Redomicilation of the company in the AIFC

Redomicilation of the company in the AIFC

1. Introduction

Company redomiciling is the process by which a company changes its legal registration from one country to another. This is not just a change of the address of the head office or the opening of a new branch abroad, but a complete transfer of legal registration, which affects the legal position of the company.

The process of business migration to AIFC includes several important aspects:

  • Change of jurisdiction: when redomiciling, the company transfers its legal registration from the country of result to the country of destination.

  • Business Process Support: An important characteristic of redomiciling is that the company continues its operations without interruption. IN the process of redomicilation in the AIFC The company maintains its operational activity and avoids the liquidation procedure of the country of initial registration. This means that all assets, contracts, liabilities and corporate structure remain the same, but are now subject to the laws of the new jurisdiction.

  • Legal consent: redomicilation is possible only if the legislation of both countries (country of result and country of destination) allows such relocation. Some countries may have restrictions or bans on redomiciling, while others may offer simplified procedures for foreign companies to engage.

Redomiciling can be motivated by various reasons, including tax advantages, the desire for a more stable and favorable business environment, access to new markets, political stability and improved legal protection. However, it is a complex and multi-step process that requires careful planning and compliance with numerous legal and regulatory requirements.

2. Advantages of transferring business to the International Financial Center of Astana

Simplification of redomicilation

The process of transferring business to AIFC is optimized to ensure speed and efficiency, which facilitates the relocation of companies and their further management.

Improved conditions for international recruitment

The center offers flexible conditions for attracting foreign specialists, including simplified visa procedures, which is a key aspect for global companies.

Access to international markets

The relocation of the company to the center of Astana opens up new opportunities for international business, expanding the geographical presence of companies.

Effect of UK law

Astana International Center combines the legal elements of Great Britain and Kazakhstan. This is achieved through the Constitutional Law of the Republic of Kazakhstan on the AIFC, which contains provisions based on the principles of English law.

Favorable tax environment

The Astana Center provides companies with the opportunity to reduce tax burdens, including reduced income tax rates and elimination of taxes on dividends, which contributes to increased tax efficiency.

Legal reliability

The Astana Center guarantees enhanced legal protection, using the principles of English law, which helps reduce legal risks.

Optimization of business operations

AIFC provides unique opportunities to optimize business processes, including improved corporate governance and more efficient allocation of resources.

Technological assistance

The international center supports innovation and technology initiatives by offering advanced infrastructure and technology solutions for business.

These advantages are very attractive for those wishing to redomicilize their business in the AIFC.

3. Aspects of the legal system of Great Britain in the AIFC

This special economic zone of Astana combines the legal elements of Great Britain and Kazakhstan. This is based on the Constitutional Law of the Republic of Kazakhstan on the AIFC, which includes provisions based on English law and complements Kazakhstani legislation where it does not conflict with the provisions of the Center. Such a legal structure significantly contributes to the economic development of the region.

The Court of the International Financial Center has exclusive powers to consider and resolve disputes between the participants of the Center, its bodies and their foreign employees. It is also authorized to resolve disputes related to operations carried out within the framework of the AIFC and which are subject to the law of the AIFC, as well as disputes that are referred to the court of the AIFC by mutual agreement of the parties. It is important to note that the AIFC court does not consider criminal and administrative cases.

Today, AIFC is a place of activity of international financial institutions, including the World Bank and the Asian Development Bank.

4. The process of redomiciling in the AIFC

Stage

Description

Preliminary analysis

It is necessary to check whether this procedure is allowed in the original jurisdiction and whether the company itself is ready for it.

Application for redomicilation

It is necessary to submit an application for business migration to the AIFC authorities, accompanied by all necessary documents, including financial reports.

Verification and approval of the application

The application is analyzed by the AIFC regulator with verification of financial documentation and compliance with legislation.

Legal registration

After approval, it is necessary to update the founding documents and other legal acts in accordance with the laws of Kazakhstan.

Official registration

The final stage includes registering the company in the AIFC and obtaining all necessary licenses and permits.

This process reflects some complexity and multi-stage transition of the company to the AIFC, which requires careful planning and compliance with numerous legal and regulatory requirements.

5. Submission of reports for the transfer of the company to the IFSC

Regulation and supervision

The AFSA agency in the AIFC provides regulation and supervision with a focus on risk management. This includes the analysis of macroeconomic data and a risk-based approach to the classification of companies. The main methods of supervision include inspections, meetings, reviews and information gathering, as well as interaction with other regulators.

Business plan for AFSA

Those wishing to redomicilize a company in the AIFC must submit a business plan to AFSA. This plan serves to assess their compliance and suitability for licensing by reflecting strategies, financial projections and risk management plans.

Application criteria

The application for redomiciling includes audit reports, ownership structure, organizational chart, forecasts of financial activity and other documents to ensure transparency and compliance with AIFC standards.

6. Examples of company migration to the AIFC

Kazakhstan Energy Reinsurance Company Ltd (KERC)

Affiliated with JSC NC “KazMunayGas” and originally registered in Bermuda, successfully transferred its registration to AIFC in December 2019. The move marked the first example of a company moving its registration to the AIFC without liquidating its original jurisdiction. This transition emphasizes the strategic role of AIFC in regional economic development.

Polymetal International plc

Officially completed the redomicilation procedure from Jersey to AIFC in Kazakhstan on August 7, 2023. The process was completed with all necessary approvals and conditions met. After the redomicilation, Polymetal International plc continues to be registered on the Astana International Exchange, which has become its main stock exchange. This transition also contributes to the economic development of the region through the MFC.

7. Conclusions

Moving the company’s registration to the Astana International Financial Center is a significant step for businesses that wish to expand their presence and strengthen their international image. AIFC attracts companies with its unique legal system based on English law and tax preferences, creating favorable conditions for organizations of different sizes and areas of activity. Successful examples of redomiciling, including international financial and mining companies, highlight the growing interest and confidence in the AIFC.

It is important to be aware that the process of transferring a business to the Astana EEZ requires extensive preparation, including legal and financial assessment, compliance with procedural steps, and compliance with regulatory requirements. Successful redomiciling not only opens up access to new markets and provides improved legal protection, but also contributes to strengthening the company’s international prestige and expanding its business prospects.

In general, AIFC plays a central role in determining new directions for of business development in Kazakhstan and beyond, providing unique opportunities for optimization and growth at the international level, significantly contributing to the economic development of the region.

If you are interested in receiving comprehensive information regarding the migration procedure of your company to the Astana International Financial Center, please contact us. We are ready to provide you with the necessary support and advice. From the initial stage of planning and preparation to the successful completion of the relocation, our team will accompany you, ensuring that each stage is completed efficiently and according to the requirements. To start a dialogue and learn more about how we can help your business, use the feedback form on our website.

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