Today’s Government meeting chaired by Prime Minister Bakytzhan Sagintayev has considered the bill “On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Improving Regulation of Entrepreneurial Activity”.

Minister of National Economy T. Suleimenov reported that taking into account the current policy of deregulation and business costs reduction, removal of administrative barriers and stimulation of entrepreneurship development, the bill was developed to tackle the following objectives:

- Reform of state control and supervision activities;

- Reform of permits issued by monopolists and quasi-public sector entities;

- Development of the self-regulation institute;

- Identification and elimination of norms that hinder competition;

- Head-on reduction of business costs;

- Improvement of the mechanisms for identifying and suppressing price and tariff fixing;

- Development of business support measures;

- Improvement of Kazakhstan's position in the Doing Business rating.

In total, the bill introduces about 1000 amendments to 13 codes and 103 laws.

One of the main innovations of the bill is the introduction of preventive control. Such a reform should radically change the mentality and behavior of inspection agencies to the policy of "prevention and warning" of the offense in place of the current "detection and punishment" policy.

Based on the results of the work, it is proposed to legislatively eliminate a number of scopes of control and supervision due to duplication and lack of efficiency, eliminate duplicate and non-relating to risks to the state and the consumer, and reduce requirements for inspections of business entities.

Implementing these measures will result in the total number of inspections reducing by 30% by 2018, which will amount to no more than 70 thousand, and by 2020 - by another 10%.

One of the most significant burdens on business is a large number of information tools. According to the results of the inventory, more than 1600 information requirements for business have been identified, many of which are duplicated with control functions or with forms of state statistical reporting. With a view to reform information tools, it is planned to reduce their number by 30% and consolidate the final list.

Also, in-depth work is being carried out to further optimize and simplify the licensing system for business. In 2016, a reform was carried out on a 50% reduction in permits, resulting in the number of permits dropping from 708 to 316. To continue this work, it is proposed to make appropriate amendments and additions to the Law "On Permits and Notifications."

In order to further develop the self-regulation institution introduced in 2016, amendments are proposed for additional incentive measures. To date, voluntary self-regulation is practiced in bookmaking, environmental auditing, tax advice, fire safety. The introduction of mandatory self-regulation in valuation activities and environmental auditing activities has already been worked out and amendments are included in the bills for the current year. In addition, this issue is being studied in 6 potential areas (appraisal, notarial, legal, audit activities, environmental auditing activities and non-departmental comprehensive expertise of construction projects).

In addition, the bill contains a block of amendments aimed at head-on reduction of business costs. The most cardinal ones are connected with obtaining engineering conditions for connecting natural monopoly entities to engineering networks, reducing the rates of certain taxes and fees, and observing the requirements of environmental legislation. In addition, the reduction of costs will affect such areas as technical regulation, construction, public procurement. In general, it was noted that work aimed at reducing business costs will continue on a systematic basis.

Also, in order to create a favorable competitive environment, the bill proposes a number of amendments aimed at eliminating the norms that impede competition identified in the framework of the conducted audit of the legislation.

In addition, as part of continuing systematic work to improve the business climate in the country and the position of Kazakhstan in the World Bank’s Doing Business rating, the bill provides for a number of reforms on seven indicators of the Doing Business rating out of ten. Among them: Starting a Business, Enforcing Contracts, Dealing with Construction Permits, Protecting Minority Investors, Resolving Insolvency, Getting Credit, Registering Property.

The Prime Minister of the Republic of Kazakhstan Bakytzhan Sagintayev instructed the Ministry of National Economy together with the Prime Minister's Office to coordinate the bill with the Presidential Administration and submit it to the Majilis of the Parliament by the end of October this year.

Bakytzhan Sagintayev also noted that there are a number of activities aimed at supporting small and medium-sized businesses within the framework of the Digital Kazakhstan program. In this regard, Deputy Prime Minister Askar Zhumagaliyev and the Ministry of National Economy, and the NCE together with Baiterek Holding were instructed to launch the one-stop-shop digital platform for small and medium business by the end of November.

Published: 03 October 2017



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