AFFILIATED COMPANIES IN THE REPUBLIC OF KAZAKHSTAN: THE HISTORY OF FORMATION

Abstract

The study is aimed at exploring the genesis of the concept of «affiliated persons» in the legal system of the Republic of Kazakhstan, identifying the reasons for its introduction, analyzing the regulatory evolution and consequences for economic relations. The main goal is to determine how the category of affiliation became a regulatory tool in the context of the transition to a market economy, as well as to reveal legal loopholes that contributed to abuse during the privatization period.

The work uses a historical and legal analysis of normative acts (1993-1999), a study of judicial practice, as well as a comparative legal method for comparison with the legislation of the Russian Federation. Additionally, a contextual analysis of the economic processes of the 1990s was used.

It was established that the concept of «affiliated persons» was introduced in 1993 as part of the second stage of privatization to formalize control over investment and privatization funds (IPFs). However, the lack of clear legal regulation and criteria for liability allowed IPFs to withdraw assets through affiliated structures under the guise of legal transactions. This led to the concentration of property in a narrow circle of individuals and discredited the idea of people's privatization. The subsequent consolidation of the term in the laws «On the Securities Market» (1997) and «On Joint Stock Companies» (1998) expanded its content but retained the fragmentation of regulation.

The results of the study can be used to improve corporate legislation, develop mechanisms to counter conflicts of interest, and also in training courses on the history of law in Kazakhstan.

The institution of affiliation became a response to the challenges of the market transformation of the 1990s, but its initial legal uncertainty created the ground for abuse. Despite the gradual detailing in laws, the lack of a systematic approach (for example, a separate law or inclusion in the Civil Code) limits the effectiveness of the concept in modern conditions.