Best Restructuring & Insolvency Lawyers in Kazakhstan

About Restructuring & Insolvency Law in Kazakhstan, Kazakhstan

Restructuring and insolvency law in Kazakhstan deals with the legal processes and procedures relating to financially distressed companies and individuals. This area of law sets out how debts are restructured, how insolvency (bankruptcy) proceedings work, and the legal rights of creditors, debtors, and other stakeholders. The main goals are to help companies or individuals recover from financial difficulties or, if recovery is not possible, to ensure an orderly and fair distribution of assets among creditors. Kazakhstan's system is influenced by both local legislative acts and international standards, aiming to encourage good faith business conduct while also protecting creditor rights.

Why You May Need a Lawyer

There are several situations where individuals or businesses in Kazakhstan may need legal assistance in the field of restructuring and insolvency:

• Your business is facing financial hardship and considering debt restructuring or entering bankruptcy proceedings
• Certain creditors are making claims against your assets, or you are receiving legal notices regarding unpaid debts
• You are a creditor who wants to ensure your interests are protected in a debtor's insolvency proceedings
• You want to understand your options to avoid bankruptcy, such as settlement agreements or court-approved restructuring plans
• A corporate restructuring or merger may involve debt adjustments that require legal guidance
• You need to defend against claims of fraudulent bankruptcy, deliberate non-payment, or director liability
• International companies with business interests in Kazakhstan may require local expertise on cross-border insolvency

Local Laws Overview

Key legal aspects for restructuring and insolvency in Kazakhstan include:

• The main legal framework is set out in the Law of the Republic of Kazakhstan On Rehabilitation and Bankruptcy, as well as sections of the Civil Code and related regulations
• There are two primary legal procedures - rehabilitation (restructuring) and bankruptcy. Rehabilitation is designed to restore solvency and may involve debt rescheduling or other court-approved measures
• Bankruptcy can be initiated by the debtor, creditors, or the authorized state body. Once a bankruptcy procedure is launched, a bankruptcy manager is appointed, and certain transactions may be suspended or declared invalid
• Directors and company founders can be held liable for intentional or fraudulent bankruptcy, and non-compliance with bankruptcy laws can result in financial or criminal liability
• Creditor claims are satisfied in a strict order of priority set by law, with secured creditors usually having precedence over unsecured creditors
• There are specific provisions for insolvency involving individuals, legal entities, and state-owned enterprises
• Cross-border insolvency is governed by both local law and any applicable international treaties to which Kazakhstan is a party

Frequently Asked Questions

What is the difference between restructuring and bankruptcy in Kazakhstan?

Restructuring (rehabilitation) is a court-supervised process aimed at restoring a debtor’s solvency, usually through rescheduling debts or reorganizing the business. Bankruptcy, on the other hand, involves the liquidation of assets to satisfy creditor claims when recovery is no longer viable.

Who can initiate insolvency proceedings?

In Kazakhstan, insolvency proceedings can be initiated by the debtor, one or more creditors, or certain government authorities where public interests are involved.

How long does the restructuring or bankruptcy process usually take?

The duration of restructuring or bankruptcy proceedings can vary significantly, ranging from several months to over a year, depending on the complexity of the case and the assets involved.

Can individuals file for bankruptcy in Kazakhstan?

Yes, individuals as well as legal entities are subject to insolvency laws and can file for bankruptcy if they are unable to meet their debt obligations.

Do creditors have the right to challenge actions taken by the debtor before insolvency?

Creditors can challenge transactions made before insolvency if they are deemed to be preferential or detrimental to the interests of other creditors, especially those made to related parties or under suspicious circumstances.

What happens to employee wages during bankruptcy?

Employee wage claims are generally given high priority in the distribution of the debtor’s assets during bankruptcy proceedings, after certain administrative expenses.

Is it possible to avoid bankruptcy through negotiations with creditors?

Yes, it is often possible to avoid formal bankruptcy through out-of-court settlements or by applying for court-approved restructuring plans with the agreement of a majority of creditors.

Can a foreign company participate in Kazakhstan insolvency proceedings?

Foreign creditors and companies can participate in insolvency proceedings in Kazakhstan under certain conditions and may need to follow local registration and procedural requirements.

What are the risks for company directors in bankruptcy?

Company directors can face personal liability if found responsible for deliberate or fraudulent bankruptcy, mismanagement, or violation of insolvency laws.

How can a lawyer assist me in restructuring or insolvency cases?

A qualified lawyer can represent your interests in negotiations and proceedings, prepare and review documentation, provide strategic advice, and help navigate the complexities of Kazakhstan’s legal requirements.

Additional Resources

Several organizations and authorities provide support and information related to restructuring and insolvency in Kazakhstan, including:

• The Committee for State Revenue of the Ministry of Finance of the Republic of Kazakhstan, which oversees bankruptcy procedures
• The Supreme Court of the Republic of Kazakhstan, for guidance on court practices and decisions
• Licensed bankruptcy managers and legal consultancies specializing in insolvency
• Local chambers of commerce and trade associations
• Business support centers and financial ombudsman offices that can offer practical assistance

Next Steps

If you are facing financial difficulties, involved in a debt dispute, or need advice on restructuring or insolvency in Kazakhstan, the following steps can help:

• Gather all relevant documents, including financial statements, contracts, creditor letters, and court notifications
• Seek an initial consultation with a qualified restructuring and insolvency lawyer to discuss your situation
• Determine whether your case can be resolved through negotiation, formal restructuring, or if bankruptcy proceedings are necessary
• Follow your lawyer’s advice on complying with regulatory requirements and meeting all deadlines
• Stay informed about your rights and obligations throughout the process