Company registration with MFCA

Registering a company within the MFCA allows applicants to officially set up new business entities and shift from foreign jurisdictions. Available forms of incorporation let business owners opt for a feasible corporate structure with an industry-related focus to adapt to the local legislative environment and market requirements. Astana International Financial Centre (AIFC) is among the renowned regional financial hubs and the jurisdiction embracing an autonomous legal system.

Company registration in Astana International Financial Centre (AIFC) provides interested parties - local business entities and participants of cross-border business activities - with unprecedented access to a wide range of legal and financial instruments, institutional support, tax preferences, and investment protection mechanisms, which, together with an independent judicial system and arbitration operating under English law standards, favour the sustainable growth of corporate structures. The International Financial Centre ‘Astana’ of the Republic of Kazakhstan is a key regional zone providing effective interaction of financial and economic systems of the states of the Central Asian region, the South Caucasus, western provinces of China, countries of the Middle East region, and a number of European jurisdictions, and the presence of a favourable fiscal regime, including reduced rates, tax holidays and other financial preferences, significantly increases the interest of foreign applicants to register companies in the International Financial Centre ‘Astana’.

Registering a company in MFCA Kazakhstan: conditions that stimulate internationalisation of business

In an environment of increasing globalisation and transformation of legal regimes for doing business, the choice of jurisdiction for company registration is of strategic importance. In this context, the Astana Financial Centre operating in the Republic of Kazakhstan provides international participants with access to a preferential legal environment focused on English common law standards and regulatory independence.

Given its sustainable economic development and improving legal framework, the Republic of Kazakhstan is building a competitive system for the realisation of innovative investment initiatives. Business registration in the International Financial Centre ‘Astana’ is an effective tool for entering the economic system of the region, facilitating international legal protection of capital and access to cross-border markets. The main advantages of registration in the MFCA are described below.

Regulation of business activities in MFCA is delegated to the Astana Financial Services Market Control Agency (AFSA), which aims to create conditions of equality and fairness in the market for all its participants. AFSA functions as an independent body responsible for regulatory and supervisory oversight of all entities conducting licensed activities in the Centre. AFSA's competence extends to persons carrying out professional activities in the financial and non-financial sectors, including capital markets and related services provided for in the IFCA regulations.

AFSA has implemented the norms of international prudential supervision in line with the standards set by global organisations such as IOSCO, IAIS, BCBS, IFSB, and FATF. Potential participants can initiate the online company registration procedure with the MFCA through the eResidence digital platform. Legal entities registered in the MFCA have access to a preferential fiscal regime designed to take into account the provisions of the BEPS Plan and adapted to the specifics of their economic activity. This regime provides significant fiscal incentives for authorised entities engaged in the provision of financial and professional services. Fiscal preferences apply to both legal entities and individuals, including foreign specialists, which significantly increases the attractiveness of MFCA for representatives of the financial sector.

Registering a business in MFCA provides an opportunity to enjoy a unique currency regime, which has no analogues in other jurisdictions of Kazakhstan. This regime provides significantly more freedom and flexibility in currency transactions, which is especially important for companies operating in global markets. However, only legal entities with a valid licence issued by the MFCA can take advantage of these advantages. One of the advantages of this currency regime is the ability to conduct settlements in any freely convertible currency without restrictions, which greatly simplifies interaction with foreign partners and investors, as well as contributes to the effective management of cash flows.

The process of company registration in MFCA, to encourage foreign participation and attract qualified specialists, includes a simplified procedure for visa documents and labour permits. Labour visas for up to five years may be granted to foreign specialists and their accompanying family members who are in employment or other contractual relations with MFCA entities. Procedures for issuing, prolonging or changing visa regimes can be carried out without the need to leave the territory of the host state. These measures are aimed at creating a favourable legal regime to ensure the effective integration of foreign investors and expats into the economic environment of MFCA in accordance with international standards and the principles of openness, transparency, and legal certainty.

Starting a business in MFCA: choosing an investment area

IFCA focuses on technological innovation and sustainable economic growth. This financial hub offers competitive advantages, including access to foreign sources of financing, modern regulatory mechanisms, and fiscal incentives. Before opening a company in MFCA, it is advisable to familiarise yourself with the list of permitted, regulated activities and the specifics associated with their implementation. This will allow not only compliance with all regulatory requirements but also optimal choice of a suitable business sphere, corresponding both to the internal interests of the entrepreneur and to the external economic and legal conditions stipulated by the IFCA legislation.

If you are interested in registering a business in MFCA Kazakhstan, please note that this regional financial hub was established to attract and serve financial companies aiming to expand in the rapidly developing region. MFCA's regulatory and institutional arrangements extend to investment, wealth management, insurance, and Islamic financial practices, providing corporations with the necessary tools for legal integration and operational sustainability. MFCA's innovative focus and support for digital transformation create a unique environment for the establishment and growth of fintech companies.

A company can be registered with MFCA Kazakhstan in the financial sector to provide the following services:

• Professional control and optimisation of investment assets in portfolios to ensure maximum risk-adjusted returns.
• A wide range of financial transactions, including deposit taking, lending, cash flow management in compliance with regulatory requirements.
• Professional intermediation in securities transactions, derivatives, and other financial instruments to fulfil investors' interests.
• Providing custody and administration of financial assets for clients, including ensuring that assets are properly recorded and protected from third parties.
• Undertaking insurance contracting operations, as well as managing insurance reserves and claims payments.
• Carrying out Shariah-compliant financial transactions, including interest-free lending, initiation of asset swap transactions, and investments subject to Islamic norms.
• Administering the stock exchange, including regulating trading processes, monitoring compliance with established norms and standards, and introducing new mechanisms.
• Managing a multilateral platform for the exchange of financial assets, ensuring a secure trading process.
• Performing trust fund administration duties, including managing property and assets on trust for the benefit of clients.

You can launch a fintech project in MFCA as a member of the FinTech Lab. This is a specially established regulated experimental sandbox where financial technology and RegTech entities are allowed to test innovative solutions without having to comply with all applicable financial regulatory requirements immediately. Participation in this initiative provides companies access to regional markets at minimal cost and with limited initial resources, while allowing for the phased implementation of regulatory compliance measures during testing.

Testing of new products, services, and technological solutions involves a limited number of real users in a controlled environment, allowing for data collection, identifying potential regulatory risks and ensuring their subsequent elimination before the project is commercialised at full scale. Thus, the launch of a fintech startup in MFCA Kazakhstan's FinTech Lab serves as a mechanism of interaction between innovators and the regulator, helping to stimulate innovation while preserving the stability and integrity of the financial system.

We note here that the Global Financial Innovation Network (GFIN) was formally established in January 2019 by a global group of financial regulators and related organisations, including AFSA. GFIN is a network of 50 organisations that aims to encourage the development of fintech initiatives with a focus on consumer advocacy. It is a pilot project for companies interested in testing innovative products and business models in several jurisdictions.

It is possible to register a business in the MFCA Kazakhstan for activities related to the provision of professional services that are essential for the sustainable development of local institutional and infrastructural environments. The MFCA regulator provides for the possibility to issue licences covering an extensive list of professional services, like

• Carrying out auditing and accounting activities
• Provision of consulting and analytical (including strategic and financial consulting) services
• Legal support in international corporate law matters
• Independent credit rating assessment under international standards.

Each line of business is subject to compulsory licensing per MFCA regulations, which includes conditions for the qualification of specialists and the implementation of an effective internal control system. In addition, the registration of a company in MFCA Kazakhstan obliges to ensure strict adherence to the principles of integrity and transparency and to take measures aimed at compliance with the legislative requirements in the field of AML/CFT, which requires the introduction of comprehensive mechanisms to prevent these criminal acts.

How to register a company with MFCA

The initial stage of company registration with MFC Astana (Kazakhstan) is to make an informed decision on the optimal form of the company. This choice is determined by many factors, among which the most significant: the scope and specificity of the forthcoming commercial activities, the degree of limited liability of the founders, taking into account financial and fiscal aspects. Each of these circumstances has an impact on the long-term legal and economic sustainability of the organisation. Whether you are interested in registering a new company with MFCA or you are interested in redomiciling a legal entity, you can choose from the organisational forms described below.

A limited liability company is a form of business organisation where the liability of each participant is limited solely to the amount payable in respect of their shares in the capital. This legal entity qualifies as a private company; therefore, it is not entitled to make a public offering or free circulation of its shares on organised securities markets. The minimum number of founders is one (1), and the founder may be either an individual or a corporate entity. A mandatory condition for legal recognition of the company name is the direct inclusion of the word ‘Limited’ or the abbreviation ‘Ltd.’. The requirements for registration of a company with the AIFC in Kazakhstan do not provide for the deposit of a minimum capital account. The firm is managed by one (1) director, and no legal entity may be appointed to this position - only a natural person may act as a director.

A public company is a legal entity whose members' liability is limited by the amount of unpaid capital on their shares. Such an organisation has the right to make a public offering of its securities to an unlimited number of persons. Legislation stipulates that the name must include the word ‘Public’ or the abbreviation ‘PLC’. The minimum number of shareholders required to establish a company in MFCA in the form of a PLC is one (a natural person or a legal entity is allowed). The minimum statutory capital is USD 100,000. THE MINIMUM STATUTORY CAPITAL IS US$100,000. It is managed by at least two directors and at least one corporate secretary.

The authorised capital of an SPC shall be formed taking into account the specifics and scope of the respective investment project. The intended purpose of the SPC should be limited to carrying out exclusively the so-called ‘exempt activities’, which are understood to be the following types of transactions:

• Acquisition (including through leasing, assignment of rights or otherwise), subsequent possession/disposal of assets of both tangible and intangible nature (including receivables and corporate rights), carried out on the terms of a specific transaction and solely for its fulfilment
• Raising any type of financing (including bank financing and through capital markets), encumbering SPC assets with security obligations, providing guarantees, compensation or equivalent support in favour of shareholders or affiliates, entering into agreements on hedging risks arising in connection with the subject transaction
• Financing of the project initiator or other legal entity having the status of a special project company;
• Acting as a trustee, agent or other authorised representative in the interests of any of the parties to the relevant transaction.

It is possible to open a business in MFCA in the form of a general partnership on the basis of an agreement between at least two legal entities with subsequent registration under the established procedure. According to the requirements of the current MFCA regulation, the partnership must have a permanent registered office on the territory of the centre, designed to receive official correspondence, including notices, orders, and other legally significant documents. Following the principles of joint and several liability, each general partner has unlimited liability for the debts of the partnership with the other partners. The legal relations of the parties are formalised through a partnership agreement, which is legally binding if signed by all partners. The commercial designation of the general partnership must contain identification of the form of ownership (such as ‘partnership’ or ‘& Co’).

Foreign applicants may register a company with the AIFC in the form of a limited partnership (formed by a minimum of two individuals or corporations). The managing partner is fully liable for all debts arising out of the partnership. The silent partner is liable solely to the extent of its contributions actually made or to be made under the partnership agreement. Registration of a limited partnership with the MFCA requires the drafting and signing of a partnership agreement. The business name must contain the ending ‘Limited Partnership’.

The organisation of a limited liability partnership is another form available to foreign applicants. The partners are not liable for the obligations of the partnership beyond their contributions made or to be made. A prerequisite for the legitimate operation of an LLP is the inclusion of a verbal indication of the legal form - ‘Limited Liability Partnership’ or ‘LLP’ in the name.

Foreign legal entities are allowed to register and operate in MFCA by establishing a branch or representative office. Such legal structures require the permanent presence of at least one authorised person, who is responsible for receiving documents or communications addressed on behalf of the accredited company. If an accredited firm intends to obtain authorisation for regulated activities, an application may only be made in respect of a category of operations for which the parent entity holds a valid licence issued by the relevant regulatory authority in its jurisdiction of incorporation.

A business in MFCA Kazakhstan can be established in the form of an investment company operating as a specialised corporate law entity providing investors with complex financial intermediation services (investment portfolio management, custodial services, accounting administration, legal support of investment activities). The organisational structure allows for the management of a sole director (the appointment of a corporate person to the relevant position is permitted). Legislation regulating the activities of such companies establishes mandatory name prescriptions:

• For closed-end investment companies - ‘Closed-Ended Investment Company’ or ‘CEIC’;
• For open-ended investment companies - ‘OEIC’ or ‘OEIC’.

In addition to the above-mentioned legal structures, it is possible to create a private fund in the MFCA of Kazakhstan. It is an independent legal entity governed by a Charter (Charter) and local regulations (By-laws). It is possible to establish a foundation not only for charitable purposes, but also to provide benefits to certain persons whose interests are explicitly stated in the foundation's charter documents. Such persons may be designated by name or grouped into a particular category or class, for example, they may be family members of the founder, employees of the company, representatives of a particular professional group, etc.

A private foundation cannot act as a full-fledged commercial entity whose main interest is profit-making. However, it may carry out those operations that are auxiliary or contribute to the fulfilment of statutory objectives. The foundation must have a council (Council), which manages the assets and realises the objectives, and a guardian (Guardian), who assumes the key function of supervising the activities of the foundation, ensuring that they are consistent with the stated objectives and the interests of the beneficiaries.

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How to open a business in MFCA

If an organisation plans to carry out financial or market activities subject to regulation in MFCA, it is required to undergo two consecutive procedures:

• Authorisation (licensing) procedure with AFSA.
• Registration in accordance with the established procedure.

Registration of a company with the International Financial Centre Astana (MFCA) is a multi-stage process, which includes both the preparatory stage and the stages of application, document verification, obtaining an official Certificate of Incorporation, and post-registration stages (such as opening an account in the company's name). The step-by-step process of company registration with AIFC is described below.

Determining the type of activity: financial or non-financial activities

At the initial stage of registration, it is necessary to determine the type of activity of the company. Depending on this, there are different requirements for statutory and financial documents, and the need to comply with specific rules and regulations relating to financial operations. If the company is engaged in non-financial services, the registration process may be somewhat simpler.

Next, in the process of registering a business with MFCA, it is necessary to choose the form of the company (we have described the main ones above). This choice is of key importance, as it determines the capital structure, the responsibility of the founders, and possible tax and legal obligations.

At this stage, a package of documents for registration must be prepared and properly executed. These include:

• Application for incorporation
• Statutory documents of the company
• Documents identifying the identity of the founders and management
• Documents proving the existence of a local registered office
• Financial statements (for large corporations).

The application for registration is submitted through the official online platform of MFCA. The platform provides all necessary tools for filling in/executing documents and for tracking the status of the application during the review process. A registration fee must be paid when applying. The amount to be charged is based on the chosen legal form and business line.

Once the application is submitted, the review phase begins. The regulator checks the submitted documents for compliance with Kazakhstan legislation and MFCA internal regulations. Particular attention is paid to the correctness of filling out the documents, compliance with the declared types of activities. If a firm plans to engage in activities that require licensing, it may be required to submit additional documents, such as evidence of the availability of necessary funds to maintain financial stability and other documents confirming the ability to conduct the declared activities.

Once all documents have been checked and the application has been approved, a Certificate of Firm Registration with the MFCA is issued. From this moment, the company is entitled to start its activities and enjoy the benefits provided by the centre for participants. The terms of company registration in MFCA may vary depending on the complexity of the business and completeness of the submitted documents, the specifics of the functioning of the organisational form. For example, for private companies, the registration procedure may take from five working days, starting from the moment of submission of a complete set of documents. The registration procedure is fully digitalised, so it is possible to register a company with the AIFC remotely.

Meanwhile, it is possible to open a company in the Astana International Financial Centre (AIFC) through one of the following legally permissible mechanisms:

• Incorporation of a new legal entity
• Registration of a foreign company or partnership as a Recognised Company or Recognized partnership under the internal regulations of MFCA
• Redomiciliation of a legal entity originally established in a foreign jurisdiction to transfer its registered office and subject its activities to the regulatory requirements of MFCA.

Types of licences in MFCA Kazakhstan

Conducting regulated financial, market or professional (ancillary) activities within MFCA is allowed only if there is a valid authorisation document - a licence issued by AFSA. Licence is not only a prerequisite for legitimate entry of legal entities and individuals into the regulated environment, but also serves as a basis for granting the regulator discretionary powers to identify, suppress and prevent systemically significant violations of legislation, or acts that may cause significant harm to the interests of financial market participants or disrupt public order within MFCA.

Obtaining a licence from MFCA requires the applicant to provide convincing evidence of its financial strength, including documents proving that it has sufficient assets and liquid funds to ensure the conduct of the requested activity. The applicant must also demonstrate an adequate level of capitalisation that will meet the requirements set by the regulatory authorities of MFCA. The main types of licences are described below.

Banking licence

Provided to credit institutions intending to provide retail and corporate banking services, including, but not limited to, opening settlement and other types of accounts, providing credit resources on various financing terms, including short-term and long-term lending, providing cash and settlement services, including execution of payment orders and other transactions involving transfer of funds both in the domestic and international banking system, carrying out operations with purchase and sale of foreign currency, hedging of currency risks and other actions regulated by the legislation on currency regulation and currency control.

Investment licence

It is intended for commercial organisations whose main or auxiliary activities are related to investment intermediation, financial engineering, professional activities on the securities market, including, but not limited to, carrying out individual investment consulting within the framework of the authority provided for by the current legal and regulatory framework, development and implementation of investment portfolio strategies, carrying out analytical assessment of investment risks, provision of other services and services, as well as investment advisory services.

Licence to carry out insurance activities

Registration of a financial company with MFCA (Kazakhstan) engaged in insurance activities requires a licence. Such a licence entitles the company to offer various types of insurance, including but not limited to life insurance, property insurance, liability insurance, and reinsurance, including risk management and reinsurance treaty services.

Fintech licence

Provides a legal basis for carrying out activities related to the offering of fintech services. This covers a wide range of innovative products and services aimed at optimising financial transactions. Among other things, foreign applicants often ask how to register a payment operator in the MFCA Kazakhstan. Also, this type of license provides grounds to engage in the issuance, storage, conversion, exchange, and management of digital assets; the operation of smart contracts; tokenised solutions; and the development and implementation of blockchain platforms focused on the financial sector.

In particular, a popular request among foreign applicants is the registration of a cryptocurrency company in MFCA Kazakhstan. The incorporation procedure is carried out taking into account the provisions of the legislation on digital assets updated in April 2023. This legislative act laid down a comprehensive regulatory framework for the issuance, initial placement, subsequent circulation, and other turnover of digital assets, including, but not limited to, tokenised financial instruments and cryptocurrencies. The Law institutionalised the legal status of entities involved in the processes of digital asset generation, such as data centre operators and persons engaged in mining.

Asset management licence

Gives the right to organisations and individual managers to work with clients' capital. This licence allows financial professionals to manage investments, portfolios, real estate, and other assets on a fiduciary basis, making decisions to buy, sell or reallocate funds. This opens up opportunities for financial professionals to provide comprehensive wealth management services, which is in demand among clients looking for qualified and responsible administration of their financial assets.

Trust Management Licence

Suitable for organisations performing trust management of assets through concluded contracts. It provides a legal opportunity to perform services for the disposal of assets based on the principles of trust management, including the management of corporate rights, other actions aimed at ensuring that the interests of the principal are respected, and the assets transferred to it are used effectively.

Licence for capital market participants

The licence covers the administration of exchange trading systems, organisation of clearing activities to ensure settlement of securities and derivatives transactions, and management of digital asset platforms that meet the requirements for storage, exchange, and transfer of tokenised assets. In addition, the licence covers the management of crowdfunding platforms of both investment and debt nature, and the management of specialised platforms for private (non-public) financing, which serve as a tool for raising capital from a limited number of qualified investors.

Licence for consulting services

This is a mandatory form of authorisation for organisations working in the field of finance and investment. Registration of a company with MFCA and obtaining this type of licence allows to offer, in addition to traditional financial and investment advice, the development and implementation of investment strategies, legal advice on taxation, advice on international finance, mergers and acquisitions (M&A), corporate structure and corporate governance, compliance and regulatory issues.

Leasing licence

Required for companies engaged in leasing operations (both financial and operational). This licence provides a legal basis for the execution of transactions related to the leasing of equipment, vehicles, or other objects, and defines the legal terms and obligations of the parties involved in leasing agreements.

Licence to operate a multilateral trading platform

Authorises the operator of a multilateral trading platform to ensure the smooth operation of the trading facility, including the functions of admission to trading, order routing, order matching and execution of transactions in respect of investment assets, derivatives, rights to investments or rights to income arising from investment commitments.

Licence for Islamic finance companies

Provides for the performance of activities as a Shariah dealer or broker based on Islamic contracts and the subsequent raising, placement, and management of customer funds in strict compliance with Shariah law. This licenced status allows the entity to perform the functions of administering profit-sharing investment accounts, where one party provides capital and the other party provides management competence, followed by profit sharing on agreed terms.

Licence for trustees

Provides the right to professionally carry out activities in the field of fiduciary asset management. It covers the provision of comprehensive trust services, including the establishment and administration of trusts, and the performance of trustee functions in the interests of fund beneficiaries.

Launching an investment project in MFCA Kazakhstan: Fiscal obligations

MFYA participants benefit from a special tax regime, which is in strict compliance with the provisions of the BEPS plan, providing extensive tax preferences to legal entities involved in financial and economic activities and the provision of professional services. A similar approach to tax incentives is extended to individuals, including foreign experts, thus ensuring the competitiveness of MFCA as an international financial hub.

Registration of AstanaHub Technopark participants gives the right to claim additional tax benefits if a legal entity carries out activities in the IT sphere and these activities are included in the list of priority areas approved by authorised bodies. Astana Hub International Technopark functions as an innovation cluster established in Astana to implement the state strategy of digitalisation and the development of high-tech industries.

The technopark has created a system of support for technological entrepreneurship, including accelerator mechanisms, incubators, expert support, and institutional channels of interaction with the investment community and government authorities. Registration of a company in Astana Hub also opens access to participation in events aimed at stimulating scientific, technical and innovative activity. In Astana Hub, exemption from all taxes, except for dividend tax for non-residents (5%) and royalty tax (0% until 01.01.2024), is valid until the end of 2029.

Conclusion

Registration of a company in MFC Astana may become an optimal solution for venture investors, asset managers, and technology companies. In MFCA, business entities with the appropriate legal capacity and licence are entitled to carry out operations aimed at providing access to cross-border markets in the Eurasian region while having the opportunity to use modern institutional and technological infrastructure, operating in an autonomous legal system based on the principles of common law, which together provide legal predictability and protection of the rights of participants.

Experts of our firm can provide legal support for registration with the AIFC. Our services include legal analysis of the client's goals and objectives, with the subsequent development of an optimal model of corporate structure, including recommendations on the choice of organisational form under the current AFSA regulations. We provide full documentary support of the registration procedure, including drafting, legal review, and filing of all necessary constituent and other supporting documents with the relevant registration authorities.

We are authorised to represent the client's interests in communications with AIFC regulatory authorities at all stages of registration and licensing. Upon completion of registration activities, we can provide post-registration support, including assistance in opening corporate bank accounts, accounting support in MFCA Kazakhstan, and ensuring that the client's operations comply with local legislation and AIFC regulations.