Commentary on Article 197 of the Criminal Code of the Republic of Kazakhstan. Transportation, Acquisition, Sale, Storage of Oil and Petroleum Products, as Well as Processing of Oil Without Documents Confirming the Legality of Their Origin

1. Transportation, acquisition, sale, storage of oil and petroleum products, as well as processing of oil without documents confirming the legality of their origin —

shall be punishable by a fine of up to one hundred and sixty monthly calculation indices, or corrective labor in the same amount, or community service for a period of up to one hundred and sixty hours, or arrest for a period of up to forty days.

2. The same acts committed repeatedly —

shall be punishable by a fine of up to two hundred monthly calculation indices, or corrective labor in the same amount, or community service for a period of up to two hundred hours, or arrest for a period of up to fifty days.

3. The acts provided for in parts one or two of this Article, committed on a large scale —

shall be punishable by a fine of up to three thousand monthly calculation indices, or corrective labor in the same amount, or community service for a period of up to eight hundred hours, or restriction of liberty for a period of up to three years, or imprisonment for the same period, with or without confiscation of property.

4. The acts provided for in parts one, two or three of this Article, committed:

1) by a criminal group;

2) on an especially large scale, — shall be punishable by imprisonment for a period of three to six years, with or without confiscation of property.

The public danger of the criminal offence (parts 1 and 2 constitute criminal misdemeanors, while parts 3 and 4 constitute crimes) lies in the fact that, by taking possession of another person's property, the perpetrator causes material damage both to the owner of the property and to another person in whose possession the property was located.

The object of the criminal offence under consideration is property.

In accordance with the Constitution of the Republic of Kazakhstan, subsoil and the mineral resources contained therein are state-owned (paragraph 3 of Article 6 of the Constitution).

State ownership of subsoil is one of the constituent elements of the foundations of the state sovereignty of the Republic of Kazakhstan. The State ensures access to subsoil on the grounds, under the conditions and within the limits provided for by the Code of the Republic of Kazakhstan dated December 27, 2017, “On Subsoil and Subsoil Use”.

The subject matter of the offence is property in the form of oil and petroleum products.

According to the aforementioned Code, oil means crude oil, gas condensate, as well as hydrocarbons obtained after the purification of crude oil and the processing of combustible shale, oil-bituminous rocks or tar sands.

Crude oil includes any hydrocarbons, regardless of their specific gravity, extracted from the subsoil in a liquid state under normal atmospheric temperature and pressure conditions, including those formed from raw gas as a result of natural condensation.

Raw gas means any hydrocarbons, regardless of their specific gravity, extracted from the subsoil in a gaseous state under normal atmospheric temperature and pressure conditions, including untreated natural gas, associated gas, shale gas, coal-bed methane, as well as non-hydrocarbon gases contained therein.

Associated gas means a multicomponent mixture of hydrocarbons and non-hydrocarbon gases that is dissolved in oil under reservoir conditions and is released from it when pressure decreases.

Under the Law of the Republic of Kazakhstan dated July 20, 2011, “On State Regulation of the Production and Turnover of Certain Types of Petroleum Products”, petroleum products mean certain types of petroleum products: gasoline, aviation fuel, diesel fuel and fuel oil.

According to paragraph 4 of Article 19 of this Law, when petroleum products are sold wholesale or retail, as well as when petroleum products are exported and imported, accompanying waybills shall be issued in accordance with the rules approved by the authorized body in the field of petroleum product turnover.

An accompanying waybill is a document accompanying petroleum products throughout their entire route from the consignor to the consignee, intended to monitor the turnover of petroleum products and required for documenting operations involving the release and acceptance of petroleum products, as well as operations involving the transfer of petroleum products to oil suppliers (paragraph 28 of Article 1 of the aforementioned Law).

At the same time, Article 20 of the Law states that the transportation of crude oil, gas condensate, processing products and petroleum products by railway, road, sea, inland waterway and air transport is permitted using specially equipped vehicles authorized for transportation in accordance with the requirements imposed by the legislation of the Republic of Kazakhstan on the carriage of dangerous goods. Such legislation includes the Rules for the Carriage of Dangerous Goods by Rail, approved at the fifteenth meeting of the Council for Railway Transport of the Member States of the Commonwealth of Independent States on April 5, 1996.

When selling and (or) shipping petroleum products, as well as when carrying out operations involving the transportation of petroleum products by railway, road, sea, inland waterway and air transport, accompanying waybills must be issued.

Documents related to the transportation of crude oil, gas condensate and petroleum products by railway, road, sea, inland waterway and air transport must comply with the requirements established for the transportation of dangerous goods for each type of transport.

The design and operating conditions of facilities used for the storage and transportation of crude oil, gas condensate and petroleum products by railway, road, sea, inland waterway and air transport must comply with the requirements of technical regulations.

The objective element is expressed in the transportation, acquisition, sale and storage of oil and petroleum products, as well as the processing of oil without documents confirming the legality of their origin.

Transportation of oil and petroleum products means their movement by any means (carriage, dispatch, delivery by a courier, etc.).

Acquisition of oil and petroleum products is understood as obtaining them into permanent or temporary possession by any means (purchase, exchange and the like).

Sale means the transfer of oil and petroleum products to individuals or legal entities, whether for consideration or free of charge, by any means.

Storage of oil and petroleum products means actual possession of them, regardless of their specific location (in a dwelling, outbuildings, a specially equipped hiding place, etc.).

Processing of oil means the process of its physical and chemical treatment, resulting in the production of petroleum products (motor fuel, energy fuel, petroleum oils, etc.).

From the subjective side, the criminal offence under consideration is characterized by guilt in the form of direct intent. The perpetrator is aware of the public danger of transporting, acquiring, selling and storing oil and petroleum products, as well as processing oil without documents confirming the legality of their origin, foresees the possibility or inevitability of socially dangerous consequences and desires their occurrence.

The subject is a sane individual who has reached the age of sixteen.

The legislator identifies the following qualifying elements of the Article under consideration: commission of the same acts repeatedly and on a large scale.

The particularly qualifying elements include the commission of the same acts:

by a criminal group;

on an especially large scale.

The qualifying elements “repeatedly” and “by a criminal group” were examined in detail in the analysis of parts 3 and 4 of Article 188 of the Criminal Code.

According to subparagraph 38) of Article 3 of the Criminal Code, with regard to the transportation, acquisition, sale and storage of oil and petroleum products, as well as the processing of oil without documents confirming the legality of their origin, a large scale is recognized as damage in an amount exceeding one thousand times the monthly calculation index.

An especially large scale is recognized as the value of property or the amount of damage exceeding four thousand times the monthly calculation index (subparagraph 3) of Article 3 of the Criminal Code).

The acts provided for in parts 1 and 2 of Article 197 of the Criminal Code are classified as criminal misdemeanors.

The act provided for in part 3 of Article 197 of the Criminal Code is classified as a crime of medium gravity.

The act provided for in part 4 of Article 197 of the Criminal Code is classified as a serious crime.

Commentary of 2021 on the Criminal Code of the Republic of Kazakhstan, by Isidor Shamilovich Borchashvili, Honored Figure of Kazakhstan, Doctor of Law, Professor, Academician of the Kazakhstan National Academy of Natural Sciences, member of the Scientific Advisory Councils under the Constitutional Council of the Republic of Kazakhstan and the Supreme Court of the Republic of Kazakhstan, member of the working group on reforming the law enforcement system under the Security Council of the Republic of Kazakhstan, Honored Employee of the Ministry of Internal Affairs of the Republic of Kazakhstan.

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