No.

Part/Chapter/

Section No.

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Proposed version

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AIFC COMPANIES REGULATIONS

1.

PART 1: GENERAL

CHAPTER 2 CERTIFICATES

Section 8

8. Certificates

(1) The Registrar may issue a certificate subject to any conditions or restrictions.

(2) The AIFC Participant must not Contravene a condition or restriction to which the certificate is subject.

(3) The Registrar may suspend the activity of the AIFC Participant or vary the terms of the activity of the AIFC Participant on the Registrar’s own initiative or on the application of the AIFC Participant.

(4) The Registrar may exercise a power under subsection (3) in relation to an activity of the AIFC Participant on the Registrar’s own initiative only if the Registrar:

(a) complies with the Decision-making Procedures; and

(b) either:

(i) is satisfied that the AIFC Participant, or an officer, employee or agent of the AIFC Participant, has Contravened, is Contravening or is likely to Contravene these Regulations; or

(ii) considers that the exercise of the power is necessary or desirable in the interests of the AIFC.

(5) [intentionally omitted]

(6) [intentionally omitted]

(7) Contravention of subsection (2) is punishable by a fine.

8. Certificates

(1) The Registrar may issue a certificate subject to any conditions or restrictions.

(2) The AIFC Participant must not Contravene a condition or restriction to which the certificate is subject.

(3) The Registrar may suspend the activity of the AIFC Participant or vary the terms of the activity of the AIFC Participant on the Registrar’s own initiative or on the application of the AIFC Participant.

(4) The Registrar may exercise a power under subsection (3) in relation to an activity of the AIFC Participant on the Registrar’s own initiative only if the Registrar:

(a) complies with the Decision-making Procedures; and

(b) either:

(i) is satisfied that the AIFC Participant, or an officer, employee or agent of the AIFC Participant, has Contravened, is Contravening or is likely to Contravene these Regulations; or

(ii) considers that the exercise of the power is necessary or desirable in the interests of the AIFC.

(5) [intentionally omitted]

(6) [intentionally omitted]

(7) Contravention of subsection (2) is punishable by a fine.

Item 8 (technical enhancement) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

2.

PART 4: COMPANY FORMATION AND INCORPORATION

Section 26

26. Annual returns

…

(1-1) A Company which is subject to subsection (1) must, within 6 months of the end of each

financial year, or other date the Registrar considers appropriate, file with the Registrar an

annual return containing:

(a) its financial statements for the last financial year for which the Company’s accounts have been prepared; and

(b) a statement, for each class of Shares in the Company, setting out either:

(i) the name and address of each Shareholder who, on the filing date, held\not less than 5% of the Allotted Shares of that class and the number of\Shares of that class held by the Shareholder, together with the number of Shareholders each of whom, on that date, held less than 5% of the

Allotted Shares of that class and the total number of Shares held by them; or

…

26. Annual returns

…

(1-1) A Company which is subject to subsection (1) must, within 6 months of the end of each

financial year, or other date the Registrar considers appropriate, file with the Registrar an

annual return containing:

(a) its financial statements for the last financial year for which the Company’s accounts have been prepared; and

(b) a statement, for each class of Shares in the Company, setting out either:

(i) the name and address of each Shareholder who, on the filing date, held\not less than 5% of the Aаllotted Shares of that class and the number of\Shares of that class held by the Shareholder, together with the number of Shareholders each of whom, on that date, held less than 5% of the

Aallotted Shares of that class and the total number of Shares held by them; or

…

Item 8 (technical enhancement) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

3.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 2 ALTERATION OF COMPANY TYPE

Section 40

40. Re-registration of Private Company as Public Company

…

(3) If Shares are Allotted by the Company in the period between the balance sheet date and the passing of the Special Resolution that the Company be re-registered as a Public Company, and the Shares are Paid-up otherwise than in cash, the Company must (unless the Allotment is in connection with a Share exchange) comply with the requirements of section 46 (Non-cash consideration for Shares in Public Company) in respect of the Allotment.

(4) For this section, Shares are Allotted by a Company in connection with a Share exchange

if:

(a) the consideration for the Allotment is the transfer of Shares in another Body Corporate or the cancellation of Shares in another Body Corporate, and the Allotment is open to all holders (or all of a particular class of holders) of Shares in the other Body Corporate; or

…

40. Re-registration of Private Company as Public Company

…

(3) If Shares are Aallotted by the Company in the period between the balance sheet date and the passing of the Special Resolution that the Company be re-registered as a Public Company, and the Shares are Paid-up otherwise than in cash, the Company must (unless the Allotment is in connection with a Share exchange) comply with the requirements of section 46 (Non-cash consideration for Shares in Public Company) in respect of the Allotment.

(4) For this section, Shares are Aallotted by a Company in connection with a Share exchange

if:

(a) the consideration for the Allotment is the transfer of Shares in another Body Corporate or the cancellation of Shares in another Body Corporate, and the Allotment is open to all holders (or all of a particular class of holders) of Shares in the other Body Corporate; or

…

Item 8 (technical enhancement) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

4.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 3–SHAREHOLDERS AND SHARES GENERALLY

Section 43

43. Minimum share capital

(1) Each Share in a Company must have a fixed nominal value. A Share may not be Allotted by a Company at less than its nominal value. An Allotment of a Share that does not have a fixed nominal value, or is Allotted at less than its nominal value, is void.

…

(2) A Private Company must have no minimum share capital.

(3) A Public Company:

(a) must have an issued and allotted share capital (excluding treasury Shares) of no less than U.S. $100,000 at any time; and

(b) must not Allot a Share except as Paid-up at least as to 1/4 of its nominal value.

(4) Subsection (3)(b) does not apply to Shares Allotted under an Employee Share Scheme.

43. Minimum share capital

(1) Each Share in a Company must have a fixed nominal value. A Share may not be Aallotted by a Company at less than its nominal value. An Allotment of a Share that does not have a fixed nominal value, or is Aallotted at less than its nominal value, is void.

…

(2) A Private Company must have no minimum share capital.

(3) A Public Company:

(a) must have an issued and allotted share capital (excluding treasury Shares) of no less than U.S. $100,000 at any time; and

(b) must not Aallot a Share except as Paid-up at least as to 1/4 of its nominal value.

(4) Subsection (3)(b) does not apply to Shares Aallotted under an Employee Share Scheme.

Items 1 (issue and allotment) and 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

5.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 3–SHAREHOLDERS AND SHARES GENERALLY

Section 44

44. Alteration of share capital

(1) A Company may, by Resolution, alter its share capital, unless the alteration is prohibited by its Articles of Association or results in the Company not having the share capital required by section 43 (Minimum share capital).

(2) A Company may:

(a) increase its share capital by creating new Shares of an existing class with the same nominal value, or a new class of Shares of the nominal value it considers appropriate; or

(b) consolidate and divide its share capital (whether Allotted or not) into Shares representing a larger nominal value than their existing nominal value; or

(c) subdivide its Shares, or any of them, into Shares representing a smaller nominal value than their existing nominal value, if the proportion between the amount paid and the amount unpaid (if any) on each subdivided Share is the same as it was for the Share from which the sub-divided Share was derived.

(3) A Company must not alter its share capital:

(a) otherwise than by Resolution; or

(b) if the alteration, or any alteration of its share capital, is prohibited by its Articles of Association; or

(c) if the alteration would result in the Company not having the share capital required by section 43.

(4) Contravention of subsection (3) is punishable by a fine.

(5) Subject to section 48 (Shareholders’ pre-emption rights), the board of Directors of a Company may, if authorised by the Articles of Association or Ordinary Resolution, exercise a power of the Company:

(a) to Allot Shares; or

(b) to grant rights to subscribe for or convert any Securities into Shares.

44. Alteration of share capital

(1) A Company may, by Resolution, alter its share capital, unless the alteration is prohibited by its Articles of Association or results in the Company not having the share capital required by section 43 (Minimum share capital).

(2) A Company may:

(a) increase its share capital by creating new Shares of an existing class with the same nominal value, or a new class of Shares of the nominal value it considers appropriate; or

(b) consolidate and divide its share capital (whether Aallotted or not) into Shares representing a larger nominal value than their existing nominal value; or

(c) subdivide its Shares, or any of them, into Shares representing a smaller nominal value than their existing nominal value, if the proportion between the amount paid and the amount unpaid (if any) on each subdivided Share is the same as it was for the Share from which the sub-divided Share was derived.

(3) A Company must not alter its share capital:

(a) otherwise than by Resolution or decision of the board of Directors subject to subsection (5) below; or

(b) if the alteration, or any alteration of its share capital, is prohibited by its Articles of Association; or

(c) if the alteration would result in the Company not having the share capital required by section 43 (Minimum share capital).

(4) Contravention of subsection (3) is punishable by a fine.

(5) Subject to section 48 (Shareholders’ pre-emption rights), the board of Directors of a Company may, if authorised by the Articles of Association or Ordinary Resolution, exercise a power of the Company:

(a) to Aallot and issue Shares; or

(b) to grant rights to subscribe for or convert any Securities into Shares.

Items 2 (extension of the powers of the board of Directors) and 8 (technical enhancement) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

6.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 3–SHAREHOLDERS AND SHARES GENERALLY

Section 45

45. Non-cash consideration for Shares in Private Company

(1) A Private Company must not, except as provided under subsection (2), Allot Shares as

Paid-up (in part or in full) other than for cash consideration.

(2) If a Private Company Allots Shares for consideration other than cash, the board of

Directors of the Company must:

…

45. Non-cash consideration for Shares in Private Company

(1) A Private Company must not, except as provided under subsection (2), Aallot Shares as

Paid-up (in part or in full) other than for cash consideration.

(2) If a Private Company Aallots Shares for consideration other than cash, the board of

Directors of the Company must:

…

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

7.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 3–SHAREHOLDERS AND SHARES GENERALLY

Section 46

46. Non-cash consideration for Shares in Public Company

(1) A Public Company must not Allot Shares as Paid-up (in part or in full) cash unless:

(a) the Company has obtained an independent valuation of the consideration in accordance with this section not earlier than 6 months before it Allocates the Shares; and

(b) a copy of the valuation report has been given to the proposed allottee; and

(c) copies of the valuation report and the relevant resolutions of the board of Directors have been given to the Registrar along with the notice of the Allotment.

…

46. Non-cash consideration for Shares in Public Company

(1) A Public Company must not Aallot Shares as Paid-up (in part or in full) cash unless:

(a) the Company has obtained an independent valuation of the consideration in accordance with this section not earlier than 6 months before it Allocatesallots the Shares; and

(b) a copy of the valuation report has been given to the proposed allottee; and

(c) copies of the valuation report and the relevant resolutions of the board of Directors have been given to the Registrar along with the notice of the Allotment.

…

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

8.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 3–

SHAREHOLDERS AND SHARES GENERALLY

Section 48

48. Shareholders’ pre-emption rights

…

(4) A Company’s Articles of Association may prohibit the Company from Allotting Shares of

a particular class in respect of an offer referred to in subsection (1)(a), unless the Company has complied with the equivalent pre-emption rights included in its Articles of Association. Subsection (1) does not apply in such circumstances and the Company may Allot the Shares in accordance with those equivalent pre-emption rights, if an offer is made in accordance with subsection (5).

…

48. Shareholders’ pre-emption rights

…

(4) A Company’s Articles of Association may prohibit the Company from Aallotting Shares of

a particular class in respect of an offer referred to in subsection (1)(a), unless the Company has complied with the equivalent pre-emption rights included in its Articles of Association. Subsection (1) does not apply in such circumstances and the Company may Aallot the Shares in accordance with those equivalent pre-emption rights, if an offer is made in accordance with subsection (5).

…

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

9.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 5–

REGISTERS OF SHAREHOLDERS AND DEBT SECURITY HOLDERS AND SHARE CERTIFICATES

Section 58

58. Share certificates

(1) If a Company Allocates any of its Shares or receives a properly completed transfer for any of its Shares, the Company must, within 14 days after the day it Allocates the Shares or receives the transfer, complete and have ready for delivery a certificate for all the Shares Allocated or transferred, unless title to the Shares is evidenced without a written instrument in accordance the Rules.

(2) If title to the Shares or the transfer of the Shares is evidenced without a written instrument,

the Company must complete the registration of the Allotment or transfer of the Shares within 14 days after the day the Company Allocates the Shares or receives a properly completed transfer for the Shares.

…

58. Share certificates

(1) If a Company Allocates allots any of its Shares or receives a properly completed transfer for any of its Shares, the Company must, within 14 days after the day it Allocates allots the Shares or receives the transfer, complete and have ready for delivery a certificate for all the Shares Allocatedallotted or transferred, unless title to the Shares is evidenced without a written instrument in accordance the Rules.

(2) If title to the Shares or the transfer of the Shares is evidenced without a written instrument,

the Company must complete the registration of the Allotment or transfer of the Shares within 14 days after the day the Company Allocates allots the Shares or receives a properly completed transfer for the Shares.

…

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

10.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 6–REDEMPTION AND PURCHASE OF SHARES

Section 60

60. Power to issue redeemable Shares

(1) Subject to section 61 (Power of Company to purchase its own Shares), a Company may, if authorised to do so by its Articles of Association, issue and Allot, or convert existing non-redeemable shares (whether Allotted or not) into, Shares that are to be redeemed, or are liable to be redeemed, either in accordance with their terms or at the option of the Company or the Shareholder.

…

60. Power to issue redeemable Shares

(1) Subject to section 61 (Power of Company to purchase its own Shares), a Company may, if authorised to do so by its Articles of Association, issue and Allot, or convert existing non-redeemable shares (whether Allotted or not) into, Shares that are to be redeemed, or are liable to be redeemed, either in accordance with their terms or at the option of the Company or the Shareholder.

…

Items 1 (issue and allotment) and 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

11.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 6–REDEMPTION AND PURCHASE OF SHARES

Section 62

62. Treasury Shares

…

(7) Any Shares Allotted by a Company as fully paid bonus Shares in respect of Shares held as treasury Shares must be treated as if they were purchased by the Company at the time they were Allotted.

…

62. Treasury Shares

…

(7) Any Shares Aallotted by a Company as fully paid bonus Shares in respect of Shares held as treasury Shares must be treated as if they were purchased by the Company at the time they were Aallotted.

…

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

12.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 10–MEETINGS

Section 98

98. General provisions about meetings and votes

The following provisions apply to any General Meeting of a Company or of the holders of any

class of Shares in a Company unless the Articles of Association provide otherwise:

…

(c) at any meeting dealing with a variation of any class rights other than an adjourned meeting, the quorum is the number of Shareholders holding or representing by proxy at least 1/3 in nominal value of the issued and Allotted Shares of the class, and at an adjourned meeting,1 Shareholder holding Shares of the class or the

Shareholder’s proxy is a quorum;

…

98. General provisions about meetings and votes

The following provisions apply to any General Meeting of a Company or of the holders of any

class of Shares in a Company unless the Articles of Association provide otherwise:

…

(c) at any meeting dealing with a variation of any class rights other than an adjourned meeting, the quorum is the number of Shareholders holding or representing by proxy at least 1/3 in nominal value of the issued and Allotted Shares of the class, and at an adjourned meeting, 1 Shareholder holding Shares of the class or the

Shareholder’s proxy is a quorum;

…

Item 1 (issue and allotment) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

13.

PART 7: PRIVATE COMPANIES AND PUBLIC COMPANIES

CHAPTER 11–PROTECTION OF MINORITIES IN TAKEOVERS

Section 105

105. Takeover Offers

…

(2) In subsection (1):

Shares means Shares that:

(a) have been Allotted on the date of the offer; or

(b) are subsequently Allotted before a date specified in or determined in accordance with the terms of the offer; or

…

105. Takeover Offers

…

(2) In subsection (1):

Shares means Shares that:

(a) have been Aallotted on the date of the offer; or

(b) are subsequently Aallotted before a date specified in or determined in accordance with the terms of the offer; or

…

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

14.

PART 10: ACCOUNTS, REPORTS AND AUDIT

CHAPTER 2–ACCOUNTS AND REPORTS

Section 131

131. Accounts

(1) The Directors of every Company must ensure that accounts are prepared in relation to each financial year of the Company and that the accounts comply with the requirements in this section.

(2) The accounts must:

(a) be prepared in accordance with accounting principles or standards prescribed by the Rules or otherwise approved by the Registrar; and

(b) show a true and fair view of the profit or loss of the Company for the period and of the state of the Company’s affairs at the end of the period; and

(c) comply with any other requirements of these Regulations and the Rules.

(3) The Directors of a Company must approve the Company’s accounts and must ensure that they are signed on their behalf by at least 1 Director.

(4) The Directors of a Company must ensure that, within 6 months after the end of each financial year of the Company, the accounts for that year are:

(a) prepared and approved by the Directors; and

(b) examined and reported upon by an Auditor; and

(c) if the Company is a Public Company—laid before a General Meeting, together with a copy of the Auditor’s report and Directors’ report, for discussion and, if considered appropriate, approval by the Shareholders; and

(d) for all Companies—sent, together with (if applicable) a copy of the Auditor’s report or Directors’ report (or both), to every Shareholder, other than a Shareholder for whom the Company does not have a current postal address.

(5) A Company must file with the Registrar, within 14 days after the day subsection (4)(d) is complied with in relation to a financial year, a copy of the accounts and the Auditor’s report for the financial year and, if the Company is a Public Company, a copy of the Directors’ report prepared under section 133 (Directors’ reports for Public Companies) for the financial year.

(6) Unless otherwise provided in its Articles of Association, a Private Company and its Directors are not required to comply with subsections (4)(b) and (5) if the Company, during the current year for which the accounts are being prepared and, if the Company has existed for more than 1 financial year, the year immediately before that financial year, has:

(a) an annual turnover of not more than U.S. $5,000,000; and

(b) an average of not more than 20 Shareholders.

(7) However, the Shareholders representing not less than 10% of the nominal value of the share capital of a Private Company to which subsection (6) applies may, by Written notice given to the Company no earlier than the start of any financial year and no later than 1 month before the end of the financial year, require the Company to obtain an audit of its accounts for financial year. The Directors of the Company must ensure that the request is complied with.

(8) If a provision of this section requires the Directors of a Company to do something, each

of the Directors are severally liable if the thing is not done as required by this section.

(9) Contravention of this section is punishable by a fine.

131. Accounts

(1) The Directors of every Company must ensure that accounts are prepared in relation to each financial year of the Company and that the accounts comply with the requirements in this section.

(2) The accounts must:

(a) be prepared in accordance with accounting principles or standards prescribed by the Rules or otherwise approved by the Registrar; and

(b) show a true and fair view of the profit or loss of the Company for the period and of the state of the Company’s affairs at the end of the period; and

(c) comply with any other requirements of these Regulations and the Rules.

(3) The Directors of a Company must approve the Company’s accounts and must ensure that they are signed on their behalf by at least 1 Director.

(4) The Directors of a Company must ensure that, within 6 months after the end of each financial year of the Company, the accounts for that year are:

(a) prepared and approved by the Directors; and

(b) examined and reported upon by an Auditor; and

(c) if the Company is a Public Company—laid before a General Meeting, together with a copy of the Auditor’s report and Directors’ report, for discussion and, if considered appropriate, approval by the Shareholders; and

(d) for all Companies—sent, together with (if applicable) a copy of the Auditor’s report or Directors’ report (or both), to every Shareholder, other than a Shareholder for whom the Company does not have a current postal address.

(5) A Company must file with the Registrar, within 14 days after the day subsection (4)(d) is complied with in relation to a financial year, a copy of the accounts and the Auditor’s report for the financial year and, if the Company is a Public Company, a copy of the Directors’ report prepared under section 133 (Directors’ reports for Public Companies) for the financial year.

(6) Unless otherwise provided in its Articles of Association, a Private Company and its Directors are not required to comply with subsections (4)(b) and (5) if the Company, during the current year for which the accounts are being prepared and, if the Company has existed for more than 1 financial year, the year immediately before that financial year, has: (a) an annual turnover of not more than U.S. $5,000,000.; and

(b) an average of not more than 20 Shareholders.

(7) However, the Shareholders representing not less than 10% of the nominal value of the share capital of a Private Company to which subsection (6) applies may, by Written notice given to the Company no earlier than the start of any financial year and no later than 1 month before the end of the financial year, require the Company to obtain an audit of its accounts for financial year. The Directors of the Company must ensure that the request is complied with.

(8) If a provision of this section requires the Directors of a Company to do something, each

of the Directors are severally liable if the thing is not done as required by this section.

(9) Contravention of this section is punishable by a fine.

Item 4 (audit requirements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

15.

PART 10: ACCOUNTS, REPORTS AND AUDIT

CHAPTER 3–AUDITORS

Section 136.

136. Appointment and removal of Auditors

(1) If a Company is required by these Regulations to have its accounts examined and AIFC reported on by an Auditor, the Company must appoint an Auditor to examine and report on, in accordance with these Regulations and the Rules, the accounts prepared under section 131 (Accounts).

(2) A Person, who is not an Auditor, must not:

(a) consent to be appointed as an Auditor of a Company; or

(b) act as an Auditor of a Company; or

(c) prepare any report required by these Regulations and the Rules to be prepared by an Auditor.

(3) Contravention of subsection (2) is punishable by a fine.

(4) The appointment of a firm as an Auditor of a Company is taken to be an appointment of each Person who is a partner of the firm.

(5) A Public Company must, at each Annual General Meeting at which the accounts for the previous financial year are laid, appoint an Auditor to hold office from the conclusion of that meeting to the conclusion of the next Annual General Meeting at which the accounts are laid.

(6) A Private Company must, within 6 months after the end of a financial year or, if earlier, before the day the accounts are sent to the Shareholders, appoint an Auditor to hold office from that date until the end of the next period for appointing Auditors.

(7) The appointment of an Auditor by a Private Company must be by a resolution of its Directors unless the Shareholders, at a General Meeting, have appointed an Auditor by an Ordinary Resolution.

(8) The Directors of a Public Company may, at any time before the first General Meeting at which the accounts for the previous financial year are laid, appoint an Auditor to hold office to the conclusion of the first General Meeting.

(9) The Directors of a Company may fill any casual vacancy in the office of Auditor on the terms they consider appropriate. An Auditor appointed to fill a casual vacancy holds office:

(a) for a Public Company—until the conclusion of the next General Meeting at which the accounts for the previous financial year are laid; or

(b) for a Private Company—until the end of the next period for appointing Auditors.

(10) Subject to subsection (9), the Company may, by Ordinary Resolution, fix the Auditor’s remuneration.

(11) A Company must not appoint an Auditor under this section unless:

(a) the Auditor has, before the appointment, consented in Writing to the Company; and

(b) the Company is not, on reasonable inquiry, aware of any matter that should prevent the Auditor from giving the Auditor’s consent under paragraph (a).

(12) An Auditor must not consent to an appointment as an Auditor of a Company if:

(a) the Auditor has, or may reasonably be perceived to have, a conflict of interest; or

(b) the Auditor does not have, or may reasonably be perceived not to have, a requisite degree of independence from the Company; or

(c) the Auditor, or any associate of the Auditor in a firm or business undertaking, has acted as an Auditor of the Company within the earlier period or frequency prescribed by the Rules.

(13) A Company may, despite anything in any agreement between it and its Auditor, remove the Auditor at any time by Resolution.

(14) The Court may, on application made by the Registrar, order the removal of the Auditor of a Company.

(15) This section does not deprive an Auditor removed under this section of compensation or damages payable to the Auditor in respect of the termination of the Auditor’s appointment.

(16) Every Company and its Officers must take reasonable efforts to provide the information and assistance required by an Auditor for the Exercise of the Auditor’s Functions under these Regulations or the Rules.

136. Appointment and removal of Auditors

(1) If a Company is required by these Regulations to have its accounts examined and AIFC reported on by an Auditor, the Company must appoint an Auditor to examine and report on, in accordance with these Regulations and the Rules, the accounts prepared under section 131 (Accounts).

(2) A Person, who is not an Auditor, must not:

(a) consent to be appointed as an Auditor of a Company; or

(b) act as an Auditor of a Company; or

(c) prepare any report required by these Regulations and the Rules to be prepared by an Auditor.

(3) Contravention of subsection (2) is punishable by a fine.

(4) The appointment of a firm as an Auditor of a Company is taken to be an appointment of each Person who is a partner of the firm.

(5) A Public Company must, at each Annual General Meeting at which the accounts for the previous financial year are laid, appoint an Auditor to hold office from the conclusion of that meeting to the conclusion of the next Annual General Meeting at which the accounts are laid.

(6) Subject to 131(6), a Private Company must, within 6 months after the end of a financial year or, if earlier, before the day the accounts are sent to the Shareholders, appoint an Auditor to hold office from that date until the end of the next period for appointing Auditors.

(7) The appointment of an Auditor by a Private Company must be by a resolution of its Directors unless the Shareholders, at a General Meeting, have appointed an Auditor by an Ordinary Resolution.

(8) The Directors of a Public Company may, at any time before the first General Meeting at which the accounts for the previous financial year are laid, appoint an Auditor to hold office to the conclusion of the first General Meeting.

(9) The Directors of a Company may fill any casual vacancy in the office of Auditor on the terms they consider appropriate. An Auditor appointed to fill a casual vacancy holds office:

(a) for a Public Company—until the conclusion of the next General Meeting at which the accounts for the previous financial year are laid; or

(b) for a Private Company—until the end of the next period for appointing Auditors.

(10) Subject to subsection (9), the Company may, by Ordinary Resolution, fix the Auditor’s remuneration.

(11) A Company must not appoint an Auditor under this section unless:

(a) the Auditor has, before the appointment, consented in Writing to the Company; and

(b) the Company is not, on reasonable inquiry, aware of any matter that should prevent the Auditor from giving the Auditor’s consent under paragraph (a).

(12) An Auditor must not consent to an appointment as an Auditor of a Company if:

(a) the Auditor has, or may reasonably be perceived to have, a conflict of interest; or

(b) the Auditor does not have, or may reasonably be perceived not to have, a requisite degree of independence from the Company; or

(c) the Auditor, or any associate of the Auditor in a firm or business undertaking, has acted as an Auditor of the Company within the earlier period or frequency prescribed by the Rules.

(13) A Company may, despite anything in any agreement between it and its Auditor, remove the Auditor at any time by Resolution.

(14) The Court may, on application made by the Registrar, order the removal of the Auditor of a Company.

(15) This section does not deprive an Auditor removed under this section of compensation or damages payable to the Auditor in respect of the termination of the Auditor’s appointment.

(16) Every Company and its Officers must take reasonable efforts to provide the information and assistance required by an Auditor for the Exercise of the Auditor’s Functions under these Regulations or the Rules.

Item 4 (audit requirements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

16.

PART 12: RECOGNISED COMPANIES

Section 147

147. Requirements of Recognised Company

(1) A Recognised Company must:

(a) appoint and retain at all times at least 1 Person who is authorised to accept service of any Document or notice on behalf of the Recognised Company and to Exercise any other Function prescribed by the Rules; and

(b) have a place of business in the AIFC to which all communications and notices may be addressed; and

(c) file with the Registrar, in the form and way required by the Rules, notice of the following:

(i) the appointment of Persons authorised to accept service for the Recognised Company;

(ii) the address of the principal place of business of the Recognised Company in the AIFC;

(iii) details of Persons authorised to accept service and the address of its principal place of business in the AIFC;

(iv) details of the Recognised Company’s shareholders or members;

(v) details of the Recognised Company’s Directors and Secretary; and

(d) give the Registrar a copy of each annual return filed in its jurisdiction of incorporation, within 30 days after the day it files the annual return in that jurisdiction; and

(e) comply with any other requirement prescribed by the Rules.

(2) The Rules or any other Legislation Administered by the Registrar may:

(a) prescribe procedures in relation to the requirements under this Part; and

(b) exclude, waive or modify any requirements under this Part in relation to different cases or classes of case.

(3) Contravention of this section is punishable by a fine.

147. Requirements of Recognised Company

(1) A Recognised Company must:

(a) appoint and retain at all times at least 1 Person who is authorised to accept service of any Document or notice on behalf of the Recognised Company and to Exercise any other Function prescribed by the Rules; and

(b) have a place of business in the AIFC to which all communications and notices may be addressed; and

(c) file with the Registrar, in the form and way required by the Rules, notice of the following:

(i) the appointment of Persons authorised to accept service for the Recognised Company;

(ii) the address of the principal place of business of the Recognised Company in the AIFC;

(iii) details of Persons authorised to accept service and the address of its principal place of business in the AIFC;

(iv) details of the Recognised Company’s shareholders or members;

(v) details of the Recognised Company’s Directors and Secretary; and

(d) give the Registrar a copy of each annual return or comparable document filed in its jurisdiction of incorporation, within 30 days after the day it files the annual return or comparable document in that jurisdiction; and

(e) comply with any other requirement prescribed by the Rules.

(2) The Rules or any other Legislation Administered by the Registrar may:

(a) prescribe procedures in relation to the requirements under this Part; and

(b) exclude, waive or modify any requirements under this Part in relation to different cases or classes of case.

(3) Contravention of this section is punishable by a fine.

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

17.

SCHEDULE 1: INTERPRETATION

4. Definitions for these Regulations

Employee, of a Company, means an individual who is appointed or employed by the Company and whose services are provided to, or for the purposes of, the Company, and includes an Officer of the Company.

4. Definitions for these Regulations

Employee, of a Company, means an individual who is appointed or employed by the Company and whose services are provided to, or for the purposes of, the Company, and includes an Officer of the Company. However, with respect to a Director, the Company itself must decide whether its Director is an Employee or not. If this is the case, a contract of employment must be in place. 

Item 6 (Director status) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

Incorporator, of a Company (or proposed Company), means a Person to whom Shares in the Company (or proposed Company) are Allotted (or are to be Allocated) on the incorporation of the Company (or proposed Company).

Incorporator, of a Company (or proposed Company), means a Person to whom Shares in the Company (or proposed Company) are Aallotted (or are to be Allocated allotted) on the incorporation of the Company (or proposed Company).

Item 8 (technical enhancements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

AIFC FOUNDATIONS REGULATIONS

18.

PART 3: ESTABLISHMENT OF AN AIFC FOUNDATION

Section 14

14. Creation

(1) The Founder(s) may apply for the establishment of a Foundation by signing and filing with the Registrar an application for its establishment in the manner prescribed by the Registrar.

(2) The application filed with the Registrar under subsection (1) shall be signed by each Founder and shall include:

(a) the name of the proposed Foundation;

(b) the address of the proposed Foundation’s registered office in the AIFC;

(c) the full name, nationality and address of each Founder;

(d) the full name, nationality and address of each of the proposed members of the Council of the proposed Foundation;

(e) the Charter of the proposed Foundation;

(f) the By-laws of the proposed Foundation;

(g) the particulars required by Part 16 (Ultimate Beneficial Owners) of the AIFC Companies Regulations; and

(h) such other particulars as the Registrar may require.

(3) The provisions of section 21 (Prohibition against use of misleading, deceptive or conflicting Company names) of the AIFC Companies Regulations shall apply to a Foundation in respect of the use of misleading, deceptive or conflicting names.

…

14. Creation

(1) The Founder(s) may apply for the establishment of a Foundation by signing and filing with the Registrar an application for its establishment in the manner prescribed by the Registrar.

(2) The application filed with the Registrar under subsection (1) shall be signed by each Founder and shall include:

(a) the name of the proposed Foundation;

(b) the address of the proposed Foundation’s registered office in the AIFC;

(c) the full name, nationality and address of each Founder;

(d) the full name, nationality and address of each of the proposed members of the Council of the proposed Foundation;

(e) the Charter of the proposed Foundation (subject to subsections 16(7) and 16(7-1) (Charter);

(f) the By-laws of the proposed Foundation (subject to subsections 17(5) and 17(5-1) (By-laws);

(g) the particulars required by Part 16 (Ultimate Beneficial Owners) of the AIFC Companies Regulations; and

(h) such other particulars as the Registrar may require.

(3) The provisions of section 21 (Prohibition against use of misleading, deceptive or conflicting Company names) of the AIFC Companies Regulations shall apply to a Foundation in respect of the use of misleading, deceptive or conflicting names.

…

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

19.

PART 3: ESTABLISHMENT OF AN AIFC FOUNDATION

Section 16

16. Charter

…

(7) The Board of Directors of the AFSA may prescribe model provisions to be known as the

“Standard Charter”, and a Foundation may, for its Charter, adopt the whole or any part thereof as are applicable to that Foundation.

…

16. Charter

…

(7) The Board of Directors of the AFSA may prescribe model provisions to be known as the

“Standard Charter”, and a Foundation may, for its Charter, adopt the whole or any part thereof as are applicable to that Foundation.

A Foundation may adopt, as its Charter, the whole or any part of the Standard Charter as is applicable to the Foundation.

(7-1) If the Standard Charter is not adopted by a Foundation in its entirety, the Foundation must submit to the Registrar of Companies, before the charter is adopted by the Foundation, a statement by the Founder(s) that the Charter proposed to be adopted by the Foundation complies with the requirements of these Regulations and all other applicable AIFC Regulations and AIFC Rules.

(7-2) If any change to these Regulations or any other applicable AIFC Regulations or AIFC Rules results in an inconsistency between the provisions of a Foundation’s Charter and the provisions of these Regulations or any other applicable AIFC Regulations or AIFC Rules:

(a) the provisions of these Regulations and any other applicable AIFC Regulations and AIFC Rules prevail; and

(b) the Foundation is not required to amend its Charter, unless these Regulations or any other applicable AIFC Regulations expressly require it to do so.

…

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

20.

PART 3: ESTABLISHMENT OF AN AIFC FOUNDATION

Section 17

17. By-laws

…

(5) The Board of Directors of the AFSA may prescribe by way of AIFC Acts model provisions

to be known as the “Standard By-laws”, and a Foundation may adopt the whole or any part thereof as are applicable to that Foundation.

…

17. By-laws

…

(5) The Board of Directors of the AFSA may prescribe by way of AIFC Acts model provisions

to be known as the “Standard By-laws”, and a Foundation may adopt the whole or any part thereof as are applicable to that Foundation.

A Foundation may adopt, as its By-laws, the whole or any part of the Standard By-laws as are applicable to the Foundation.

(5-1) If the Standard By-laws are not adopted by a Foundation in its entirety, the Foundation must submit to the Registrar of Companies, before the By-laws are adopted by the Foundation, a statement by the Founder(s) that the By-laws proposed to be adopted by the Foundation comply with the requirements of these Regulations and all other applicable AIFC Regulations and AIFC Rules.

(5-2) If any change to these Regulations or any other applicable AIFC Regulations or AIFC Rules results in an inconsistency between the provisions of a Foundation’s By-laws and the provisions of these Regulations or any other applicable AIFC Regulations or AIFC Rules:

(a) the provisions of these Regulations and any other applicable AIFC Regulations and AIFC Rules prevail; and

(b) the Foundation is not required to amend its By-laws, unless these Regulations or any other applicable AIFC Regulations expressly require it to do so.

…

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

21.

PART 10-1: ANTI-MONEY LAUNDERING AND COUNTER TERRORIST FINANCING OBLIGATIONS

Sections 59-1, 59-2 and 59-3

None

PART 10-1: ANTI-MONEY LAUNDERING AND COUNTER TERRORIST FINANCING OBLIGATIONS

59-1. Obligations in respect of payments and transactions

A Foundation must carry out its payments and transactions of the third parties through a banking and financial intermediary (a regulated financial institution) based in the AIFC jurisdiction, Republic of Kazakhstan, or in a jurisdiction that is a FATF member or an equivalent jurisdiction.

59-2. Notification obligations

(1) A Foundation must immediately notify the AFSA when it becomes aware of:

(a) complex or unusually large transactions, or an unusual pattern of transactions;

(b) transactions which have no apparent economic or legal purpose; and

(c) other activity which the Foundation regards as particularly likely by its nature to be related to money laundering or terrorist financing.

(2) A Foundation must inform the AFSA in writing as soon as possible if, in relation to its activities carried on as part of the AIFC or in relation to any of its branches or subsidiaries, it:

(a) receives a request for information from a regulator or agency responsible for anti-money laundering and counter-terrorism financing, or sanctions compliance in connection with potential money laundering, terrorist financing, or sanctions breaches;

(b) becomes aware, or has reasonable grounds to believe, that a money laundering event has occurred or may have occurred in or through its business;

(c) becomes aware of any money laundering or sanctions matter in relation to the Foundation or its branch or subsidiary which could result in adverse reputational consequences to the Foundation; or

(d) becomes aware of a significant breach of the AIFC AML regulation framework or a breach of the relevant Kazakhstan legislation by the Foundation or any of its employees.

59-3. Reporting and record keeping

(1) A Foundation must file information about transactions, identified risks of money laundering and terrorist financing and any suspicious activities on request of the AFSA and Financial Intelligence Unit of the Republic of Kazakhstan (FIU).

(2) The information must be filed in the form and manner prescribed by the AFSA and FIU and must contain the information required by the AFSA and FIU.

(3) A Foundation must maintain the following records:

(a) the supporting documents (consisting of the original documents or certified copies) in respect of the customer business relationship, including transactions;

(b) suspicious activities and any relevant supporting documents and information, including internal findings and analysis of money laundering and terrorist financing risks; any relevant communications with the FIU;

(c) for at least six years from the date on which the notification or report was made, the business relationship ends or the transaction is completed, whichever occurs last.

Item 5 (AML/CFT obligations and supervision) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

22.

SCHEDULE 1 INTERPRETATION

SCHEDULE 1 INTERPRETATION

None

SCHEDULE 1 INTERPRETATION

…

Standard By-laws means standard by-laws prescribed by these Regulations.

Standard Charter means a standard charter prescribed by these Regulations.

…

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

23.

None

SCHEDULE 4 STANDARD FOUNDATION CHARTER

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

24.

None

SCHEDULE 5 STANDARD FOUNDATION BY-LAWS

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

AIFC GENERAL PARTNERSHIP REGULATIONS

25.

PART 2: FORMATION AND REGISTRATION

Section 10

10. General partnership agreement

Each partner of a general partnership formed in the AIFC must enter into a partnership agreement signed by all the partners.

10. General partnership agreement

(1) Each partner of a general partnership formed in the AIFC must enter into a partnership agreement signed by all the partners.

(2) A general partnership may adopt, as its partnership agreement, the whole or any part of the Standard Partnership Agreement that is relevant to the general partnership.

(3) If the Standard Partnership Agreement is not adopted by a general partnership in its entirety, the general partnership must submit to the Registrar of Companies, before the partnership agreement is adopted by the general partnership, a statement by the initial partners that the partnership agreement proposed to be adopted by the general partnership complies with the requirements of these Regulations, the Rules and all other applicable AIFC Regulations and AIFC Rules.

(4) If any change to these Regulations, the Rules or any other applicable AIFC Regulations or AIFC Rules results in an inconsistency between the provisions of a general partnership’s agreement and the provisions of these Regulations, the Rules or any other applicable AIFC Regulations or AIFC Rules:

(a) the provisions of these Regulations and any other applicable AIFC Regulations and AIFC Rules prevail; and

(b) the general partnership is not required to amend its partnership agreement, unless these

Regulations, the Rules or any other applicable AIFC Regulations expressly require it to do so.

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

26.

SCHEDULE 1: INTERPRETATION

1. Definitions for these Regulations

…

None

…

SCHEDULE 1: INTERPRETATION

1. Definitions for these Regulations

…

Standard Partnership Agreement means a standard partnership agreement prescribed by the Rules.

…

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

AIFC LIMITED PARTNERSHIP REGULATIONS

PART 2: FORMATION AND REGISTRATION

Section 10

10. Partnership agreement of limited partnership formed in AIFC

…

(3) The partnership agreement must be a Written agreement between the partners about the affairs of the partnership and the conduct of its business, purpose or activity.

(4) The partnership agreement must be binding on the initial partners and their assigns, and on subsequent partners and their assigns, in the same way as if they had all executed the agreement.

(5) The partnership agreement may be amended only by a Written instrument and all amendments must be binding in the way mentioned in subsection (3).

10. Partnership agreement of limited partnership formed in AIFC

…

(3) The partnership agreement must be a Written agreement between the partners about the affairs of the partnership and the conduct of its business, purpose or activity.

(4) The partnership agreement must be binding on the initial partners and their assigns, and on subsequent partners and their assigns, in the same way as if they had all executed the agreement.

(5) The partnership agreement may be amended only by a Written instrument and all amendments must be binding in the way mentioned in subsection (34).

(6) A limited partnership may adopt, as its partnership agreement, the whole or any part of the Standard Partnership Agreement that is relevant to the limited partnership.

(7) If the Standard Partnership Agreement is not adopted by a limited partnership in its entirety, the limited partnership must submit to the Registrar of Companies, before the partnership agreement is adopted by the limited partnership, a statement by the initial partners that the partnership agreement proposed to be adopted by the limited partnership complies with the requirements of these Regulations, the Rules and all other applicable AIFC Regulations and AIFC Rules.

(8) If any change to these Regulations, the Rules or any other applicable AIFC Regulations or AIFC Rules results in an inconsistency between the provisions of a limited partnership’s agreement and the provisions of these Regulations, the Rules or any other applicable AIFC Regulations or AIFC Rules:

(a) the provisions of these Regulations and any other applicable AIFC Regulations and AIFC Rules prevail; and

(b) the limited partnership is not required to amend its partnership agreement, unless these

Regulations, the Rules or any other applicable AIFC Regulations expressly require it to do so.

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

27.

PART 2: FORMATION AND REGISTRATION

Section 12

12. Limited Partnerships: registration

…

(5) A copy of the entire partnership agreement must be filed with the application.

…

(8) If the Registrar of Companies decides to register the limited partnership, the Registrar

must:

…

(f) register the partnership agreement that accompanied the application for incorporation.

12. Limited Partnerships: registration

…

(5) A copy of the entire partnership agreement must be filed with the application along with the statement mentioned in section 10(7) (Partnership agreement of limited partnership formed in AIFC) unless the Standard Partnership Agreement is adopted by a limited partnership in its entirety.

…

(8) If the Registrar of Companies decides to register the limited partnership, the Registrar

must:

...

(f) register the partnership agreement that accompanied the application for incorporation unless the Standard Partnership Agreement is adopted by a limited partnership in its entirety.

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

28.

SCHEDULE 1: INTERPRETATION

1. Definitions for these Regulations

…

None

SCHEDULE 1: INTERPRETATION

1. Definitions for these Regulations

…

Standard Limited Partnership Agreement means a standard partnership agreement prescribed by the Rules.

…

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

AIFC LIMITED LIABILITY PARTNERSHIP REGULATIONS

29.

PART 2: FORMATION AND REGISTRATION

10. Method of formation

…

(4) A copy of the partnership agreement must be filed with the application.

…

(7) If the Registrar of Companies incorporates a Limited Liability Partnership, the Registrar

must register the partnership agreement that accompanied the application for incorporation.

10. Method of formation

…

(4) A copy of the partnership agreement must be filed with the application along with the statement mentioned in section 11(5) (Limited Liability Partnership agreement) unless the Standard Partnership Agreement is adopted by a Limited Liability Partnership in its entirety.

…

(7) If the Registrar of Companies incorporates a Limited Liability Partnership, the Registrar must register the partnership agreement that accompanied the application for incorporation unless the Standard Partnership Agreement is adopted by a Limited Liability Partnership in its entirety.

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

30.

PART 2: FORMATION AND REGISTRATION

11. Limited Liability Partnership agreement

…

(3) If the partnership agreement of a Limited Liability Partnership is amended, the partnership

must file with the Registrar of Companies a copy of the amendments and a copy of the agreement as it has been amended.

11. Limited Liability Partnership agreement

…

(3) If the partnership agreement of a Limited Liability Partnership is amended, the partnership

must file with the Registrar of Companies a copy of the amendments and a copy of the agreement as it has been amended.

(4) A limited liability partnership may adopt, as its partnership agreement, the whole or any part of the Standard Partnership Agreement that is relevant to the Limited Liability Partnership.

(5) If the Standard Partnership Agreement is not adopted by a Limited Liability Partnership in its entirety, the Limited Liability Partnership must submit to the Registrar of Companies, before the partnership agreement is adopted by the Limited Liability Partnership, a statement by the initial partners that the partnership agreement proposed to be adopted by the Limited Liability Partnership complies with the requirements of these Regulations, the Rules and all other applicable AIFC Regulations and AIFC Rules.

(6) If any change to these Regulations, the Rules or any other applicable AIFC Regulations or AIFC Rules results in an inconsistency between the provisions of a Limited Liability Partnership’s agreement and the provisions of these Regulations, the Rules or any other applicable AIFC Regulations or AIFC Rules:

(a) the provisions of these Regulations and any other applicable AIFC Regulations and AIFC Rules prevail; and

(b) the Limited Liability Partnership is not required to amend its partnership agreement, unless these Regulations, the Rules or any other applicable AIFC Regulations expressly require it to do so.

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

31.

PART 7: ACCOUNTS AND AUDIT

CHAPTER 2–ACCOUNTING RECORDS AND ACCOUNTS

Section 30

30. Accounts of Limited Liability Partnerships

(1) The members of a Limited Liability Partnership must ensure that accounts are prepared for the partnership in relation to each financial year of the partnership and that the

requirements of this section are complied with in relation to the accounts.

(2) The accounts must:

(a) be prepared in accordance with accounting principles or standards prescribed by the Rules or otherwise approved by the Registrar of Companies; and

(b) show a true and fair view of the profit or loss of the Limited Liability Partnership for the financial year and of the state of the partnership’s affairs at the end of the financial year; and

(c) comply with any other requirements of these Regulations and the Rules.

(3) Within 6 months after the end of the financial year, the accounts for the financial year must

be:

(a) prepared and approved by all the members; and

(b) signed on their behalf by at least 1 of the members; and

(c) examined and reported on by an Auditor.

(4) The Limited Liability Partnership must file a copy of its accounts for the financial year, and

the Auditor’s report on the accounts, with the Registrar of Companies within 7 days after the day the accounts have been reported on by the Auditor.

(5) Contravention of this section is punishable by a fine.

30. Accounts of Limited Liability Partnerships

(1) The members of a Limited Liability Partnership must ensure that accounts are prepared for the partnership in relation to each financial year of the partnership and that the

requirements of this section are complied with in relation to the accounts.

(2) The accounts must:

(a) be prepared in accordance with accounting principles or standards prescribed by the Rules or otherwise approved by the Registrar of Companies; and

(b) show a true and fair view of the profit or loss of the Limited Liability Partnership for the financial year and of the state of the partnership’s affairs at the end of the financial year; and

(c) comply with any other requirements of these Regulations and the Rules.

(3) Within 6 months after the end of the financial year, the accounts for the financial year must

be:

(a) prepared and approved by all the members; and

(b) signed on their behalf by at least 1 of the members; and

(c) examined and reported on by an Auditor subject to section 31 below.

(4) The Limited Liability Partnership must file a copy of its accounts for the financial year, and

the Auditor’s report on the accounts, if applicable, with the Registrar of Companies within 7 days after the day the accounts have been reported on by the Auditor.

(5) Contravention of this section is punishable by a fine.

Item 4 (audit requirements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

32.

PART 7: ACCOUNTS AND AUDIT

CHAPTER 2–ACCOUNTING RECORDS AND ACCOUNTS

Section 31

31. Appointment of Auditors

(1) A Limited Liability Partnership must appoint an Auditor to examine and report on, in accordance with these Regulations and the Rules, the accounts prepared under section 30 (Accounts of Limited Liability Partnership).

(2) A Person who is not an Auditor must not:

(a) consent to be appointed as an Auditor of a Limited Liability Partnership; or

(b) act as an Auditor of a Limited Liability Partnership; or

(c) prepare any report required by these Regulations and the Rules to be prepared by an Auditor.

(3) Contravention of subsection (2) is punishable by a fine.

(4) The appointment of a firm as an Auditor of a Company is taken to be an appointment of each Person who is a partner of the firm.

31. Appointment of Auditors

(1) A Limited Liability Partnership must appoint an Auditor to examine and report on, in accordance with these Regulations and the Rules, the accounts prepared under section 30 (Accounts of Limited Liability Partnership), except for the Limited Liability Partnership with the annual turnover of not more than U.S. $5,000,000.

(2) A Person who is not an Auditor must not:

(a) consent to be appointed as an Auditor of a Limited Liability Partnership; or

(b) act as an Auditor of a Limited Liability Partnership; or

(c) prepare any report required by these Regulations and the Rules to be prepared by an Auditor.

(3) Contravention of subsection (2) is punishable by a fine.

(4) The appointment of a firm as an Auditor of a Company is taken to be an appointment of each Person who is a partner of the firm.

Item 4 (audit requirements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

33.

SCHEDULE 1: INTERPRETATION

1. Definitions for these Regulations

…

None

SCHEDULE 1: INTERPRETATION

1. Definitions for these Regulations

…

Standard Partnership Agreement means a standard partnership agreement prescribed by the Rules.

…

Item 3 (standard constitutional documents) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

AIFC NON-PROFIT INCORPORATED ORGANISATIONS REGULATIONS

34.

PART 4: FINANCIAL RESOURCES, ACCOUNTS AND AUDIT

Section 22

22. Accounts

(1) The Founding Members of an Incorporated Organisation must ensure that accounts are prepared in relation to each financial year of the Incorporated Organisation within 6 months after the end of the financial year and that the accounts comply with the requirements of this section.

(2) The accounts must:

(e) be prepared in accordance with accounting principles or standards prescribed by the Rules or otherwise approved by the Registrar of Companies; and

(f) show a true and fair view of the financial position of the Incorporated Organisation; and

(g) comply with any other requirements of these Regulations and the Rules.

(3) The Founding Members must approve the Incorporated Organisation’s accounts and must ensure that they are signed on their behalf by at least 1 of them.

(4) The accounts must be examined and reported on by an Auditor.

(5) An Incorporated Organisation must file its audited accounts for a financial year with the Registrar of Companies within 7 days after the day the accounts are approved by the Founding Members and reported on by an Auditor.

(6) Contravention of this section is punishable by a fine.

22. Accounts

(1) The Founding Members of an Incorporated Organisation must ensure that accounts are prepared in relation to each financial year of the Incorporated Organisation within 6 months after the end of the financial year and that the accounts comply with the requirements of this section.

(2) The accounts must:

(e) be prepared in accordance with accounting principles or standards prescribed by the Rules or otherwise approved by the Registrar of Companies; and

(f) show a true and fair view of the financial position of the Incorporated Organisation; and

(g) comply with any other requirements of these Regulations and the Rules.

(3) The Founding Members must approve the Incorporated Organisation’s accounts and must ensure that they are signed on their behalf by at least 1 of them.

(4) The accounts must be examined and reported on by an Auditor only if the gross annual income of an Incorporated Organisation is more than 500,000 USD.

(5) An Incorporated Organisation must file its audited accounts for a financial year with the Registrar of Companies within 7 days after the day the accounts are approved by the Founding Members and reported on by an Auditor.

(6) Contravention of this section is punishable by a fine.

Item 4 (audit requirements) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

35.

PART 8-3: ANTI-MONEY LAUNDERING AND COUNTER TERRORIST FINANCING OBLIGATIONS

Sections 34-3, 34-4 and 35-5

None

PART 8-3: ANTI-MONEY LAUNDERING AND COUNTER TERRORIST FINANCING OBLIGATIONS

34-3. Obligations in respect of payments and transactions

An Incorporated Organisation must carry out its payments and transactions of the third parties through a banking and financial intermediary (a regulated financial institution) based in the AIFC jurisdiction, Republic of Kazakhstan, or in a jurisdiction that is a FATF member or an equivalent jurisdiction.

34-4. Notification obligations

(1) An Incorporated Organisation must immediately notify the AFSA when it becomes aware of:

(a) complex or unusually large transactions, or an unusual pattern of transactions;

(b) transactions which have no apparent economic or legal purpose; and

(c) other activity which an Incorporated Organisation regards as particularly likely by its nature to be related to money laundering or terrorist financing.

(2) An Incorporated Organisation must inform the AFSA in writing as soon as possible if, in relation to its activities carried on as part of the AIFC or in relation to any of its branches or subsidiaries, it:

(a) receives a request for information from a regulator or agency responsible for anti-money laundering and counter-terrorism financing, or sanctions compliance in connection with potential money laundering, terrorist financing, or sanctions breaches;

(b) becomes aware, or has reasonable grounds to believe, that a money laundering event has occurred or may have occurred in or through its business;

(c) becomes aware of any money laundering or sanctions matter in relation to the Incorporated Organisation or its branch or subsidiary which could result in adverse reputational consequences to the Incorporated Organisation; or

(d) becomes aware of a significant breach of the AIFC AML regulation framework or a breach of the relevant Kazakhstan legislation by the Incorporated Organisation or any of its employees.

34-5. Reporting and record keeping

(1) An Incorporated Organisation must file information about transactions, identified risks of money laundering and terrorist financing and any suspicious activities on request of the AFSA and Financial Intelligence Unit of the Republic of Kazakhstan (FIU).

(2) The information must be filed in the form and manner prescribed by the AFSA and FIU and must contain the information required by the AFSA and FIU.

(3) An Incorporated Organisation must maintain the following records:

(a) the supporting documents (consisting of the original documents or certified copies) in respect of the customer business relationship, including transactions;

(b) suspicious activities and any relevant supporting documents and information, including internal findings and analysis of money laundering and terrorist financing risks; any relevant communications with the FIU;

(c) for at least six years from the date on which the notification or report was made, the business relationship ends or the transaction is completed, whichever occurs last.

Item 5 (AML/CFT obligations and supervision) of the amendments set out in “Key Elements of the proposed amendments” of the Consultation Paper

No.

Part/Chapter/

Section No.

Current version

Proposed version

Comments

AIFC COMPANIES RULES

36.

PART 4: PRIVATE COMPANIES AND PUBLIC COMPANIES

Rule 4.3.

4.3. Allotment of Shares

If a Company Allots Shares in the Company, the Company must, within 14 days after the day

that it allots the Shares, notify the Registrar of Companies in Writing of the Allotment of the

Shares.

4.3. Allotment of Shares

If a Company Aallots Shares in the Company, the Company must, within 14 days after the day

that it allots the Shares, notify the Registrar of Companies in Writing of the Allotment of the

Shares.

Item 52(8) of the Policy Paper (technical amendments)

There is no definition of the “Allott”.

37.

PART 6: INVESTMENT COMPANIES

6.7. Investment Companies: Shares and Register of Shareholders

…

None

6.7. Investment Companies: Shares and Register of Shareholders

…

6.7.8. An Investment Company shall maintain its register of Shareholders in accordance with the requirements:

(a) in the AIFC Collective Investment Scheme Rules rule 7.10; and

(b) in Chapter 5 of Part 7 of the AIFC Companies Regulations, to the extent that such requirements are not inconsistent with the requirements referred to in (a).

Item 52 (8) of the Policy Paper (technical amendments)

The amendments are proposed to harmonise the AIFC Companies Regulations and AIFC Companies Rules and provide clarity in obligations of Investment Companies in keeping the registers of Shareholders.

Eg., Regulation 1.9.2 of the DIFC Investment Companies (IC) Regulations

AIFC GENERAL PARTNERSHIP RULES

38.

None

SCHEDULE 3: STANDARD PARTNERSHIP AGREEMENT FOR GENERAL PARTNERSHIPS

Item 52(3) of the Policy Paper (development of a standard constitutional document)

AIFC LIMITED PARTNERSHIP RULES

39.

None

SCHEDULE 3: STANDARD PARTNERSHIP AGREEMENT FOR LIMITED PARTNERSHIPS

Item 52(3) of the Policy Paper (development of a standard constitutional document)

AIFC LIMITED LIABILITY PARTNERSHIP RULES

40.

None

SCHEDULE 3: STANDARD PARTNERSHIP AGREEMENT FOR LIMITED LIABILITY PARTNERSHIPS

Item 52(3) of the Policy Paper (development of a standard constitutional document)

AIFC FEES RULES

41.

Proposal 1 - to distinguish online and paper-based registration forms and introduce different fees, i.e. 300 USD for online registration and 500 USD for paper-based registration. As a result, the following amendments are required to be introduced.

SCHEDULE 5: FEES PAYABLE TO THE REGISTRAR OF COMPANIES

SCHEDULE 5: FEES PAYABLE TO THE REGISTRAR OF COMPANIES

An applicant seeking registration or recognition must pay the following fees to the Registrar of

Companies:

SCHEDULE 5: FEES PAYABLE TO THE REGISTRAR OF COMPANIES

An applicant seeking registration or recognition must pay the following fees to the Registrar of Companies:

Item 52(7) of the Policy Paper (fees for online registration)

New fees are planned to be introduced starting from

January 1, 2022.

Effecting the registration or recognition

Effecting the registration or recognition

online**

paper

Company Limited by Shares

300*

Company Limited by Shares

300*

500

Recognised Company

300*

Recognised Company

300*

500

Partnerships

300*

Partnerships

300*

500

Recognised Partnership

300*

Recognised Partnership

300*

500

Non-Profit Incorporated Organisations

300*

Non-Profit Incorporated Organisations

300*

500

Special Purpose Companies

300*

Special Purpose Companies

300*

500

Restricted Scope Companies

300*

Restricted Scope Companies

300*

500

Protected Cell Companies

300*

Protected Cell Companies

300*

500

Representative offices

300*

Representative offices

300*

500

NOTE:

Applicants registered or recognised after July 5, 2018, but before July 5, 2019 are subject to one single payment of 100 USD within the 12 months period from the date of registration or recognition. 

* For applicants incorporated after July 5, 2019, but before July 5, 2020 a one-time registration or recognition fee is set out at 300 USD with a possibility of paying 200 USD on the date of submission of application and deferred payment of 100 USD during the next 12 months from the date of registration or recognition

NOTE:

Applicants registered or recognised after July 5, 2018, but before July 5, 2019 are subject to one single payment of 100 USD within the 12 months period from the date of registration or recognition. 

* For applicants incorporated after July 5, 2019, but before July 5, 2020 a one-time registration or recognition fee is set out at 300 USD with a possibility of paying 200 USD on the date of submission of application and deferred payment of 100 USD during the next 12 months from the date of registration or recognition.

**Online means submission through the AIFC approved digital systems (excluding email).

42.

Proposal 2 - to exclude paper-based registration and keep only online registration.

If proposal 2 is approved, no amendments to the AIFC Fees Rules will be required.