ABOUT PROMISSORY NOTE CIRCULATION IN THE REPUBLIC OF KAZAKHSTAN

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The Law of the Republic of Kazakhstan dated April 28, 1997 N 97-1.

table of contents

This Law, in accordance with the Convention Establishing the Uniform Law on Bills of Exchange and Promissory Notes, the Convention aimed at Resolving Certain Conflicts of Laws on Bills of Exchange and Promissory Notes, and the Convention on Stamp Duty in Respect of Bills of Exchange and Promissory Notes of June 7, 1930, regulates promissory note circulation in the Republic of Kazakhstan and defines the functions of a promissory note as a payment instrument and means of crediting.

The concepts used in this Law

An aval is a promissory note guarantee in which the person who made it assumes the obligation to make payment on a promissory note (in whole or in part) for another person obligated by the promissory note.

An avalist is a person who has committed an aval.

Acceptance is a written consent to the payment of a bill of exchange.

Allonge is an additional sheet to a bill of exchange for making endorsements.

A bronze bill is a bill issued to a fictitious person.

Promissory note currency is the monetary unit in which the promissory note amount is expressed.

Drawee is a legal entity or individual who issued a bill of exchange.

The bill holder is the owner of the bill, who has the right to receive the amount of money specified in it.

A bill of exchange is a payment document of a strictly defined form containing a unilateral unconditional monetary obligation.

Promissory note paper is a type of stamped paper that has a certain degree of protection and is intended for drawing up promissory notes on it.

Grace day is a grace day on which the payment period indicated on the bill is extended.

Discount is the percentage charged when accounting for promissory notes before the due date.

Domiciled promissory note is a promissory note payable by a third party in a place other than the payer's place of residence, on behalf of and at the expense of the payer, with the designation of this on the promissory note itself.

Friendly bills are bills issued by persons to each other without the intention of the drawee to make a payment on it, but only for the purpose of finding money through mutual accounting of these bills in a second-tier bank.

An endorsement is a transfer inscription on the back of a bill of exchange or on an allenge certifying the assignment of rights under this bill to another person.

Endorser - the person transferring the bill.

Endorser - the person in whose favor the bill of exchange is transferred according to the transfer inscription.

Commercial promissory note is a promissory note issued on the basis of purchase and sale agreements, works, and services (with the exception of financial services).

Courtage is remuneration paid to an intermediary when making a transaction with a bill of exchange.

Place of residence - the place of residence of an individual (postal address) or the location of a legal entity (postal address).

"Not by order" is a formula included in a bill of exchange by the drawee, meaning a prohibition to transfer the bill by means of an endorsement.

"Turnover without costs", "without protest" - a clause included in the text of a bill of exchange by the holder, endorser, avalist, exempting the holder from protesting the bill of exchange in non-payment or non-acceptance by the drawee.

Persons obligated by a bill of exchange are those persons to whom a demand may be made to pay a bill of exchange: the drawee, the endorser, the payer, the acceptor, the avalist.

A bill of exchange (bill of exchange) is a bill of exchange containing an unconditional offer (order) from the drawee (tracer) to a third person (tracer) to pay the first drawee (remitter) either by his order at a certain time in the future, or upon presentation of the amount of money indicated in the bill.

A transfer endorsement is an inscription on a bill of exchange made by the holder of the bill of exchange and intended to transfer certain rights under the bill within the limits established by the endorser.

A promissory note (solo) is a bill of exchange containing an unconditional obligation of the drawee to pay, on demand or at a certain time in the future, the amount of money indicated in the bill to the holder.

A bill of exchange protest is a written act certifying the undating of acceptance or the refusal of acceptance or payment.

Regression is a reverse claim for an unrecognized or unpaid bill.

A recambio is a claim that can be issued in the form of a bill of exchange (reverse expenditure), presented by the person who paid the bill to one of the persons obligated by the bill. The recambio may include the amount of the bill paid, interest, penalty, and costs associated with the protest.

A remess is a bill of exchange in a foreign currency purchased by a debtor for the national currency from a third party and sent by him to his foreign creditor to repay the debt owed to him.

An accounting office is a second-tier bank (hereinafter referred to as the bank) licensed to perform accounting operations.

A financial bill is a bill issued for the purpose of raising money, as well as on the basis of financial services transactions.

Assignment is the assignment of a claim in an obligation in accordance with civil law.

The footnote. Concepts as amended by the Laws of the Republic of Kazakhstan dated 24.12.2001 N 276; dated 09.07.2003 N 482; dated 02.07.2018 No. 168-VI (effective after ten calendar days from the date of its first official publication).

Section I ON BILLS OF EXCHANGE AND PROMISSORY NOTES Chapter 1. On THE PREPARATION AND FORM OF BILLS OF EXCHANGE

Article 1

A bill of exchange must contain:

1) the name "promissory note", included in the text of the document itself and expressed in the language in which this document was drawn up;

2) an unconditional order to pay a certain amount of money;

3) the name of the person who has to pay (the payer);

4) specifying the payment term;

5) an indication of the place where the payment is to be made;

6) the name of the person to whom or on whose order the payment is to be made;

7) indication of the date and place of drawing up the bill of exchange;

8) the signature of the person who issues the bill (the drawee).

Article 2

A document that does not contain any of the requirements specified in the preceding article does not have the force of a bill of exchange, except in the cases specified in the following paragraphs.

A bill of exchange for which the due date is not specified is considered payable upon presentation.

In the absence of a special indication, the place indicated next to the payer's name is considered to be the place of payment and, at the same time, the payer's place of residence.

A bill of exchange that does not specify the place where it was drawn up is recognized as signed in the place indicated next to the name of the drawee.

Article 3

A bill of exchange may be issued as payable by order of the drawee.

It can be issued to the drawee himself.

It can be issued at the expense of a third party.

Article 4

A bill of exchange may be payable at the place of residence of a third party, or at the same place where the payer's place of residence is located, or at some other place.

Article 5

In a bill of exchange, which is due upon presentation or at a certain time after presentation, the drawee may stipulate that interest will accrue on the amount of the bill. In any other bill of exchange, such a condition is considered unwritten.

The interest rate must be indicated on the bill; in the absence of such indication, the condition is considered unwritten.

Interest is accrued from the date of the bill of exchange, unless another date is specified.

Article 6

If the amount of the bill of exchange is indicated in both words and figures, then in case of disagreement between these designations, the bill is valid for the amount indicated in words.

If the amount is indicated several times in a bill of exchange, either in words or figures, then in case of disagreement between these designations, the bill is valid only for a smaller amount.

Article 7

If a bill of exchange contains signatures of persons who are unable to be bound by the bill of exchange, forged signatures or signatures of fictitious persons, or signatures that for any other reason cannot bind those persons who supplied them or on whose behalf it is signed, then the signatures of other persons still do not lose their validity.

A missing signature on a bill of exchange can be filled in provided that an officially certified statement written on the bill of exchange certifies the will of the person who was supposed to sign it.

Article 8

Anyone who signed a bill of exchange as a representative of a person on whose behalf he was not authorized to act is obligated as a party to the bill and, if he has paid, has the same rights that someone who was listed as represented would have. A representative who has exceeded his authority is in the same position.

Article 9

The drawee is responsible for both acceptance and payment.

He may relinquish responsibility for the acceptance; any condition under which he relinquishes responsibility for the payment is considered unwritten.

Chapter 2. ABOUT THE ENDORSEMENT

Article 10

Any bill of exchange, even if it is issued without an indication of the order, may be transferred by means of an endorsement.

If the drawee has placed the words "not by order" or any equivalent expression in the bill of exchange, then the document can only be transferred in accordance with the form and with the consequences of an ordinary assignment.

An endorsement may even be made in favor of the payer, regardless of whether he accepted the bill or not, either in favor of the drawee or in favor of any other person obligated by the bill. These persons may, in turn, endorse the bill.

Article 11

The endorsement should be simple and unconditional. Any condition limiting it is considered unwritten.

A partial endorsement is invalid.

A bearer's endorsement has the force of a blank endorsement.

Article 12

The endorsement must be written on a bill of exchange or on a sheet attached to it (allong). It must be signed by the endorser.

The endorsement may not contain an indication of the person in whose favor it was made, or it may consist of a single signature of the endorser (blank endorsement). In this latter case, the endorsement must be written on the back of the bill of exchange or on the allong in order to be valid. <*>

The footnote. Article 12 as amended by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 13

The endorsement transfers all rights arising from the bill of exchange. If the endorsement is blank, the bill holder may:

1) fill out the form either with your own name or with the name of some other person;

2) in turn, to endorse a bill of exchange by means of a letterhead or in the name of some other person;

3) transfer the bill to a third party, without filling out the form and without making an endorsement.

Article 14

The endorser is responsible for acceptance and for payment, if there is no other condition.

He may prohibit further endorsement; in this case, he is not responsible to those persons in whose favor the bill was subsequently endorsed.

Article 15

The person who holds the bill of exchange is considered to be the legal holder of the bill if he bases his right on a continuous series of endorsements, even if the last endorsement is a blank one. Crossed-out endorsements are considered unwritten. When a blank endorsement is followed by another endorsement, the person who signed the last one is considered to have acquired the bill of exchange according to the blank endorsement.

If someone has lost possession of a bill of exchange due to any event, the person who holds the bill of exchange and who justifies his right in accordance with the procedure specified in the previous paragraph is obliged to give the bill of exchange only if he acquired it in bad faith or committed gross negligence in acquiring it.

Article 16

Persons who are sued for a bill of exchange may not object to the holder of the bill based on their personal relationship to the transferee or to previous holders of the bill, unless the holder, when acquiring the bill, acted knowingly to the detriment of the debtor.

Article 17

If the endorsement contains a clause "currency to be received", "for collection", "as a trustee" or any other clause referring to a simple assignment, the holder of the bill of exchange may exercise all rights arising from the bill of exchange, but he can endorse it only by way of assignment.

In such a case, obligated persons may raise only such objections against the holder of the promissory note as could be opposed by the endorser.

The assignment, which is contained in the transfer endorsement, does not terminate due to the death of the delegate or the onset of his incapacity.

Article 18

If the endorsement contains the clause "currency as security", "currency as collateral" or any other clause referring to the pledge, the holder of the bill may exercise all rights arising from the bill of exchange, but the endorsement provided by him is valid only as a proxy endorsement.

Obligated persons may not raise objections against the promissory note holder based on their personal relationship to the endorser, unless the promissory note holder, when receiving the promissory note, acted knowingly to the detriment of the debtor.

Article 19

An endorsement made after the due date has the same effect as the previous endorsement. However, an endorsement made after a protest of non-payment or after the expiration of the deadline set for making a protest has the effect of an ordinary assignment only.

Since the contrary will not be proven, an undated endorsement is considered completed before the expiration of the deadline set for making a protest.

Chapter 3. ON ACCEPTANCE

Article 20

A bill of exchange may, before the due date, be presented by the holder of the bill or even simply by the person who holds the bill for acceptance to the payer at his place of residence.

Article 21

In any bill of exchange, the drawee may stipulate that the bill must be presented for acceptance with or without a deadline.

He may prohibit a bill of exchange from being presented for acceptance, unless it is a bill of exchange that is payable from a third party, or a bill that is payable in a place other than the payer's place of residence, or a bill that is due after a certain time upon presentation.

It may also stipulate that the submission for acceptance cannot take place earlier than the scheduled time.

Each endorser may stipulate that a bill of exchange must be presented for acceptance with or without a deadline, unless the bill is declared non-acceptable by the drawee.

Article 22

Bills of exchange payable at a certain time after presentation must be submitted for acceptance within one year from the date of their issuance.

The drawee may shorten this deadline or impose a longer deadline.

These terms can be shortened by endorsers.

Article 23

The payer may request that the bill be presented to him again on the day following the first presentation.

Interested parties may refer to the fact that this requirement has not been fulfilled only if this requirement has been mentioned in the protest.

The holder of the bill of exchange is not obliged to transfer the bill presented for acceptance to the payer.

Article 24

The acceptance is marked on the bill of exchange. It is expressed by the word "accepted" or any other equivalent word; it is signed by the payer. A simple signature of the payer, made on the front of the bill, has the force of acceptance.

If a bill of exchange is due at a certain time from presentation, or if it must be presented for acceptance at a certain time due to a special condition, the acceptance must be dated on the day on which it was given, unless the holder requires it to be dated on the day of presentation. In the absence of a date, the holder of the bill of exchange, in order to preserve his rights of recourse against the endorsers and against the drawee, must certify this omission by timely protest.

Article 25

The acceptance should be simple and unconditional, but the payer may limit it to a portion of the amount.

Any other change made by acceptance in the contents of a bill of exchange is equivalent to a refusal of acceptance. However, the acceptor responds according to the content of his acceptance.

Article 26

If the drawee has indicated in the bill of exchange a place of payment other than the payer's place of residence, without specifying the third party from whom the payment is to be made, the payer may indicate such person upon acceptance. In the absence of such an indication, it is assumed that the acceptor has undertaken to make the payment himself at the place of payment.

If the bill is due to be paid at the payer's place of residence, the latter may indicate in the acceptance any address in the same place where the payment is to be made.

Article 27

The payer undertakes to pay the bill of exchange on time by acceptance.

In case of non-payment, the holder of the bill of exchange, even if he is the drawee, has a direct claim against the acceptor based on the bill of exchange in respect of everything that can be claimed in accordance with articles 47 and 48.

Article 28

If the payer who put an inscription on the bill of exchange stating his acceptance crossed it out before returning the bill, it is considered that the acceptance was refused. Since nothing else will be proven, it is assumed that the strikethrough was made before the document was returned.

However, if the payer has notified the bill holder or any of the signatories in writing of his acceptance, then he is obligated to them in accordance with the terms of his acceptance.

Chapter 4. ABOUT AVALA

Article 29

Payment on a bill of exchange can be secured in full or in part of the bill amount by means of an advance payment.

This security is provided by a third party or even by one of the signatories of the bill.

Article 30

The aval is given on a bill of exchange or on an additional sheet. The aval may be given by a separate act indicating the place where it was given.

It is expressed by the words "count for aval" or any other equivalent formula; it is signed by the one who gives the aval.

For an aval, only the signature affixed by the avalist on the front of the bill of exchange is sufficient, unless this signature is affixed by the payer or the drawee.

The avala should indicate at whose expense it is given. In the absence of such an indication, it is considered to be given for the drawee.

Article 31

The Avalist is responsible in the same way as the one for whom he gave the aval.

His obligation is valid even if the obligation he has guaranteed turns out to be invalid for any reason other than a defect in form.

By paying a bill of exchange, the avalist acquires the rights arising from the bill of exchange against the one for whom he has given a guarantee, and against those who, by virtue of the bill of exchange, are obligated to the latter.

Chapter 5. ABOUT THE PAYMENT DEADLINE

Article 32

A bill of exchange may be issued to those who are to be paid:

upon presentation;

at a certain time after the presentation;

at a certain time after the compilation;

on a certain day.

Bills of exchange containing either a different date or consecutive payment dates are invalid.

Article 33

A bill of exchange due upon presentation is paid upon its presentation. It must be presented for payment within one year from the date of its compilation. The drawee may shorten this period or stipulate a longer period. These terms can be shortened by endorsers.

The drawee may establish that a bill of exchange due upon presentation cannot be presented for payment before a certain date. In this case, the time limit for presentation runs from this time.

Article 34

The due date for a bill of exchange, drawn up at a certain time after presentation, is determined either by the date of acceptance or the date of protest.

In the absence of a protest, an undated acceptance is considered to have been made in respect of the acceptor on the last day of the deadline provided for submission for acceptance.

Article 35

The due date for a bill of exchange issued for a period of one or more months from its compilation or presentation occurs on the corresponding day of the month in which the payment is to be made. If there is no corresponding day in a given month, the payment deadline is on the last day of that month.

If a bill of exchange is issued for a period of one and a half months or several months and a half from the date of drawing up or presentation, then the whole months must first be counted.

If the payment deadline is set for the beginning, middle (mid-January, mid-February, etc.) or the end of the month, then these expressions are understood as the first, fifteenth or last day of the month.

The expression "eight days" or "fifteen days" does not mean one or two weeks, but a period of a full eight or fifteen days.

The expression "half a month" means a period of fifteen days.

Article 36

If a bill of exchange is due to be paid on a certain day in a place where a calendar is adopted other than at the place of issue, then the due date is considered to be set according to the calendar of the place of payment.

If different calendars are in effect at the place of issue and at the place of payment for a bill of exchange issued at a certain time after its compilation, then the date corresponding to the date of issue is set according to the calendar of the place of payment and the payment period is determined depending on this.

The time limits for the presentation of bills of exchange are calculated according to the rules of the preceding paragraph.

These rules do not apply if any reservation made in the bill of exchange, or even just the content of the document indicates the intention to adopt other rules.

Chapter 6. About THE PAYMENT

Article 37

The holder of a bill of exchange for a period of a certain day or at a certain time after drawing up or from presentation must present the bill of exchange for payment either on the day when it is due to be paid, or on one of the two following business days. <*>

The footnote. Article 37 as amended by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 38

When paying for a bill of exchange, the payer may require that it be handed to him by the bill holder with a receipt for payment.

The bill holder cannot refuse to accept a partial payment.

In the case of a partial payment, the payer may require that a note of such payment be made on the promissory note and a receipt be issued to him.

Article 39

The holder of the bill of exchange may not be forced to accept payment on the bill of exchange before the due date.

The payer who pays before the due date does so at his own risk.

The one who pays on time is free from obligation, unless there was deception or gross negligence on his part. He is obliged to verify the correctness of a consecutive series of endorsements, but not the signatures of the endorsers.

Article 40

If the bill of exchange is issued in a currency that is not in circulation at the place of payment, its amount can be paid in the local currency at the exchange rate on the due date. If the debtor is overdue, the bill holder may, at his discretion, require that the amount of the bill of exchange be paid in the local currency at the exchange rate either on the due date or on the day of payment.

The exchange rate of the foreign currency is determined according to the customs in force at the place of payment. However, the drawee may stipulate that the amount to be paid will be calculated at the rate indicated in the bill.

If the amount of the bill of exchange is indicated in a currency that has the same name in the country of issue and in the country of payment, but a different exchange rate, it is assumed that the currency of the place of payment was meant.

Article 41

In case of failure to declare a bill of exchange for payment within the time period specified in article 37, each debtor has the right to deposit the amount of the bill in a deposit of a person specially authorized by law at the expense, risk and risk of the bill holder.

Chapter 7. CLAIM IN CASE OF NON-ACCEPTANCE OR NON-PAYMENT

Article 42

The holder of the promissory note may exercise his rights of recourse against the endorsers, the drawee and other obligated persons.:

when the payment deadline arrives:

if the payment has not been completed;

even before the due date:

1) if there has been a complete or partial refusal of acceptance;

2) in case the payer is declared bankrupt, regardless of whether he accepted the bill or not, in case of termination of payments, even if this circumstance was not established by the court, or in case of unsuccessful foreclosure on his property;

3) in case of recognition of the drawee as bankrupt on a bill that is not subject to acceptance.

The procedure for establishing by the court the fact of termination of payments by the payer, as well as the procedure for foreclosing on property, are established by Article 94 of this Law.

A recourse claim against the persons responsible for acceptance and payment of the promissory note may be filed no later than the due date for payment of the promissory note (for paragraphs 2 and 3 of this article).

Article 43

The refusal of acceptance or payment must be confirmed by an act certifying the fact of refusal (protest of non-acceptance or non-payment).

A protest may be replaced by a statement drawn up on the bill of exchange itself and signed by the payer, except in cases where the drawee in the text of the bill of exchange itself requires a protest through an official act. The mentioned statement must be made within the time limits set for protests and entered into the register in accordance with the current legislation of the Republic of Kazakhstan. In this case, the undated endorsement is assumed to have been delivered before the protest.

A protest of non-acceptance must be made within the time limits set for submission for acceptance. If, in the case provided for in the first paragraph of article 23, the first presentation took place on the last day of the time limit, the protest may still be made on the next day.

A protest against non-payment must be made either on the day when the bill of exchange is due, or on one of the next two business days.

A protest of non-acceptance exempts from presentation for payment and from a protest of non-payment.

In the event of termination of payments by the payer, regardless of whether he accepted the bill or not, or in the event of unsuccessful foreclosure on the payer's property, the holder of the bill may exercise his rights only after presenting the bill to the payer for payment and after making a protest.

If the payer is declared bankrupt, regardless of whether he has accepted the bill or not, as well as if the drawee is declared bankrupt on a bill that is not subject to acceptance, it is sufficient for the holder of the rights belonging to him to submit a court decision declaring him bankrupt.

Article 44

The holder of the bill of exchange must notify his endorser and the drawee of non-acceptance or non-payment within four working days following the day of protest or, in the case of the "turnover without costs" clause, the day of presentation. Each endorser must, within two business days following the day of receipt of the notification, inform his endorser of the notification he has received, indicating the names and addresses of those who sent the previous notifications, and so on, going back to the drawee. The above-mentioned periods run from the moment of receipt of the previous notification.

If, in accordance with the preceding paragraph, a notification is sent to someone who has signed a bill of exchange, then the same notification must be sent within the same period to the person who gave the aval for it.

If any of the endorsers did not provide their address or indicated it illegibly, it is sufficient that the notice be sent to the endorser who precedes it.

The person who has to send the notification can do it in any form, even by simply returning the bill of exchange.

He must prove that he sent the notification within the prescribed time limit. It will be considered that the deadline has been met if the letter containing the notification is sent by mail within the specified period.

Anyone who does not send a notification within the above-mentioned period does not lose his right; he is liable for damage that may occur due to his negligence, however, that the amount of damages to be reimbursed may not exceed the amount of the bill of exchange.

In the event of a protest about non-acceptance or non-payment, the notary is obliged to notify all persons obligated by the bill of exchange by sending them a written notice in accordance with the addresses available on the bill or requested from the persons who requested the protest. The costs of such notification are added to the costs of the protest.

Article 45

The transferor, endorser or avalist may, by means of a clause "turnover without costs", "without protest" or any other equivalent clause included in the document and signed, release the transferor from making a protest in non-acceptance or non-payment in order to exercise his right of recourse.

This clause does not exempt the holder of the bill of exchange from presenting the bill of exchange within the prescribed time, nor from sending a notice. The proof of non-compliance with deadlines lies with the one who refers to this circumstance in a dispute with the bill holder.

If the reservation is included by the drawee, then it is valid for all persons who signed the bill; if it is included by the endorser or the avalist, then it is valid only for himself.

If, despite the clause included by the drawee, the drawee makes a protest, then the costs of the protest are borne by him. If the reservation comes from the endorser or from the avalist, then the costs of the protest, if any, can be claimed from all persons who signed their signatures.

Article 46

All those who have issued, accepted, endorsed a bill of exchange or placed an aval on it are jointly and severally obligated to the holder of the bill.

The holder of the promissory note has the right to bring a claim against all these persons, individually and collectively, without being forced to follow the sequence in which they have committed themselves.

The same right belongs to everyone who signs a bill of exchange after he has paid it.

A claim brought against one of the obligees does not preclude the filing of claims against others, even if they have committed themselves after the original defendant.

Article 47

The holder of the promissory note may demand from the person to whom he is suing:

1) the amount of the bill of exchange, not accepted or unpaid, with interest, if they were conditional;

2) a fine of the promissory note amount in the amount of the base rate of the National Bank of the Republic of Kazakhstan on the day on which the promissory note was due;

3) the costs of the protest, the costs of sending the notification, as well as other costs.

In addition, the holder of the bill of exchange who filed the claim may include a commission in the amount of 0.01 percent of the bill amount in the amount of the claim.

If a claim is filed before the due date, an accounting percentage is deducted from the bill of exchange amount. This accounting percentage is calculated according to the official discount rate (bank rate) existing at the place of residence of the bill holder on the day of the claim.

The footnote. Article 47 as amended by the Law of the Republic of Kazakhstan dated 02.01.2021 No. 399-VI (effective from 01.01.2021).

Article 48

The person who has paid the bill of exchange may demand from the persons responsible to him:

1) the entire amount paid by him;

2) interest on the specified amount, calculated in the amount of the base rate of the National Bank of the Republic of Kazakhstan on the day on which the bill was paid by the plaintiff;

3) the costs incurred by him.

A person who has paid a bill of exchange and filed a claim against persons obligated by the bill of exchange may include a commission in the amount of the claim in the amount of 0.05 percent of the bill amount.

The footnote. Article 48 as amended by the Law of the Republic of Kazakhstan dated 02.01.2021 No. 399-VI (effective from 01.01.2021).

Article 49

Any obligated person who has been sued or may be sued may demand that a bill of exchange be handed over to him against payment, with a protest and a receipt for payment.

Each endorser who has paid a bill of exchange may cross out his own and the following endorsers' endorsements.

Article 50

In the case of recourse after partial acceptance, the person who pays the amount for which the bill was not accepted may require that this payment be marked on the bill and a receipt issued to him. The holder of the bill of exchange is obliged, moreover, to hand over to him a certified copy of the bill and an act of protest so that he can carry out subsequent recourse.

Article 51

Each person who has the right to file a claim may, unless otherwise agreed, receive payment by means of a new bill of exchange (reverse bill) issued on presentation to one of the persons responsible to him, with payment at the place of residence of this person.

The reverse expenditure includes, in addition to the amounts specified in articles 47 and 48, also the reverse expenditure fee.

If the reverse bill is issued by the holder of the bill, its amount is set at the exchange rate for bills of exchange due upon presentation, issued at the place of residence of the responsible person at the place of payment for the original bill. If the reverse bill is issued by the endorser, its amount is set at the exchange rate for bills of exchange due upon presentation, issued at the place of residence of the guaranteeing person at the place of residence of the drawee on the reverse bill. <*>

The footnote. Article 51 as amended by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 52

After the expiration of the established deadlines:

for presentation of a bill of exchange due upon presentation or at a certain time after presentation;

to protest non-acceptance or non-payment;

to be presented for payment in case of a "turnover without costs" clause,

The holder of the bill of exchange loses his rights against the endorsers, against the drawee, and against other obligated persons, with the exception of the acceptor.

In the event of failure to declare acceptance within the time stipulated by the drawee, the holder of the bill is deprived of the rights belonging to him, arising both as a result of non-payment and as a result of non-acceptance, unless it follows from the content of the condition that the drawee intended to release himself only from responsibility for acceptance.

If the time limit for presentation is stipulated in the endorsement, then only the endorser can refer to it.

Article 53

If an insurmountable obstacle (a legislative order from a State or another force majeure event) prevents the presentation of a bill of exchange or the making of a protest within the prescribed time frame, these deadlines will be extended.

The holder of the bill of exchange is obliged to notify his endorser without delay of the case of force majeure and to make a note of this notification on the bill of exchange or on the extension, indicating its date and signing; otherwise, the rules of article 44 apply.

After the termination of force majeure, the holder of the bill of exchange must immediately present the bill for acceptance or payment and, if necessary, make a protest.

If the force majeure action continues for more than thirty days after the due date, then neither the presentation of a bill of exchange nor the making of a protest are necessary for the exercise of recourse.

For bills of exchange due upon presentation or at a certain time after presentation, the thirty-day period runs from the day on which the holder notified his endorser of force majeure; this notification may follow before the expiration of the deadline for presentation of the bill; for bills of exchange due at a certain time after presentation, the thirty-day period is extended by the period from presentation specified in a bill of exchange.

Circumstances concerning the holder of a bill of exchange personally or the person to whom he has entrusted the presentation of a bill of exchange or the making of a protest are not considered force majeure.

Chapter 8. On MEDIATION 1. GENERAL PROVISIONS

Article 54

The drawee, endorser or avalist may specify a person for acceptance or payment in case of need.

A bill of exchange may be accepted or paid under the conditions set out below by a person acting as an intermediary for one of the debtors who are obligated by way of recourse.

The intermediary may be a third party, even the payer, or any person who is already obligated by virtue of the bill of exchange, with the exception of the acceptor.

The mediator must, within two working days, notify the person for whom he has acted of his mediation. In case of non-compliance with this deadline, he is responsible, as appropriate, for the damage caused by his negligence, provided, however, that the losses are subject to compensation in the amount not exceeding the promissory note amount.

ACCEPTANCE BY WAY OF MEDIATION

Article 55

Acceptance by way of mediation may take place in all cases where the holder of the bill of exchange to be accepted has the right to recourse before the due date.

If, in case of need, a person has been indicated in the bill of exchange for acceptance or for payment at the place of payment, the holder of the bill may, before the due date, exercise his right of recourse against the person who made this indication and against the persons who signed after this indication was made, but all this is just provided that he presented the bill of exchange to the specified person and that in the event of the latter's refusal to accept, this refusal was certified by a protest.

In other cases of mediation, the holder of the promissory note may reject the acceptance by way of mediation. However, if he allows acceptance, he loses the right to recourse before the due date of payment against the one at whose expense the acceptance was given, and against those persons who signed their signatures after it.

Article 56

The acceptance by way of mediation is marked on the bill of exchange; the acceptance is signed by the intermediary. It indicates at whose expense it is being made; in the absence of such an indication, acceptance is considered to have been made for the drawee.

Article 57

The acceptor, by way of mediation, is obligated in respect of the holder of the bill of exchange and in respect of the endorsers who made the inscriptions after the person at whose expense he acted as an intermediary, on the same grounds as this person.

Despite the acceptance by way of mediation, the person at whose expense it was made, as well as the persons responsible for it, may demand from the holder against payment of the amount specified in article 47, the delivery of the bill, protest and, in the appropriate case, an invoice with a receipt for payment.

PAYMENT BY WAY OF MEDIATION

Article 58

Payment by way of mediation may take place in all cases when, either at the due date or before the due date, the holder of the promissory note has the right to recourse.

The payment must cover the entire amount to be paid to those for whom the payment is being made.

It must be made at the latest on the day following the last day provided for protesting non-payment.

Article 59

If the bill of exchange has been accepted by intermediaries who have their place of residence at the place of payment, or if persons who have their place of residence there have been indicated for payment in case of need, the holder of the bill of exchange must present the bill to all these persons and, where appropriate, protest non-payment no later than the next day after the last the day allowed for the protest.

If the protest is not completed within this period, then the one who indicated the person for payment in case of need, or the one at whose expense the bill was accepted, as well as subsequent endorsers, cease to be obligated.

Article 60

The holder of the promissory note, who refuses payment by way of mediation, loses his right to recourse against those who would have been released from liability.

Article 61

An intermediary payment must be certified by a receipt made on a bill of exchange, indicating the person for whom the payment was made. In the absence of such an indication, it is considered that the payment has been made for the drawee.

The bill of exchange and the protest, if any, must be handed over to the person who made the payment through mediation.

Article 62

A person who has made a payment by way of mediation acquires the rights arising from a bill of exchange against the person for whom he has paid and against those who are obligated to the latter by the bill of exchange. However, he cannot re-endorse the bill of exchange.

The endorsers following the person who signed the bill and for whom the payment was made are exempt from liability.

In the case of competition between several proposals for payment through mediation, preference is given to the one who releases the largest number of persons from liability. An intermediary who knows that he is violating this rule loses his right to resort to those who would be exempt from liability.

Chapter 9. On THE MULTIPLICITY OF INSTANCES AND ON COPIES 1. MULTIPLE INSTANCES

Article 63

A bill of exchange may be issued in several identical copies.

These copies must be numbered sequentially in the text of the document itself; otherwise, each of them is considered as a separate bill of exchange.

If the bill of exchange does not indicate that it was issued in a single copy, the holder of the bill may require that several copies be issued to him at his expense. To do this, he must contact his immediate endorser, who is obliged to assist him in relation to his endorser, and so on, going back to the bill of lading. The endorsers are required to reproduce the endorsements on new copies.

Article 64

A payment made for one copy is exempt from liability, even if it was not stipulated that this payment repays other copies. However, the payer continues to respond to each accepted and not returned copy.

The endorser who has given copies to various persons, as well as subsequent endorsers, are obligated for all copies that have their signature and have not been returned.

Article 65

The person who sent one of the copies for acceptance must indicate on the other copies the name of the person in whose hands this copy is located. This latter person is obliged to hand it over to the legal holder of another copy.

If it refuses to do so, the holder of the promissory note may exercise the right of claim only after attesting by protest that:

1) that the copy sent for acceptance was not handed over to him, despite his request;

2) that the acceptance or payment could not have been received on another copy.

COPIES

Article 66

Each holder of a bill of exchange has the right to make copies of it.

The copy must faithfully reproduce the original with the endorsements and all other marks found on it. It should indicate where it has been brought to.

It can be endorsed and avowed in the same order and with the same consequences as the original.

Article 67

The copy must indicate the person who holds the original document. The latter is obliged to hand over the specified document to the legal holder of the copy.

If he refuses to do so, the holder of the promissory note may exercise the right of recourse against the endorsers or avalists only after confirming with a protest that the original was not handed over to him, despite his demand.

If there is a reservation on the original document after the last endorsement made before the withdrawal of the copy: "starting from here, the endorsement is valid only on the copy" or any other equivalent formula, then the endorsement placed after that on the original is invalid.

Chapter 10. ABOUT THE CHANGES

Article 68

In the event of a change in the text of the bill of exchange, the persons who signed after this change shall respond in accordance with the content of the amended text; the persons who signed before this shall respond in accordance with the content of the original text.

Chapter 11. The STATUTE OF LIMITATIONS

Article 69

Claims arising from the bill of exchange against the acceptor are settled upon the expiration of three years from the due date.

The claims of the holder of the bill of exchange against the endorsers and against the drawee are settled upon the expiration of one year from the date of the protest made within the prescribed period, or from the date of payment in the case of a turnover clause without costs.

The claims of the endorsers to each other and to the drawee are settled upon the expiration of six months, counting from the day on which the endorser paid the bill, or from the date of filing a claim against him.

In case of loss of the right or expiration of the limitation period, the right to sue remains against the drawee who did not provide coverage, or against the drawee or endorser who unlawfully enriched themselves, or against the acceptor who received coverage or unlawfully enriched himself.

The limitation period may be suspended in accordance with the current legislation of the Republic of Kazakhstan.

Article 70

The limitation period is valid only in relation to the person against whom the action interrupting the limitation period was committed.

Chapter 12. GENERAL REGULATIONS

Article 71

Payment on a bill of exchange due on a legally prescribed non-working day may be requested only on the first following business day. Similarly, all other actions related to the bill of exchange, in particular, the presentation of acceptance and protest, can be performed only on a business day.

If any of these actions must be performed within a certain period of time, the last day of which is a legally established non-working day, then such period is extended until the next working day after the expiration date. Non-working days that fall during the term count towards the term.

Non-working days are considered non-working days in accordance with the current legislation of the Republic of Kazakhstan.

Article 72

The time limits established by law or in the promissory note do not include the day from which the term begins to flow.

Article 73

No grace days, either legally or judicially, are allowed.

Chapter 13. ABOUT A PROMISSORY NOTE

Article 74

A promissory note contains:

1) the name "promissory note", included in the text itself and expressed in the language in which this document was drawn up;

2) an unconditional promise to pay a certain amount of money;

3) specifying the payment term;

4) an indication of the place where the payment is to be made;

5) the name of the person to whom or on whose order the payment is to be made;

6) indication of the date and place of drawing up the bill of exchange;

7) the signature of the person who issues the document (the drawee).

Article 75

A document that does not contain any of the designations specified in the preceding article does not have the force of a promissory note, except in the cases specified in the following paragraphs.

A promissory note, the due date of which is not specified, is considered as payable upon presentation.

In the absence of a special indication, the place of preparation of the document is considered to be the place of payment and at the same time the place of residence of the drawee.

A promissory note that does not indicate the place where it was drawn up is considered to be signed in the place indicated next to the name of the drawee.

Article 76

To a promissory note, since they are not incompatible with the nature of this document, the regulations relating to the bill of exchange and concerning:

endorsement (articles 10-19);

due date (articles 32-36);

payment (articles 37-41);

claim in case of non-acceptance or non-payment (articles 42-49, 51-53);

payment by way of mediation (articles 54, 58-62);

copies (articles 66, 67);

amendments (article 68);

limitation period (articles 69, 70);

non-working days, calculation of time limits and prohibition of grace days (articles 71, 72, 73).

A promissory note is also subject to regulations relating to a bill of exchange payable to a third party or in a place other than the payer's place of residence (Articles 4 and 26), the interest condition (Article 5), differences in the designation of the amount to be paid (Article 6), the consequences of placing any signature in the terms, provided for in article 7, the consequences of the signature of a person who acts without authority or in excess of his authority (Article 8).

Similarly, the regulations regarding the bill of exchange (Articles 29-31) apply to the bill of exchange; in the case provided for in the last paragraph of article 30, if the bill does not specify for whom it is delivered, it is considered that it was delivered for the drawee of the bill of exchange.

Article 77

The drawee of a promissory note is obligated in the same way as the acceptor of a bill of exchange.

Promissory notes for a period of a certain time after presentation must be presented to the drawee for marking within the time limits specified in article 22. The deadline for presentation runs from the date of the mark signed by the drawee on the bill. The refusal of the transferor to put a dated mark is confirmed by a protest (Article 24), the day of which serves as the initial moment for the expiration of the time period from presentation.

Section II PROCEDURE FOR CIRCULATION OF PROMISSORY NOTES IN THE REPUBLIC OF KAZAKHSTAN Chapter 14. GENERAL PROVISIONS

Article 78

Promissory note circulation in the Republic of Kazakhstan is a set of relations that arise regarding the issue of common and transferable commercial bills in the territory of the Republic of Kazakhstan, the transfer of the right of claim on promissory notes, including those issued outside the Republic of Kazakhstan, the fulfillment of obligations on such bills and transactions related to them, their accounting by accounting offices, as well as the issue of common and transferable bills of exchange by the central and local executive bodies of the Republic of Kazakhstan.

The central executive bodies issue promissory notes and bills of exchange based on a decision of the Government of the Republic of Kazakhstan.

The footnote. Article 78 as amended by the Constitutional Law of the Republic of Kazakhstan dated 07/03/2013 No. 121-V (effective after ten calendar days after its first official publication); as amended by the Law of the Republic of Kazakhstan dated 07/02/2018 No. 168-VI (effective after ten calendar days from the date of its first official publication).

Article 79

The relations on the circulation of bills of exchange in the Republic of Kazakhstan are regulated by the Geneva Conventions of Bills of Exchange, as well as the legislation of the Republic of Kazakhstan, consisting of this Law, other legislative acts of the Republic of Kazakhstan, regulatory legal acts of the National Bank of the Republic of Kazakhstan, issued in accordance with them.

The footnote. Article 79 as amended by the Constitutional Law of the Republic of Kazakhstan dated 07/03/2013 No. 121-V (effective ten calendar days after its first official publication).

Article 80

A promissory note obligation arises from the moment of transfer of a duly executed promissory note by the drawee.

A commercial bill is issued to defer payment under purchase and sale agreements, perform work, and provide services (with the exception of financial services).

A promissory note obligation is valid if the promissory note is drawn up in accordance with the requirements established by Articles 1-9 of this Law.

The footnote. Article 80 as amended by the Constitutional Law of the Republic of Kazakhstan dated 07/03/2013 No. 121-V (effective ten calendar days after its first official publication).

Article 81

The allong together with the promissory note is a single document.

The allong should contain an inscription that allows you to unambiguously determine whether the allong belongs to a particular bill. An allong can be attached to a bill of exchange in such a way that the endorsement begins on the bill itself and ends on the allong.

Article 82

The amount of the bill is the amount of money for which it is issued. The amount of the bill does not include the interest indicated in it, penalties and other costs associated with transactions on the bill.

The currency of the promissory note issued in the territory of the Republic of Kazakhstan is tenge. A bill of exchange in foreign currency issued by a resident of the Republic of Kazakhstan for transactions with non-residents of the Republic of Kazakhstan may be circulated in the territory of the Republic of Kazakhstan.

The footnote. Article 82 as amended by the Laws of the Republic of Kazakhstan dated 07/09/2003 No. 482; dated 07/02/2018 No. 168-VI (effective from 07/01/2019).

Article 83

Banks and organizations carrying out certain types of banking operations, if they have the appropriate license, are entitled to carry out the following types of operations with promissory notes:

acceptance of promissory notes for collection;

provision of services for the payment of bills by the payer;

payment of domiciled bills;

acceptance of bills of exchange by way of mediation.

Bill accounting operations are carried out only by accounting offices.

Banks have the right to deposit promissory notes only if they have a license to issue bank guarantees providing for execution in cash. <*>

The footnote. The new version of Article 83 is adopted by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 83-1

Promissory notes in the territory of the Republic of Kazakhstan can be issued on ordinary and promissory note paper.

The requirements for the degrees of protection of promissory notes produced in the territory of the Republic of Kazakhstan or imported into its territory, as well as the technical requirements for promissory notes, are established by the National Bank of the Republic of Kazakhstan.

In the case of a bill of exchange issued on promissory note paper, the text of such bill must be written in the state and Russian languages. Additional use of other foreign languages is allowed. <*>

The footnote. The Law was supplemented by a new article 83-1 - by the Law of the Republic of Kazakhstan dated December 24, 2001 No. 276; the new version of the article - by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482. Amended by the Law of the Republic of Kazakhstan dated July 8, 2005 No. 69.

Chapter 15. THE FUNCTIONS OF PROMISSORY NOTES AS A MEANS OF PAYMENT AND LENDING

Article 84

Legal entities and individuals in the territory of the Republic of Kazakhstan have the right to use promissory notes and bills of exchange in settlements between themselves, provided that this is provided for in the relevant agreement and does not contradict this Law.

Promissory note settlements through accounting offices are carried out in accordance with the procedure established by the National Bank of the Republic of Kazakhstan.

The procedure for forwarding bills accepted for collection by communication institutions is determined by regulatory legal acts of the authorized body of the Republic of Kazakhstan, issued in coordination with the National Bank of the Republic of Kazakhstan, and an agreement between the communication institution and the accounting office.

Article 85

Article 85 is deleted by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 86

Acceptance of promissory notes by accounting offices by endorsement before the due date with payment of the promissory note amount to the bearer of the promissory note is called promissory note accounting. The accounting office has the right to deduct a discount from the bill of exchange amount, which is set by the accounting office independently.

The accounting procedure for promissory notes, as well as transactions with promissory notes by banks and organizations engaged in certain types of banking operations, are established by regulatory legal acts of the National Bank of the Republic of Kazakhstan.

The footnote. Article 86 as amended by the Laws of the Republic of Kazakhstan dated 07/09/2003 No. 482; dated 07/08/2005 No. 69; dated 07/02/2018 No. 168-VI (effective after ten calendar days from the date of its first official publication).

Article 87

Article 87 was deleted by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 88

The coverage of a bill of exchange is understood as the establishment by the drawee of such relations with the person indicated in the bill as the payer, by virtue of which the drawee has the right to demand that the payer fulfill any obligations. At the same time, the amount of such obligation must not be lower than the amount of the bill payment.

The holder of the bill of exchange has the right to require the drawee to cover the bill of exchange. The drawee is obliged to ensure that the bill is covered by the due date.

Article 89

Payment of a letter of credit and repayment of a bank loan by pledging a promissory note are secured in accordance with the procedure established by the National Bank of the Republic of Kazakhstan. The transfer of a bill of exchange as collateral is carried out in compliance with the requirements for issuing an endorsement.

In all other cases, the deposit of a promissory note is not allowed.

The pledge of promissory notes and registration of such transactions in the territory of the Republic of Kazakhstan are carried out through the relevant accounting offices. <*>

The footnote. Article 89 as amended by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Chapter 16. CIRCULATION OF PROMISSORY NOTES OF NON-RESIDENTS OF THE REPUBLIC OF KAZAKHSTAN. TRANSACTIONS WITH PROMISSORY NOTES IN FOREIGN CURRENCY

Article 90

The circulation of promissory notes issued by non-residents of the Republic of Kazakhstan on the territory of the Republic of Kazakhstan is regulated by the promissory note legislation of the Republic of Kazakhstan.

A promissory note obligation accepted by a resident of the Republic of Kazakhstan outside the Republic of Kazakhstan will be valid on the territory of the Republic of Kazakhstan only if all the requirements imposed by the promissory note legislation of the Republic of Kazakhstan have been met.

Article 91

The exchange rate of a bill of exchange is determined according to the exchange rate of such currency set by the accounting office that serves the payer or accepted the bill for accounting.

Article 92

Rimess can only be used by an accounting office licensed by the National Bank of the Republic of Kazakhstan to conduct currency transactions in mutual settlements with a non-resident of the Republic of Kazakhstan.

Chapter 16-1. Stamp duty

The footnote. The Law was supplemented by a new chapter 16-1 - by the Law of the Republic of Kazakhstan dated December 24, 2001 N 276; chapter deleted - by the Law of the Republic of Kazakhstan dated July 9, 2003 N 482.

Chapter 17. LIABILITY FOR VIOLATION OF PROMISSORY NOTE LEGISLATION

Article 93

A protest about non-acceptance or non-payment of a bill of exchange is made by a notary within one working day from the moment the bill is presented to him by making an appropriate inscription on it and drawing up a written act certifying the fact of non-acceptance or non-payment.

A protest against undating an acceptance must be made in accordance with the procedure and time limits established for making a protest against non-acceptance of a bill of exchange. <*>

The footnote. The new version of Article 93 is adopted by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 94

Foreclosure on the payer's property on a promissory note is carried out only on the basis of a court order or court decision.

The court has no right to consider the terms of the contract that served as the basis for issuing the bill, except in cases when the bill was declared invalid.

In cases where the bill of exchange was drawn up in violation of the requirements established by Articles 1 and 74 of this Law, the bill of exchange is considered invalid. In the event of a dispute over obligations arising from an invalid promissory note, the dispute shall be considered as a case of violation of obligations under the contract specified in the second paragraph of this article. <*>

The footnote. Article 94 as amended by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 95

The issuance of friendly, bronze and financial bills is prohibited on the territory of the Republic of Kazakhstan.

The risk of non-payment on a friendly or bronze bill is borne by the holder of the bill who presented the friendly or bronze bill.

Legal entities and individuals are required to immediately report to the relevant law enforcement agencies the facts of the presentation of bronze bills.

A person guilty of issuing a friendly, bronze or financial bill is liable in accordance with the laws of the Republic of Kazakhstan. <*>

The footnote. Article 95 as amended by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 96

The risk of loss of the promissory note is borne by the holder of the promissory note. The loss of a bill by the holder of a bill of exchange entails the loss of the right of claim on it, except in cases when the drawee has recognized the issuance of the lost bill. Payment on a lost bill of exchange may also be made subject to the restoration of the right to claim it in court.

An application for restoration of the right to a lost promissory note is considered by the court in accordance with the procedure provided for by the current legislation of the Republic of Kazakhstan.

The bill of exchange is issued to replace the lost one and the transfer inscriptions on the bill are restored at the expense of the bill holder who lost it.

The person who undertakes to deliver the bill of exchange is responsible for the loss of the bill from the moment it is accepted for shipment until it is delivered to the addressee. In case of loss of a bill of exchange, it is obliged to reimburse the holder of the bill or the accounting office that performed the collection operations for the lost bill of exchange for all costs associated with the restoration of rights under such a bill. <*>

The footnote. Article 96 as amended by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Article 97 <*>

The footnote. Article 97 was deleted by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

Chapter 18. FINAL PROVISIONS <*>

The footnote. Chapter 18 is deleted by the Law of the Republic of Kazakhstan dated July 9, 2003 No. 482.

President

Republic of Kazakhstan

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