Mass dismissal of claims by Kazakhstan courts: what is the danger of a 'lockdown' of the judicial system
Over the past few weeks, social networks have been full of publications by lawyers about massive returns of claims by first instance courts (district courts, specialized interdistrict economic courts, etc.). Since the end of June, the judicial system has actually stopped accepting claims - judging by reviews, approximately 90% of filed claims are returned by the courts for one reason or another, and more than once.
As practice shows, the new approach to “returning claims” has affected all claims in contractual disputes - they are returned by the courts in almost all cases. The situation is similar in cases of rehabilitation and bankruptcy of companies, although the President ordered the introduction of a moratorium only on those bankruptcies of companies that were initiated by unscrupulous creditors. Following the President's order, a Government resolution was issued that further narrowed this initiative - until October 1, only government bodies and quasi-public sector entities were prohibited from filing bankruptcy claims against their debtors. Despite all this, the courts interpret the moratorium on bankruptcy broadly - for example, bankruptcy claims by the debtors themselves are returned, or claims from creditors who are not related to the state and the specified Government resolution.
Moreover, claims for the rehabilitation of companies are also returning, although rehabilitation, on the contrary, is needed like air by the affected business in the current “perfect storm.” Rehabilitation is a procedure introduced by a court decision in which the debtor can settle the claims of creditors under court protection (all claims, enforcement proceedings, accrual of penalties and fines are suspended), restore his solvency and prevent bankruptcy. Currently, in practice, this very useful option is not available to businesses.
Almat Daumov
Partner
GRATA International
