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Atameken's contribution: More than 70 initiatives are reflected in the new Administrative Code

28 December 2017
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Today on 28th of December the Head of State signed the Law of the Republic of Kazakhstan "On Amendments and Additions to the Code of the Republic of Kazakhstan on Administrative Offenses" (hereinafter - the Law), the Akorda press-service reports.

The main goal of the Law is humanization and improvement of administrative and tort legislation. The adoption of this law will reduce administrative pressure on the business of legal entities in Kazakhstan, improve the business climate in the country and increase entrepreneurial activity.

For 2 years NCE RK "Atameken" took an active part in drafting the bill, which resulted in the adoption of more than 70 conceptual proposals of the National Chamber.

Thus, starting from 1st of January 2018 the following provisions will be applied for domestic entrepreneurs:


1. Exemption from liability if the offense is of minor significance.

The institute of insignificance of the offense was returned in the Code of Administrative Offenses. Thus, if an administrative offense is committed unintentionally or the offense is insignificant and did not cause significant damage to the budget to the state, life and health of people - state bodies and judges may not involve entrepreneurs in administrative responsibility and confine themselves to an oral observation.

2. Problematic issues of confiscation of property of legal entities were resolved.

"Atameken" studied problematic issues of confiscation of property of legal entities. As shown by the analysis in the current Code of Administrative Offenses, confiscation of property was used for offenses that did not affect the budget and security of the state in any way.

In this connection, according to some articles of the Code, in the sphere of customs regulation, confiscation of property was completely excluded from the four CoAOs (Part 1, Article 528, Part 1, Article 532, Part 1, Article 543, Part 2, Article 551; ), an alternative to confiscation of property was introduced for 4 compositions (Part 5, Article 281, Parts 1-1 and Part 3, Article 543, Article 550), two alternatives to confiscate vehicles (Part 3 of Art. 543, article 550).

 3. Legal entities will pay fines by half.

According to the amendments to the Code of Administrative Offenses, the institute of reduced production now extends to legal entities, the so-called 50% discount on fines. Thus, if an entrepreneur has committed an offense and voluntarily pleaded guilty, he has the opportunity within 7 days to pay a fine with a 50% discount on more than 350 CoAOs members.

4. Employees of regional chambers of entrepreneurs are entitled to protect the rights and interests of SP in courts.

At present, many individual entrepreneurs are faced with the problem of the inability to attract NCE employees as defenders along with lawyers, since the current norms of the Code of Administrative Offenses do not provide for this. This omission brought to the individual entrepreneurs a lot of inconvenience and additional financial expenses when protecting their rights in courts.

In this regard, by the proposals of NCE changes were introduced to the Administrative Code, according to which the regional chambers, along with lawyers, can competently represent and protect the interests of individual entrepreneurs.

 5. An entrepreneur will be able to operate uninterruptedly, in the event of the elimination of comments issued by state bodies.

According to the provisions of the Law, in the event of the elimination of comments issued by state bodies, the business will be able to resume its activities within 10 days, despite the previously issued 6-month ban on carrying out entrepreneurial activities.

Resumption of the permit / license is provided for the most problematic 27 issues of the Code of Administrative Offenses (Parts 1 and 2 of Article 187, Part 1 of Article 191, part 3 of Article 281, part 5 and 12 of Article 282, part 2 of Art. 333, part 1 of article 427, part 1,2,3,4,5,6,7,8,9,10 of article 445, part 1,2,3,4 of article 445-1, part 3 of art. 462, part 1 of article 464, part 1 of article 485-1, part 2 of article 489-1, part 2 of article 604).

6. Administrative fines for legal entities have been reduced.

Currently, the Code of Administrative Offenses has provided disproportionately high penalties for committed offenses. Because of which the business of domestic companies carried large financial costs, investments in the development of enterprises, human resources, and innovations were reduced.

          In connection with this, within the humanization of the administrative legislation of more than 150 compositions of the Code of Administrative Offenses, fines were reduced by an average of 30%.

 7. The Institute for Prevention was expanded for 45 compositions, whereas before the changes, there were only 14 articles in the Code providing for a warning for legal entities.

 8. In 30 compositions, the existing sanctions were replaced by less repressive penalties. Excluded administrative penalties in the form of suspension of the license, deprivation of the license, confiscation of property, and the replacement of fines with a percentage of fixed MCI.

In addition, the Law also provides for the following innovations:

·         fines have been reduced from 40% to 20% for exceeding the amount of actually calculated corporate income tax for the tax period over the amount of estimated advance payments during the tax period of more than twenty percent, if this action does not contain any signs of a criminal offense (Part 3, Article 278 );

·         changes were made that provide for the possibility to suspend the validity of not only the permitting document, but only its part, which will cover 120 administrative offenses;

·         for courts and state bodies, a compulsory requirement will be introduced to impose a penalty in the form of a warning when considering administrative violations for which alternative sanctions are provided in the form of a warning or a fine, provided that there are no aggravating circumstances in the case;

·         the responsibility for non-payment of the annual license fee (storage and retail sale of alcohol products) (Part 8, Article 282), on which they appealed to NCE with complaints and hundreds of entrepreneurs in the country were affected;

·         an alternative is introduced to suspend business activities, in case of non-compliance with orders, submissions, decisions issued by state bodies;

·         the time limits for bringing to justice in the field of finance are reduced from 5 to 3 years;

·         provides for the possibility of reducing the amount of an administrative fine to 30% of the total amount for legal entities in establishing mitigating circumstances;

·         administrative liability against legal entities on 8 compositions is excluded (Article 188; subparagraph 9) part 5 of Art. 281; part 8 and 9 of Art. 282; Part 7 of Art. 287; Part 1 of Art. 356; Art. 467; Art. 574; Part 1 of Art. 584;);

·         for violation by the taxpayer of the deadline for submitting a tax application to the state revenue agency on registration for VAT registration, a fine calculated as a percentage of 10% to 30% of the amount of taxable turnover for the period of non-registration will now be calculated in fixed form (50 MCIs) for all categories of business (Article 269);

·         for non-payment, incomplete payment or untimely payment of indirect taxes within the timeframe established by the tax legislation, the fine calculated as a percentage of 30% to 50% of the amount of the unfulfilled tax liability will now be calculated on a fixed basis (from 30 to 50 MCI) (Article 287).

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