Below are the changes for legal entities.

1. The Law of the Republic of Kazakhstan “On currency regulation and currency control” No. 167-VI ЗРК dated 2 July 2018 (hereinafter – the Law).

   In accordance with paragraph 8 of clause 3 of Article 1 of the Law residents of the Republic of Kazakhstan in the sphere of currency regulation and currency control shall be branches (representative offices) of foreign non-financial companies, that are permanent institutions (PIs) of such foreign non-financial companies in the Republic of Kazakhstan in accordance with the Code of the Republic of Kazakhstan “On other mandatory payments to the budget” (The Tax Code), with the exception of branches (representative offices) of foreign non-financial companies, recognized as non-residents of the Republic of Kazakhstan in accordance with clause 4 of Article 1 of the Law.

As it follows from the above norm, not all branches (representative offices) of foreign non-financial companies from 1 July 2019 become residents under the Law. Only those that, according to the Tax Code are PIs for the purposes of tax regulation. At that, settlements between residents and branches (representative offices) of foreign non-financial companies classified as residents should be made only in the national currency (tenge), except for settlements under contracts concluded before 1 July 2019.

1. II. The rules of exercising export–import currency control in the Republic of Kazakhstan No. 42 dated 30 March 2019 (hereinafter – The Rules 42).

1) In accordance with p. 10 of the Rules 42 foreign currency contracts for export and import (goods, works, services) amounting to over 50,000 US Dollars in equivalent, as well as contracts without specifying the contract amount, shall be subject to accounting registration, in accordance with paragraph 63 of the Rules 42, if the exporter or importer has a valid as of 1 July 2019 foreign exchange contract for export or import of works and services without the accounting number for the amount exceeding 50,000 (fifty thousand) US Dollars in equivalent, the exporter or importer should apply for the accounting number to an authorized bank (its Branch) or a territorial Branch of the National Bank not later than six (6) months from the date of entry into force of the Rules, but before the start of performance of obligations under such a contract.

2) In accordance with p. 27 of the Rules 42 when switching to a service at another bank, a new accounting number shall not be assigned to the Contract.

3) In accordance with p. 32 of the Rules 42 the authorized bank, which is the accounting registration bank, is allowed to terminate business relations based on Article 13 of the AML/FT Law, at that the ground for withdrawing an foreign exchange agreement for import or export from the accounting registration shall be s. p. 22 of p. 48 of the Rules 42.

4) In accordance with p. 11 of the Rules 42 the exporter or importer shall address for obtaining the accounting number before commencing the fulfillment of obligations under a foreign exchange contract. At that, in case of violation of the requirement of this norm, the authorized bank shall inform the National Bank about violations of the currency legislation of the Republic of Kazakhstan that have become known to it, in accordance with the violation card in the form, according to Appendix 1 to the Rules 40.

III. The Rules of conducting foreign exchange transactions in the Republic of Kazakhstan No. 40 dated 30 March 2019 (hereinafter – the Rules 40).

1) In accordance with p. 11 of the Rules 40 for transactions of legal entities – residents / residents-branches (representative offices) of a foreign non-financial company using a corporate payment card there are established the obligations to submit documents to an authorized bank within thirty business days from the date of such a payment and (or) money transfer in the amount of the transaction equal to 50, 000 US Dollars in equivalent and higher.

2) In accordance with p. 13 of the Rules 40 payment and (or) money transfer under a currency transaction, the conduct of which can be directed to withdrawing money from the Republic of Kazakhstan and determined in p. 2 of the Article 21 of the Law, shall be carried out when the resident provides permission to an authorized bank to transfer of the information on this payment and (or) transfer money to the currency control authorities.

3) In accordance with pp. 14 and 15 of the Rules 40 a resident and a non-resident, when making a reportable in accordance with Article 15 of the Law payment and (or) money transfer in the amount equal to fifty thousand US Dollars in equivalent and above, shall provide information on a currency transaction in the form according to Appendix 2 to the Rules 40, while in accordance with p. 16 of the Rules 40 it is allowed for an authorized bank to independently specify the information on the basis of documents submitted by the customer.

4) In accordance with p. 19 of the Rules 40 resident legal entities shall buy non-cash foreign currency in one authorized bank on one business day for national currency for purposes not related to the performance of obligations in foreign currency in the amount not exceeding one hundred thousand US dollars in equivalent. The purposes not related to the performance of obligations in foreign currency shall include the transfer of foreign currency to own accounts in foreign banks, gratuitous money transfers in foreign currency, and placement of foreign currency to accounts in authorized banks. At that, in case of exceeding the threshold value of one hundred thousand US Dollars in equivalent – the authorized bank shall refuse to conduct a transaction.

5) In accordance with p. 21 of the Rules 40 a resident legal entity when requesting non-cash foreign currency purchase for national currency in the amount greater than the equivalent of one hundred thousand US Dollars shall provide the purpose of the purchase and the amount of foreign currency, and shall also provide a foreign exchange contract. At that, the authorized bank shall verify the purchase goals and the amount of foreign currency specified in the application with the foreign exchange agreement confirming the purpose and amount of foreign currency purchase, as well as the available information about previously purchased foreign currency for national currency in accordance with the Rules based on this foreign exchange contract.

It is not allowed to exceed the total amount of purchases of non-cash foreign currency for national currency under one foreign exchange contract calculated on the basis of applications of a resident legal entity over the foreign exchange contract amount.

6) In accordance with p. 22 of the Rules 40 it is allowed to use non-cash foreign currency purchased in accordance with pp. 19 and 20 of the Rules 40, for other purposes related to the fulfillment of obligations in foreign currency under another foreign exchange agreement when the resident legal entity submits to the authorized bank an additional application to the previously executed application according to which non-cash foreign currency was acquired. At that, provision of the additional application is controlled by the authorized bank.

1. IV. The Rules of monitoring currency transactions in the Republic of Kazakhstan No. 64 dated 10 April 2019 (hereinafter – The Rules 64).

• In accordance with pp. 9 and 18 of the Rules 64 there should be registered a foreign exchange

agreement on the capital movement (and opening accounts in foreign banks), which provides receipt of property (money) in Kazakhstan / transfer of property (money) from Kazakhstan in the amount exceeding five hundred thousand US Dollars in equivalent (as well as foreign currency contract without specifying the amount of the contract). The term of applying for registration – prior to the start of the fulfillment of obligations / conducting transactions using an account in a foreign bank. . In this case, the currency regulation regimes are optimized, the currency contracts under which, prior to the implementation of the Rules 64, RC / NE was received, except for those specified in pp. 45 and 47 of the Rules 64, shall be considered accepted for the accounting registration. The resident shall apply for assignment of the accounting number to a foreign exchange agreement on the capital movement to the territorial Branch of the NBRK, located at the place of its permanent residence (for an individual) or location (for a legal entity).

Below are the changes for individuals.

1. I. The Law of the Republic of Kazakhstan “On currency regulation and currency control” No. 167-VI of the Legislation of the Republic of Kazakhstan dated 2 July 2018 (hereinafter – the Law).
2. II. The Rules of conducting foreign exchange transactions in the Republic of Kazakhstan No. 40 dated 30 March 2019 (hereinafter — the Rules 40).
   III. The Rules of monitoring foreign exchange transactions in the Republic of Kazakhstan No. 64 dated 10 April 2019 (hereinafter — the Rules 64).

1) In accordance with p. 7 of the Rules 40 in the cases provided for by paragraph 4 of Article 7 of the Law on Currency Regulation and Currency Control, an individual shall transfer money under a currency transaction in the Republic of Kazakhstan, from the Republic of Kazakhstan and to the Republic of Kazakhstan without opening and (or) using an account with an authorized bank for the amount not exceeding the equivalent of ten thousand US Dollars. At that, in accordance with p. 3 of Article 7 of the Law payments and (or) money transfers under capital flow transactions, as well as payments and (or) money transfers under foreign exchange contracts for which, in accordance with this Law, it is required to receive the accounting number, shall be made only through bank accounts.

2) In accordance with p. 13 of the Rules 40 payment and (or) money transfer under a currency transaction, the conduct of which can be directed to withdrawing money from the Republic of Kazakhstan and determined in p. 2 of the Article 21 of the Law, shall be carried out when the resident provides permission to an authorized bank to transfer of the information on this payment and (or) transfer money to the currency control authorities.

3) In accordance with pp. 14 and 15 of the Rules 40 a resident and a non-resident, when making a reportable in accordance with Article 15 of the Law payment and (or) money transfer in the amount equal to fifty thousand US Dollars in equivalent and above, shall provide information on a currency transaction in the form according to Appendix 2 to the Rules 40, while in accordance with p. 16 of the Rules 40 it is allowed for an authorized bank to independently specify the information on the basis of documents submitted by the customer.

4) In accordance with p. 9 of the Rules 64 foreign exchange agreement on the capital movement is subject to registration, which provides for the receipt of property (money) in the Republic of Kazakhstan/ transfer of property (money) from the Republic of Kazakhstan for the amount exceeding five hundred thousand US Dollars in equivalent (as well as foreign exchange contracts without specifying the amount of). The terms of applying for accounting registration – prior to the start of fulfillment of obligations. In this case, the currency regulation regimes are optimized, the currency contracts under which, prior to the implementation of the Rules 64, RC / NE was received, except for those specified in pp. 45 and 47 of the Rules 64, shall be considered accepted for the accounting registration.