Where can I view the public information about my registered or regulated status?
The AFSA maintains and publishes a Public Register of current and past grants of withdrawals and suspensions of licences and authorisations of all Registered Entities, Authorised Firms, Authorised Market Institutions (AMI), Ancillary Service Providers, Recognised Non-AIFC Members, Special Purpose Companies and FinTech Lab Participants. The public register is published on the AFSA website www.afsa.kz > Public Register > Firms.
Does the AFSA cooperate and coordinate activities with other jurisdictions?
The AFSA is a member of various international organisations and standard setting bodies. It applies best international standards and is a signatory to many Memoranda of Understanding (MoUs), IOSCO and IAIS Multilateral Memorandums of Understanding (MMoU) and bilateral agreements with such bodies and regulators around the world. These MoUs, MMoUs and bilateral agreements place international obligations of cooperation on AFSA with these bodies and regulators in other jurisdictions.
What does carrying on activities “in or from” the AIFC mean?
Carrying on activities in or from the AIFC refers to activities carried out in the AIFC between two AIFC Participants or between an AIFC Participant and another party located outside the AIFC, either in the Republic of Kazakhstan or outside of the Republic of Kazakhstan.
Does an AIFC Participant’s authorisation allow it to operate outside the AIFC?
The Authorisation authorises an AIFC Participant to carry on activities in or from the AIFC. If an AIFC Participant wishes to establish an additional office outside the AIFC, it must comply with the relevant legislation in the jurisdiction where it proposes to establish and comply with any restrictions or requirements that other jurisdictions may impose. We urge AIFC Participants to take independent legal advice as to whether they would require an additional license or authorisation from regulatory authorities of the Republic of Kazakhstan, such as the Agency for Regulation and Development of Financial Markets. Please also read the FAQ section related to AIFC Participants (please, go to www.aifc.kz > FAQ > AIFC Participation).
Is there an application fee for authorisation and how much does it cost?
The authorisation application fees vary depending on the nature and extent of the Regulated Activity, Market Activity or Ancillary Service. Please refer to Schedule 1, 2, 3 and 4 of the AIFC Fees Rules (Main > Legal Framework > Financial Services Legislation > Fees Rules) to find details on fees for applying for a Licence to carry on Regulated, Market Activities, Ancillary Services and for applications for Recognised Non-AIFC Market Institution and Recognised Non-AIFC Member status.
You can download the authorisation application form and application forms for Approved Individuals and Designated Individuals from AFSA’s website at www.afsa.kz > Firms > Authorisation > Forms. The forms include guidance notes which provide information on completing the forms and should be read in conjunction with the relevant legislation.
What is a materially complete application?
An application that fully satisfies the threshold conditions for authorisation and answers all questions asked. Note that the application process is interactive, and may involve meetings, correspondence, review of policies and procedures from the applicant or third parties and sometimes even an onsite inspection.
How long does it take to obtain an authorisation from the AFSA?
We endeavor to process all licence applications promptly, however, the actual process times depend on the complexity of the applicant’s proposed operations, the timeliness of responses and the quality of the application itself. Average application processing time for applications related to regulated activities and market activities, from the time the AFSA receives a materially complete application, is around two to three months. This does not include anytime the AFSA is awaiting information or a response from the applicant. On average materially complete applications for ancillary services take a month.
What is the timeline for authorisation?
When you apply for authorisation, you need to provide complete and detailed information about your business – such as, its structure, key individuals and financial resources.
In return, we offer you the commitments listed below. Our commitments are:
We will tell you that we have received your application within 2 working days. We will also tell you which case officer we have assigned to your application. The assigned case officer will handle all communication about your application.
We will send you our Initial Review Letter within 4 weeks. During this period, we will:
- assess your business, considering whether it meets the minimum ‘threshold conditions’;
- check your application against various databases and information held by other regulatory agencies.
You will have up to 2 months to address all our comments and observations. During this period, we may also require having an interview with some candidates for Controlled and Designated Functions.
When we receive an updated application package, we expect that all our outstanding comments are cleared. However, experience shows, that this is not always the case. Therefore, we will send you our second review comments within 2 weeks. The faster and better you address our comments, the faster we will make a decision on your application.
In rare cases it happens that the third draft application still does not satisfy our requirements. We will then have to charge a Supplementary Fee for incurring additional costs in dealing with the application. We will notify you as soon as reasonably practicable that a supplementary fee is to be required, for you to make an informed decision as to whether keep or withdraw an application. If you decide to continue the authorisation process, we will send you our third review comments within 2 weeks.
The designated case officer will give you an update on the current status of your case at least monthly and often more frequently. You will be notified within a week once your application is considered complete, at which point you will also be given an indication as to when your application is likely to be decided.
These commitments will apply until we approve your application or tell you of our decision that it should be refused, in which case you will have an opportunity to withdraw an application, otherwise we will apply a formal refusal process.
Please note that failure to provide requested information may lead to delays in assessing your application.
Thus, we endeavour to process all licence applications promptly, however, the process times depend on the complexity of the applicant’s proposed operations and the quality of the application itself. In general, average application processing time, from the time the AFSA receives a materially complete application, is around two to three months.
Why can’t staff within AFSA’s Authorisations Division provide advice on my authorisation application?
AFSA is an independent regulator and therefore cannot give advice on the same application it is
assessing for authorisation. While members of the AFSA Authorisation team might be able to assist applicants regarding the application process and AFSA’s requirements relating to the application, the AIFC’s Business Connect can provide more hands-on assistance. Applicants are therefore urged to speak to a Business Development Officer within Business Connect prior to submitting an application. Alternatively, there are a number of AFSA authorised Consultants listed on the AFSA’s Public Register that can provide a service.
For more information, please, go to www.afsa.kz > Public Register.
Who can I contact for information prior to completing an application for Authorisation?
We strongly suggest that firms, in the first instance, engage with the AIFC Business Connect Team . They will help you understand the value proposition of the AIFC to assist your evaluation of whether a presence here will make business sense for your firm. Please contact the Business Connect team by emailing [email protected]
What is the scope of Regulated Activity of Opertaing a Representative Office?
Operating a Representative Office is a regulated activity authorised by the AFSA, which essentially means marketing from an establishment in the AIFC, of one or more financial services or investments which are offered in a jurisdiction other than the AIFC.
The Financial Service of Operating a Representative Office is defined in the AIFC Representative Office Rules (REP) 2.3 (2). It means the marketing by a Person of one or more financial services or financial products which are offered in a jurisdiction other than the AIFC. REP Rules 2.3 defines “marketing” as: (a) providing information on one or more financial products or financial services; (b) engaging in promotions in relation to (a); or (c) making introductions or referrals in connection with the offer of financial services or financial products.
Under the AIFC Representative Offices (REP) Rule 2.3 (3) (a), a Representative Office must not represent anyone other than itself or a member of its Group. The term “Group” is defined in the AIFC Glossary.
For more information, please, go to www.aifc.kz > Legal Framework > Legal Framework > AIFC Financial Services Framework > Representative Office.
What is the difference between Recognised Company and Recognised Non-AIFC Member?
While Recognised Company is a branch of Foreign Company/Partnership located outside of the AIFC jurisdiction that has been registered (and authorised, if applicable) by the AFSA, and is considered to be an AIFC Participant, Recognised Non-AIFC Member is a broker or dealer from a recognised jurisdiction by AFSA with a relevant licence granted by recognised financial services regulator, who obtains permission from the AFSA to get an access to the AIX directly, without establishing legal presence and obtaining relevant authorisation, but is not considered an AIFC Participant.
Are RNAMs and RNAMIs authorised AIFC firms?
No, they are not authorised AIFC firms. RNAMs and RNAMIs are based outside the AIFC but receive a Recognition Order based on the satisfaction of certain requirements, which includes an equivalent regulatory environment. For example, Qualified market participants, such as brokers and dealers, may apply for recognition status and get access to the Astana International Exchange (AIX).
What is a Recognised Non-AIFC Member (RNAM) and Recognised Non-AIFC Market Institution (RNAMI)?
A broker or dealer, located in a jurisdiction other than the AIFC may apply to AFSA for an order declaring it be a Recognised Non-AIFC Member, while a firm which operates an investment exchange or clearing house from a place of business in a jurisdiction other than the AIFC may apply to the AFSA for an order declaring it to be a Recognised Non-AIFC Market Institution. For more information on RNAMs, please, go to www.afsa.kz > Media Centre > News > AFSA Note on Recognized Non-AIFC Members.
Can a company first register within the AIFC first and hold on to a Licence for Regulated Activities or Ancillary Services by applying for the authorisation later?
No, registration prior to Authorisation is not permitted due to several reasons: 1) As a regulator, we want to make sure that an applicant firm is fully aware of all the requirements, Rules and Regulations it has to comply with; 2) We want to make sure that as a regulator, there is no financial service or ancillary service conducted without our supervision.
Do I need to register or incorporate the company prior to authorisation?
No. This can be done post-authorisation. The registration/incorporation is a condition of every authorisation.
How do I know whether I need an authorisation or just registration?
All entities intending to carry on one or more Regulated Activity, Ancillary Service or Market Activity, in or from the AIFC, need to seek authorisation and registration/incorporation to become an AIFC Participant. Entities intending to carry on non-financial services activities, in or from the AIFC, will only need to register and incorporate.
Does my firm need to apply for Registration?
If you plan to carry on financial services activities or non-financial services activities, in or from the AIFC, you will need to register with the AFSA and incorporate your entity.
Are there any residency requirements for individuals performing a Controlled Function or Designated Function?
Generally, the Money Laundering Reporting Officer (MLRO) function must be performed by an individual ordinarily resident in the Republic of Kazakhstan. While there is no strict requirement for the Senior Executive Officer to be resident in Kazakhstan, the expectation is that the individual must spend an appropriate amount of his/her time in the Republic of Kazakhstan having due regard to the responsibilities that the Senior Executive Officer entails.
What is a Designated Function?
A Designated Function is any of the functions specified in GEN 2.3. This consists of the following functions – Senior Manager; Responsible Officer; Money Laundering Reporting Officer; Risk Manager and Internal Audit Manager.
Who is a Designated Individual?
A ‘Designated Individual' is an individual appointed by the firm to perform a ‘Designated Function’ on behalf of an Authorised firm. Designated Individuals occupy less critical roles, referred to as “Designated Functions”. They do not require AFSA approval, but may only be appointed by a firm after it has applied a fit and proper test. AFSA must be notified of the appointment.
What is a Controlled Function?
This consists of the following functions – Senior Executive Officer; Director; Finance Officer and Compliance Officer. These individuals has to know and meet our regulatory requirements, as well as understand how we apply them. The functions specified in GEN 2.2.2 to 2.2.5 are Controlled Functions (please, go to www.afsa.kz > Legal Framework > Legal Framework > AIFC Financial Services Framework > General Rules).
Who is an Approved Individual?
An Approved Individual is an individual who is approved by the AFSA to carry out a Controlled Function. Approved individuals are employees of Authorised Persons who attract regulatory attention as they occupy the most critical roles in an Authorised Person, which are referred to as “Controlled Functions”. Their appointment requires the approval of the AFSA.
Can I become an authorized firm as an individual in my own right?
The AIFC laws and regulations do not allow for Sole Traders as a legal form of company. Therefore, an individual cannot be authorized in his/her own right to carry on a Regulated Activity, an Ancillary Service or a Market Activity in or from the AIFC. He/she may, however, carry on these services/activities as an Approved Individual or Designated Individual of an AIFC Participant.
What are the Regulated Activities? Is there a list somewhere?
The Regulated Activities are financial services that need authorisation from the AFSA. These include brokers and dealers, investment and fund management, banking, fund administration, providing and arranging custody, islamic finance, and other activities including operating a representative office.
AFSA also authorises professional services that support the financial services industry i.e. Ancillary Services.
There is a list of all the activities with descriptions that are authorised by the AFSA in the AIFC GEN Rules Schedules 1 and 2 (please, go to www.aifc.kz > Legal Framework > Legal Framework > AIFC Financial Services Framework > General Rules).
What companies need to seek authorisation?
Any company intending to carry on one or more Regulated Activity, Ancillary Service or Market Activity in or from the AIFC needs to seek authorisation to become an AIFC Participant. The full list of Regulated Activities, Market Activities and Ancililary Services authorised by the AFSA is included in the Schedules 1, 2 and 4 of AIFC General Rules (GEN). It is important to note that in accordance with Section 24 of the AIFC Financial Services Framework Regulations, a Centre Participant must not carry on a Regulated Activity, Market Activity or Ancillary Service unless it is licensed to do so by the AFSA.
For more information, please, go to www.aifc.kz > Legal Framework > Legal Framework > AIFC Financial Services Framework > General Rules / Financial Services Framework Regulations
What type of companies in terms of their business activity can be registered in the AIFC?
The Center can accommodate a broad range of activities outside the ones that are described as Regulated, Ancillary or Market Activities.
Currently, there is a range of non-financial services firms and holding companies which have been registered by the AFSA as Centre Participants.