Selected regulatory trends in Kazakhstan until 2019

September 12, 2018

On September 1, Kazakhstan officially starts a new political season. Addressing a joint session of the Chambers of the Parliament, President Nursultan Nazarbayev designated tasks for the legislature and the executive. This review presents the most significant changes that business should expect in the upcoming season until the beginning of 2019.

Pharmaceutical industry

• The most significant change that industry representatives should expect starting from 2019 is the introduction of price regulation for the drugs. The corresponding bill was adopted by the lower house of the Parliament. Presumably, its formal consideration by the Senate will take place in September, then the bill will be sent to the President for a signature in October. The introduction of amendments is planned from January 1, 2019. The full implementation of state price regulation is scheduled for October 1, 2019.

It should be noted here that, despite the fact that the bill has not yet been discussed in the upper chamber of the Parliament, there are no possibilities to work on adjusting the text taking into account the interests of the industry. We should expect a quick review of the bill by the Senate and its signing by the President. 

However, the industry still has time and opportunities to submit its policy proposals concerning the developed legislative acts: the rules of procedure for registering producer prices, the creation of a regressive scale of marginal wholesale and retail mark-ups for drugs, the pricing methodology, etc.

• The draft Code "On People’s Health and The Health Care System" has been issued for public consultations. The draft Code will include 7 sections: general provisions, a section on public healthcare, then on medical care organisation, educational and scientific activities, pharmaceutical activities and the circulation of drugs, the human resources of the system, as well as a section on healthcare-related legal aspects. 

Significant for the industry are provisions on improving registration procedures, drug certification and inspection of manufacturers, as well as the development of regulation of preclinical and clinical research in the field of pharmacy. In addition, amendments to current legislation are possible to bring it in line with EAEU and WTO regulations.

Innovation and IT

• The Concept of the draft law to regulate digital innovations was issued for public consultations. The document describes the scope of amendments to sectoral legislation regulating public relations related to the use and implementation of blockchain, biometric authentication, tokens and digital assets, personal data, information security, etc. The initiators of the bill propose amendments and changes regarding:

- Legal qualification of new information objects and information-related services.

- Changes in the branch law "On Informatisation" and secondary legislation: The Rules for Classifying Information Objects, the Unified Requirements in the Field of Information and Communication Technologies and Information Security, etc.

- Personal data protection and cross-border transfer.

- Introduction of a legal concept of mining and related amendments for its regulation.

• Work on developing an E-commerce Concept in Kazakhstan has started. It is planned to submit the document for interagency approval till October.

Product tracebility

• In July of this year, a discussion on the Concept of the National Information System for Tagging and Traceability of Goods was launched. It is assumed that the text of the Concept will form the basis of amendments or additions to current legislation of Kazakhstan. Currently, first discussions of Concept’s text were held with public authorities, representatives of industry associations, representatives of business working in Kazakhstan and importing their products to the country. It is expected that, by the end of 2018, pilot testing of the system will be launched for different product groups. According to information from the Ministry of Finance of Kazakhstan, business participation in the pilot testing is voluntary. As a next step, the developers plan to begin a gradual tagging introduction for various product groups from 2019.

Environmental legislation

• A draft Environmental Code of the Republic of Kazakhstan has been issued for public consultations. The document involves a large-scale revision of current legislation, rather than amendments to it. The most significant initiatives include fundamentally revising the policy of extended producer (importer) responsibility. To date, work has begun in the working group of the NCE “Atameken” to develop the text of the new Code.