95. Exercise of supervisory powers by the AFSA

(1) The AFSA may exercise any of the powers set out in this Chapter at any time where if it considers it necessary or desirable to do so in accordance with its Regulatory Objectives.

(2) The AFSA may set out in Rules or guidance circumstances in which it is likely to exercise such powers.

(3) If the AIFC has exercised one or more of the powers set out in this Chapter it may, if it considers it necessary or desirable to do so in accordance with the Regulatory Objectives:

• (a) withdraw a prohibition, restriction, requirement, or decision to exercise any of its supervisory powers; or
• (b) substitute or vary an existing prohibition, restriction, requirement, or decision to exercise any of its supervisory powers.

(4) A requirement imposed on a Person as a result of the exercise by the AFSA of powers under this Part may be enforceable by injunction on the application of the AFSA to the AIFC Court.

(5) Any prohibition or requirement including any variation or substitution of such prohibition or requirement, does not operate so as to render an agreement unenforceable by a party to the agreement if he proves that in entering into the agreement he acted in good faith and was unaware of any notice given, served or published in relation to such imposition, withdrawal, substitution or variation.

96. Power to gather information

(1) The AFSA may, by notice in writing, require an Authorised Person, Ancillary Service Provider, Approved Individual, Designated Individual or any other Director, Employee or representative agent of an Authorised Person or Ancillary Service Provider to:

• (a) give, or procure the giving of, such specified information; or
• (b) produce, or procure the production of, such specified documents; to the AFSA as the AFSA considers necessary or desirable to meet the objectives.

(2) The AFSA may require an Authorised Person or Ancillary Service Provider to allow the AFSA to enter its premises during normal business hours or at any other time as may be agreed for the purpose of inspecting and copying information or documents stored in any form on such premises, as it considers necessary or desirable to meet the Regulatory Objectives.

(3) The AFSA may exercise its powers under this section 96 in respect of any information, documents or premises wherever they may be located in the Republic of Kazakhstan.

(4) Information given or a document produced as a result of the exercise by the AFSA of powers under this section is admissible in evidence in any proceedings, provided that any such information or document also complies with any requirements relating to the admissibility of evidence in such proceedings.

97. Power to require the production of a report

(1) The AFSA may, by notice in writing, require an Authorised Person, or Ancillary Service Provider to provide the AFSA with a report on any matter as the AFSA considers necessary or desirable to meet the Regulatory Objectives.

(2) The Person appointed to make a report required by section 97(1) must be a Person nominated or approved by the AFSA.

(3) Where a requirement has been made of an Authorised Person or Ancillary Service Provider under this section, the Authorised Person must take all reasonable steps to ensure that:

• (a) any Person who is providing or has provided services to the Authorised Person must provide all such assistance as the appointed Person may reasonably require; and
• (b) the appointed Person co-operates with the AFSA.

(4) The obligation in section 97(1) is enforceable on application by the AFSA to the AIFC Court.

(5) The costs of providing a report must be paid by the Authorised Person, or Ancillary Service Provider to whom a notice has been given under section 97(1).

(6) Subject to section 97(7), information given or a document produced as a result of the exercise by the AFSA of powers under this section is admissible in evidence in any proceedings, provided that any such information or document also complies with any requirements relating to the admissibility of evidence in such proceedings.

(7) The AFSA may not disclose a statement made by a Person in a report made pursuant to a requirement made of the Person under section 97(1) to any law enforcement agency for the purpose of criminal proceedings against the Person unless:

• (a) the Person consents to the disclosure; or
• (b) the AFSA is required by law or court order to disclose the statement.

98. Power to restrict, withdraw or suspend a Licence

(1) The AFSA may:

• (a) impose or vary such conditions, restrictions and requirements on a Licence as the AFSA considers appropriate; or
• (b) withdraw an Authorised Person’s Licence or vary its Licence to remove one or more Regulated Activities or Market Activities; or
• (ba) withdraw an Ancillary Service Provider's License or vary its Licence to remove one or more Ancillary Services; or
• (c) suspend an Authorised Person’s Licence in relation to one or more Regulated Activities or Market Activities; or
• (d) suspend an Ancillary Service Provider's Licence in relation to one or more Ancillary Services.

(2) The decision making procedures in Schedule 1 apply to a decision made by the AFSA under this section.

99. Power to impose a prohibition

(1) The AFSA may prohibit an Authorised Person or Ancillary Service Provider from:

• (a) entering into certain specified transactions or types of transactions; or
• (b) soliciting business from certain specified Persons or types of Persons; or
• (c) carrying on business in a specified manner or other than in a specified manner; or
• (d) using a particular name or description in respect of the Authorised Person or Ancillary Service Provider; or
• (e) dealing with any relevant property in a specified manner or other than in a specified manner; or
• (f) assisting, counselling or procuring another Person to deal with any relevant property in a specified manner or other than in a specified manner.

(2) The decision making procedures in Schedule 1 apply to a decision made by the AFSA under this section.

99-1. Power to give directions for prudential purposes and capital requirements

(1)            For prudential purposes and capital requirements, the AFSA may direct an Authorised Person or Authorised Persons within a specified class to, among others:

(a)            comply with any specified additional capital or liquidity requirements;

(b)            apply a specific provisioning policy or treatment of specified assets;

(c)            comply with specified limits on material risk exposures;

(d)            comply with specified limits on exposures to related parties;

(e)            meet additional or more frequent reporting requirements; or

(f)             take such other action as is specified in the direction.

(2)            The AFSA may direct an Affiliate of an Authorised Person to take specified actions or not to carry on specified activities if the AFSA:

(a)            is the consolidated supervisor of the Group to which the Authorised Person belongs; and

(b)            is satisfied that the direction is necessary or desirable for the purposes of the effective prudential supervision of the Group on a consolidated basis.

(3)            A direction to an Affiliate under subsection (2) may include a requirement that the Affiliate:

(a)            limit any activities it carries on or may carry on (including closing any office which is outside the jurisdiction in which it has its principal place of business and head office) if the activities are reasonably likely to expose the Authorised Person or its Group to excessive risks or risks that are not properly managed; or

(b)            take such other measures as are necessary to remove any impediments to effective supervision of the Group on a consolidated basis, including a direction to take steps to restructure the Group.

(4)            Nothing in this section limits the scope or application of any other power that the AFSA may have in these Regulations, any Rules or Regulations or legislation administered by it.

(5)            A direction given under this section comes into force on the date specified in it and remains in force, subject to subsection (7), until it is revoked or varied in writing by the AFSA under subsection (6).

(6)            The AFSA may revoke or vary any direction given pursuant to this section.

(7)            A direction given to Authorised Persons within a specified class under subsection (1), including any variation made to such a direction under subsection (6), may not remain in force for a period longer than 12 months from the date specified in the initial direction given under subsection (1).

(8)            The decision-making procedures in Schedule 1 apply to a decision made by the AFSA under this decision.

100. Power to impose a requirement

(1) The AFSA may require an Authorised Person or Ancillary Service Provider to:

• (a) take or refrain from taking such action as the AFSA considers appropriate;
• (b) carry on business in, and only in, a specified manner;
• (c) deal with any relevant property in a specified manner;
• (d) deal with any relevant property such that:

(i) the property remains of a value and in a condition that appears to the AFSA to be desirable with a view to ensuring that the Authorised Person or Ancillary Service Provider will be able to meet its liabilities in relation to the business which constitutes a Regulated Activity or Ancillary Service for which it holds a Licence; and

(ii) the Authorised Person or Ancillary Service Provider is able at any time to transfer or dispose or otherwise deal with the property when instructed to do so by the AFSA.

(2) For the purposes of this section:

• (a) “dealing” in relation to property includes the maintaining, holding, disposing and transferring of property; and
• (b) “relevant property”, in relation to an Authorised Person, means:

(i) any property held by the Person on behalf of any of the clients of the Person, or held by any other Person on behalf of or to the order of the Person; or

(ii) any other property which the AFSA reasonably believes to be owned or controlled by the Person.

(3) The decision-making procedures in Schedule 1 apply to a ecision made by the AFSA under this section. 

101. Power to enter into enforceable agreement

(1) The AFSA may enter into a written agreement with any Person.

(2) An agreement under (1) may include an agreement to:

• (a) pay any sum to any Person (including the AFSA); or
• (b) take remedial action; or
• (c) do any other thing.

(3) The terms of such an agreement may be varied with the consent of the AFSA.

(4) If the AFSA considers that the Person who entered into the agreement has been or is in breach of any of its terms, it may apply to the AIFC Court for:

• (a) an order directing the Person to comply with the terms of the agreement; or
• (b) an order directing the Person to pay to any Person or to the AFSA an amount up to the amount of any financial benefit that the Person has obtained directly or indirectly and that is reasonably attributable to the breach; or
• (c) any order that the AIFC Court considers appropriate directing the Person to compensate any other Person who has suffered loss or damage as a result of the breach; or
• (d) any other order that the AIFC Court considers appropriate.

102. Obligation of disclosure to the AFSA

(1) Subject to (2), an Authorised Person or Ancillary Service Provider must disclose to the AFSA anything which reasonably tends to show:

• (a) a breach, or likely breach of a provision of legislation administered by the AFSA; or
• (b) a failure, or likely failure, to comply with any obligation to which an Authorised Person or Ancillary Service Provider is subject under such legislation; or
• (c) any other matter as the AFSA may prescribe in Rules; which may be attributable to the conduct of the Authorised Person or Ancillary Service Provider, or its Directors, officers, Employees or representatives.

(2) Section 102(1) does not apply to the extent that compliance with such requirement would disclose a Privileged Communication.

(3) An Authorised Person or Ancillary Service Provider must establish and implement appropriate systems and internal procedures to enable its compliance with section 102(1).

(4) Any provision in an agreement between an Authorised Person, Ancillary Service Provider and a Director, officer, Employee, representative or auditor thereof is void in so far as it purports to hinder compliance with an obligation under section 102(1).

(5) No Person may be subjected to detriment or loss or damage merely by reason of undertaking any act to cause or assist an Authorised Person or Ancillary Service Providerto comply with an obligation under subsection (1).

(6) The AIFC Court may, on application of an aggrieved Person, make any order for relief where a Person has been subjected to any such detriment or loss or damage as referred to in section 102(5).

103. Obligation to comply with an order or requirement of the AFSA

If the AFSA makes an order, gives a direction or prohibition, or makes any requirement in relation to an Authorised Person or Ancillary Service Provider pursuant to a provision of these Regulations or Rules made thereunder or other legislation administered by the AFSA, such Authorised Person or Ancillary Service Provider must, unless he has a reasonable excuse, comply with such order, direction, prohibition or requirement.

104. Provision of information to the AFSA

(1) An Authorised Person or Ancillary Service Provider must not:

• (a) provide information which is false, misleading or deceptive to the AFSA; or
• (b) conceal information where the concealment of such information is likely to mislead or deceive the AFSA.

(2) An Ancillary Service Provider must provide to the AFSA, on an annual basis, an activity report using the appropriate form specified by the AFSA.

105. Obstruction of the AFSA

An Authorised Person or Ancillary Service Provider must not engage in conduct that is intended to obstruct the AFSA in the exercise of any powers under this Part or Part 9 (Enforcement), including the:

• (a) destruction of documents;
• (b) failure to give or produce information or documents specified by the AFSA;
• (c) failure to attend before the AFSA at a specified time and place to answer questions;
• (d) giving of information that is false or misleading; and
• (e) failure to give any assistance in relation to an investigation which the Person is able to give.

106. No liability for provision of information or documents to the AFSA

An Authorised Person, or Ancillary Service Provider, an Approved Individual, a Designated Individual or any other Employee or Director of an Authorised Person or Ancillary Service Provider is neither liable to a proceeding, nor subject to a liability, nor in breach of any duty, merely by reason of:

• (a) complying, or proposing to comply, with a requirement made, or purporting to have been made, under any provision of this Part for inspection of, copying of, giving of or production of, information or documents;
• (b) the giving of information or production of a document by the Person to the AFSA in good faith and in reasonable belief that the information or document is relevant to any functions of the AFSA whether such information or document is given or produced pursuant to a requirement at law or otherwise.

107. Self-incrimination

Subject to section 108(1), it is not a reasonable excuse for a Person to refuse or fail to:

• (a) permit inspection and copying of any information or document; or
• (b) give or produce, or procure the giving or production of, any information or document; or
• (c) answer questions; pursuant to any requirement under either this Part 8 (Supervision) or 9 (Enforcement) on the grounds that any such information document or answer, as the case may be:
• (d) might tend to incriminate the Person or make the Person liable to a penalty; or
• (e) is, or contains, or might reveal a Privileged Communication; or
• (f) is, or contains, or might reveal a communication made in confidence.

108. Privilege

(1) Where the AFSA requires a lawyer to give information or to produce a document or to answer a question, and the giving of the information or the production of the document or the answer to the question would involve disclosing a Privileged Communication made by, on behalf of, or to, the lawyer in his capacity as a lawyer, the lawyer is entitled to refuse to comply with the requirement unless:

• (a) where the Person to whom, or by, or on behalf of whom, the communication was made is a body corporate that is under official management or is being wound up, the official manager or liquidator of the body as the case may be consents to the lawyer complying with the requirement; or
• (b) otherwise, the Person to whom, or by, or on behalf of whom, the communication was made consents to the lawyer complying with the requirement.

(2) Where a lawyer so refuses to comply with a requirement, he must, as soon as practicable, give to the AFSA a written notice setting out:

• (a) where the lawyer knows the name and address of the Person to whom, or by whom, or on behalf of whom, the communication was made, then that name and address; and
• (b) where the requirement to give information or produce a document relates to a communication which was made in writing, then sufficient particulars to identify the document containing the communication.

(3) “Privileged Communication” means a communication attracting a privilege arising from the provision of professional legal advice and any other privilege applicable at law, but does not include a general duty of confidentiality.

109. Requirement to appoint an Auditor

(1) An Authorised Person must appoint an Auditor.

(2) The AFSA may direct, or the AIFC Court on an application made by the AFSA may order, an Authorised Person to:

(a) apponit an Auditor, if an Auditor has not been appointed by the Authorised Person; or

(b) remove an Auditor and appoint a new Auditor, if in the opinion of the AFSA or the AIFC Court the Auditor appointed by the Authorised Person is not suitable to provide Audit Services.

(3) The decision making procedures in Schedule 1 apply to a decision made by the AFSA under this section.  

110. Auditor rules

The AFSA may make such Rules regarding:

• (a) the appointment, term of office, registration or removal of auditors;
• (b) the qualification or approval of auditors;
• (c) the duties, functions and powers of auditors;
• (d) the scope, content and timing of any reports, reviews or audits to be undertaken by auditors;
• (e) the remuneration of auditors;
• (f) the notification or reporting obligations of auditors (whether to the relevant Authorised Person, the AFSA or otherwise); and
• (g) such other related or ancillary matters the AFSA thinks fit.

111. Relevant Transfer

The AFSA may provide by Rules that the transfer of the business of carrying on specified Regulated Activities by an Authorised Firm (a “Relevant Transfer”) either:

• (a) may only be made by an order of the AIFC Court under section 113; or
• (b) may be made by such an order if the transferor elects.

112. Application to the AIFC Court

(1) An application to the AIFC Court for an order sanctioning a Relevant Transfer may be made by either the transferor or the transferee under the Relevant Transfer or both.

(2) Where an application is made to the AIFC Court for an order sanctioning a Relevant Transfer, the AFSA may give directions in respect of:

• (a) the preparation of a report in relation to the transfer;
• (b) the notification of specified Persons of the transfer; and
• (c) the publication of notices in relation to the transfer.

(3) On an application under (1), the following are entitled to be heard:

• (a) any Person who alleges that he would be adversely affected by the carrying out of the transfer; and
• (b) the AFSA.

113. Powers of the Court in relation to a transfer scheme

(1) The AIFC Court may make an order under this section approving a Relevant Transfer if:

• (a) any directions given by the ASFA pursuant to section 112(2) have been complied with;
• (b) on or before the Relevant Transfer becoming effective, the transferee:

(i) will have the authorisation required (if any) to enable it to carry on the business which is to be transferred to it in the place to which it is to be transferred; and

(ii) will possess adequate financial resources to carry on the business concerned in accordance with the legislation applicable in the place to which it is to be transferred; and

• (c) the AIFC Court considers, in all the circumstances of the case, it is appropriate to sanction the Relevant Transfer.

(2) If the AIFC Court makes an order sanctioning a Relevant Transfer, it may by that or any subsequent order make such provision (if any) as it thinks fit:

• (a) for the transfer to the transferee of the whole or any part of the undertaking concerned and of any property or liabilities of the Authorised Firm concerned; or
• (b) for the continuation by (or against) the transferee of any pending legal proceedings by (or against) the firm concerned; or
• (c) with respect to such incidental, consequential and supplementary matters as are, in its opinion, necessary to secure that the Relevant Transfer is fully and effectively carried out; or
• (d) for dealing with the interests of any Person who, within such time and in such manner as the AIFC Court may direct, objects to the Relevant Transfer; or
• (e) for the dissolution, without winding up, of any firm concerned.

(3) An order may:

• (a) transfer property or liabilities whether or not the Authorised Firm concerned otherwise has the capacity to effect the transfer in question; or
• (b) make provision in relation to property which was held by the Authorised Firm concerned as trustee; or
• (c) make provision as to future or contingent rights or liabilities of the Authorised Firm concerned, including provision as to the construction of instruments under which such rights or liabilities may arise.

(4) If an order makes provision for the transfer of property or liabilities:

• (a) the property is transferred to and vests in; and
• (b) the liabilities are transferred to and become liabilities of; the transferee as a result of the order.

(5) If any property or liability included in the order is governed by the law of any jurisdiction other than the AIFC, the order may require the Authorised Firm concerned, if the transferee so requires, to take all necessary steps for securing that the transfer to the transferee of the property or liability is fully effective under the law of that country or territory.

(6) Property transferred as the result of an order under this section may, if the AIFC Court so directs, vest in the transferee free from any charge which is (as a result of the scheme) to cease to have effect.

(7) An order under this section which provides for the transfer of property is to be treated as an instrument of transfer for the purposes of any Regulation or Rule requiring the delivery of an instrument of transfer to register property.