Document from CIS Legislation database © 2003-2021 SojuzPravoInform LLC

LAW OF THE KYRGYZ REPUBLIC

of July 23, 2002 No. 124

About the microfinancial organizations in the Kyrgyz Republic

(as amended on 23-03-2020)

Accepted by General Court of Jogorku Kenesh of the Kyrgyz Republic on June 11, 2002

Approved by the Meeting of national representatives of Jogorku Kenesh of the Kyrgyz Republic on July 3, 2002

This Law determines the status, regulates activities of the microfinancial organizations and is directed to creation of legal and organizational prerequisites for implementation of microfinancial activities in the Kyrgyz Republic.

Chapter 1. General provisions

Article 1. Determinations

1. The microfinancial organization is the specialized financial and credit or credit institute (microfinance company, the microcredit company, the mikrocreditny agency) created as the legal entity for the purpose of rendering microfinancial services for physical persons and legal entities, including according to the Islamic principles of banking and financing.

The microfinancial organization performs the activities based on the license (certificate) of National Bank of the Kyrgyz Republic (further - National Bank). The microfinancial organization is not bank and can perform separate banking activities according to requirements of this Law.

The microfinancial organization performs the activities according to this Law, regulatory legal acts of National Bank, and also taking into account features of the Law of the Kyrgyz Republic "About National Bank of the Kyrgyz Republic, banks and banking activity".

2. Microfinance company is the specialized financial credit institute created in the form of joint-stock company, which obtained the license of National Bank and performing the microcredit of legal entities and physical persons and other transaction types, including attraction of term deposits from physical persons and legal entities provided by this Law.

3. The microcredit company is the specialized financial credit institute created in any form of business of the commercial organization, which received the certificate of National Bank and performing the microcredit of physical persons and legal entities and other transaction types provided by this Law.

4. The Mikrocreditny agency is the specialized credit institute created in the form of non-profit organization behind the exceptions established by this Law, the received certificate of National Bank and the performing microcredit of physical persons and legal entities according to the authorized purposes of the organization.

5. Affiliate of the microfinancial organization is any physical (insider) or the legal entity (except for the state bodies exercising control of activities of the microfinancial organization within the powers conferred to them) who has the right directly or indirectly to determine decisions or to exert impact on the decisions made by the microfinancial organization, including owing to the agreement (including the verbal agreement) or other transaction, and also any physical (insider) or the legal entity concerning whom this affiliate has such right. The affiliate of microfinance company his executive officials, shareholders (participants) or any company owning five and more percent of its voting shares are also recognized.

6. The microcredit is the money provided by the microfinancial organization to physical persons or communities created by them, legal entities according to the charter of the microfinancial organization.

The cumulative sizes of the microcredit and leasing for provision to the same face or group of the connected persons are established and regulated by National Bank.

7. The microfinancial activities are activities of the microfinancial organizations for provision of microfinancial services according to this Law.

8. Issue of the microcredits is drawn up by the credit agreement according to requirements of the legislation, including under subsidiary or joint liability of group of persons.

9. Activities of other types of financial credit institutes, including credit unions, are regulated by the Law of the Kyrgyz Republic "About credit unions" and other regulatory legal acts of the Kyrgyz Republic.

Article 2. Purpose of activities of the microfinancial organization

The purpose of activities of the microfinancial organizations is provision to the population of available services in microfinancing for increase in the employment level, assistance to development of entrepreneurship and social mobilization of the population of the Kyrgyz Republic.

At the same time the microfinancial organization has the right to pursue also other aims determined by its constituent documents and which are not contradicting the current legislation of the Kyrgyz Republic.

Article 3. Name of the microfinancial organization

1. The microfinancial organization shall use only that name which is provided in the charter of the microfinancial organization, and depending on the type in the name to use words "microfinance company", "microcredit company", "mikrocreditny agency", and in the short name according to abbreviation of IFC, "MKK", MKA.

2. The microfinancial organization cannot use in one of documents, announcements or promotional materials the name, other than that which is given in its charter.

3. The microfinancial organization has no right to use in the name or symbolics of the word "national", "state", "Kyrgyz Republic", Kyrgyzstan in any language, in any combination.

4. Terms "microfinance company", "microcredit company", "mikrocreditny agency" or abbreviations of IFC, "MKK", MKA, or any words in combination with these terms can be used in trade name and for the purpose of advertizing only of that microfinancial organization which is effective according to the license or the certificate within this Law.

5. Change of the name of the microfinancial organization is performed after preliminary coordination with National Bank. The microfinancial organization shall within three days after change of the name and/or the location to give about it the notification in mass media.

6. Use as the name of the designations identical or similar to extent of their mixture with the name of the banks which are earlier created or created in the territory of the Kyrgyz Republic or the microfinancial organizations is not allowed.

This prohibition does not extend to subsidiary banks or the affiliated microfinancial organizations when using of names of the main banks (parent) or microfinancial organizations by them (maternal).

Article 4. Differentiation of responsibility of the Kyrgyz Republic and microfinancial organizations

1. The microfinancial organizations do not answer for obligations the Kyrgyz Republic, as well as the Kyrgyz Republic does not answer for obligations the microfinancial organizations, except as specified, when the parties voluntarily assume such obligations.

2. The microfinancial organizations do not answer for obligations National Bank, as well as the National Bank does not answer for obligations the microfinancial organizations.

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