Article 15-31. Council of the Financial Ombudsman Service of the Law on State Regulation, Control and Supervision of the Financial Market and Financial Organizations

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1. The Council of the Financial Ombudsman Service is a permanent collegial governing body of the Financial Ombudsman Service.

The Council of the Financial Ombudsman Service consists of the following members:

1) one representative from the founder of the Financial Ombudsman Service;

2) one representative from banks, branches of non–resident banks of the Republic of Kazakhstan;

3) one representative from insurance (reinsurance) organizations, branches of insurance (reinsurance) organizations that are non–residents of the Republic of Kazakhstan;

4) one representative from microfinance organizations;

5) one representative from organizations engaged in brokerage activities on the securities market;

6) one representative from collection agencies to whom the rights (claims) have been assigned under a bank loan agreement or a micro-loan agreement;

7) one representative from the authorized body.

The members of the Board of the Financial Ombudsman Service must have an impeccable business reputation, higher economic and (or) legal education.

2. The following issues fall within the competence of the Council of the Financial Ombudsman Service:

1) monitoring the compliance of the Financial Ombudsman service with its statutory objectives;

2) approval of the structure and staff of the Financial Ombudsman service and the number of financial ombudsmen;

3) the proposal of candidates for election to the positions of the Chief Financial Ombudsman and financial ombudsmen in the relevant areas of financial services;

4) election and early termination of the powers of the Chief Financial Ombudsman and Financial Ombudsman in the relevant areas;

5) determination of the system of remuneration and bonuses for financial ombudsmen;

6) approval of the annual budget, the procedure and terms of financing of the Financial Ombudsman service and the annual report on the results of the Financial Ombudsman Service;

7) approval of internal rules on the implementation of the activities of financial ombudsmen and the Financial Ombudsman Service;

8) approval of the methodology for determining the amount of damage caused to the consumer of financial services under insurance contracts;

9) exercise of other powers.

3. A meeting of the Council of the Financial Ombudsman Service is recognized as valid and the conditions of the quorum are met if at least five members of the Council of the Financial Ombudsman Service are present at the meeting. The Council of the Financial Ombudsman Service makes decisions by a simple majority vote of its representatives.

A decision on the issues provided for in subparagraphs 6) and 7) of paragraph 2 of this article shall be deemed to have been taken only if there is a positive decision by a representative of the Council of the Financial Ombudsman service from the authorized body.

The decision on the election of the Chief Financial Ombudsman is made by a majority vote of the members of the Council of the Financial Ombudsman Service.

The Chief Financial Ombudsman participates in meetings of the Council of the Financial Ombudsman Service without the right to vote.

4. The members of the Council of the Financial Ombudsman Service perform their functions free of charge.

The procedure for the election and early termination of the powers of the members of the Council of the Financial Ombudsman Service is determined by the statute of the Financial Ombudsman Service.

The Law of the Republic of Kazakhstan dated July 4, 2003 No. 474-II.

This Law regulates public relations related to the implementation of state regulation, control and supervision of the financial market and financial organizations, and is aimed at increasing the stability of the financial system of the Republic of Kazakhstan and creating conditions to prevent violations of the rights and legitimate interests of consumers of financial services.

President

Republic of Kazakhstan

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