LAW OF THE REPUBLIC OF KAZAKHSTAN

of July 7, 2006 No. 167-III ZRK

About concessions

This Law determines legal conditions of concession, types of the state support of the concessionary and governs the public relations arising in the course of the conclusion, execution and the termination of agreements of concession.

Chapter 1. General provisions

Article 1. The basic concepts used in this Law

In this Law the following basic concepts are used:

1) authorized state body on budget implementation - the central executive body performing management and cross-industry coordination in the field of budget implementation, conducting financial accounting, the budget accounting and budget reports on execution of the republican budget and within the competence of local budgets, National fund of the Republic of Kazakhstan based on the report of National Bank of the Republic of Kazakhstan;

1-1) authorized bodies on budgetary planning - the central executive body performing management and cross-industry coordination in the field of budgetary planning;

2) objects of social infrastructure and life support - the objects, complexes of objects used for satisfaction of public requirements which ensuring is assigned to state bodies according to the legislation of the Republic of Kazakhstan;

3) private concessionary obligations - obligations assumed by the concessionary under the signed agreement of concession;

3-1) accounts, intended for transfer of compensation of investment costs, - the bank account opened for the concessionary by the creditor with restriction of its right to making of account transactions on it before approach or accomplishment by it of the conditions determined by the agreement of financing under concession of monetary claim and (or) the agreement of concession;

4) the concedent - one or several state bodies of the Republic of Kazakhstan acting on behalf of the Republic of Kazakhstan or the Government of the Republic of Kazakhstan signing the agreement of concession according to this Law or the local executive body of the Republic of Kazakhstan signing the agreement of concession according to this Law on behalf of administrative and territorial unit (the area, either the city of republican value, or the capital);

5) the concessionary - the physical person performing business activity, and (or) the legal entity, except for public institutions and subjects of the quasi-public sector, fifty and more percent of voting shares which signed the agreement of concession (shares in the authorized capital) which directly or indirectly belong to the state (except the organizations for financing of concessionary projects), including performing the activities on the basis of cooperation agreement (particular partnership);

6) concession - the activities directed to creation (reconstruction) and operation of subjects to concession, performed at the expense of means of the concessionary or on the terms of joint financing by the concedent;

7) the organizer of tender (auction) for concession (further - the organizer of tender (auction) - the state body performing carrying out tenders (auctions) at the choice of the concessionary;

8) the concessionary project - set of actions for implementation of the concession realized during the limited period of time and having complete nature according to the budget legislation of the Republic of Kazakhstan and this Law. Concessionary projects can be referred to category of concessionary projects of the special importance which list is determined by the Government of the Republic of Kazakhstan.

Criteria of reference of concessionary projects to category of concessionary projects of the special importance are determined by authorized body by state planning;

8-1) compensation of investment costs on the concessionary project - the money payments for the account of budgetary funds directed to compensation after input of subject to concession in operation by equal shares during the term constituting at least five years, certain amount of investment costs according to the agreement of concession. At the same time postponement of payments of compensation of the investment costs established by the agreement of concession for the early periods is forbidden;

9) advisory support of concessionary projects - the services rendered by legal entities on support of concessionary projects, including development and (or) adjustment of tender (auction) documentation, draft agreements of concession, rendering consulting services in negotiation process of the commission with the participant of tender (auction);

10) joint financing of concessionary projects - allocation of budgetary funds for financing of certain amount of costs for creation (reconstruction) of subjects to concession;

11) the feasibility statement on the concessionary project (further - the feasibility statement) - the preproject documentation containing results of marketing, technical and technological, social and economic and ecological researches, and also the institutional decisions, finance solutions proving feasibility and sales opportunity of the concessionary project, decision by assessment and distribution of risks between participants of the concessionary project, to determination of types and the amount of the state support in case of need and also on influence of the project on the government budget and social and economic effect on development of economy in general and its industries in case of its realization;

12)  No. 112-VI ZRK is excluded according to the Law of the Republic of Kazakhstan of 30.11.2017;

13) the specialized organization for concession - the organization created by the Government of the Republic of Kazakhstan for rendering services in questions of concession;

14) subject to concession - the objects of social infrastructure and life support included in the list which are created (are reconstructed) and operated under the agreement of concession;

15) creation of subject to concession - creation of the subject to concession which was earlier not existing in the territory of the Republic of Kazakhstan, including on the basis of new technologies, mechanization and automation of production, installation of new production equipment on subject to concession, production of other work types providing functioning of subject to concession;

16) operation of subject to concession - use of subject to concession by the concessionary according to purpose of subject to concession, including for the purpose of production of goods and (or) performance of works, and (or) rendering services, according to the procedure and on the conditions determined by the agreement of concession;

17) reconstruction of subject to concession - change of certain rooms, other parts of the building or building in general by holding actions for reorganization on the basis of implementation of new technologies, mechanization and automation of production, upgrade and replacement technically obsolete and (or) physically worn-out equipment new more productive equipment, and also to change of technological or functional purpose of subject to concession or its separate parts, other actions for improvement of characteristics and operational properties of subject to concession;

18) the agreement of concession - the written agreement between the concedent and the concessionary determining the rights, obligations and responsibility of the parties, concession sales terms;

19) No. 380-V ZRK is excluded according to the Law of the Republic of Kazakhstan of 31.10.2015

20) authorized body on state planning - the central executive body performing management and cross-industry coordination in the field of strategic and economic planning;

21) authorized state body on implementation of the right of the order republican property - the state body performing within the competence special executive and control functions in the sphere of management of objects of republican property, privatization and state monitoring of property, in industries (spheres) of economy having strategic importance;

22)  No. 150-V ZRK is excluded according to the Law of the Republic of Kazakhstan of 03.12.2013

23) authorized state body of the corresponding industry - the central executive body performing management of the corresponding industry (sphere) of public administration;

24) the list - the list of the objects offered in concession for the medium-term period approved by authorized body on state planning if objects belong to republican property, or maslikhats of areas, cities of republican value and the capital if objects belong to municipal property;

25) the direct agreement - the written agreement signed between the concedent, the concessionary and creditors of the concessionary for implementation of concessionary projects according to provisions of article 26-2 of this Law;

Article 2. Legislation of the Republic of Kazakhstan on concessions

1. The legislation of the Republic of Kazakhstan on concessions is based on the Constitution and consists of the Civil code of the Republic of Kazakhstan, the Law of the Republic of Kazakhstan "About public-private partnership", this Law and other regulatory legal acts of the Republic of Kazakhstan.

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