Due to the current unstable situation in the world financial and local currency markets due to the coronavirus (COVID-19) pandemic, the National Bank of Kazakhstan has started changing currency control regulations. This LawFlash provides a summary of the current changes.
The National Bank of Kazakhstan (NBK) management board on 19 March approved Resolution No. 25 regarding changes to NBK Management Board Resolution No. 40 of 30 March 2019 on Approval of Rules for Performing Currency Operations in Kazakhstan (Currency Operations Rules) that came into effect on 23 March—the day when Resolution No. 25 was published in the Electronic Control Hub for Kazakhstan Normative Legal Acts.
In accordance with NBK’s Information Notice of 24 March, posted at NBK’s official website, the Currency Operations Rules were changed to restrict unreasonable speculative demand for non-cash foreign currency, and to protect the rights and interests of citizens, society, and the state.
The changes are as follows:
Finally, we note that according to NBK’s press release No. 12 of 25 March, the Kazakhstan government decided to require mandatory sale of export proceeds at the domestic market by quasi-state entities—companies/exporters having more than 50% state ownership, including companies within the Samruk-Kazyna State Welfare Fund group. This requirement will be in effect during the declared state of emergency in Kazakhstan—until 15 April.
As of the distribution of this LawFlash, the referred government resolution was not published officially. It appears that such resolution was made within the authorities of the Kazakhstan government to establish, in accordance with the joint recommendations of NBK and other relevant state authorities, an ad hoc currency regime of certain restrictions in the case of a serious threat to sustainability of the payment balance, stability of the domestic currency market, or the economic security of Kazakhstan, unless such situation may be resolved through other economic policy measures.
We will continue monitoring for further Kazakhstan currency regulation changes and will update our clients and readers as new information comes to light. A Russian-language version of this LawFlash is available upon request.
For our clients, we have formed a multidisciplinary Coronavirus COVID-19 Task Force to help guide you through the broad scope of legal issues brought on by this public health challenge. We also have launched a resource page to help keep you on top of developments as they unfold. If you would like to receive a daily digest of all new updates to the page, please subscribe now to receive our COVID-19 alerts.
If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:
 Requirement to put an interest-free deposit in the amount of certain percentage of currency operation amount into Kazakhstan bank or NBK for a certain period, to receive certain permission from NBK for a currency operation or to sell foreign currency received by a Kazakhstan resident at the domestic market; or restricted use of the accounts opened with foreign banks; limited term for repatriation of currency proceeds; limited volume, number or currency of payment under currency operations; and other requirements and restrictions.