Commentary on Article 334. Unauthorized Use of Subsoil Resources of the Criminal Code of the Republic of Kazakhstan

1. Unauthorized use of subsoil resources, as well as unauthorized extraction of mineral resources, if these acts have caused substantial damage, —

shall be punishable by a fine in an amount of up to two hundred monthly calculation indices, or corrective labour 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, with deprivation of the right to hold certain positions or engage in certain activities for a period of up to three years, or without such deprivation.

2. The same acts, if they have resulted in the infliction of particularly substantial damage, —

shall be punishable by a fine in an amount of up to three thousand monthly calculation indices, or corrective labour 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 deprivation of the right to hold certain positions or engage in certain activities for a period of up to three years, or without such deprivation.

3. The acts provided for in Parts One or Two of this Article, if committed by a criminal group, —

shall be punishable by imprisonment for a period of up to five years.

The public danger of unauthorized use of subsoil resources, as well as unauthorized extraction of mineral resources (Part 1 constitutes a criminal offence; Parts 2 and 3 constitute crimes), lies in undermining environmental safety and causing harm to wildlife, flora and the environment as a whole.

The object of the criminal offence under consideration is environmental safety, ensured through the rational use and protection of subsoil resources.

The grounds for obtaining the right to use subsoil resources are provided for by the Code of the Republic of Kazakhstan “On Subsoil and Subsoil Use”.

According to Article 10 of the said Code, subsoil is defined as the part of the Earth's crust located below the soil layer or, in the absence of such a layer, below the Earth's surface, the beds of water bodies and watercourses.

Subsoil resources may not be transferred into the ownership of enterprises, institutions, organisations or individual citizens. Subsoil resources are granted exclusively for use. Any other method of transferring subsoil resources to enterprises, institutions, organisations and citizens is unlawful.

The use of subsoil resources within the territories of populated areas, suburban zones, industrial facilities, transport and communications facilities may be partially or completely prohibited by a decision of the Government of the Republic of Kazakhstan where such use may pose a threat to human life and health, cause damage to economic facilities or harm the environment.

According to Article 77 of the Law of the Republic of Kazakhstan dated 7 July 2006 “On Specially Protected Natural Areas”, subsoil areas of particular environmental, scientific, historical and cultural, and recreational value include:

geological objects — natural and artificial outcrops containing reference or characteristic geological sections, characteristic tectonic structures, rare rocks and minerals, meteorites, and preserved exceptional remains of fauna and flora;

geomorphological objects — terraces, floodplains, caves, gorges, canyons, waterfalls and other landforms that clearly reflect the processes of landform formation and are of particular value for tourism and recreation;

hydrogeological objects — groundwater and its outlets to the surface, distinguished by unique and rare properties;

subsoil areas containing rock paintings, ancient mining excavations and other objects related to the use of subsoil resources that are of historical, archaeological and ethnographic significance.

Any activity that threatens the preservation of geological, geomorphological and hydrological objects belonging to the state nature reserve fund is prohibited in subsoil areas of particular environmental, scientific, historical and cultural, and recreational value, in accordance with the legislation of the Republic of Kazakhstan.

The granting of a subsoil area (areas) for use under the terms of a production-sharing agreement is formalised by a licence for subsoil use. The licence certifies the right to use the specified subsoil area (areas) on the basis of an agreement establishing all the necessary conditions for subsoil use.

A licence is a document certifying the right of its holder to use a subsoil area within specified boundaries, for the purpose indicated therein, during the established period, subject to compliance by the holder with the previously agreed conditions. An agreement may be concluded between the duly authorised state authorities and the subsoil user, establishing the conditions for the use of such area, as well as the obligations of the parties to fulfil the said agreement.

The licence certifies the right to carry out works involving geological exploration of subsoil resources, development of mineral deposits, use of waste generated by mining and related processing industries, use of subsoil resources for purposes unrelated to the extraction of mineral resources, establishment of specially protected geological objects, and collection of mineralogical, palaeontological and other geological collection materials.

The issuance of licences for several types of subsoil use is permitted.

The provision of a land plot for carrying out works related to geological exploration and other use of subsoil resources shall be carried out in accordance with the procedure established by the legislation of the Republic of Kazakhstan, following approval of the project for carrying out the said works.

The objective element of the environmental criminal offence consists of unauthorized use of subsoil resources, as well as unauthorized extraction of mineral resources, provided that these acts have caused substantial damage.

A subsoil user is a natural or legal person who, in accordance with the Law of the Republic of Kazakhstan “On Subsoil and Subsoil Use”, has the right to conduct subsoil use operations.

Rational and comprehensive use of subsoil resources means the economically efficient development of all types of subsoil resources based on the application of advanced technologies and sound practices in the development of mineral deposits.

The right to use subsoil resources is the right of possession and use of subsoil resources acquired by a subsoil user in accordance with the Code of the Republic of Kazakhstan “On Subsoil and Subsoil Use”.

Objects related to the right to use subsoil resources include participation interests (blocks of shares) in a legal entity holding the right to use subsoil resources, as well as in a legal entity that has the ability to directly and (or) indirectly determine decisions and (or) influence decisions made by such subsoil user, provided that the principal activity of that legal entity is related to subsoil use in the Republic of Kazakhstan.

Objects related to the right to use subsoil resources also include securities certifying ownership of shares in, or convertible into shares of, a legal entity holding the right to use subsoil resources, as well as a legal entity that has the ability to directly and (or) indirectly determine decisions and (or) influence decisions made by such subsoil user, provided that the principal activity of that legal entity is related to subsoil use in the Republic of Kazakhstan.

The use of subsoil resources without a permit (licence) shall be regarded as unauthorized use. Unauthorized use of subsoil resources shall be terminated without reimbursement of expenses incurred during the period of illegal use.

Use of subsoil resources in violation of the conditions stipulated by a permit (licence) means changing the designated purpose of works related to subsoil use; failure by the subsoil user to comply with the period established in the licence within which the subsoil user was required to commence subsoil use in the prescribed volumes; and failure to comply with the conditions for implementation established by legislation and by standards (regulations and rules) concerning the protection of subsoil resources and the natural environment and the safe conduct of operations.

Extraction means the entire range of works (operations) associated with removing mineral resources from subsoil to the surface, as well as extracting them from technogenic mineral formations, including the primary processing and temporary storage of mineral raw materials.

A mineral resource is a natural mineral formation, hydrocarbon or groundwater contained in subsoil, whose chemical composition and physical properties make it suitable for use in material production and (or) consumption and (or) other needs, either directly or after processing.

Extraction of commonly occurring mineral resources means any extraction of commonly occurring mineral resources that does not qualify as extraction of commonly occurring mineral resources for personal needs.

Extraction of commonly occurring mineral resources and groundwater for personal needs means extraction carried out on a land plot owned by a person or held under a land-use right, without the intention of subsequently entering into transactions involving the extracted commonly occurring mineral resources or groundwater.

Unauthorized use of subsoil resources or unauthorized extraction of mineral resources entails criminal liability under Part 1 of Article 334 of the Criminal Code only where substantial damage has been caused; consequently, this criminal offence is classified, by its legal structure, as a material offence.

According to Subparagraph 38) of Article 3 of the Criminal Code, substantial damage is defined as the monetary value of the expenses necessary to restore the environment and the consumer properties of natural resources, in an amount exceeding one thousand monthly calculation indices.

The amount of damage indicates an increased degree of public danger of this crime, since significant material damage is caused to the natural environment. The determination of substantial damage by law enforcement authorities has qualifying significance and directly affects the application of one or another part of the criminal law provision to the guilty person, falls within the scope of proof and constitutes an essential condition for ensuring legality in the administration of justice in cases involving environmental crimes (offences).

A single continuing crime consisting of several episodes of unauthorized use of subsoil resources committed with a single intent must also be classified as unauthorized use of subsoil resources causing substantial damage, provided that the total amount of damage exceeds one thousand monthly calculation indices.

If the intent of the guilty person was directed towards unauthorized use of subsoil resources causing substantial damage, but this intent was not carried out due to circumstances beyond that person's control, the act shall be classified as an attempt to commit unauthorized use of subsoil resources under Part 3 of Article 24 and Part 1 of Article 334 of the Criminal Code.

When determining the value of the damage caused, depending on the circumstances of the unauthorized use of subsoil resources, retail, market or commission prices applicable at the time the crime was committed and confirmed by the relevant documents should be taken as the basis. In the absence of prices and where a dispute arises concerning the amount of damage caused, its value shall be determined on the basis of an expert opinion.

The subjective element of the environmental criminal offence is characterised by an intentional form of guilt (direct or indirect intent).

The subject of the criminal offence may be mentally competent Kazakhstani and foreign natural persons who have reached the age of 16.

Several persons may be subjects of the right to use subsoil resources under a single contract. Such persons are joint holders of the right to use subsoil resources and bear joint and several liability for obligations arising under the contract.

Under Part 2 of Article 334 of the Criminal Code, liability arises for unauthorized use of subsoil resources or unauthorized extraction of mineral resources that has resulted in the infliction of particularly substantial damage.

According to Subparagraph 3) of Article 3 of the Criminal Code, particularly substantial damage is defined as the monetary value of the expenses necessary to restore the environment and the consumer properties of natural resources, in an amount exceeding twenty thousand monthly calculation indices.

The criteria for determining the amount of damage are described in the analysis of the act provided for in Part 1 of Article 334 of the Criminal Code.

Part 3 of Article 334 of the Criminal Code contains a particularly aggravating circumstance providing for liability for an environmental criminal offence committed by a criminal group. The concept of a criminal group is defined in Subparagraph 24) of Article 3 and Part 3 of Article 31 of the Criminal Code of the Republic of Kazakhstan.

The act provided for in Part 1 of Article 334 of the Criminal Code constitutes a criminal misdemeanour.

The acts provided for in Parts 2 and 3 of Article 334 of the Criminal Code constitute crimes of medium gravity.

Commentary of 2021 on the Criminal Code of the Republic of Kazakhstan by Isidor Shamilovich Borchashvili, Honoured 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 reform of the law enforcement system under the Security Council of the Republic of Kazakhstan, Honoured Employee of the Ministry of Internal Affairs of the Republic of Kazakhstan.

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