Kazakhstan

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Operating a Business in Kazakhstan

Setting up a company | Working conditions | Cost of labor | Social partners

Setting up a company

Legal business entities

Types of companies and capital (max/min)	Number of partners/shareholders and liability	Registration fees
Tovarichtchestvo s ogranitchennoï otvetstvennostiou is a limited liability company. no minimum capital.	no minimum. The liability is limited to the amount of share, except in the case of a bankruptcy caused by founders where the liability can be beyond the value of share capital.	State registration of legal entity, statistical, and tax registration with the local department of Ministry of Justice: KZT 2,280. Make a company seal: KZT 2,000 - KZT 4,500. Open the current account in the bank: KTZ 0 up to KZT 10,000.
Zakrytoye aktsionernoye obchtchestvo is a close cooperation joint stock company. no minimum capital.	no minimum. The liability is limited to the amount of share, except in the case of a bankruptcy caused by founders where the liability can be beyond the value of share capital.	State registration of legal entity, statistical, and tax registration with the local department of Ministry of Justice: KZT 2,280. Make a company seal: KZT 2,000 - KZT 4,500. Open the current account in the bank: KTZ 0 up to KZT 10,000.
Tovarichtchetvo s dopolnitelnoi otvetstvennostiou is a company with additional liability	The liability is limited to the amount of share, and if they are insufficient, they will be completed by the assets of founders for an amount equivalent to the shares.	State registration of legal entity, statistical, and tax registration with the local department of Ministry of Justice: KZT 2,280. Make a company seal: KZT 2,000 - KZT 4,500. Open the current account in the bank: KTZ 0 up to KZT 10,000.
State Company
Producer's Cooperative
General partnership
Limited partnership

Business setup procedures: All forms of companies should obtain an authorisation from Ministry of Justice of Republic of Kazakhstan. Only the companies with foreign capital duly authorised by the Ministry of Justice have the right to exercise commercial activity and to undertake legal activities in Kazakhstan.
To open a sales office, documents consist of :
- a letter of intent describing the purpose of opening, activity, local partners of the office has to be presented,
- a certified copy confirming the status of the company,
- a letter from bank confirming the credit of the foreign investor,
- a power of attorney for the sales office at the time of registration.
It is necessary that the documents are in the official language Kazakh, Russian and in the language of the country where the headoffice of the company is situated.
To open a company with 100% foreign capital, documents including :
- a copy of passport or identity card of the company,
- a receipt certifying payment of registration tax,
- a document certifying location of the company and its branches and sales offices,
- 2 copies of conditions for constitution of the subsidiary,
- a legal document certifying that the founder is a legal entity and a copy of his passport or identity card are required.
The copies should be validated. All the documents described should be translated into Russian and their translation certified.
The competent organization: Ministry of Justice

Working conditions

Legal weekly duration: 40 hours
Retirement age: 61 years
Working contracts: The labour contract is governed by legal provisions and to a lesser extent by collective agreements and individual negotiation.
The formalism of labour contract is very rigid. The procedures for layoff and hiring are rather flexible.

Cost of labor

Minimum wage: 9,752 tengue (80.40 USD) in 2007. This amount does not facilitate a comfortable living in Kazakhstan.
Average wage: Average monthly gross earnings in Kazakhstan is KZT 63,570 (USD 417).
Social contributions: Social security contributions paid by employers: 31.5%.
Social security contributions paid by employees: Every employee should pay 10% of his salary to pension fund whose present withdrawals benefit them and they should also contribute for their own withdrawal.

Social partners

Social dialogue and involvement of social partners: The employees are protected against any anti union discrimination by the law. But violations to this law have taken place (union members have been dismissed and threatened). Big enterprises have also created conditions so that creation of a union and collective negotiations are rendered impossible.

The law guarantees the right to strike but its application is legally highly controlled. The government has drawn a list of strategic industries and companies in which strike is authorised according to certain conditions. Generally, the employees can only go on strike if a dispute has not been resolved through existing arbitration channels. The employees should necessarily give the employers an advance notice of 15 days for the strike.
Unions: Federation of Unions
Unionization rate: 32.8 % in 2006 (as per Federation of Unions)
Labor regulation bodies: Labour Ministry

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