DEFENDING THE RIGHTS OF FOREIGN INVESTORS
Astana, June 21: An inaugural meeting took place this week in Astana of the working group on the protection of foreign investors’ rights in Kazakhstan. Otherwise known as “the investors’ ombudsman”, the group is the responsibility of the National Agency for Exports and Investment, Kaznex Invest. Kaznex Invest comes under the Ministry of Industry and New Technologies, and the Minister, Asset Issekeshev, who is also a Deputy Prime Minister, chairs the group.The idea of creating the working group has been taken from the practice in a number of other countries, such as Russia, the US and South Korea. The group plans to meet at least once a quarter and will carry out regular surveys of investors in order to identify problem areas.
As well as the Ministry of Industry and New Technologies, the group brings together the heads of a number of ministries and state bodies who come into contact with foreign investors: the General Prosecutor’s Office; the State Security Service; the Supreme Court; the Oil and Gas Ministry; the Interior Ministry; the Ministry of Justice; the Ministry of Finance; the Ministry of Economy and Budget Planning; the Ministry of Labor and Social Security; the Emergencies Ministry; the Ministry of the Environment; and the Agency for Fighting Economic Crime and Corruption.
According to the World Bank, Kazakhstan currently stands at number 49 in the “Ease of Doing Business” table, out of 185 countries ranked. And the World Bank has welcomed a number of improvements made to doing business in Kazakhstan in recent years.
In 2008, Kazakhstan made paying taxes easier by lowering sanctions for late payments of taxes. Registering property and getting credit became easier in 2009, and these processes have continued to improve.
A signifi cant step forward for investors was made last year, when Kazakhstan strengthened investor protection by regulating the approval of transactions between interested parties and making it easier to sue directors in cases of prejudicial transactions between interested parties.
And there have already been three major improvements this year, according to the World Bank. Starting a business was made easier, when the requirement to pay in minimum capital within three months after incorporation was removed. The process of getting credit was simplified, when Kazakhstan strengthened its legal framework for secured transactions by introducing new grounds for relief from an automatic stay during rehabilitation proceedings.
Also, Kazakhstan strengthened its insolvency process by introducing an accelerated rehabilitation procedure; extending the period for rehabilitation; expanding the powers of and improving qualification requirements for insolvency administrators; changing the requirements for bankruptcy filings; extending the rights of creditors; changing regulations related to the continuation of operations; introducing a time limit for adopting a rehabilitation plan; and adding court supervision requirements.
This latest move of introducing an investors’ ombudsman could well see Kazakhstan rise still further in the World Bank’s table for ease of doing business.