4.2. Currency regulation for AIFC participants
4.2.1. Services of AIFC participants (except AIFC banks)
4.2.1.1. General description
AIFC Rules on Currency Regulation define conditions and procedure for provision of financial and related services, and provision of professional services.
Transactions related to these services can be performed via bank accounts of the AIFC participants opened in second-tier banks of Kazakhstan or AIFC Banks.
The list of financial and related services is given in Schedule 2 of the AIFC Rules on Currency Regulation.
The list of professional services is given in Schedule 3 of the AIFC Rules on Currency Regulation.
4.2.1.2. Types of services
Provision of financial and related services to other AIFC participants (residents) and non-residents
AIFC participants may provide financial services to other AIFC participants and non-residents in accordance with their AFSA licence in national or foreign currency.
The requirements are listed in section 3.3.2. of the AIFC Rules on Currency Regulation and basically require:
(i) using bank accounts in second-tier banks of Kazakhstan for financial services to be rendered both in national and foreign currency; and
(ii) using bank accounts in AIFC banks for financial services to be rendered in foreign currency only.
Provision of professional services to other AIFC participants (residents) and non-residents
AIFC participants may provide professional services to other AIFC participants and non-residents in accordance with the list approved by AFSA, in any currency.
The requirements are listed in section 3.4.1. of the AIFC Rules on Currency Regulation and follow the same approach:
(i) using bank accounts in second-tier banks of Kazakhstan for professional services to be rendered both in national and foreign currency; and
(ii) using bank accounts in AIFC banks for professional services to be rendered in foreign currency only.
Provision of financial and related services to residents that are not AIFC participants
AIFC participants provide financial and related services to residents that are not AIFC participants in accordance with the list of financial services and in the currency set out in Schedule 2 to the AIFC Rules on Currency Regulation, subject to the Acting Law of the AIFC or legislation of Kazakhstan.
The requirements are listed in section 3.3.3. of the AIFC Rules on Currency Regulation and follow the same approach:
(i) using bank accounts in second-tier banks of Kazakhstan for financial and related services to be rendered both in national and foreign currency; and
(ii) using bank accounts in AIFC banks for financial and related services to be rendered in foreign currency only.
Provision of professional services to residents that are not AIFC participants
AIFC participants may provide professional services in any currency to residents that are not AIFC participants in accordance with the list set out in Schedule 3 the AIFC Rules on Currency Regulation.
The requirements are listed in section 3.7. of the AIFC Rules on Currency Regulation and follow the same approach:
(i) using bank accounts in second-tier banks of Kazakhstan for professional services to be rendered both in national and foreign currency; and
(ii) using bank accounts in AIFC banks for professional services to be rendered in foreign currency only.
4.2.1.3. Prohibitions
The following transactions can be carried out only via bank accounts of AIFC Participants opened in second-tier banks of Kazakhstan:
(i) related to export or import of goods, works, services;
(ii) exchange transactions using the national currency;
(iii) transactions subject to assignment of registration number in accordance with the currency legislation of Kazakhstan.
4.2.2. Transactions of AIFC banks
4.2.2.1. General description
AIFC Rules on Currency Regulation define conditions and procedures for the currency transactions provided by the following AIFC banks:
(a) AIFC banks that are not Islamic Banks;
(b) AIFC banks that are Islamic Banks.
4.2.2.2. Types of transactions
Performed by AIFC banks, including Islamic Banks
AIFC banks, including Islamic banks, may:
(a) open bank accounts in other banks, including foreign banks, and transfer own funds using such bank accounts in national or foreign currency (subject to the requirements in the acting AIFC Law and legislation of Kazakhstan);
(b) open bank accounts for residents that are AIFC participants and non-residents (opening of savings (deposit) account for residents is prohibited to AIFC banks) and make payments or money transfers using such accounts (subject to the requirements set out in the AIFC Rules on Currency Regulation);
(c) open correspondent accounts in the second-tier banks of Kazakhstan in accordance with the procedure established by the legislation of Kazakhstan and carry out transactions using such correspondent accounts (subject to the requirements set out in the AIFC Rules on Currency Regulation or the legislation of Kazakhstan);
(d) open savings (deposit) accounts in foreign currency for non-residents, and AIFC participants the controlling shareholder of which is non-resident;
(e) carry out transactions envisaged by Schedule 4 to AIFC Rules on Currency Regulation through their correspondent accounts in national currency in second-tier banks of Kazakhstan.
AIFC Islamic Banks may:
(a) open bank accounts in the national currency for residents, including AIFC participants and non-residents for the purposes related to Islamic financing;
(b) open savings (deposits) accounts for residents (including AIFC participants), subject to the provisions in subparagraph (d) of paragraph 3.1.3 of the AIFC Rules on Currency Regulation.
4.2.2.3. Prohibitions
AIFC banks that are not Islamic Banks
AIFC banks are prohibited to:
(a) open bank accounts in the national currency for residents (including AIFC participants), and non-residents;
(b) open savings (deposits) accounts for residents (including AIFC participants) (except for AIFC participants the controlling shareholder of which is non-resident);
(c) carry out transactions of residents related to export or import of goods, works, services, or transactions subject to assignment of registration number in accordance with the currency legislation of the Republic of Kazakhstan;
(d) carry out exchange transactions under instructions of clients using national currency, except for the cases of executing the instructions of clients as part of transactions set out in Schedule 4 to the AIFC Rules on Currency Regulation;
(e) make payments or money transfers with respect to the services which are, under the Acting Law of the AIFC or the legislation of RK, prohibited to be provided by AIFC participants to residents that are not AIFC participants;
(f) provide services to residents that are not AIFC participants, the provision of which by AIFC banks is prohibited in accordance with the Acting Law of the AIFC or the legislation of RK; and
(g) carry out transactions through correspondent accounts in the national currency in STBs of RK that are not in the list set out in Schedule 4 to the AIFC Rules on Currency Regulation.
AIFC banks that are Islamic Banks
Islamic banks of the AIFC are prohibited to:
(a) carry out transactions of residents related to export or import of goods, works, services or transactions subject to assigning of registration number in accordance with the currency legislation of the Republic of Kazakhstan;
(b) carry out exchange transactions under instruction of clients using the national currency;
(c) make payments or transfers of clients' money for the services not related to Islamic financing;
(d) provide services to residents that are not AIFC participants, the provision of which by Islamic banks of the AIFC is prohibited in accordance with the Acting law of the AIFC or the legislation of RK.
4.2.3. Transactions of non-AIFC participants (except non-AIFC banks)
4.2.3.1. General description
Residents of Kazakhstan that are not AIFC participants are legal entities and individuals of the Republic of Kazakhstan.
4.2.3.2. Prohibitions
Residents that are not AIFC participants, are prohibited to carry out the following transactions through the AIFC Banks:
(a) related to export or import of goods, works, services;
(b) exchange transactions using the national currency;
(c) transactions subject to assignment of registration number in accordance with the currency legislation of Kazakhstan.
4.2.4. Transactions of non-AIFC banks
Transactions of non-AIFC banks are not regulated by the AIFC Rules on Currency Regulation.
4.2.5. Payments or money transfers on transactions of residents and non-residents in the AIFC
Section 4 of the AIFC Rules on Currency Regulation contains provisions regulating payments or money transactions of residents and non-residents in the AIFC.
Such payments or money transfers on foreign exchange transactions are carried out through bank accounts in AIFC banks or the second-tier banks of Kazakhstan.
Bank transfers between the AIFC bank from the accounts of the AIFC participants to their accounts in a second-tier bank of Kazakhstan and vice-versa are made in foreign currency.
Section 4.3 of the AIFC Rules on Currency Regulation sets conditions for payments or money transfers for client transactions.
The list of identifying documents and information to be provided to the AIFC bank by the client includes the following documents and information:
(a) currency contract (for transactions in the equivalent of over USD 10,000);
(b) BIN;
(c) if the client is a legal entity or an organisation that is not legal entity - documents defining the country of registration and the founders of the entity or organisation, if these documents have not been submitted or have been changed.
The AIFC bank must have sufficient identification information about the client to determine the client’s residency, link to the AIFC public register and, if applicable, client’s status as an AIFC participant as listed in section 4.3.(b) of the AIFC Rules on Currency Regulation.
The information considered as sufficient identification information about the client is listed in section 4.3.(c) of the AIFC Rules on Currency Regulation.
Section 4.3. (d) sets the conditions when the AIFC bank must refuse to make a payment or to transfer money to the client.
4.2.6. Exchange transactions in the AIFC
A purchase or sale of foreign currency can be carried out only through AIFC banks or second-tier banks of Kazakhstan under the following requirements:
(a) a request needs to indicate the purpose of the transaction;
(b) when performed with non-cash foreign currency for the national currency it is carried out solely through second-tier banks of Kazakhstan;
(c) when performed with non-cash foreign currency for other non-cash foreign currency it can be carried out through AIFC banks or second-tier banks of Kazakhstan;
(d) when performed with foreign currency in cash it is carried out through second-tier banks of Kazakhstan or through legal entities authorised by the National Bank of Kazakhstan.