Article 6-3. Accounting and storage of allocated assets The Law on Project Financing and Securitization

Home / RLA / Article 6-3. Accounting and storage of allocated assets The Law on Project Financing and Securitization

1. The allocated assets of a special financial company are stored and accounted for in accounts with the custodian bank in accordance with the custody agreement.

2. A custody agreement is concluded between the custodian bank and a special financial company, as well as with the investment portfolio manager, in case of investment of temporarily available proceeds on allocated assets by a special financial company.

3. The form of a standard custody agreement is developed and approved by the authorized body.

4. The custodian bank is obliged to immediately notify the authorized body, the special financial company managing the investment portfolio, as well as the stock exchange, if the transaction is concluded in its trading system, of the inconsistency of the concluded transaction with the legislation of the Republic of Kazakhstan.

5. The procedure for the custodian bank to control the targeted placement of assets of a special financial company is determined by the authorized body.

6. The custodian bank informs the special financial company on a monthly basis about the status of its accounts.

7. A custodial agreement must be concluded simultaneously with only one custodian bank.

8. The custody agreement may be terminated, along with the general grounds for termination of obligations under the agreement, in one of the following cases::

1) based on the relevant decision of the executive body of a special financial company;

2) at the request of the investment portfolio manager;

3) by decision of the custodian bank;

4) upon termination of the custodian bank's license issued by the authorized body.

In case of suspension or revocation of the custodian bank's license, the custodian bank must notify the special financial company in writing within three calendar days.

The initiator of the termination of the custody agreement is obliged to notify the parties to the agreement thirty calendar days before the scheduled termination date.

The custody agreement is considered terminated after the completion of the procedure for transferring assets of a special financial company to a new custodian bank in accordance with the procedure established by the authorized body.

The footnote. Article 6-3 as amended by the Law of the Republic of Kazakhstan dated 24.11.2015 No. 422-V (effective from 01.01.2016).

The Law of the Republic of Kazakhstan dated February 20, 2006 No. 126.

This Law establishes the legal basis and conditions for project financing and securitization in the Republic of Kazakhstan, defines the specifics of the assignment of claims and the legal regime of property in project financing and securitization, the legal status of a special financial company, as well as the legal basis and conditions for syndicated financing.

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