RESTRICTED
WORLD TRADE WT/ACC/KAZ/6/Add.2
17February 1997
ORGANIZATION(97-0598)
Original: English
ACCESSION OFKAZAKSTAN
Additional Questions andReplies
totheMemorandum ontheForeign Trade Régime
(Document WT/ACC/KAZ/3)
Addendum
Additional questions submitted byMembers andthereplies thereto provided bytheauthorities
ofKazakstan arereproduced hereunder. Theattachments mentioned inthisdocument areavailable
intheSecretariat (Accessions Division, Room 1126) forconsultation.
_______________WT/ACC/KAZ/6/Add.2
Pageii
TABLE OFCONTENTS
Page
No.Quest.
No.
II. ECONOMY, ECONOMIC POLICIES AND FOREIGN TRADE
2. Economic Policies
(a) Main directions andgoals
Pricing policy 1 1-4
Trade policy 5 5
Private sector development/privatization 6 6-17
(b) Monetary andfiscal policy 10 18-19
(c) Foreign exchange, payments system andrelations withtheIMF
Foreign exchange 11 20-26
(e) Competition policies 15 27
III. FRAMEWORK FOR MAKING AND ENFORCING POLICIES
AFFECTING FOREIGN TRADE INGOODS AND TRADE IN
SERVICES
1. Powers oftheExecutive, Legislative andJudicial Branches of
Government
(c) Powers oftheJudiciary 17 28-30
4. Legislative Programmes orPlans toChange theRegulatory Régime
(a) Agenda fordrafting newlaws 18 31-33
IV. POLICIES AFFECTING TRADE INGOODS
1. Import Regulation
(a) Registration requirements forengaging inimporting 20 34-35
(b) Characteristics ofthenational tariff andnomenclature 22 36-38
(d) Other duties andcharges, specifying anycharges forservices
rendered
Customs Processing Feesandother customs services 22 39-44
Value-Added Tax(VAT) 24 45-46
Excise taxes 25 47-51
(e) Quantitative import restrictions, including prohibitions, quotas and
licensing systems 27 52-53
(f) Import licensing procedures 27 54-56
(h) Customs valuation 28 57-59
(j) Pre-shipment inspection 30 60-61
(k) Application ofinternal taxes onimports 31 62
(l) Rules oforigin 31 63
(m) Anti-dumping régime
(n) Countervailing dutyrégime
(o) Safeguard Regime 32 64-70WT/ACC/KAZ/6/Add.2
Pageiii
Page
No.Quest.
No.
2. Export Regulation
(b) Customs tariff nomenclature, types ofduties, dutyrates, weighted
averages ofdutyrates 33 71
(c) Quantitative export restrictions, including prohibitions, quotas and
licensing systems 33 72-73
(d) Export licensing procedures 34 74
(e) Other measures, e.g.minimum export prices, voluntary export
restrictions, orderly marketing arrangements 38 75-76
(f) Export financing, subsidy andpromotion policies 38 77-78
(h) Import dutydrawback schemes 39 79
3. Internal Policies Affecting Foreign Trade inGoods
(a) Industrial policy, including subsidy policies
Agricultural subsidies 39 80-82
Non-agricultural subsidies 40 83-84
(b) Technical regulations andstandards, including measures taken atthe
border withrespect toimports42 85-93
(c) Sanitary andphytosanitary measures, including measures taken with
respect otimports44 94
(d) Trade-related investment measures 45 95
(e) State-trading practices 45 96
(f) Freezones 45 97
(g) Freeeconomic zones 46 98-99
(h) Trade-related environmental policies 48 100-106
(j) Government-mandated countertrade andbarter 50 107
(l) Government procurement practices 50 108-113
(m) Regulation oftrade intransit 51 114
V. TRADE-RELATED INTELLECTUAL PROPERTY REGIME
1. General
(c) Membership ininternational intellectual property conventions and
regional orbilateral agreements
(ii) Anticipated membership ininternational intellectual property
conventions 52 115-116
(d) Application ofnational andm.f.n. treatment toforeign nationals 52 117
(e) Feesandtaxes 53 118
2. Substantive Standards ofProtection, Including Procedures forthe
Acquisition andMaintenance ofIntellectual Property Rights
(a) Copyright andrelated rights, including rights ofperformers,
producers ofphonograms andbroadcasting organizations 53 119-123WT/ACC/KAZ/6/Add.2
Pageiv
Page
No.Quest.
No.
(b) Trademarks, including service marks 55 124-126
(c) Geographical indications, including appellations oforigin 57 127-129
(d) Industrial designs 58 130-134
(f) Plant variety protection 59 135-136
(g) Layout designs ofintegrated circuits 59 137
(h) Requirements onundisclosed information, including trade secrets and
testdata60 138-141
3. Measures toControl Abuse 61 142
4. Enforcement
(a) Civil judicial procedures andremedies 62 143-144
(b) Provisional measures 62 145
(c) Administrative procedures andremedies 62 146
(d) Special border measures 63 147
(e) Criminal procedures 63 148
VI. TRADE-RELATED SERVICES REGIME
3. Market Access andNational Treatment
(b) Limitations onthetotalvalue ofservice transactions orassets 64 149
(f) Limitations ontheparticipation offoreign capital 64 150
(i) Provisions concerning anyform ofaid,grant, domestic subsidy, tax
incentive orpromotion scheme affecting trade inservices64 151-152
VII. INSTITUTIONAL BASIS FOR TRADE AND ECONOMIC
RELATIONS WITH THIRD COUNTRIES
1. Bilateral orPlurilateral Agreements Relating toForeign Trade in
Goods andTrade inServices65 -
2. Economic Integration: Customs Union andFreeTrade Agreements
Bilateral agreements providing dutyfreeforcertain products 65 153-156
Customs Union Agreements 67 157-159
Annex Listofattachments 68 -WT/ACC/KAZ/6/Add.2
Page1
II. ECONOMY, ECONOMIC POLICIES AND FOREIGN TRADE
2. Economic Policies
(a) Main directions andgoals
- Pricing Policy
Question 1.
With regard toKazakstan 'spricing policy, theMemorandum states thatcurrently onlypublic
services andState services remain subject toprice control.
Please provide alistofthese services which constitute public andState services. Incontinuation
ofprice liberalization, isitagoaloftheGovernment ofKazakstan toremove price controls in
these sectors aswell?
A. Public Services
TheState Committee onPricing andAnti-Monopoly Policy (Anti-Monopoly Committee) is
theStatebody responsible forcontrolling prices ofpublic services. Public services, subject toprice
control inKazakstan, areheatdistribution, sewage systems, telecommunication services (domestic and
international communication services, telegraph communication services, cable radio installation,
receiving/transmitting television andradio programmes viasatellite, anddatatransmission through
communication channels), water ,electricity, andgasdistribution. Themainobjective ofKazakstan 's
pricing policy inpublic services istheestablishment ofeconomically justifiable prices forallconsumers
reflecting, where applicable, interalia,thecostofproduction, thecostoftransportation, andthe
profitability ofentities providing suchservices. Thecostofproduction applies onlytoheatandwater
where fixed prices areusedtocontrol prices atproduction. Thecostoftransportation isdetermined
through tariffratesestablished toregulate natural monopolies (e.g.power transmission anddistribution
networks, telecommunication networks, gaspipelines, heatpipelines, sewage network, andwater
distribution networks). Therationale ofpricecontrol forpublic services (utilities) isthatsuchservices
depend heavily onnatural monopolies.
Public services arecertainly important fortradeinservices andinvestment inKazakstan. Most
investors are,ononehand, consumers ofsuchservices andsome, ontheother hand, havecommitted
investment insome oftheinfrastructure (natural monopolies) delivering suchservices. Inaddition,
many investors deliver theirservices using thenatural monopoly infrastructure. Therefore, theobjective
ofthepricing policy regarding public services inKazakstan isdesigned tobalance theinterests ofthe
consumers (thisincludes most investors inKazakstan) andtheinvestors inthenatural monopoly
infrastructure.
B. State Services
State services areprovided bythose entities authorized bytheState torender suchservices.
Feesandduties thatmaybecharged bysuchentities areestablished bylegislation. There isnoone
single legislation governing price control overState services. Feesandduties forState services are
either advalorem orfixed. Thefollowing tablesummarizes Stateservices andtheentities responsible
forrendering suchservices.
State Services Subject toPrice Control Entity Responsible forRendering Services
1.State auto-inspection TheState Automobile Inspection Department
under theMinistry ofInternal AffairsWT/ACC/KAZ/6/Add.2
Page2
State Services Subject toPrice Control Entity Responsible forRendering Services
2.Sanitary-epidemiological services:
- services ofresearch laboratories
regarding bacteria, viruses, radiology,
noise, andvibration
- sanitary andchemical research of
water, air,andsoil
- certification ofwork place
- evaluation ofdesign projects for
sanitary purposesSanitary-Epidemiological Stations under the
Ministry ofHealth
3.State veterinary services:
- issuance oflicence forveterinary
activities
- approval ofimport/export licence of
veterinary medicines
- registration ofveterinary medicineTheMinistry ofAgriculture
4.Statistical information services TheStatistics Committee
5.Registration ofmass media means TheNational Agency onPress andMass
Media
6.Fireinspection TheFireInspection Department under the
Ministry ofInternal Affairs
7.Evaluation ofconstruction projects Anylicensed entity
8.Alltrade marks andpatents related services
including registration; searches; and
investigations assetforth inAnnex 10of
WT/ACC/KAZ/3ThePatent Office under theMinistry of
Industry andTrade
9.Registration ofcopyrighted materials TheState Agency onCopyrights andRelated
Rights
10.Registration oflegalentities TheMinistry ofJustice
11.Customs processing andother customs
services asdescribed inTable 4.1of
WT/ACC/KAZ/3TheCustoms Committee
12.Receipt ofcertificate oforigin forexport
purposeTheTrade andIndustry Chamber
13.Registration ofexport contract TheCommodity Exchanges
14.Obtaining licences toperform certain
economic activitiesAuthorized State bodies according to
Table A7.5 ofWT/ACC/KAZ/3
15.Evaluation ofapplication forimport/export
licences byauthorized State bodies and
ministries according toTable A3.1 andTable
A9.1 ofWT/ACC/KAZ/3State bodies andministries according to
Table A3.1 andTable A9.1 of
WT/ACC/KAZ/3
16.Evaluation oflicence application to
perform certain economic activitiesSanitary, ecological, andmining supervision
bodies inaccordance withGovernment
Resolution No.1894 of29December 1995
17.Consultancy feescharged bycertain
ministries regarding lawsadministered bysuch
ministriesRespective ministriesWT/ACC/KAZ/6/Add.2
Page3
State Services Subject toPrice Control Entity Responsible forRendering Services
18.Safeguard services (e.g.protection of
premises)TheMinistry ofInternal Affairs
Stateduties arespecified bytheLawOnStateDuties of31December 1996. Stateduties are
allfixed andbased onMonthly Evaluation Index. Thefollowing isalistofallactivities subject to
State duties:
- claims submitted tocourt appeals, issuance ofcopies bythecourt;
- notary actions andnotarization ofdocuments;
- public registry (marriage, divorce, birth, death, etc.);
- registration related totravel abroad andissuance ofletter ofinvitation forvisas;
- issuance ofvisas;
- processing ofdocuments forcitizenship related matters;
- registration ofplace ofliving;
- registration forhunting right; and
- registration andre-registration ofcivilarmaments.
ThereasonforpricecontroloverStatefeesanddutieschargedbyentitiesrenderingStateservices
isthatonlyoneentity isauthorized bytheGovernment torender aspecific service.
Feesandduties aretransparent. With theexception offeesforintellectual property related
matters, feesapply equally toforeign andnational legalandnatural persons. Certain feesarecurrently
advalorem anddonotreflect thecostofservices rendered. Please notethatKazakstan iscurrently
intheprocess ofevaluating thoseStatefeesandduties toensure theyreflect thecostofservices rendered.
C. Public Transport
Prices forpublic transport (e.g. buses, trolleys) areestablished andcontrolled bylocal
administrations.
D. State Postal Services
TheStatePostOffice isconsidered anatural monopoly andtariff ratesforpostal services are
regulated bytheAnti-Monopoly Committee (AMC). Currently, thereareplans toeliminate theState
PostOffice from thelistofnatural monopolies in1997. Rates established byprivate competing
companies inthissector arenotregulated bytheAMC.
Currently, there isnosignificant competition forpostal services within Kazakstan. However,
there arenobarriers toenter thissector. Licences arerequired tobeengaged inpostal services and
could beapplied forattheMinistry ofTransport andTelecommunications according totheLawon
Licensing.
Please notethattherearecurrently morethanadozen national andforeign companies rendering
parcel andcourier services throughout Kazakstan. Companies likeDHL, UPS, Pony Express, TNT,
AseExpress dominate ininternational courier services.WT/ACC/KAZ/6/Add.2
Page4
E. Government Plans Regarding Price Control.
TheGovernment plans toeliminate price control forpublic transport services, State postal
services, certain telecommunication services, water (public utilities), andheatassoonascompetition
develops inthesesectors. Tariff regulations ofnatural monopolies, usedfordelivering public services,
willcontinue. Inaddition, feeswillcontinue tobecharged forStateservices andthisisnotcontradictory
tointernational practices. However, allfeesforStateservices willbereviewed toreflect thecostof
services rendered.
Question 2.
Which government entity determines andimplements price controls?
Answer:
TheGovernment establishes thelevel ofprices forState services through legislation. The
Anti-Monopoly Committee controls thefeesforthefollowing Stateservices: sanitary- epidemiological
services, veterinary services, registration ofmassmedia means, andfireprotection. Price control over
other State services isimplemented byentities authorized torender suchservices aslisted under
question 1ofthisdocument. Anyviolations (e.g.higher feesthanspecified under legislation) bythese
authorized entities maybeappealed tocourt.
TheAnti-Monopoly Committee approves andimplements thetariffratesfornatural monopolies
andtheprices ofwater andheat.
Prices forpublic transport services aredetermined andimplemented bylocaladministrations.
Question 3.
TheMemorandum indicates thatprofitability control stillexists fornatural monopolies. Please
identify thesectors thataresubject toprofitability control anddescribe howtheprofitability control
system operates.
When theMemorandum ontheForeign Trade Regime wassubmitted totheWTO Secretariat
inJuly1996, profitability control methodology wasusedtoregulate natural monopolies only. Today,
profitability control isnotusedatallinKazakstan. However, anewmethod which takes intoaccount
cost,investment, andprofit ofnatural monopolies isbeing used.
Only thefollowing natural monopolies aresubject tothisnewmethod:
- transmission anddistribution ofelectricity;
- distribution ofheat;
- oilandoilproducts pipelines;
- gaspipelines;
- railroads;
- water sewage systems;
- telecommunication networks.
Thetariff ratesfornatural monopolies areregulated according tothefollowing scheme:
1. Incaseanatural monopoly needs tochange itstariffrates, suchentity mustsubmit anapplication
totheAnti-Monopoly Committee (AMC) withattached documents reflecting proposals fornewratesWT/ACC/KAZ/6/Add.2
Page5
withindication ofprojected costs (rawmaterials, fuel,energy, labour, purchase ofcomponents and
finished products) anddesired profit.
2. TheAMCreviewsabovedocumentsespeciallyreasonabilityofprojectedcoststakingintoaccount
theoperations ofsimilar enterprises within Kazakstan andoutside ofKazakstan.
There arenorestrictions concerning thelevelofprofitability ifitiswellgrounded bythenatural
monopoly. Usage ofprofits ispermitted forthefollowing:
- alltypesofinvestmentsconnectedwithmodernizationandexpansionofproductiveinfrastructure
ofthenatural monopoly;
- payments andtaxes tothebudget;
- payment ofdividends.
Thetariffratesaredetermined bytheAMC onthebasisofdocuments provided bythenatural
monopoly. Anatural monopoly company maydispute thedecision oftheAMC regarding newtariff
ratesviaadministrative appeal totheAMC orusing thecourt.
Fornatural monopolies intheenergy sector, proposals forchanges intariffratesareconsidered
bytheEnergy Regulatory Commission (ERC) established inKazakstan. Please notethattheAMC
isamember oftheERC.
Natural monopoly maynotusedifferent tariff ratesforthesame services. Anexception is
onlygranted forthepipeline transport ofcrude oil.Tariff ratesarehigher fortransport ofexported
crude oil.Nevertheless, thesametariffratesapplies toforeign andnational companies exporting crude
oilfrom Kazakstan.
Inestablishing tariffrates, theAMC balances theinterests oftheconsumers (thisincludes most
investors inKazakstan) andtheinvestors innatural monopolies. InApril 1997, theAMC willintroduce
aprocedure ofpublic hearings which willallow thecustomers ofnatural monopolies todispute new
tariff ratesatthestage oftheirapproval.
Question 4.
Inparticular please describe howthecontrols areapplied toimports andhowtheyareapplied
todomestic goods.
Profitability control doesnotapply toimports.
- Trade policy
Question 5.
Kazakstan listsasoneofitspriorities theestablishment ofasystem ofmandatory insurance of
agricultural production. Please provide specific details onthisproposed insurance system. Does
thissystem entail theuseofsubsidies toguarantee aminimum levelofproducer income? Ifso,
willthesesubsidiesbedecoupledfromproductionlevels?Willtheybeusedasatransitionalmeasure
which willbephased outovertime?
Government Resolution No.1513 of10December 1996 called fortheestablishment ofthe
State-owned agricultural insurance enterprise Kazagropolis. Themainactivities ofKazagropolis shall
betoprovide insurance protection toagricultural producers, regardless oftypeofownership, againstWT/ACC/KAZ/6/Add.2
Page6
natural disasters, emergency situations caused byepizootics andepidemics, infection ofagricultural
plants withdiseases andpests. Inaddition, Resolution No.1513 called for:
- theappropriation ofUS$1.33 Million forthecharter fundofKazagropolis;
- thecreation ofanInterdepartmental Council. Theroleofthiscouncil willbetocoordinate
andorganize matters related tomandatory insurance anddevelop regulations regarding the
procedures andterms ofobligatory insurance ofagricultural production.
According toResolution No.1513, mandatory insurance ofagricultural production shallbe
carried outbyKazagropolis andother insurance organizations which haveappropriate licences. In
addition, theInsurance Supervision Body shallexamine thepossibility ofreinsuring risksofagricultural
production intheinternational reinsurance market.
Kazagropolis isnotyetregistered. TheInterdepartmental Council wasformed, andiscurrently
drafting regulations regarding procedures andterms ofmandatory insurance.
Private sector development/privatization
- Small-scale privatization
Question 6.
Kazakstan states that, asofJune 1996, over74percentofthesmall-scale enterprises hadbeen
privatized aspartofthesecond stage ofprivatization. Does thethird stage ofprivatization
(1996-1998) include theprivatization oftheremaining small-scale enterprises?
Thetotalnumber ofenterprises andobjects qualifying forsmall-scale privatization isestimated
tobeapproximately 20,000. Asoftheendof1996, approximately 84percentofthese enterprises
havebeenprivatized. Itisexpected thatsmall scaleprivatization becompleted during thethirdstage
ofprivatization (1996-1998).
- Mass privatization
Question 7.
Willmass privatization becompleted, asplanned, bytheendof1996? Ofthe1712 companies
participating inthemass privatization programme, howmany havebeensold? What isthetime
frame forthedisposition oftheenterprises offered, butnotyetsold,through themass privatization
programme?
Asof31January 1996, coupon auctions werecompleted forall1,712 companies participating
inthemass privatization programme. Duetoliquidation, thenumber hasdecreased from 1,712 to
1,668 companies in1996. Asof31January 1997, 467companies havebeentotally soldthrough cash
auctions. Theremaining Stateshare inthe1,201 remaining companies willbescheduled/re-scheduled
forcashauctions in1997 untilallState shares inthese companies aresold. Itisexpected thatthe
remaining 1,201 companies willbecompletely privatized bytheendof1997.
- Case bycaseprivatization
Question 8.
What isthecurrent status ofprivatization fortheenterprises subject tocasebycaseand
agro-industrial complex privatization? Were allcasebycaseandagro-enterprises disposed ofWT/ACC/KAZ/6/Add.2
Page7
during thesecond stage oftheprivatization? Willtheremainder bedisposed ofinthethird stage
ofprivatization? What isthetimetable forthedisposition oftheremaining enterprises?
A. Case-by-Case
Around160largecompaniesarescheduledforcase-by-caseprivatization.Asof1January1997,
33enterprises havebeensoldtoforeign anddomestic investors, 46enterprises arecurrently under
contract management (24companies under themanagement offoreign companies). Theremaining
enterprises areexpected tobeprivatized during thethirdstage ofprivatization (1996-1998).
B. Agro-Industrial Complex
Only487enterprises intheagro-industrial sector havebeenfullysold. Around 190enterprises
inthissector arecurrently under contract management. TheStateshares (approximately 29percent)
intheremaining enterprises arescheduled forsaleviacashauctions toforeign anddomestic investors.
Itisexpected thatallremaining enterprises besoldduring thethirdstageofprivatization (1996-1998).
Question 9.
Areforeign investors eligible toparticipate inthe150investment funds thatnowownshares in
privatized companies? What conditions orrestrictions apply toforeign investors seeking to
participate intheinvestment fund?
Presidential Resolution No.1290of23June1993(Resolution No.1290) established thelegal
framework forPrivatization Investment Funds (PIFs):
- themain function ofPIFsistocollect privatization coupons from Kazakstani citizens and
exchange them forshares inenterprises privatized under themass privatization programme;
- thefounders ofPIFsmaybenatural persons orKazakstani legalentities;
- PIFsmust beinitially created asJSCs ofclosed type(shares maybetraded onlybetween
founders andacircle ofpersons specified atthemoment ofregistration);
- conversion ofPIFstoJSCs ofopentype(shares maybetraded freely) ispermitted afterthe
completion ofmass privatization coupon auctions.
Thecoupon auctions under themassprivatization programme werecompleted inJanuary 1996.
More than150PIFspurchased shares, using privatization coupons deposited bycitizens, inatleast
1,700 companies. Sofar,noPIFshaveconverted toJSCs ofopentype. Noregistration/emission
ofshares hastaken place yet.
Currently, therearenoconditions orrestrictions prohibiting foreign investors frompurchasing
shares inPIFsoncetheyareconverted toJSCs ofopentype.
- Agro-industrial complex privatization
Question 10.
Thememorandum notes thattheshares ofprivatized enterprise intheagro- industrial complex
sector, which currently retained bytheState, willbeauctioned toforeign andlocalparticipants.
Mayforeign participants alsopurchase shares, onthesecondary market, from groups thathave
previously received shares intheprivatization ofthese enterprises? What conditions orrestrictions
apply toforeign investors seeking toacquire shares inenterprises intheagro-industrial sector?WT/ACC/KAZ/6/Add.2
Page8
Foreign participants maypurchase shares, onthesecondary market, from groups thathave
previously received shares intheprivatization ofthese enterprises provided thatsuchenterprises are
listed onthesecondary market. Oneexception isthatagricultural producers, whohadprivileges
(received shares inexchange ofliabilities) during thefirstandsecond stage ofprivatization, maynot
selltheirshares toeither foreign ordomestic investors untiltheirliabilities arepaidofftothejoint
stock company.
There arenoconditions orrestrictions other thanaforementioned. Thesame rules apply to
foreign anddomestic investors seeking toacquire shares inenterprises intheagro-industrial sector
through either auctions orsecondary market.
- Third stage privatization
Question 11.
Kazakstan states thatprivatization during thethird stage willbeopentoforeign investors without
limitations. Arecurrent procedure forprivatization made accessible tothepublic? Inwhich
publications cantherelevant procedures canbefound?
Under thethirdstage ofprivatization, thefollowing three types ofprivatization exist:
- small-scale cashauctions tocomplete thesaleofallsmall-scale enterprises;
- cashauctions toselltheremaining State shares inagro-industrial sector andcompanies that
haveundergone mass privatization coupon auctions; and
- case-by-case privatization usually conducted through tender.
Therulesandprocedures governing allthreeprogrammes aredescribed inlawsandregulations
which areavailable from theMinistry ofJustice ortheState Privatization Committee.
Forthcoming cashauctions areadvertised innational massmedia 30dayspriortoauction date.
Theadspecifies thelistofcompanies, terms, andprocedures ofauctions. Inaddition, massive public
education campaign toeducate thepublic about cashauctions wasconducted during December 1995
andJanuary 1996 using mass media means including television.
Theinformation regarding theprocedures andterms ofprivatization foreachcompany subject
tocase-by-caseprivatizationprogrammearepublishedinmajornewspapers(e.g.KazakstanskayaPravda,
Legal Newspapers, ZanJournal).
InformationregardingprivatizationproceduresandauctionsandthesecuritymarketinKazakstan
mayalsobeaccessible through theinternet.
Question 12.
Willforeign investors bepermitted toparticipate intheprivatization ofallenterprises offered
inthethird stage, including theenterprises originally subject tocase-by-case privatization and
enterprises originally subject toagro-industrial complex privatization?
Yes.Foreign investors arepermitted toparticipate intheprivatization ofallenterprises offered
inthethirdstage, including theenterprises originally subject tocase-by-case privatization andenterprises
originally subject toagro-industrial complex privatization.
When State-owned enterprises areprivatized, foreign investors areaccorded national treatment.
Article 2oftheLawOnPrivatization of23December 1995states thatforeign natural andlegalpersonsWT/ACC/KAZ/6/Add.2
Page9
havetherighttobebuyers intheprivatization process likelocalnatural andlegalpersons. Inaddition,
Article 3ofCivil Code of27December 1994 states thatforeign natural andlegalpersons havethe
same rights provided forbythecivillegislation forcitizens andlegal entities ofKazakstan unless
otherwise stipulated bylegislation. Currently, nolegislative actsofKazakstan stipulate discriminatory
treatment concerning foreign participation inprivatization.
Question 13.
Presidential decree having theForce oftheLawNo.2717 OnLand, dated 26December 1995,
permits private landownership inKazakstan. Thelawprovides thatKazakstani legal entities,
whose shares maybewholly-owned byforeigners, nowhave theright toownland. However,
many types oflandplots (including land used foragriculture, defense, natural reserves, and
commonly usedlandinpopulated areas) areexcluded from coverage bythisdecree law. What
percentage ofthetotallandintheRepublic ofKazakstan isavailable forprivate ownership?
Currently, there isnoestimate oftotalavailable landforprivate ownership intheRepublic
ofKazakstan. Alandcadastre isintheprocess ofbeing established andsuchinformation willbe
provided atalaterpoint.
Question 14.
Why doesthedecree lawrequire foreigners toownlandthrough aKazakstani legalentity? Does
theRepublic ofKazakstan intend toallow direct foreign ownership ofland?
Foreign physical andlegalpersons maynotownlanddirectly intheRepublic ofKazakstan.
Inorder toownland, aforeign physical orlegalperson mustfirstform aKazakstani legalperson to
function asalandholding intermediary. Theprincipal policy reason behind thisrequirement isto
ensure thatowners ofKazakstani landaresubject tothejurisdiction oftheRepublic ofKazakstan.
TheRepublic ofKazakstan hasnointention ofchanging thisrequirement inthenearfuture.
Question 15.
Arethere anyrestrictions orconditions applicable toforeign-owned Kazakstan entities investing
inlandthatdonotapply toResident ofKazakstan? Aretheforeign- owned entities forbidden
topurchase anytypes oflandwhich Kazakstan residents arepermitted topurchase?
There arenorestrictions orconditions applicable toforeign-owned Kazakstan legalpersons
investing inland(whether partially or100percentforeign-owned) thatdonotapply equally to
domestically-owned Kazakstan legalpersons. Please note, however, thatbranch andrepresentative
offices offoreign-owned companies arenotconsidered legalpersons forpurposes ofKazakstani law.
Assuch,branchandrepresentativeofficesofforeign-ownedcompaniesmaynotownlandintheRepublic
ofKazakstan.
Question 16.
DoestheGovernment ofKazakstan intend tosellortransfer ownership offarm landorsubsurface
landrights inthenearfuture?
TheGovernment oftheRepublic ofKazakstan doesnotintend tosellortransfer ownership
offarmland (other thanlandplots forpersonal farming) orsubsurface rights.
Question 17.
Does theGovernment ofKazakstan impose anyconditions orrestrictions onforeign enterprises
leasing subsurface rights thatitdoesnotimpose ondomestic enterprises leasing thesubsurfaceWT/ACC/KAZ/6/Add.2
Page10
rights? Areforeign enterprises eligible tolease allsubsurface rights thatareavailable forleasing
bydomestic enterprises?
Foreign physical andlegalpersons maynotleasesubsurface rights intheRepublic ofKazakstan.
There arenorestrictions orconditions applicable toforeign-owned Kazakstan legalpersons (whether
partially or100percentforeign-owned) which areleasing subsurface rights thatdonotapply equally
todomestically-owned Kazakstan legalpersons. Please note, however, thatbranch andrepresentative
offices offoreign-owned companies arenotconsidered legalpersons forpurposes ofKazakstani law.
Assuch, branch andrepresentative offices offoreign-owned companies maynotleasesubsurface rights
intheRepublic ofKazakstan.
(b) Monetary andfiscal policy
Question 18.
Arethere anyconditions orrestrictions ontheoperations offoreign financial service providers,
including banks, which seektoopen branches orsubsidiaries inKazakstan, thatdonotapply
tooperations ofdomestic financial service providers?
Foreign insurance companies areallowed toestablish intheformofrepresentative orbranch
offices butmayonlybeengaged inre-insurance activities. Inorder tobeengaged ininsurance activities,
however, aforeign insurer must form ajoint venture withalocal insurance company. Foreign
participation inthiscasemaynotexceed 50percent. Insurance companies withforeign participation
(maximum 50percent) havethesame rights andprivileges asinsurance companies without foreign
participation.
Foreign banks mayestablish representative orbranch offices butmaynotprovide banking
services until theyareregistered asaKazakstani legal entity which could beupto100percent
foreign-owned. Banks withforeign participation maynotregister inKazakstan ifthetotalregistered
charter fundofallbanks withforeign participation exceeds 25percentoftheoverall registered charter
fundofallbanks inKazakstan.
Banks withforeign participation (partially or100percentforeign-owned) havethesamerights
andprivileges asbanks without foreign participation.
Question 19.
Please describe thenationwide taxupon mineral resources users. Isitconformity withGATT 1994
national treatment provisions applicable tointernal taxation?
TheTaxCode of24April 1995wasamended on31December 1996. PartVIoftheTaxCode
(Taxation ofMineral Production Activities) wastotally replaced. Thenewregime isprovided in
Attachment Atothisdocument.
Themain features ofthisnewregime arethefollowing:
- obligations ofthemineral producer withrespect totaxes andother mandatory payments are
tobedefined inthemineral production agreement between amineral producer andacompetent
authority oftheGovernment ofKazakstan (TheMinistry ofGeology; theMinistry ofOiland
Gas;theMinistry ofIndustry andTrade; ortheMinistry ofEnergy andCoaldepending on
thetypeofmineral resource);WT/ACC/KAZ/6/Add.2
Page11
- priortosigning,anymineralproductionagreementshallundergomandatorytaxappraisalprocess
tobeperformed;
- meeting thetaxobligations under amineral production agreement shallnotbeconstrued as
providing taxrelief withrespect tostatutory taxes onactivities thatfalloutside thescope of
theagreement;
- specific mineral production taxes andpayments comprise: bonuses (bonus onsubscription,
commercial discovery, andextraction), royalties, andexcess profits tax;
- bonuses androyalties maybededucted incomputing taxable income forpurposes ofincome
taxorexcess profits tax;
- depending onthetypeofagreement, mineral production activities shallbetaxed byeither:
- charging them toallstatutory taxes andpayments applicable tomineral
production inKazakstan; or
- requiring themineral producers topayKazakstan itsshare pursuant toa
production sharing scheme andalsopaythefollowing taxes andmandatory
payments: corporate income tax,adjusted forincome taxwithheld atsource
andnetincome taxpayable bythepermanent establishment ofaforeign
company; VAT; bonuses androyalties; incorporation fee;licence fee;andother
taxes envisioned bylegislative actsoftheRepublic ofKazakstan (other than
those mentioned inArticles 3and4oftheTaxCode).
Regardless oftheapplied taxregime, mineral producers shallbeaccorded equal treatment
according toArticle 94-1:4 ofthe31December 1996 Amendments totheTaxCode.
Thetaxationofmineralproductionactivitiesdoesnottreatnationalandforeignmineralproducers
differently andisthusinconformity withthenational treatment provisions ofGATS andGATT 1994.
(c) Foreign exchange, payments system andrelations withtheInternational Monetary Fund
- Foreign exchange
Question 20.
There appear tobetwolawsgoverning foreign currency transaction intheRepublic ofKazakstan,
theLawonCurrency Regulation (TheCurrency Law) andtheRules ofHard Currency Transaction
intheRepublic ofKazakstan, which were issued bytheNational Bank ofKazakstan. The
Memorandum appears tohave given arather complete description oftheCurrency Law, but
itdoesnotappear tohavethedescribed theRules ofHard Currency Transaction. Asaconsequence,
itisnotfullyclear from thedescription inWT/ACC/KAZ/3 astotherequirements andrestrictions
facing importers thatwishtoacquire foreign exchange orfacing others whowishtoacquire foreign
exchange forpayments abroad.
Please provide ageneral description oftherelevant provisions oftherules ofhard currency
transaction, andanyother rules, regulations, andother requirements oftheNBK, applicable
toresidents andnon-residents, involving theexport offoreign currency from Kazakstan fortrade
orother purposes.
AnewLawOnCurrency Regulations wasadopted on24December 1996. Acopy ofthis
newlawisprovided inAttachment A.Newrules forHard Currency Transactions isbeing drafted
andwillsoonreplace theexisting rules.WT/ACC/KAZ/6/Add.2
Page12
Thenewlawprovides thefollowing definitions:
- residents: physical persons whohaveresidence intheRepublic ofKazakstan andKazakstani
legalpersons;
- non-residents: alllegalpersons andphysical persons whoarenotresidents;
- current transactions:
- transfers forconducting settlements forgoods andservices without deferment of
payment;
- performance ofsettlements associated withcrediting export-import transactions for
theperiod notexceeding 180days;
- granting andreceiving loans fortheperiod ofnotmore than180days;
- transfer andreceipt ofdividends, interests, andotherrevenues ondeposits, investments,
loans, andother transactions;
- transfers ofanon-trade nature including grants, transfers ofamounts ofinheritance,
wages, pensions, alimonies, andothers; and
- allother transactions which arenotrecognized bythislawastransactions associated
withmovement ofcapital.
- transactions associated withmovement ofcapital:
- investments;
- transfers topayforproperty oranyother rights withregard toimmoveables;
- performance ofsettlements associated withcrediting export-import transactions for
theperiod ofmore than180days; and
- granting andreceiving loans foraperiod more than180days.
- Authorized Banks: banks having NBK licence toconduct transactions inforeign currency.
Thefollowing provisions fromtheLawonCurrency Regulations of24December 1996concern
export ofcurrency:
1. Residents must obtain alicence from NBK inorder toopen accounts inforeign banks and
financial institutions.
2. Purchase, sale,andexchange offoreign currency inKazakstan shallbecarried outbyresidents
andnon-residents through authorized banks andauthorized non-banking financial institutions.
3. Payments andtransactions between residents andnon-residents shallbecarried outaccording
toagreement oftheparties inanycurrency.
4. Residents mayhaveaccounts inforeign currency inauthorized banks inKazakstan. Foreign
currency received byresidents aspayments forgoods andservices shallbesubject toobligatory inclusion
intotheiraccounts unless itisstipulated otherwise inthelicence obtained fromtheNBK (see1and2
above).
5. ResidentsmayhaveaccountsinthecurrencyoftheRepublicofKazakstanandinforeigncurrency
atforeign banks.
6. International bankpayments andtransfers forcurrent transactions shallbemade byauthorized
banks.
7. Internationalbankpaymentsandtransfersassociatedwithmovementofcapital,usingthecurrency
ofKazakstan andforeign currency, willbeconducted byprocedure established bytheNational Bank.WT/ACC/KAZ/6/Add.2
Page13
Article 3ofthenewlawonCurrency Regulations of24December 1996authorizes thePresident
oftheRepublic toadopt decisions torestrict orsuspend anycurrency transactions forthepurpose of
implementing international obligations andinemergency situations. Inaddition, thesamelawauthorizes
theNBK toestablish restrictions onthecurrency ofpayment ofresidents export operations andthe
regime ofobligatory saleofexport currency receipts.
According totheRules ofHard Currency Transactions (existing rules) issued bytheNBK on
24November 1994 anditsamendments (24January, 18May, and16November 1995; and
29February and30May1996):
- ForeigncurrencybroughtintoKazakstanbynaturalpersons(Kazakstanicitizens,foreigncitizens,
andStateless persons) canbetaken outofKazakstan onthebasis ofcustoms declaration and
without anyrestrictions.
- Residents havetherighttoexport foreign currency intheamount ofUS$10,000 without any
restrictions. Iftheamount exceeds US$10,000, thenresidents must provide adocument
(certificate) from alicensed bank orfrom anauthorized non-banking financial institution
(e.g.exchange bureau) confirming thelegality oftheamount tobeexported.
- Iftheamount exported bynon-residents exceed theamount declared uponentry toKazakstan,
thenthenon-resident mustprovide adocument (certificate) from alicensed bankorfroman
authorized non-banking financial institution (e.g.exchange bureau) confirming thelegality of
theamount tobeexported.
- International bankpayments andtransfers forcurrent transactions andtransactions associated
withmovement ofcapital areperformed byresidents andnon-residents without anyrestrictions
through authorized banks. Residents andnon-residents, however, mustprovide theauthorized
bankwithadocument (e.g.contract, agreement) explaining thepurpose oftransfer/payment.
Suchdocument isusedbytheauthorized banktokeeptrack oftransfers/payments related to
currenttransactionsandtransfersassociatedwithmovementofcapital.Inthecaseoftransactions
associated withmovement ofcapital, simple registration isrequired, inaddition, attheNBK
forstatistical purposes andbalance ofpayment information.
Question 21.
Please describe fullyanydifferences intheprocedures applicable toresidents andnon-residents
whodesire toexport foreign currency.
Please seetheanswer totheabove question.
Question 22.
Doresidents exporting foreign currency needtopresent adocument from alicensed bank orfrom
non-bank exchange bureaus confirming thelegality ofhisreceipt ofamount exported?
Residents exporting foreign currency inexcess ofUSD$10,000 needtopresent adocument
fromalicensed bankorfromalicensed non-bank financial institution (e.g.exchange bureau) confirming
thelegality ofreceipt ofamount exported.
Question 23.
Thecurrency Lawrequires non-resident whointend toexport anamount offoreign currency
fromKazakstan,whichexceedstheamountofforeigncurrencyimportedintoKazakstan,topresentWT/ACC/KAZ/6/Add.2
Page14
adocument from licensed bank orfrom non-bank exchange bureaus confirming thelegality of
hisreceipt oftheamount exported.
AreKazakstanRepublicresidentssimilarlyrequiredtopresentsuchadocumentinordertoconfirm
thelegality ofthereceipt oftheamount offoreign currency tobeexported?
Residents whointend toexport anamount offoreign currency fromKazakstan, which exceeds
theamount offoreign currency imported intoKazakstan, arerequired topresent adocument from a
licensed bankorfromalicensed non-bank financial institution (e.g.exchange bureau) confirming the
legality ofreceipt oftheamount exported.
Question 24.
How doenterprises acquire therights todealinforeign exchange? Canenterprises other than
bank tobeapproved?
TheNBK licence fordealing inforeign exchange isissued tobanks, financial institutions, or
Kazakstani legalpersons solely involved inforeign exchange. Anyenterprise (Kazakstani legalentity)
maybethefounder ofanexchange bureau. However, suchenterprise mustestablish asubsidiary solely
involved inforeign exchange.
Question 25.
Areforeign enterprises eligible tobecome licensed banks orexchange points? Doanyrestrictions
orconditions apply totheoperation oflicensed banks orexchange points byforeign enterprise,
thatdonotapply totheoperation ofthese entities bydomestic enterprises?
Anon-Kazakstani legalorphysical person isnoteligible tobecome alicensed exchange point.
Please note, however, thataKazakstani legal person maybepartially orfully foreign-owned. A
Kazakstani legalperson thatisfullyforeign-owned (referred toasforeign enterprise bytheLawon
Foreign Investment of1994) maybecome alicensed exchange point.
Anybankregistered inKazakstan asaKazakstani legalentity iseligible tobecome anauthorized
bank(licensed bank). Abankregistered inKazakstan asaKazakstani legalperson maybe100percent
foreign-owned. Branch andrepresentative offices offoreign banks arenotallowed todealinforeign
exchange. They must firstregister asaKazakstani legalperson.
Thesame restrictions orconditions which apply totheoperation ofKazakstani legalpersons
withforeign participation (partially orfullyforeign-owned) operating aslicensed banks orexchange
points apply totheoperation ofKazakstani legal persons without foreign participation operating as
licensed banks orexchange points.
Please seetheanswer toquestion No.34below forinformation ongeneral registration
requirements asaKazakstani legalperson.
Question 26.
Kazakstan indicates inWT/ACC/KAZ/3 thatitdoesnotapply anyrestrictions related tothe
international transfers andpayments forcurrent transactions related toservices.
Please describe anyrestrictions applicable tointernational transfers andpayments forcurrent
transactions related togoods.WT/ACC/KAZ/6/Add.2
Page15
Restrictions applicable tointernational transfers andpayments forcurrent transactions related
togoods arethesame asthose related toservices. (seeanswer toquestion No.20above)
(e) Competition policies
Question 27.
TheMemorandum describes competition policies through which existing monopolies and
monopolistic behaviour havebeeneliminated orscaled back during thepasttwoyears, withthe
result that, competition wasdeveloped inmany sectors oftheeconomy.
Please identify anddescribe thesectors thatremain subject tomonopolies ormonopolistic
behaviour. Arethese sectors generally dominated byprivate monopolies orbyState-owned
enterprises? Arethese monopolies conferred bylaw?Ifso,please citethelegalauthority fortheir
status.
Inaddition tothenatural monopolies listed under question 3ofthisdocument, thefollowing
tableliststhesectors which havecompanies considered bytheAnti-Monopoly Committee (AMC) as
having dominant position intheirmarket. Acompany hasadominant position inthemarket, according
totheKazakstani legislation, ifithasmore than35percentmarket share. There are73companies
listed bytheAMC ashaving dominant position inthemarket. Thenumber ofcompanies having
dominant position inthemarket mayincrease ordecrease depending onchanges inmarket share of
entities inKazakstan. TheAnti-Monopoly Committee simply monitor these companies andconduct
periodic market analysis. Please notethatthese 73companies withdominant position inthemarket
arenotconferred bylaw.Most ofthe73companies areproducers. There are32companies inthe
transport sector.
Sector Number &Ownership
Ferrous Metal Industry: manganese concentrate andore; iron-ore,
castiron, pigironofR1,R2,andRS2grades, ironorepellets; and
dolomite.Total: 5companies
Private: 0
State: 0
Mixed (private/State): 2
Contract Management: 3
Non-Ferrous Metal Industry: cathode copper; lead; barite
concentrate; sponge titanium; andmagnesium andmagnesium alloysTotal: 4companies
Private: 0
State: 0
Mixed (private/State): 4
Contract Management: 0
Chemical Industry: sulphate coal; yellow phosphorus; borate ore;
chromium saltandcompound; polystrol; polypropylene; andvinegar
acid100%, grade 92RKTotal: 7companies
Private: 0
State: 1
Mixed (private/State): 6
Contract Management: 0
Machine Building &Metallurgy Industry: cylinders forgas
condensate; tractor piston rings; smith andpress machinery; cardan
shaft; structure andproducts ofaluminum alloys; electric bridge
cranes; small capacity cylinder engines; tractor plough; sowing
machines; reinforced concrete pipes, leadbatteries, bulldozers,
connecting wires, control cable, aerial wire, castironindustrial pipe
fittingsTotal: 14companies
Private: 0
State: 0
Mixed (private/State):
14
Contract Management: 0WT/ACC/KAZ/6/Add.2
Page16
Sector Number &Ownership
Forestry, Wood-Processing, Cellulose-Paper Industry: gypsum Total: 1company
Private: 1
State: 0
Mixed (private/State): 0
Contract Management: 0
Construction Materials Industry: decorative tilesofnatural stones,
gypsum, softroofing, roofing cardboard, reinforced concrete rails,
refractory products, heating cast-iron radiatorsTotal: 8companies
Private: 1
State: 0
Mixed (private/State): 7
Contract Management: 0
Microbiological Industry: Microbiological feeding albumen, including
feeding yeastTotal: 1company
Private: 0
State: 0
Mixed (private/State): 1
Contract Management: 0
Pharmaceutical Industry: aminoacids (lysine), premixes, bacitracin,
andtylosinTotal: 1company
Private: 0
State: 0
Mixed (private/State): 1
Contract Management: 0
Transportation: passenger andmailtransportation, repair and
maintenance ofairplanes, treatment ofagricultural areas by
aeroplane, andcommercial services toaircraft, construction oftraffic
signal facilities, operation ofroadsigns, pedestrian fencing, marking
ofroads, airtreatment ofagricultural areas, railroad transport
services, andaeronavigation/air traffic control services.Total: 32companies
Private: 0
State: 4
Mixed (private/State):
28
Contract Management: 0
Inaddition, theAMC considers ashaving dominant position (more than35percentmarket
share) seven State holding companies which wereestablished in1993 and1994 through Presidential
andGovernmentresolutions.Theseholdingcompanieshavedominantpositioninthefollowingproducts:
aluminum alloystructures andarticles, cardan shafts, small cylinder capacity engines, tractor plough,
sowing machines, bulldozers, reinforced concrete pipes, leadbatteries, ore-mining andreprocessing,
passenger aviation transportation, mailtransportation, andtreatment ofagricultural areas. Some of
the73companies, discussed above, fallunder thestructure ofthese seven State holding companies.
-- Enterprises, whether State-owned orprivate, thathavemonopoly positions ininternational
trade and/or domestic distribution inKazakstan should benotified under Article XVII ofthe
GATT 1994andthe1994Understanding. Kazakstan should complete thequestionnaire inAnnex 6
ofWT/ACC/1 foreachofthese entities fortheproduct theytrade.
There arenoState-owned orprivate enterprises thathavemonopoly ordominant position in
international trade and/or domestic distribution inKazakstan.WT/ACC/KAZ/6/Add.2
Page17
III. FRAMEWORKFORMAKINGANDENFORCINGPOLICIESAFFECTINGFOREIGN
TRADE INGOODS AND TRADE INSERVICES
1. Powers oftheExecutive, Legislative andJuridical Branches ofGovernment
(c) Powers oftheJudiciary
Question 28.
Please describe howcomplaints concerning customs issues arehandled inKazakstan 'scourts.
Inaccordance withtheCode ofCivil Procedure andtheCustoms Code, natural persons who
wish tofileacomplaint concerning acustoms issue haveachoice oflodging aformal complaint
administratively, within theCustoms Office where theoffending decision wasrendered; orjudicially,
atthepeople'scourtwheretheCustomsOfficerenderingtheoffendingdecisionislocated.Inaccordance
withtheCustoms Code andArbitration Procedures Law, juridical persons whowishtofileacomplaint
concerning acustoms issue haveachoice oflodging aformal complaint administratively, within the
Customs Office where theoffending decision wasrendered; orjudicially, attheCommercial Collegium
oftheCourtwheretheCustomsOfficerenderingtheoffendingdecisionislocated.Pleasenote,however,
thattheRepublic ofKazakstan isnowintheprocess ofdrafting anewCode ofAdministrative Violations
which maychange theaforementioned procedure.
Question 29.
Cancustoms decisions beappealed after alladministrative resource intherelevant Ministries
hasbeen exhausted? Ifso,please describe thisprocess.
Please seetheanswer totheprevious question.
Question 30.
Please indicate howcomplaints involving investment issues andintellectual property rights are
addressed, e.g.which courts hearthese andwhat istheright ofappeal?
Complaints involving investment issues orintellectual property rights areaddressed either
administratively orjudicially asanyothercommercial dispute. Iftheinvestment orintellectual property
rightconstitutes aforeign investment forpurposes oftheLawonForeign Investment, moreover, the
foreign investor hastheopportunity totakeadvantage ofthefollowing dispute resolution options as
setforth inArticle 27(b):
(a) tothejudicial bodies oftheRepublic ofKazakstan which areauthorized inaccordance with
thelegislation oftheRepublic ofKazakstan toconsider suchdisputes; or:
(b) oneofthefollowing arbitration bodies:
- totheInternational Centre fortheSettlement ofInvestment Disputes (henceforth, the
Centre), created inaccordance withtheConvention forthesettlement ofinvestment
disputes between theStates andcitizens ofanyother States, opened forsigning in
Washington, onthe18thMarch 1965 (Convention ICSID), provided theStateofthe
investor isasignatory tothatConvention;
- totheAuxiliary establishment oftheCentre (operating under theAuxiliary Agency
Rules), where theState oftheinvestor isnotasignatory oftheICSID Convention;
- toarbitration bodies which areestablished inaccordance withthearbitration regulations
oftheCommission oftheUnited Nations Organization forInternational Trade Law
(UNCITRAL);WT/ACC/KAZ/6/Add.2
Page18
- forarbitration consideration attheArbitration Institute oftheInternational Chamber
ofCommerce inStockholm; or
- totheArbitration commission oftheChamber ofCommerce andIndustry ofthe
Republic ofKazakstan.
Intheevent thataforeign investor doesnotgiveawritten consent totheconsideration ofa
dispute inaccordance withtheprocedure stipulated inparagraph 2ofthisArticle, thedispute may
beentered intojudicial bodies oftheRepublic ofKazakstan which inaccordance withthelegislation
oftheRepublic ofKazakstan areauthorized toconsider suchdisputes.
4. Legislative Programmes orPlans toChange theRegulatory Regime
(a) Agenda fordrafting newlaws
Question 31.
WenotethatKazakstan isintheprocess ofdrafting orredrafting existing lawsinanumber areas
thatwillaffect itsforeign trade regime.
-- WeacknowledgeandencourageKazakstan'suseofWTOAgreementsandthecommitments
contained therein inthedrafting ofchanges toitslegal environment andforeign trade regime,
asperResolution No.211of19February 1996.
-- Kazakstan should givepriority torevision andenactment oflaws addressing WTO
provisions, tofacilitate itsaccession process.
Please giveastatus report onnewandrevised legislation addressing domestic direct taxation (e.g.,
VAT andexcise taxes), thecopyright law,andamendments tothePresidential decree onLicensing.
Since theMemorandum ontheForeign Trade Regime wassubmitted, thefollowing lawsand
amendments tolawswere adopted bytheParliament oftheRepublic ofKazakstan:
- Law OnExport Control over Armaments, Military Equipment andDouble Designation
Production of18June1996;
- LawOnState Duty of31December 1996;
- LawOnBankruptcy of27January 1997;
- Amendments totheTaxCode of31December 1996; and
- LawOnCurrency Regulations of24December 1996.
Thefollowing draftlawsarecurrently being considered bytheParliament:
- Draft LawOnEcological Expertise; and
- Draft LawOnNotary.
ThenewLawonCopyrights andRelated Rights (theCopyright Law) wasactually adopted
on10June1996(prior tothesubmission oftheMemorandum ontheForeign Trade Regime) andwas
discussed insection V.2(a) ofWT/ACC/KAZ/3. Inaddition, acopyoftheCopyright Lawwasprovided
totheWTO Secretariat inAugust 1996.
PleasenotethatthePresidentialDecreeonLicensinghasnotbeenrevisedsincetheMemorandum
ontheForeign Trade Regime ofKazakstan wassubmitted totheWTO.WT/ACC/KAZ/6/Add.2
Page19
AmendmentstotheTaxCodeof24April1995werepassedon31December1996.Amendments
include changes totheVAT, excise, corporate income, property tax,andmineral usetax.Relevant
changes arethefollowing:
- accrual method ofaccounting wasmandated forVAT andCorporate Income Tax;
- VAT credit onimports from CISnolonger permitted;
- excise taxes were introduced tocrude oil;
- excise taxes ongasoline were increased (seetableunder question 47ofthisdocument);
- property taxincreased: legal persons from 0.5percentto1.0percentandnatural persons
(0.1-0.3 percentdepending onthevalue ofproperty); and
- many changes totheregime ofminerals taxation thataffect thesystem ofroyalties, bonuses,
andexcess profits were introduced (please seeAttachment A).
TheGovernment 'slegislative drafting agenda isadopted annually byaGovernment Resolution.
Thelegislative drafting agenda, however, isoften amended ontheproposals ofministries orState
agencies. While formal amendments totheagenda require Government Resolution, deviations from
theagenda willnotpreclude consideration bytheGovernment ofaparticular draftlaw.
Government Resolution No.14of7January 1997 provided anupdated legislative drafting
agenda for1997. Legislation relevant toKazakstan 'sforeign trade regime which arescheduled for
drafting in1997 arethefollowing:
1. Criminal Code
2. Criminal Procedure Code
3. OnAmending theCivil Code-General Part
4. OnPartnerships withLimited Liability
5. OnAmending thePresidential Edict Having theLawForce (i)OnSubsurface Utilization and
(ii)OnOil(asaresult oftheamending theLawoftheRepublic ofKazakstan onForeign
Investments)
6. OnCustoms Authorities
7. OnAmending theLawoftheRepublic ofKazakstan onArchitecture andUrban Planning
8. OnLabour
9. OnAmending theCurrent Legislation Regarding theMechanism ofBorrowers 'Responsibility
andProtection ofInvestors andDepositors
10. Administrative Infractions Code
11. Civil Procedure Code
12. OnIndividual Entrepreneurship (without formation ofalegalentity)
13. OnAdvertising
14. OnAmending theLegislation onFormation ofEconomic andTaxBenefits inMaking
Investments, andontheDevelopment ofSmall andMedium Sized Business
15. OnLegal Profession
16. OnDumping andOnCountervailing Measures
17. OnAmending thePresidential Edict Having theLawForce onState Registration ofRights
inImmovable Property andRelated Transactions
18. OnMinimal Consumer Budget andMinimal Monthly Wages (new version)
19. OnLocal Representative andExecutive Bodies intheRepublic ofKazakstan
20. OnLocal Self-Government
21. OnNatural Monopolies
22. OnConcessions
23. OnState Procurement
24. OnState Participation inFormation andActivities ofEconomic PartnershipWT/ACC/KAZ/6/Add.2
Page20
25. OnLeasing
26. OnAmending theLegislation onPayments fortheSpecial UseofNatural Resources
27. OnJoint Stock Companies
28. OnUnfair Competition
29. OnAmendingthePresidentialEdictHavingtheLawForceonCustomsActivitiesintheRepublic
ofKazakstan (Customs Code)
30. OnRegistration ofSecured Transactions withMovable Property
31. OnAmending thePresidential Edict Having theLawForce onLand
32. OnPayments andSettlements within theRepublic ofKazakstan
33. OnEcological Control
34. OnAmending theLawonStandardization andCertification
Please notethatKazakstan willgivepriority torevisions andenactment oflawsaddressing
WTO provisions.
Question 32.
Werequest thatKazakstan furnish drafts oftherelevant lawstotheWorking Party astheybecome
available andprovide periodic updates ofthestatus ofthelegislation within Parliament.
Kazakstan willprovide periodic updates ofthestatus ofthelegislation within Parliament. A
draftofaspecific relevant lawwillbeprovided upon request byanymember oftheWTO Working
Party.
Question 33.
Does theGovernment ofKazakstan plantopublish drafts ofnew, re-drafted oramended laws
seeking public comment? Ifso,inwhich publications willthedraft lawsappear?
TheGovernment ofKazakstan usually publishes those draftlawswhich havegeneral public
impact (e.g.constitution, special sections ofcivilcode, criminal procedure code). These draftlaws
areusually published inthelegalNewspaper andKazakstanskaya Pravda. Given theneedforKazakstan
tospeed upitslegalreform, thegovernment doesnothaveanycurrent plans topublish atthispoint
alldrafts lawsforpublic comments.
IV. POLICIES AFFECTING TRADE INGOODS
1. Import Regulation
(a) Registration requirements forengaging inimporting
Question 34.
Please describe anygeneral registration requirements forengaging inbusiness inKazakstan, with
special reference toimportation
Anyforeign orKazakstani legalornatural person mayengage inimportation. However, only
Kazakstani legalpersons, individual entrepreneurs registered inKazakstan, andnatural persons who
havepermanent residence inKazakstan maydeclare goods forcommercial purpose. Animporter also
hastheoption toretain alicensed broker todeclare goods forcommercial purposes onitsbehalf.
Natural persons mayimport anytypeofgoods fornon-commercial purpose without registration
requirements.WT/ACC/KAZ/6/Add.2
Page21
According toArticle 12oftheCivilCode, anatural person isdefined asacitizen ofKazakstan,
citizen ofother countries, orStateless person. Anynatural person mayregister asanindividual
entrepreneur withthelocaltaxinspection. Theregistration isautomatic andtheprocess isthesame
forKazakstani citizens andcitizens offoreign countries.
Theregistration procedure andrequirements forKazakstani legalpersons aredefined inthe
LawonState Registration ofLegal Persons of17April 1995, theLawonForeign Investment of
17December 1994, andamendments tobothlawsof15July1996. These twolawswere provided
totheWTO Secretariat inAugust 1996 (seeWT/ACC/KAZ/4).
AKazakstani legalperson maybe100percentKazakstani legal person orKazakstani legal person
withforeign participation (partially orfullyforeign-owned).
Article 9oftheLawonStateRegistration ofLegal Persons mandates thatregistration should
occur within 15daysofreceipt ofalldocuments. Documents required forregistration arethefollowing:
registration application form, charter, confirmation oflocation ofBusiness, statistic card(obtained
fromtheStatistics Committee), proof ofpayment ofregistration duties (0.1percentofCharter Capital),
andproof ofbankdeposit orindependent auditresults. Additional documents ifthefollowing applies:
- ifmore thanonefounder -thereisaneedtosubmit thefoundation agreement andtheprotocol
offoundation meeting;
- ifaState enterprise isafounder -there isaneedtoobtain theapproval ofauthorized body.
Founders ofKazakstani legal persons withforeign participation (partially or100percent
foreign-owned) must:
- submit 3additional documents: bankconfirmation ofsolvency offoreign participant, proof
oflegal status offoreign participant, andcopy ofpassport orother identification document
(only required iftheforeign participant isanindividual);
- register attheCentral Registration Department oftheMinistry ofJustice inAlmaty. Anentity
withnoforeign participation mayregister attheOblast Registration Department oftheMinistry
ofJustice intheOblast where itoperates.
Alldocuments required forregistration must beinKazakstani orRussian languages. All
translated documents andcopies ofdocuments must benotarized.
Denial ofregistration mayoccur under oneofthefollowing twocases:
- incomplete setofrequired documents;
- contradictions withcurrent legislation oftheRepublic ofKazakstan.
According toArticle 11oftheLawonState Registration ofLegal Persons, theMinistry of
Justice Registration Department must provide awritten refusal explaining thereasons fordenial of
registration. Incaseofrefusal ofregistration bytheMinistry ofJustice, documents could berevised
tocomply withnational legislation andresubmitted forconsideration again.
Article 17oftheLawOnStateRegistration ofLegal Persons states thatdisputes between the
founders oflegalpersons andState registration body maybeappealed inthecourt.WT/ACC/KAZ/6/Add.2
Page22
Question 35.
Arethere anyrestrictions orregistration requirements onindividuals engaging inimportation?
There arenorestrictions onindividuals engaging inimportation. Individuals andlegalpersons
havethesame rights andprivileges andaresubject tothesame rulesdescribed inWT/ACC/KAZ/3.
Kazakstani individuals havetherighttodeclare goods forcommercial purpose since theyare
permanent resident ofKazakstan. Inorder todeclare goods forcommercial purpose, foreign individuals
havetheoption toregister asanindividual entrepreneur orretain alicensed broker. Anynatural person
mayregister asanindividual entrepreneur atthetaxinspection office. Theregistration isautomatic
andtheprocess isthesame forKazakstani citizens andcitizens offoreign countries
Natural persons (citizens ofKazakstan, citizens offoreign countries, andstateless persons)
mayimport anytypeofgoods fornon-commercial purpose without registration requirements..
(b) Characteristics ofthenational tariff andnomenclature
Question 36.
Kazakstan 'simport tariff nomenclature isbased ontheCommodity ListofForeign Economic
Activity, patterned after theHarmonized System.
Does Kazakstan intend toconvert fully itsnomenclature totheHarmonized System?
Yes.
Question 37.
Please describe thenature ofthestructural andcoding differences, asnoted intheMemorandum,
between tariff nomenclature ofKazakstan andtheHarmonized System.
Seeresponse tonextquestion.
Question 38.
When willKazakstan incorporate theHS96changes intoitscurrent import tariff nomenclature?
Kazakstan intends toadopt fullytheHarmonized System inApril 1997. Accordingly, any
structural orcoding differences thatmaynowexistbetween HS96andKazakstan 'stariffnomenclature
willhavebeeneliminated bythattime.
(d) Other duties andcharges, specifying anychanges forservices rendered
- Customs Processing Feesandother customs services
Question 39.
ConcerningKazakstan'scustomsProcessingFee:ArticleVIIIofGATT1994statesthatfeesapplied
toimports forcustoms services must belimited totheapproximate costofservices rendered and
shall notindirectly provide protection fordomestic products.
Does Kazakstan haveaprocedure tolimit its0.2percentadvalorem customs processing feeto
anamount notinexcess oftheapproximate costofthecustoms processing service? Isthere are
afeeonprocessing export? How aretherevenues from thisfeeused, e.g., aretheyused only
toprocess allimports, forgeneral customs expenses, oristherevenue sentdirectly togeneral
revenues?WT/ACC/KAZ/6/Add.2
Page23
Kazakstan doesnothaveaprocedure tolimitits0.2percentadvalorem customs processing
feetoanamount notinexcess oftheapproximate costofthecustoms processing service.
A0.2percentfeeapplies alsoforprocessing exports. Therevenue fromimport andexport
processing feesaresentdirectly totheRepublic 'sBudget (General Revenues).
Question 40.
Please explain thenature ofcustoms levies forcustoms accompanying goods within thezoneof
activities ofcustoms administration, listed inTable 4-1.Whyandhowisthislevyapplied totrade
andwhyisafeeof100ECU charged? WhydoesKazakstan usetheECU asitsmeasures ofvalue
forcustoms purposes?
Pursuant toArticle 34oftheCustoms Code, Customs maycontrol thein-transit shipment of
goods byrequiring thataCustoms officer physically accompany thetransport vehicle tothecustoms
office ofdestination. Ifthepoint ofarrival ofthegoods totheRepublic andthedestination point are
within thesame customs region (thesame zoneofactivities), Customs levies afeeof100ECU. If
thecustoms office ofdestination liesoutside thecustoms region inwhich thegoods arrived (outside
thezoneofactivities), thenacustoms officer fromtheregion inwhich thegoods arrived mayaccompany
thegoods tothedestination point. Inthatevent, Customs willlevyafeeof200ECU forthecost
ofthecustoms officer accompanying thegoods tothedestination point. Thefeeisstated inECUbecause
thevalue oftheECUhasbeenmore stable thantheTenge andKazakstan 'sforeign tradeisconsiderable
(20percent) withEUcountries.
-- WeseekKazakstan 'scommitment tobring itscurrent advalorem import processing fee
intolinewithWTO provisions, andaproposals astohowthatshould bedone. Inthisregard,
Kazakstan should address theissues raised inArticles VIIIoftheGATT 1994andinthefindings
oftheGATT 1994 Dispute Settlement panel ontheUnited States 'Customs User Fee.
During accession totheWTO, Kazakstan willbring itscustoms processing feeintolinewith
theGATT 1994; however, theGovernment hasnotyetcompleted aproposal astohowthatwilldone.
Kazakstan willconsider therequirements ofArticle VIIIoftheGATT 1994, aswellasthefindings
oftheGATT 1994Dispute Settlement panel ontheUnited States 'Customs UserFee. Itislikely that
Kazakstan willestablish either afixed feeoranadvalorem feewithaceiling.
Question 41.
Concerning theVehicle Transfer Tax: Please outline more fullythescope andnature ofthevehicle
tax,e.g.,aretransfers ofbothdomestic andimported vehicles taxed?
Government Resolution No.1061 of28August 1996 eliminated thecustoms processing fee
forvehicles transferred bynatural persons (15ECU perunit). Currently, onlytheregular 0.2percent
processing feeapplies forimport ofvehicles.
Please notethattheTaxCode stipulates theimposition ofannual internal taxonvehicles. This
vehicle taxisapplicable tolegalandnatural persons owning vehicles. Thisvehicle taxdoesnotapply
toimports. Article 128oftheTaxCode defines theratesforvehicle tax.AcopyoftheTaxCode
wassubmitted totheWTO Secretariat inAugust 1996 (seeWT/ACC/KAZ/4).
Question 42.
Arevehicles transferred bynatural persons subject toboththe0.2percentadvalorem customs
processing levyand15ECU perunitfee?What istherationale forapplying aspecial feeforvehicle
transferred bynatural persons?WT/ACC/KAZ/6/Add.2
Page24
Government Resolution No.1061 of28August 1996 eliminated thecustoms processing fee
forvehicles transferred bynatural persons (15ECUperunit). Currently, onlytheregular 0.2percent
processing feeapplies forimport ofvehicles.
Question 43.
According toTable 4.1oftheMemorandum, thecustoms levies forcustoms processing thegoods
andvehicles outside designated areas andoutside working hours ofcustoms bodies arelevied
indouble.
Please provide anexample ofasituation inwhich suchalevywould beapplicable. Areallthe
levies provided inTable 4.1subject todoubling, oronlythe0.2percentadvalorem levyand
the15ECU perunitfeeforcustoms processing ofvehicles transferred bynatural persons?
Government Resolution No.1061 of28August 1996 eliminated thecustoms processing fee
forvehicles transferred bynatural persons (15ECU perunit). Currently, onlytheregular 0.2percent
processing feeapplies forimport ofvehicles.
Notalllevies provided inTable 4.1ofWT/ACC/KAZ/3 aresubject todoubling. Only the
0.2percentadvalorem levyissubject todoubling.
Official working hours ofCustoms areMonday through Friday, 0900to1700hours, although
certain customs houses areopen onSaturday from 0900 to1200 hours. Anexample ofasituation
inwhich thecustoms processing feewould bedoubled isifCustoms processed imported goods on
aSunday. Similarly, ifthegoods arecleared byCustoms attheimporter 'sfacility rather thanthe
customs house, thecustoms processing feeislevied indouble.
Question 44.
Please verify thattheamount ofeachcustoms service levyorfeelisted inTable 4.1,other than
advalorem levyandthedoubled levy, doesnotexceed theapproximate costofservices rendered.
Kazakstan cannotverify atthispoint whether ornotfeesspecified inTable 4.1of
WT/ACC/KAZ/3 exceed theapproximate costofservices rendered. Currently, theAnti- Monopoly
Committee isintheprocess ofreviewing allfeescharged forStateservices toensure thattheyreflect
theapproximate costofservices rendered.
- Value Added Tax(VAT)
Question 45.
Themost-favoured national treatment provided byGATT 1994 Article Irequires thatinternal
taxes applied toimports from WTO member should benohigher thanthose applied toimports
from non-WTO sources. TheMemorandum states thatproducts imported from CIScountries
arenotsubject totheVAT atthetimeofimportation.
Please describe anymeasures Kazakstan hastaken toaddress thisproblem andplans forbringing
Kazakstan 'sVAT intoconformity withGATT 1994 m.f.n. requirements.
Withrespect toCIScountries (Agreement between CISCountries onAgreed Principles ofTax
Policy; 13March 1992), VATapplies atsource rather thandestination. Allgoods imported toKazakstan
fromother CIScountries aresubject toVAT inthose countries. Thedifference hereisthatKazakstan
collects theVAT applied ongoods imported fromnon-CIS countries, andother CIScountries collect
theVAT applied ongoods exported toKazakstan fromthose countries. Forthose CIScountries whichWT/ACC/KAZ/6/Add.2
Page25
haveaVAT ratelower thanKazakstan 'srate,Kazakstan applies thedifference inrateonimports from
those countries.
Nevertheless, CIScountries arecurrently intheprocess ofnegotiation regarding making VAT
applicable atdestination rather thansource.
Question 46.
Does theKazakstan Republic rebate VAT taxes onexport (a)toCIScountries; and/or (b)to
other countries?
Kazakstan doesnotrebate VAT taxes onexport toCIScountries butrebates VAT taxes on
export toother countries.
- Excise taxes
Question 47.
Thenational treatment provided byofArticle IIIoftheGATT 1994stipulates thatinternal taxes
onimported goods should benohigher thansuchtaxes ondomestic production. Table 4.2.of
theMemorandum, however, indicates thatthere isaconsiderable disparity intherates ofexcise
taxforseveral imported anddomestic goods
What istheregulatory body which determines andimplements Kazakstan 'sexcise taxes?
Article 76oftheTaxCode (Presidential Decree Having theForce ofLawNo.2235) of
24April 1995anditsamendment of31December 1996define thelistofgoods subject toexcise taxes.
Theratesofexcise taxes areestablished bytheGovernment viagovernment resolutions. TheState
TaxCommittee isresponsible forcollecting excise taxes. Currently Government Resolution No.1747
of31December 1996andNo.1748of31December 1996define theratesofexcise taxes. Thefollowing
tableupdates Table 4.2ofWT/ACC/KAZ/3.
Goods Subject toExcise Tax Domestic Rates Import Rates
1.Allalcohol 3.0ECU/L 3.5ECU/L
2.Liqueurs andvodka products 0.6ECU/L 3.0ECU/L
3.Vodka 0.7ECU/L 3.0ECU/L
4.Fortified drinks, juices andbalsam 0.6ECU/L 3.0ECU/L
5.Wine 0.2ECU/L 0.8ECU/L
6.FineWine 0.2ECU/L 0.8ECU/L
7.Cognac 0.3ECU/L 3.0ECU/L
8.Champagne 0.2ECU/L 0.8ECU/L
9.Beer 0.05ECU/L 0.2ECU/L
10.Wine-making ingredients 0.2ECU/L 0.8ECU/L
11.Tobacco products andother products containing
tobacco0.75ECU per1000
units2.0ECU per1000
units
12.Sturgeon andsalmon, theirroe,anddelicacies
made therefrom100% 100%
13.Gold, platinum orsilver jewellery 40% 40%WT/ACC/KAZ/6/Add.2
Page26
Goods Subject toExcise Tax Domestic Rates Import Rates
14.Cured andnon-cured furskins (except mole,
rabbit, dog,deer, sheep skins)7% 50%
15.Cured andnon-cured furskins ofKarakul 7% 50%
16.Wearing apparel made ofKarakul 10% 50%
17.Coats, short coats, jackets, andmantles with
decoration made from Karakul10% 50%
18.Wearing apparel made ofnatural fur(except
mole, rabbit, dog,deer, sheep)10% 50%
19.Overcoats, short coats, jackets andmantles with
decoration made from fur(except mole, rabbit,
dog,deer, sheep)10% 50%
20.Clothing made ofnatural leather 50% 50%
21.Objects made ofcrystal, including lighting
appliances50% 50%
22.Crude oil 7ECU perton 7ECU perton
23.Diesel fuel 6ECU perton 6ECU perton
24.Gasoline (other thanaviation gasoline) 31ECU perton 31ECU perton
25.Passenger automobiles N/A 10-50%
26.Lorries withacarrying capacity under 1.25ton N/A 15%
27.Oldlorries withacarrying capacity under 1.25
ton(more than10yearold)N/A 30%
28.Firearms andgasweapons (other thanthose for
theneeds ofState agencies)20% 40%
Question 48.
What measures hasKazakstan taken toeliminate thisdiscriminatory treatment, andwhat are
itsplans forbringing itsinternal taxation regime intoconformity withWTO provisions?
Kazakstan hasnotyettaken anymeasures toeliminate thisdiscriminatory treatment. During
accession totheWTO, however, Kazakstan willwork toward bringing itsinternal taxation regime
intoconformity withtheWTO provisions (inlinewiththenational treatment principle oftheWTO).
Question 49.
Areexcise taxes applied toimports from other Republics oftheFormer Soviet Union? Ifnot,
please indicate Kazakstan 'splans forbringing thispractice intoconformity with them.f.n.
provisions ofArticle IoftheGATT 1994?
Withrespect toCIScountries, excise taxes apply atsource rather thandestination. Allgoods
imported toKazakstan from other CIScountries aresubject toexcise taxes inthose countries. The
difference hereisthatKazakstan collects theexcise taxes applied ongoods imported from non-CIS
countries. Other CIScountries collect theexcise taxes applied ongoods exported toKazakstan from
those countries.
Kazakstan plans tobring thispractice intoconformity withthem.f.n. provisions ofArticle I
oftheGATT 1994. CIScountries arecurrently intheprocess ofnegotiation regarding making excise
taxes applicable atdestination rather thansource.WT/ACC/KAZ/6/Add.2
Page27
Question 50.
Does Kazakstan, oranyofitsoblasts orother subcentral authorities apply taxes directly togoods
andservices other thanVAT andexcise taxes? Ifso,please provide information onthese taxes
including theirscope andlevel, andwhether theareapplied tobothdomestic andimported goods.
Neither Kazakstan noranyofitsoblasts orother subcentral authorities apply taxes directly
togoods andservices other thanVAT andexcise taxes.
Question 51.
Please describe thelegal authority ofKazakstan 'ssubcentral authorities tolevytaxes.
Thesubcentral authorities ofKazakstan donothavetheright tointroduce anytaxes. New
taxes mayonlybeintroduced viaadoption ofnewlegislation oramendments totheexisting TaxCode
bythecentral authorities. Thecurrent TaxCode of24April 1995anditsamendments currently permits
subcentral authorities tolevythefollowing taxes: landtax;taxonproperty ofnatural andlegalpersons;
vehicle tax;andthefollowing fees:feeforregistration oflegalpersons, feeforregistration ofnatural
persons engaging inentrepreneurial activities, feeontherighttobeengaged incertain types ofactivities
(activity licence fee),andfeeonauction sales.
(e) Quantitative import restrictions, including prohibitions, quotas andlicensing systems
Question 52.
Pursuant toArticle 20oftheCustoms Code, theRepublic ofKazakstan mayestablish quantitative
import restrictions intheinterest ofhuman, animal andplant health. Please provide additional
information onthispolicy.
Kazakstan hascurrently asystem ofcertification (seesection IV.3(b) andIV.3(c) andAnnex 5
ofWT/ACC/KAZ/3) andasystem ofimport licensing (seesection IV.1(f) andAnnex 3of
WT/ACC/KAZ/3) toprotect human, animal, andplant health. Please notealsothatthesystem of
import licensing isnotlinked toanyquotas. Kazakstan doesnotenvisage using anyother systems
inthefuture including import quotas except incases connected with(i)balance ofpayment problems
andinaccordance withWTO rules and(ii)asanemergency measure according toArticle XIXof
GATT 1994.
Question 53.
Please identify anddescribe anyprovisions ofArticle 20oftheCustoms Code thatarenotin
conformity withtheWTO Agreement ontheapplication ofSanitary andPhytosanitary Measures.
Article 20oftheCustoms Code stipulates thatimport prohibitions maybeintroduced fora
number ofreasons, interalia,toprotect lifeandhealth ofpeople, andtoprotect thenatural environment,
animals andplants. Nomeasures areinforce forthese purposes. Should Kazakstan introduce import
prohibitions forsuchpurposes inthefuture, themeasures would betaken inconformity withthe
provisions oftheAgreement ontheApplication ofSanitary andPhytosanitary Measures.
(f) Import licensing procedures
Question 54.
Does theKazakstan Republic useanyimport licensing procedures toadminister anyagricultural
tariff rates quotas?WT/ACC/KAZ/6/Add.2
Page28
Import licences arenotrequired foragricultural products. Inaddition, therearenotariffrates
quotas foranyproducts.
Question 55.
Aretheadministrative procedures andguidelines fortheKazakstani import licensing system
published andavailable tothepublic? Ifso,inwhat publication cantheprocedures befound?
Theadministrative procedures andguidelines fortheKazakstani import licensing system are
published andavailable tothepublic through:
- theMinistry ofIndustry andTrade (MIT). TheMIThasasetofinstructions regarding import
andexport licensing system which areavailable tothegeneral public forfree. Inaddition,
theMITprovides consultancy services forfreetothegeneral public regarding theprocedure
andrequirements forobtaining import andexport licences;
- occasionally, information regarding theprocedures andrequirements forimport andexport
licences arepublished intheForeign Economic Activity Annex oftheBulletin ofAccounting
which ispublished onamonthly basis.
Question 56.
Does theamount ofthelicensing fee(9200 Tenge) approximate thecostofprocessing theimport
licence?
Theadministrative charge ofTenge 9,200 (20Monthly Evaluation Index) forissuing alicence
isnotcurrently based onthecostofservices rendered (GATT 1994 Article VIII). TheMonthly
Evaluation Index changes onaquarterly basis (please seetheanswer toquestion 114ofdocument
WT/ACC/KAZ/6). Prior toaccession totheWTO, Kazakstan willreview thisadministrative charge
toensure thatitreflects thecostofservices rendered.
(h) Customs valuation
Question 57.
Kazakstan states thatthecustoms valuation system islargely incompliance withtheWTO customs
Valuation agreement.
HasKazakstan provided acopyofitsCustoms Code forWorking Party review? Could wehave
acopy oftheCustoms Valuation provisions?
Yes. Kazakstan hasprovided acopy ofitsCustoms Code forWorking Party review in
August 1996. (seeWT/ACC/KAZ/4)
Thevaluation provisions ofKazakstan 'sCustoms Code aresetoutinArticles 122to133.
Acopyofthevaluation provisions isprovided inAttachment Atothisdocument.
Question 58.
Please describe fullythose areas inwhich Kazakstan 'sCustoms Code isnotincompliance with
theWTO Agreements onCustoms Valuation.
Although thevaluation provisions ofKazakstan 'sCustoms Code largely conform totheWTO
Agreement onCustoms Valuation, there aresome discrepancies andomissions, which aredescribed
below. In1997, Kazakstan willamend itsCustoms Code tobring itfullyintoconformity withthe
WTO Valuation Agreement.WT/ACC/KAZ/6/Add.2
Page29
1. TheCustoms Code defines arelated-party toinclude onethathasmore thana20percent
ownership share intheother party. Article 15(4)(d) oftheWTO Valuation Agreement defines
arelated party toinclude onewhoholds a5percentorgreater share intheother party. In
addition, theWTO Valuation Agreement statement thatarelated party includes "officer or
director ofoneanother 'sbusiness" doesnotappear intheCustoms Code.
2. TheCustoms Code defines "transaction value" astheprice paidorpayable forimported
merchandise "atthemoment oftheircrossing ofthecustoms boundary oftheRepublic of
Kazakstan". This isnotconsistent withtheWTO Valuation Agreement, which defines
transaction value astheprice paidorpayable fortheimported merchandise "when soldfor
export".
3. TheCustoms Code doesnotinclude certain oftheWTO Valuation Agreement provisions on
related-party prices. Specifically, itdoesnotinclude thetwotestssetoutinArticle 1(2)of
theValue Code todetermine whether arelated-party price maybeused asabasis for
appraisement (theuseof"testvalues" andevidence ofthecircumstances ofsale).
4. Article 129oftheCustoms Code, which defines transaction value ofidentical goods, limits
Customs'considerationtoexportsofidenticalgoodsmadewithin90dayspriortotheimportation
ofthegoods under valuation, alimitation thatisnotfound intheWTO Valuation Agreement.
5. Inthecalculation ofdeductive value, theWTO Valuation Agreement, Article 5,requires the
customs authorities toconsider firstthose sales made atorabout thetimethegoods under
appraisement areimported and,onlyifnosuchsalesarefound, consider salesmade within
90daysoftheimportation. TheCustoms Code doesnotmake thisdistinction, butdirects
Customs toconsider allsalesmade within the90-day period inthefirstinstance.
6. Article 2oftheWTO Valuation Agreement provides thatwhere thetransportation-related costs
andcharges described byparagraph 2ofArticle 8areincluded inthetransaction value of
identical orsimilar goods, anadjustment shallbemade totakeaccount ofsignificant differences
insuchcosts andcharges between theimported goods andtheidentical goods arising from
differences indistances andmodes oftransport. TheCustoms Code provides foradjustment
ofallexpenditures described inArticle 128oftheCustoms Code, which includes notjust
transportation-related charges, butassists, royalties, commissions, andother additions toprice
thataredelineated under Article 8oftheWTO Valuation Agreement.
7. Article 4oftheWTO Valuation Agreement provides thatanimporter -athisexclusive option
-mayelecttohavetheimported merchandise appraised under thecomputed value rather than
deductive value, orviceversa. TheCustoms Code doesnotexpressly limitthiselection to
theimporter.
8. Article 132oftheCustoms Code provides thatacomputed value shallinclude anamount for
profit usually derived byexporters insaleofgoods ofthesame typeasthose under valuation.
Itdoesnotinclude thelimitation required byArticle 6oftheWTO Valuation Agreement that
onlyprofits ofexporters inthesame country ofexport aretobeconsidered.
9. Asstated inKazakstan 'sMemorandum onForeign Trade Regime, Article 133oftheCustoms
Code doesnotfullydelineate theprohibitions contained inArticle 7(2)oftheWTO Customs
Valuation Agreement. Specifically, Articles 7(2)(b), (c),(d)and(f)oftheWTO Agreement
onCustoms Valuation arenotincluded intheCustoms Code.WT/ACC/KAZ/6/Add.2
Page30
10. Article 16oftheGATT 1994Valuation Code requires thecustoms bodytoprovide awritten
explanation totheimporter upon written request "astohowcustoms value oftheimporter 's
goods wasdetermined". Article 126oftheKazakstan Customs Code provides instead fora
written explanation ofthereasons whytheimporter 'sdeclared value maynotbeaccepted.
Question 59.
According totheinformation oncustoms valuation provided inAnnex 4oftheMemorandum,
Article 133oftheCustoms Code doesnotfullydelineate theprohibitions contained inArticle 7.2
oftheWTO Customs Valuation Agreement.
WillKazakstan amend theCustoms Code, byprohibiting themethods specified inArticle 7.2(b),
(c),(d),and(f)oftheWTO Agreement onCustoms Valuation?
Yes. In1997, Kazakstan willamend itsCustoms Code tobring itfullyintoconformity with
theWTO Valuation Agreement
Kazakstan states thatitscustoms administration usestransaction value astheprimary basis of
value, except inthecases where customs valuation isreported bySociete deSurveillance (SGS),
itscontracted pre-shipment inspection entity.
-- Pre-shipment inspection entities such asSGSDONOT perform customs valuation. In
accordance withpre-shipment inspection Agreement, these entities perform price verification.
There areveryspecific guidelines onperforming price verification anditisKazakstan 'sobligation
toensure thatSGSfollows thisguidelines.
(j) Pre-shipment inspection
AccordingtotheForeignTradeMemorandum,KazakstancontractedSGStoperformpre-shipment
inspection activities forgoods notbeing imported from CIScountries thatareworth atleast
US$3000.
-- AsaWTO member, Kazakstan willberesponsible forthevaluation, findings andother
actions ofSGSastheyaffect theproper valuation andtreatment ofexports byWTO member
countries toKazakstan.
-- Kazakstan isresponsible forSGS'sadherence totherules ofthePre-shipment Inspection
Agreement. Weencourage Kazakstan tomonitor itscompliance withthese obligations.
Question 60.
What regulations orpolicies ofKazakstan willensure thattheactions ofSGS areproperly
supervised andhowwillresponses tocomplaints andlegalchallenges toSGSfindings behandled?
On31January 1997, Pre-shipment Inspection waseliminated.
Question 61.
Goods thatarebeing imported from CIScountries apparently arenotsubject topre-shipment
inspection. Please indicate howthiswillbealtered prior toaccession inorder tosatisfy GATT 1994
most-favoured-nation requirements.
Please seeresponse totheprevious question.WT/ACC/KAZ/6/Add.2
Page31
(k) Application ofinternal taxes onimports
Question 62.
TheMemorandum states thattheonlyinternal taxes which apply toimported goods aretheValue
Added Tax(VAT) andtheexcise taxmentioned insection (d)above. Earlier, however, inthe
section onFiscal Policy, Kazakstan refers tolocal taxes.
Please listanddescribe allsuchlocaltaxes thatareapplied toimports, andindicate whether these
areapplied equally todomestic andimported goods.
Nolocaltaxes apply toimports.
(l) Rules oforigin
Question 63.
Please identify anddescribe anyprovisions ofKazakstan 'sregulations onrules oforigin thatdo
notconform withtherequirements ofWTO Agreement onRules ofOrigin
Thegeneral rules fordetermination oforigin ofgoods aresetoutinArticles 141to147of
Kazakstan 'sCustoms Code, andarelargely based ontheprinciples ofAnnex D.1oftheKyoto
Convention. Elaboration oftherulesfornon-preferential tradeisfound inthefollowing administrative
orders andregulations:
- Order oftheCustoms Committee No.40concerning theApproval oftheProcedure for
Identifying theCountry ofOrigin ofGoods (3July1995); and
- Resolution oftheHeads oftheCommonwealth ofIndependent States Concerning theRules
forIdentifying theCountry ofOrigin ofGoods (24September 1993), which concerns rules
oforigin forpurposes oftrade among theCIScountries.
Kazakstan 'sorigin regulations donotfullyconform totherequirements oftheWTO Agreement
onRules ofOrigin incertain respects, asfollows:
- TheWTOAgreementprovidesthatincaseswheretheadvalorempercentagecriterionisapplied,
themethod forcalculating thispercentage shallalsobeindicated intherulesoforigin. The
Customs Code andimplementing rulesinclude aruleofadvalorem share,f butdonotdefine
theparticular percentage share orthemethod ofitscalculation.
- TheWTO Agreement states thatwhere thecriterion ofmanufacturing orprocessing operations
isprescribed, theoperation thatconfers origin onthegoodshallbeprecisely specified. The
Customs Code references industrial ortechnological operations thataresufficient toconfer
origin, butdoesnotfurther define theparticular operations thatwillbeconsidered sufficient.
- TheWTO Agreement (i)requires members toissue advance assessments onorigin questions
within 150daysofarequest byanimporter, exporter, oranyother person withajustifiable
cause, (ii)requires thatsuchassessments remain valid foraperiod ofatleastthree years if
thefactsandconditions remain comparable, (iii)requires thatthose rulings bemade publicly
available, and(iv)permits members torevoke anassessment where ajudicial, arbitral, or
administrative tribunal hasissued acontrary decision, provided theparties concerned are
informed inadvance. Articles 376to379oftheCustoms Code provides foraruling procedure,
butlimittheperiod ofvalidity oftheruling tooneyear, donotrequire Customs issuance ofWT/ACC/KAZ/6/Add.2
Page32
theruling within 150daysoftherequest, andpermit Customs tosuspend aruling atanytime,
where itfinds sufficient reason.
(m) Anti-dumping regime
(n) Countervailing dutyregime
(o) Safeguard regime
Question 64.
Please provide acopyofArticle 115and116ofKazakstan 'sCustoms Code totheWorking Party
forreview.
Kazakstan hasprovided acopyofitsCustoms Code totheWTO Secretariat inAugust 1996
(seeWT/ACC/KAZ/4). Article 115and116areprovided inAttachment Atothisdocument.
Question 65.
Please describe fully theprocedures currently ineffect formaking ananti-dumping or
countervailing dutydetermination.
Currently, therearenoprocedures ineffect formaking ananti-dumping orcountervailing duty
determination. Please seeresponse toquestion 67.
Question 66.
TheMemorandum states thatanti-dumping duties must beinproportion tothedegree ofthe
estimated damage todomestic manufacturers ofsimilar ordirectly competing goods.
Isthere aprocedure tolimit theamount oftheanti-dumping duties tothemargin ofdumping,
asprovided forintheAgreement onAntidumping?
Currently, there isnoprocedure tolimittheamount oftheanti-dumping duties tothemargin
ofdumping, asprovided forintheAgreement onAntidumping. Please seeresponse toquestion 67.
Question 67.
When does theGovernment ofKazakstan expect tocomplete thenewprocedural rules and
implementing regulations foranti-dumping andcountervailing duties tofully implement the
provisions oftheWTO Agreements?
Kazakstan hassofarnotimposed anti-dumping orcountervailing duties.
TheCustoms Code of20July1995iscurrently theonlylegislation which refers toantidumping
regime (Article 115)andcountervailing regime (Article 116). Noprocedural rulesorimplementing
regulations havebeendeveloped.
Please notethatKazakstan iscurrently intheprocess ofdrafting alawonAnti-Dumping
Measures andalawonCountervailing Measures. These twolawswillconform totheWTO rules
andwillbetheonlylawsgoverning anti-dumping andcountervailing regime inKazakstan. These laws
areexpected tobesubmitted totheParliament in1997.
Anynecessary procedural rulesandimplementing regulations willbeelaborated afterthelaws
aresubmitted totheParliament.WT/ACC/KAZ/6/Add.2
Page33
Question 68.
TheMemorandum states thatArticle 114oftheCustoms Code provides theuseofspecial purpose
custom duties asaprotection remedy.
What specific laws, regulations andadministrative procedures doesKazakstan intend tonotify
totheWTO foradministering itssafeguard measures?
Kazakstan hasnotsofartaken anysafeguard measures. TheCustoms Code of20July1995
iscurrently theonlylegislation which refers toSafeguard regime (Article 114). Noprocedural rules
orimplementing regulations havebeendeveloped. Please notethatKazakstan iscurrently intheprocess
ofdrafting alawonSafeguard Measures. Thislawwillconform totheWTO rules andwillbethe
onlylawgoverning safeguard regime inKazakstan. Thislawisexpected tobesubmitted tothe
Parliament in1997. Anynecessary procedural rulesandimplementing regulations willbeelaborated
afterthelawissubmitted totheParliament.
Question 69.
What procedures govern safeguard investigations anddeterminations ofinjury? Arethese
procedures published andavailable tothepublic?
Currently, there arenoprocedures governing safeguard investigations anddeterminations of
injury. Such procedures willbeelaborated aftertheLawonSafeguard Measures issubmitted tothe
ParliamentandwillpublishedandavailabletothepublicaftertheLawonSafeguardMeasuresisenacted.
Question 70.
How aresafeguard measures tobeapplied andreviewed?
Safeguard measures willbeapplied andreviewed inconformity withtheWTO Agreement
onSafeguards.
-- Kazakstan willneed tohave inplace allrequired laws, regulations andadministrative
procedures, which should beconsistent withtheprovisions ofWTO Agreements onAntidumping,
Subsidies andCountervailing measures, andSafeguards, prior totaking anysafeguard measures.
2. Export Regulation
(b) Customs tariff nomenclature, types ofduties, dutyrates, weighted averages ofdutyrates
Question 71.
Government Resolution No.810of28June 1996, eliminated export duties forallgoods, except
wheat other thanDurum wheat.
Please explain whytheKazakstan Republic retained anexport dutyonwheat, other thanDurum
wheat. Does Government ofKazakstan intend toeliminate theexport dutyonwheat within the
nearfuture?
Theexport duties applied towheat other thandurum wheat were eliminated on1August 1996.
(c) Quantitative export restrictions, including prohibitions, quotas andlicensing systems
Question 72.
Areforeign entities eligible toobtain ashare oftheoilexport quota? Arethere areanyconditions
andrestrictions applicable toforeign entities thatarenotapplicable todomestic orCISenterprises?WT/ACC/KAZ/6/Add.2
Page34
Foreign entities areeligible toobtain ashare oftheoilexport quota. There arenoconditions
andrestrictions applicable toforeign entities thatarenotapplicable todomestic orCISenterprises.
Question 73.
Please describe theprocess forobtaining ashare oftheoilexport quota. Areanypreferences
granted todomestic orCISentities inawarding theoilexport quotas?
Currently, there isonlyonepipeline (Atyrau-Kazakstan toSamara-Russia) fortheexport of
crude oil.Theamount ofavailable quota forexport ofcrude oilfrom Kazakstan isdetermined on
anannual basis between Russia andKazakstan through anintergovernmental agreement.
Onaquarterly basis, available quotas areallocated bytheMinistry ofEconomy toexporters
ofcrude oilfromKazakstan proportionally totheirproduction. Ifacompany decides toincrease its
production, itshould apply totheMinistry ofEconomy foradditional quota.
Nopreferences aregranted todomestic orCISentities inawarding theoilexport quotas.
(d) Export licensing procedures
Question 74.
Please listallexport tariff categories thathave licensing requirements, byexport classification
lineitem, indicating thereason fortherequirement, anycriteria thatmust befulfilled forexport,
andKazakstan 'sjustification oftherequirement under WTO provisions.
Kazakstan would like,first,toprovide thefollowing amendments toTable A9.1 ofAnnex 9:
1. ThefollowingitemshouldbeaddedtoTableA9.1accordingtoGovernmentResolutionNo.712
of6June1996 onintroduction ofAmendments andAdditions toGovernment Resolution No.298of
12March 1996.
Name ofGoods Code ofCommodity
NomenclatureTheministries and
Departments whose Prior
Approval isRequired
Special technical devices
intended forperformance of
special operative and
investigation efforts, devices
forprotection ofinformation,
other devices ofdouble
application (including parts
thereto, software), instructive
andtechnical documentation
relating tospecial technical
devices (including bothdesign
andmaintenance)8301, 8517, 8518, 8520,
8521, 8525, 8526, 8527,
8528, 8531, 9013, 9022 (only
special technical devices,
devices forprotection of
information andother devices
ofdouble destiny) 8529, 8543
(only forspecial technical
devices)Committee forNational
Security
2. According toGovernment Resolution No.1154 of23September 1996, goods under thetwo
codes 2804 and280540100 arenolonger subject toexport licensing. Atthesame time, thegoods
under thefollowing twocodes became subject toexport licensing: 380450 and380490.WT/ACC/KAZ/6/Add.2
Page35
Inaddition, Kazakstan would liketoaddthefollowing tosection IV.2(c) Quantitative Export
Restrictions, including prohibitions, quotas andlicensing systems:
Government Resolution No.1269 of15October 1996 requires thattheexport of
electro-technical products intheform ofscraps andwaste ofnon-ferrous metals
(aluminum andcopper conductors, power andcommunication cables, starters and
transformers substations elements) isonlypossible afterobtaining thepermission of
theState Inspection onControl ofRational Utilization ofFerrous andNon-Ferrous
Metals.
Table A9.1 precisely describes thegoods subject toexport licensing except forthefollowing:
1. Narcoticsandpsychotropicagents,venoms.GovernmentResolutionNo.1027of19August1996
defines thelistofnarcotics, highly active substances, poisonous substances, andchemical agents subject
tocontrol when exported orimported. Theresolution doesnotspecify thecodes ofsuchgoods.
However, goods subject tocontrol fallunder thefollowing lists:
- listofnarcotics agents according toUnified Conventions onNarcotics Agents of1961;
- listofhighly active substances andlistofpoisonous substances according toUnited Nations
Convention onFight against Illegal Turnover ofNarcotics of1961 and1988;
- listofchemical agents contained inTables IandIIofUnited Nations Convention of1988.
2. Certain types ofrawmaterials, materials, equipment, technologies andscientific technical
information, which maybeusedincreation ofarmaments andcombat equipment. Aprecise listis
currently being defined. Kazakstan willnotify WTO assoonassuchlistisapproved bytheGovernment.
3. Materials, equipment andtechnologies which havepeaceful application butmaybeusedfor
creation ofrocket. nuclear, chemical, andother types ofmass destruction weapons. Aprecise list
iscurrently being defined. Kazakstan willnotify WTO assoon assuchlistisapproved bythe
Government.
4. Service andCivil Armaments. TheLawonState Control forTurnover ofSome Types of
Weapons of27October 1993defines service andcivilarmaments without codenomenclature. Service
armaments arethose armaments used byenterprises, organizations, andestablishments during
implementation oftaskstheyareauthorized toperform suchasprotection oflifeandhealth ofpeople,
property, natural resources aswellasarmaments usedbyParliament deputies andofficials. Civil
armaments arethose armaments forusebycitizens forthepurpose ofselfdefense, hunting andsport.
Civilarmaments aredivided intothefollowing threecategories: (i)gasweapon ofselfdefense, (ii)sport
weapons, and(iii)hunting weapons.
5. Devices forprotection fromcombat poisonous substances, components andaccessories therefor.
Aprecise listiscurrently being defined. Kazakstan willnotify WTO assoonassuchlistisapproved
bytheGovernment.
Export licences arenotlinked toanyquotas. Thefollowing tablesummarizes thereasons behind
export licensing.
Name ofGoods Reasons forExport Licence
1.Pharmaceuticals, medical equipment Medical Safety
2.Pharmaceuticals forveterinary purposes andveterinary
equipmentMedical SafetyWT/ACC/KAZ/6/Add.2
Page36
Name ofGoods Reasons forExport Licence
3.Ivory, horns, hoofs, antlers ofyoung Siberian stag,corals
andsimilar materialsEcological Safety
4.Pharmaceutical rawmaterials ofvegetable andanimal origin Medical Safety
5.Narcotics andpsychotropic agents, venoms Illegal turnover ofnarcotics,
venoms, andpoison agents
6.Information onthesubsurface byregion anddeposit offuel
andenergy andmineral rawmaterials, located intheterritory of
theRepublic ofKazakstan andwithin theboundaries ofthe
continental shelfandmarine economic zone. Collection
materials onmineralogy andpalaeontology (970500000 -only
onmineralogy andpalaeontologyEconomic Safety
7.Certain types ofrawmaterials, materials, equipment,
technologies andscientific-technical information, which maybe
usedincreation ofarmaments andcombat equipmentNational Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
8.Materials, equipment andtechnologies which havepeaceful
application butmaybeusedatcreation ofrocket, nuclear,
chemical andother types ofmass destruction weaponsNational Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
9.Enciphering devices (including enciphering equipment, parts
forenciphering equipment and
software forenciphering), instructive andtechnical
documentation relating toenciphering devices (including both
design andmaintenance)National Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
10.Powder, explosive devices andpyrotechnics National Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
11.Precious natural stones anditems made thereof, waste,
powders andrecovered precious natural stones, pearls anditems
made thereof, amber anditems made thereofEconomic Safety
12.Precious metals, alloys, items made thereof: metals, plated
precious metals anditems made thereof: oresandconcentrated
oresofprecious metals, wastes andscrapEconomic Safety
13.Semi precious stones anditems made thereof Economic Safety
14.Service andcivilarmaments Human SafetyWT/ACC/KAZ/6/Add.2
Page37
Name ofGoods Reasons forExport Licence
15.Devices forprotection from combat poisonous substances,
components andaccessories thereforNational Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
16.Instructive documentation relating toproducts ofmilitary
designation (design andoperation)National Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
17.Special technical devices intended forperformance of
special operative andinvestigation efforts, devices forprotection
ofinformation, other devices ofdouble application (including
parts thereto, software), instructive andtechnical documentation
relating tospecial technical devices (including bothdesign and
maintenance)National Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
18.Raremetals, rare-earth metals, rawmaterials for
manufacture, alloys, compounds anditems made
thereofEconomic Safety
Names ofgoods Reasons forPermission of
theGovernment
19.Wild animals, wildplants Ecological Safety
20.Armaments andmilitary equipment, special components for
theirmanufacture, works and
services inthesphere ofmilitary technology collaborationNational Security andin
accordance withtheLawon
Export Control of
Armaments, Military
Equipment andProduct of
Dual Use
21.Nuclear materials, technologies, equipment andinstallations,
special non-nuclear materials,
sources ofradioactive radiation, including radioactive wasteInternational Obligations
agreement on
Non-Proliferation ofNuclear
Armaments 1993
Thereasons forrequiring permission toexport electro-technical products intheformofscraps
andwaste ofnon-ferrous metals (aluminum andcopper conductors, power andcommunication cables,
starters andtransformers substations elements) arethefollowing:
- provide safety ofvitally important objects ofenergy communications andindustrial enterprises;
and
- prevent misappropriation ofnon-ferrous metals, scrap andwastes anddeplenishment of
equipment containing non-ferrous metal units.WT/ACC/KAZ/6/Add.2
Page38
(e) Other measures, e.g.minimum export prices, voluntary export restrictions, orderly
marketing arrangements.
Question 75.
GATT 1994Article XIonQuantitative Restrictions doesnotpermit prohibitions orrestrictions,
other thanduties, taxes orother charges, ontheexportation orsaleforexport ofanyproducts
destined fortheterritory ofanother WTO Member.
Areallproducts listed inTable A9.3 (subject tocontact registration pursuant toGovernment
Resolutions 1035 and304)subject tominimum export pricing? Please identify allproducts,
including HSnumbers, subject tominimum export pricing.
Government Resolution No.1492 of5December 1996 eliminated minimum export prices.
Question 76.
Please discuss anddescribe thereason forthissystem anditsconsistency withWTO provisions
relating toquantitative restrictions.
Please seeanswer toprevious question.
(f) Export financing, subsidy andpromotion policies
TheKazakstan Republic doesnotappear tohave anypolicies ormeasures tofinance exports.
-- Because export subsidies arethemost trade distorting forms ofsupport, westrongly
encourage youtocommit tobinding export subsidies atzeroforallproducts.
Question 77.
HowdoKazakstan 'splans toprovide preferential credits focusing onexport orimport substitution
conform with provisions ofArticle 3oftheSubsidies andCountervailing Measures (SCM)
Agreement?
Kazakstan 'ssystem ofpreferential credits focusing onexport orimport substitution donot
conform withtheprovisions ofArticle 3oftheSubsidies andCountervailing Measures (SCM)
Agreement. However, Kazakstan plans togradually eliminate suchsubsidies inaccordance with
Article 29oftheSCM Agreement.
Question 78.
Please describe inmore detail thegovernment 'splans toprovide preferential credits tosmall and
medium-sized industrial enterprises.
Theprinciples forsupporting small andmedium-size businesses through preferential credits
isdescribed inGovernment Resolution onarranging aCompetitive Selection ofQuick- Paying Back
Investment Projects, HeldbytheGovernment oftheRepublic ofKazakstan in1996dated 13June1996.
Inaccordance withthisResolution, tenders willbeheldforselecting highly efficient and
quick-paying backprojects oriented atimport substitution andexports. According tothisResolution,
anInterdepartmental Commission forevaluating andselecting investment projects under theMinistry
ofEconomy wasestablished. Theregulations forArranging andHolding aCompetitive Selection as
wellasFunding Quick-Paying BackInvestment Projects wereapproved. These Regulations stipulate
conditions ofarranging andholding bids;rights andresponsibilities ofbanks andtheInterdepartmentalWT/ACC/KAZ/6/Add.2
Page39
Commission forevaluating andselecting investment projects; rights andresponsibilities ofbidders;
basicrequirements toproject documentation; procedure forconsidering proposed projects andsumming
uptheresults ofbids, andprocedure andconditions offunding projects.
(h) Import dutydrawback schemes
Question 79.
Please conform thattherebate ofthevalue ofimport duties inputs toprocessed exports doesnot
exceed thevalue oftheduties paidonimported inputs tophysically incorporated intheexport,
anddoesnotinclude thevalue ofduties paidonmachinery usedinprocessing. Ifthisisnotthe
case, please describe theactual regime.
Weconfirm thattherefund ofthevalue ofduties paidonimported merchandise usedasinputs
inexported merchandise islimited tothevalue ofduties paidontheinputs physically incorporated
intheexported merchandise, anddoesnotinclude thevalue ofduties paidonmachinery usedinthe
processing.
3. Internal Policies Affecting Foreign Trade inGoods
(a) Industrial policy, including subsidy policies
- Agricultural subsidies
Wearestillreviewing Annex 11onAgricultural Subsidies andwewillprovide questions and
comments onitscontents prior toKazakstan assoonaspossible, andbefore thefirstWorking
Party Meeting.
Question 80.
TheKazakstan Republic 'sdomestic agricultural support regime isbriefly summarized inthe
Memorandum asasystem ofdirect subsidies, credits, loanguarantees anddebtrescheduling.
Intheregard tooperation oftheAgricultural Support Fund (ASF), please provide further details
onhowthese ASFsubsidies arepaidtofarmers. Arepayment levels linked toproduction and/or
prices, oraretheydecoupled from price orproduction levels?
Subsidies aregranted through theAgriculture Support Fund (ASF), established in
December 1994. Themain goalofproviding subsidies toagricultural production through thisASF
istoincrease efficiency ofagricultural activities bymeans ofstimulating entities tousenewequipment,
technologies, purchasing ofpedigree cattle, usage ofhighgrade seeds, mineral fertilizer andmeans
toprotect plants. Subsidies arenotintheform ofprice support.
In1996, theASFallocated resources toagricultural entities according tothefollowing:
- 50percentofvalue ofusedmineral fertilizer forcrops ofintensive typeandseeds plots of
grain crops;
- 40-60 percentofvalue ofusedplant protection means (e.g.herbicides);
- certain subsidies topayforusedfuelandmixed fodder, andmeasures toimprove health of
cattle;
- certain subsidies foradopting newtechnologies andtraining onusage ofnewequipment; and
- afixed amount ofsubsidy foreachtonofproduction ofhighgrade seeds, pedigree cattle, high
quality wool andastrakhan, andlamb meat.WT/ACC/KAZ/6/Add.2
Page40
Theallocation ofsubsidies isprovided through Oblast branches ofASFwhich alsoperforms
control overear-marked usage ofallocated subsidies.
Question 81.
Please provide additional details describing theoperation andadministration oftheprogrammes
forcredits, loanguarantees anddebtrescheduling.
Preferential credits through theState Eximbank, State guarantees forforeign loans, and
preferentialloans(throughtheFundforAgriculturalSmallandMedium-SizeBusinessesSupportextended
onacompetitive basis) areusedtosubsidize theagricultural sector. Suchtoolsareusedtostrengthen
reforms intheagricultural sector andimplement asingle medium-term investment policy. Major criteria
forcompetitive selection arecompliance ofinvestment projects withrestructuring goalsintheagriculture
sector, creation ofcompetitive markets foragricultural commodities, usage ofmodern machinery and
technologies, andeconomic soundness ofprojects.
In1994-1996 preferential credits through Eximbank were extended toover150companies,
Stateguarantees forforeign loans -toover10agricultural entities andprocessing industry companies.
Preferential loans andcredits toleaseagricultural machinery aregiven inaccordance withthe
ADB Programme Loan fortheagricultural sector. In1996, 91projects were selected outofmore
than300proposed investment projects. Selected projects include projects forproducing flour, macaroni,
meatandmilkprocessing andbread baking.
Subsidization oftheagricultural sector wasalsoprovided intheformofarrears rescheduling.
TheFund forAgriculture Support setupinDecember 1994 assumed debts ofagricultural producers
intheamount ofoverUS$500 Million onthebasis ofindividual agreements which stipulated the
procedure, timing andconditions ofrepayment.
Apart fromthat,thedebtofagricultural producers forconsumed power andpetroleum products
wasforgiven fortheperiod 1995-1996.
Question 82.
Thepreferential railroad transport tariff rates available tolocally produced coal, agriculture and
foodproducts appear toviolate GATT 1994 national treatment requirements.
DoesKazakstanintendtomakethepreferentialrailroadtransporttariffratesavailabletoimported,
aswellasdomestically-produced, coal, agriculture andfoodproducts?
Preferential tariffratesfortransportation ofcoalandagriculture andfoodproducts byrailwere
eliminated on1January 1997 according toResolution No.7/126 oftheState Committee onPricing
andAnti-Monopoly Policy dated 25December 1996.
- Non-agricultural subsidies
Question 83.
Please describe theprogramme criteria forregional subsidies (i.e.,what aretheeligibility criteria
foroblast?). Which oblasts receive suchsubsidies? Areoblast authorities provided withobjective
criteria andguidelines foradministrating regional subsidies?
Themaineligibility criterion foranoblast toreceive regional subsidies islower levelofincome
percapita than average national levelofincome percapita.WT/ACC/KAZ/6/Add.2
Page41
In1996, thefollowing oblasts received atotalamount ofUS$298.8 Million:
Almaty Oblast US$44.4 Million
EastKazakstan US$2.77 Million
Kzyl-Orda US$59.13 Million
Kokshetau US$20.45 Million
North Kazakstan US$13.67 Million
Semipalatinsk US$28.21 Million
South Kazakstan US$29.22 Million
Taldykorgan US$38.25 Million
Turgai US$16.5 Million
Zhambyl US$30.75 Million
West Kazakstan US$15.44 Million
Currently,oblastauthoritiesareprovidedwithobjectivecriteriaandguidelinesforadministratingregional
subsidies andnolonger havediscretion indistributing suchsubsidies.
Question 84.
Please describe more fullythesubsidies listed inTable 4.3oftheMemorandum, withparticular
reference totheGovernment entities providing theassistance. Please identify thesectors receiving
theindustrial subsidies andcriteria foreligibility.
Preferential internal loans through theStateEximbank andStateguarantees forforeign loans
areusedtostrengthen reforms andimplement asingle medium-term investment policy. Such loans
cover allindustries. Themain selection criteria aremeeting themain objectives ofpriority sectors
ofeconomy andeconomic soundness ofprojects. In1995-1996:
- preferential internal loans through Eximbank wereextended tocompanies operating inpower
engineering, metallurgy, machine-building industry, lightindustry andconstruction materials
industry;
- Stateguaranteesforforeignloanswereextendedtocompaniesoperatinginconstructionindustry,
mining industry andmetallurgy.
Preferential loans through theStateRehabilitation Bank maycover allindustries. Thebasic objective
ofthese loans isfinancial recovery ofnon-viable companies andpreparation ofcompanies for
privatization andmanagement contracts. Selection ofcompanies forsuchloans isbased ontheamount
ofaccountspayableandtheavailabilityofspecificrestructuringprogrammeinthecompany(e.g.product
re-orientation; divestiture ofinefficient units--social assets etc.). In1995-1996 suchloanswereextended
tocompanies operating inmachine building, chemical industry, mining industry (coal production),
rubber-technical items production andmetallurgy.
Inaddition, taking intoaccount thefinancial situation ofcertain companies, theGovernment
issued special resolutions deferring andforgiving debtandrescheduling arrears ofthese companies.
In1995-1996 such subsidies were given tocompanies operating inmetallurgy, coalproduction,
machine-building industry andpharmaceuticals production.
In1996, preferential loans were alsoextended todevelop exports andimport substitution to
companies operating incoalproduction andlightindustry. Preferential loans werealsoprovided to
supporthighlyefficientandhighreturninvestmentprojectsofsmallandmedium-sizebusinessesoriented
toimport substitution andexport.WT/ACC/KAZ/6/Add.2
Page42
(b) Technical regulations andstandards, including measures taken attheborder withrespect
toimports
Question 85.
Kazakstan states thatGosStandard isresponsible forenforcing theLawonStandardization and
Certification.
Arethere regulations oradministrative procedures which provide guidance toGosStandard, or
other agencies, topublish draft standards forcomment? Isthere guidance onarecommended
period toallow forpublic comment?
Inconformity withtherequirements oftheState standardization system oftheRepublic of
Kazakstan (STRK1.2-93 SSS.Procedure ofState Standards Development), draftstandards shallbe
senttoallconcerned organizations fortheircomments andrecommendations. Draft standards arealso
published inmass media andinspecial bulletin news ofGosStandard.
Comments ondraft standards should beprovided within onemonth from thedateoftheir
circulation orpublication. GosStandard approves newstandards andamendments toexisting taking
intoaccounts comments ofconcerned parties.
Question 86.
Inwhat publications areKazakstani rules andregulations related tostandardization and
certification publicly available?
Newly adopted general rulesandnorms related tostandardization andcertification arepublished
inmass media andthebulletin news ofGosStandard. Therules andnorms connected withspecific
group ofproducts orsphere ofactivity arepublished asshort annotation innews ofGosStandard.
Detail onsuchrules andnorms aresenttoallconcerned organizations.
Rules andregulations arealsoavailable asindependent publications anddistributed ondemand
toconcerned organizations andnatural persons.
Question 87.
TheMemorandum notes thatKazakstan Republic intends toharmonize itsstandard with
international standards.
Please describe specific steps under waytoharmonize Kazakstani standards withinternational
standards andtechnical regulations.
Kazakstan isamember oftheInternational Organization forStandardization (ISO) andthe
International Organization forLegal Metrology (IOLM). Kazakstan receives standards and
recommendations from these twoorganizations andtakes intoaccount their requirements during
development ofnewstandards andrevision ofexisting ones.
Oneofthemain principles oftheState standardization system oftheRepublic ofKazakstan
(STRK1.0-9333 SSS.General provisions) istotakeintoaccount therequirements ofinternational
andregional standards when developing newstandards.
TheInquiry-Information fundhasbeenestablished. Itcurrently possess about fivethousands
international, regional, andnational standards ofindustrially developed foreign countries. Kazakstan
iscontinuously working toward expanding thisInquiry-Information fund.WT/ACC/KAZ/6/Add.2
Page43
Question 88.
What guidance hasbeenprovided toGosStandard andother Kazakstani agencies requiring the
useofappropriate international standards?
Article 10oftheLawofOnstandardization andCertification permits Kazakstani manufacturers
toapply directly international, regional andnational standards, andstandards offoreign countries,
iftheydon'tcontradict current State standards.
Prime Minister Order No.593-p of31December 1996 requested GosStandard tosubmit
proposals onharmonization ofstandards taking intoaccount international requirements.
Regarding information ondraft standards:
Question 89.
Dothepublications News ofGosStandard andtheInformation Handbook ofKazakstan Standards
provide announcements foralldraft standards, technical regulations andconformity assessment
procedures, sothatinterested parties mayprovide comments?
Currently,NewsofGosStandardprovidesannouncementsforthemostimportantdraftstandards
andconformity assessment procedures sothatinterested parties mayprovide comments.
Draft ofallstandards andconformity assessment procedures areprovided directly tointerested
parties forcomments.
Question 90.
Inwhat specific publications arefinalstandards, technical regulations andconformity assessment
procedures published?
Approvedstandards(includingconformityassessmentprocedures)areproducedbyGosStandard
asseparate publications. These documents aredistributed upon request toconcerned organizations
andnatural persons. They arealsosoldatspecial shops throughout Kazakstan.
Technical regulations areusually produced asseparate publications bythedeveloper andmay
onlybeobtained from thedeveloper. Technical regulations aresimply registered atGosStandard.
Bibliographical information regarding standards andtechnical regulations arepublished in
InformationIndicatorsBulletinandInformationhandbookofKazakstanStandardsissuedbyGosStandard.
Question 91.
Concerning Kazakstan 'sregime forthedetermination ofconformity ofimports withdomestic
standards requirements:
Under whatconditions isacertificate ofconformity required forimports? What isthefeestructure
andwhat criteria areapplied?
Government Resolution No.411provides thelistofallproduct categories requiring acertificate
ofconformity. Suchlistcanbefound inAnnex 5ofWT/ACC/KAZ/3 andapplies equally todomestic
andimported products. Certificate ofconformity maybeobtained from anydomestic orforeign
certification body accredited byGosStandard.WT/ACC/KAZ/6/Add.2
Page44
Certificates issued bycertification bodies ofotherCISCountries andother foreign certification
bodies accredited byGosStandard must beconverted toKazakstani certificates. Thisconversion is
automatic andthefeecharged isapproximately US$5.
Prices aresetfreebycertification bodies andreflect thecostoftesting andprocessing.
Question 92.
Does Kazakstan accept certification from internationally recognized standard authorities other
thanthedesignated national andother certification bodies ithasrecognized?
Kazakstan doesnotaccept certification from internationally recognized standard authorities
other thanthedesignated national andother certification bodies ithasrecognized.
AccordingtotheCISInterStateAgreementonStandards,Metrology,andCertification,Kazakstan
honours certificates provided byStatecertification bodies ofArmenia, Azerbaijan, Belarus, Georgia,
Kyrgyzstan, Moldova, theRussian Federation, Tajikistan, Turkmenistan, Ukraine, andUzbekistan.
Inaddition, there arefourforeign companies accredited byGosStandard toissue certificates: Gasde
France, France; MertControl, Hungary; Societe Generale deSurveillance (SGS), Switzerland; and
Turkish Institute ofStandards, Turkey. GosStandard has19regional bodies (oneineachofthe19oblasts
ofKazakstan). Thirteen ofthese regional bodies areaccredited toprovide certification. Anyforeign
entity mayapply foraccreditation.
Question 93.
Does Kazakstan recognize anyexternal regional orinternational standards? Hasitidentified any
equivalencies between standards inKazakstan andthese external standards? Ifso,which ones:
ISO? MEK? ASME? API? CE?Others?
TheLawOnStandardization andCertification stipulates thedirect application ofinternational
standards bymanufacturers, iftheirrequirements donotcontradict thecurrent standards ofKazakstan.
Thenormative actontheorder ofapplication ofinternational standards hasbeenadopted.
Kazakstan recognizes CISInterState GOST Standards. Inaddition, Kazakstan isamember
ofISOandIOLM. Newly developed orrevised Kazakstani standards areauthentically translated or
takeintoaccount therequirements ofISOandIEC.
Kazakstan hasnotyetdetermined equivalencies between standards inKazakstan andexternal
standards suchasASME, API,CE,andothers.
(c) Sanitary andphytosanitary measures, including measures taken withrespect toimports.
Question 94.
IsKazakstan prepared tofullyimplement theprovisions oftheprovisions oftheWTO Agreement
onSanitaryandPhytosanitaryMeasures,includingtheproceduralandtransparencyrequirements?
Kazakstan anticipates difficulties inapplying theSPSAgreement infullupon accession and
willneed anadjustment period tobring domestic rules andsanitary-hygiene norms inlinewith
internationalstandards.However,proceduralandtransparencyrequirementsaspectsmaybeimplemented
upon accession.WT/ACC/KAZ/6/Add.2
Page45
(d) Trade-related investment measures
Question 95.
Please describe thecommitments placed onforeign investors bytheLawOnOilandtheLaw
OnSubsurface Utilization thatrequire investors tomake purchases ofdomestic goods.
TheLawOnSubsurface Utilization andtheLawOnOilrequire investors intheoil,gas,and
mining sectors togivepreferences toKazakstani goods andequipment. However, noimplementing
regulationshaveyetbeenenacteddetailingthenatureofsuchrequirementorthemechanismforenforcing
it.
Kazakstan understands thattherequirements concerning preferences forlocalproducts inthe
LawonOilandtheLawonSubsurface Utilization arenotconsistent withArticle III:4ofGATT 1994
which requires thatimported products shallbeaccorded treatment nolessfavourable thanthataccorded
tolikeproducts ofnational origin inrespect ofalllaws, regulations andrequirements affecting their
internal sale,offering forsale,purchase, transportation, distribution, orus.
Kazakstan alsounderstands thattherequirements intheLawOnOilandtheLawOnSubsurface
Utilization arealsocontrary toprovisions ofparagraph 1(c)oftheAnnex totheTRIMs Agreement
thatprohibits measures thatrequire thepurchase orusebyanenterprise ofproducts ofdomestic origin
orfrom anydomestic source, whether specified interms ofparticular products, interms ofvolume
orvalue ofproducts, orinterms ofaproportion ofvolume orvalue ofitslocalproduction.
-- Kazakstan should eliminate measures inconsistent withtheTRIMS Agreement including
local purchases preference investment requirements.
(e) State-trading practices
Question 96.
Kazakstan notes inAnnex 6thatgovernment authorized companies haveexclusive rights totrade
innuclear-related materials andprecious metals.
Please prepare aresponse totheQuestionnaire onState trading describing each ofthese
government-owned companies andanyother Kazakstan entity, whether ornotState owned, that
hasdesignated trading ordistribution rights.
Kazakstan doesnotmaintain enterprises covered bytheprovisions ofArticle XVII andthe
understanding ontheinterpretation ofArticle XVII ofGATT 1994. TheGovernment ofKazakstan
doesnotgrant toanyprivate orStateenterprise, including marketing boards, exclusive orspecial rights
orprivileges,includingstatutoryorconstitutionalpowers,intheexerciseofwhichtheyinfluencethrough
theirpurchases orsalesthelevelordirection ofimports orexports. Stateandprivate tradeenterprises
operate inanon-discriminatory andcompetitive market environment. There arenoState orprivate
owned companies thathasdesignated trading ordistribution rights. Currently, therearenocompanies
withexclusive rights trading inprecious metals, nuclear- andmilitary-related equipment.
(f) Freezones
Question 97.
Why does theKazakstan Republic prohibit direct foreign investment, without theuseofa
Kazakstan legal entity, within thefreezones orfreewarehouses?WT/ACC/KAZ/6/Add.2
Page46
TheCustoms Code issilent onwhether ornotforeign direct investment ispermitted, without
theuseofaKazakstani legalentity, within thefreezones orfreewarehouses. Article 74oftheCustoms
Code, however, authorizes theCustoms Committee toprohibit certain persons from performing
operations within thefreezones andfreewarehouses. Order No.85-pofCustoms Committee of
19April 1996 stated thatalloperations withgoods andvehicles within afreewarehouse canonlybe
performed bytheowner ofthefreewarehouse.
Article 78oftheCustoms Code addresses ownership offreewarehouses. Only Kazakstani
persons mayownfreewarehouses. Kazakstani persons include:
- Kazakstani legalpersons. Thisincludes Kazakstani legalpersons withforeign participation
(partially orfullyforeign-owned);
- Branch andrepresentative offices ofKazakstani legalpersons;
- Individual entrepreneurs registered intheRepublic ofKazakstan (aforeign citizen mayregister
asanentrepreneur inKazakstan);
- natural persons (Kazakstani citizens, foreign citizens, andstateless persons) having permanent
residence intheRepublic ofKazakstan.
Aforeign investor mayestablish a100percentforeign-owned Kazakstani legalentity through
registration attheMinistry ofJustice. Theregistration process isautomatic provided thatallrequired
documents aresubmitted (seetheanswer toquestion 34ofthisdocument)
Theprincipal policy reason behind requiring theuseofaKazakstani legalentity istoensure
thatowners offreewarehouses aresubject tothejurisdiction oftheRepublic ofKazakstan.
(g) Freeeconomic zones
Question 98.
Chapter 12oftheKazakstan Customs Code envisages thecreation offreecustoms zones andfree
warehouses which willbetreated asbeing outside thecustoms territories ofKazakstan. The
Memorandum states, however, thatlegalentities inthespecial economic zones aresubject tothe
taxation, registration andlicensing legislation oftheRepublic ofKazakstan.
Please provide acopyofthisChapter totheWorking Party andelaborate ontheforeseen conditions
forfirms inKazakstan thatareestablished inthese zones. Areexport requirements specified?
Iffirms donotrealize exports tothesatisfaction oftheestablishing authority inthezones, will
thezonebecancelled?
AcopyofChapter 12oftheCustoms Code andoftheDecree ofPresident No.2823onSpecial
Economic Zones intheRepublic ofKazakstan of26January 1996 areprovided inAttachment A.
TheCustoms Code andDecree No.2893werealsoprovided totheWTO Secretariat inAugust 1996
(seeWT/ACC/KAZ/4).
Chapter 12oftheCustoms Code andOrder No.85-p:
According toArticle 74oftheCustoms Code, production andanycommercial operations
involving goods, except retail trade, arepermitted infreewarehouses. Alicence toestablish afree
warehouse must beobtained from theCustoms Committee.
TheCustoms Code doesnotimpose anyexport requirements onowners offreewarehouses.WT/ACC/KAZ/6/Add.2
Page47
When importing foreign andKazakstani goods intotheterritory ofthefreezones orplacing
infreewarehouses, customs duties andtaxes shallnotbelevied.
When importing goods fromtheterritory offreezones andfreewarehouses totherestofthe
customs territory ofKazakstan andwhen exporting goods from theterritory offreezones andfree
warehouses beyond theboundaries ofKazakstan, customs duties andtaxesshallbelevied. Please note
thatnoexport duties arecurrently inforce inKazakstan.
Foreign goods exported fromfreewarehouses totheterritory ofKazakstan aresubject tothe
same duties andtaxes asforeign goods imported totheterritory ofKazakstan.
Special (Free) Economic Zone:
TheDecree ofthePresident onSpecial Economic Zones stipulates thatspecial economic zones
areestablished inorder toaccelerate theeconomic development andintegration intotheworld economy
ofcertain regions ofthecountry. Thisshould beachieved, interalia,through thecreation ofhighly
efficient export oriented production, theattraction ofinvestments, andtheintroduction ofmodern
management methods andsocial norms. Current legislation doesnotimpose export requirements on
companies operating infreeeconomic zones.
Special economic zones areestablished foraspecific period oftimebyPresidential Decree
andmaybeabolished prematurely byPresidential Decree iftheydonotachieve thepurpose forwhich
theywereestablished. TheChairman oftheAdministrative Council oftheEconomic zones isappointed
anddismissed bythePresident. Theadministrative authority inthespecial economic zones enjoys
considerable degree ofautonomy andisfinanced bytaxes andfeespaidbylegalentities andnatural
persons registered intheterritory ofthespecial economic zone.
Incaseofchanges inthelegalregime ofthespecial economic zoneorpremature abolishment
ofthespecial economic zone, entities conducting investment activities intheeconomic zonehavethe
righttocontinue conducting suchactivities under conditions atthemoment ofinitiation ofinvestment
anduntilthetermination oftheperiod ofthespecial economic zone(butnolonger than10years from
thetimeofchanges orabolishment ofthespecial economic zone).
Thespecial economic zones aretreated asbeing outside thecustoms territories ofKazakstan.
However, legal entities inthespecial economic zones aresubject tothetaxation, registration, and
licensing legislation oftheRepublic ofKazakstan. Banking activities mayalsobecarried outinspecial
economic zones according tothebanking legislation ofKazakstan.
Question 99.
TheMemorandum states thattheLawOnSpecial Economic Zones envisages theadmission of
foreign citizens intothespecial economic zones.
Willforeign enterprises bepermitted tooperate within theSpecial Economic Zones without having
tocreate aKazakstani legal entity? What restrictions andconditions willapply toforeign
enterprises operating within theSpecial Economic Zones?
According totheForeign Investment Lawof1994, aforeign Enterprise isaKazakstani legal
person with100percentforeign participation.WT/ACC/KAZ/6/Add.2
Page48
Inorder tooperate within theSpecial Economic Zones, aforeign company mustregister as
aKazakstani legalperson which could bepartially orfullforeign-owned. Theregistration procedure
andrequirements aredescribed under question 34ofthisdocument.
Foreign enterprises (fully foreign-owned Kazakstani legal persons) aretreated equally to
Kazakstani legalpersons without foreign ownership. Botharesubject tothesamelawsandregulations.
(h) Trade-related environmental policies
Question 100.
TheMemorandumstatesthat,accordingtotheLawonProtectionofEnvironmentandGovernment
Resolution No.637,newtechnical devices, technologies, materials andsubstances maynotbe
imported toorproduced inKazakstan forthefirsttimewithout positive conclusion oftheState
ecological expertise conducted bytheMinistry ofEcology andBio-Resources.
Doallnewtechnical devices, technologies, materials andsubstances havetobeapproved bythe
Ministry ofEcology andBio-Resources, oristhere adefined listofcategories oftheabove? If
so,please provide suchalist.
Yes.Allnewtechnical devices, technologies, materials andsubstances, imported forthefirst
timetoKazakstan, havetobeapproved bytheMinistry ofEcology andBio-Resources. Theapplicant
mustprovidedocumentsindicatingpotentialenvironmentalimpactconnectedwiththeuseofsuchdevices,
technologies, materials andsubstances.
There isnodefined list.
Question 101.
Ifapproval isonlyrequired forselected technical devices, technologies, material andsubstances,
howisthislistdetermined?
There isnodefined list.
Question 102.
Onaverage, howlongdoesobtaining approval take?
Theenvironmental impact assessment andapproval maytakeupto3months from thedate
ofreceiving allmaterials depending onthequality ofdocuments, potential environmental danger of
products, andtheneedtousetheservices ofindependent experts.
Question 103.
With respect toAnnex 5andGovernment Resolution No.411listing theproduct categories subject
tocompulsory certification toensure safety, health, protection ofproperty ofcitizens andthe
environment:
Does every shipment ofeachofthese products have been certified orjustthefirstshipment or
thefirstshipments withspotchecks?
Onecertificate must beobtained fortheimport ofaspecific quantity ofaspecific product.
Theimporter mayimport suchquantity overanumber ofshipments. There isnoneedtoobtain a
newcertificate foreachshipment. Acopyofthecertificate issufficient. However, ifthecertificateWT/ACC/KAZ/6/Add.2
Page49
isobtained from anon-Kazakstani accredited certification body, thecopy must beconverted toa
Kazakstani certificate foreachshipment (seeQuestion No.91).
Question 104.
Does certification require inspection? Ifso,must eachshipment beinspected?
Certificates maybeobtained priortoshipping products toKazakstan. Ashipment accompanied
byacertificate (oracopyofacertificate -seequestion No.103)issued byanaccredited certification
body isonlysubject tousual customs inspection. Allproducts, subject tocompulsory certification,
imported toKazakstan shallbecontrolled bythecustoms. Oneofthefollowing documents should
beprovided tothecustoms fortheimportation ofgoods requiring compulsory certification:
- Certificate ofGosStandard issued byanaccredited Kazakstani certification body;
- Certificate provided byanyoftheStatecertification bodies ofArmenia, Azerbaijan, Belarus,
Georgia, Kyrgyzstan, Moldova, theRussian Federation, Tajikistan, Turkmenistan, Ukraine,
andUzbekistan;
- Certificate provided byforeign certification bodies accredited byGosStandard; or
- Application-Declaration form which maybefiledbytheimporter iftheimported goods do
nothaveacertificate. Theimporter mayclear theimported goods from customs butmust
initiate thecertification process within tendaysanddoesnothavetherighttosellthese goods
untilthecertificate isgranted.
Iftheimporter optsnottofileanApplication-Declaration form, thengoods mustbekeptin
customs storage warehouses atafeeuntiltheimporter obtain acertificate from anyoftheaccredited
certification bodies. Samples maybewithdrawn onlyfortesting. Thesame testing andinspection
procedures areperformed onimported products asdomestic products.
Goods mayremain inCustoms storage warehouses foramaximum period of3years.
Iftheimported product isproven nottocorrespond tostandards andisconsidered tobeof
potential danger, thenaspecial commission isestablished todecide whether theproduct should be
(i)reprocessed, (ii)destroyed, or(iii)shipped backtothecountry oforigin. Decisions made bythe
commissionmaybeappealedbytheimporter.Duringsuchperiod,thegoodsmustremainundercustoms
supervision andtheimporter must payrequired storage fee.
However, adecision toimmediately destroy thegoods maybetaken ifitsstorage isproven
tobedangerous because ofsanitary reasons, ifthereisnotadequate storage facilities, oriftheproduct
cannot beheldinstorage without further damage.
Question 105.
Aredomestic products subject tothesame inspection requirements andprocedures?
Therequirements andcertification procedure forproducts manufactured inKazakstan andfor
products imported toKazakstan arethesame. Domestic products aresubject tothesame inspection
requirements andprocedures.
Question 106.
What isKazakstan 'sexperience inpractice with theacceptance ofcertification from foreign
certification bodies foritems onthislist?
Asmentioned under question 92,Kazakstan honours certificates issued bythecertification
bodies ofother CIScountries andseveral foreign certification bodies accredited byGosStandard.WT/ACC/KAZ/6/Add.2
Page50
Kazakstan hashadpositive experience inpractice withtheacceptance ofcertification from foreign
certification bodies.
(j) Government-mandated countertrade andbarter
Question 107.
Does theGovernment maintain statistics onthevalue andquantity ofgoods imported intoand
exported from Kazakstan through counter-trade andbartering within theCARES? Ifso,please
furnish. Ifnot,please describe thegeneral categories ofproducts traded inthismanner.
TheGovernment doesnotmaintain statistics onthevalue andquantity ofgoods imported into
andexportedfromKazakstanthroughcounter-tradeandbarteringwithintheCIScountries.Countertrade
andbarter withCIScountries, however, isestimated tobe5.7percentrelative toKazakstan 'stotal
foreign trade.
Products inthefollowing general categories arebeing traded viacounter-trade andbartering:
rawmaterials, machinery, parts, andcomponents.
(l) Government procurement practices
Question 108.
Currently there aretwotypes ofprocurement ofgoods orservices, those procured under Resolution
No.586andthose procured inaccordance withtheinternal procurement regulations ofState
entities.
Please describe theprovisions ofResolution No.586fortheWorking Party.
AfulltextcopyofGovernment Resolution No.586foryourreview andreference isprovided
inAttachment A.
Question 109.
Arethere plans toendthistwo-tier system? Ifso,what typeofsystem isenvisioned?
Yes.TheRepublicofKazakstaniscurrentlyintheprocessofdraftingagovernmentprocurement
lawbased upon theUNCITRAL model government procurement law. Thenewlawwilldiffer
significantly from Government Resolution No.586.
Question 110.
Forthose items appearing ontheListofGeneral-Purpose Goods, where arethepublic
announcements published? Name ofNewspaper? Magazine?
Inaccordance withArticle 10ofResolution No.586,theannouncement ofprocurement for
goods,works,orservicesappearingontheListofGeneral-PurposeGoods,arecommunicatedtopotential
suppliers through publication inthemass media (e.g. Kazakstanskaya Pravda) andbycirculating
invitations topotential bidders.
Question 111.
Forthose items notappearing ontheListofGeneral-Purpose Goods, where arethepublic
announcements published?WT/ACC/KAZ/6/Add.2
Page51
Public announcements areusually circulated topotential bidders andpublished inmassmedia
(e.g.Kazakstanskaya Pravda)
Question 112.
Kazakstan states thattheprocedures governing tenders organized byState Customers areidentical
tothose governing theprocurement ofgoods orservices appearing ontheListwithoneexception:
there isnostated priority given todomestic overforeign suppliers. Thisexception isoutlined as
a20percentprice-preference rule.
Arethere domestic content rules thatapply toanyprocurements? Please explain indetail any
andallpriorities andpreferences given todomestic suppliers overforeign suppliers.
There arecurrently nodomestic content rules thatapply togovernment procurements.
Question 113.
Arethere bid-challenge procedures inplace ifacompany disagrees withanaward byeither the
State Customers ortheBidding Commission oftheMinistry ofEconomy? Ifso,please describe
indetail theprocedures forfiling abid-protest.
Therearecurrentlynobid-challengeproceduresinplace.Pleasenote,however,thattheRepublic
ofKazakstan iscurrently intheprocess ofdrafting agovernment procurement lawbased upon the
UNCITRAL model government procurement law.
-- Asapartofitsprotocol accession commitments, weexpect Kazakstan tobecome amember
oftheGovernment Procurement Agreement, aschedule ofcommitments tobesubmitted tothe
GPA Committee nolater than3months after thedateofaccession totheWTO.
(m) Regulation oftrade intransit
Question 114.
TheMemorandum states thatArticle 35oftheCustoms Code provides forexceptions tothetransit
ofgoods incases where theGovernment hasadopted another decision asaretaliatory measure.
Aresuchdecisions published forpublic comment? Ifso,inwhich publications aretheyfound?
Thequoted provision isintended toallow theGovernment ofKazakstan tolimitthetransit
through theterritory oftheRepublic ofgoods originating incountries ortheirunions which havetaken
actions thatharm theinterests ofKazakstani entities. Thecircumstances inwhich theprovision may
beapplied arenotfurther defined bylaworimplementing legislation. Inaddition, theprocess ofpubic
notification regarding suchdecisions isnotyetdefined.
Please notethatthisprovision hasnotbeenapplied todate.WT/ACC/KAZ/6/Add.2
Page52
V. TRADE-RELATED INTELLECTUAL PROPERTY REGIME
1. General
(c) Membership international intellectual property conventions andregional orbilateral
agreements
(ii) Anticipated membership ininternational intellectual property conventions
Question 115.
Section V.1(c)(ii) ofKazakstan 'sMemorandum ofForeign Trade states thattheRepublic of
Kazakstan isnowprepared tocomplete theprocess ofaccession totheBerne convention forthe
Protection ofLiterary andArtistic Works (theBerne Convention).
When isitexpected thattheRepublic ofKazakstan willdeposit itsinstrument ofratification?
TheState Agency onCopyrights andRelated Rights hassubmitted aformal proposal tothe
Government oftheRepublic ofKazakstan toaccede totheBerne Convention. Thatproposal iscurrently
being considered byrelevant Stateagencies. Unfortunately, atime- frame foraGovernment Resolution
onaccession hasnotyetbeenformally defined.
Question 116.
Section V.1(c)(ii) oftheMemorandum citestheKazak-Russian Intergovernmental Agreement
inthefieldofIndustrial Property andasimilar agreement withtheKyrgyz Republic.
Isthere anyadvantage, benefit, privilege, orimmunity granted byKazakstan toRussian orKyrgyz
nationals notgranted toother foreign nationals onamost-favoured-nation basis? Ifso,please
describe theadvantages, benefit, privilege, orimmunity.
Nationals fromtheRussian Federation andKyrgyz Republic enjoy thesame rights which are
granted tonationals oftheRepublic ofKazakstan onareciprocal basis. Assuch, Russian andKyrgyz
nationals donotneedtoengage theservices ofapatent ortrademark agent (trustee) inorder tosubmit
applications tothePatent Office; rather, theymaysubmit theirapplications directly. Patent fees,
moreover, maybepaidinRussian Rubles orKyrgyz Som. Finally, thefeeschedule forKazak nationals
(assetforthinAnnex 10oftheMemorandum) isalsoapplied tonationals oftheRussian andKyrgyz
Republics.
(d) Application ofnational andm.f.n. treatment toforeign nationals
Question 117.
Section V.1(d) oftheMemorandum states thatKazakstan 'sConstitution, Civil Code andLaw
onForeign Investments givephysical andjuridical persons bothnational andmostfavoured nation
treatment. Please citethesections ofeachofthose documents andprovide atranslation ofthe
text.
Article 12(4)of theRepublic ofKazakstan 'sConstitution
"Foreigners andpersons without citizenship exercise theirrights andfreedoms inthe
Republic, aswellascarry outtheduties setupforthecitizens, unless otherwise
provided bytheConstitution, lawsandinternational treaties. "
Article 3(7)oftheRepublic ofKazakstan 'sCivil CodeWT/ACC/KAZ/6/Add.2
Page53
"Foreign individuals andlegalentities aswellaspersons without citizenship areentitled
toacquire thesame rights andtoperform thesame duties which areprovided for
individuals andlegalentities oftheRepublic ofKazakstan bythecivillegislation, unless
otherwise provided bylegislative acts."
Article 4(1)oftheRepublic ofKazakstan 'sLawonForeign Investments
"Any forms offoreign investment andactivities related toitwhich isnotprohibited
bythecurrent legislation oftheRepublic ofKazakstan aremade onconditions notless
favourable thanthose which areprovide fortheinvestment ofindividuals andlegal
entities oftheRepublic ofKazakstan inasimilar situation, oranyother foreign
individuals orlegalentities dependent onwhatconditions arethemost favourable."
(e) Feesandtaxes
Question 118.
Thefeeschedule inAnnex 10isseparated intofeescharged nationals andnon-nationals asstated
insection V.1(e) oftheMemorandum.
AretheFeescharged non-nationals equivalent tothose charged national and,ifnot,what isthe
justification forthedifference ifKazakstan 'sConstitution, Civil Code andLaw onForeign
Investments require thatphysical andjuridical persons begiven national treatment?
TheConstitution, CivilCode andLawonForeign Investments allguarantee national treatment
unless anexception fromthatguarantee isstipulated byanother law.Government Resolutions No.889
dated 20October 1992 andNo.266dated 6April 1993 provide forexceptions tonational treatment
inthesetting ofthefeeschedule charged toKazak andforeign nationals.
2. Substantive Standards ofProtection, Including Procedures fortheAcquisition and
Maintenance ofIntellectual Property Rights
(a) Copyright andrelated rights, including rights ofperformers, producers ofphonograms
andbroadcasting organizations
Question 119.
Please describe howdatabases areprotected under Kazakstan 'sLawonCopyrights andRelated
Rights.
According toArticle 7oftheCopyright Law, databases areprotected bycopyright. The
Copyright Lawdefines databases asacollection ofinformation (articles, calculations, factsetc.)which
duetoselection and(or)organization ofthematerials represent results ofacreative work andare
systematized insuchamanner thattheinformation mayberetrieved andprocessed withthehelpof
acomputer. Recent amendments tovarious laws, assetforthin,additions andAmendments toCertain
Legal ActsoftheKazak SSRdated 16July1996, moreover, provides foradministrative, civiland
criminal responsibility fortheviolation ofcopyrights.
Question 120.
Intheevent thattheterm ofcopyright cannot bemeasured bythelifeofanauthor, what isthe
term ofprotection provided under Kazakstan 'scopyright law?
Article 28oftheCopyright lawdetermines theterms ofcopyrights asfollows:WT/ACC/KAZ/6/Add.2
Page54
1. Thecopyright shallbevalid during theentire life-span oftheauthor andforfiftyyears after
hisdeath, except forthecases stipulated inthisArticle.
2. Therightofauthorship, therightofname andtherighttoprotect reputation ofauthors shall
beprotected termlessly.
3. Inthesame procedure thatexecutor ofawillisappointed, anauthor shallhavetherightto
indicate theperson towhom hedelegates theprotection ofthecopyright, theright toname andthe
righttoprotect hisreputation afterhisdeath.
4. Thecopyright inrespect ofanitempromulgated anonymously orunder apenname, shallbe
validwithin fiftyyears afterthedateofitslegitimate promulgation. When during theindicated period
anauthor ofanitemreleased anonymously orunder apenname, should disclose hisidentity, orhis
identity should leave nodoubts anylonger, thentheprovision ofparagraph 1ofthisArticle shallapply.
5. Thecopyright inrespect ofanitemcreated inco-authorship shallbevalid during theentire
lifeandfiftyyears afterthedeath ofthelastauthor whosurvived theother authors.
6. Thecopyright inrespect ofanitemwhich wasfirstreleased within thirty years upontheauthor 's
death, shallbevalid during fiftyyears afteritsrelease, counting fromthefirstofJanuary oftheyear
following theyearoftheitem'srelease.
7. Intheevent thatanauthor wasrepressed andrehabilitated posthumously, thenthetermof
protection ofhisrights which isstipulated inthisArticle, shallbevalid from thefirstofJanuary of
theyearfollowing arehabilitation.
8. Themeasurement ofperiods stipulated inthisArticle shallbegin fromthefirstofJanuary of
theyearfollowing ayearinwhich thelegalfactwhich isthebasisforbeginning oftheperiod 'scourse
tookplace.
Question 121.
Section V.2(a) makes noreference torestoration ofcopyright inworks thatarestillprotected
intheircountry oforigin andthathavenothadafulltermofprotection inKazakstan. Article 18
oftheBerne Convention, incorporated byreference inArticle 9.1oftheTRIPS Agreement requires
thatcopyright protection beapplied tosuchworks.
Please describe howKazakstan plans tofulfil thisobligation onitsaccession totheBerne
Convention.
TheCopyright Lawfullyimplements theprovisions setforthintheBerne Convention including
Article 18thereof (andArticle 9.1oftheTRIPS Agreement) regarding theprinciple ofexpiry ofterms
ofprotection. Inparticular, Article 5(1)(3) oftheCopyright Lawstates thatcopyright protection will
beextended, toitems promulgated, ornotpromulgated butexisting inobjective form, beyond the
boundaries oftheRepublic ofKazakstan andwhich arerecognized asbelonging totheauthors (ortheir
legal successors) whoarecitizens ofother states inaccordance withtheinternational treaties ofthe
Republic ofKazakstan. When Kazakstan accedes toandratifies theBerne Convention, theterms of
thatConvention willbedirectly applicable within theRepublic inaccordance withArticle 4ofthe
Constitution. Accordingly, theterms ofprotection extended toauthors byvirtue ofArticle 28ofthe
Copyright Lawwillapply toworks which, atthemoment ofthecoming intoforce oftheConvention
within Kazakstan, havenotyetfallen intothepublic domain inthecountry oftheirorigin. Those worksWT/ACC/KAZ/6/Add.2
Page55
which havealready fallen intothepublic domain byvirtue oftheprinciple oftheexpiry ofterms will
bedeemed tobenational property inaccordance withArticle 29oftheCopyright Law.
Question 122.
Section V.2(a) states thatKazakstan 'snewLawonCopyrights andRelated Rights provides rental
rights forcinematographic works andcomputer programs. Subsection (iii)doesnotmention rental
rights inconnection withsound recordings.
Arerental rights provided producers ofsound recordings and,ifnot,when willthelawbeamended
toprovide suchrights?
Yes. Article 38(3) oftheCopyright Lawprovides rental rights totheproducers ofsound
recordings asfollows, "...The right todistribute copies ofa[sound recording] shall restwiththe
[manufacturer] ofthephonogram, irrespective oftherightofownership ofthose copies."
Question 123.
Section V.2(a)(iii) discusses protection fortheproducers ofphonograms, butdoesnotmention
providing protection forexisting works.
Please describe howKazakstan plans toprotect sound recordings thatarestillprotected intheir
country oforigin andhave nothadafullterm ofprotection inKazakstan asisrequired by
Article 14oftheTRIPS Agreement.
Article 42oftheCopyright Lawextends 50yearterms ofcopyright protection toperformers
(from thedateoftheirfirstperformance orstage production); phonogram manufacturers (from the
dateoftheirfirstpublication orfirstrecording ifnotpublished); broadcast organizations including
cable (from thedateoftheirfirstbroadcast), andradio andtelevision broadcasts (from themoment
oftheirlegitimate production orcreation and,ifnotproduced, thenfromthedatetheCopyright Law
entered intoforce -10June1996-theywillbeprotected asrelated rights untiltheirtermshallexpire).
Article 5oftheCopyright Law, moreover, extends protection totheaforementioned (regardless of
theircountry oforigin) inthesame manner asprotection would beextended iftheywere ofKazak
origin. Assuch, allrequirements setforthinArticle 14oftheWTO TRIPS Agreement inconnection
withsound recordings arefulfilled through theprotection afforded them bytheCopyright Law.
(b) Trademarks, including service marks
Question 124.
Section V.2(b) states thatatleastfiveconsecutive years ofnon-use ofamark must occur before
interested parties mayfileapetition forcancellation fornon-use.
Ifthereason fornon-use isbeyond thecontrol oftheowner ofthemark, suchassome restriction
onthesaleoftheproduct orservice identified bythemark, would thatprevent cancellation?
Article 24(5) oftheLawonTrademarks provides thattheowner ofatrademark challenged
fornon-use thereof, maysubmit evidence demonstrating thatnon-use wasduetocircumstances beyond
thecontrol oftheowner. ThePatent Office, inrendering itsdiscretionary determination onnon-use,
isbound totakethisevidence intoaccount.WT/ACC/KAZ/6/Add.2
Page56
Question 125.
Article6bisoftheParisConventionfortheProtectionofIndustrialproperty(theParisConvention),
adopted byreference byArticle 2.1oftheTRIPS Agreement, requires thatmembers protect
well-known marks, eventhough notregistered.
Please describe thenature oftheprotection forwell-known marks under Kazakstan 'sLawand
describe what theowner ofsuchamark must dotoinvoke thisprotection.
Legal protection oftrademarks intheRepublic ofKazakstan isprovided onthebasis ofthe
registration andissuance ofatrademark certificate inaccordance withtheprocedures setforthinthe
LawonTrademarks. Article 15(1) oftheTrademark Lawspecifically prohibits theregistration of
marks astrademarks which aresimilar oridentical tothose which areprotected byvirtue ofinternational
conventions towhich Kazakstan isaparty. Since theGovernment oftheRepublic ofKazakstan has
declared itsparticipation intheParisConvention, theterms ofthatConvention, specifically Article 6bis
and10bis, aredirectly applicable inaccordance withArticle 4oftheConstitution. Assuch, the
right-holders ofwell-known marks areafforded protection regardless ofwhether those rights are
registered assuchintheRepublic ofKazakstan.
Inorder toinvoke thisprotection, theowner maypetition thePatent Office oftheRepublic
ofKazakstan tocancel theregistration oftheoffending mark. Theowner mayalsopetition the
administrative bodies orcourts oftheRepublic ofKazakstan torecognize themark aswell-known and
toprevent itscontinued unauthorized use.Ifamark isrecognized aswell- known inaccordance with
Article 31oftheTrademark Law, acourt orother administrative body maycompel theviolator to:
- terminate theuseofthewell-known mark ordesignation which issimilar tothewell- known
mark totheextent thatitiscausing confusion withit;andupon thechoice oftheowner to:
- compensate theowner forfulldamages including totalamount oflostprofits gained
from illegal useofthemark;
- remove fromgoods orpackaging theillegally usedmark ordesignation similar thereto;
and
- publish thedecision oftheadministrative body orcourt which isauthorized byLaw
toconsider thedispute.
Question 126.
Please describe anylimitations orrestrictions placed upon licensing oftrademark, including any
restrictions relating toinvestment.
There arenolimitations orrestrictions placed upon thelicensing oftrademarks, assuch.
According toArticle 26oftheLawonTrademarks, agreements forthelicensing oftrademarks must
comply withthefollowing conditions:
- theagreement must beinwriting;
- provisions within thelicensing agreement stipulating thequality ofthegoods associated with
thelicensee 'suseofthetrademark willnotbeinferior tothose ofthelicenser 's;
- provisions inthelicensing agreement providing tothelicenser therighttosupervise compliance
withtheterms oftheagreement; and
- mandatory registration oftheagreement between thelicenser andlicensee withthePatent Office.WT/ACC/KAZ/6/Add.2
Page57
(c) Geographical indications, including appellations oforigin
Question 127.
Section V.2(c) states thatgeographical identifications identifying aproduct having aquality or
characteristic attributable totheareawithin Kazakstan where itoriginates canberegistered with
theNational Patent Office.
Please describe thenature oftherights acquired withregistration?
According totheTrademark Law, geographical indications mayberegistered asdesignating
agood whose specific qualities aremainly orexclusively associated withitsplace oforigin (where
place oforigin isunderstood tobethegood'ssource ofnatural occurrence, manufacture orboth).
Thegeographical indication cannotitselfconstitute anobject ofregistration which provides exclusive
rights tooneormore business entities; onlythegeographical indication 'sassociation withaparticular
good maybesoregistered. Assuch, thecertificate ofregistration confers therighttousethename
oftheplace oforigin ofagood inassociation withthatgood. Geographical indications, moreover,
mayonlyberegistered iftheydonotmislead consumers regarding place oforigin orencroach upon
therights ofthird parties. Finally, geographical indications which areobviously fictitious, maybe
applied togoods butwillremain unprotected assuch.
Question 128.
Areforeigners provided protection forgeographical indications ofproducts originating within
another country 'sterritory? Please describe therequirements ofsucharegistration.
Yes. Anapplicant(regardless ofnationality) forregistration ofageographical indication and
thegranting ofitsrightofuseinassociation withaparticular goodshould submit tothePatent Office
awritten application containing thefollowing information:
- asingle name indicating theplace oforigin ofagood;
- thename oftheapplicant(s) andtheapplicant(s) 'splace ofresidence;
- thedesignation which isapplied tothegoods;
- thetypeofgood forwhich theregistration oftheplace oforigin issought including itsplace
ofmanufacture (ornatural occurrence orboth) andadescription ofthespecific properties of
thegood;
- iftheapplicant (whether foreign ordomestic) isseeking ageographical indication inassociation
withgoods originating within theterritory oftheRepublic ofKazakstan, thenaconclusion
ofthelocaladministrative bodycertifying thattheapplicant resides, andthegoods originate,
therein;
- iftheapplicant (whether foreign ordomestic) isseeking ageographical indication inassociation
withgoods originating outside theterritory oftheRepublic ofKazakstan, thenadocument
certifying therightoftheforeign applicant tothegeographical indication inassociation with
agood from thecountry where thegood originates; and
- adocument confirming theauthority ofapatent trustee toactonbehalf oftheapplicant (while
domesticapplicantsmaysubmittheirapplicationsdirectlytothePatentOffice,foreignapplicants
must submit theirapplications through apatent trustee).
Question 129.
Who mayapply forregistration? Please describe howageographical indication isenforced in
Kazakstan.
Seeanswer toprevious questions.WT/ACC/KAZ/6/Add.2
Page58
(d) Industrial designs
Question 130.
Areapplication forpatents forindustrial designs searched examined inamanner similar topatent
applications oristhepatent based upon aregistration system?
Industrial designs areinitially granted protection onthebasis ofapreliminary patent. A
preliminary patent isgranted afteraformal expertise oftheapplication forapreliminary patent and
isvalid foraperiod offiveyears fromthedateofitsreceipt bythePatent Office. Atanytimeduring
thefirstfouryears ofthedatethattheapplication forapreliminary patent issubmitted, anapplication
forapatent maybesubmitted. After anexpertise inessence isconducted, including acheck onthe
conditions ofpatentability oftheindustrial design (novelty, originality andindustrial applicability),
apatent maybegranted foraperiod oftenyears (calculated from thedatethattheapplication fora
patent wassubmitted tothePatent Office). Thepatent-holder mayalsopetition thePatent Office for
anextension ofthepatent foruptofiveadditional years.
Question 131.
Section V.2(d) oftheMemorandum states thatacompulsory licence canbegranted bythecourts
iftheowner ofapatent oranindustrial design doesnotusethepatent during theperiod that
isfiveyears following thedatethepatent wasgranted.
Ifthereason fornon-use isbeyond thecontrol oftheowner ofindustrial design, suchassome
restriction onthesaleoftheproduct involved, would thatserve asjustification forthenon-use
andprevent thegrant ofthecompulsory licence?
Yes. According toArticle 11(3) ofthePatent Law, theowner ofapatent confronted with
apetition foracompulsory licence fornon-use thereof, maysubmit evidence demonstrating thatnon-use
wasduetorespectful reasons.
Question 132.
Section V.2(e) oftheMemorandum states thatlayout designs ofintegrated circuits areexcluded
from patentability under Kazakstan 'spatent law.Article 27.1oftheTRIPS Agreement requires
thatpatents beavailable inallfields oftechnology, except forthose identified inparagraphs 2
and3.Integrated circuit layout designs arenotsoidentified.
What plans hasKazakstan toamend itspatent lawtoeliminate theexception from patentability
forlayout designs?
Currently, Article 5(3)ofthePatent Lawdoesnotrecognize thelayout designs ofintegrated
circuits aspatentable. Itisanticipated, however, thatprotection ofintegrated circuit layout designs
willbeprovided forintheSpecial PartoftheCivilCode (PartII)andaLawontheProtection ofLayout
Designs. TheGovernment, however, hasnotyetcirculated official drafts ofPartIIoftheCivil Code
ortheLawontheProtection ofLayout Designs.
Question 133.
Section V.2(e) oftheMemorandum liststheactivities thatwould betreated infringement ofthe
patent. Useofthepatented invention isnotlisted.
Would unauthorized useofapatent invention inKazakstan constitute infringement ofthepatent?WT/ACC/KAZ/6/Add.2
Page59
Yes. Article 15ofthePatent Lawclearly states that,"anyperson ...which usesitems of
industrial property [defined inArticle 1ofthePatent Lawtoinclude patent inventions] incontradiction
tothisLawshallbeaviolator ofthepatent".
Question 134.
Section V.2(d) oftheMemorandum states thatacompulsory licence canbegranted bythecourts
iftheowner ofapatent foraninvention doesnotusethepatented invention during theperiod
thatisfiveyears following thedatethepatent wasgranted.
Ifthereason fornon-use isbeyond thecontrol oftheowner oftheinvention, such assome
restriction onthesaleoftheproduct involved, would thatserve asjustification forthenon-use
andprevent thegrant ofcompulsory licence?
Yes.Article 11(3) ofthePatent Lawprovides thatapatent-holder whoischallenged toprovide
acompulsory licence onthebasis ofnon-use, mayprovide evidence tothecourt thatthe,insufficient
usehasbeencaused byrespectful reasons.
(f) Plant variety protection
Question 135.
Section V.2(f) oftheMemorandum states thatplant variety protection isonKazakstan 'slegislative
agenda for1997-98.
Please describe thenature oftheprotection envisioned andmeans foracquiring it.WillKazakstan
become amember oftheConvention forProtection ofNewVarieties ofPlants when thatlegislation
isenacted?
Itisanticipated thatthedraftLawonProtection ofSelection Achievements willcertify: (i)that
thepatent-holder hasanexclusive right totheselection achievement, (ii)thepriority ofthepatent,
and(iii)theauthorship oftheselection achievement. Applications forthispatent willbereceived by
thePatent Office andtheapplication willbegranted uponitsproper expertise. Thescope ofthelegal
protection provided willbedetermined byatotaloftheindications included intothedescription of
thegrade ofplants orbreed ofanimals. Upon enactment oftheLaw, theRepublic ofKazakstan intends
tocommence theprocess ofaccession totheUPOV Convention ontheProtection ofSelection
Achievements.
Question 136.
Isitenvisioned thatsome form ofprotection willbeprovided forselection achievements inbreeds
ofanimals?
Yes.AspecificlawonselectionachievementsiscurrentlyontheGovernment'sdraftingagenda.
Anofficial draftofthislaw,however, hasnotyetbeenprepared.
(g) Layout designs ofintegrated circuits
Question 137.
When islegislation forprotection ofintegrated circuit layout designs expected tobeprepared
andenacted?WT/ACC/KAZ/6/Add.2
Page60
Itisanticipated thatprotection ofintegrated circuit designs willbeprovided intheSpecial Part
oftheCivil Code (Part II)andtheLawontheProtection ofLayout Designs. Asalready noted, the
Government hasnotyetcirculated official drafts ofthese twoproposed laws.
(h) Requirements onundisclosed information, including trade secrets andtestdata
Question 138.
PleasegivecitationstotheportionsofKazakstan'sCivilcodethatprovideprotectionforundisclosed
information anddescribe thenature oftheprotection provided suchinformation.
Article 126oftheCivil Code states that:
"1. Theinformation making official orcommercial secret isprotected bythelawincasewhen
theinformation hasactual orpotential commercial value because itisnotknown tothirdpersons, there
isnofreeaccess toitonlegal grounds andtheinformation possessor takes measures toprotect its
confidentiality.
2. Personswhoobtainedsuchinformationillegally,aswellasemployeescontrarytolabourcontract
orcounter-agents contrary tocivillawcontract whodisclosed official orcommercial secret, arebound
tocompensate theinflicted damage."
Question 139.
How would theperson incontrol ofundisclosed information enforce hisrights? What remedies
areavailable?
Atpresent, thelawsoftheRepublic ofKazakstan provide civilremedies topersons incontrol
ofundisclosed information. Accordingly, aperson incontrol ofundisclosed information whowishes
toenforce hisrights mustfileacomplaint withthecourt having jurisdiction overtheperson whohas
allegedly violated those rights. Remedies which thecourt canprovide include thepayment ofdamages
andthecosts ofenforcing therights.
Question 140.
Areremedies available against aparty thatacquired undisclosed information ifthatparty knew
orshould have know thatitwasacquired inamanner thatwascontrary tohonest commercial
practices.
Same asabove. Please note, however, thataperson whoacquires undisclosed information
knowingly orunder circumstances inwhich thatperson should haveknown thatitwasundisclosed
maybeliable foractsconstituting unfair competition inaccordance with Article 193(3) ofthe
Administrative Code andArticle 168(2) oftheCriminal Code.
Question 141.
Please describe indetail theprotection provided undisclosed datasubmitted toagencies ofthe
Republic ofKazakstan inorder toobtain marketing approval forchemical, pharmaceutical, or
agricultural products.
Undisclosed datasubmitted totheagencies oftheRepublic ofKazakstan inorder toobtain
marketing approval forchemical, pharmaceutical, oragricultural products isprotected byArticle 126
oftheCivil Code asanofficial secret (seeanswer toquestion 138supra). Assuch, employees of
ministries andother State agencies which disclose anofficial secret willbeheldadministrativelyWT/ACC/KAZ/6/Add.2
Page61
responsible. TheMinistries andother State agencies which employ theindividual making suchan
unauthorized disclosure, willalsobeheldliable fortheemployee 'sunauthorized action.
3. Measures toControl Abuse
Question 142.
Please describe theactivities inconnection withintellectual property rights thatwould beconsidered
abuse under Kazakstan 'slaw.
Thefollowing activities inconnection withintellectual property rights areconsidered anabuse
ofthose rights andwillentail criminal responsibility:
- falsely assuming authorship orforcing others toassume co-authorship bypersons whodidnot
takepartinthecreative work leading toadiscovery, invention orrationalization; thedisclosure
oftheessence ofadiscovery, invention orrationalization proposal without theconsent ofan
author prior tofiling theapplication;
- undue delays inreviewing aninvention orrationalization proposal, evasion from informing
aninventor orarationalization ontheuseofhisinvention orrationalization proposal,
deliberately wrong calculation ofeconomies ordeliberately wrong calculation ofroyalty and
delay initspayment, which were committed byanofficial;
- disclosure ofinformation onsecret discoveries, inventions andrationalization proposals, in
theabsence ofindication oftreason (Art.129 oftheCriminal Code);
- violation ofcopyright andallied rights expressed inillegal reproduction, circulation,
dissemination orother illegal useofobject ofcopyright orallied rights committed withthe
view togainprofit, which caused heavy damage totheholders ofcopyright orallied rights
(Art. 129-1 oftheCriminal Code).
Thefollowing activities inconnection withintellectual property rights areconsidered anabuse
ofthose rights andwillentail administrative responsibility:
- theuseofitems ofindustrial property which havebeencertified byappropriate documentation
inamanner which infringes established norms andrules (Art. 170-2 oftheAdministrative
Code, Article 30oftheTrademark Law, andArticles 15and33ofthePatent Law);
- sale,hiring outandother illegal useofcopies ofworks orphonograms, incaseif:
- copies ofworks orphonograms arecounterfeit according totheRepublic ofKazakstan 's
legislation;
- onthecopies ofworks orphonograms falseinformation oftheirproducers andplaces
ofproduction isprovided, aswellasother information which maymislead customers;
- onthecopies ofworks orphonograms copyright protection mark orallied rights
protection mark putbythecopyright holder orallied rights holder, isdestroyed or
changed (Art.170-3 oftheAdministrative Code);
- refusal toprovide thenecessary dataonincome toanauthorized agency aswellas
presentation ofunauthentic dataonincome gained inconnection withtheuseofobjects
ofcopyright andallied rights (Art.170-4 oftheAdministrative Code).WT/ACC/KAZ/6/Add.2
Page62
Anyother infringements ofprovisions andrequirements ofcurrent legislation onintellectual
property areregarded ascivillawinfringements andinvolve civillawresponsibility -basically, in
theform ofobligation tocompensate thedamage caused.
4. Enforcement
(a) Civil judicial procedures andremedies
Question 143.
Please describe thestructure ofKazakstan 'sjudicial system dealing withdisputes fordomestic
parties andforeign parties atalllevels.
AccordingtothecurrentlegislationoftheRepublicofKazakstan,disputesconcerningintellectual
property rights areconsidered ongeneral terms inregular courts. Thestructure oftheregular court
system issetforthinSection III.1(c) oftheMemorandum. There isnodistinction between domestic
andforeign parties whoareparties totheaforementioned typeofdispute. Please note, however, that
foreign investors maybeaccorded additional dispute settlement alternatives inaccordance withthe
LawonForeign Investment (seediscussion supra).
Question 144.
Please describe what training, ifany,hasbeen provided tojudges toenable them toconsider
disputes involving intellectual property rights.
TheRepublic ofKazakstan hasnotyetinstituted aprogramme ofspecial training inintellectual
property matters forjudges
(b) Provisional measures
Question 145.
When isitenvisioned thatjudges andadministrative authorities willbegiven theauthority to
grant provisional relief inorder toprevent serious harm andtopreserve evidence?
Judges andadministrative authorities already havethepower tograntprovisional relief inorder
toprevent serious harm andtopreserve evidence. Article 135oftheCivil Code oftheRepublic of
Kazakstan provides judges withthepower totakethefollowing measures tomeetaclaim attherequest
ofthecomplainant (orupon theinitiative ofthejudge):
- toarrest thedefendant 'sproperty;
- toprohibit adefendant fromtaking certain actions suchasthesaleofgoods bearing atrademark
belonging tothecomplainant; and
- toprohibit other persons from transferring property tothedefendant orfromfulfilling other
commitments withregard tothedefendant.
Procurators, moreover, havepowers similar tothose ofajudge.
(c) Administrative procedures andremedies
Question 146.
Please describe anyadministrative actions available totheowners ofintellectual property rights
toenforce those rights andidentify theagencies responsible forsuchactions. Howwould foreign
parties invoke suchactions?WT/ACC/KAZ/6/Add.2
Page63
--
(d) Special border measures
Question 147.
Please describe thenature oftheborder measures thatwillbeadopted toprevent importation
ofcounterfeit trademarked goods andpirated copyrighted works. When willthislegislation be
enacted?
TheGovernment oftheRepublic ofKazakstan hasinstructed theCustoms Committee toprepare
appropriate amendments totheCustoms Code toprovide for,interalia,special border measures to
prevent theimportation ofcounterfeit trademarks andpirated copyright works.
(e) Criminal procedures
Question 148.
Please describe thenature ofthecriminal actions thatwillbeadopted toprevent trade incounterfeit
trademarked goods andpirated copyrighted works. When willthislegislation beenacted?
On16July1996, theRepublic ofKazakstan enacted amendments to,interalia,itsCriminal
Code toaddress pirated copyrighted works. Therelevant provisions thereof readasfollows:
1) Article 129
Appropriationofauthorship,compulsiontoco-authorship,inclusionintoco-authorshipofpersons
whodidnotparticipate inthecreative activity foradiscovery, aninvention orarationalisation proposal,
disclosure ofessence ofadiscovery, aninvention, arationalisation proposal prior totheapplication
datewithout authors 'consent, -
shallentail correctional activity fortheperiod fromonetotwoyears orafineintheamount
from twotosixminimum wages, orthecaseshallbepassed ontothecomrades 'court.
Bureaucracy andprocrastination intheprocess ofreviewing andintroducing inventions and
rationalisation proposals, evasion from informing aninventor orarationalizator about usage ofhis
inventionorrationalisationproposal,intentionalinaccurateeconomiccalculationorintentionalinaccurate
calculation ofremuneration anddelay inpayment thereof, committed byofficials, -
shallentail correctional activity fortheperiod fromonetotwoyears orafineintheamount
from twotosixminimum wages, ordismissal.
Disclosure ofanyinformation associated with confidential discoveries, inventions and
rationalization proposals without anysigns ofState crime, -
shallentail deprivation offreedom foraperiod ofuptooneyearorcorrectional activities for
theperiod ofuptotwoyears, ordismissal.
2) Article 129-1
Violation ofcopyrights andrelated rights resulted inillegal useofcopyright andrelated rights
items committed forthepurpose ofgaining profit which inflicted large damage totheholder ofthe
copyright andrelated rights, -WT/ACC/KAZ/6/Add.2
Page64
shallentail deprivation offreedom foratermfrom onetothree years withconfiscation of
counterfeit copies aswellasmaterials andequipment forreproduction thereof orafineintheamount
fromfivehundred toonethousand fivehundred minimum wages asestablished bythelegislation of
theRepublic ofKazakstan.
VI. TRADE-RELATED SERVICES REGIME
3. Market Access andNational Treatment
(b) Limitations onthetotalvalue ofservice transactions orassets
Question 149.
Kazakstan states thattheLaw onInsurance dated 2October 1995 doesnotallow more than
95percentoftherisktobere-insured outside ofKazakstan.
Does thisrestriction apply toallinsurers, orsolely toforeign insurers?
Thisrestriction applies toallinsurers (100percentKazakstani legalentities; andKazakstani
entities withforeign participation upto50percent) andallforeign anddomestic re-insurers.
(f) Limitations ontheparticipation offoreign capital
Question 150.
DoUnited States 'banks andinsurance companies receive national treatment despite theEdict
ofthePresident Having theForce ofLawOnBanks andBanking Activities andtheLawOn
Insurance described inthisparagraph?
Foreign insurance companies areallowed toestablish intheformofrepresentative orbranch
offices butmayonlybeengaged inre-insurance activities. Inorder tobeengaged ininsurance activities,
however, aforeign insurer must form ajoint venture withalocal insurance company. Foreign
participation inthiscasemaynotexceed 50percent. Insurance companies withforeign participation
(maximum 50percent) hasthesame rights andprivileges asinsurance companies without foreign
participation.
Foreign banks mayestablish representative orbranch offices butmaynotprovide banking
services until theyareregistered asaKazakstani legal entity which could beupto100percent
foreign-owned. Banks withforeign participation maynotregister inKazakstan ifthetotalregistered
charter fundofallbanks withforeign participation exceeds 25percentoftheoverall registered charter
fundofallbanks inKazakstan.
Banks withforeign participation (partially or100percentforeign-owned) havethesamerights
andprivileges asbanks without foreign participation.
Inaddition, allforeign banks andinsurance companies, regardless ofcountry oforigin, receive
equal treatment.
(i) Provisions concerning anyform ofaid,grant, domestic subsidy, taxincentive orpromotion
scheme affecting trade inservices
Question 151.
Please describe howtheproceeds from theguaranteed loans provided tothetrade services sector
(US$39 million) andtransport services (US$67 million) were applied byloanrecipients.WT/ACC/KAZ/6/Add.2
Page65
Theproceeds fromtheguaranteed loans provided tothetradeservices sector (US$39 Million)
andtransport services (US$67 Million) were applied byloanrecipients asfollows:
- trade services: purchase ofwiderange ofconsumer goods including pharmaceuticals;
- transport service: rehabilitation ofrailroad Drujba toChina.
Question 152.
What istheextent ofState ownership andcontrol ofairline andairfreight service providers?
Freight andpassenger airtransportation inKazakstan arefulfilled bybothState andprivate
aircompanies. Forpassenger transportation, theshare ofStatecompanies is50percentandprivate
companies (excluding foreign companies) is50percent. Forairfreight transportation, theshare of
State companies is35percentandtheshare ofprivate companies (excluding foreign companies) is
65percent.
VII. INSTITUTIONAL BASIS FORTRADE AND ECONOMIC RELATIONS WITH THIRD
COUNTRIES
1. Bilateral orPlurilateral Agreements Relating toForeign Trade inGoods andTrade in
Services
-- Weseekacommitment from theKazakstan Republic thatitwilladhere totheWTO
Agreement onTrade inCivil Aircraft from thedateofaccession.
2. Economic Integration: Customs Union andFreeTrade Area Agreements
- Bilateral agreements providing dutyfreeforcertain products
Question 153.
TheKazakstan Republic Participates inbilateral agreements withMoldova andKyrgyzstan that
permit duty freeaccess forcertain products. GATT 1994 Articles XXIV permits anexception
from most favoured nation treatment forimports from countries participating inafreetrade
areaagreement. Inorder toqualify asafreetrade area, theagreements must cover substantially
alltrade andnotraise barriers tothetrade oftheother WTO members. TheMemorandum states
thattheKazakstan Republic hasexcluded several products from duty-free treatment under these
bilateral agreements, including goods requiring export contracts registration; goods requiring
import licences; andgoods thataresubject toexport tariffs, licences andquotas.
According toParagraph IV.2(e) oftheMemorandum, approximately 26percentoftheofthe
totalvalue ofexports issubject tocontract registration. Virtually alloftheKazakstan Republic 's
agricultural production appears tobeexcluded from duty- freetreatment bythebilateral
agreements asgoods requiring export contracts registration. How doestheKazakstan Republic
intendtosatisfytheGATT1994ArticleXXIVsubstantiallyalltraderequirement,when26percent
oftotalgoods exported, including virtually theentire agriculture sector, isexcluded from coverage
bythese bilateral agreements?
Please notethatTable A9.3ofAnnex 9needs tobeamended. Government Resolution No.895
of12July1996 removed "crude oil--including gascondensate --"(2709) from thelistofproducts
subject toexport contract registration. Inaddition, "Guts, bladders andstomachs ofsheep" (05400000)
and"cotton linters" (140420000) needtobeadded toTable A9.3.WT/ACC/KAZ/6/Add.2
Page66
Asaresult oftheaforementioned amendments, approximately 11percent(instead of
approximately 26percentpreviously) oftotalvalue ofexport (based on1995 export data)issubject
tocontract registration.
OfalltheFTAs listed inSection VI.2ofWT/ACC/KAZ/3, onlytheagreement withMoldova
andtheagreement withtheKyrgyz Republic havebeenratified bybothparties andarepresently in
force. Thelistofexemptions fromfreetradeareagreed uponinprotocols tothese agreements. Since
March 1996, however, Kazakstan nolonger excepts anyproducts fromthefreetrade regime withthe
Kyrgyz Republic, given thattheKyrgyz Republic signed theCustoms Union Agreement.
InthecaseofMoldova:
Thepercentages ofexport andimport excluded fromfreetraderegime withMoldova interms
ofKazakstan 'stotalvalue offoreign export andimport arerespectively:
0.0057 percentand0.0057 percentfor1995; and
0.0015 percentand0.0007 percentforthefirstthree quarters of1996.
Thepercentages ofexport andimport excluded fromfreetraderegime withMoldova interms
ofKazakstan 'stotalvalue oftrade withMoldova arerespectively:
11.57 percentand5.14percentfor1995; and
2.5percentand0.17percentforthefirstthree quarters of1996.
Asmaybenoticed fromtheabove calculations, theGATT 1994Article XXIV "substantially
alltrade" criterion isnotviolated.
Question 154.
Please identify theproducts excluded from duty-free treatment under thebilateral agreements
asgoods requiring permission from theGovernment ofKazakstan forexport andimport,
e.g.,goods ofstrategic importance. Isthere apublished listofthese items?
Yes. Thelistforimport wasprovided inTable A3.2 andthelistforexport wasprovided in
Table A9.2 ofWT/ACC/KAZ/3. Theitems concerned -withexception ofwildanimals andplants
-fallunder Article XXIandoutside ofthecompetence ofGATT 1994.
Question 155.
Please identify anyproducts thatareexcluded from duty-free treatment inoneofthebilateral
agreements which arecurrently inforce, butarenotexcluded from duty-free treatment bythe
other bilateral agreement. Please describe anydifferences incoverage between thetwoagreements.
Differences maynotbeexplained, given thatonlyoneagreement (with Moldova) contains
exceptions from freetrade.
Question 156.
Please identify theproducts, including HStariff numbers, thataretobeexcluded from duty-free
treatment foreachofthebilateral agreements, yettobeimplemented, withLithuania, theRussian
Federation, Ukraine, Uzbekistan andTajikistan.WT/ACC/KAZ/6/Add.2
Page67
Thelistofexemptions fromfreetrade areagreed upon inprotocols tothese agreements. No
protocols existaddressing suchissues withLithuania, Ukraine, Uzbekistan andTajikistan. Please note
thatthere arenogoods excluded from freetrade withtheRussian Federation.
- Customs Union Agreements
Question 157.
WeappreciatetheRepublicofKazakstan'scommitmenttoimplementitscustomsunionagreement,
withtheRussian Federation andBelarus, inawaythatisfullycompatible withWTO requirements.
What isthecurrent status ofKazakstan 'simplementation ofthecustoms union withtheRussian
Federation andBelarus?
TheCustoms Union isinthecourse ofbeing implemented. Thecommon external tariff is
notyetinplace. Thework ontheharmonization offoreign tradelegislation isunder way.Nodetailed
timetable hasyetbeenfixed forthiswork. Assoon assuchatimetable isestablished, itwillbe
communicated totheWTO.
Question 158.
Please identify, including HStariff number, anyproducts thattheKazakstan Republic intends
toexclude from coverage bythecustoms union agreement.
Article 5oftheCustoms Union Agreement foresees thepossibility tointroduce, incritical
situations, temporary exceptions from freetrade. Currently, nosuchexceptions exist.
Question 159.
WillKazakstan 'strade average tariff rateincrease asaresult ofimplementation ofthecommon
external tariff?
Given thatthecommon external tariff isnotyetinplace, itisdifficult topredict whether or
notKazakstan 'strade average tariff ratewillincrease.WT/ACC/KAZ/6/Add.2
Page68
LIST OFATTACHMENTS1
- TaxCode -Articles 3and4;
- TaxCode -Section VI.Taxation ofSubsurface Users;
- Customs Code -Chapter 12;
- Customs Code -Articles 115and116;
- Customs Code -Articles 122to133;
- Presidential Edict No.2823 Having theForce ofLawConcerning Special Economic Zones
intheRepublic ofKazakstan;
- Government Resolution No.586of13May1996 OnState Procurement ofGoods; and,
- LawoftheRepublic ofKazakstan Concerning Currency Regulations of24December 1996.
1Available intheSecretariat (Accessions Division, Room 1126) forconsultation.