Legal Framework -- September 1998

Foreign Investment Law	The Foreign Investment Law provides equal treatment for domestic and foreign investors. The law also gurantees non-expropriation and lifted all restrictions on profit repatriation. The law also includes a number of important provisions aimed to guarantee investor rights.
Corporate law	Two background laws (the joint stock company law and the law on enterprises) were enacted in 1991 when economic reforms begun. Now, after seven years of economic reform experience, certain shortfalls within these laws became obvious. However, they include a number of important provisions and have played a key role in the establsiment of a free market environment. According to these laws, companies must be registered and the relevant state regulatory authroities must be notified.
Bankruptcy law	Kyrgyzstsan became the first CIS country to introduce the Bankruptcy Law in December 1993. The law describes insolvency as inability of debtor to repay its obligations in time. Creditors have a right to initiate bankruptcy procedures through court, which appoints a liquidator, subject to meeting certain qualification requirements.
Expected new laws	The Government plans to submit (by the end 1998) draft laws to the Parliament on Investment Funds, Insurance Companies, and Leasing, thus making a crucial step in creating a favourable legal framework for domestic institutional investors. Another improtant step in improving the legal and regulatory framework of the securities market will be the enactment of the Law on the Securities Market (also expected by the end of 1998). Mortgage laws, Land Codes and a law on land registration are among the laws which should be approved by the Parliament and be enacted by the end 1998 or early 1999.

© Kazkommerts Securities 1998. Please cite source when quoting.

This report has been prepared by Kazkommerts Securities and provided solely for information purposes to recipients only. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. This information does not constitute an offer to buy or sell securities. Kazkommerts Securities or its affiliated persons may be buying, selling or holding long or short positions, acting as investment bankers, be represented on the Board of the issuers in securities mentioned herein. This report is not intended for the use of private investors. Investment in Kazakhstan markets is an extremely risky activity and many persons, physical and legal, may be completely or partially restricted from dealing in the Kazakhstan securities markets.

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