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Creation and registration of LLP with foreign participation in the Republic of Kazakhstan
A limited liability partnership is the main form of doing business in the Republic of Kazakhstan.
A non-resident-founder must consider a number of limitations provided by legislation of the Republic of Kazakhstan when incorporating a limited liability partnership. The limitations below are connected with the national security and a public order in Kazakhstan.
The Law «On The Security Activity»
An activity of a security organization of a foreign country is prohibited in Kazakhstan. A foreign legal entity, a legal entity with a foreign participation, foreigners, and stateless persons may not:
1) conduct all types of security activities;
2) and/or incorporate or to be a founder (participant) of a private security organization.
The Law «On Mass Media»
It is forbidden for a foreign individual or a legal entity or a stateless person to directly and/or indirectly own, use, dispose of and/or control more than 20% of shares (participatory interest, stock) of a legal entity which owns any mass media in Kazakhstan or carries out any activity in this sphere.
The Law «On the National security of the Republic of Kazakhstan»
A foreign legal entity and a foreigner are prohibited from:
controlling or operating the main communication lines without creating a legal entity on the territory of the Republic of Kazakhstan;
acquiring or owning whether independently or as a part of a group of individuals more than 10% of voting shares or participatory interest or stock of an organization which owns and manages or uses communication lines of a domestic long distance and (or) a international telecommunication, without consent of the authorized bodies in the field of communication and information, as well as national security.
without a positive decision of the Government of the Republic of Kazakhstan, based on the conclusion of an authorized body in the field of communications and information, agreed with the national security bodies owning, using, disposing of and controlling, whether directly and (or) indirectly in aggregate more than 49% of the voting shares or a participatory interest, stock of a legal entity which is carrying out an activity in the field of telecommunications as a operator of a long distance and (or) a international telecommunication, owning land (cable, including fiber-optical, radio relay) communication lines.
In addition to the above, there are certain requirements for non-residents-founders, who are individuals. If a founder of a limited liability partnership is a citizen of a foreign state that is not a CIS's member or has no visa-free regime with the Republic of Kazakhstan, according to the Law «On Human Migration», an incorporation of a legal entity, and also a participation in an authorized capital of a commercial organizations by joining into structure of participants of legal entities are forbidden to foreigners who haven't received entry visas as business immigrants.
According to the Law «On Human Migration», a business immigrant during a two month term from the date of entering on the territory of Kazakhstan is obliged:
For reference: After creating a partnership and opening its own bank account, the founder, in whose name the savings account is opened, is obliged to transfer money from this account to the partnership account within 5 (five) business days.
In case of the choice of a name of a limited liability partnership in a foreign language, according to the Law «On the Languages in the Republic of Kazakhstan», the name of a joint or foreign organization has to be specified with its transliteration in the state and Russian languages.
Thus, a non-resident-founder has to comply the above restrictions and requirements for registering a limited liability partnership in the bodies of justice of the Republic of Kazakhstan.
The state registration of a limited liability partnership with a foreign participation is carried out according to the Law «On The State Registration of Legal Entities and Record Registration of Branch Offices and Representative Offices».
A non-resident-founder, which is a legal entity unless otherwise established by the international treaties ratified by Kazakhstan, shall submit:
The documents issued by legal entities of foreign states which are not members of «The Hague Convention Abolishing the Requirement for Legalisation for Foreign Public Documents» are subject to obligatory legalization. In case of an accession, documents are subject to apostilization. The documents issued by legal entities of the countries entering into the CIS do not need to be apostilled or legalized as long as the states entering into the CIS have signed the Convention on legal aid and legal relations on civil, family and criminal cases. It is enough to notarize them.
In case of appointment of a citizen of a foreign state to the position of a chief executive officer of a limited liability partnership, this citizen has to be registered with the local tax authority and get an Individual Identification Number (IIN) according to the Law «On National Registers of Identification Numbers».
Furthermore, in spite of the fact it isn't provided by this law, the non-resident-founder individual must obtain the IIN, the non-resident-founder legal entity must obtain a Business Identification Number (BIN), has to be registered with the local tax authority because at submission of documents on registration of Limited liability partnership it will be refused in acception of documents in case of absence of the IIN (for non-resident-founder individual) and absence of the BIN (for non-resident-founder legal entity).
Thus, when incorporating and registering of a limited liability partnership in Kazakhstan the conditions and provisions above have to be complied by a non-resident-founder.
Frequently asked questions when registering a company in Kazakhstan by foreign citizens.
1. Is it possible for a foreign citizen to open a company in Kazakhstan and are there any restrictions?
Foreign citizens can register a company in the form of a limited liability partnership (LLP) in the same manner as citizens of Kazakhstan. But there is one requirement: C5 Business Visa is required for foreign individuals. For foreign legal entities, a business visa is not required.
For reference: A visa of category C5 “business immigrants" can be single (up to 90 days, period of stay: for the entire period of stay) and multiple (up to 2 years, and for ethnic Kazakhs up to 3 years / period of stay: for the entire period of stay).
A single-entry visa is issued by the diplomatic representatives of the Republic of Kazakhstan on the basis of an invitation if the following documents are available:
2) a medical certificate confirming the absence of diseases, the presence of which prohibits the entry of foreigners and stateless persons into the Republic of Kazakhstan;
3) medical insurance;
4) a certificate of the presence or absence of a criminal record issued by an authorized body of the country of citizenship or permanent residence;
5) certificates on the presence or absence of a ban on entrepreneurial activity on the basis of a court decision issued by an authorized body of the country of citizenship or permanent residence.
Visa recipient must be of legal age.
2. Is it possible for foreign citizens to open a company remotely, being outside of Kazakhstan?
The creation of a legal entity is prohibited to foreign individuals who have not received a C5 Business Visa; accordingly, it is not possible to remotely open a company.
Foreign citizens - business immigrants are required to register a commercial organization or join the membership (shareholders) within 2 months from the date of entry into Kazakhstan.
3. Who is easier to register a company: a foreign individual or a foreign legal entity?
It is easier for a foreign legal entity to register a company, becauseit does not apply to a C5 business visa. A foreign individual must first obtain a C5 business immigrant visa.
4. What is the list of necessary documents for opening an LLP by foreign citizens?
To register a company in Kazakhstan, foreign citizens must have the following:
a) Business visa C5;
b) Individual identification number (IIN) issued by tax authorities;
c) Notarized translation of the passport into Russian and Kazakh;
If these documents are available, a foreign citizen should receive an electronic digital signature (EDS) at the Center for Public Services (PSC) and register the LLP in electronic form through the electronic government portal.
Provided that the applications are correctly filled out and a full package of documents is available, registration of the LLP for foreign citizens in Kazakhstan can be performed within 1 business day.
5. Name of company and availability of restrictions.
There are certain requirements for the name of the company in Kazakhstan. The name of the LLP should not completely or in substantial part duplicate the name of legal entities registered in the Republic of Kazakhstan.
The name of the joint, foreign organizations should be with obligatory transliteration in the Kazakh and Russian languages. That is, if you want to indicate the name in Latin, then transliteration in brackets after the main name will be required. There are no transliteration requirements only when choosing a name in Russian and / or Kazakh.
6. What is the minimum size of the authorized capital and terms of its replenishment?
The authorized capital is the property and money invested by the founders to start a commercial activity.
The minimum authorized capital for small businesses is 0 tenge, and for medium and large businesses - 100 MCI (monthly calculation indices).
In 2019, 1 MCI is equal to 2525 tenge. The terms for making contributions (replenishment) of the authorized capital is established by the decision of the founders, while the term for replenishment cannot exceed 1 year from the date of registration of the LLP.
7. Should there be a legal address at the time of registration of the LLP, and also whether it is possible to use the apartment as an office?
Currently, registration of an LLP is not possible without a legal address.
Many landlords do not want to provide premises for a legal address if the LLP is not yet registered. But it is possible to conclude a preliminary lease agreement and subsequently, after the registration of the LLP, conclude the main contract. If you still cannot conclude a preliminary lease, you can use the apartment at the registered address.
8. Can a foreign citizen be the director of the LLP?
The director of the LLP can be a foreign citizen, but only with the appropriate permission issued by the authorized body.
For reference: citizens of the EAEU member countries can be leaders or ordinary employees in an LLP without a work permit.