KZT1.5 bn. is provided in the budget-2006 for foundation of a regional financial center in Almaty - vice-ministry of economy

/INTERFAX-KAZAKHSTAN, Астана, January 17, 06/ - 1.5 bn. tenge in the budget-2006 are meant for foundation of a regional financial center in Almaty (current 133.51/$1), Batyrkhan Isayev vice-minister of economy and budget planning said. Isayev says RFCA's activity will be regulated by a new agency, which is to be given governmental functions. He says this structure will not be in the staff of the government, and its head will be appointed by the state's head. The regulating body of RFCA will be given functions of several ministries, including functions on state registration of juridical persons, tax and labor control, visa support and other. It's planned to found RFCA in the form of a special zone with a special legal regime. Unlike the existing at present special economic zones RFCA will not have an exact territory. Territoriality principle will be followed by the requirement for RFCA participants about presence of the office in Almaty city. For increasing the status and reliability of RFCA there will be the constantly functioning International consultation council, where international financiers with a good experience on international financial markets will work. Kayrat Kelimbetov Minister of economy said only broker and dealer organizations will pass registration in RFCA. "It's planned to unite registration as a juridical person and registration as a RFCA participant, having given the right of registration to RFCA. Legal capacity of RFCA's participants will be limited only by the right to make deals on the special trade floor of RFCA", - the minister said. It's planned to make tax control of RFCA participants only based on tax statement, confirmed by auditor's report. Besides, it's planned that foreign citizens and persons without citizenship, coming to Kazakhstan for making business in RFCA, will receive entrance visa at coming to the international airport of Almaty city. Prolonging of visa validity period, as well as changing of visa categories can be made by RFCA's executive body without this person's leaving the country. It's planned that RFCA participants will have the possibility to execute paper work and make deals only in English, normative decisions of the executive body will also be translated into English. It's planned that main groups of players in RFCA, besides broker-dealer companies, will consist of issuers, investors and market-makers. It's planned that the list of potential issuers will comprise Kazakhstan big and medium companies, medium companies from Russia, Ukraine and Central- Asian region, Kazakhstan banks, RFCA brokers on index funds and other securities, as well as other foreign issuers. It's expected that investors in RFCA, will be Kazakhstan pension funds, unit funds, insurance organizations, Kazakhstan banks and companies, Russian and other regional banks, other big and medium investors, foreign investors, Islamic investors. As regards economic incentives and tax benefits the Ministry of economy offered full release from tax treatment on corporate income tax (CIT) for registered RFCA participants. Besides, partial compensation of expenses for audit depending on volumes of issue, discounts for listing up to zero cost of listing in the first year of RFCA's functioning, as well as release from registration fee in RFCA are planned. Kelimbetov says the presumed model of the financial center comprise all the best from international practice of such centers foundation. At present central offices of almost all big commercial banks of the republic, National Bank, Kazakhstanс stock exchange, and other financial institutions of the country a re situated in Almaty. [2006-01-17]