INTERMEDIARY ACTIVITY OPERATION
The following amendments and additions to the Law of the Republic of Kazakhstan "On Insurance Activities" (hereinafter referred to as "the Law") were introduced by the Law of the Republic of Kazakhstan No. 166-VI as of July 2, 2018 "On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Insurance and Insurance Activities, Securities Market" to be enacted as of July 15, 2018.
- In sub-clause 1 of clause 1 of Article 18-2 of the Law of the Republic of Kazakhstan "On Insurance Activities" (hereinafter referred to as the Law), amendments were made, according to which the insurance agent, being an individual, has the right to carry out intermediary activity on behalf of one life insurance organization, and (or) one general insurance organization, subject to the restrictions provided for in clauses 18 and 18-1 of this Law.
Thus, starting the date of implementation of the aforementioned amendments to the Law, being our insurance agent, you are deprived of the right to provide similar services to another insurance organization that carries out activities in life insurance.
In the event that, in addition to our Company, you are also an insurance agent in a similar insurance organization, in order to comply with the above law requirements, we kindly ask you to take the decision on continuation/termination of the agency contract signed between us earlier.
The absence of written notice of termination of the agency agreement signed between us will be the cause to extend its terms and absence of grounds for violation of the requirements of sub-clause 1 of clause 1 of Article 18-2 of the Law.
OBLIGATION TO PAY COMPULSORY PENSION CONTRIBUTIONS
Besides, the Law of the Republic of Kazakhstan No. 165-VI ZRK as of July 2, 2018 "On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Social Security" in Part 1 of Sub-clause 4 of Article 25 of the Law of the Republic of Kazakhstan "On Pensions in the Republic of Kazakhstan" (hereinafter referred to as the Pension Law on Pension Security) was amended, which is effective from 14.07.2018, according to which "For attorneys, private court bailiffs, private notaries, professional mediators, individual entrepreneurs, as well as individuals receiving income on contracts of civil law nature, compulsory pension contributions to their own benefit that are payable in a single accumulative pension fund, calculated for each month, are set at 10 percent of the income received, but not less than 10 percent of the minimum wage and not more than 10 percent 75-fold minimum wage established for the relevant fiscal year by the law on the republican budget".
Considering that the agency contract signed by us is of a civil legal nature, hereby the Company informs you that the Law on Pension Security entrusts you with the obligations of an agent for the payment of mandatory pension contributions, namely the calculation, withholding (charging) and transferring mandatory pension contributions in their favor in a single accumulative pension fund in the manner determined by the legislation of the Republic of Kazakhstan and the obligations arising from this requirement for the provision of information on the listed mandatory pension contributions to the tax authorities in the declaration on individual income tax and social tax in the form approved by Order No. 166 of the Minister of Finance of the Republic of Kazakhstan dated February 12, 2018 (Appendix 14).
In addition, we inform you that responsibility for failure to fulfill or improper fulfillment of the above requirements established by the Law on pension security by clauses 6.7 of Article 91 of the Code of the Republic of Kazakhstan "On Administrative Offenses" has been established.
Taking into account the above amendments to the Law on Pension Security, please be advised that the Company is not legally obligated to calculate, withhold (charge) and transfer mandatory pension contributions to your benefit within the framework of the agreement signed between us. In order to avoid the application of sanctions by the authorized body in respect of you, we ask you to independently ensure the fulfillment of the above requirements of the legislation of the Republic of Kazakhstan.
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