Document from CIS Legislation database © 2003-2021 SojuzPravoInform LLC

CODE OF THE REPUBLIC OF KAZAKHSTAN

of December 27, 2017 No. 125-VI ZRK

About subsoil and subsurface use

(as amended on 09-03-2021)

General part

Section I. Basic provisions

Chapter 1. General provisions

Article 1. Legislation of the Republic of Kazakhstan on subsoil and subsurface use

1. The legislation of the Republic of Kazakhstan on subsoil and subsurface use is based on the Constitution of the Republic of Kazakhstan and consists of of this Code and other regulatory legal acts of the Republic of Kazakhstan.

2. If the international treaty ratified by the Republic of Kazakhstan establishes other rules, than those which contain in this Code then are applied rules of the international treaty.

3. In contradiction cases between this Code and other laws of the Republic of Kazakhstan containing the regulations governing the relations in the field of subsurface use provisions of this Code are applied.

4. The civil legislation of the Republic of Kazakhstan is applied to the relations in the field of subsurface use in cases when they are not settled by regulations of this Code.

Article 2. The relations regulated by this Code

1. This Code determines the mode of use of natural resources, procedure of public administration and regulation in the field of subsurface use, features of origin, implementation and the termination of the rights to subsoil plots, legal status of subsoil users and carrying out the corresponding transactions by them, and also questions of use of natural resources and the order the right of subsurface use and other relations connected with use of resources of subsoil.

2. Use of lands, water and other natural resources is regulated according to the land, water and ecological legislation of the Republic of Kazakhstan determining the mode of use and protection of the appropriate natural resources.

3. Participants of the relations regulated by this Code are the state, citizens and legal entities of the Republic of Kazakhstan.

4. Foreigners, stateless persons, and also foreign legal entities have the rights and freedoms in the Republic of Kazakhstan and perform the duties in the relations on subsurface use established for citizens and legal entities of the Republic of Kazakhstan if other is not provided by this Code, the laws and international treaties ratified by the Republic of Kazakhstan.

Article 3. Purpose and tasks of the legislation of the Republic of Kazakhstan on subsoil and subsurface use

1. The purpose of the legislation of the Republic of Kazakhstan on subsoil and subsurface use is ensuring sustainable development of mineral resources of the Republic of Kazakhstan for the economic growth of the state and welfare of society.

2. Tasks of the legislation of the Republic of Kazakhstan on subsoil and subsurface use are:

1) protection of the property right of the state to subsoil;

2) realization of state policy and regulation of the relations in the field of subsurface use;

3) respect for interests of the state, citizens of the Republic of Kazakhstan and rights of subsoil users;

4) surplus of mineral resources of the Republic of Kazakhstan;

5) establishment of the bases, conditions and procedure for origin, implementation, change and termination of mineral rights;

6) providing the legal basis for sustainable development of subsurface use;

7) creation of conditions for investment attraction in geological studying of subsoil and subsurface use;

8) strengthening of legality in the field of subsurface use.

Article 4. Principles of the legislation of the Republic of Kazakhstan on subsoil and subsurface use

Legal regulation of the relations in the field of subsurface use is based on the principles:

1) rational management of subsoil of the state fund;

2) providing ecological safety when using natural resources;

3) availability of information in the field of subsurface use;

4) subsurface use paid nature;

5) conscientiousness of subsoil users;

6) stability of conditions of subsurface use.

Article 5. Rational management of subsoil of the state fund

Rational management of subsoil of the state fund is provided with provision of the right of subsurface use for the purpose of the economic growth of the state and welfare of society.

Article 6. Ecological safety when using natural resources

Subsurface use shall be performed by ecologically safe methods with taking measures, the subsoil directed to prevention of pollution and decrease in harmful effects on the environment.

Article 7. Availability of information in the field of subsurface use

1. Information in the field of subsurface use is available if other is not provided by this Code or other laws of the Republic of Kazakhstan.

2. The state provides open access to:

1) information on auctions for provision of the right of subsurface use, their conditions and results;

2) to decisions of state bodies on provision and termination of the right of subsurface use;

3) information on the subsurface use right taking into account transaction types on subsurface use;

4) geological information, except for the geological information recognized confidential according to this Code or the Republic of Kazakhstan, confidential according to the legislation, on the state secrets.

3. The procedure for information access in the field of subsurface use is determined by this Code and other laws of the Republic of Kazakhstan.

4. Interested persons have the right to use gratuitously open information, access to which is provided according to this Article.

Article 8. Subsurface use paid nature

Subsurface use is paid (paid). The payment for use of natural resources is performed by means of tax payment and other obligatory payments in the budget according to the tax legislation of the Republic of Kazakhstan.

Article 9. Conscientiousness of subsoil users

In the course of implementation of the state control of transactions on subsurface use in case of realization by subsoil users of the rights granted to them and accomplishment of the obligations provided by this Code conscientiousness of actions of subsoil users is supposed.

Chapter 2. General provisions about subsoil and their resources

Article 10. Subsoil and their resources

1. Subsoil the part of crust located below soil layer is recognized, and in case of its absence - below the land surface, bottom of reservoirs and water currents.

2. This Code regulates use of natural resources concerning the following resources:

1) minerals;

2) technogenic mineral educations;

3) space of subsoil.

Article 11. Property on subsoil

1. According to the Constitution of the Republic of Kazakhstan subsoil is in state-owned property.

2. The state provides subsoil in use on the bases, conditions and in the limits provided by this Code.

3. The actions of physical persons and legal entities violating the right of state-owned property to subsoil attract the responsibility provided by the laws of the Republic of Kazakhstan. The bargains concluded in defiance of state-owned property on subsoil are insignificant.

Article 12. Minerals and their classification

1. Minerals the natural mineral educations and organic substances containing useful components which chemical composition and physical properties allow to use them in the field of production of goods and consumption directly or after conversion are recognized.

2. On the economic value and for the purpose of establishment of the corresponding conditions of subsurface use minerals are subdivided into the following groups:

1) underground waters;

2) hydrocarbon minerals (hydrocarbons);

3) solid minerals.

3. Hydrocarbons oil, sour gas and natural bitumen are recognized. Oil crude oil, gas condensate, and also the hydrocarbons received after purification of crude oil and processing of combustible slates, petrobituminous rocks or resinous sands are recognized.

Crude oil any hydrocarbons regardless of their specific weight extracted from subsoil in liquid state at normal atmospheric temperature and pressure, including formed of sour gas by natural condensation are recognized.

Sour gas any hydrocarbons regardless of their specific weight extracted from subsoil in gaseous state at normal atmospheric temperature and pressure, including crude natural, associated, slate gas, methane of coal layers, and also not hydrocarbon gases which are in their structure are recognized.

Associated gas the multi-component mixture of hydrocarbons and not hydrocarbon gases which is as a part of oil in dissolved condition in bedded conditions and emitted from it in case of pressure decrease is recognized.

Methane of coal layers the multi-component mixture of hydrocarbons and not hydrocarbon gases with the prevailing methane content which is in gaseous state at normal atmospheric temperature and pressure, extracted from coalfields is recognized.

Natural bitumen the minerals of organic origin with primary hydrocarbon basis lying in subsoil in firm, viscous and viscoplastic conditions which production under natural conditions by borehole methods is technically impossible are recognized.

4. Solid minerals the natural mineral educations, organic substances and their mixes which are in firm condition in subsoil or on the land surface are recognized.

Solid minerals are subdivided on ore and nonmetallic. Ore solid minerals native metals, ores of ferrous, non-ferrous, rare, radioactive metals and rare-earth elements are recognized. Other solid minerals are recognized nonmetallic.

The nonmetallic solid minerals used in natural state or with insignificant processing and cleaning in construction and other economic purposes and having wide circulation in subsoil are recognized popular. Treat popular minerals:

the metamorphic breeds including including, marble, quartzites, quartz полевошпатовые breeds;

the magmatic rocks including including, granites, syenites, diorites, gabbro, rhyolites (liparit), andesites, diabases, basalts, volcanic tufa, slags, pumice, volcanic glasses and vitreous breeds (perlites, obsidian);

the sedimentary rocks including including, pebbles and gravel, gravel and sand (sand-gravel) mix, sands and sandstones, clays and clay breeds (loams, aleurolites, soapstones, clay slates), table salt, plaster breeds, marl, limestones, including shell rocks, cretaceous breeds, dolomite, calcareous and dolomitic breeds, siliceous breeds (bergmeals, molding, diatomites), natural pigments, peat, therapeutic muds.

Article 13. Technogenic mineral educations, rights to technogenic mineral educations

1. Technogenic mineral educations accumulations of waste mining, the mountain overworking and energy productions containing useful components and (or) minerals are recognized.

The waste of production of solid minerals formed as a result of release of solid minerals of mountain weight in the course of their extraction from subsoil belongs to technogenic mineral formations of mining productions (vskrysh, the containing breed, dust, poor (substandard) ore).

The conversion waste formed as a result of activities of mining and processing productions (tails and slimes of enrichment) and (or) chemical and metallurgical productions (slags, kek, clinkers and other similar types of waste of metallurgical conversion) belongs to technogenic mineral formations of mountain processing industries.

The solid waste which is formed as a result of combustion of fuel in case of production of electrical and (or) heat energy the generating installations belongs to technogenic mineral formations of energy productions (ashes and zoloshlaka).

2. The technogenic mineral educations located within the subsoil plot are accessory of such site.

The technogenic mineral educations which resulted from activities of the chemical and metallurgical or energy productions located outside the subsoil plot which is in use are accessory of the specified productions. The property right to such technogenic mineral educations remains for the owner of productions until closing of polygon (part of polygon) of placement of these technogenic mineral educations according to the ecological legislation of the Republic of Kazakhstan.

3. The property right to the technogenic mineral educations which resulted from activities of the subsoil user on the subsoil plot which is in use at this subsoil user remains behind it on subsurface use right effective period.

The subsoil users who are owners of the technogenic mineral educations having the right to own, use and dispose taking into account provisions of this Article of the technogenic mineral educations which resulted from activities on the subsoil plot provided to them in use and also to alienate them to the third parties.

Alienation of the specified technogenic mineral educations to the third parties without withdrawal from the subsoil plot or polygon of their placement is not allowed, except cases of transition of the right of subsurface use or, respectively, the property right to productions, stipulated in Item 2 these Articles.

In case of alienation to the third parties of the technogenic mineral educations located on the subsoil plot which is in use, their withdrawal shall be performed during action of the right of subsurface use.

4. Placement of technogenic mineral formations of mining productions is performed only within the subsoil plots which are in use according to the license for investigation of solid minerals, the license for production of solid minerals, the license for production of popular minerals or the license to use of space of subsoil.

Placement of technogenic mineral formations of mining and processing productions is performed only within the subsoil plots which are in use according to the license for production of solid minerals or the license to use of space of subsoil.

For the purpose of ensuring efficiency of use of resource potential of technogenic mineral educations their placement on one object as a result of activities of different productions (mining, mining and processing, chemical and metallurgical productions) is forbidden if such technogenic mineral educations have no homogeneous physical and chemical properties and such placement does not conform to requirements of the ecological legislation of the Republic of Kazakhstan.

5. The technogenic mineral educations left on the subsoil plot after the termination of the right of subsurface use or, respectively, after closing of polygon (part of polygon), are included subsoil.

For the purposes of of this Code the legal regime of solid minerals is applied to the technogenic mineral educations included in structure of subsoil.

Article 14. Fields and their classification

1. The field natural or technogenic accumulation of mineral (minerals) which according to the quantity, quality and mining characteristics can be suitable for industrial development with positive economic effect is recognized.

2. In size of resources or inventories of minerals and their economic importance in separate category large-scale deposits are allocated.

3. The fields of solid minerals containing the following resources are recognized large:

Mineral, unit of measure

Quantity

Iron ores, one million t

> 100

Manganese ores, one million t

> 50

Chromite ores, one million t

> 30

Copper, one million t

> 5

Lead, one million t

> 5

Zinc, one million t

> 5

Bauxites, one million t

> 50

Nickel of thousand tons

> 50

Tungsten, thousand tons

> 100

Molybdenum, thousand tons

> 200

Gold, t

> 250

The coal which is coked one million t

> 50

Steam coal, one million t

> 500

Coal brown, one million t

> 500

Combustible slates, one million t

> 500

Phosphorites (ore), one million t

> 200

The sulphuric acid, mixed potassium salts, one million t

> 100

 

The fields of hydrocarbons containing the following geological inventories are recognized large:

 

Mineral, unit of measure

Quantity

Oil, one million t

> 100

Natural gas, one billion m3

> 50

Article 15. Property on the extracted minerals

The extracted minerals belong to the subsoil user on the property right (to the state legal entity - on the right of economic maintaining or the right of operational management) if other is not established by this Code.

Article 16. Space of subsoil

Space of subsoil is three-dimensional space property of subsoil which taking into account geotechnical, geological, economic and ecological factors can be used as environment for placement of objects of productive, scientific or other activity.

Section II. Use of natural resources

Chapter 3. General provisions about the subsurface use right

Article 17. Concept and content of the right of subsurface use

1. The right of subsurface use represents the opportunity provided with this Code on paid basis to use subsoil within the allocated site in the entrepreneurial purposes during certain term.

2. The mineral right is the corporeal indivisible right. Taking into account provisions of this Code regulations about the property right as it does not contradict the nature of the corporeal right are applied to the right of subsurface use.

3. Use of natural resources is performed according to the procedure, on conditions and in the limits set by this Code.

Article 18. Persons of law of subsurface use

1. Physical persons and legal entities if other is not provided by this Code can be persons of law of subsurface use.

2. Several persons can be owners of the right of subsurface use at the same time. In this case ownership of the right of subsurface use is general. General ownership of the right of subsurface use arises in case of provision of the right of subsurface use to two and more persons at the same time or as a result of transition of share in the subsurface use right from one person to other person.

General ownership of the right of subsurface use by two and more persons is allowed only with determination of share of each of these persons in such right.

The regulations of the civil legislation of the Republic of Kazakhstan governing the relations of common ownership are applied to general ownership of the right of subsurface use.

In the cases provided by this Code, only one person can be the owner of the right of subsurface use.

3. If other is not provided by this Code, the subsurface use right (share in the subsurface use right) can pass from one person to another on the bases provided by the civil legislation of the Republic of Kazakhstan.

Article 19. Subsoil plot as subsurface use right object

1. The subsoil plot the geometrizovanny part of subsoil with certain space borders provided in use according to this Code is recognized.

Space borders of the subsoil plot are formed by the conditional planes proceeding from straight lines between points with the geographical coordinates creating the closed contours (borders) on the land surface (the subsoil plot territory) and depth creating the upper and lower space bounds.

The upper space bound of the subsoil plot is located below soil layer, and in case of its absence - below the land surface and (or) bottom of reservoirs, water currents. The lower space bound of the subsoil plot is located at depths available to geological studying and development.

In the cases provided by this Code, the upper and (or) lower space bounds of the subsoil plot can be located at other depth.

2. For the purpose of identification of the territory of the subsoil plot for carrying out transactions on investigation of minerals (the site of investigation) and transactions on geological studying (the site of geological studying) the territory of the Republic of Kazakhstan is conditionally divided into blocks which each party is equal to one minute in geographical system of coordinates. Twenty five blocks form subsection of blocks which each party is equal to five minutes in geographical system of coordinates. Hundred blocks form section of blocks which each party is equal to ten minutes in geographical system of coordinates.

Each block, subsection and section of blocks have the coordinates identifying them and individual codes assigned by authorized body on studying of subsoil. The territory of the site of investigation (the investigation territory) or the site of geological studying (the territory of geological studying) can consist of one or more blocks. If the specified territory consists of two and more blocks, each block of this territory shall have the general party at least with one other its block.

In the cases provided by this Code, the territory of investigation or geological studying can include part of the block (the incomplete block). If the specified territory consists of two and more incomplete blocks, each such block shall have the general party at least with one other complete or incomplete block of this territory.

3. External borders of the territory of the subsoil plot for carrying out transactions on mining (the site of production), on prospecting (the site of prospecting) and use of space of subsoil (the site of use of space of subsoil) shall form rectangle. If natural features or borders of other subsoil plot do not allow to determine external borders of the territory of the respective site of production, the site of prospecting or the site of use of space of subsoil in the form of rectangle, the territory of such subsoil plot can have the quadrangle form, at least two counter parties of which shall be parallel each other.

In the cases provided by this Code, the territory of the site of production can have the polygon form.

Article 20. Bases of origin and acquisition of right of subsurface use

1. The right of subsurface use arises on the basis:

1) licenses for subsurface use;

2) contract for subsurface use.

2. The right of subsurface use is acquired in cases:

1) provisions of the right of subsurface use;

2) transition of the right of subsurface use (share in the subsurface use right) based on civil transactions;

3) transition of the right of subsurface use according to the procedure of legal succession by reorganization of the legal entity, except for transformations or inheritances.

Article 21. Bases of the termination of the right of subsurface use

1. Nobody can be deprived of the subsurface use right differently as on the bases established by this Code and other laws of the Republic of Kazakhstan.

2. The right of subsurface use stops with cancellation of the license or contract for subsurface use.

Article 22. Transaction types on subsurface use

The right of subsurface use is granted for implementation of the following transactions:

1) geological studying of subsoil;

2) investigation of minerals;

3) mining;

4) use of space of subsoil;

5) prospecting.

Article 23. Project documents for carrying out transactions on subsurface use

1. In the cases provided by this Code, operations on subsurface use can be performed only in the presence of the project document providing carrying out such transactions.

2. The documents containing plans, methods, technique, specifications, technological indicators, amount, terms and other parameters of the works which are carried out for the purpose of subsurface use are project.

3. Project documents are developed separately for each subsoil plot for the term of its use, provided by the license or the contract.

4. Project documents are developed taking into account requirements of ecological and industrial safety. When carrying out transactions on subsurface use subsoil users shall observe the parameters of ecological and industrial safety provided in the project document.

5. Features of development of project documents taking into account transaction types on subsurface use are established by provisions of the Special part of this Code.

Article 24. Carrying out transactions on subsurface use in one territory different persons

1. Different subsoil users can perform operations on subsurface use in the same territory (the combined territory) if other is not provided by provisions of the Special part of this Code.

2. The procedure for carrying out transactions by subsoil users in the combined territory is determined by the agreement between them. The agreement determines conditions and procedure for carrying out all or separate work types in the combined territory.

The agreement is signed in simple written form and it is represented the subsoil user in the state body which granted the subsurface use right, in time no later than five working days from the date of its conclusion.

The agreement can provide reasonable and proportional compensation for the costs suffered by one of subsoil users.

3. In case of not achievement by subsoil users of the agreement on procedure for carrying out transactions in the combined territory the priority of one subsoil user before another under the authority of works in the combined territory is established. In this case the subsoil user having priority under the authority of works in the combined territory is the subsoil user:

1) performing operations on mining;

2) having the subsurface use right granted earlier if both subsoil users perform operations on mining;

3) having the subsurface use right granted earlier if both subsoil users perform operations on investigation of minerals;

4) performing operations on use of space of subsoil if other subsoil user performs operations on investigation of minerals.

4. The subsoil user who does not have priority under the authority of works in the combined territory shall consider time, duration, the place, amount and nature of the works which are carried out or planned by the subsoil user having such priority and not to create obstacles for their carrying out. The subsoil user shall use the priority honesty and reasonably, without pursuing the aims of receipt of unreasonable benefits.

5. The subsoil user having priority under the authority of works in the combined territory shall provide in writing to the subsoil user who does not have priority, information on duration, the place, amount and nature of the works which are carried out and planned to carrying out on the general subsoil plot, in a month from the date of receipt of the written request of the last. Such information can be trade secret.

Time, duration, amount, the place and nature of works, information on which is provided to the subsoil user who does not have priority under the authority of works in the combined territory, can be changed by the subsoil user having such priority, is not more often than once within three months. In this case the subsoil user having priority shall notify in writing other subsoil user on change of time, duration, amount, the place and nature of planned activities not later than one month before such changes. The subsoil user who does not have priority under the authority of works in the combined territory having the right to complete the works begun before receipt of such notification.

Article 25. The territories limited for carrying out transactions on subsurface use

1. If other is not provided by this Article, carrying out transactions on subsurface use is forbidden:

1) in the territory of lands for needs of defense and homeland security;

2) in the territory of lands of settlements and the territories adjoining to them at distance of one thousand meters;

3) in the territory of the parcel of land occupied with the operating hydraulic engineering construction not being subject to placement of technogenic mineral formations of mining and processing productions and the territory adjoining to it at distance of four hundred meters;

4) in the territory of lands of water fund;

5) in contours of fields and sites of underground waters which are used or can be used for drinking water supply;

6) at distance of hundred meters from burial grounds, graves and cemeteries, and also from the parcels of land which are taken away under burial grounds and cemeteries;

7) in the territory of the parcels of land belonging to the third parties and occupied with buildings and constructions, long-term plantings, and adjoining to them the territories at distance of hundred meters - without the consent of such persons;

8) in the territory of the lands occupied automobile and the railroads, the airports, airfields, objects of air navigation and the aerotechnical centers, objects of rail transport, bridges, the subways, tunnels, objects of power systems and power lines, the communication lines, objects providing space activities, bulk distribution lines;

9) in the territories of the subsoil plots allocated to the state legal entities for the state needs;

10) in other territories in which carrying out transactions on subsurface use according to other laws of the Republic of Kazakhstan is forbidden.

2. Provision in use of the subsoil plot which external territorial borders are completely located within the territories specified in Item 1 of this Article is forbidden.

3. The prohibition established by the subitem 2) of Item 1 of this Article does not extend:

1) on carrying out transactions on investigation of solid minerals or transactions on production of the solid minerals by underground method approved with local executive and representative bodies by the agreement signature providing social and economic support of the local population living in the corresponding territory. In this case availability of this agreement is condition for issue of the corresponding license;

2) on carrying out transactions on subsurface use in the territory of the former Semipalatinsk test nuclear test site;

3) on carrying out transactions on geological studying of subsoil regarding search and estimative works on underground waters.

The prohibition established by the subitem 4) of Item 1 of this Article does not extend to prospecting and transactions on investigation or hydrocarbon production.

Prohibitions, stipulated in Item 1 this Article, do not extend to the operations on subsurface use performed by means of aero geophysical surveys or researches with use of space methods of remote sensing of Earth.

Article 26. Carrying out transactions on subsurface use in especially protected natural territories and subsoil plots representing special ecological, scientific, historical and cultural and recreational value

1. Restrictions on carrying out transactions on subsurface use in especially protected natural territories and within the subsoil plots representing special ecological, scientific, historical and cultural and recreational value are established by the legislation of the Republic of Kazakhstan in the field of especially protected natural territories.

2. In case of detection of the geological, geomorphological and hydrogeological objects representing according to the legislation of the Republic of Kazakhstan in the field of especially protected natural territories special ecological, scientific, historical and cultural and recreational value, subsoil users shall stop without delay works on the respective site and in writing notify on it authorized body on studying of subsoil and authorized body in the field of environmental protection.

Article 27. Conditions of building of the territories of bedding of minerals

1. Designing and construction of settlements, industrial complexes and (or) other economic objects are allowed only after receipt of the positive conclusion of local executive body of area, the city of republican value, the capital in coordination with territorial subdivision of authorized body on studying of subsoil about absence or insignificance of minerals in subsoil under the site of the forthcoming building.

2. Building of the territories of bedding of minerals is allowed with the permission of local executive body of area, the city of the republican value, the capital issued in coordination with territorial subdivision of authorized body on studying of subsoil on condition of possibility of extraction of minerals or validity of economic feasibility of building.

3. The approval procedure on building of the territories of bedding of minerals is determined by authorized body by studying of subsoil.

Article 28. Ensuring support of the Kazakhstan personnel, producers of goods, suppliers of works and services when carrying out transactions in investigation and (or) mining

1. When carrying out transactions on investigation and (or) mining subsoil users shall give preference to the Kazakhstan personnel. Attraction of foreign labor power is performed according to the legislation of the Republic of Kazakhstan on employment of the population and population shift.

At the same time the number of the heads, managers and specialists performing labor activity in the territory of the Republic of Kazakhstan within internal transfer according to the legislation of the Republic of Kazakhstan on employment of the population and population shift shall be no more than fifty percent from the total number of heads, managers and each corresponding category specialists.

Calculation of share of local content in personnel is perfromed according to the technique approved by authorized body concerning employment.

2. The share of local content in the works and services acquired for carrying out transactions on subsurface use, established in the conditions of contracts for subsurface use, licenses for production of solid minerals shall constitute at least fifty percent from the total amount of the acquired works and services within calendar year.

Calculation of share of local content in goods, works and services is performed by the organizations according to single method of calculation of local content when purchasing goods, works and services approved by authorized body in the field of the state support of industrial activities.

Chapter 4. Subsurface use right modes

Paragraph 1. Licensed mode of subsurface use
Article 29. Concept of the license for subsurface use

1. The license for subsurface use is the document issued by state body and granting to its owner the right to use of the subsoil plot for the purpose of carrying out transactions on subsurface use within the subsoil plot specified in it.

The license for subsurface use does not belong to the permissions regulated according to the legislation of the Republic of Kazakhstan on permissions and notifications.

2. The license for subsurface use is granted for use only of one subsoil plot.

3. The any number of the licenses for subsurface use, except as specified, established by this Code can be issued to one person.

4. The license is granted according to the statement of the interested person. The application form on licensing affirms competent authority.

5. The granted license is subject for publication on Internet resource of the state body which granted the license in day of issue.

6. The state body performing issue of licenses for subsurface use keeps the register of the granted licenses.

In addition to the data containing in the license, the specified register contains data:

1) about the residence of the physical person who is the subsoil user;

2) about the registered encumbrances concerning the subsurface use right;

3) other data which are necessary for the accounting purposes.

The procedure for maintaining the register of the granted licenses is established by competent authority.

Article 30. License types on subsurface use

Taking into account transaction type on subsurface use the following licenses for subsurface use are granted:

1) license for geological studying of subsoil;

2) license for investigation of solid minerals;

3) license for production of solid minerals;

4) license for production of popular minerals;

5) license to use of space of subsoil;

6) license for prospecting.

Article 31. Contents of the license for subsurface use

1. The license for subsurface use is drawn up in the form approved by competent authority.

2. In the license for subsurface use taking into account its type are specified:

1) license type on subsurface use;

2) the name of the state body which granted the license;

3) the information about person to which the license is granted:

for physical persons - surname, name, middle name (if it is specified in the identity document) and nationality;

for legal entities - the name, the location;

4) number and date of the license;

5) license conditions: the term of the license, border of the territory of the subsoil plot and other conditions of subsurface use provided by this Code.

3. The term of the license is estimated from the date of, specified in the license.

4. If two and more persons own the right of subsurface use, the license shall contain specifying on the size of shares of persons which are general owners of the right of subsurface use.

5. The license is drawn up in the Kazakh and Russian languages.

6. Conditions of the license for subsurface use shall conform to the requirements established by this Code.

7. If after licensing for subsurface use the legislation of the Republic of Kazakhstan governing the relations in the field of subsurface use establishes other conditions of the license for subsurface use, these conditions to earlier granted license are not applied.

The provision established by part one of this Item does not extend to changes of the legislation of the Republic of Kazakhstan in the field of ensuring national security, defense capability, ecological safety, health care, the taxation, customs regulation and protection of the competition.

8. If the license for subsurface use is granted with violation of content of its conditions, the regulations of this Code on contents of the license for subsurface use operating in day of licensing are applied.

Article 32. Modification of the license for subsurface use

1. Changes in the license for subsurface use are made by the state body which granted the license by its renewal.

The renewed license is subject for publication on Internet resource of the state body which granted the license in day of renewal.

2. The license is subject to renewal in cases:

1) changes of information about the subsoil user:

for physical persons - changes of surname, name, middle name (if it is specified in the identity document) and (or) nationality;

for legal entities - change of the name or the location;

2) transition of the right of subsurface use and (or) share in the subsurface use right;

3) prolongation of term of the license;

4) changes of borders of the territory of the subsoil plot.

3. Renewal of the license is made according to the application of the subsoil user submitted in the form approved by competent authority.

Originals or notarially attested copies of the documents confirming the data specified in it are enclosed to the application.

The statement and documents attached to it shall be constituted in the Kazakh and Russian languages. If the application is submitted by the foreigner or the foreign legal entity, the documents attached to it can be constituted in other language with the annex to each document of transfer into the Kazakh and Russian languages which fidelity is certified by the notary.

4. The state body which granted the license refuses renewal of the license in case of discrepancy of the statement to requirements of this Code.

5. The state body which granted the license makes its renewal or notifies on refusal in such renewal within seven working days from the date of receipt of the statement.

6. The refusal in renewal of the license can be appealed by the subsoil user according to the legislation of the Republic of Kazakhstan within ten working days from the date of receipt of the notification on refusal.

7. Renewal of the license in the cases provided by subitems 2), 3), 4) of Item 2 of this Article is performed according to this Code.

8. The grammatical or arithmetic mistakes, typographical errors or other similar mistakes made in case of issue or renewal of the license are subject to correction by the state body which granted the license.

Error correction, allowed in case of issue or renewal of the license, is not renewal of the license.

Error correction can be made at the initiative of the state body which granted the license or according to the statement of the subsoil user.

The state body makes error correction according to the statement of the subsoil user within five working days from the date of receipt of such statement.

The state body which granted the license after correction gives error messages in the license it to the subsoil user within two working days.

The corrected license is subject for publication on Internet resource of the state body which granted the license in day of correction.

The disputes which arose in connection with error correction in the license are subject to permission according to the legislation of the Republic of Kazakhstan.

Article 33. Cancellation of the license for subsurface use

The license for subsurface use is terminated in cases:

1) the expirations on which it was issued if other is not provided by this Code;

2) the death of its single owner (including announcements his dead), if the subsurface use right which arose based on the license according to the civil legislation of the Republic of Kazakhstan acknowledged heirless property;

3) revocation of license or recognition of its invalid;

4) refusal of the subsoil user of the subsoil plot on which the license was granted.

Article 34. Invalidity of the license and effect of its invalidity

1. The license can be acknowledged invalid judicially in the following cases:

1) in case of provision factual determination to the state body which granted the license, obviously unreliable information which influenced its decision to grant the license;

2) violations of the licensing procedure established by this Code that led to unreasoned decision of state body about licensing, owing to the fact of the malicious agreement between the official of state body determined by court and the applicant;

3) licensing to person recognized incapacitated and being that in day of issue;

4) if licensing is not provided or prohibited by this Code.

2. The interested person and the prosecutor, and on the bases provided by subitems 1) and 3) of Item 1 of this Article - also state body which granted the license have rights to appeal to the court with the claim for recognition of the invalid license.

Face, the right to the license and which legitimate interests are violated is interested or can be broken as a result of licensing.

3. The license is recognized invalid from the date of judgment entry into force.

4. In case of recognition of the invalid license on the bases provided by subitems 1) and 2) of Item 1 of this Article, person who obtained the license shall indemnify to the state the caused loss in the amount of income gained by such person from illegal use of the subsoil plot, and the expenses of the state connected with recognition of the invalid license.

5. Person has no right to require recognition of the invalid license which is granted with violation of requirements of this Code, other laws of the Republic of Kazakhstan, the charter of the legal entity if such requirement is caused by mercenary motives or intention to avoid the responsibility.

6. Limitation period on the disputes connected with invalidity of the license makes three months from the date of when the claimant learned or shall learn about the circumstances which are the basis for recognition of the invalid license.

Paragraph 2. Contractual mode of subsurface use
Article 35. Concept of the contract for subsurface use

1. The contract for subsurface use is the agreement, content, procedure for the conclusion which execution and the terminations are determined by this Code.

2. Under the contract for subsurface use one party (The Republic of Kazakhstan on behalf of competent authority) shall provide for certain term to other party (subsoil user) the subsurface use right, and the subsoil user shall at own expense and on the risk to perform subsurface use in accordance with the terms of the contract and this Code.

3. The contract for subsurface use is signed for exploration and production or hydrocarbon production, and also for uranium production.

4. In case of the conclusion of the contract in use only one subsoil plot is provided.

Several subsoil plots can be fixed in the cases and procedure established by the Special part of this Code in the contract for exploration and production of hydrocarbons by means of modification and amendments.

5. The same person can conclude any number of the contracts for subsurface use, except as specified, established by this Code.

6. The competent authority keeps the register of the signed contracts. The procedure for maintaining the register of the signed contracts is established by competent authority.

Article 36. Contents of the contract for subsurface use

1. Drafts contract on subsurface use are developed according to the standard contracts approved by competent authority. The variation from the standard contract is allowed in the cases, limits and procedure provided by this Code.

2. Treat number of the compulsory provisions containing in the contract for subsurface use:

1) transaction type on subsurface use;

2) duration of the contract;

3) borders of the site (sites) of subsoil;

4) obligations of the subsoil user on amounts and work types on the subsoil plot during investigation, (extra works) provided by the work program;

5) obligations of the subsoil user on financing of training of the Kazakhstan personnel during production;

6) obligations of the subsoil user on the minimum share of local content in personnel;

7) obligations of the subsoil user on the share of local content in works and services conforming to requirements of this Code including in work types and the services included in the list of priority works and services approved by authorized body in the field of hydrocarbons;

8) obligations of the subsoil user on mitigation of consequences of subsurface use;

9) obligations of the subsoil user on expenses on research, scientific and technical and developmental works in the territory of the Republic of Kazakhstan during production;

10) obligations of the subsoil user on expenses on social and economic development of the region and development of its infrastructure during production;

11) obligations of the subsoil user on observance by it and his contractors of procedure for purchase of goods, the works and services used when carrying out transactions on investigation or hydrocarbon production and production of the uranium determined by authorized bodies in the field of hydrocarbons and production of uranium;

12) responsibility of the subsoil user for violation of contract commitments, including violation of indicators of basic project documents on exploration and production of the hydrocarbons carried by this Code to contract commitments and also for violation of the obligation on observance by the subsoil user and (or) his contractors of established procedure of purchase of goods, works and services when carrying out transactions in investigation or hydrocarbon production and production of uranium;

13) other conditions on which the subsurface use right was granted.

3. In case of the conclusion of the contract for the subsoil plot according to which the contract for subsurface use was stopped earlier and the trust management agreement is signed with the national company in the field of hydrocarbons, the signed contract shall contain obligations of the new subsoil user:

1) by the size and terms of compensation to the former subsoil user of cost of this Code of property transferred according to Item 19 of article 119;

2) by the size and terms of compensation to the trustee of the costs made according to the trust management agreement, and also payments of remuneration to it, except as specified, provided by this Code.

4. The duration of the contract on exploration and production of hydrocarbons is determined consistently enshrined in it by the investigation period, the preparatory period (if necessary) and the production period.

The duration of the contract on hydrocarbon production is determined consistently enshrined in it by the preparatory period and the period of production.

The duration of the contract on production of uranium is determined consistently fixed in it by the period of trial production and the period of production.

5. The duration of the contract on exploration and production or the contract for production is prolonged by competent authority for effective period of force majeure circumstances if the subsoil user produces the evidence of such circumstances according to the legislation of the Republic of Kazakhstan.

6. The contract is signed in the Kazakh and Russian languages. By agreement of the parties the contract the text of the contract can be also translated into other language.

7. Changes and amendments in the legislation of the Republic of Kazakhstan worsening results of business activity of the subsoil user on contracts for subsurface use are not applied to the contracts signed before introduction of such changes and amendments.

The guarantees established by part one of this Item do not extend to changes in the legislation of the Republic of Kazakhstan in the field of ensuring national security, defense capability, ecological safety, health care, the taxation, customs regulation and protection of the competition.

8. Applicable law under contracts for subsurface use is the right of the Republic of Kazakhstan.

Article 37. Modification and amendments in the contract for subsurface use

1. Modification and amendments in the contract for subsurface use is made by the conclusion by the parties of the supplement to contract.

2. The supplement to contract consists in cases:

1) changes of information about the subsoil user:

for physical persons - surname, name, middle name (if it is specified in the identity document), nationality;

for legal entities - the name, the location;

2) changes of data on competent authority;

3) transition of the right of subsurface use and (or) share in the subsurface use right;

4) fixing of the site (sites) of production and preparatory period (preparatory periods);

5) fixing of the site (sites) and period (periods) of production or period (periods) of production;

6) prolongation of the period (periods) of investigation or production;

7) increase or reduction of the site (sites) of subsoil;

8) allocations of the site (sites) of subsoil;

9) concerning strategic subsoil plots - the change of economic interests of the Republic of Kazakhstan creating threat of homeland security.

3. The conclusion of the supplement to contract in the case provided by the subitem 1) of Item 2 of this Article is made according to the statement of the subsoil user which shall contain:

1) surname, name, middle name (if it is specified in the identity document), the name of the subsoil user;

2) number and registration date of the contract for subsurface use;

3) specifying on the changeable information about the subsoil user.

4. Are in addition enclosed to the application:

1) the documents confirming need of modification of information about the subsoil user;

2) the supplement to contract signed by the subsoil user providing modification of information about the subsoil user.

5. The statement is subject to consideration within twenty working days from the date of its receipt in competent authority. By results of consideration of the application the competent authority concludes the supplement to contract with the applicant and sends to the applicant its signed copy or refuses the conclusion of amendment.

6. The competent authority refuses the conclusion of amendment if the statement does not conform to the requirements established by this Code.

The refusal of competent authority in the conclusion of amendment does not deprive of the subsoil user of the right to submission of the repeated statement.

7. The conclusion of the supplement to contract in the case provided by the subitem 2) of Item 2 of this Article is made at the initiative of competent authority.

8. The conclusion of the supplement to contract in the cases provided by subitems 3) - 9) Item 2 of this Article, is performed according to this Code.

Article 38. Cancellation of the contract for subsurface use

1. The contract on subsurface use is withdrawn in cases:

1) the expirations on which he was imprisoned including if:

before the end of the period of investigation the supplement to contract providing fixing of the preparatory period or period of production was not concluded;

before the end of the preparatory period the supplement to contract providing fixing of the period of production was not concluded;

2) the death of person who is the single owner of the right of subsurface use under the contract (including announcements his dead), if such right of subsurface use according to the civil legislation of the Republic of Kazakhstan acknowledged heirless property;

3) liquidations of the legal entity who is the subsoil user;

4) early termination of operation of the contract or recognition by its invalid;

5) contract cancelation by agreement of the parties;

6) acceptances by the Government of the Republic of Kazakhstan decisions on prohibition of use of the subsoil plot according to this Code;

7) refusal (return) of the subsoil user (subsoil user) of all site (all sites) of subsoil on which, (which) signed the contract.

2. The competent authority has the right to withdraw ahead of schedule the contract on subsurface use on the bases provided by this Code.

Article 39. Invalidity of the contract for subsurface use and effect of its invalidity

1. The bases for recognition of the contract for subsurface use invalid are:

1) recognition of auction on provision of the right of subsurface use by invalid;

2) absence in the contract for subsurface use of the compulsory provisions established by this Code;

3) provision factual determination to competent authority of obviously unreliable information which influenced its decision to sign the contract for subsurface use with this person;

4) other bases provided by the laws of the Republic of Kazakhstan.

2. The contract for subsurface use nullified does not attract consequence in law, except for those which are connected with its invalidity, and is invalid from the date of its conclusion.

Recognition of the contract invalid does not exempt the subsoil user from obligation fulfillment on mitigation of consequences of subsurface use.

3. Recognition invalid judicially or agreement cancelation on the basis of which transfer and renewal of the right of subsurface use was performed attracts invalidity of the changes and additions in the contract for subsurface use made in connection with such transfer of the right of subsurface use, but not the contract.

4. Recognition of the contract for subsurface use attracts with invalid invalidity of all subsequent transactions which subject is the subsurface use right granted based on such contract.

Chapter 5. Transition of the right of subsurface use and the objects connected with the subsurface use right

Article 40. Transition of the right of subsurface use

1. Transition of the right of subsurface use (share in the subsurface use right) is performed in case of alienation of the right of subsurface use (share in the subsurface use right) to other person based on civil transactions or in other cases provided by the laws of the Republic of Kazakhstan.

2. Transition of the right of subsurface use (share in the subsurface use right) is forbidden:

1) according to the license for investigation of solid minerals in the first year of its action;

2) according to the license for geological studying of subsoil;

3) according to the license for prospecting.

3. Transition of the right of subsurface use (share in the subsurface use right) is made by renewal of the license for subsurface use or, respectively, modification of the contract for subsurface use.

For renewal of the license for subsurface use or modification of the contract for subsurface use the owner of the right of subsurface use (share in the subsurface use right) and the acquirer of the right of subsurface use (share in the subsurface use right) file the joint statement in the state body which granted the license for subsurface use or signed the contract for subsurface use.

Are enclosed to the application:

1) the original document based on which the subsurface use right is acquired;

2) the documents confirming the information about the acquirer of the right of subsurface use:

for physical persons - surname, name and middle name (if it is specified in the identity document) the applicant, the residence, nationality, data on identity documents of the applicant;

for legal entities - the name of the applicant, its location, data on state registration as the legal entity (the statement from the trade register or other legalized document certifying that the applicant is legal entity by the legislation of foreign state), the information about legal entities which shares are traded on the organized market of securities, the states, the international organizations and physical persons directly or indirectly controlling the acquirer;

3) the documents confirming compliance of the acquirer to requirements of this Code imposed to persons applying for receipt of the right of subsurface use (share in the subsurface use right) under the contract for exploration and production or hydrocarbon production or production of uranium;

4) written consent of the pawnbroker if the subsurface use right (share in the subsurface use right) is encumbered it (is encumbered) with pledge;

5) written consent of all joint owners of the right of subsurface use.

In case of modification and amendment of the contract for subsurface use the draft of the supplement to contract signed by the applicant on subsurface use is enclosed to the application.

In case of acquisition of right of subsurface use on the permission issued according to Article 44 of this Code instead of the documents confirming the information about the acquirer, the acquirer has the right to enclose to the application the written confirmation that the information about him did not change in comparison with the data provided to them for receipt of the specified permission.

The statement and documents attached to it shall be constituted in the Kazakh and Russian languages. If the application is submitted by the foreigner or the foreign legal entity, the documents attached to it can be constituted in other language with the annex to each document of transfer into the Kazakh and Russian languages which fidelity is certified by the notary.

The state body makes renewal of the license or concludes the supplement to contract with the acquirer of the right of subsurface use or gives motivated refusal in renewal or the conclusion of the supplement to contract within seven working days from the date of receipt of the statement.

4. The state body refuses renewal of the license or introduction of amendments to the contract in cases:

1) discrepancies of the statement to requirements of Item 3 of this Article;

2) discrepancies of conditions of transition of the right of subsurface use to the issued permission if such transition is performed according to such permission;

3) lack of permission to transition of the right of subsurface use when such permission was required according to this Code;

4) if transition of the right of subsurface use (share in the subsurface use right) is performed on the subsoil plot on which the subsoil user is forbidden to perform operations on subsurface use or separate work types according to the imposed administrative punishment;

5) if transition of the right of subsurface use (share in the subsurface use right) is prohibited by this Code;

6) if transition of the right of subsurface use (share in the subsurface use right) entails violation of provisions of the international treaties signed by the Republic of Kazakhstan.

The refusal in renewal of the license or introduction of amendments to the contract can be appealed by the acquirer of the right of subsurface use according to the legislation of the Republic of Kazakhstan within ten working days from the date of receipt of the notification on refusal.

The refusal in renewal of the license or introduction of amendments to the contract on the subitem bases 1) of part one of this Item does not deprive of the acquirer of the right of subsurface use to the repeated address with the statement on renewal of the license or introduction of amendments to the contract.

The refusal in renewal of the license or introduction of amendments to the contract on the bases of subitems 2) and 3) of part one of this Item does not deprive of the applicant of the right to the repeated address with the statement on issue of permission to transition of the right of subsurface use.

Article 41. Concept of the objects connected with the subsurface use right

1. The objects connected with the subsurface use right are the shares, shares, shares and other forms of equity, and also the securities confirming the property right or converted into shares, shares, shares and other forms of equity in the legal entity having subsurface use rights under the contract for exploration and production or hydrocarbon production, under the contract for uranium production, according to the license for investigation or production of solid minerals.

The objects connected with the subsurface use right the shares, shares, shares and other forms of equity, and also the securities confirming the property right or converted into shares, shares, shares and other forms of equity in the legal entity or other organization who have opportunity directly are also recognized and (or) to indirectly determine the decisions made by person having the subsurface use rights specified in part one of this Item.

2. For the purposes of of this Code are not recognized the objects connected with the subsurface use right under the relevant contract or the license for subsurface use:

1) being traded on the organized market of securities of the Republic of Kazakhstan and (or) stock exchange performing activities in the territory of foreign state, the share and other securities including derivative financial instruments which underlying asset are shares;

2) shares, shares, shares and other forms of equity in the legal entities and the organizations directly or indirectly owning the securities provided in the subitem 1) of this Item.

3. If the legal entity or the organization at the same time holds the shares, shares, shares and other forms of equity specified in Items 1 and 2 of this Article, share, share, shares and other forms of equity are recognized such person or the organization the objects connected with the subsurface use right. At the same time for the purpose of this Article for establishment of possibility of the legal entity or other organization directly or indirectly to determine the decisions made by person having subsurface use rights shares, shares, shares and other forms of equity which are not the objects connected with the subsurface use right according to Item 2 of this Article are not considered.

Article 42. Transition of the objects connected with the subsurface use right

1. Transition of the objects connected with the subsurface use right is recognized:

1) their alienation based on paid or non-paid civil transactions, including in case of liquidation of the legal entity, and also their introduction as contribution to the authorized capital of the legal entity or other organization;

2) the address of collection on the objects connected with the subsurface use right including in case of pledge;

3) emergence of the right to the object connected with the subsurface use right as a result of acceptance of the new participant, the unitholder or share placing;

4) transition of the objects connected with the subsurface use right according to the procedure of legal succession based on the transfer act or the separation balance sheet by reorganization of the legal entity;

5) transition of the objects connected with the subsurface use right according to the procedure of inheritance;

6) share issue and other securities which are the objects connected with the subsurface use right in the address in the organized market of securities.

Share issue and other securities which are the objects connected with the subsurface use right in the address in the organized market of securities the offer on acquisition of such objects in the organized market of securities is recognized the Republic of Kazakhstan and (or) on the stock exchange performing activities in the territory of foreign state and (or) share placing in the organized market of securities in the Republic of Kazakhstan and (or) on the stock exchange performing activities in the territory of foreign state.

2. The person which acquired the objects connected with the subsurface use right, or performed release into the stream of commerce of the shares and other securities which were the objects connected with the subsurface use right shall notify competent authority on the taken place acquisition or, respectively, on the taken place release into the stream of commerce no later than one month from the date of acquisition or such release into the stream of commerce in time.

3. For the purposes of of this Code is not recognized transition of the objects connected with the subsurface use right, change of the owner of shares, shares, shares and other instruments of equity or change of their ratio based on the judgment, inheritances under the law, repayments of share, confiscation and other events or actions of state bodies, the third parties who are not depending on will of the subject of legal relationship.

Article 43. Priority right of the state

1. In again signed and earlier signed contracts for subsurface use the state has the priority right before any persons and the organizations, including persons and the organizations which have privileges based on the laws of the Republic of Kazakhstan or the agreement, on acquisition of right of the alienable right of subsurface use (share in the subsurface use right) on the strategic subsoil plot, and also the securities of the shares and other securities which are the objects connected with the subsurface use right on the strategic subsoil plot released in the organized market.

2. The subsoil plot is strategic:

1) containing geological inventories of oil of more than fifty million tons or natural gas more than fifteen billion cubic meters;

2) located in the Kazakhstan sector of the Caspian Sea;

3) containing the field of uranium.

The list of strategic subsoil plots affirms the Government of the Republic of Kazakhstan.

3. Provisions of Item 1 of this Article are not applied in cases, stipulated in Item 2 Articles 44 of this Code.

Article 44. Permission to transition of the right of subsurface use and the objects connected with the subsurface use right

1. Transition of the right of subsurface use (share in the subsurface use right) which arose based on the contract for subsurface use, the license for investigation or licenses for production of solid minerals, the license to use of space of subsoil, and also transition of the objects connected with the subsurface use right are performed with the permission of the competent authority issued according to the procedure, established by this Code.

2. Permission of competent authority, stipulated in Item 1 this Article, is not required in case:

1) transition of the right of subsurface use (share in the subsurface use right), the objects connected with the subsurface use right for benefit of the affiliated organization in which at least ninety nine percent of shares, shares, shares or other forms of equity belong to the subsoil user or, respectively, the owner of the objects connected with the subsurface use right provided that such affiliated organization is not registered in the state with the preferential taxation;

2) transition of the right of subsurface use (share in the subsurface use right), the objects connected with the subsurface use right between the organizations, including according to the procedure of legal succession as a result of reorganization of legal entities, in each of which at least ninety nine percent of shares, shares, shares or other forms of equity directly or indirectly belong to the same person provided that the acquirer of the right of subsurface use (share in the subsurface use right), the objects connected with the subsurface use right is not registered in the state with the preferential taxation;

3) transition of the right of subsurface use (share in the subsurface use right), the objects connected with the subsurface use right for benefit of person or the organization who, (which) directly or indirectly belongs at least ninety nine percent of shares, shares, shares or other forms of equity in the legal person subsoil user or, respectively, the owner of the objects connected with the subsurface use right provided that the acquirer is not registered in the state with the preferential taxation;

4) transition of the right of subsurface use (share in the subsurface use right), the objects connected with the subsurface use right as a result of distribution of property of the liquidated legal entity if at least ninety nine percent of shares, shares, shares or other forms of equity in the acquirer of the right of subsurface use (share in the subsurface use right) and (or) the objects connected with the subsurface use right directly or indirectly belong to the same person provided that the acquirer is not registered in the state with the preferential taxation;

5) transition of shares, shares, the shares which are the objects connected with the subsurface use right if as a result of such transition person becomes owner less than one percent of share, shares, shares in the authorized capital of legal person subsoil user and (or) legal entity or other organization which (which) has opportunity directly and (or) indirectly to influence decisions of legal person subsoil user;

6) changes of the size of the authorized capital, including share placing, and also sale of earlier redeemed shares or other securities converted into shares of the legal entity if as a result of such actions the percentage ratio of the shares belonging to participants, to holders of the shares or shareholders of the shares or other securities converted into shares, which are the objects connected with the subsurface use right does not change;

7) transition of the right of subsurface use (share in the subsurface use right), the objects connected with the subsurface use right according to the transaction in which one of the parties is the Government of the Republic of Kazakhstan, state body, national managing holding or the national company;

8) alienations of the right of subsurface use (share in the subsurface use right), the objects connected with the right of the subsurface use performed in the course of privatization of property complexes of the state companies;

9) transition of the right of subsurface use, the objects connected with the subsurface use right according to the procedure of legal succession based on the transfer act when transforming the legal entity;

10) transition of the right of subsurface use (share in the subsurface use right), the objects connected with the subsurface use right according to the procedure of inheritance;

11) the redemption the issuer of the shares, shares, shares and other forms of equity, and also the securities confirming the property right or converted into the shares, shares, shares and other forms of equity which are the objects connected with the subsurface use right;

12) issue of securities, confirming the property right or converted into the shares, shares, shares and other forms of equity which are the objects connected with the subsurface use right when person who is earlier the owner of the above-stated shares, shares, shares and other forms of equity remains the owner of issued securities;

13) acquisitions of the objects connected with the subsurface use right, in exchange before the issued securities confirming the property right or converted into the shares, shares, shares and other forms of equity which are the objects connected with the subsurface use right;

14) participations of security holders, being the objects connected with the subsurface use right in general shareholder meeting or members of the organization in which the share, shares, shares and other forms of equity are such objects connected with the subsurface use right.

3. For the purposes of this Chapter are also equated to subsoil users:

1) the organizations participating as the strategic partner of the national company in the field of hydrocarbons in direct negotiations with competent authority on provision of the right of subsurface use;

2) the organizations allowed to participation in auction on provision of the right of subsurface use for hydrocarbons;

3) the organizations which received the notification of competent authority on need of conducting state examinations or approval of project documents by consideration of question of licensing for production of solid minerals.

4. The transactions on transition of the right of subsurface use, objects connected with the subsurface use right made without the permission of competent authority, and it is equal after permission effective period, are insignificant.

Article 45. Approval procedure on transition of the right of subsurface use and (or) the objects connected with the subsurface use right

1. Persons having intention to acquire the subsurface use right (share in the subsurface use right) which arose based on the contract for subsurface use, the license for investigation or licenses for production of solid minerals, the license to use of space of subsoil or objects connected with the subsurface use right direct the application for issue of permission to competent authority.

2. The statement for issue of permission shall contain:

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