On the ratification of the Loan Agreement (Customs Service Development Project) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development

Home / RLA / On the ratification of the Loan Agreement (Customs Service Development Project) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development

The Law of the Republic of Kazakhstan dated November 19, 2008 No. 84-IV

To ratify the Loan Agreement (Customs Service Development Project) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development, signed in Astana on February 2, 2008.

President of the Republic of Kazakhstan N. Nazarbayev

LOAN NUMBER 4874-KZ

Loan Agreement (Customs Service Development Project) between THE REPUBLIC OF KAZAKHSTAN BY THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

dated February 2, 2008

LOAN NUMBER 4874-KZ

LOAN AGREEMENT

Agreement dated February 2, 2008 between the REPUBLIC OF KAZAKHSTAN (the Borrower) and the INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (The Bank). The Borrower and the Bank hereby agree on the following:

ARTICLE I - GENERAL CONDITIONS; DEFINITIONS

1.01. The General Terms and Conditions (defined in the Addendum to this Agreement) are an integral part of this Agreement. 1.02. Unless the context otherwise requires, the terms beginning with capital letters used in the Loan Agreement have the meanings assigned to them in the General Terms and Conditions or in the Addendum to this Agreement.

ARTICLE II - LOAN

2.01. The Bank agrees to provide the Borrower with an amount equal to eighteen million five hundred thousand US dollars (18 500 000 US dollars) (Loan) for the term and conditions set forth or specified in this Agreement to support the financing of the project described in Appendix 1 to this Agreement (Project). 2.02. The Borrower has the right to withdraw the Loan funds in accordance with section IV of Appendix 2 to this Agreement. 2.03. The Borrower pays the Bank a commission for reserving loan funds equal to a quarter of one percent (0.25%) of the Loan amount. The borrower pays a commission for reserving the loan funds no later than 60 (sixty) days after the effective date. 2.04. The Borrower pays interest at a rate equal to the LIBOR Base Rate for the Loan Currency plus a floating spread for each interest accrual period. Notwithstanding the above, if any part of the Withdrawn Loan Balance remains unpaid on time and is not paid within 30 days, the interest paid by the Borrower must be calculated as described in Section 3.02 (d) of the General Provisions. 2.05. The payment dates are January 15th and July 15th of each year. 2.06. The Borrower repays the principal amount of the Loan in accordance with the repayment schedule set out in Appendix 3 to this Agreement.

ARTICLE III - THE DRAFT

3.01. The Borrower declares its commitment to the objectives of the Project and for this purpose implements the Project through CPC in accordance with the provisions of Article 5 of the General Terms and Conditions; 3.02. Unless otherwise agreed with the Bank and subject to the restrictions contained in the provisions of Section 3.01 of this Agreement, the Borrower ensures the implementation of the Project in accordance with the provisions of Annex 2 to this Agreement.

ARTICLE IV - ENTRY INTO FORCE; TERMINATION

4.01. Additional conditions for entry into force include the following: (a) The Borrower establishes a Supervisory Committee for the Project, the composition, resources and terms of reference of which are acceptable to the Bank. (b) The Borrower will adopt Implementation Guidelines acceptable to the Bank. 4.02. The final effective date is the date following the expiration of one hundred and eighty (180) days after the date of this agreement.

ARTICLE V - REPRESENTATIVE OF THE BORROWER; ADDRESSES

5.01. The Borrower's Minister of Finance is the Borrower's representative. 5.02. Borrower's address: Ministry of Finance Pobedy Avenue, 11 Astana, 010000 Republic of Kazakhstan Telex: 265126 (FILIN) Fax: (7) (7172) 717785

5.03. Bank's Address: International Bank for Reconstruction and Development 1818 H Street, N,W. Washington, D.C. 20433 United States of America Telegraph: Telex: Fax: INBAFRAD 248423 (MCI) 1-(202) 477-6391 Washington, D.C. 64145 (MCI)

AGREED in Astana, Republic of Kazakhstan, on the day and year indicated above.

 FOR THE REPUBLIC OF KAZAKHSTAN

Authorized representative

 FOR THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

Authorized representative

APPENDIX 1

Project Description

The aim of the proposed Project is to increase the efficiency, productivity and accountability of the CPC in order to: (i) introduce internationally recognized best practices in the expeditious processing of international trade flows by customs services to further integrate the country into the global economy, improve the investment climate and increase competitiveness, (ii) improve taxpayer compliance with the requirements of the Customs Code, and thereby thereby, increase revenue collection, and (iii) to support the transparency of customs operations in order to reduce corruption opportunities and increase predictability for participants in foreign economic activity.

The project consists of the following parts:

Part I:Institutional development, management and human resources

Providing technical assistance, goods, and training to: (a) review the CPC's organizational structure; (b) review the CPC's strategic planning methodology in order to assist in the establishment of a strategic planning department; (c) develop service standards, review the organization's performance, and create a modern information system management, including the development of an operational management center and a management information support system; (d) reviewing, restructuring, developing and implementing a State Plan for the development of Integrity within the framework of the current anti-corruption system; (e) developing and implementing a human resources management strategy, including the implementation of a performance-based human resources management system; (f) developing a comprehensive learning strategy and curricula; (g) preparing a strategy for integrated change management and continuous improvement; and (h) the introduction of cost-based financial management mechanisms designed to monitor the costs of customs services and improve current financial management processes and procedures related to international best practices.

Part II:Customs operations

Providing technical assistance, goods, and training to: (a) analyze legislation governing the movement of vehicles and goods, as well as bring existing laws into line with key international documents and best practices, and prepare amendments to laws designed to support new systems and procedures.; (b) analyzing and adopting laws and regulations designed to improve coordination between the Customs service and other agencies involved in regulating international trade, as well as creating a special unit staffed with tariff, legal, and system development specialists to build and maintain a unified tariff system and develop software for electronic systems (c) supporting the implementation of a new cargo control and declaration processing regime; (d) strengthening the ultimate functions of post-customs inspection and auditing; (e) strengthening law enforcement and border control functions through training, equipment procurement, information gathering, research and anti-smuggling capabilities, and improved information exchange; (f) developing a comprehensive monitoring and enforcement strategy.

Part III:Information and communication technologies

Providing technical assistance, goods, and training to: (a) strengthen the organizational capacity of CPC in the field of ICT system planning and management, as well as to implement a strategy for recruiting and retaining information technology specialists; (b) the development and improvement of integrated ICT systems; and (c) the strengthening of the CTC's data archiving, storage and security capabilities.

Part IV:Program management

Provision of goods, training, and payment of CPC operating costs to ensure Project coordination, implementation, and management.

APPENDIX 2

Project Execution

Section I.Institutional arrangements

A. Institutional arrangements

The Borrower must implement the Project in accordance with the following institutional and other arrangements: 1. The Borrower, through CPC, must implement the Project in accordance with the requirements, criteria, organizational mechanisms and operational procedures specified in the Project Implementation Manual, and must not transfer, amend, cancel or waive any provisions of the Project Implementation Manual without prior approval by the Bank. 2. The NCP will be fully responsible for Project supervision, policy guidance, and interagency coordination in accordance with the requirements, criteria, organizational arrangements, and operational procedures specified in the Project Implementation Guidelines. 3. Throughout the entire Project implementation, the Borrower must ensure that the composition, resources and terms of reference of the NCP are satisfactory to the Bank. 4. The Borrower must ensure that, until the completion of the Project, CPC continuously operates in a manner and with the involvement of staff, consultants, funds and other resources necessary for the management and implementation of the Project that would be satisfactory to the Bank, including an appropriate organizational structure for the implementation, financial management and procurement of the Project. 5. The total amount of the Project should be financed as follows: 30% of the Loan amount and 70% from the borrower's own contribution. In order to ensure the availability of funds necessary to finance the Borrower's contribution to the Project, the Borrower must annually allocate appropriate budgetary funds to the CPC.

V. Mid-term review

1. On or near June 30, 2010, the Borrower, through the Ministry of Finance and CPC, must jointly conduct a Mid-term Review of the progress achieved during the implementation of the Project (hereinafter referred to as the "Mid-term Review"). The mid-term review should, among other things, describe: (a) progress towards achieving the objectives of the project; and (b) the overall results of the project compared to the performance indicators of the project. 2. The Borrower, through CPC, must provide the Bank, at least four (4) weeks before the Mid-Term Review, with a separate report describing the progress of each component of the Project and a brief general report on the implementation of the Project.

Section II.Project monitoring, reporting and evaluation

But. Project Reports

1. The Borrower monitors and evaluates the progress of the Project, and prepares Project Reports in accordance with the provisions of Section 5.08 of the General Terms and Conditions and based on indicators agreed with the Bank. Each Project Report must cover a period of one calendar quarter and be submitted to the Bank no later than forty-five (45) days after the end of the period covered by this report. 2. Pursuant to Section 5.08 (c) of the General Terms and Conditions, the Project implementation report and the corresponding plan required by this Section must be provided to the Bank no later than six (6) months after the closing date of the project.

B. Financial management, financial reporting and audit

1. The Borrower is required to maintain or monitor the financial management system in accordance with the provisions of Section 5.09 of the General Terms and Conditions. 2. Without prejudice to the provisions of Part A of this Section, the Borrower is required to prepare and submit to the Bank, no later than forty-five (45) days after the end of each calendar quarter, interim and non-audited financial reports on the Project for that quarter in a form and content acceptable to the Bank. 3. The Borrower is required to audit its Financial Statements in accordance with the provisions of Section 5.09 (b) of the General Terms and Conditions. Each audit of the Financial Statements should cover a period of one (1) financial year of the Borrower. The audited Financial Statements for each such period must be submitted to the Bank no later than six (6) months after the end of each such period.

Section III.Purchases

But.General provisions

1.Products. All goods required for the Project are procured in accordance with the requirements contained or referenced in Section I of the Procurement Manual, as well as in accordance with the provisions of this Annex. 2.Consulting services. All consultant services required for the Project are procured in accordance with the requirements contained or referenced in Sections I and IV of the Guidelines "Selection and Hiring of Consultants by World Bank Borrowers" (Consultant Guidelines), as well as in accordance with the provisions of this Section. 3. Definitions. The concepts starting with capital letters used below in this Section to describe certain procurement methods or the bank's review methods for certain contracts correspond to the definitions prescribed by it in the Procurement Manual or the Consultant Manual, as appropriate.

B.Selected methods of purchasing goods

1.International competitive bidding. Unless otherwise provided in paragraph 2 below, the purchase of goods is carried out under contracts concluded in accordance with International Competitive bidding procedures, in accordance with the requirements established or referred to in Section II of the Procurement Manual. 2.Other methods of purchasing goods and services. The table below shows the procurement methods, except for International Competitive Bidding, that can be used in relation to goods. The procurement plan should contain the circumstances in which a particular method was used.

Purchasing method

(a) National competitive bidding, in accordance with the additional provisions set out in the Appendix to this Annex 2

(b) Purchases in a retail network

V.Selected methods of purchasing consultants' services

1.Selection based on quality and cost. Unless otherwise provided in paragraph 2 below, the procurement of consulting services is carried out within the framework of contracts awarded on the basis of an assessment based on quality and cost. 2.Other methods of purchasing consultants' services. The table below shows the procurement methods, other than Selection based on quality and cost, that can be used in relation to consultant services. The procurement plan must contain the circumstances in which a particular method was used.

Purchasing method

(a) Selection based on the qualifications of consultants

(b) The procedures set out in paragraphs 5.2 and 5.3 of the Consultant Guidelines for the Selection of Individual Consultants

G.The Bank's review of procurement decisions

The procurement plan should indicate those contracts that are subject to Preliminary Review by the Bank. All other contracts are subject to Subsequent review by the Bank.

Section IV.Withdrawal of Loan funds from the account

But. General provisions

1. The Borrower may withdraw the Loan funds in accordance with the provisions of Article II of the General Terms and Conditions, this Section, and those additional instructions that the Bank specifies in the notification to the Borrower (including the World Bank's May 2006 Guidelines for the Disbursement of Project Funds, which are periodically reviewed by the Bank and applicable to this Agreement in accordance with such Instructions), in order to finance Eligible expenses, according to the table in paragraph 2 below. 2. The table below defines the categories of Eligible Expenses to be financed from the Loan (the "Category"), the allocated Loan amounts for each Category, and the percentage of expenses to be financed as Eligible Expenses for each Category.

Category

Allocated Loan amount (in dollar terms)

Share of expenses to be financed (in %)

(1) Products

12 150 000

32 %

(2) Consulting services and training

6 350 000

33 %

total

18 500 000

B. Withdrawal conditions; withdrawal period

1. Regardless of the provisions of Part A of this Section, funds will not be withdrawn: (a) from the Loan account until the Bank receives full payment of the loan reservation fee; and (b) for payments made prior to the date of this Agreement. 2. The Loan closing date is December 31, 2012.

Addendum to Appendix 2

The Borrower's National Competitive Bidding procedures may be used to purchase works under this Project, subject to the following provisions:

A.Participation of State-owned enterprises

State-owned enterprises in the Borrower's territory have the right to participate in auctions only if they can officially confirm their legal and financial independence, if they operate on the basis of commercial law and are not an institution dependent on the contacting agency. Moreover, they will be subject to the same requirements regarding applications and reliability of effectiveness as other applicants.

B.Tender documentation

Procurement institutions should use a standard package of tender documents for the purchase of goods acceptable to the Bank.

B.Opening and evaluation of applications

(a) Applications are opened publicly, immediately after the deadline for submitting applications; (b) Applications should be evaluated in strict accordance with the monetary criteria stated in the tender documentation; (c) The principle of preference for domestic suppliers should not be applied; (d) Contracts are awarded to a qualified applicant who submitted an application that meets the maximum requirements. all requirements and with the lowest estimated cost, while negotiations are not provided.

G.Price adjustment

Contracts for construction work designed for a long period (for example, more than eighteen (18) months) must contain an appropriate price adjustment provision.

D.Cancellation of the bidding process

The tender is not recognized as valid, and the collection of new applications should not be carried out without the prior consent of the Bank.

E.Rejection of individual applications

Each individual application can be rejected only in the following cases: (a) if the applicant does not meet the qualification requirements; (b) the applicant does not accept the correction of the arithmetic error contained in his tender application made by the Tender Commission of the procuring entity; and (c) the applicant does not respond to the requirements for the tender documentation.

APPENDIX 3

Depreciation schedule

The date of payment of the principal debt

Repayment of the principal amount of the loan (in US dollars)

Every January 15th and July 15th

Starting from July 15, 2013

Until January 15, 2023

925 000

addition

Section I. Definitions

1. "Category" is the category indicated in the table of Section IV of Annex 4 to this Agreement. 2. "CPC" means the Customs Control Committee of the Ministry of Finance of the Republic of Kazakhstan, subordinate to the Minister of Finance of the Borrower. 3. "Guidance on Consultants" - "Guidance: Selection and hiring of consultants by borrowers of the World Bank", published by the Bank in May 2004. 4. "General Conditions" - "General Conditions for Loans of the International Bank for Reconstruction and Development" dated July 1, 2005, as amended in Section II of this Annex. 5. "Ministry of Finance" means the Ministry of Finance of the Borrower or any of its legal successors or assigns. 6. "Operating expenses" means the operating expenses incurred by CPC in connection with the implementation, management and monitoring of the Project, including staff salaries and costs for consulting services, training, conferences, internships and seminars, dissemination of information on the Project, office rent and utilities, insurance, office maintenance and repair and equipment. maintenance and repair of vehicles, transportation costs, security and communication costs, banking costs and other various costs, directly related to the implementation of the Project, incurred in accordance with periodic budgets acceptable to the Bank. 7. "Implementation Guide" means a guide acceptable to the Bank and accepted by the Borrower in accordance with Section 4.01 (b) of this Agreement, which describes Project implementation procedures that do not contradict the provisions of this Agreement, the Borrower's local laws and regulations, and include, but are not limited to: (i) management procedures processes of administration, procurement, accounting, financial management, monitoring and evaluation mechanisms; (ii) standard formats of annual reports; they may be amended from time to time with the consent of the Bank. 8. The Procurement Manual is the Procurement Manual for IBRD Loans and MAP Loans, published by the Bank in May 2004. 9. "Procurement Plan" is the Borrower's procurement plan for the Project dated September 2007, which is referenced in paragraph 1.16 of the Procurement Manual and paragraph 1.24 of the Consultant Manual, at the same time, subject to updating in accordance with the provisions of these paragraphs. 10. "NCP" means the Project Supervisory Committee established by the Borrower in accordance with Section 4.01 (a) of this Agreement and responsible for the supervision, policy guidance and interagency coordination of the Project. It must meet at least twice a year and hold meetings under the chairmanship of the Borrower's Minister of Finance or his authorized representative. The Committee will include: (i) the Chairman of the CPC or his authorized representative; (ii) a representative of the Ministry of Economy and Budget Planning of the Borrower; (iii) representatives of government agencies responsible for exercising control functions at the State border; and (v) representatives of participants in foreign economic activity, such as customs brokers. 11. "Training" means Project-related internships, training courses, seminars, practical exercises and other training activities not included in contracts for the supply of goods or services, including the cost of training materials, rental of premises and equipment, transportation costs, travel expenses of trainees and instructors, as well as payment for instructors.

 Section II. Amendments to the Basic Conditions

The following amendments have been made to the basic conditions: 1. Section 3.01 reads as follows: "Section 3.01.One-time commission fee. The Borrower undertakes to pay a one-time commission fee to the Bank for the Loan amount in the amount specified in the Loan Agreement ("One-time Commission Fee"). 2. A new paragraph (d) has been added to Section 3.02 "Interest": "(d) Regardless of the terms of paragraph (a) of this Section, if any loan amount withdrawn is not paid on time and the payment is thirty days overdue, the Borrower undertakes to pay the interest rate for the overdue payment instead of the interest rate specified in the Contract Loan (or other interest rate according to Article IV as a result of the Conversion) until the overdue amount is fully paid. Interest on the penalty rate will be accrued from the first day of each late payment interest period and is subject to semi-annual arrears on each Payment Date." 3. The Definitions appendix has been corrected as follows: (a)Paragraph 19, "Commitment fees," has been deleted, and subsequent paragraphs are numbered accordingly. (b)New paragraphs 27, 28, 29 and 30 have been added to the Appendix: "27. "Late payment interest period" means for each overdue amount of the withdrawn loan balance, each interest accrual period during which such overdue amount remains unpaid; provided that the first late payment interest accrual period begins on the 31st day after the date on which the payment is overdue, and the last interest accrual period The overdue payment will end on the day when the overdue amount is fully paid. 28. "Late payment interest rate" means for each late payment interest period: (a) in the case of a Loan with a variable price difference: LIBOR default plus a variable price sacristy plus one second of interest (0.5%); (b) in the case of a fixed Loan, whose interest on the amount of the loan balance - which includes the interest accrual period for the overdue payment - should have been paid at a variable interest rate immediately before applying the late payment interest rate: default on variable interest rate plus one-second interest (0.5%); and (c) in the case of a Fixed Loan, whose interest on the amount of the loan balance - which includes the late payment interest period - should have been paid at a variable interest rate immediately prior to the application of the late payment interest rate: LIBOR default plus a fixed installment plus one second of interest (0.5%). 29. "LIBOR default" means the LIBOR for the relevant interest accrual period; This means that for the initial interest accrual period for the overdue payment, the LIBOR default will be equal to the LIBOR for the interest accrual period in which the amount indicated in paragraph (d) of Section 3.02 was overdue for the first time. 30. "Variable interest rate default" means the variable interest rate for the relevant interest accrual period; This implies that for the initial interest accrual period for a late payment, the default on the variable interest rate will be equal to the variable interest rate for the interest accrual period in which the amount indicated in paragraph (d) of Section 3.02 was overdue for the first time." (c)Paragraph 43 "Fixed installments" (as renumbered) is rephrased as follows: "43. "Fixed Installment Plan" means the Bank's fixed installment plan for the original loan currency, effective at 12:01 p.m. Washington, D.C. time, one calendar day prior to the date of the Loan Agreement; provided that upon currency conversion of all or any part of the loan balance, such fixed installment plan will be consistent with the date of signing the Agreement by specified in the Conversion principles; and provided that, notwithstanding the preceding, for the purpose of determining the late payment interest rate applicable to the withdrawn balance of a loan on which interest is accrued at a fixed rate, "fixed installment plan" means the Bank's fixed installment plan, effective at 12:01 p.m. Washington, D.C. time, one calendar day before the date of conclusion of the Loan Agreement for the currency denomination of the specified amount." (d)Item 66 "Loan repayment" (as renumbered)fixed as follows: "66. "Loan Repayment" means any amount payable by the Parties to the Loan Agreement to the Bank in accordance with legal agreements or these General Terms and Conditions, including (but not limited to) any amount of the loan balance, interest, one-time commission fees (if any), early payment fees, any transaction fees for currency conversion or completion of conversion, any rewards for a fixed maximum interest rate or a fixed maximum and minimum interest rate, as well as any installment amounts, payable by the Borrower." (e)Item 71 "Payment date" (as renumbered)fixed as follows: "71. "Payment Date" means the date specified in the Loan Agreement - the day after the conclusion of the Loan Agreement on which the interest is to be paid."

I hereby certify that this translation corresponds to the text of the Loan Agreement (Customs Service Development Project) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development in English, signed in Astana on February 2, 2008.

Vice Minister of Finance  Of the Republic of Kazakhstan Ergozhin

RCPI's note: The following is the text of the Loan Agreement (Customs Service Development Project) between the Republic of Kazakhstan and the International Bank for Reconstruction and Development in English.

President

Republic of Kazakhstan

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