One of the main problems facing the owners of companies (considering the specifics of Kazakhstan mentality and legislation) is whether to provide an executive body/director with sufficient authority to manage the company. On the one hand, having too much freedom may result in all kinds of abuse by the managers. On the other hand, excessive restrictions may paralyze the company and sometimes lead to absurd situations when a simple transaction requires consent of the owner and a mandatory convocation of a general meeting. This is especially complicated when the company is owned by several parties some of whom are located overseas. In this situation, any step towards developing a company (opening of a point of sale, purchasing equipment, executing a lease contract) requires compliance with onerous and complicated procedures.

Therefore, from the outset a balance of authority needs to be agreed on and established in the company’s foundation documents. In the many years of our work, we have provided assistance in drafting such documents to hundreds of our clients working in a wide range of industries. This has allowed to prevent many potentially conflict situations, which our clients have appreciated and subsequently come back repeatedly seeking our help on other important issues:
- drafting various internal documents (including complex documents, such as a Code of Corporate Governance);
- convening and conducting meetings of shareholders/participants, board of directors and other management bodies;
- drafting various agreements and other documents required in the course of the activity of a company, branch or representative office;
- conducting trainings and workshops for HR managers and in-house lawyers and a host of other things.

Our lawyers collaborated with the World Bank in relation to improvement of the Kazakhstan legislation in the area of corporate governance.

The M&A work is one of the significant parts of our practice. In Kazakhstan, mergers and acquisitions normally take the form of acquisition by one company of shares or participatory interests in another company. ‘Reorganisations’ in one of the forms permitted by the legislation of Kazakhstan (merger, consolidation, split-up or spin-off) or acquisitions of assets of one company by another are less frequent. An important aspect here is to comply with permitting procedures. In certain cases such a transaction may be subject to the anti-monopoly legislation. Sometimes additional permitting documents are required (for example, where interest in a subsoil user is put up for sale). In addition, a merger requires that all corporate procedures are strictly followed (see section “Corporate”) by the seller and the buyer, and sometimes even by the target. Over many years, our firm has successfully carried out M&A transactions for our clients. Often such transactions are executed between a foreign and a Kazakhstani company, or between two foreign companies. In most cases, a Kazakhstani company is the target of acquisition. These transactions often require legal audit and advice on the Kazakhstani legislation.

Debt recover; bankruptcy; liability for the quality of goods, works and services; labour, patent, insurance and many other issues, are at the heart of lawsuits. As professionals, we do our best to make sure you do not have to go court to have your problems solved. However, if that happens, we stand ready to represent you in court or arbitration, including:
- developing a defence strategy for our client;
- drafting statement of claims, motions and any other process documents;
- representing our clients in negotiations with the counterparty in a dispute;
- preparing amicable settlement agreements.

If you need to avail yourself of legal help in other countries, we will help you find professionals using our long-standing relationships with some of the world’s best law firms.

Our lawyers have successfully represented the government, state companies and organisations of Kazakhstan, as well as private enterprises, in arbitrations and litigations in Asia, Europe and the United States.

Today, under a new labour legislation the importance of an employment agreement as an instrument regulating the relations between the employee and the employer is ever increasing. A properly made employment agreement helps avoid costs associated with payments and compensations to the employees, lawsuits, dismissals and search for new staff. Most importantly, it helps avoid disputes between the parties to the employment relationship. With our long-standing history of working with foreign companies, we fully understand the most pressing issues they face:
- employment of foreign labour force;
- managing relationships between the foreign employer and Kazakhstani employees;
- securing work permits for foreign staff;
- applying Kazakhstan labour legislation to the relations with foreign labour force.

It is not rare that foreign companies wish to have their standard employment contracts adapted to suit the requirements of the Kazakhstan legislation. Often this involves significant amendment of documents, especially due to the fact that Kazakhstan labour legislation is in many ways different from western practices. Adapting the documents properly and correctly requires a deep knowledge and understanding of the essence of the relations, and competence.

Not all law firms have this kind of competence and understanding of the specifics of labour relationships between employees and employers who come from different jurisdictions. What we offer to our clients is an extensive body of knowledge and skills which has been accumulated over many years:
- services in drafting employment contracts – standard and customized (for example, for executive management);
- advice on obtaining work permits for foreign employees;
- training courses and seminars for HR specialists;
- assistance in developing and implementing a document control system and drafting templates of a company’s internal documents;
- representing employers or employees in labour disputes.

Recently, there has been a growing trend in the Kazakhstani entrepreneurial community to purchase foreign franchise licenses, especially the Russian ones. Under a franchise contract, choosing the proper law for the contract is a serious challenge. Foreign franchisors are not willing to have their contracts regulated or interpreted by Kazakhstan law. At the same time, the Kazakhstan legislation contains a number of provisions that apply to a franchise contract, whether the parties like it or not. As a result, Kazakhstani franchisees have no choice but to consent to their contracts being regulated by a foreign law, while foreign franchisors have to adapt their contracts to the mandatory requirements of the Kazakhstan legislation.

Despite the fact that the Russian and Kazakhstan legal systems are very much alike, when it comes to the regulation of relations arising under a franchise contract there are a number of peculiarities which prevent the Russian contracts from being used in Kazakhstan unless such contracts are first properly adapted. Our experts have a wealth of experience in multi-faceted support to franchise projects—from negotiating the provisions of a contract and drafting documents to the registration of a title to intellectual property and legal protection of the parties. More specifically, we have assisted in bringing to the market an international fast food chain, clothing and accessories retailers, a department store chain, gas stations, and a hotel group.

One difficulty that the players in international trade face is the understanding of, and compliance with, the legislation. Advice on customs, currency and tax legislation is something that importers and exporters badly need. The establishment of the Customs Union and the Eurasian Economic Union (EAEU) has brought about significant changes in their business. The laws of these two international organisations establish common rules for moving goods and as such must be respected when carrying out trade transactions.

We provide advice to suppliers and importers of foreign goods, including on customs tariffs and fees, import quotas and prohibitions, indirect taxes, licensing, and technical regulations.

For our Kazakhstan producers and exporters we offer our assistance in export duties, advice on applicable quotas and export prohibitions, export control and licensing requirements, and on the introduction and application of government measures to protect domestic markets.

Our experts have extensive experience in accompanying cross-border transactions sale and purchase and distribution of goods, as well as trade financing.

Our multilateral approach is what we consider our strength: we provide advice on currency and anti-monopoly regulation, taxation and other legal issues which often arise when effecting and implementing such kind of transactions. We also represent our clients in arbitrations and litigations relating to trade activities, including disputes with customs authorities on issues pertaining to customs law.

Many companies need financing; however loans from Kazakhstani banks are often too expensive so the companies have to turn to western capital markets. Raising money abroad requires special attention to all legal details—drafting documents, devising the structure of the transaction, correct evaluation of the legal status of the company to be financed. An added complexity is that the standards adopted by western financial institutions are often very different from those the Kazakhstani companies are used to be working with.

The paramount task for lawyers here is a deep understanding of both the western standards and the requirements of the Kazakhstan legislation, so that they can apply foreign rules of financing to the Kazakhstan legal environment with no error.

We have extensive experience of providing legal support to financing transactions between large companies and leading financial institutions of the United States, Europe and Asia. Our lawyers have participated in numerous financial transactions involving a Kazakhstan element, Eurobond issues and IPOs among them.

We offer the following services:
- drafting financing and security agreements;
- carrying out legal audit (legal due diligence) of the borrower or issuer;
- issue of legal opinions;
- assistance in drafting securities prospectuses and obtaining the necessary permitting documents.

Any company operating in Kazakhstan may become subject to anti-monopoly regulation. This may be about unfair competition, pricing policy, cooperation agreements, sale and purchase of shares or interest in companies, and many other issues. Not only natural monopolies but also many other enterprises may become subject to the anti-monopoly legislation, both for their business activity as a whole and for certain transactions. For example, sale and purchase of a 50-per cent interest in a Kazakhstani LLP may require consent of an anti-monopoly agency if the buyer is a large group of companies with an annual turnover exceeding a prescribed threshold.

We offer our clients advice in this field, assistance in drafting and preparing the necessary documents, and representing their interests before the anti-monopoly authorities and courts.

From our experience, we know that companies need tax advice when they plan new directions for their business or when then engage in certain types of transactions. BMF Partners offer advice on Kazakhstani taxation of companies as a whole (or a company’s certain lines of business) and of certain transactions. With our developed network of correspondents in other countries, we can help develop schemes to optimize cross-border taxation of international holding structures.

As a key sector of the country’s economy, subsoil use is governed by a great number of regulating documents. Notably, regulation applies not only to subsoil users but also to companies, which supply subsoil users with goods, works and services. Apart from that, the law establishes certain restrictions on transactions with shares/interest in companies that are subsoil users.

Our experts have a wealth of experience in transactions relating to subsoil use, obtaining permitting documents, and advising on purchases of goods, works and services in the subsoil use sector.

You cannot do without the help of Kazakhstani lawyers in projects that involve real estate. Given that all transactions with real estate located in Kazakhstan are governed by Kazakhstan law, any disputes arising out of those transactions should also be resolved only before Kazakhstani courts.

Our services include:
- comprehensive support to developer and construction projects;
- advising on construction and real estate regulatory environment in Kazakhstan;
- assistance in transactions pertaining to real estate assignment and encumbrance.

With our international experience and knowledge of Kazakhstan legislation, we can become a strong link in your team. BMF Partners provide an effective assistance to our clients in this field—from drafting real estate contracts to registration of titles. Our lawyers have participated in a number of transactions in international financing of construction of large industrial facilities in Kazakhstan.

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