How to Register a Business in Kazakhstan?

Kazakhstan is an emerging hotspot for entrepreneurs worldwide, offering a rapidly growing economy in Central Asia. Historically, it was part of the Silk Road, a trade route that connected China to Europe for over 1,500 years. Today, Kazakhstan provides modern, tech-driven opportunities for businesses.

As the largest economy in Central Asia, Kazakhstan has developed a thriving business environment. The introduction of Astana Hub International Technology Park has positioned the country as a rising tech hub. Additionally, Kazakhstan is rich in natural resources, including oil, natural gas, coal, minerals, and iron ore. The country also has significant agricultural potential, particularly in grain and livestock production.

Over the years, Kazakhstan has transformed its business environment, making it attractive to both local and foreign entrepreneurs. With economic stability, a strategic location, and investor-friendly policies, it offers immense potential for those looking to start a business.

Why Choose Kazakhstan to Start your Business?

Well, over the years Kazakhstan has actively reformed its business environment attracting entrepreneurs from both local and foreign nationals. Below are the reasons for why you should choose Kazakhstan for your business set up:

1. High Ranking & Strategic Market Access

Kazakhstan ranks 25th in the World Bank’s Ease of Doing Business Index, making it one of the most business-friendly destinations globally. Additionally, its membership in the Eurasian Economic Union (EAEU) provides businesses with access to a market of over 180 million people across Russia, Belarus, Armenia, and Kyrgyzstan. These factors make Kazakhstan an attractive hub for both local and international entrepreneurs.

2. Strategic location & efficient business registration process

Kazakhstan, the second-largest republic of the former Soviet Union after Russia, is also the largest landlocked country in the world. Serving as a bridge between Europe and Asia, it shares borders with Russia, China, and several Central Asian countries, making it a strategic hub for trade and an attractive destination for business expansion.

The country offers a streamlined business registration process, low tax rates, and various government incentives, making it easier for entrepreneurs to establish and grow their businesses.

3. Business Friendly Policies and Foreign investment Support

The government of Kazakhstan has implemented several reforms to strengthen the country’s economy and attract foreign investors. One of the most notable initiatives is the “100 Concrete Steps” reform, introduced in 2015. This initiative aims to boost economic development by improving governance, diversifying the economy, and reducing bureaucracy, making Kazakhstan a more business-friendly destination.

4. Favorable Tax Systems

Kazakhstan offers a highly favorable tax system with competitive corporate tax rates, various tax exemptions, and incentives for foreign investors. Additionally, the country provides a streamlined and straightforward business registration process, making it easier for entrepreneurs to establish and grow their businesses.

Role of Astana International Financial Centre (AIFC)

The Astana International Financial Centre (AIFC), launched on July 5, 2018, is a major financial hub in Astana, Kazakhstan. It is recognized as a key financial institution in Central Asia and Eastern Europe, with the goal of developing Kazakhstan’s non-banking financial sector, attracting investments, and becoming a financial center for Central Asia, the Eurasian Economic Union, the Caucasus, Western China, Mongolia, and Eastern Europe.

AIFC provides a business-friendly environment that supports financial growth in the region. It promotes entrepreneurship and innovation through various programs such as incubation, acceleration, awards, and grants. Additionally, it removes restrictions on the number of international employees that companies can hire, making it easier for businesses to attract global talent.

The AIFC Court, based on English common law, offers an independent system for resolving civil and commercial disputes. The center also provides tax benefits for up to 50 years and a simplified visa and work permit process for foreign employees.

By fostering a pro-business environment, AIFC not only supports the expansion of existing companies but also encourages the establishment of new businesses, strengthening entrepreneurship and innovation in the region.

List of key Industries and Economic growth In Kazakhstan

Besides its rich reserves of oil, gas, uranium, and minerals, the government of Kazakhstan is actively promoting the growth of diverse high-potential sectors, including:

1. Technology and IT Startups

The government of Kazakhstan has launched initiatives like Astana Hub, a leading IT park that offers tax exemptions and grants to tech companies. As a result, IT exports have grown significantly, reaching $529 million in 2023 and surpassing $305 million in the first half of 2024.

2. E-commerce and Fintech

With the rise of global digitalization, Kazakhstan is keeping pace, experiencing rapid growth in online shopping and digital banking services over time.

3. Renewable Energy

The government of Kazakhstan is making significant investments in solar, wind, and hydroelectric projects, demonstrating its strong commitment to sustainability.

4. Agriculture and Food Production

Agriculture plays a vital role in Kazakhstan’s economic, social, and environmental development. The country is the largest grain producer in Central Asia and a major exporter in the region.

What are the Types of Business Entities in Kazakhstan?

Some of the most common types of business entities in Kazakhstan are as follows:

1. Limited Liability Partnership (LLP)

Limited liability partnership (LLP) is the most common type of business structure mostly for small and medium-sized businesses. It provides the owners with a limited liability protection.

2. Joint Stock Company (JSC)

Joint Stock Company unlike LLP is most be preferable for larger enterprises who are planning to raise a capital through public or private share issuance.

3. Sole Proprietorship

A sole proprietorship is a simple form of business owned by individuals, often used by freelancers and small traders.

4. Branch Office

A branch office is a business structure that allows foreign entrepreneurs or companies to operate in Kazakhstan without requiring local business registration.

Procedure for Business Registration in Kazakhstan

The step-by-step procedure for business registration in Kazakhstan is as follows:

1. Selection of Business Name

Firstly, the applicant needs to select or choose a unique business name and get the same approved by the Ministry of Justice.

2. Preparation of Documents

In this stage, the applicant shall prepare all the necessary documents required for the company registration, including shareholder agreements, passport copies and various other business details.

3. Register with the National Chamber of Entrepreneurs

Followed by submitting the application form along with the necessary documents to the National Chamber of Entrepreneurs. 

4. Obtain Business Identification Number (BIN)

After obtaining business registration, entities must obtain a business identification number (BIN) for day-to-day financial transactions and tax registrations.

5. Open a Corporate Bank Account

Next it is mandatory to open a corporate bank account for managing business transactions.

6. Register for Taxation and VAT (if applicable)

Businesses in Kazakhstan must also register for VAT (value-added tax) in case the earnings of the businesses meet a certain threshold limit.

How much time is taken for Business Registration in Kazakhstan?

Setting up a business in Kazakhstan is relatively simple. The registration process typically takes around 5 to 7 days, depending on the business structure and required documentation.

What are the Licensing and Regulatory Requirements?

Business registered in Kazakhstan needs to obtain various licenses and comply with regulatory requirements depending upon the type of business they are operating. These licenses are regulated under the various departments of the Kazakhstan government as given below:

1. Financial Services & Fintech

It is regulated by the National Bank of Kazakhstan.

2. Oil, Gas and Mining

Businesses related to oil, gas, and mining must obtain approval from the Ministry of Energy.

3. Food and Pharmaceuticals

This type of business must be regulated and comply with the Ministry of Health.

4. Construction and Real Estate

For businesses related to construction and real estate permission is to be taken from the municipal authorities.

Additionally, companies operating in Kazakhstan must comply with labour laws, environmental regulations, and intellectual property rights to avoid potential legal penalties or complications.

Taxation and Financial Benefits for Business in Kazakhstan

The taxation system in Kazakhstan offers a competitive tax structure making it one of the attractive business destinations across the globe.  Here, the corporate tax rate is 20%, while small businesses can qualify for a lower tax regime. Meanwhile, personal tax is set at a flat 10% and value-added Tax (VAT) stands at 12%.

Additionally, the government of Kazakhstan has also established 13 Special Economic Zones (SEZs) facilitating businesses with significant tax incentives; this includes:

1. Zero corporate tax for up to 10 years
2. Exemption from customs duties on imports
3. Simplified visa and work permit process for foreign employees

Some of the most popular SEZs are Astana Hub (for IT startups), Khorgos-Eastern Gate (for logistics and trade), and Pavlodar SEZ (for manufacturing and industrial businesses)

Challenges and Considerations -Business Set up in Kazakhstan

While setting up a business in Kazakhstan has many advantages, it also comes with certain challenges and considerations, including:

1. Language barrier

Language barriers can be a challenge, as Kazakh and Russian are the official languages, and English is not widely spoken in government offices. Entrepreneurs may need to hire professional translators to handle daily paperwork and negotiations.

2. Bureaucratic hurdles

In general, the business registration in Kazakhstan is straightforward, but depending upon the business structure especially banking and energy has to go through a strict regulatory framework. Therefore, it is recommended to have legal assistance to streamline the process.

3.  Currency Volatility

In recent years, the Kazakhstani Tenge (KZT) has experienced fluctuations in value, posing risks for businesses involved in foreign exchange. Companies handling international transactions should implement effective currency risk management strategies.

Conclusion

Kazakhstan presents a promising environment for entrepreneurs, offering strategic market access, investor-friendly policies, and a well-developed infrastructure. With its growing economy, abundant natural resources, and initiatives like the Astana International Financial Centre (AIFC) and Astana Hub, the country is evolving into a business hub in Central Asia.

However, challenges such as language barriers, regulatory complexities, and currency fluctuations require careful planning and professional support. By leveraging Kazakhstan’s favourable tax system, government incentives, and emerging industries, businesses can tap into a wealth of opportunities and achieve long-term success.

To get expert assistance in company registration in Kazakhstan and compliance management, visit www.enterworld.io.

Frequently Asked Questions Abouth Business in Kazakhstan