On the ratification of the Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Korea in the field of development, financing, design, construction, operation and maintenance of the Balkhash Thermal Power Plant

Law of the Republic of Kazakhstan dated April 30, 2013 No. 91-V

     To ratify the Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Korea in the field of development, financing, design, construction, operation and maintenance of the Balkhash Thermal Power Plant, signed in Astana on August 25, 2011.

     President of the Republic of Kazakhstan N. NAZARBAYEV

  AGREEMENT between the Government of the Republic of Kazakhstan and the Government of the Republic of Korea in the field of development, financing, design, construction, operation and maintenance of the Balkhash Thermal Power Plant

(Entered into force on May 27, 2013 - Bulletin of International Treaties of the Republic of Kazakhstan 2013, No. 4, Article 39)

     The Government of the Republic of Kazakhstan and the Government of the Republic of Korea (hereinafter referred to as the Parties), expressing interest in the implementation of the Balkhash Thermal Power Plant project (hereinafter referred to as the Project) based on the principles of equality and mutual benefit, taking into account the contracts to be concluded in connection with the implementation of the Project - an agreement for the design, purchase and construction of an electric power plant, an agreement for the operation and maintenance of an electric power plant, a fuel supply agreement, and a long-term service agreement for maintaining the availability of electric capacity of generating units being put into operation (hereinafter referred to as - Project Agreements), emphasizing that this Agreement will facilitate the development of cooperation between the Parties for the successful implementation of the Project and is necessary for the implementation, financing, design, construction, operation and maintenance of the Project, recognizing that the Project will be designed, built, implemented and financed to ensure reliable electricity supply, as well as considering the need to create an enabling environment conditions for investments in the Republic of Kazakhstan, have agreed on the following:       The footnote. The preamble as amended by the Law of the Republic of Kazakhstan dated 11.11.2013 No. 137-V.

  Article 1

     The Project is being implemented by Balkhash Thermal Power Plant Joint Stock Company (hereinafter referred to as the Project Company), which is an independent producer of electric energy, according to the BOOT ("build-own-operate-transfer" - "build-own-manage-transfer") scheme. The Project Company will be owned by the following companies after carrying out the appropriate share determination and share buyback procedures: from the Kazakh side - Samruk-Energy Joint Stock Company; from the Korean side - Korea Electric Power Corporation and Samsung C&T Corporation.

  Article 2

     In order to implement the Project, the Government of the Republic of Kazakhstan will determine an organization that will purchase from the Project Company a service for maintaining the availability of electric capacity of generating units being put into operation in accordance with a long-term agreement that meets the conditions of project financing with limited recourse, at a price, in the amount and terms determined by the Government of the Republic of Kazakhstan.       The footnote. Article 2 as amended by the Law of the Republic of Kazakhstan dated 11.11.2013 No. 137-V.

  Article 3

     The Project Company has the right to receive preferences in accordance with the legislation of the Republic of Kazakhstan.

  Article 4

     For the period of construction and operation of the Project, the Government of the Republic of Kazakhstan reviews documents in a timely manner and issues permits and approvals (including permits to attract foreign labor and visas) in accordance with the legislation of the Republic of Kazakhstan.

  Article 5

     Disputes and disagreements between the Parties in the interpretation and implementation of this Agreement are resolved through negotiations and consultations between the Parties.       Disputes between the parties to the Project Agreements are considered by commercial arbitration in accordance with the Law of the Republic of Kazakhstan dated December 28, 2004 "On International Commercial Arbitration" in the territory of the Republic of Kazakhstan and the conditions stipulated in the relevant Project Agreement.       The decisions of the arbitration court are final, binding and enforceable.

  Article 6

     The Project must be carried out in compliance with environmental requirements for the entire duration of the Project on the basis of modern technologies acceptable from the commercial side, modern design solutions and know-how in accordance with the legislation of the Republic of Kazakhstan. The Government of the Republic of Kazakhstan provides assistance in passing the examination in accordance with the procedures established by the legislation of the Republic of Kazakhstan, as well as in obtaining the necessary permits and approvals for the use of international norms and standards.

  Article 7

     The following government agencies shall coordinate and monitor the implementation of the provisions of this agreement:       from the Kazakh side — the Ministry of Industry and New Technologies of the Republic of Kazakhstan, from the Korean side - the Ministry of Knowledge Economy of the Republic of Korea.

  Article 8

     In cases of amendments and (or) additions to the legislation of the Republic of Kazakhstan on investments, licensing, architectural, urban planning and construction activities that lead to a deterioration in the conditions for the implementation of the Project, its implementation is carried out in accordance with the legislation of the Republic of Kazakhstan in force on the date of signing this Agreement, with the exception of requirements in the field of environmental protection.       In case of introduction (establishment) of new taxes after the date of signing of this Agreement, the norms of the legislation of the Republic of Kazakhstan regarding the introduction (establishment) of new taxes shall not apply to the Project Company and the contractor participating in the Project implementation.       The provisions of this article apply exclusively to income and operations for the implementation of works (services) within the framework of the Project carried out by the Project Company and the contractor participating in the Project, and are valid from the date of signing the loan agreement until the final date specified in the long-term contract for the provision of services to maintain the availability of electric power generating units, again being put into operation.       The provisions of this article do not apply to income taxed at the source of payment in accordance with the tax legislation of the Republic of Kazakhstan.       For the purposes of this article, a contractor is an organization that performs work (services) related to the implementation of a Project for a Project Company.       The footnote. Article 8 as amended by the Law of the Republic of Kazakhstan dated 11.11.2013 No. 137-V.

  Article 9

     In the event of circumstances preventing the Parties from fulfilling their obligations under this Agreement, the Parties shall be guided by the provisions of Agreement on the Promotion and Mutual Protection of Investments between the Government of the Republic of Kazakhstan and the Government of the Republic of Korea dated March 20, 1996.

  Article 10

     By agreement of the Parties, changes and/or additions may be made to this Agreement, including, if necessary, such changes in order to successfully finance the Project with the right of limited recourse, which are its integral parts and are formalized in separate protocols.

Article 11

     This Agreement is concluded for an indefinite period and enters into force from the date of receipt of the last written notification through diplomatic channels that the Parties have completed the internal procedures necessary for its entry into force.       Termination of this Agreement will not affect the fulfillment of obligations stipulated in the Project Agreements concluded under this Agreement during its validity period.       Done in Astana on August 25, 2011, in two originals, each in the Kazakh, Korean, English and Russian languages, all texts being equally authentic. In case of disagreement in the interpretation of the provisions of this Agreement, the English text shall prevail.

     For the Government For the Government of the Republic of Kazakhstan of the Republic of Korea

     RCPI's note!       The following is the text of the Agreement in English.

President    

Republic of Kazakhstan     

© 2012. RSE na PHB "Institute of Legislation and Legal Information of the Republic of Kazakhstan" of the Ministry of Justice of the Republic of Kazakhstan  

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