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How to start your own business? How to register a company?


How to start your own business? How to register a company?

 


How to start your own business?

 

To start your own  business, first of all, you should decide whether it is necessary to set up a legal entity as  according to the current legislation an individual may carry out the entrepreneurship activity as an individual proprietorship. 

While making the decision to set up a legal entity (a limited liability company, joint-stock company, production co-operative, holding, etc.) the main purpose of which is making  profit it is necessary to define  a form of such legal entity.

Important!
After the state registration you bear the full responsibility for all actions realized by the enterprise till  the moment it is taken off from the state register.
The current legislation stipulates the following forms of the legal entities to carry out business activity: the Limited Liability Partnership (LLP), Supplementary Liability Partnership (SLP), Unlimited  Partnership (UP), Limited Partnership (LP), Production Co-Operative (PC) or Joint-Stock Company (JSC), Individual Proprietorship (IP).
The main categories of the legal entities:

Limited Liability Partnership is a union of one or several persons (participants) who form the authorized capital divided into shares. The Limited Liability Partnership is liable by its obligations with all property belonging it and it is not liable by obligations of the participants.

Participants of the Supplementary Liability Partnership unlike LLP are liable by their obligations with the contributions into the authorized capital. In case the amount of these contributions are not enough – they are liable by the additional property belonging them at a rate multiple to the amount of contributions made.

The authorized capital of the partnership is formed by consolidation of founders’ contributions the  initial size of which is equal to the amount of contributions of founders and it should not be less the amount equivalent to hundred  of monthly calculated rate.

The Production Co-operative is the voluntary union of citizen on the membership basis to carry out the mutual business activity based on the individual participation and consolidation of the property shares of the members. The difference of the Production Co-operative from the Partnership are: it has no an Authorized Capital; it should be not less than two founders of the Production Co-operative; and the members of the Co-operative are liable by the Co-operative obligations with the additional (subsidiary) responsibility.

The main feature of the Unlimited partnership is that all its participants bear equal and collective responsibility by its obligations with all property belonging to them.

The Limited Partnership except one ore more participant which are solidary liable for the Partnership obligation includes also one ore more participant the responsibility of which is limited to the sum they contributed into the Authorized capital of the Partnership and they don’t take parting the business activity of the company.

Joint-stock company is a legal entity which issues its shares  with a purpose to attract the resources for realization of  its business.

When you choose the organizational and legal form of your  legal entity  it is necessary to register the company  and to get the status of the legal entity. For this purpose you apply to the local Department of Justice.
Individual businessmen are the physical person which carry out their economic operations without forming a  legal entity and they don’t have attributes of a legal entity.

 


Individual business

Individual businessmen are individuals carrying out business activity without setting up a legal entity has no any attributes of a legal entity/ there are two types of  individual business:  personal proprietorship  and joint proprietorship.

 Personal  proprietorship is carried out by one person independently on the basis of the property belonging  him/her on the property right and also under other right allowing the use and (or) disposal of the property.

 Joint business (proprietorship) is carried out by a group of citizens (individual businessmen) on the basis of the property belonging them on the right of the common property  and also under the right assuming the joint use and/or  the disposal of the property. In case of the individual proprietorship based on a private property (private business), it is carried out under the property responsibility.

The individual proprietorship pays less taxes and  in  most cases with lower rates  than a legal entity. The individual proprietorship has to pay payments into cumulative pension funds for himself/herself and hired workers.

The size of tax rates depends on a tax mode the businessman works under. In case the proprietorship realizes his/her business using a patent the income of such businessman is imposed at 3%  rate (article 375 of Tax Code of the РК ). In case of using the simplified form of declaration the income is imposed at a rate from 3 up to 7 percent depending on its sum (Article 377 Tax Code of the РК ).

The accountancy  of the individual businessman in case of patent use and simplified form of declaration is much easier than the accountancy of a legal entity. In case of patent there is no practically any accountancy. This  advantage allows the individual businessman to make accountancy by himself/ herself not employing an accountant. However, there is an opportunity of  simplified form of declaration for the legal entities, but in most cases it is necessary to hire an accountant into such company.

After being  registered as an individual businessman this person has to pay for a seal and stamps (over 1000 KT). If you are going to open the bank account it is necessary to pay the notary services who will authorize the  samples of your signature in a bank card (87 KT for a card, total - 4 cards), and also for opening the account, if in the bank you chose this procedure is payable (in most banks the account opening is free-of-charge now, in  some banks up to 3500 KT is payable).


The limited liability company

 

According to the Law of the Republic Kazakhstan " On Limited and Supplementary Liability Companies ” the Limited Liability Company has the firm name which should contain the name of the company and also the words "limited liability company" or an abbreviation "LLP".

The firm name of the Supplementary Liability Company should contain the words "supplementary liability company" or an abbreviation "SLC".

The Limited Liability Company is a commercial organization having the civil rights. The location of the limited liability company is the permanent residence of its constantly working  body.

The Limited Liability Company has a right to set up its branches and representations.
The procedure of setting up of the Limited Liability Company begins with the conclusion of the constituent contract by its founders and finishes by the state registration of a company as a legal entity.

The Constituent (Founders’)Contract
The constituent contract of the Limited Liability Company is to be:

  • made in writing;
  • signed bys each founder or its authorized representative;
  • certified by a notary

The legal entities – the  founders of LLP may be represented by its managers which are authorized to act  on behalf of the  legal entity  without any power of attorney. The refusal of signing the contract means the  refusal to enter the company. It is not allowed to sign the contract any with any clauses the specific features of the status of some participants of the company should be fixed in the contract signed by all founders. The constituent contract is a subject to be certified by a notary. 
The founders who signed the constituent contract after the state registration of company become the participants of company.

The Articles (Charter)
The Articles  of the Limited Liability Company is a  document defining a legal status of the company as the legal entity. .
At the state registration of the company its Articles are  considered as its constituent document. The Articles of the Limited Liability Company should contain:

  • The company name, the residence and the address of company;
  • The list of participants of company (except the companies the register of participants of which is carried out by the registrar with indication of their names, residence,  address, bank account information (if the founder is the legal entity) or a name, residence and ID information  (if the founder is a person);
  • Data on the amount  of the authorized capital of the company;
  • The order of formation and the competence of the company bodies;
  • The procedure of  reorganization and the termination of company operation;
  • The order of distribution of the net profit of company in case of the register of the company participants is carried out by the registrar.

Copies of the Articles of company  and all other documents regarding its further  changes  are kept  in the body which provided  the state registration of the company.

Authorized Capital
The initial size of the authorized capital is equal to the amount of contributions of founders and should not be less than amount equivalent to 100 sizes of a monthly calculation index on the date when the documents were submitted for  the state registration of the company. The contribution into the authorized  capital of the Limited Liability Company can be made in the form of money, securities, things, property rights, including the right of land tenure and the right for the  results of intellectual activity and other property.

Production Co-operative

The production co-operative is formed by the  decision of the General meeting of the founders – the individuals. Members of cooperative society should be not less than two, also a member of cooperative society can be any  person over 16 years old  who expresses his/her desire to be a member of cooperative society and capable to contribute his/her  labour force in the company operation. The infants need to get the consent of their parents, adoptive fathers or trustees to enter into the cooperative society.
The production co-operative has a right to carry out any type of business activity which is not forbidden by legal acts for individual proprietorship. If it is required to get a state license for some types of business the Production  co-operative may carry out such business after getting such license.

The constituent contract
The constituent contract of production co-operative is a document of trade secret and is  to be submitted into  state and other official bodies, and also to the third parties only by the decision of the executive body  of cooperative society or in  cases established by legal acts. It should be:

  • made in writing;
  • signed bys each founder or its authorized representative;
  • certified by a notary

The Articles (Charter)
Articles of the Production Co-operative should contain:

  • The firm  name of the Production Co-operative;
  • The order of formation of regulations about the structure and the competence of authority and inspection body of the cooperative society and decision making procedure, including the issues which have to be decided unanimously or by  the qualified majority of votes;
  • The order of distribution of the net profit and losses of the cooperative society;
  • The order of reorganization and liquidation of the cooperative society;
  • The size of a share of each member of production co-operative, structure and  order of making the property contributions by members of the production co-operative and their responsibility for infringement of the contribution obligation;

In case of claiming for a share the cooperative society allocates a share from the  property of the cooperative society, corresponding to the share of  the member-debtor. The size of a share is defined according to accountancy data for the  date of receipt of the claim of the creditor (creditors).
The share is made by money or in natural form.

Property contribution of members of the cooperative society.
Property contributions of members of the production co-operative form the initial capital and are assigned to  organize the cooperative society activity and also to cover the charges. A property contribution into cooperative society may be made by money, securities, things, property rights, including the right of land tenure, the right to results of intellectual property and other property.

The monetary estimation of a property contribution of a member of the cooperative society cannot be made only under the agreement between the founders of the cooperative society and is subject to independent auditor’s  checking. Independent auditor’s checking  is not made in cases when the  property contributions of members of the cooperative society consist only of money. In case the property is transferred by a member of the cooperative society as a contribution into cooperative society only for  using the size of contribution is defined on the basis of  rental payment for using this property, calculated  for the period determined by  the agreement of the cooperative society members.



Joint- Stock Company

Founders of the joint-stock company are individuals  and/or legal entities who made a decision to set up it. The founder of a company may be one person. The JSC is established by the decision of founders meeting. The company may be set up in the result of reorganization of the existing legal entity in the order established by the Law " On Joint-Stock Companies" dated May, 13th, 2003 and other legal acts of the Republic Kazakhstan.
On the first constituent assembly the founders:

  • decide on establishment of a company and define the order of joint actions on creation the company;
  • develop the constituent contract;  
  • establish the size of the advance payment of founders’ shares;
  • establish the quantity of the declared shares, including the shares which are to be paid by the  founders;
  • decide on the state registration shares declared for the issue;
  • elect the registrar of the company;
  • elect the persons authorized to sign documents for the state registration on behalf of the company;
  • define the persons who in accordance with the Republic of Kazakhstan legislation will estimate the property contributed by company founders into the authorized capital the company;
  • elect the persons authorized to carry out financial and economic activity of the company and to represent its interests before the third parties till the formation of the company bodies;
  • Approve the Articles of Association. 

Before the stock floatation it is possible to arrange several subsequent meetings of founders. The decisions made on the first constituent assembly might be amended and added only if all parties of the constituent contract participate in the constituent assemblies. On the first constituent assembly of the company each of founders has one vote. On the subsequent constituent assemblies each of founders has one vote  if other is not established by the constituent contract. Decisions of the constituent assembly (the sole founder) are indicated in the protocol and are to be signed by all founders (sole founder) of the company.

The constituent contract is to be:

  •  made in writing;
  • signed by the founder or its representative;
  • certified by a notary;

The Articles of Association is a  document defining a legal status of the  company as of  the legal entity.
The Articles of Association  should contain:

  • Full and abbreviated names of the company;
  • The location of the executive body of the company;
  • information on the rights of shareholders including the volume of rights certified by the preferred shares of the company;
  • The order of formation and the competence of the company;
  • The order of the organization of the company bodies activity, including: the order of convocation, preparation and holding  the  general meeting of shareholders and sessions of joint bodies of the company;
  • The decision-making procedure by the company bodies, including the list of questions decisions on which should be made by the qualified majority of votes;
  • The order of informing the shareholders of the company on its business activity indicating the name of mass media used for the publication of such  information;
  • The order of giving the information on the affiliations by the  shareholders and officials of the company;
  • In case the company is the noncommercial organization: is should be indicated that the company is a noncommercial organization, regulations on voting procedure, nonpayment of dividends and other requirements established by the Law and other acts of the Republic of Kazakhstan; Conditions of the termination of the company business activity;
  • Other provisions in accordance with the Law and other acts of the Republic of Kazakhstan.

Authorized Capital

  • Authorized Capital of the company is formed at the account of shares paid by founders (the sole founder) for their principal value and investors paid for the of its shares placing and  denominated in the  national currency of the Republic of Kazakhstan.
  • Authorized Capital of the company created as a result of reorganization, is formed in accordance with the requirements established by the Law "On Joint-Stock Companies".

The size of the advance payment of shares contributed by founders should be no less of the minimal size of the authorized capital of the company and is completely paid by founders within thirty days from the date of the state registration of the company as legal person. The authorized capital of the company may be increased by placing of the declared shares of the company. The minimal size of the authorized capital of the company makes 50 000  of the monthly calculation index established by the Republic of Kazakhstan law on the republican budget for the appropriate fiscal year.

Shares
The company  has a right to issue ordinary and preferred shares. The shares are issued in the paperless form.

Attention!
The share is indivisible.  If the share belongs to several persons on the right of the common property all of them are recognized as one shareholder and have the rights certified by the share through the common representative.
The following restrictions can be established by the legal acts of the Republic of Kazakhstan:

  • Making  deals with the company shares;
  • Maximum quantity of the company shares belonging one shareholder;
  • Maximum quantity of votes for the shares of the company given to one shareholder.

The company has a right to issue other securities which  conditions and order of issue, placing, circulation and paying off  are established by the Republic of Kazakhstan law on securities market.


How to register a company?

The order of registration of legal entities is regulated by the  by the Law of the Republic of Kazakhstan " On state registration of legal entities and registration of branches and representative offices " dated from April, 17th, 1995.
The state registration of legal entities includes:

  • Checking the conformity of constituent and other documents;
  • granting the certificate on state registration with assignment of registration number;
  • Entering the data on legal  entities into the Uniform State Register.

Accounting registration  of branches and representative offices  includes:

  • Checking the conformity of constituent and other documents;
  • granting the certificate on accounting registration with assignment of registration number;
  • Entering the data on branches and representative offices into the register of branches and representations.

The bodies of the Ministry of Justice  provide (registering bodies)  the state registration of legal entities and accounting registration of branches and representative offices. 
Below is the list of documents submitted for the state registration and a re-registration of the legal entities.

The following documents must be submitted the registration of the legal entity:

Individual Proprietorship (IP)

  • application for the state registration according to an  established sample;
  • a receipt or copy of a payment order  on payment of the  registration fee (4120 KT).


Production Co-operative (PC)

  • application for the state registration according to an  established sample;
  • Articles of the company approved by the  general meeting of participants in the state and Russian languages in triplicate;
  • The constituent contract in the state and Russian languages in triplicate, signed by all participants (at will of participants) or the list of members of cooperative society indicating  a surname, a name, a patronymic name, date of  birth and residence;
  • document certifying the company location;
  • a receipt or copy of a payment order  on payment of the  registration fee (7600 tenges).
  • A power of attorney in a case of submitting the  documents by a  the third person.


Limited Partnership (LP)

 

  • application for the state registration according to an  established sample;
  • Articles of the company in the state and Russian languages in triplicate approved by founders and duly authenticated by a notary,
  • The constituent contract in the state and Russian languages in triplicate, signed by all participants and duly authenticated by a notary;
  • document certifying the company location;
  • a receipt or copy of a payment order  on payment of the  registration fee (7600 tenge).
  • A power of attorney in a case of submitting the  documents by a  the third person.

Unlimited Partnership (ULP)

 

  • application for the state registration according to an  established sample;
  • Articles of the company in the state and Russian languages in triplicate approved by founders and duly authenticated by a notary,
  • The constituent contract in the state and Russian languages in triplicate, signed by all participants and duly authenticated by a notary;
  • document certifying the company location;
  • a receipt or copy of a payment order  on payment of the  registration fee (7600 tenges).
  • A power of attorney in a case of submitting the  documents by a  the third person.

Limited Liability and Subsidiary Liability Partnership (LLP and SLP)

 

  • application for the state registration according to an  established sample;
  • Articles of the company in the state and Russian languages in triplicate approved by founders and duly authenticated by a notary,
  • document certifying the company location;
  • a receipt or copy of a payment order  on payment of the  registration fee (7600 tenges).
  • A power of attorney in a case of submitting the  documents by a  the third person.

Joint-Stock Company (JSC)

  • application for the state registration according to an  established sample;
  • Articles of Association approved by the Founders’ Meeting or a sole founder,  duly authenticated by a notary in the state and Russian languages in triplicate;
  • Protocol of the Founders’ meeting
  • document certifying the company location;
  • a receipt or copy of a payment order  on payment of the  registration fee (7600 tenge).
  • A power of attorney in a case of submitting the  documents by a  the third person.

 Registration of legal entities with foreign companies   participation is provided in the order established for the registration of legal entities of the Republic of Kazakhstan the following documents must be submitted in addition:

  • A legalized excerpt from a Trade Register or another legalized document certifying  that the founder is a foreign legal entity;
  • A notarized excerpt;
  • A notarized photocopy of a passport

For the state registration of a legal entity which was set up in the result of reorganization of one or more legal entities it should be also submitted a transfer deed or division balance sheet, document certifying the written notice of creditors of the reorganized company on such reorganization. 

The following documents must be submitted for the re-registration of a legal entity:

Joint-stock Company (JSC)

 

  •  application for the state re-registration according to an  established sample;
  • The decision or an excerpt  from the Resolution  of General Meeting of Shareholders on entering the amendments and additions in the constituent document, sealed by the joint-stock company seal;
  • the Articles with amendments  and  additions made and  approved by the  General Meeting of Shareholders, certified by a  notary in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Articles or the amendments  and additions can be made as an appendix to the existing Articles;
  • original constituent documents;  
  • an  original certificate on the state registration (re-registration) of a legal entity;
  • an original statistical card;
  • an  original of the certificate on registration of the tax payer;
  • a receipt or copy of the payment order on payment of re-registration  fee (7600 KT).
  • a power of attorney if the documents are submitted by a the third person.


Production Co-operative (PC)

 

  • application for the state re-registration according to an  established sample;
  • The decision or an excerpt  from the Resolution  of General Meeting of Co-operative on entering the amendments and additions into the Articles and  the Constituent Contract, sealed by the company seal;
  • the Articles with amendments  and  additions made and  approved by the  General Meeting of Co-operative in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Articles or the amendments  and additions can be made as an appendix to the existing Articles;
  • the Constituent Contract with amendments  and  additions made and  signed by all members of the Co-operative by the  General Meeting of Cooperative in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Constituent Contract or the amendments  and additions can be made as an appendix to the existing Constituent Contract;
  • original constituent documents;  
  • an  original certificate on the state registration (re-registration) of a legal entity;
  • an original statistical card;
  • an  original of the certificate on registration of the tax payer;
  • a receipt or copy of the payment order on payment of re-registration  fee (7600 KT).
  • a power of attorney if the documents are submitted by a the third person.


Limited Partnership (LP)

 

  • application for the state re-registration according to an  established sample;
  • The decision or an excerpt  from the Resolution  of General Meeting of the Partnership on entering the amendments and additions into the Articles and  the Constituent Contract, sealed by the company seal;
  • the Articles with amendments  and  additions made and  approved by the  General Meeting of the Partnership in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Articles or the amendments  and additions can be made as an appendix to the existing Articles;
  • the Constituent Contract with amendments  and  additions made and  signed by all members of the Partnership by the  General Meeting of the Partnership  in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Constituent Contract or the amendments  and additions can be made as an appendix to the existing Constituent Contract;
  • original constituent documents;  
  • an  original certificate on the state registration (re-registration) of a legal entity;
  • an original statistical card;
  • an  original of the certificate on registration of the tax payer;
  • a receipt or copy of the payment order on payment of re-registration  fee (7600 KT).
  • a power of attorney if the documents are submitted by a the third person.


Unlimited Partnership (ULP)

 

  • application for the state re-registration according to an  established sample;
  • The decision or an excerpt  from the Resolution  of General Meeting of the Partnership on entering the amendments and additions into the Articles and  the Constituent Contract, sealed by the company seal;
  • the Articles with amendments  and  additions made and  approved by the  General Meeting of the Partnership in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Articles or the amendments  and additions can be made as an appendix to the existing Articles;
  • the Constituent Contract with amendments  and  additions made and  signed by all members of the Partnership by the  General Meeting of the Partnership  in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Constituent Contract or the amendments  and additions can be made as an appendix to the existing Constituent Contract;
  • original constituent documents;  
  • an  original certificate on the state registration (re-registration) of a legal entity;
  • an original statistical card;
  • an  original of the certificate on registration of the tax payer;
  • a receipt or copy of the payment order on payment of re-registration  fee (7600 KT).
  • a power of attorney if the documents are submitted by a the third person.


Limited Liability or Subsidiary Liability Partnership (LLP or SLP)

  • application for the state re-registration according to an  established sample;
  • The decision or an excerpt  from the Resolution  of General Meeting of the Partnership on entering the amendments and additions into the Articles and  the Constituent Contract, sealed by the company seal;
  • the Articles with amendments  and  additions made and  approved by the  General Meeting of the Partnership in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Articles or the amendments  and additions can be made as an appendix to the existing Articles;
  • the Constituent Contract with amendments  and  additions made and  signed by all members of the Partnership by the  General Meeting of the Partnership  in the state and Russian languages in triplicate. The amendments and additions can be entered in two ways: by making a new version of the Constituent Contract or the amendments  and additions can be made as an appendix to the existing Constituent Contract;
  • original constituent documents;  
  • an  original certificate on the state registration (re-registration) of a legal entity;
  • an original statistical card;
  • an  original of the certificate on registration of the tax payer;
  • a receipt or copy of the payment order on payment of re-registration  fee (7600 KT).
  • a power of attorney if the documents are submitted by a the third person.

The state registration (re-registration) of subjects of small business and accounting registration (re-registration) of their branches and representative offices should be made not later than 3 working days from the date of submitting an application with necessary documents attached.

The state registration (re-registration) of other legal entities and accounting registration (re-registration) of their branches and representative offices should be made not later than 10 working days from the date of submitting an application with necessary documents attached.

 The state registration (re-registration) of political parties and registration accounting registration (re-registration) of their branches and representative offices should be made not later than 1 month from the date of submitting an application with the  necessary documents attached.

After checking the constituent and other documents of legal entities for their conformity the registering body grants the certificate on state registration or the certificate on a re-registration.

The  certificate on accounting registration or certificate on accounting re-registration is granted to  branches and representative offices.

You can open a bank account only by submitting the certificate on state registration of the legal entity or the certificate on accounting registration of branches  and representative offices.

The note :
The granting of the certificate on state registration of a legal entity is not the basis to start the business activity.

 

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