Commentary to article 160. Imaginary or pretended transactions of the Civil Code of the Republic of Kazakhstan  

An imaginary transaction is a transaction made only to mislead others. The parties themselves are aware that there is no deal and it does not impose any obligations on them. For example, fearing confiscation of property, a person against whom a criminal case has been initiated "sells" the most valuable things to a relative, agreeing with him that he will not receive money from him and he will return the things at the first request. Imaginary transactions are also called fictitious.

An imaginary transaction should not be executed at the request of a party who would like to benefit from it.  

The obligation to prove the fictitiousness of the transaction lies with the one who makes such a claim. The fact confirming the imaginary nature of the transaction is usually the failure of the parties to perform those actions that are part of its content.  

If the fictitiousness of a transaction is not proven, its legality, validity and consequences are determined by the general conditions of validity and invalidity of transactions.  

In contrast to the imaginary will of the parties in a fake deal, it is aimed at establishing civil rights and obligations. But not those who make up the external appearance for others, but others, which parties actually had in mind.

A fake deal is most often aimed at circumventing the prohibition of the law. But there may also be such fake transactions that are not aimed at achieving an illegal result, although they create a false impression among others about the real intentions of the parties. A citizen, for example, would not want to make public his special attitude towards another person. Therefore, by donating valuable property to him, a citizen formsalizes the transfer by a contract of sale, although in reality he does not receive money for the property. Sometimes a fake deal arises from the legal ignorance of the parties who do not know how to properly formalize a completely legitimate agreement.  

Since two transactions are distinguishable in a fake one, each of them needs to be independently evaluated. A deal that covers up another one is always invalid. It does not lead to any consequences, since the parties did not actually seek them.  

As for the disguised transaction that the parties have actually committed, its legality or illegality is determined by factual evidence. If, according to such signs, the parties violated the law, the covered transaction is also invalid.  

In the case when a completely legitimate transaction was covered up, which does not violate the legally protected interests of the state and third parties, it is recognized as valid and its execution does not entail any adverse consequences for the parties.

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The commentary was prepared within the framework of the scientific and practical research program of the Scientific Research Center of Private Law of the Kazakh State Law University.  

Head of the working group on the preparation of the draft Civil Code of the Republic of Kazakhstan, Corresponding Member of the Academy of Sciences of the Republic of Kazakhstan, Professor Suleimenov M.K.

Deputy head Professor Basin Yu.G.