On recognition of illegal inaction on appeal
No. 6001-23-00-6ap/889 (2) dated 31.10.2023
Plaintiff: LLP "X" (hereinafter referred to as the Partnership)
Respondent: State Institution "Ministry of Industry and Infrastructural Development of the Republic of Kazakhstan" (hereinafter – the Ministry)
The subject of the dispute: the recognition of illegal inaction on the application for the inclusion of blocks in the program of management of the state fund of the subsoil, the compulsion to include blocks in the program of management of the state fund of the subsoil
Review of the plaintiff's cassation complaint PLOT:
The Partnership filed a lawsuit with the Ministry, arguing that on May 4, 2021, the Partnership contacted the Ministry about the inclusion of blocks in the State Subsoil Fund management program (hereinafter referred to as the SDF) in order to be able to apply for a license to explore solid minerals (hereinafter referred to as the TPI) in the future.
On May 19 and June 25, 2021, the Ministry provided relevant responses. The Partnership, having not received a full response to the appeal dated May 4, 2021, sent a complaint through the e-Otinish service on May 31, 2022 about the failure to provide a response and the lack of a decision on the appeal. Subsequently, the Ministry refused to allow the Partnership to include blocks in the IGFN, even in the part where there are no restrictions, whereas if the Ministry had satisfied the request, the Partnership would have applied for a license to explore/extract TPI. Meanwhile, as a result of the Ministry's inaction, some of the requested blocks were illegally transferred to LLP.
"K", which violated the rights of the Partnership.
Judicial acts:
1st instance: the claim was denied. The claim regarding the requirement to declare illegal actions to issue an exploration license has been returned.
Appeal: judicial acts are upheld.
Cassation: judicial acts are upheld.
Conclusions: it follows from the case file that on May 4, 2021, the Partnership applied to the Ministry for the inclusion of blocks in the PUGFN with the possibility of further applying for a license to explore the TPI.
On May 19, 2021, the Ministry replied that if the requested blocks are free from subsurface use and there are no prohibitive regulations in accordance with articles 19, 25, 26, 74, 186, 203 The Code of the Republic of Kazakhstan "On Subsoil and Subsurface Use" (hereinafter referred to as the Code) will be taken into account when making changes to the PUGFN. The request of the Partnership will be taken into account.. If the requested blocks are occupied, as well as non-compliance with the Code, the response will be sent additionally.
Later, on June 25, 2021, the Ministry additionally sent a response to the Partnership's appeal, from which it follows that on the requested territory with an area of 2,844,004 square kilometers: the groundwater deposits of U. (CPV), T. uch. (CPV), T. (CPV) are fully located; the territory of the State Forest Natural Reserve "T. branch, A. forestry" and "T. branch, B-B forestry".
In the requested territory: rivers flow; highways pass.
Taking into account the above, in order to confirm the possibility of carrying out exploration/production of TPI on the territory of specially protected areas and on the lands of the water fund, the Partnership must contact the relevant state authorities.
The imposition of the requested blocks (about 40%) on the territory of specially protected areas is confirmed by letter of RCGI K LLP No. 26-14-04/192 dated March 19, 2021, which was submitted by the plaintiff to the court.
On May 31, 2022, the Partnership sent a complaint via the E-Otinish service about the failure to provide a response and the lack of a decision on the appeal.
The Court of First Instance, rejecting the claim, concluded that the Ministry, having considered the appeal of the Partnership, provided the latter with the opportunity to apply to authorized state bodies to confirm the possibility of conducting exploration / production of TPI in specially protected areas and on the lands of the water fund. This, in the court's opinion, testified to the absence of inaction on the part of the Ministry, and an exhaustive response was given to the Partnership's appeal with reference to the norms of the law from the body responsible for reviewing the appeal.
The partial return of the claims is motivated by the fact that the legality of the exploration license TPI No. 1616-EL dated February 16, 2022 can be verified in civil proceedings if challenged by a person whose right has been violated by the issuance of the license.
The appellate judicial board agreed with the conclusions of the court of first instance.
Thus, the Partnership applied for the inclusion of blocks on the territory of East Kazakhstan region in the PUGFN due to the fact that it represents the interests of foreign investors in the Republic of Kazakhstan and in connection with the latter's interest in opening a number of territories of Kazakhstan for the purposes of conducting subsurface use operations.
The Partnership's request to include the requested blocks in the PFN for the purposes of conducting subsurface use operations is not based on its own interest, but on the interest of third parties - the Partnership's clients. The latter did not prove the contrary to the court.
On June 25, 2021, the Ministry replied to the Partnership that groundwater deposits are located in the requested territory, rivers flow, and highways pass. Therefore, in order to confirm the possibility of carrying out exploration/production of TPI on the territory of specially protected areas and on the lands of the water fund, the Partnership needs to contact the relevant state authorities.
In accordance with paragraph 1 of Article 26 of the Codec, restrictions on conducting subsurface use operations in specially protected natural territories and within subsurface areas of special ecological, scientific, historical, cultural and recreational value are established by the legislation of the Republic of Kazakhstan in the field of specially protected natural territories.
According to article 53 and subparagraph 3) of paragraph 1 of Article 48 of the Law of the Republic of Kazakhstan "On Specially Protected Natural Territories", exploration and mining of minerals is prohibited in the protected areas of state natural parks and reserves, except for the cases specified in paragraph 2 of Article 84-2 of the said Law.
In addition, subparagraph 10) of paragraph 1 of Article 25 of the Code prohibits the conduct of subsurface use operations in other territories where it is prohibited to conduct subsurface use operations in accordance with other laws of the Republic of Kazakhstan.
Paragraph 2 of the said article of the Code stipulates that the provision of a subsurface area for use, the external territorial boundaries of which are completely located within the territories specified in paragraph 1 of Article 25, is prohibited.
Thus, the Ministry's response dated June 25, 2021 is consistent with the above-mentioned legislation.
Taking into account the above, and also taking into account the lack of the Partnership's own interest in including the requested blocks in the IGFN, the board concludes that the Ministry has not allowed violations of the plaintiff's rights and legitimate interests, inaction in refusing to implement, restrict, or terminate the plaintiff's rights.
The defendant, having considered the plaintiff's appeal, replied to him, within the limits of his competence, about the imposition of the requested blocks (about 40%) on the territory of specially protected areas, and therefore the Partnership needs to contact authorized state bodies to confirm the possibility of conducting exploration/production of TPI on the territory of specially protected areas and on the lands of the water fund.
The lawsuit provides arguments and grounds for disagreement with the Ministry's responses, thereby challenging the legality of the responses dated May 19 and June 25, 2021, while there was virtually no inaction on the part of the Ministry, since the Ministry gave exhaustive answers to the Partnership's appeal with reference to the norms of the law.
The court reasonably refused to satisfy the Partnership's claim to compel the Ministry to include the blocks in the IGFN, since the Partnership does not have confirmation from the relevant authorized bodies about the possibility of conducting exploration/production of TPI in the requested territories.
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