Article 7-3. Cross-country reporting of the Transfer Pricing Law

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1. The intercountry financial statements for the financial year under review shall be submitted to the authorized body by the participant of the international group specified in paragraph 2 of this article no later than 12 months following the financial year under review.

Intercountry reporting for the financial year under review shall be submitted by the participant of the international group specified in paragraph 3 of this article to the authorized body upon his request no later than 12 months from the date of receipt by the participant of the international group of the requirement to submit intercountry reporting.

In this case, the obligation to submit intercountry reports is considered fulfilled if a member of the international group submits a notarized copy of the intercountry reports of the parent company of the international group, which is a non-resident, or an authorized member of the international group (if the parent company of the international group has granted such a member of the international group the authority to submit intercountry reports), containing information similar to the information on cross-country reporting, the requirements for the preparation of which are established by the legislation of the Republic of Kazakhstan on transfer pricing. If the intercountry reporting is submitted electronically by the parent company of the international group or an authorized participant of the international group to the competent authority of a foreign State, notarization of a copy of such reporting is not required.

2. Unless otherwise specified in paragraph 4 of this article, the obligation to submit intercountry reports is assigned to the following members of the international group:

1) the parent company of the international group, which is a resident of the Republic of Kazakhstan;

2) an authorized participant of the international group (if the parent company of the international group, specified in subparagraph 1) of this paragraph, has provided such participant of the international group with the authority to submit cross-country reports).

3. Unless otherwise specified in paragraph 4 of this Article, the obligation to submit intercountry reports at the request of the authorized body applies to the following members of the international group:

1) a resident who is a member of an international group and is not the parent company of an international group or an authorized member of an international group, subject to one of the following conditions:

the parent company of the international group or an authorized participant of the international group (if the parent company of the international group has granted such a participant of the international group the authority to submit intercountry reports) is not a resident of the Republic of Kazakhstan and has no obligations to submit intercountry reports in accordance with the legislation of the State (territory) of which the resident she or he is;

the parent company of an international group or an authorized member of an international group (if the parent company of an international group has granted such a member of an international group the authority to submit intercountry reports) has not fulfilled its obligations to submit intercountry reports (if the authorized body has information, including information received from the competent authority of a foreign state (territory));

the State (territory) in which the parent company of the international group or an authorized member of the international group (if the parent company of the international group has granted such a member of the international group the authority to submit intercountry reports) is resident does not have a valid international agreement with the Republic of Kazakhstan providing for the exchange of information on taxation issues;

the State (territory) in which the parent company of the international group or an authorized member of the international group (if the parent company of the international group has granted such a member of the international group the authority to submit cross-country reports) is resident, allows systematic failure to fulfill obligations for the automatic exchange of information with the authorized body;

2) a non-resident who is a member of an international group and carries out business activities in the Republic of Kazakhstan through a structural subdivision, permanent establishment, subject to one of the conditions similar to those specified in subparagraph 1) of this paragraph.

For the purposes of the fifth paragraph of subparagraph 1) of this paragraph, systematic failure to fulfill obligations on automatic information exchange is understood to mean cases when the competent authority of a foreign state (territory) has refused to provide information on cross-country reporting by the authorized body in the presence of an international agreement (agreement) with the Republic of Kazakhstan providing for the exchange of information on taxation issues., or when the competent authority of a foreign state (territory) has not automatically exchanged information with the authorized body on the data of cross-country reporting in respect of an international group, one of whose participants is a resident of the Republic of Kazakhstan or a non-resident engaged in business activities in the Republic of Kazakhstan through a structural subdivision, permanent establishment, for more than two years after the referral by the authorized body the corresponding request.

4. The provisions of this article apply to the parent company of an international group or an authorized participant of an international group (if the parent company of an international group has granted such participant of an international group the authority to submit intercountry reports), or another participant of an international group who is required to submit intercountry reports at the request of an authorized body, provided that the amount of revenue according to the consolidated financial statements of the international group for the financial year, the immediately preceding reporting financial year for which cross-country reporting is submitted is at least the amount of:

equivalent to 750 million euros using the arithmetic average market exchange rate determined in accordance with the tax legislation of the Republic of Kazakhstan for the relevant financial year, if the parent company of the international group is a resident of the Republic of Kazakhstan.;

established by the legislation of a foreign state in which the parent company of an international group or an authorized participant of an international group is a resident, for the obligation to submit intercountry reports to the competent authority of such state, if the parent company of an international group or an authorized participant of an international group is a non–resident of the Republic of Kazakhstan, and if there is legislation in such a foreign state on the submission of cross-country reporting.

5. The authorized body should request and require the competent authority of a foreign state to provide, through automatic exchange of information on an annual basis, on the basis of an international agreement (agreement) providing for the exchange of information on taxation, cross-country reporting data on the activities of an international group, one of whose participants is a resident of the Republic of Kazakhstan or a non-resident engaged in business activities in the Republic of Kazakhstan. In the Republic of Kazakhstan through a structural unit, permanent establishment, in accordance with the procedure and terms established by the parties to such an international agreement (agreement).

6. The authorized body must send, through the automatic exchange of information, on the basis of an existing international agreement (agreement), one of the parties to which is the Republic of Kazakhstan, providing for the provision on the exchange of information on taxation, the relevant data of the intercountry reporting submitted in the Republic of Kazakhstan by the parent company of the international group or an authorized participant of the international group, to the competent authority of a foreign state (territory), in which a member of an international group is a resident or non-resident engaged in business activities through a structural subdivision or permanent establishment, at the request of a foreign state in accordance with the procedure and terms established by the parties to such an international agreement (agreement), provided that the competent authority of the foreign state (territory) complies with the principle of reciprocity.

For the purposes of this article, the principle of reciprocity means the mutual submission of intercountry reporting data by the authorized body and the competent authority of a foreign State (territory).

The Law of the Republic of Kazakhstan dated July 5, 2008 No. 67-IV.

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Republic of Kazakhstan

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