Kazakhstan will apply three types of bankruptcy proceedings for individuals, taking into account international experience. These are out-of-court and in-court restructuring, and also solvency restoration procedure. That was announced by Finance Minister Yerulan Zhamaubayev, while introducing the relevant draft law, which was approved by the Lower House of the Kazakh Parliament in the first reading. According to him, the first procedure will be applied to debts to second-tier banks, microfinance organizations and collectors, if it does not exceed 4.9 million tenge. In this case, the debtor must have no property and statutory income, or his or her earnings should be below the subsistence minimum. Bankruptcy court proceedings shall be opened in case the debt exceeds this amount. However, their property may be put up for an auction sale. The solvency restoration procedure provides the possibility of obtaining court-ordered installment payments of debts up to 5 years if the debtor has regular income.
“Banks should primarily make efforts to lend to the economy. Microfinance organizations should focus on lending to small and micro businesses rather than driving people into debt and confiscating their property. As spelled out in the law, if the debtor has only one mortgaged housing, then the lender has the right to take it during the bankruptcy proceeding. If the property is not mortgaged, the lender cannot seize it,” Zhamaubayev said.
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