Luxembourg: Recent Changes To The Securities Market Law And NBK Regulation Affecting The AIFC

Last Updated: 26 November 2018
Article by Joel Benjamin, Adlet Yerkinbayev and Kuanysh Shekerbekov

November 2018We discuss below the changes to (i) the Securities Market Law, effective 21 October 2018, and (ii) the NBK Regulation, effective 8 October 2018, affecting certain matters related to the Astana International Financial Center (AIFC). Our note is intended to be a helpful guide – it is therefore not comprehensive and does not constitute legal advice.

The changes effectively created legal framework to trade Kazakhstan securities on the AIFC and use AIX as a local stock exchange in international offerings of Kazakhstan resident securities. This was previously available to the Kazakhstan Stock Exchange only.

On 5 October 2018, Kazakhstan adopted the Law No. 184-VI ЗРК "On amendments and changes to certain legislative acts of the Republic of Kazakhstan on matters of ensuring the uniformity of measurement and standardization" (the “Law”). Among other things, the Law introduces changes to the Securities Market Law, which affects the regulations related to operations of the AIFC. The provisions of the Law regulating the matters related to the AIFC became effective on 21 October 2018.

There were also changes made to the NBK Regulation regarding the prohibition on double listing, which impact the AIFC. These changes became effective on 8 October 2018.

New changes in the Law

The Law provides for the following changes:

Exemption from the Requirements of Article 22-1 if International Offering is made via AIFC

Under Article 22-1 of the Securities Market Law, Kazakhstan residents wishing to issue and/or place securities outside Kazakhstan as well as list such shares on a foreign stock exchange must obtain consents from the National Bank of Kazakhstan (NBK).

The NBK Consents can be granted if (in summary without details):

  • the securities of the Kazakhstan resident are listed on the KASE (KASE listing);
  • the Kazakhstan resident offers on the KASE at least 20% of the new securities (Local Offer Requirement),

(The KASE listing and Local Offer Requirement are hereinafter referred to as the “Article 22-1 Requirements”).

With the new Law, a Kazakhstan resident will no longer need to comply with the Article 22-1 Requirements if it complies with the AIFC Offer Requirement as described below.

If a Kazakhstan resident makes an International Offering, it will not be required to obtain the NBK Consents, undertake a listing on KASE, or comply with the Local Offer Requirement and other formalities under Article 22-1 of the Securities Market Law, if such Kazakhstan resident:

  • issues and (or) places new securities at the AIFC; and
  • offers at least 20% of such new securities at the AIFC,

(the “AIFC Offer Requirement”).

The AIFC Offer Requirement effectively means that a Kazakhstan resident will need to list its securities on the Astana International Exchange (the AIX), which is the trading platform of the AIFC.

AIX CSD acting as a nominal holder

The Securities Market Law previously provided that only the following organisations can perform nominal holding services in Kazakhstan: (i) the Central Depositary, (ii) custodians, brokers and (or) dealers (who have a relevant licence for nominal holding of securities) and (iii) the single operator in respect of the nominal holding of securities owned by the state (or in respect of which the state has property rights) (the “Nominal Holding Service”).

AIX CSD is the organisation, which carries out registration of transactions with securities and provides depositary services at AIFC.

With the new Law, AIX CSD can now render Nominal Holding Service.

AIX CSD providing Nominal Holding Service for another nominal holder

The Securities Market Law provides that in Kazakhstan, with the exception of the Central Depositary and custodians who provide nominal holding services in respect of foreign securities or foreign organizations who perform nominal holding services, a nominal holder is not entitled to provide nominal holding services to another nominal holder.

The Law will now allow the AIX CSD to provide nominal holding services to another nominal holder in respect of securities transferred to AIX CSD for nominal holding.

AIX CSD as the client of the Central Depositary

Given the above changes, the AIX CSD providing nominal holding services will now become a client of the Central Depository (in addition to other entities who are customarily the clients of the Central Depositary under the Securities Market Law).

Lifting of the prohibition on double listing

Until recently, the NBK Regulation contained a prohibition whereby the securities of an issuer listed on the KASE could not be simultaneously admitted to circulation on another stock exchange or a quotation organization operating in Kazakhstan (the “Double Listing Prohibition”).

So effectively, the Double Listing Prohibition meant that shares listed on the KASE could not be simultaneously listed on another stock exchange operating in Kazakhstan such as the AIX.

Until now, the Double Listing Prohibition has not been an issue because the KASE was the only stock exchange in the country.

However, with the opening of the AIX in 2018, the possible lifting of the Double Listing Prohibition became particularly relevant.

The NBK Regulation has now been amended to remove the Double Listing Prohibition. Kazakhstan residents can now list the same securities on the AIFC and the KASE simultaneously.


AIFC – Astana International Financial Centre.

AIX CSD – organisation which is engaged in the registration of transactions with securities and provides depositary service.

AIX – Astana International Exchange.

Central Depositary – Central Securities Depository JSC.

Securities Market Law – the Law No. 461-II of the Republic of Kazakhstan “On Securities Market” dated 2 July 2003 (as amended).

Kazakhstan Resident – for the purposes of the Securities Market Law, the Kazakhstan resident which either (i) is established in Kazakhstan, or (ii) has at least two-thirds of its assets located in Kazakhstan, or issued in accordance with Kazakhstan legislation (for example, the assets comprise Kazakhstan securities), or (iii) has effective management located in Kazakhstan.

KASE – Kazakhstan Stock Exchange.

NBK – National Bank of Kazakhstan.

NBK Consents – the prior written permission of the NBK to issue and place securities outside Kazakhstan.

NBK Regulation – the decree of the management board of the Agency of the Republic of Kazakhstan on regulation and supervision of the financial market and financial organisations on approval of the Rules “On conducting the activities of the organisation engaged in trading of securities and other financial instruments” dated 29 September 2008, no. 170 (as amended).

International Offering – offering of the securities of the Kazakhstan resident outside Kazakhstan.

Local Offer Requirement – offering on the KASE at least 20% of the total number of securities being offered in connection with the International Offering.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions