INTRODUCTION

      Why are we issuing this Feedback Statement?

    1.    This Feedback Statement has been issued following the public consultation conducted on the proposed amendments to the AIFC Capital Market Framework. It sets out the outcomes of the consultation process and is intended to enhance transparency and regulatory clarity, in particular by:

•      summarising the key themes and views expressed by stakeholders during
  the consultation
•       explaining how the final amendments differ from the proposals consulted on;
•      outlining the main considerations that informed the final policy decisions; and
•        clarifying the rationale for not incorporating certain comments or suggestions.

     Who should read this Feedback Statement?

     2.    This Feedback Statement is particularly relevant to stakeholders who participated in the consultation process, as well as to current and potential capital market participants and other interested stakeholders.

     Terminology

     3.    Defined terms have the initial letter of the word capitalised, or of each word in a phrase. Definitions are set out in AIFC Glossary. Unless the context otherwise requires, where capitalisation of the initial letter is not used, the expression has its natural meaning.

PART I – BACKGROUND

1.    The AFSA continuously reviews the AIFC capital markets regulatory framework to ensure that it remains effective, proportionate, and aligned with the evolving needs of the market. As part of this ongoing process, AFSA identified the need to further refine certain elements of the framework in order to address practical implementation issues and enhance regulatory efficiency. This assessment was informed by supervisory observations and feedback received through ongoing engagement with market participants.

2.    In parallel, AFSA has continued to monitor regulatory developments in other jurisdictions and evolving international practices, with a view to maintaining the competitiveness and credibility of the AIFC regulatory regime. Taken together, these factors highlighted areas where existing requirements and processes could be clarified, streamlined, or adjusted to reduce unnecessary regulatory barriers while preserving investor protection and market integrity.

3.    AFSA initiated a targeted policy review and developed a set of proposed amendments aimed at improving the efficiency of offering, and listing processes, enhancing accessibility for market participants, and addressing identified gaps and inconsistencies within the framework. These proposals were subsequently published for public consultation to ensure that the proposed changes were informed by stakeholder input prior to finalisation.

4.    In July 2025, the AFSA published Consultation Paper AFSA-P-CE-2025-0001, setting out the proposed amendments to the AIFC Capital Market Framework. The public consultation was conducted from 21 July to 15 September 2025.

5.    Following the conclusion of the public consultation, the AFSA considered the comments and suggestions received. In December 2025, the AFSA Board of Directors reviewed the consultation outcomes and approved the amendments to the AIFC Capital Market Framework.

6.    The AIFC Market Rules, AIFC Authorised Market Institution Rules and AIFC Glossary with the relevant amendments are available on the AIFC and AFSA websites.

7.    The amendments will enter into force on 1 January 2026.

PART II – OUTCOMES OF PUBLIC CONSULTATION

1.    The proposed amendments were generally well received by market participants during the public consultation. Feedback indicated that the proposed changes were viewed as timely and necessary, supporting regulatory efficiency and greater clarity. Following the consultation, 12 amendments were adopted as originally proposed in the Consultation Paper, reflecting that no substantive concerns were raised in relation to these measures.

2.    In particular, these amendments introduce targeted adjustments across Prospectus exemption criteria, disclosure and reporting obligations, procedural requirements, and market access arrangements, together with clarifications to the application of existing regulatory concepts and alignment with the broader AIFC regulatory framework.

3.    Following the public consultation, 2 proposals were reconsidered in light of the feedback received. The proposal relating to the application of corporate governance requirements was clarified to provide greater certainty as to its scope and application. The proposal to remove the prospectus exemption for offers made to fewer than 50 investors via an Authorised Investment Exchange was withdrawn, as the feedback indicated that this exemption continues to serve a practical purpose in the market.

4.    The consultation also resulted in the introduction of several new proposals, informed by feedback received from market participants, which were incorporated into the final amendments. At the same time, a number of proposals raised during the consultation were not taken forward. In some cases, the supporting rationale was not considered sufficient to justify immediate changes, while in others the issues identified would benefit from more comprehensive assessment, which AFSA will consider in the context of future reviews of the capital markets regulatory framework.

Application of the Corporate Governance Principles to Equity Securities

5.    For public consultation, AFSA proposed to apply the Corporate Governance Principles, including requirements relating to directors’ duties and fair treatment of shareholders, only to Issuers of Shares, with the objective of reducing unnecessary barriers to debt issuance and enhancing the attractiveness of the AIFC for debt offerings. In response, comments were received suggesting that the proposal be further clarified to provide greater certainty as to its scope and application.

6.    In particular, the proposal suggested that application of the Corporate Governance Principles and the requirements relating to directors’ duties and the fair treatment of shareholders to Issuers of Shares should extend to Issuers of Equity Securities. This broader category would encompass other instruments such as Global Depositary Receipts (GDRs), certificates, and similar equity-linked instruments.

7.    AFSA agreed with this proposal. Expanding the scope to Issuers of Equity Securities, rather than Issuers of Shares only, will ensure a consistent and comprehensive application of governance standards across a wider range of equity-linked instruments, promoting fair treatment of shareholders and alignment with international best practice. The term “Equity Securities” is already defined in GLO and used for the purposes of MAR, which supports consistency and coherence across the AIFC regulatory framework.

Retaining exemption from Prospectus for offers made to fewer than 50 investors

8.    Based on the market feedback, AFSA initially proposed removing the exemption under MAR 1.2.2(1)(b) for offers made to fewer than 50 Investors. The proposal was justified on the basis that this exemption had limited practical relevance to traditional exchanges, which are generally designed to facilitate broad access to capital markets rather than narrowly targeted offerings.

9.    During the public consultation, however, one of market participants noted that while the exemption may indeed be of limited relevance for traditional Authorised Investment Exchanges, it remains applicable to exchanges facilitating the trading of Security Tokens. Respondent explained that such exchanges may conduct narrowly targeted offerings involving a limited number of investors, where the exemption could have legitimate use.

10. Taking this feedback into account, AFSA recognised that situations where this exemption may be applied could arise in practice. At the same time, its retention does not create any operational challenges for traditional exchanges, which may opt not to rely on this exemption and, if necessary, reflect this in its Business Rules. Accordingly, AFSA decided to retain the exemption to preserve flexibility for other Authorised Investment Exchanges.

Requirement to appoint an agent for service of process

11. Prior to public consultation, there was a market proposal, which sought to remove the requirement for issuers and members to appoint a process agent in the AIFC. It was suggested to replace it with a requirement to provide up-to-date contact details of a nominated person, email, or postal address. The rationale was that the agent requirement creates unnecessary administrative burdens, while direct contact details would suffice for communication.

12. However, AFSA considered that removing the process agent requirement would complicate communication with non-KZ entities, especially in court cases. Service of process is a fundamental legal safeguard, and the role of the process agent ensures that documents served through AIFC Court procedures are duly acknowledged and forwarded. As a result, this proposal was not included in the initial draft amendments for public consultation.

13. During the consultation period, AFSA received a revised proposal suggesting that, rather than removing the existing process agent requirement for issuers and members entirely, it should be disapplied for issuers incorporated in Kazakhstan while being retained for foreign issuers. The proposal noted that domestic issuers can be effectively reached without an additional process agent, whose role is limited to receiving service of process in the AIFC and forwarding the relevant documents. AFSA supported this approach and reflected it in the final amendments.

Prospectus exemption for Securities admitted to trading on “other market”

14. One of the respondent has shared new proposal regarding the existing exemption from Prospectus requirement under MAR 1.2.2(1)(m), which currently applies to Securities already admitted to trading on another Authorised Investment Exchange, Recognised Non-AIFC Market Institution or other Equivalent Regulated Exchange (“the other market”) and that have been continuously traded on such other market for more than 18 months, provided the issuer has complied with ongoing obligations for trading on that other market.

15. Two key amendments were proposed. First, to remove the 18-month continuous trading requirement, which is usually applicable to securities admitted under the cross-listing regime. Second, to enhance a dual-listing regime, allowing securities to be admitted to trading simultaneously on the Authorised Investment Exchange and another Equivalent Regulated Exchange under Prospectus exemption.  

16. It was argued that requiring issuers to produce a full Prospectus because trading has not yet reached the 18-month mark increases costs for issuers and reduces the attractiveness of the AIFC as a venue for cross-listings. Furthermore, issuers preparing for a dual listing usually work primarily with the home regulator to have the prospectus approved and therefore it is administratively difficult for issuers to justify revisions that are not strictly required in the primary jurisdiction.

17. Following internal discussions and consultations with the market, AFSA has accepted these proposals, given the practical experience gained by the market to date and the objective of supporting both cross-listing and dual-listing regimes. With that where a Prospectus originates from a jurisdiction with Prospectus standards less equivalent and may give rise to investor protection concerns, the Authorised Investment Exchange still may require a full Prospectus.   

Feedback not incorporated in the final amendments

18. In addition to the proposals reflected in the final amendments, the consultation also gave rise to a number of further suggestions from market participants. AFSA carefully considered these suggestions alongside the regulatory objectives, supervisory experience, and alignment with international practice, but concluded that they should not be incorporated into the final amendments.

Extension of the Prospectus exemption to additional categories of investors

19. A proposal from market participants was received to expand the categories of investors eligible for exemption from the Prospectus requirement. It was suggested that, in addition to Professional Clients (as defined under the AIFC regulatory framework), the exemption should also cover “Qualified Clients” or “Qualified Investors” as defined under Kazakhstan’s legislation or other recognised jurisdictions.

20. AFSA did not support the proposal, as introducing “Qualified Clients” or “Qualified Investors” alongside the existing Professional Client category would undermine regulatory clarity and the objective of alignment with broader AIFC regulatory framework. Authorised Firms operating in the AIFC must adhere to the AIFC’s client classification requirements and thus we consider that exemptions should continue to refer solely to Professional Clients.

21. With that AFSA recognises that this issue may have arisen in the context of the recognition regime, where Recognised Non-AIFC Members (RNAMs) may offer AIFC-listed securities to investors in their home jurisdictions whose client classifications (e.g., “Qualified Investors”) differ from the AIFC’s definition of a Professional Client. AFSA acknowledges that this distinction may indeed warrant further clarification; however, as a comprehensive review of the recognition regime is anticipated, it would be more appropriate to consider this matter in that context.

Further broadening membership eligibility at Authorised Market Institutions

22. During the public consultation, AFSA proposed to broaden the categories of persons eligible for membership in an Authorised Market Institution by permitting an Authorised Firm, without specification of licence type, to become a member of an Authorised Market Institution, provided it meets the admission criteria set out in the Membership Rules.

23. In response to this proposal, it was suggested that membership eligibility should also be extended to individuals (natural persons) and body corporates other than Authorised Firms. It was argued that, without such flexibility, the framework could be perceived as less competitive compared to crypto-asset exchanges, for which membership for body corporates or individuals (natural persons) for own investment purposes trading is allowed.

24. AFSA acknowledges this concern and considers that this matter requires a holistic and coordinated review across all frameworks to ensure consistency before any amendments are introduced. This issue will be further assessed in the course of future framework revisions.

Further reduction of closed period for Restricted Person

25. An amendment to the definition of a “closed period” was proposed for public consultation to provide that it would end upon the announcement or publication of annual, semi-annual, or quarterly preliminary results, provided that such results contain the key information expected to be included in the final financial statements. A subsequent comment suggested further reducing the closed period to 30 days prior to such announcements; however, this was not supported, as the proposed amendment already achieves an appropriate reduction and any further shortening could create information asymmetry and undermine fair investment decision-making.

Lowering disclosure requirements for Exempt Securities

26. There was a proposal to streamline disclosure requirements for Exempt Securities by limiting disclosure obligations to audited annual financial statements and essential security information to reduce the regulatory burden and align with the initiative to simplify disclosure requirements for professional bond issuers. No further clarification was provided by respondent regarding which disclosure obligations should be removed or modified beyond what is already exempted under the current provisions.

27. In response, AFSA would like to clarify that Exempt Securities are already subject to reduced disclosure obligations under the current framework. According to MAR 3.1-1(2) Reporting Entities that are Issuers of Exempt Securities (except where such Exempt Securities have been subsequently offered to the public) are not required to prepare annual and semi-annual reports but must disclose their audited annual financial statements and interim financial statements or management account statements pursuant to MAR 3.4.1(2).