ORDER OF THE GOVERNMENT OF THE REPUBLIC OF KAZAKHSTAN

of October 26, 2023 No. 944

About approval of Rules (technique) of pricing on the exported crude oil and gas condensate in case of their realization by the subsoil users who are performing activities for the contract for subsurface use approved by the President of the Republic of Kazakhstan, or to agreements (contracts) on the Section of products signed with the Government of the Republic of Kazakhstan or competent authority till January 1, 2009 and, passed the obligatory tax examination, with use of ports of the Mediterranean Sea along route the railway station of the Republic of Kazakhstan and (or) Aktau port - Baku - Ceyhan

According to the subitem 3) of Item 10 of article 10 of the Law of the Republic of Kazakhstan "About transfer pricing" the Government of the Republic of Kazakhstan DECIDES:

1. Approve the enclosed Rules (technique) of pricing on the exported crude oil and gas condensate in case of their realization by the subsoil users who are performing activities for the contract for subsurface use approved by the President of the Republic of Kazakhstan, or to agreements (contracts) on the Section of products signed with the Government of the Republic of Kazakhstan or competent authority till January 1, 2009 and, passed the obligatory tax examination, with use of ports of the Mediterranean Sea along route the railway station of the Republic of Kazakhstan and (or) Aktau port - Baku - Ceyhan.

2. This resolution becomes effective after ten calendar days after day of its first official publication and extends to the legal relationship which arose since February 1, 2023.

Approved by the Order of the Government of the Republic of Kazakhstan of October 26, 2023 No. 944

Governed (technique) of pricing on the exported crude oil and gas condensate in case of their realization by the subsoil users who are performing activities for the contract for subsurface use approved by the President of the Republic of Kazakhstan, or to agreements (contracts) on the Section of products signed with the Government of the Republic of Kazakhstan or competent authority till January 1, 2009 and, passed the obligatory tax examination, with use of ports of the Mediterranean Sea along route the railway station of the Republic of Kazakhstan and (or) Aktau port - Baku - Ceyhan

Chapter 1. General provisions

1. These rules (technique) of pricing on the exported crude oil and gas condensate in case of their realization by the subsoil users who are performing activities for the contract for subsurface use approved by the President of the Republic of Kazakhstan, or to agreements (contracts) on the Section of products signed with the Government of the Republic of Kazakhstan or competent authority till January 1, 2009 and, passed the obligatory tax examination, with use of ports of the Mediterranean Sea along route the railway station of the Republic of Kazakhstan and (or) Aktau port - Baku - Ceyhan (further - technique) are developed based on the subitem 3) of Item 10 of article 10 of the Law of the Republic of Kazakhstan "About transfer pricing" (further - the Law) and determine pricing technique on crude oil, gas condensate, including in case of their realization with use of ports of the Mediterranean Sea along route the railway station of the Republic of Kazakhstan and (or) Aktau port - Baku - Ceyhan and ports of the Caspian Sea on the terms of FOB * port of the Caspian Sea.

This technique extends to transactions with crude oil and gas condensate, the got subsoil users on the contract for subsurface use approved by the President of the Republic of Kazakhstan or agreements (contracts) on the Section of products signed with the Government of the Republic of Kazakhstan or competent authority till January 1, 2009 and which passed the obligatory tax examination.

For determination of market price of crude oil and gas condensate (further - goods) official sources of information which were determined in the contract of purchase and sale are used.

2. In this technique the following terms and determinations are used:

1) advance payment - advance payment for the delivery of goods planned, but not shipped yet;

2) the quoted period - the pricing period, but no more than thirty one calendar consecutive day for which quotations of the prices at the exchange are published established in the contract for sales of goods (works, services) during which in accordance with the terms of the transaction the parties of the transaction determine arithmetic-mean value of arithmetic-mean daily quotations of the prices of the corresponding exchange goods (works, services), and also not exchange goods, the prices for which are tied to quotations on exchange goods;

3) differential - the amount of adjustment applied to reduction in comparable economic conditions of transaction price or the price from information source;

4) the bill of lading - the document on shipped goods which confirm its obtaining by the vessel;

5) transaction price (realization) - the goods cost for one unit of measure according to contracts of purchase and sale of goods expressed in contract currency of purchase and sale of goods and calculated according to this technique;

6) early payment - payment for shipped goods before the payment due dates specified in contracts of purchase and sale;

7) the quotation of oil - the price quotation published in official sources of information;

8) the oil delivery and acceptance act - the document issued by carrier of goods to the freight owner in case of transportation through the pipeline;

9) other sources of information - information sources used for determination of market price of goods (work, service) and other data necessary for application of methods of determination of market price, according to article 18 of the Law;

10) end-to-end rate - all transportation expenses connected with the goods delivery along route from Aktau port to the port Ceyhan;

11) official source of information - information source included in the list officially of acknowledged sources of information on market prices;

12) adjustment on quality - price adjustment of the transaction on quality characteristics of goods (density, sulfur content, water, mechanical impurity);

13) the North price Sea benchmark - the quotation of Brent (Dated) or North Sea Dated oil, or "BFOE" published in official sources of information;

14) spread - the price difference between different quotations published in official sources of information;

15) the report of independent inspectorate - the official document issued by independent inspection and containing information on results of check of quantity and quality of load in case of its shipment, obtaining or on the whole site of route according to regulations of the international practice and corporate standards;

16) the position schedule in shipping port - the loading schedule (arrangements) of tankers in shipping port;

17) the transit agreement - the agreement of transit of goods signed with transportation company.

Note.

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