In general, foreign citizens and foreign legal entities (as well as Kazakhstan legal entities with foreign participation) have the same rights and bear the same obligations as Kazakhstan citizens and Kazakhstan legal entities. That being said, Kazakhstan law sets out certain limitations and prohibitions concerning strategic sectors of the economy (such as agricultural land plots) or related to public interest (mass media and others).

In certain cases, the legislator establishes quantitative limitations (e.g., maximum percentage of shares) or a need to obtain certain regulatory consent.

Below is an outline of some of the most important restrictions and prohibitions applicable to non-residents in Kazakhstan.

SECTOR-SPECIFIC RESTRICTIONS AND PROHIBITIONS

• Mass-media: Foreigners, foreign legal entities, and stateless persons are prohibited to hold, [1] use, dispose of, and/or manage directly and/or indirectly over 20% of shares (interests, units) of a legal entity being the owner of mass media in Kazakhstan or operating in the media area. Such prohibition does not extend to ecommerce internet resources.
• Mass-media: A foreigner (stateless person) must not act as a chief editor (editor) of a mass media.
• Communications: The creation and operation of communication networks in Kazakhstan with control centers located outside Kazakhstan is prohibited.
• Communications: Foreigners, stateless persons, and foreign legal entities are prohibited to hold, use, dispose of, and/or manage directly and/or indirectly in aggregate 49% of voting shares, including interests and units of a legal entity operating in the telecommunications industry as an operator of national and international long-distance communication and owning ground (cable, including fiberoptic and radio relay) lines of communication without previously obtaining a positive decision of the government of Kazakhstan on the basis of opinion of the competent communications authority agreed with the national security authorities.
• Television and radio broadcasting: Activity of owners of foreign television and radio channels in the territory of Kazakhstan whose charter capital fully or partially contains the state shares (interests, units), as well as their affiliates shall be done by way of incorporation in the territory of Kazakhstan of a legal entity with the participation of foreign legal entities in the charter capital not exceeding 20% shares (interests, units). A foreigner and a stateless person cannot be the head of such legal entity and/or a person (editor) performing the preparation and release of a television or a radio channel.
• Subsoil use: The competent authority denies issuing a permit if the transfer of the subsoil use right (share in the subsoil use right) and/or objects related to the subsoil use right will entail a violation of national security requirements, including concentration of the subsoil use rights. “Concentration of the subsoil use rights” means possession by one person or a group of persons from one state of the aggregate share in the subsoil use rights and/or objects related to subsoil use rights capable of creating or that creates a threat to the national security of Kazakhstan.
• Agricultural lands: Foreigners, stateless persons, foreign legal entities, Kazakhstan legal entities with foreign participation, international organizations, scientific centers with foreign participation, as well as kandasses cannot have the right of private ownership or land use for agricultural land plots. When a foreigner, stateless person, foreign legal entity, or Kazakhstan legal entity with foreign participation becomes a participant (shareholder, member) of a Kazakhstan legal entity, the right of private ownership, including the right of temporary use of agricultural lands must be alienated. The provision of agricultural land plots into private ownership and on the right of land use to Kazakhstan citizens married to foreigners or stateless persons is prohibited.
• Frontier land: Land plots within the frontier zone of the National Frontier of Kazakhstan cannot be held on the right of ownership by foreigners, stateless persons, or citizens of Kazakhstan married to foreigners or stateless persons, including by foreign legal entities and Kazakhstan legal entities with foreign participation. When a foreigner, stateless person, foreign legal entity, or Kazakhstan legal entity with foreign participation becomes a participant (shareholder, member) of a Kazakhstan legal entity, the right of private ownership to land plots within the frontier zone or area of the National Frontier of Kazakhstan is subject to reregistration or alienation.
• Trunk pipeline: Individuals and legal entities registered in accordance with the laws of a foreign state are prohibited from owning a trunk pipeline.
• Aviation: A foreign legal entity, foreign unincorporated organization, foreigner and/or stateless person is prohibited independently or together with other foreign legal entities or foreign unincorporated organizations, foreigners, and/or stateless persons to (1) own, use and/or dispose of (directly and/or indirectly) shares of an air company established in the form of a joint-stock company, and/or derivative securities issued in accordance with the laws of Kazakhstan or any other foreign state, the underlying asset of which is shares of the air company established in the form of a joint-stock company exceeding 49% of the total number of outstanding (less shares bought out by the air company) shares of said air company; (2) exercise an effective control over the air company established in the form of a joint-stock company.
• Security business: Operation of foreign security providers in Kazakhstan is prohibited. Foreign legal entities, legal entities with foreign participation, foreigners, and stateless persons cannot act as founders (participants) and managers of specialized training centers and their branches. Foreign legal entities, legal entities with foreign participation, foreigners and stateless persons are prohibited from carrying out security activities; establishing or being founders (participants) of private security providers; or holding a private security provider in trust management.
• Entrepreneurial activities: Individuals, except for Kazakhstan citizens and kandasses, are prohibited from carrying out entrepreneurial activities.
• Forest ownership: There are certain restrictions applicable to forest ownership, participation in tender for obtaining the right of long-term forest use within the areas of the state forest fund, participation in tender for obtaining the right of long-term use of forest resources for procurement of timber, and state support, [2] or private forestation.
• Political rights: Various restrictions and prohibitions—for example, foreigners are prohibited from carrying out activities promoting the nomination and election of candidates and political parties.
• Specific sectors of economy: The only option for certain sectors or economy is doing business via Kazakhstan companies; however, foreign participation in such companies is permitted—for example, audit business; foreigners, stateless persons, and foreign legal entities are prohibited to manage or operate trunk communication lines without having a legal entity established in Kazakhstan, etc.

SPECIAL RESTRICTIONS AND PROHIBITIONS FOR RESIDENTS OF OFFSHORE ZONES/STATES WITH PREFERENTIAL TAX TREATMENT

(Refer to the relevant lists of states with preferential tax treatment for tax and financial purposes below)

• Banks: Legal entities registered in offshore zones, the list of which is established by the competent authority, are not permitted to own and/or use and/or dispose of (directly and/or indirectly) voting shares of Kazakhstan resident banks. Similar restrictions apply to other participants of the financial market (for example, insurers).
• Bank loans: It is prohibited to grant bank loans to persons registered in offshore zones, the list of which is established by the competent authority.
• Subsoil and subsoil use: The exemption from a permit of the competent authority does not apply to certain intragroup transactions where the purchaser is a resident of the state with preferential tax treatment.
• Transfer pricing: Various restrictions applicable to the adjustment of taxable objects and use of differential.
• Tax code: Various restrictions, including those related to deduction of interest, controlled foreign corporations as well as application of an increased tax rate.
• Money legalization/laundering: Operations with cash and/or any other property being subject to financial monitoring include, among other things, crediting or transfer of money to the client’s bank account carried out by an individual, legal entity, or foreign unincorporated entity registered, residing or located in an offshore zone, and having a bank account registered in an offshore zone, or a client’s transactions with cash and/or any other property with such category of persons in a cash or cashless form.

LIST OF STATES WITH PREFERENTIAL TAX TREATMENT

1. Principality of Andorra
2. Antigua and Barbuda
3. Commonwealth of the Bahamas
4. Barbados
5. Kingdom of Bahrain
6. Belize
7. Sultanate of Brunei Darussalam
8. Republic of Vanuatu
9. Cooperative Republic of Guyana
10. Republic of Guatemala
11. Grenada
12. Republic of Djibouti
13. Dominican Republic
14. Commonwealth of Dominica
15. Kingdom of Spain (only in part of the territory of the Canary Islands)
16. People's Republic of China (only in part of the territories of the special administrative regions of Aomen (Macau) and Xianggang (Hong Kong)
17. Republic of Colombia
18. Federal Islamic Republic of the Comoros
19. Republic of Costa Rica
20. Malaysia (only in part of the territory of the Labuan enclave)
21. Republic of Liberia
22. Lebanese Republic
23. Excluded
24. Republic of Mauritius
25. Islamic Republic of Mauritania
26. Portuguese Republic (only in part of the territory of the Madeira Islands)
27. Republic of Maldives
28. Republic of the Marshall Islands
29. Principality of Monaco
30. Malta
31. Mariana Islands
32. Kingdom of Morocco (only in part of the territory of the city of Tangier)
33. Republic of the Union of Myanmar
34. Republic of Nauru
35. Kingdom of the Netherlands (only in part of the territory of the island of Aruba and the dependent territories of the Antilles)
36. Federal Republic of Nigeria
37. New Zealand (only in part of the territory of the Cook Islands and Niue)
38. Republic of Palau
39. Republic of Panama
40. Independent State of Samoa
41. Republic of San Marino
42. Republic of the Seychelles
43. Saint Vincent and the Grenadines
44. Federation of Saint Kitts and Nevis
45. Saint Lucia
46. United Kingdom of Great Britain and Northern Ireland (only in part of the following territories):
    1. Anguilla Islands
    2. Bermuda
    3. British Virgin Islands
    4. Gibraltar
    5. Cayman Islands
    6. Montserrat Island
    7. Turks and Caicos Islands
    8. Isle of Man
    9. Channel Islands (the islands of Guernsey, Jersey, Sark, Alderney)
    10. South Georgia Island
    11. South Sandwich Islands
    12. Chagos Island
47. United States of America (only in part of the following territories):
    1. US Virgin Islands
    2. Guam Island
    3. Commonwealth of Puerto Rico
    4. the state of Wyoming
    5. Excluded
48. Republic of Suriname
49. United Republic of Tanzania
50. Kingdom of Tonga
51. Republic of Trinidad and Tobago
52. Sovereign Democratic Republic of Fiji
53. Republic of the Philippines
54. French Republic (only in part of the following territories):
    1. Kerguelen Islands
    2. French Polynesia
    3. French Guiana
55. Montenegro
56. Democratic Republic of Sri Lanka
57. Jamaica

The following is a list of offshore zones for the purpose of banking and insurance activities, activities of professional participants of the securities market and other licensable activities on the securities market, and activity of joint stock investment funds and micro-financial organizations:

1. United States of America (only in part of the territories of the US Virgin Islands, the state of Wyoming, the island of Guam, the state of Delaware and the Commonwealth of Puerto Rico)
2. Principality of Andorra
3. the State of Antigua and Barbuda
4. Commonwealth of the Bahamas
5. the State of Barbados
6. State of Belize
7. State of Brunei Darussalam
8. United Republic of Tanzania
9. Republic of Vanuatu
10. Republic of Guatemala
11. State of Grenada
12. Republic of Djibouti
13. Commonwealth of Dominica
14. Dominican Republic
15. New Zealand (only in part of the territory of the Cook Islands and Niue)
16. Spain (only in part of the territory of the Canary Islands)
17. Federal Islamic Republic of the Comoros
18. Cooperative Republic of Guyana
19. Republic of Costa Rica
20. People's Republic of China (only in part of the territories of the Aomen (Macao) Special Administrative Region)
21. Republic of Liberia
22. Lebanese Republic
23. Principality of Liechtenstein
24. Islamic Republic of Mauritania
25. Malaysia (only in part of the territory of the Labuan enclave)
26. Republic of Maldives
27. Republic of Malta
28. Mariana Islands
29. Republic of the Marshall Islands
30. Kingdom of Morocco (only in part of the territory of the city of Tangier)
31. Myanmar Union
32. Republic of Nauru
33. Federal Republic of Nigeria
34. The Netherlands (only in part of the territory of the island of Aruba and the dependent territories of the Antilles)
35. Republic of Palau
36. Republic of Panama
37. Portugal (only in part of the territory of the Madeira Islands)
38. Independent State of Samoa
39. Republic of Seychelles
40. The State of Saint Vincent and the Grenadines
41. Federation of Saint Kitts and Nevis
42. State of Saint Lucia
43. Republic of Suriname
44. Kingdom of Tonga
45. Republic of Trinidad and Tobago
46. United Kingdom of Great Britain and Northern Ireland (only in part of the following territories):
    1. Anguilla Islands
    2. Bermuda
    3. British Virgin Islands
    4. Gibraltar
    5. Cayman Islands
    6. Montserrat Island
    7. Channel Islands (Sark Islands, Alderney)
    8. South Georgia Island
    9. South Sandwich Islands
    10. Turks and Caicos Islands
    11. Chagos Island
47. Sovereign Democratic Republic of Fiji
48. Republic of the Philippines
49. French Republic (only in part of the following territories):
    1. The Kerguelen Islands
    2. French Guiana
    3. French Polynesia
50. Republic of Montenegro
51. Democratic Republic of Sri Lanka
52. Jamaica

[1] Accreditation of representative offices of foreign mass media and their journalists is possible.

[2] Some other restrictions on obtaining governmental subsidies for foreigners apply.

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