As part of another meeting of the joint “Business and Taxes” project, experts from the Department of State Revenues in East Kazakhstan Region and the Chamber of Entrepreneurs discussed one of the most sensitive issues for the business community—bankruptcy of legal entities—in a live broadcast.
Participants were reminded of the basic legal provisions: bankruptcy is a debtor’s insolvency recognized by a court, which serves as grounds for its liquidation. In Kazakhstan, this procedure is regulated by the Law “On Rehabilitation and Bankruptcy.”
As Sairan Ualibekova, Head of the Department for Work with Insolvent Debtors of the Department of State Revenues in East Kazakhstan Region, explained, the main purpose of the procedure is to satisfy creditors’ claims to the greatest extent possible using the debtor’s assets.
She paid particular attention to the signs of persistent insolvency.
“This refers to a situation in which a company’s liabilities exceed the value of its assets both at the time the application is filed with the court and at the beginning of the relevant financial period,” Sairan Ualibekova explained.
The grounds for applying to the court were also discussed. The procedure may be initiated either by the debtor itself or by creditors. It is important to note that bankruptcy proceedings are subject to specific deadlines and are conducted under the supervision of an appointed administrator.
The experts also emphasized that the law provides for liability not only for fictitious bankruptcy but also for deliberate bankruptcy. The latter refers to intentional actions aimed at avoiding the fulfillment of obligations to creditors, including the withdrawal of assets, entering into deliberately unfavorable transactions, or concealing property.
If such facts are established, controlling persons may be held subsidiarily liable—that is, required to repay the company’s debts using their personal funds. This liability may also arise after the bankruptcy proceedings have been completed.
Summing up the meeting, Aizhan Zhangirkhanova, Deputy Head for Legal Affairs of the Chamber of Entrepreneurs of East Kazakhstan Region, emphasized that timely analysis of a business’s financial condition, compliance with legal requirements, and transparency in handling documents help reduce risks and avoid adverse consequences.