it does not secure with the pledged movable property at the time of its actual satisfaction.

2. When mortgaging an enterprise or other property complex as a whole, the right of pledge extends to all of its property, movable and immovable, including rights of claim and exclusive rights, including those acquired during the mortgage period, unless otherwise provided by legislative acts or agreement.

3. A mortgage of a building or structure is allowed only with a simultaneous mortgage under the same agreement of the right to the land plot on which this building or structure is located, or to a part of this plot that functionally provides the mortgaged object.

Footnote. Article 309 as amended by the laws of the Republic of Kazakhstan dated December 29, 2014 No. 269-V (shall be enforced from January 1, 2015); dated 05/24/2018 No. 156-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 310. Emergence of the right of pledge

1. Unless otherwise provided by the pledge agreement, the right of pledge arises in relation to property, the pledge of which is subject to registration - from the moment of registration of the agreement, in relation to other property - from the moment of transfer of this property to the pledgee, and if it is not subject to transfer, then from the moment of concluding the pledge agreement.

2. The right of pledge on goods in circulation arises in accordance with the rules of paragraph 2 of Article 327 of this Code.

Article 311. Subsequent pledge (repledge)

1. If the property that is pledged becomes the subject of another pledge to secure other claims (repledge), the claims of the subsequent pledgee are satisfied from the value of the pledged item after satisfying the claims of the previous pledgeholders.

2. Re-pledge is allowed if it is not prohibited by previous pledge agreements.

3. The pledgor is obliged to inform each subsequent pledgee of information about all existing pledges of this property and is responsible for losses caused to pledgees by failure to fulfill this obligation.

Footnote. Article 311 was amended by the Laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated January 12, 2007 N 225 (shall be enforced from the date of its official publication).      

Article 312. Maintenance and safety of pledged property

1. The pledgor or pledgee, depending on which of them has the pledged property, is obliged, unless otherwise provided by legislative acts or agreement:

1. take measures necessary to ensure the safety of the pledged property, including to protect it from attacks and claims from third parties;

2. immediately notify the other party of the threat of loss or damage to the pledged property.

2. The pledgee and the mortgagor have the right to check, using documents and in fact, the existence, size, condition and conditions of storage of the pledged property held by the other party.

3. In case of gross violation by the pledgee of the obligations specified in paragraph 1 of this article, creating a threat of loss or damage to the pledged property, the pledgor has the right to demand early termination of the pledge.

Article 313. Consequences of loss or damage to pledged property

1. The pledgor bears the risk of accidental loss or damage to the pledged property, unless otherwise provided by the pledge agreement.

2. The pledgee is responsible for the complete or partial loss or damage of the pledged item transferred to him, unless he proves that he can be released from liability in accordance with Article 359 of this Code.

3. The pledgee is liable for the loss of the pledged item in the amount of its actual value, and for its damage - in the amount by which this value has decreased, regardless of the amount at which the pledged item was valued when it was transferred to the pledgee.

4. If, as a result of damage to the subject of pledge, it has changed so much that it cannot be used for its intended purpose, the pledgor has the right to refuse it and demand compensation for its loss.

5. The agreement may provide for the obligation of the pledgee to compensate the pledgor for other losses caused by loss or damage to the pledged item.

6. The pledgor, who is a debtor under an obligation secured by a pledge, has the right to set off a claim against the pledgee for compensation for losses caused by the loss or damage of the subject of pledge against the obligation secured by the pledge.

Article 314. Replacement and restoration of the subject of pledge

1. Replacement of the subject of pledge is permitted with the consent of the pledgee, unless otherwise provided by legislative acts or agreement.

2. If the pledged item is destroyed or damaged, or the right of ownership or economic management to it is terminated on the grounds established by legislative acts, the pledgor has the right to restore the pledged item within a reasonable time or replace it with other equivalent property.

Article 315. Use and disposal of the subject of pledge

1. The pledgor has the right, unless otherwise provided by the agreement and does not follow from the essence of the pledge, to use the subject of the pledge in accordance with its purpose, including extracting fruits and income from it.

2. Unless otherwise provided by legislative acts or an agreement and does not follow from the essence of the pledge, the pledgor has the right to alienate the subject of the pledge into ownership, economic management or operational management, transfer it for rent or free use to another person, or otherwise dispose of it only with the consent of the pledgee.

An agreement limiting the mortgagor’s right to bequeath the pledged property is void.

3. The pledgee has the right to use the collateral transferred to him only in cases provided for by the agreement, regularly submitting a report on use to the pledgor. Under the agreement, the pledgee may be obligated to extract fruits and income from the pledged property in order to repay the main obligation or in the interests of the pledgor.

Footnote. Article 315 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 316. Protection by the pledgee of his rights to the subject of pledge

1. The pledgee, who had or should have had the pledged property, has the right to reclaim it from someone else’s illegal possession, including from the pledgor himself.

2. In cases where, under the terms of the agreement, the pledgee is granted the right to use the collateral transferred to him, he may demand from other persons, including the pledgor, to eliminate any violations of his right, even if these violations were not associated with deprivation of possession.

Article 317. Grounds for foreclosure on pledged property

1. Foreclosure on the pledged property to satisfy the claims of the pledgee (creditor) may be brought in the event of failure or improper performance by the debtor of the obligation secured by the pledge for which he is responsible.

2. Foreclosure of the pledged property may be refused if the debtor’s violation of the obligation secured by the pledge is insignificant and the size of the pledgee’s claims as a result is clearly disproportionate to the value of the pledged property.

The violation of the obligation secured by the pledge is insignificant and the amount of the pledgee’s claims is clearly disproportionate to the value of the pledged property, subject to the simultaneous presence of the following conditions:

1. the amount of the unfulfilled obligation (excluding penalties (fines, penalties)) is less than ten percent of the value of the pledged property, determined by the parties in the pledge agreement;

2. the period of delay in fulfilling the obligation secured by the pledge is less than three months.

A violation of an obligation secured by a pledge on mortgage loans secured by an individual’s home and not related to business activities is insignificant and the amount of the mortgagee’s claims is clearly disproportionate to the value of the pledged property, subject to the simultaneous presence of the following conditions:

1. the amount of the unfulfilled obligation (excluding penalties (fines, penalties)) is less than fifteen percent of the value of the pledged property, determined by the parties in the pledge agreement;

2. the period of delay in fulfilling the obligation secured by the pledge is less than six months.

Footnote. Article 317 as amended by the laws of the Republic of Kazakhstan dated July 17, 2015 No. 333-V (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication); dated 12/31/2021 No. 100 (shall be enforced ten calendar days after the day of its first official publication).

Article 318. Procedure for foreclosure on the subject of pledge

1. Satisfaction of the pledgee's claim from the value of the pledged property is carried out, unless otherwise established by this Code and other legislative acts or agreement, in court.

2. In cases provided for by the pledge agreement, as well as by this Code and other legislative acts, the pledgee has the right to independently sell the pledged property out of court by holding a tender (auction). The pledgee bank has the same right to sell the collateral securing a cash loan. Extrajudicial sale of mortgaged real estate is not permitted in cases provided for by the legislative act of the Republic of Kazakhstan on the mortgage of real estate.

The specifics of foreclosure on collateral, which is security for a loan as part of measures to ensure the stability of the financial system, are established by the laws of the Republic of Kazakhstan.

Footnote. Article 318 as amended by the laws of the Republic of Kazakhstan dated 10.02.2011 No. 406-IV (shall be brought into force after ten calendar days after its first official publication); dated 07/02/2018 No. 168-VI (for the order of enforcement, see Article 2).

Article 319. Sale of pledged property

1. The realization (sale) of the pledged property is carried out by sale at public auction in the manner established by procedural legislation, unless legislative acts establish a different procedure.

1-1. When pledging money and rights (claims) under a monetary obligation, the sale of this pledged property is carried out by transferring to the pledgee the money that is the subject of the pledge or owed under the pledged rights (claims) under the monetary obligation, and if it is impossible to transfer money at the time of foreclosure on the subject of the pledge, by transferring to the pledgee the rights of the pledgor on the subject of the pledge.

If the amount of money that is the subject of a pledge or owed under pledged rights (claims) under a monetary obligation exceeds the amount of the pledgee's claim secured by the pledge, the difference is returned to the pledgor. If the amount of money is insufficient to cover the claim of the pledgee, he has the right, in the absence of other instructions in legislative acts or the agreement, to receive the missing amount from the other property of the debtor, without taking advantage of the pledge.

2. The specifics of the extrajudicial sale of pledged property are established by this Code and the Law on real estate mortgages. The rules and procedures established by the Law on the mortgage of real estate for the implementation of a mortgage apply to the sale of property in the execution of other types of collateral, unless otherwise established by this Code.

3. At the request of the pledgor, the court has the right, in a decision to foreclose on the pledged property, to postpone the sale at public auction for a period of up to one year of the pledged property of individuals and for a period of up to one month of the pledged property of legal entities. The deferment does not affect the rights and obligations of the parties under the obligation secured by the pledge of this property, and does not relieve the debtor from compensation for the creditor's losses and penalties that have increased during the deferment.

4. Unless otherwise provided by the legislative acts of the Republic of Kazakhstan, any legal entities and citizens, including the pledgor and the pledgee, have the right to participate in the auction.

Before the start of the auction, the court or an authorized representative (Article 320 of this Code) has the right to require each auction participant to make a guarantee deposit. Security deposits are refundable at the end of the auction. The guarantee contribution of the participant who wins the auction is counted towards the final price. The security deposit of a participant who wins the auction but does not pay the final price is not returned and remains at the disposal of the court or a trustee.

5. When the auction is declared invalid due to the participation of less than two buyers, the pledgee has the right to either turn the pledged property into his own property at its current assessed value, established by a court decision or a trustee on the basis of an assessment report drawn up by an appraiser, or to demand the appointment of a new auction.

6. If the amount received from the sale of the pledged property is insufficient to cover the claim of the pledgee, he has the right, in the absence of other instructions in legislative acts or the agreement, to receive the missing amount from the other property of the debtor, without taking advantage of the pledge.

If the amount received from the sale of the pledged property exceeds the amount of the pledgee's claim secured by the pledge, the difference is returned to the pledgor.

7. The debtor and the pledgor, who is a third party (real guarantor), have the right, at any time before the sale of the subject of pledge, to stop foreclosure and its sale by fulfilling the obligation secured by the pledge or that part of it, the fulfillment of which is overdue. An agreement limiting this right is void.

Footnote. Article 319 as amended by the laws of the Republic of Kazakhstan dated November 8, 2000 N 96; dated 12.01.2007 N 225 (shall be enforced from the date of its official publication); dated March 25, 2011 No. 421-IV (shall be enforced upon expiration of ten calendar days after its first official publication); dated 03/07/2014 No. 177-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 02.27.2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated January 10, 2018 No. 134-VI (shall be enforced six months after the date of its first official publication); dated 07/02/2018 No. 168-VI (shall be enforced upon expiration of ten calendar days from the date of its first official publication); dated 12/31/2021 No. 100 (shall be enforced ten calendar days after the day of its first official publication).

Article 320. Sale of pledged property in a forced out-of-court manner

1. When selling pledged property in a forced out-of-court manner, the auction is held by an authorized person, who is a legal entity or citizen who has a power of attorney from the pledgee to sell the pledged property in the event of a violation of the obligation secured by the pledge.

2. The authorized representative performs the following procedures:

1. draws up a notice to the pledgor about non-fulfillment of obligations and registers it with the body where the pledge agreement was registered;

2. if the requirements arising from the notification are not satisfied, but not earlier than thirty days from the moment it is sent to the pledgor, draws up a notice of bidding for the pledged property, registers it with the body where the pledge agreement was registered, and hands it to the pledgor or sends it to the pledgor by registered mail to the address specified in the pledge agreement;

3. officially publishes the auction announcement in the local press.

Footnote. Article 320 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force upon the expiration of ten calendar days after its first official publication).

Article 321. Early fulfillment of an obligation secured by a pledge and foreclosure on the pledged property

1. The pledgee has the right to demand early fulfillment of the obligation secured by the pledge in the following cases:

1. if the subject of the pledge has left the possession of the pledgor, with whom it was left, not in accordance with the terms of the pledge agreement;

2. violation by the pledgor of the rules on replacing the subject of pledge (Article 314 of this Code);

3. loss of the subject of pledge due to circumstances for which the pledgee is not responsible (clause 2 of Article 313 of this Code), if the pledgor did not exercise the right provided for in paragraph 2 of Article 314 of this Code.

4. foreclosure on the subject of pledge in order to fulfill the obligations of the pledgor under executive documents to third parties who do not have an advantage over the claim of the pledgee, if the pledgor does not have other property.

2. The pledgee has the right to demand early fulfillment of the obligation secured by the pledge, and if his demand is not satisfied, to foreclose on the pledged item in the following cases:

1. violation by the pledgor of the rules on subsequent pledge;

2. failure by the mortgagor to fulfill the obligations provided for in subparagraphs 1 and 2 paragraph 1 and paragraph 2 of Article 312 of this Code;

3. violation by the mortgagor of the rules on the disposal of pledged property (clause 2 of Article 315 of this Code);

4. violation by the mortgagor of the obligation secured by the pledge (Article 317, 720 and 722 of this Code, Article 20 of the Law of the Republic of Kazakhstan of December 23, 1995 “On Mortgage of Real Estate”).

Footnote. Article 321 as amended by the laws of the Republic of Kazakhstan dated 04/02/2010 No. 262-IV (enters into force on 10/21/2010); dated July 17, 2015 No. 333-V (shall be enforced upon the expiration of ten calendar days after the day of its first official publication).

Article 322. Termination of pledge

1. The pledge is terminated:

1. upon termination of the obligation secured by the pledge;

2. at the request of the pledgor if there are grounds provided for in paragraph 3 of Article 312 of this Code;

3. in the event of the destruction of the pledged item or termination of the pledged right, if the pledgor did not exercise the right provided for in paragraph 2 of Article 314 of this Code;

4. in the case of sale of the pledged property at public auction, as well as in the case when its sale turned out to be impossible (Article 319 of this Code).

2. A note about the termination of the pledge must be made in the register in which the pledge agreement was registered.

3. When the pledge is terminated due to the fulfillment of the obligation secured by the pledge or at the request of the pledgor (clause 3 of Article 312 of this Code), the pledgee who had the pledged property is obliged to immediately return it to the pledgor.

Article 323. Preservation of the pledge when the right to the pledged property is transferred to another person in the order of legal succession

1. In the event of a transfer of ownership of the pledged property or the right of economic management of it from the pledgor to another person as a result of paid or gratuitous alienation of this property or in the manner of universal legal succession, the right of pledge remains in force.

The legal successor of the pledgor takes the place of the pledgor and bears all the obligations of the pledgor, unless otherwise established by agreement with the pledgee.

2. If the property of the pledgor, which is the subject of a pledge, has been transferred by succession to several persons, each of the legal successors (purchasers of property) shall bear the consequences arising from the pledge of failure to fulfill the obligation secured by the pledge in proportion to the part of the specified property transferred to it. However, if the subject of the pledge is indivisible or for other reasons remains in the common joint ownership of the legal successors, they become joint and several pledgors.

Article 324. Consequences of forced seizure of pledged property

1. If the mortgagor’s ownership of the property that is the subject of the pledge is terminated on the grounds and in the manner established by legislative acts, as a result of seizure (redemption) for state needs, requisition or nationalization, and the mortgagor is provided with other property or appropriate compensation, the right of pledge extends to the property provided in return or, accordingly, the pledgee acquires the right of priority satisfaction of his claim from the amount of compensation due to the mortgagor. The pledgee may also demand early execution of the obligation secured by the pledge (clause 1 of Article 321 of this Code).

2. In cases where the property that is the subject of a pledge is confiscated from the pledgor in the manner established by legislative acts on the basis that in reality the owner of this property is another person, or in the form of a sanction for committing an administrative or criminal offense, the pledge in respect of this property is terminated. In these cases, the pledgee has the right to demand early fulfillment of the obligation secured by the pledge.

Footnote. Article 324 as amended by the Law of the Republic of Kazakhstan dated 07/03/2014 No. 227-V (shall be enforced from 01/01/2015).

Article 325. Assignment of rights under a pledge agreement

1. The pledgee has the right to transfer his rights under the pledge agreement to another person in compliance with the rules on the transfer of the rights of the creditor by assigning the claim (Articles 339-347 of this Code).

2. The assignment by the pledgee of his rights under the pledge agreement to another person is valid if the rights of claim against the debtor under the main obligation secured by the pledge are assigned to the same person.

3. (excluded). Footnote. Article 325 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 326. Transfer of debt under an obligation secured by a pledge

With the transfer of debt under an obligation secured by a pledge to another person, the pledge is terminated unless the pledgor has given the creditor consent to be responsible for the new debtor.

Article 327. Pledge of goods in circulation

1. A pledge of goods in circulation is recognized as a pledge of goods with their leaving with the pledgor and with the provision to the pledgor of the right to change the composition and natural form of the pledged property (inventory, raw materials, supplies, semi-finished products, finished products, etc.).

2. Goods in circulation, alienated by the pledgor, cease to be the subject of a pledge from the moment they pass into ownership, economic management or operational management of the acquirer, and goods purchased by the pledgor, specified in the pledge agreement, become the subject of a pledge from the moment the pledgor acquires the right of ownership or economic management to them.

3. By agreement of the parties, the pledge agreement may provide for the condition that the total value of the pledge of goods in circulation should not become less than the value specified in the pledge agreement.

A decrease in the value of pledged goods in circulation is allowed in proportion to the fulfilled part of the obligation secured by the pledge, unless otherwise provided by the contract.

4. If the pledgor violates the conditions for pledging goods in circulation, the pledge holder has the right, by placing his marks on the pledged goods, to suspend operations with them until the violation is eliminated.

Footnote. Article 327 as amended by the laws of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication); dated 05.24.2018 No. 156-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 04/02/2019 No. 241-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 328. Pledge of things in a pawnshop

1. Acceptance from citizens of movable property intended for personal use as security for short-term microloans can be carried out as a business activity by legal entities registered as pawnshops, whose activities are regulated by the legislation of the Republic of Kazakhstan on microfinance activities.

2. An agreement to pledge things in a pawnshop is formalized by the pawnshop issuing a pawn ticket and may contain a requirement to insure the pledged property, as well as the pledgor’s consent to the out-of-court sale of the pledged item. Insurance of collateral is carried out at the expense of the pawnshop.

2-1. The agreement to pledge things in a pawnshop is terminated in connection with the sale of the pledged item or the transfer of such property into the ownership of the pledgee.

When the pledged property is sold, as well as the transfer of such property into the ownership of the pledgee, simultaneously with the termination of the agreement on pledging things in a pawnshop, the obligation of the borrower, who is also the pledgor, and the agreement on the provision of a microloan are terminated.

The sale of the subject of pledge, as well as the transfer of such property into the ownership of the pledgee under an agreement on the pledge of things in a pawnshop, concluded to secure the execution of an agreement on the provision of a microloan, with the exception of property, the pledge of which is subject to mandatory registration, can be carried out without holding an auction no earlier than one month after the expiration of the repayment period of the microloan, if there is such a condition in the agreement on the pledge of things in a pawnshop.

The sale of the subject of pledge, subject to mandatory registration, is carried out through a public auction no earlier than one month after the expiration of the microloan repayment period. If the subject of pledge, subject to mandatory registration, is not sold at a public auction within sixty calendar days from the date of the start of the auction, the subject of pledge becomes the property of the pawnshop.

The sale of the subject of pledge, as well as the transfer of such property into the ownership of the pledgee under an agreement to pledge things in a pawnshop, concluded to secure the execution of an agreement to provide a microcredit, are not allowed during the period the pledgee is considering the borrower’s appeal for debt settlement in the manner established by the Law of the Republic of Kazakhstan “On Microfinance Activities”.

3. The pawnshop has no right to use and dispose of the pledged items.

4. The pawnshop is liable for loss and damage to the pledged items unless it proves that the loss or damage occurred due to force majeure.

5. Excluded by the Law of the Republic of Kazakhstan dated 07/03/2019 No. 262-VI (enters into force from 01/01/2020).

6. The terms of the agreement on pledging things in a pawnshop, which limit the rights of the pledgor in comparison with the rights granted to him by this Code, are not valid from the moment the agreement is concluded. In lieu of such conditions, the relevant provisions of this Code shall apply.

7. Excluded by the Law of the Republic of Kazakhstan dated 07/03/2019 No. 262-VI (enters into force from 01/01/2020). Footnote. Article 328 as amended by the Law of the Republic of Kazakhstan dated December 23, 2005 No. 107 (the order of enforcement see Article 2); as amended by the laws of the Republic of Kazakhstan dated 02.08.2015 No. 343-V (entered into force from 04/20/2016); dated January 21, 2019 No. 217-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 07/03/2019 No. 262-VI (effective from 01/01/2020); dated 01/02/2021 No. 399-VI (takes effect from 01/01/2021); dated 05/24/2021 No. 43-VII (effective from 10/01/2021).

Paragraph 4. WARRANTY AND GUARANTEE

Footnote. Paragraph 4 as amended by the Law of the Republic of Kazakhstan dated July 11, 1997 No. 154.

Article 329. Guarantee

1. By virtue of a guarantee, the guarantor undertakes to the creditor of another person (debtor) to be responsible for the fulfillment of the obligation of this person in whole or in part jointly and severally with the debtor, with the exception of cases provided for by legislative acts.

2. Persons who jointly gave a guarantee are jointly and severally liable to the creditor, unless otherwise established by the guarantee agreement.

3. A guarantee agreement may also be concluded to secure an obligation that will arise in the future.

Article 330. Surety

By virtue of a guarantee, the guarantor undertakes to the creditor of another person (debtor) to be responsible for the fulfillment of the obligation of this person in full or in part subsidiarily.

Article 331. Grounds and form of guarantee and surety

1. Guarantee and surety arise on the basis of suretyship or guarantee agreements. The application of the guarantee may be established by law.

2. Agreements of guarantee or surety must be made in writing. Failure to comply with the written form entails the nullity of the guarantee or surety agreement.

3. The written form of a guarantee or surety agreement is considered to be complied with if the guarantor or surety notified the creditor in writing of his responsibility for the fulfillment of the obligation by the debtor, and the creditor did not refuse the proposals of the guarantor or surety within the time normally required for this.

4. Second-tier banks may issue bank guarantees and guarantees on the basis of a license from the authorized body in accordance with this Code and taking into account the regulatory legal acts of the authorized body governing the procedure for carrying out these operations.

Issuance by second-tier banks of bank guarantees and sureties without compliance with the norms of this Code and taking into account the requirements of regulatory legal acts of the authorized body entails their invalidity.

Footnote. Article 332 as amended by the laws of the Republic of Kazakhstan dated March 2, 2001 No. 162; dated July 10, 2003 N 483 (effective from January 1, 2004); dated 12.01.2007 No. 225 (shall be enforced from the date of its official publication); dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 332. Liability of the guarantor and surety

1. Unless otherwise established by the contract, a guarantee and surety provide only a valid claim. The guarantor and surety are not exempt from liability if they vouched for a debtor whose incapacity they knew in advance, while the creditor did not know about this circumstance.

2. The guarantor is liable to the creditor to the same extent as the debtor, including payment of a penalty, remuneration (interest), legal costs for debt collection and other losses of the creditor caused by non-fulfillment or improper fulfillment of the obligation by the debtor, unless otherwise provided by the guarantee agreement.

3. The guarantor is liable to the creditor within the amount specified in the guarantee, unless otherwise provided by the terms of the guarantee. Before making claims against the guarantor bearing subsidiary liability, the creditor must take reasonable measures to satisfy this claim by the debtor, in particular, by offsetting the counterclaim and foreclosure in the prescribed manner on the debtor’s property.

Article 333. Rights and obligations of the guarantor in the event of a claim against him by the creditor

1. The guarantor is obliged to notify the debtor about this before satisfying the creditor’s demand, and if a claim is brought against the guarantor, to involve the debtor in participating in the case. Otherwise, the debtor has the right to raise against the guarantor’s reverse claim all the objections that he had against the creditor.

2. The guarantor has the right to raise objections against the creditor’s claim that the debtor could present, unless otherwise follows from the guarantee agreement. The guarantor does not lose the right to these objections even if the debtor renounces them or admits his debt.

Article 334. Rights of the guarantor and surety who have fulfilled the obligation

1. The guarantor who has fulfilled the obligation shall receive all the rights of the creditor under this obligation and the rights that belonged to the creditor as a pledge holder, to the extent that the guarantor satisfied the creditor’s claim. The guarantor also has the right to demand from the debtor payment of a penalty and remuneration (interest) in the amount paid to the creditor, and compensation for other losses incurred in connection with liability for the debtor.

2. Upon fulfillment of the obligation by the guarantor, the creditor is obliged to hand over to the guarantor documents certifying the claim against the debtor and transfer the rights securing this claim.

3. The rules established by paragraphs 1 and 2 of this article apply unless otherwise established by law or the agreement of the guarantor with the debtor and does not follow from the relationship between them.

4. The guarantor acquires the same rights to the extent that he fulfilled the debtor’s obligation to the creditor.

Article 335. Notification of the guarantor and surety about the fulfillment of an obligation by the debtor

A debtor who has fulfilled an obligation secured by a guarantee or surety must immediately notify the guarantor or surety of this. Otherwise, the guarantor or surety, who in turn fulfilled the obligation, has the right to recover from the creditor what was unjustly received or to submit a recourse claim against the debtor. In the latter case, the debtor has the right to recover from the creditor only what was received unjustifiably.

Article 336. Termination of guarantee and surety

1. A guarantee and surety shall terminate with the termination of the obligation secured by it, unless the contract provides for other cases of termination of the guarantee, as well as in the event of a change in this obligation, entailing an increase in liability or other adverse consequences for the guarantor and the surety, without the consent of the latter.

2. The guarantee and surety are terminated with the transfer to another person of the debt under the obligation secured by the guarantee or surety, if the guarantor or surety has not given the creditor consent to be responsible for the new debtor.

3. A guarantee and surety shall be terminated if, upon the maturity of the obligation secured by it, the creditor refuses to accept the proper performance proposed by the debtor or the guarantor and surety.

4. A guarantee and surety shall terminate upon the expiration of the period for which they were given, specified in the guarantee or surety agreement. If such a period is not established, they are terminated if the creditor does not bring a claim against the guarantor or surety within one year from the date of the deadline for fulfillment of the obligation secured by the guarantee or surety. When the deadline for fulfillment of the main obligation is not specified and cannot be determined or determined by the moment of demand, the guarantee and surety are terminated unless the creditor files a claim against the guarantor or surety within two years from the date of conclusion of the guarantee or surety agreement, unless otherwise provided by legislative acts.

Footnote. Article 336 as amended by the Law of the Republic of Kazakhstan dated 02/27/2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Paragraph 5. Deposit

Article 337. Concept of deposit. Deposit agreement form

1. A deposit is recognized as a sum of money given by one of the contracting parties to account for the payments due from it under the contract to the other party and to secure the conclusion and execution of the contract or the fulfillment of another obligation.

2. The agreement on the deposit, regardless of the amount of the deposit, must be concluded in writing. This rule also applies in cases where the main obligation must be notarized. Failure to comply with the written form entails the nullity of the deposit agreement.

Footnote. Article 337 as amended by the laws of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); dated 02.27.2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 338. Consequences of termination and failure to fulfill an obligation secured by a deposit

1. If the obligation is terminated before the start of its performance by agreement of the parties or due to impossibility of performance that occurred without their fault, the deposit must be returned.

2. If the party that gave the deposit is responsible for the failure to fulfill the obligation, it remains with the other party, and if the party that received the deposit is responsible, it is obliged to pay the other party double the amount of the deposit. Moreover, the party responsible for failure to fulfill the obligation is obliged to compensate the other party for losses, taking into account the amount of the deposit, unless otherwise provided in the contract.

Paragraph 6. Retention

Footnote. The Code is supplemented by paragraph 6 in accordance with the Law of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication).      

Article 338-1. General retention provisions

1. The creditor, who has the thing to be transferred to the debtor or a person specified by the debtor, has the right, in the event of failure by the debtor to fulfill on time the obligation to pay for this thing or compensate the creditor for the costs and other losses associated with it, to retain it until the corresponding obligation is fulfilled.

By retaining a thing, claims can also be secured, although not related to payment for the thing or compensation for its costs and other losses, but arising from an obligation, the parties to which act as entrepreneurs.

2. The creditor may retain the thing in his possession despite the fact that after this thing came into the creditor’s possession, the rights to it were acquired by a third party.

3. The rules of this article apply unless otherwise provided by the agreement.

Article 338-2. Satisfying claims through retained property

The claims of the creditor holding the thing are satisfied from its value in the amount and manner provided for satisfying the claims secured by the pledge.

Paragraph 7. Guarantee fee

Footnote. Chapter 18 is supplemented by paragraph 7 in accordance with the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be enforced upon the expiration of ten calendar days after its first official publication).

Article 338-3. The concept of a guarantee deposit

1. A guarantee fee is recognized as a sum of money transferred by the payer of the guarantee fee to the recipient of the guarantee fee to ensure the fulfillment of the obligation to conclude a contract during bidding or the fulfillment of another obligation.

2. The obligation to pay the guarantee fee arises in cases provided for by legislative acts. The obligation to pay the guarantee fee also arises by agreement of the parties.

Article 338-4. Consequences of non-fulfillment, termination or fulfillment of an obligation secured by a guarantee deposit

1. If the obligation secured by the guarantee fee is not fulfilled due to the fault of the payer, the guarantee fee remains with the other party.

2. If the obligation secured by the guarantee deposit is not fulfilled due to the fault of the recipient of the guarantee deposit, or this obligation is terminated by agreement of the parties or due to the impossibility of fulfillment that occurred without their fault, the guarantee deposit is subject to return.

3. When concluding an agreement or fulfilling another obligation secured by a guarantee deposit, the amount of the guarantee deposit is counted against payments due to the recipient of the guarantee deposit from the other party under the concluded agreement or other obligation secured by the guarantee deposit, unless otherwise provided by this Code, other legislative acts, agreement of the parties or follows from the essence of the obligation.

Paragraph 8. Security fee

Footnote. Chapter 18 is supplemented by paragraph 8 in accordance with the Law of the Republic of Kazakhstan dated July 12, 2022 No. 138-VII (shall be enforced upon expiration of sixty calendar days after the day of its first official publication).

Article 338-5. The concept of security payment

A monetary obligation, including the obligation to compensate for losses or pay a penalty in the event of a breach of contract, by agreement of the parties, can be secured by the transfer by one of the parties into the ownership of the other party of a certain amount of money (security payment).

The security deposit may secure an obligation that will arise in the future.

Article 338-6. Fulfillment of an obligation with a security deposit

1. When circumstances stipulated by the contract occur, the amount of the security payment is counted towards the fulfillment of the corresponding obligation.

2. If the circumstances specified in paragraph 1 of this article do not occur within the period stipulated by the contract, or the secured obligation is terminated, the security payment shall be returned to the ownership of the person who previously provided the security payment, unless otherwise provided by the contract.

3. The agreement may provide for the obligation of the relevant party to additionally pay or partially return the security payment upon the occurrence of certain circumstances.

4. No remuneration (interest) is accrued on the amount of the security payment, unless otherwise provided by the laws of the Republic of Kazakhstan or the agreement.

5. The rules on security payment also apply in cases where securities, other financial instruments and (or) things defined by generic characteristics are transferred as security.

Chapter 19. Change of persons in an obligation

Article 339. Grounds and procedure for transferring the creditor’s rights to another person

1. The right (claim) belonging to the creditor on the basis of an obligation may be transferred by him to another person under a transaction (assignment of the claim) or transferred to another person on the basis of a legislative act.

The rules on the transfer of the creditor's rights to another person do not apply to recourse claims.

2. To transfer the rights of a creditor to another person, the consent of the debtor is not required, unless otherwise provided by legislative acts or an agreement.

3. If the debtor was not notified in writing about the transfer of the creditor's rights to another person, the new creditor bears the risk of the adverse consequences caused by this for him. In this case, the fulfillment of the obligation to the original creditor is recognized as fulfillment to the proper creditor.

4. Features of the assignment of the right of claim for certain types of obligations may be established by legislative acts.

Footnote. Article 339 is supplemented by paragraph 4 - Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 340. Rights that cannot be transferred to other persons

The transfer to another person of rights inextricably linked with the personality of the creditor, in particular claims for alimony and compensation for harm caused to life or health, is not allowed.

Article 341. The scope of the rights of the creditor transferred to another person

Unless otherwise provided by legislative acts or agreement, the right of the original creditor passes to the new creditor to the extent and on the conditions that existed at the time of transfer of the right. In particular, the rights ensuring the fulfillment of the obligation, as well as other rights related to the claim, including the right to unreceived remuneration (interest), are transferred to the new creditor.

Footnote. Article 341 was amended by Law of the Republic of Kazakhstan dated July 11, 1997 No. 154.      

Article 342. Evidence of the rights of the new creditor

1. The debtor has the right not to fulfill an obligation to a new creditor until he is provided with evidence of the transfer of the claim to this person.

2. A creditor who has assigned a claim to another person is obliged to transfer to him documents certifying the right of claim and provide information relevant to the implementation of the claim.

Article 343. Debtor’s objections to the new creditor’s claim

The debtor has the right to raise against the claim of the new creditor the objections that he had against the original creditor at the time of receiving notification of the transfer of rights under the obligation to the new creditor.

Article 344. Transfer of the rights of a creditor to another person on the basis of legislative acts

The rights of the creditor under the obligation are transferred to another person on the basis of legislative acts and the occurrence of the circumstances specified therein:

1. as a result of universal succession in the rights of a creditor;

2. by a court decision to transfer the creditor’s rights to another person, when the possibility of such a transfer is provided for by legislative acts;

3. due to the fulfillment of an obligation by its guarantor, surety or pledgor who is not a debtor under this obligation;

4. when the insurer subrogates the rights of the creditor to the debtor responsible for the occurrence of the insured event;

5. in other cases provided for by legislative acts.

Footnote. Article 344 was amended by the Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 345. Conditions for assignment of claims

1. The assignment of a claim by a creditor to another person is permitted, as long as it does not contradict the law or the contract.

2. Without the consent of the debtor, assignment of a claim under an obligation in which the identity of the creditor is of significant importance for the debtor is not allowed.

Article 346. Form of assignment of claim

1. The assignment of a claim based on a transaction made in written (simple or notarial) form must be made in appropriate written form.

2. The assignment of a claim under a transaction requiring state registration must be registered in the manner established for the registration of this transaction.

3. The assignment of a claim on an order security is made by endorsement on this security (clause 3 of Article 132 of this Code).

Article 347. Liability of a creditor who has assigned a claim

The original creditor who assigned the claim is liable to the new creditor for the invalidity of the claim transferred to him, but is not responsible for the failure of the debtor to fulfill this requirement, except for the case when the original creditor assumed guarantee for the debtor to the new creditor, and also unless otherwise provided by this Code or the agreement.

Footnote. Article 347 was amended by the Law of the Republic of Kazakhstan dated June 3, 2003 N 426      

Article 348. Transfer of debt

1. Transfer by a debtor of his debt to another person is permitted only with the consent of the creditor.

2. The new debtor has the right to raise objections against the creditor’s claim based on the relationship between the creditor and the original debtor.

3. The rules contained in paragraphs 1 and 2 of Article 346 of this Code are respectively applied to the form of debt transfer.

4. Features of debt transfer for certain types of obligations may be established by legislative acts.

Footnote. Article 348 is supplemented by paragraph 4 - Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Chapter 20. Liability for breach of obligation

Article 349. Concept of breach of obligation

1. A violation of an obligation is understood as its non-fulfillment or improper fulfillment (untimely, with defects in goods and works, in violation of other conditions determined by the content of the obligation) - improper fulfillment. If it becomes impossible to perform properly, the debtor is obliged to immediately notify the creditor about this.

2. The debtor is held accountable for breach of obligation at the request of the creditor.

Article 350. Compensation for losses caused by breach of obligation

1. A debtor who has violated an obligation is obliged to compensate the creditor for losses caused by the violation (clause 4 of Article 9 of this Code). Compensation for losses in obligations secured by a penalty is determined by the rules provided for in Article 351 of this Code.

2. The agreement of the parties to release the debtor from compensation for losses caused by the violation, adopted before the violation of the obligation, is void, however, the parties, by mutual agreement, can provide for the recovery of only actual damage to property.

3. Unless otherwise provided by law or the contract, when determining damages, the prices that existed in the place where the obligation was to be fulfilled are taken into account on the day the debtor voluntarily satisfied the creditor’s claim, and if the claim was not voluntarily satisfied, on the day the claim was filed. Based on the circumstances, the court may satisfy the claim for damages, taking into account the prices existing on the day of the decision or on the day of actual payment.

4. When determining the amount of lost profit, the measures taken by the creditor to obtain it and the preparations made for this purpose are taken into account.

5. The creditor has the right to demand that any action of the debtor, as well as the owner of his property, be declared invalid if he proves that it was committed with the aim of evading liability for violation of an obligation.

Footnote. Article 350 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 351. Losses and penalties

1. If a penalty is established for non-fulfillment or improper fulfillment of an obligation, then the losses are compensated in the part not covered by the penalty.

Legislative acts of the Republic of Kazakhstan or an agreement may provide for cases: when losses can be recovered in full in excess of the penalty; when, at the choice of the creditor, either a penalty or damages can be recovered.

Cases in which only a penalty can be established for non-fulfillment or improper fulfillment of an obligation are determined by the legislative acts of the Republic of Kazakhstan.

2. In cases where limited liability is established for non-fulfillment or improper fulfillment of an obligation, losses subject to compensation in the part not covered by the penalty, either in excess of or instead of it, may be recovered up to the limits established by such a limitation.

Footnote. Article 351 as amended by the Law of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication).

Article 352. Compensation for moral damage caused by violation of an obligation

Moral damage caused by violation of an obligation is compensated in addition to the losses provided for in Article 350 of this Code.

Article 353. Responsibility for the unlawful use of other people’s money

1. For the unlawful use of someone else’s money as a result of failure to fulfill a monetary obligation or delay in payment, or their unjustified receipt or savings at the expense of another person, a penalty is subject to payment. The amount of the penalty is calculated based on the base rate of the National Bank of the Republic of Kazakhstan on the day of execution of the monetary obligation or its corresponding part. When collecting a debt in court, the court may satisfy the creditor's claim based on the base rate of the National Bank of the Republic of Kazakhstan on the day the claim was filed or on the day the decision was made, or on the day of actual payment at the choice of the creditor. These rules apply unless a different amount of the penalty is established by legislative acts or agreement.

2. A penalty for using someone else’s money is charged on the day the amount of this money is paid to the creditor, unless legislation or an agreement establishes a different procedure for calculating the amount of the penalty.

3. If the losses caused to the creditor by the unlawful use of his money exceed the amount of the penalty due to him on the basis of paragraph 1 of this article, he has the right to demand compensation from the debtor for losses in the amount exceeding this amount.

Footnote. Article 353 - as amended by Zlaw of the Republic of Kazakhstan dated July 11, 1997 N 154; as amended by the laws of the Republic of Kazakhstan dated January 12, 2007 N 225 (shall be enforced from the date of its official publication); dated 01/02/2021 No. 399-VI (takes effect from 01/01/2021).

Article 354. Liability and fulfillment of obligations in kind

1. Payment of a penalty and compensation for losses in the event of improper fulfillment of an obligation does not relieve the debtor from fulfilling the obligation, unless otherwise provided by legislative acts or the contract.

2. Compensation for losses in the event of non-fulfillment of an obligation and payment of a penalty for non-fulfillment shall release the debtor from fulfilling the obligation in kind, unless otherwise provided by legislative acts or the contract.

3. Refusal of the creditor to accept performance, which, due to delay, has lost interest for him (Article 365 of this Code), as well as payment of a sum of money established as compensation (Article 369 of this Code), release the debtor from fulfilling the obligation in kind.

Footnote. Article 354 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 355. Consequences of failure to fulfill the obligation to transfer an individually determined thing

1. In case of failure to fulfill the obligation to transfer an individually defined thing into ownership, economic management, operational management or use of the creditor, the latter has the right to demand the withdrawal of this thing from the debtor and its transfer to the creditor, except in cases where a third party has a preemptive right to this thing.

2. Transfer of a thing does not relieve the debtor from compensation for losses.

Article 356. Fulfillment of an obligation at the expense of the debtor

If the debtor fails to fulfill the obligation to manufacture and transfer the thing to the creditor, or to perform certain work or provide a service for him, the creditor has the right, within a reasonable time, to entrust the fulfillment of the obligation to third parties for a reasonable price or to perform it on his own, unless otherwise follows from the law, the contract or the essence of the obligation, and demand from the debtor compensation for necessary expenses and other losses incurred.

Article 357. Vicarious liability

1. Before making claims against a person who, in accordance with the law or the terms of the obligation, is liable in addition to the liability of another person who is the main debtor (subsidiary liability), the creditor must make a claim against the main debtor.

If the principal debtor refused to satisfy or did not fully fulfill the creditor’s demand or the creditor did not receive from him within a reasonable time a response to the presented demand, this demand in the unfulfilled part may be presented to the person bearing subsidiary liability.

2. The creditor has no right to demand satisfaction of his claim against the principal debtor from a person bearing subsidiary liability if this claim can be satisfied by offsetting a counterclaim against the principal debtor (Article 370 of this Code).

3. A person bearing subsidiary liability must, before satisfying the claim presented to him by the creditor, notify the principal debtor about this, and if a claim is brought against such a person, involve the principal debtor in participating in the case.

Otherwise, the principal debtor has the right to raise against the recourse claim of the person liable subsidiaryly the objections that he had against the creditor.

Footnote. Article 357 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 358. Limitation of the amount of liability for obligations

1. For certain types of obligations and for obligations related to a certain type of activity, legislative acts may limit the right to full compensation for losses (limited liability).

2. An agreement to limit the amount of liability of the debtor under an adhesion agreement or another agreement in which the creditor is a citizen acting as a consumer is void if the amount of liability for a given type of obligation or for a given violation is determined by law.

Footnote. Article 358 as amended by the laws of the Republic of Kazakhstan dated March 2, 1998 N 211; dated 02.27.2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 359. Grounds for liability for breach of obligation

1. The debtor is responsible for non-fulfillment and (or) improper fulfillment of an obligation in the presence of guilt, unless otherwise provided by law or the contract. The debtor is declared innocent if he proves that he took all measures within his power to properly fulfill the obligation.

2. A person who fails to fulfill or improperly fulfills an obligation when carrying out business activities bears property liability unless he proves that proper fulfillment was impossible due to force majeure, that is, extraordinary and unpreventable circumstances under the given conditions (natural phenomena, military actions, state of emergency, etc.). Such circumstances do not include, in particular, the absence on the market of goods, works or services necessary for execution.

Legislation or an agreement may provide for other grounds for liability or exemption from it.

3. An agreement concluded in advance to eliminate or limit liability for intentional violation of an obligation is void.

Footnote. Article 359 as amended by the laws of the Republic of Kazakhstan dated February 27, 2017 No. 49-VI (shall be brought into force upon the expiration of ten calendar days after the day of its first official publication); ); dated 07/03/2020 359-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 360. Entrepreneurial risk in an obligation

If the obligation provides for the performance of any work ordered by the entrepreneur, the risk of impossibility or inexpediency of using the results of the work rests with the entrepreneur. A person who has properly performed the work has the right to receive payment in proportion to the degree of completion, except in cases where the contract provides for a different distribution of business risk.

Article 361. Consequences of impossibility of fulfilling a bilateral agreement

If in a bilateral contract performance has become impossible for one party due to a circumstance for which neither party is responsible, then neither party, unless otherwise provided in a legislative act or contract, has the right to demand performance of the contract. Each of the parties has the right to demand in this case the return of everything that it has performed without receiving a corresponding counter-performance.

Article 362. Responsibility of the debtor for its employees

The actions of officials or other employees of the debtor to fulfill his obligation are considered to be the actions of the debtor. The debtor is responsible for these actions if they lead to non-fulfillment or improper fulfillment of the obligation.

Article 363. Liability of the debtor for the actions of third parties

1. The debtor is liable to the creditor in cases where the violation of the obligation was caused by the actions or inaction of third parties under their obligations to the debtor.

The debtor is also responsible for the actions or inaction of third parties who were entrusted by the debtor with the fulfillment of his obligation to the creditor, unless the law establishes that the direct executor bears responsibility.

2. The debtor may be released from liability for violation of an obligation caused by the actions or inaction of third parties by proving their innocence.

When carrying out business activities, the debtor may be released from liability for a violation caused by the actions or inaction of third parties if this is due to force majeure (clause 2 of Article 359 of this Code).

3. In case of violation of an obligation associated with encumbering the subject of the obligation with the rights of third parties, the debtor is released from liability only if such encumbrances arose before the conclusion of the agreement with the creditor and the latter was warned about them when concluding the agreement.

4. Legislation or an agreement may provide for other conditions for the debtor’s liability for the actions of third parties.

Article 364. Fault of the creditor

1. If non-fulfillment or improper fulfillment of an obligation occurred through the fault of both parties, the court accordingly reduces the amount of liability of the debtor. The court also reduces the amount of liability of the debtor if the creditor intentionally or negligently contributed to an increase in the amount of losses caused by non-performance or improper performance, or did not take reasonable measures to reduce them.

2. The rules of paragraph 1 of this article accordingly apply in cases where the debtor, by virtue of a legislative act or contract, is liable for non-fulfillment or improper fulfillment of an obligation, regardless of his guilt.

Footnote. Article 364 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.      

Article 365. Debtor’s delay

1. A debtor who is late in performance is liable to the creditor for losses caused by the delay and for the consequences of an impossibility of performance that accidentally occurred during the delay.

2. If, due to the debtor’s delay, the performance has lost interest for the creditor, he may refuse to accept the performance and demand compensation for losses.

3. The debtor is not considered to be in default until the obligation cannot be fulfilled due to the creditor’s delay (Article 366 of this Code).

Article 366. Lender's delay

1. The creditor is considered to be in default if he refused to accept the proper performance proposed by the debtor, or did not perform actions provided for by law or contract or arising from business customs or from the essence of the obligation, before which the debtor could not fulfill his obligation.

The creditor is also considered to be in default if he refuses to properly confirm the fulfillment of the obligation by the debtor.

2. The creditor’s delay gives the debtor the right to compensation for losses caused by the delay, unless the creditor proves that the delay occurred due to circumstances for which neither he himself nor those persons who, by virtue of legislation or the creditor’s instructions, were entrusted with accepting the performance, are not responsible.

The creditor who has committed a delay bears all the adverse consequences of the accidental impossibility of fulfilling the obligation that occurred during the delay.

3. Under a monetary obligation, the debtor is not obliged to pay remuneration (interest) for the time of delay of the creditor.

Footnote. Article 366 was amended by Law of the Republic of Kazakhstan dated July 11, 1997 No. 154.

Chapter 21. Termination of obligation

Article 367. Grounds for termination of an obligation

1. Obligations are terminated in whole or in part by fulfillment, provision of compensation, set-off, novation, forgiveness of debt, coincidence of debtor and creditor in one person, impossibility of fulfillment, issuance of an act of a state body, death of a citizen, liquidation of a legal entity.

2. Termination of an obligation at the request of one of the parties is permitted only in cases provided for by legislation.

3. Legislation and agreement may provide for other grounds for termination of obligations.

Article 368. Termination of an obligation by performance

1. Proper performance terminates the obligation.

2. (deleted) Footnote. Article 368 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 369. Compensation

By agreement of the parties, the obligation can be terminated by providing compensation in exchange for execution (payment of money, transfer of property, etc.). The amount, terms and procedure for providing compensation are established by the parties.

Article 370. Termination of an obligation by offset

1. The obligation is terminated in full or in part by offsetting a counterclaim of the same type, the due date of which has come, or the due date of which has not been specified or is determined by the moment of demand. For offset, a statement from one party is sufficient.

2. Offsetting claims is not allowed:

1. if, at the request of one of the parties, the claim is subject to a limitation period and this period has expired;

2. for compensation for harm caused to life or health;

3. on the collection of alimony;

4. about lifelong maintenance;

4-1) to a bank, a branch of a non-resident bank of the Republic of Kazakhstan, deprived of a license or in the process of conservation or liquidation (termination of activities), if the creditor’s claims arise from an agreement (agreements) on the assignment of the right of claim;

5. in other cases provided for by law or agreement.

3. In case of assignment of a claim, the debtor has the right to set off against the claim of the new creditor his counterclaim against the original creditor.

Set-off is carried out if the claim arose on the basis that existed at the time the debtor received notice of the assignment of the claim, and the term of the claim came before its receipt, or this period is not specified or is determined by the moment of demand.

Footnote. Article 370 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 12/23/2005 N 107 (the order of enforcement see Article 2 of Law N 107); dated 02/10/2011 No. 406-IV (shall be enforced upon expiration of ten calendar days after its first official publication; dated 01/02/2021 No. 399-VI (effective from 12/16/2020).

Article 371. Termination of an obligation by the coincidence of the debtor and the creditor in one person

An obligation is terminated by the coincidence of the debtor and the creditor in one person.

Article 372. Termination of an obligation by novation

1. An obligation is terminated by an agreement of the parties to replace the original obligation that existed between them with another obligation between the same persons, providing for a different subject or method of fulfillment (novation).

2. Novation is not allowed in relation to obligations to compensate for harm caused to life or health, and to pay alimony.

3. Novation terminates additional obligations associated with the original one, unless otherwise provided by agreement of the parties.

Footnote. Article 372 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 373. Debt forgiveness

The obligation is terminated by the creditor releasing the debtor from his obligations, if this does not violate the rights of other persons in relation to the creditor's property.

Article 374. Termination of an obligation due to impossibility of fulfillment

1. An obligation is terminated by the impossibility of fulfillment if it is caused by a circumstance for which the debtor is not responsible. This rule does not apply to monetary obligations.

2. If a party is unable to fulfill an obligation caused by a circumstance for which neither one nor the other party is responsible, it has no right to demand performance of the obligation from the other party, unless otherwise provided by law or the contract. In this case, each party that has fulfilled the obligation has the right to demand the return of what was performed.

3. If it is impossible for the debtor to fulfill an obligation caused by the guilty actions of the creditor, the latter has no right to demand the return of what he has fulfilled under the obligation.

Article 375. Termination of an obligation based on an act of a state body

1. If, as a result of the issuance of an act by state bodies, including local representative and executive bodies (public act), the fulfillment of an obligation becomes impossible in whole or in part, the obligation is terminated in whole or in the relevant part. The parties who suffered losses as a result of this have the right to demand compensation in accordance with this Code.

2. If, in accordance with the established procedure, a public act on the basis of which the obligation has terminated is declared invalid, the obligation is restored, unless otherwise follows from the agreement of the parties or the essence of the obligation and the fulfillment has not lost interest for the creditor.

Article 376. Termination of an obligation by the death of a citizen

1. An obligation is terminated by the death of the debtor if fulfillment cannot be carried out without the personal participation of the debtor or the obligation is otherwise inextricably linked with the personality of the debtor.

2. An obligation is terminated by the death of the creditor if the performance is intended personally for the creditor or the obligation is otherwise inextricably linked with the personality of the creditor.

Article 377. Termination of an obligation by liquidation of a legal entity

1. An obligation is terminated by the liquidation of a legal entity (debtor or creditor), except in cases where the legislation assigns the fulfillment of the obligation of a liquidated legal entity to another legal entity (for obligations arising as a result of harm to life and health, etc.).

2. Termination of activities or reorganization of state bodies, including local representative and executive bodies, does not entail the termination of obligations not fulfilled by these bodies. The fulfillment of these obligations is entrusted to the body that has budget funds at its disposal, unless the decision to terminate the activities or reorganize the relevant bodies determines another state body that is entrusted with the fulfillment of the obligation.

Footnote. Article 377 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

Subsection 2. General provisions on the agreement

Chapter 22. Concept and terms of the contract

Article 378. Concept of contract

1. A contract is an agreement between two or more persons to establish, change or terminate civil rights and obligations.

2. The rules on bilateral and multilateral transactions provided for in Chapter 4 of this Code are applied to the agreement.

3. For agreements concluded by more than two parties (multilateral agreements), the general provisions on the agreement apply, unless this contradicts the multilateral nature of such agreements.

Article 379. Legal relations arising from an agreement

1. An obligatory, proprietary, copyright or other legal relationship may arise from an agreement.

2. The general provisions on obligations (Article 268-377 of this Code) apply to obligations arising from the contract, unless otherwise provided the rules of this chapter and the rules on certain types of contracts contained in this Code.

3. The provisions of this chapter apply to property, copyright or other legal relations arising from an agreement (joint activity agreement, constituent agreement, author's agreement and others), unless otherwise follows from the legislation, agreement or the essence of the legal relationship.

Article 380. Freedom of contract

1. Citizens and legal entities are free to enter into contracts. Compulsion to enter into an agreement is not permitted, except in cases where the obligation to enter into an agreement is provided for by this Code, legislative acts or a voluntarily accepted obligation.

1-1. It is prohibited to conclude any agreements related to the acquisition of ownership or other real rights of an individual, legal entity and (or) a person operating in accordance with an agreement on joint activity (simple partnership, consortium) for an apartment and (or) non-residential premises or an individual residential building, or their share in the field of shared participation in housing construction in a multi-apartment residential building or a complex of individual residential buildings under construction, without complying with the requirements of the Law of the Republic of Kazakhstan "On shared participation in housing construction."

2. The parties may enter into an agreement, either provided for or not provided for by law.

Footnote. Article 380 as amended by the Law of the Republic of Kazakhstan dated June 30, 2025 No. 204-VIII (put into effect expiration of sixty calendar days after the day of its first official publication).

Article 381. Mixed contract

The parties may enter into an agreement that contains elements of various agreements provided for by law (mixed agreement). The relations of the parties under a mixed contract are applied in the relevant parts to the legislation on contracts, the elements of which are contained in the mixed contract, unless otherwise follows from the agreement of the parties or the essence of the mixed contract.

Article 382. Determination of the terms of the contract

1. The terms of the agreement are determined at the discretion of the parties, except in cases where the content of the relevant term is prescribed by law.

In cases where a condition of the contract is provided for by a norm that is in force in accordance with the law, unless otherwise established by agreement of the parties (dispositive norm), the parties may, by their agreement, exclude its application or establish a condition different from that provided for in it. In the absence of such an agreement, the terms of the contract are determined by a dispositive norm.

2. If the terms of the contract are not determined by the parties or by a dispositive norm, the relevant conditions are determined by the customs of business practice applicable to the relations of the parties.

Article 383. Contract and legislation

1. The agreement must comply with the rules obligatory for the parties, established by law (imperative norms) in force at the time of its conclusion.

2. If, after the conclusion of an agreement, the legislation establishes rules binding on the parties, other than those that were in force at the conclusion of the agreement, the terms of the concluded agreement remain in force, except in cases where the legislation establishes that its effect extends to relations arising from previously concluded agreements.

Article 384. Paid and gratuitous contract

1. An agreement under which a party must receive payment or other consideration for the performance of its obligations is compensated.

2. A gratuitous agreement is an agreement under which one party undertakes to provide something to the other party without receiving payment or other consideration from it.

3. The contract is assumed to be compensated, unless otherwise follows from the legislation, content or essence of the contract.

Article 385. Price

1. The execution of the contract is paid at the price established by agreement of the parties.

In cases provided for by legislative acts, prices (tariffs, rates, rates, etc.) established or regulated by authorized state bodies are applied.

2. Changing the price after concluding an agreement is permitted in cases and on the conditions provided for by the agreement, legislative acts or in the manner established by legislative acts.

3. In cases where a price is not provided for in a compensation contract and cannot be determined based on the terms of the contract, it is considered that the contract must be executed at the price that, at the time of concluding the contract under comparable circumstances, was usually charged for similar goods, work or services.

Article 386. Validity of the contract

1. The agreement comes into force and becomes binding on the parties from the moment of its conclusion (Article 393 of this Code).

2. The parties have the right to establish that the terms of the agreement they have concluded apply to their relations that arose before the conclusion of the agreement.

3. If legislation or an agreement provides for a period of validity of the agreement, the end of this period entails the termination of the obligations of the parties under the agreement.

An agreement that does not indicate the duration of its validity is recognized as valid until the moment specified in it when the parties fulfill the obligation.

4. The expiration of the contract does not relieve the parties from liability for its violation that occurred before the expiration of this period.

Article 387. Public contract

1. A public contract is an agreement concluded by a person carrying out entrepreneurial activities and establishing his obligations for the sale of goods, performance of work or provision of services, which such person, by the nature of his activities, must carry out in relation to everyone who applies to him (retail trade, transportation by public transport, communication services, energy supply, medical, hotel services, etc.).

A person carrying out entrepreneurial activities does not have the right to give preference to one person over another with regard to concluding a public contract, except in cases provided for by the legislative acts of the Republic of Kazakhstan.

2. The price of goods, works and services, as well as other terms of the public contract, are established the same for all consumers, with the exception of cases where the law allows for the provision of benefits for certain categories of consumers.

3. Refusal of a person carrying out entrepreneurial activity to conclude a public contract if there is an opportunity to provide the consumer with the corresponding goods (work, services) is not allowed.

In the event of an unjustified evasion by a person carrying out entrepreneurial activities from concluding a public contract, the provisions provided for in paragraph 4 of Article 399 of this Code are applied.

4. In cases provided for by legislative acts, the Government of the Republic of Kazakhstan may issue rules binding on the parties when concluding and executing public contracts (model contracts, regulations, etc.).

5. The terms of a public contract that do not meet the requirements established by paragraphs 2 and 4 of this article are void.

Footnote. Article 387 as amended by the laws of the Republic of Kazakhstan dated July 11, 1997 N 154; dated 02/27/2017 No. 49-VI (shall be enforced ten calendar days after the day of its first official publication).

Article 388. Sample terms of contracts

1. The contract may provide that its individual terms are determined by sample terms developed for contracts of the corresponding type and published in the press.

2. In cases where the agreement does not contain a reference to exemplary conditions, such exemplary conditions are applied to the relations of the parties as business practices if they meet the requirements established by Articles 3 and 382 of this Code.

3. Sample conditions may be set out in the form of a sample agreement or other document containing these conditions.

Article 389. Agreement of adhesion

1. An agreement of adhesion is an agreement, the terms of which are determined by one of the parties in forms or other standard forms and can be accepted by the other party only by acceding to the proposed agreement as a whole.

1-1. The legislative act of the Republic of Kazakhstan on social protection may provide for the specifics of concluding an accession agreement and requirements for its content.

2. The party that has acceded to the contract has the right to demand termination of the contract if the contract of accession, although not contrary to the law, deprives this party of the rights usually granted under contracts of this type, excludes or limits the liability of the other party for violation of obligations, or contains other conditions that are clearly burdensome for the acceding party, which it, based on its reasonably understood interests, would not accept if it had the opportunity to participate in determining the terms of the contract.

3. In the presence of the circumstances provided for in paragraph 2 of this article, the demand for termination of the contract made by the party that has acceded to the contract in connection with the implementation of its business activities shall not be satisfied if the acceding party knew or should have known on what terms it was concluding the contract.

Footnote. Article 389 as amended by the Law of the Republic of Kazakhstan dated June 21, 2013 No. 106-V (shall be brought into force after ten calendar days after its first official publication); dated 04/20/2023 No. 226-VII (takes effect from 07/01/2023).

Article 390. Preliminary agreement

1. Under a preliminary agreement, the parties undertake to enter into a future agreement on the transfer of property, performance of work or provision of services (main agreement) on the terms stipulated by the preliminary agreement.

2. The preliminary agreement is concluded in the form established by law for the main agreement, and if the form of the main agreement is not established, then in writing. Failure to comply with the rules on the form of the preliminary agreement entails its nullity.

3. The preliminary contract must contain conditions allowing to establish the subject matter, as well as other essential conditions of the main contract.

4. The preliminary agreement specifies the period within which the parties undertake to conclude the main agreement.

If such a period is not specified in the preliminary agreement, the agreement provided for by it must be concluded within a year from the date of conclusion of the preliminary agreement.

5. In cases where the party that has entered into a preliminary agreement evades concluding the agreement stipulated by it, it is obliged to compensate the other party for the losses caused by this, unless otherwise provided by law or the agreement.

6. The obligations stipulated by the preliminary agreement are terminated if, before the end of the period within which the parties must conclude the main agreement, it is not concluded or one of the parties does not send the other party an offer to conclude this agreement.

7. A protocol of intent (agreement of intent), unless it directly stipulates the intentions of the parties to give it the force of a preliminary agreement, is not a civil law agreement, and its failure does not entail legal consequences.

8. It is prohibited to conclude a preliminary agreement related to the acquisition of ownership or other real rights of an individual, legal entity and (or) a person operating in accordance with an agreement on joint activity (simple partnership, consortium) for an apartment and (or) non-residential premises or an individual residential building, or their share in the field of shared participation in housing construction in a multi-apartment residential building or a complex of individual residential buildings under construction, without complying with the requirements of the Law of the Republic of Kazakhstan "On shared ownership participation in housing construction."

Footnote. Article 390 as amended by the laws of the Republic of Kazakhstan dated 03/02/1998 N 211; dated 02.27.2017 No. 49-VI (shall be enforced upon the expiration of ten calendar days after the day of its first official publication); dated 06/30/2025 No. 204-VIII (shall be introduced into effect upon expiration of sixty calendar days after the day of its first official publication).

Article 391. Agreement in favor of a third party

1. An agreement in favor of a third party is an agreement in which the parties have established that the debtor is obliged to perform the obligation not to the creditor, but to a third party, specified or not specified in the agreement and who has the right to demand from the debtor the fulfillment of the obligation in his favor.

2. Unless otherwise provided by law or contract, from the moment a third party expresses to the debtor an intention to exercise their right under the contract, the parties cannot terminate or change the contract they have concluded without the consent of the third party.

3. The debtor in the contract has the right to raise objections against the claim of a third party that he could raise against the creditor.

4. In the event that a third party has renounced the right granted to him under the agreement, the creditor may exercise this right if this does not contradict the law and the agreement.

5. From the moment a third party expresses its intention to exercise its right under the contract and until the third party renounces its right, the creditor has the right to demand from the debtor only the fulfillment of an obligation in favor of the third party in accordance with the terms of the contract.

Footnote. Article 391 as amended by the Law of the Republic of Kazakhstan dated March 25, 2011 No. 421-IV (shall be brought into force after ten calendar days after its first official publication).

Article 392. Interpretation of the contract

1. When interpreting the terms of a contract, the court takes into account the literal meaning of the words and expressions contained in it. The literal meaning of a contract term, if it is unclear, is established by comparison with other terms and the meaning of the contract as a whole.

2. If the rules contained in paragraph one of this article do not allow determining the content of the contract, the actual common will of the parties must be ascertained, taking into account the purpose of the contract. In this case, all relevant circumstances are taken into account, including negotiations and correspondence preceding the contract, the practice established in the mutual relations of the parties, business customs, and subsequent behavior of the parties.

Chapter 23. Conclusion of an agreement

Article 393. Essential terms of the contract

1. An agreement is considered concluded when an agreement is reached between the parties, in the form required in appropriate cases, on all its essential terms.

Essential are the conditions on the subject of the contract, conditions that are recognized as essential by law or necessary for contracts of this type, as well as all those conditions regarding which, at the request of one of the parties, an agreement must be reached.

2. If, in accordance with legislative acts, the transfer of property is necessary to conclude an agreement, the agreement is considered concluded from the moment of transfer of the relevant property.

Article 394. Form of agreement

1. If the parties have agreed to conclude an agreement in a certain form, it is considered concluded from the moment it is given the agreed form, even if this form was not required by law for this type of agreement.

2. The written form of the agreement is considered to be complied with if the written proposal to conclude an agreement is accepted in the manner prescribed by paragraph 3 of Article 396 of this Code.

Article 395. Offer

1. An offer is an offer to conclude a contract made to one or more specific persons, if it is sufficiently definite and expresses the intention of the person who made the offer to consider himself bound in the event of its acceptance (acceptance). A proposal is sufficiently definite if it specifies the essential terms of the contract or the procedure for determining them.

2. The offer binds the person who sent it from the moment it is received by the addressee.

If the notice of withdrawal of the offer was received earlier or simultaneously with the offer itself, the offer is considered not received.

3. An offer received by the addressee cannot be withdrawn within the period established for its acceptance, unless otherwise specified in the offer itself or follows from the essence of the offer or the situation in which it was made.

4. Advertising and other offers addressed to an indefinite number of persons are considered as an invitation to make offers, unless otherwise expressly stated in the offer.

5. A proposal containing all the essential terms of the contract, from which the will of the person making the proposal is discerned, to conclude a contract on the terms specified in the proposal with anyone who responds, is recognized as an offer (public offer).

Article 396. Acceptance

1. Acceptance is the response of the person to whom the offer is addressed regarding its acceptance.

Acceptance must be complete and unconditional.

2. Silence is not acceptance, unless otherwise follows from a legislative act, business custom or from previous business relations of the parties.

3. The performance by the person who received the offer, within the period established for its acceptance, of actions to fulfill the terms of the contract specified in it (shipment of goods, provision of services, performance of work, payment of the appropriate amount, etc.) is considered acceptance, unless otherwise provided by law or specified in the offer.

4. If notice of the revocation of acceptance was received by the person who sent the offer earlier or simultaneously with the acceptance itself, the acceptance is considered not received.

Article 397. Procedure for concluding an agreement

1. When an offer contains a period for acceptance, the contract is considered concluded if acceptance is received by the person who sent the offer within the period specified in it.

2. When a written or electronic offer does not contain a deadline for acceptance, the contract is considered concluded if acceptance is received by the person who sent the offer before the end of the period established by law, and if such a period is not established, within the time required for this.

When an offer is made orally without specifying a time limit for acceptance, the contract is considered concluded if the other party immediately declares its acceptance.

3. In cases where a timely sent notice of acceptance is received late, the acceptance is not considered late unless the party sending the offer immediately notifies the other party of the late receipt of acceptance.

If the party that sent the offer immediately notifies the other party of the acceptance of its late acceptance, the contract is considered concluded.

4. A response indicating consent to conclude an agreement on conditions other than those proposed in the offer is not acceptance.

Such a response is recognized as a refusal of the offer and at the same time a new offer.

Footnote. Article 397 as amended by the Law of the Republic of Kazakhstan dated November 24, 2015 No. 419-V (entered into force 01/01/2016).

Article 398. Place of conclusion of the contract

If the contract does not indicate the place of its conclusion, the contract is recognized as concluded at the place of residence of the citizen or the location of the legal entity that sent the offer.

Article 399. Mandatory conclusion of a contract

1. In cases where, in accordance with this Code or other legislative acts, the conclusion of an agreement is mandatory for one of the parties, this party must send to the other party a notice of acceptance, or refusal of acceptance, or acceptance of an offer (draft agreement) on other conditions (protocol of disagreements to the draft agreement) within thirty days from the date of receipt of the offer, unless another period is established by law or is not agreed upon by the parties.

2. The party that sent the offer and received from the party for whom the conclusion of the contract is mandatory a notice of its acceptance on other terms (protocol of disagreements to the draft contract), has the right to submit the disagreements that arose during the conclusion of the contract to the court for consideration within thirty days from the date of receipt of such notice or the expiration of the period for acceptance, unless the legislation on certain types of contracts does not establish a different period.

3. In cases where a protocol of disagreements to the draft agreement is received within thirty days regarding a draft agreement sent by a party for whom the conclusion of an agreement is mandatory, this party is obliged, within thirty days from the date of receipt of the protocol of disagreements, to notify the other party of the acceptance of the agreement in its wording or of the rejection of the protocol of disagreements.

If the protocol of disagreements is rejected or notification of the results of its consideration is not received within the specified period, the party that sent the protocol of disagreements has the right to submit the disagreements that arose during the conclusion of the agreement to the court, unless otherwise established by the legislation on certain types of agreements.

4. If a party for whom, in accordance with this Code or other legislative acts, the conclusion of an agreement is obligatory, avoids concluding it, the other party has the right to apply to the court with a demand to compel the conclusion of an agreement.

A party that unreasonably avoids concluding a contract must compensate the other party for losses caused by refusal to conclude a contract.

Article 400. Pre-contractual disputes

In the cases provided for in paragraphs 2 and 3 of Article 399 of this Code, and also if the disagreements that arose during the conclusion of the contract were, by agreement of the parties, submitted to the court for consideration, the terms of the contract on which the parties had disagreements are determined in accordance with the court decision.

Chapter 24. Change and termination of the contract

Article 401. Grounds for amendment and termination of the contract

1. Amendments and termination of the contract are possible by agreement of the parties, unless otherwise provided by this Code, other legislative acts and the contract.

2. At the request of one of the parties, the contract can be changed or terminated by a court decision only:

1. in case of a significant violation of the contract by the other party;

2. in other cases provided for by this Code, other legislative acts or agreement.

A violation of the contract by one of the parties is considered significant, which entails such damage for the other party that it is significantly deprived of what it had the right to count on when concluding the contract.

3. The contract is considered amended or terminated in the event of a unilateral refusal to fulfill the contract (refusal of the contract, respectively, partially or completely (Article 404 of this Code).

Footnote. Paragraph 3 of Article 401 in the new wording - Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 402. Procedure for amending and terminating a contract

1. An agreement to amend and terminate a contract is made in the same form as the contract, unless otherwise follows from the legislation, contract or business customs.

2. A demand to change or terminate a contract may be submitted by a party to the court only after receiving a refusal from the other party to the proposal to change or terminate the contract or failure to receive a response within the period specified in the proposal or established by law or the contract, and in its absence - within thirty days.

Article 403. Consequences of termination and amendment of the contract

1. Upon termination of the contract, the obligations of the parties cease.

2. If the contract is changed, the obligations of the parties continue to apply in the modified form.

3. In the event of termination or modification of the contract, obligations are considered terminated or modified from the moment the parties reach an agreement on the modification or termination of the contract, unless otherwise follows from the agreement of the parties or the nature of the modification of the contract, and in the case of termination or modification of the contract in court - from the moment the court decision on termination or modification of the contract enters into legal force.

4. The parties do not have the right to demand the return of what they performed under the obligation before the termination or modification of the contract, unless otherwise established by legislative acts or agreement of the parties.

5. If the basis for termination or modification of the contract was a significant violation of the contract by one of the parties, the other party has the right to demand compensation for losses caused by termination or modification of the contract.

Footnote. Article 403 was amended by Law of the Republic of Kazakhstan dated March 2, 1998 No. 211.

Article 404. Unilateral refusal to fulfill the contract (repudiation of the contract)

1. Unilateral refusal to execute a contract (repudiation of the contract) is permitted in cases provided for by this Code, other legislative acts or agreement of the parties.

2. One of the parties has the right to refuse to perform the contract in the following cases:

1. impossibility of fulfilling an obligation based on an agreement (Article 374 of this Code);

2. declaring the other party bankrupt in the prescribed manner, unless otherwise established by the legislative act of the Republic of Kazakhstan on rehabilitation and bankruptcy;

3. changes or cancellation of the act of the state body on the basis of which the contract was concluded.

3. Unilateral refusal to fulfill a contract is permitted in cases where the contract was concluded without specifying a period, unless otherwise provided by legislative acts or agreement of the parties.

4. In the event of a unilateral refusal to fulfill the contract, a party must notify the other party about this no later than a month in advance, unless otherwise provided by this Code, other legislative acts or agreement of the parties.

Footnote. Article 404 as amended by the Law of the Republic of Kazakhstan dated 03/02/1998 N 211; as amended by the Law of the Republic of Kazakhstan dated 03/07/2014 No. 177-V (shall be brought into force ten calendar days after the day of its first official publication).

Article 405. Extension of the contract

The parties have the right to extend the agreement for a new period.

Extension of the contract term is carried out according to the rules Article 397 of this Code.