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RESOLUTION OF BOARD OF NATIONAL BANK OF THE REPUBLIC OF KAZAKHSTAN

of January 28, 2017 No. 19

About approval of Rules of forced share repurchase of the insurance (reinsurance) organization and their subsequent sale to the new investor (investors)

(as amended on 23-12-2020)

According to the Law of the Republic of Kazakhstan of December 18, 2000 "About insurance activity" the Board of National Bank of the Republic of Kazakhstan DECIDES:

1. Approve the enclosed Rules of forced share repurchase of the insurance (reinsurance) organization and their subsequent sale to the new investor (investors).

2. Declare invalid the resolution of Board of National Bank of the Republic of Kazakhstan of June 28, 2001 No. 262 "About approval of Rules of the forced redemption and implementation of shares of the insurance (reinsurance) organization" (registered in the Register of state registration of regulatory legal acts at No. 1622, published in 2001 in the Bulletin of regulatory legal acts of the central executive and other state bodies of the Republic of Kazakhstan No. 30, the Art. 476).

3. To department of insurance supervision (Kurmanov Zh. B.) in the procedure established by the legislation of the Republic of Kazakhstan to provide:

1) together with Legal department (Sarsenov N. V.) state registration of this resolution in the Ministry of Justice of the Republic of Kazakhstan;

2) within ten calendar days from the date of state registration of this resolution the direction it the copy in paper and electronic type in the Kazakh and Russian languages in the Republican state company on the right of economic maintaining "The republican center of legal information" for official publication and inclusion in Reference control bank of regulatory legal acts of the Republic of Kazakhstan;

3) placement of this resolution on official Internet resource of National Bank of the Republic of Kazakhstan after its official publication.

4. To management on consumer protection of financial services and external communications (Terentyev A. L.) provide within ten calendar days after state registration of this resolution the direction it to the copy on official publication in periodic printing editions.

5. To impose control of execution of this resolution on the vice-chairman of National Bank of the Republic of Kazakhstan Smolyakov O. A.

6. This resolution becomes effective after ten calendar days after day of its first official publication.

Chairman of National Bank

D. Akishev

Approved by the Resolution of Board of National Bank of the Republic of Kazakhstan of January 28, 2017 No. 19

Rules of forced share repurchase of the insurance (reinsurance) organization and their subsequent sale to the new investor (investors)

Chapter 1. General provisions

1. These rules of forced share repurchase of the insurance (reinsurance) organization and their subsequent sale to the new investor (investors) (further - Rules) are developed according to the Law of the Republic of Kazakhstan of December 18, 2000 "About insurance activity" and determine procedure for the forced redemption and the subsequent sale of shares of the insurance (reinsurance) organization (further - insurance company) authorized body by regulation, control and supervision of the financial market and the financial organizations (further - authorized body) to the new investor (investors) (further - the new investor).

2. In Rules the following concepts are used:

1) the former shareholder - person who was the shareholder of insurance company and which shares were compulsorily redeemed by authorized body according to Rules;

2) the shareholder - physical person or legal entity to which passed the property rights according to the redeemed shares on the conditions determined by Rules;

3) the new investor - the physical person or legal entity which entered negotiations with authorized body concerning acquisition of the redeemed shares on the conditions determined by Rules;

4) the redeemed shares - the shares of insurance company acquired by authorized body according to Rules.

3. The forced share repurchase of insurance company and their subsequent sale to the new investor is performed by authorized body for the purpose of protection of legitimate interests of her insurers, insured, beneficiaries and ensuring stability of the insurance market based on the decision (decisions) of authorized body and does not require availability of declaration of will of former shareholders of insurance company.

4. The authorized body applies the procedure of forced share repurchase of insurance company for the purpose of ensuring transition of the property right to shares of insurance company to the new investor and is not final acquirer (owner) of the redeemed shares.

Chapter 2. Bases and conditions of forced share repurchase of insurance company and their subsequent sale to the new investor

5. The basis for the forced redemption of all shares of insurance company is establishment of negative difference by authorized body between the asset cost calculated taking into account their classification by quality and liquidity and obligations of insurance company.

6. Calculation of difference between asset cost and obligations of insurance company is performed according to the legislation of the Republic of Kazakhstan on insurance and insurance activity.

7. The following requirements are imposed to the new investor of insurance company:

1) compliance to requirements imposed by the legislation of the Republic of Kazakhstan on insurance and insurance activity for the shareholder of insurance company;

2) opportunity availability (separately or together with other new investors) to fulfill all agreement obligations of insurance and reinsurance;

3) adoption of the commitment letter on maintaining confidentiality and preserving trade secret.

8. The decision on the subsequent sale of the redeemed shares to the new investor is made by authorized body in case of fulfillment of requirements, 11 and 14 Rules provided by Items 7,.

Chapter 3. Procedure of carrying out forced share repurchase of insurance company and their subsequent sale to the new investor

9. The authorized body performs actions for search of the new investor by means of the publication of the relevant information in the periodic printing editions distributed in all territory of the Republic of Kazakhstan, in the Kazakh and Russian languages, and on official Internet resource of authorized body.

10. Person conforming to requirements of Item 7 of Rules files in authorized body petition for intention to acquire all shares of insurance company (further – the applicant).

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