Law of the Republic of Kazakhstan dated April 28, 1997 No. 97-1 On Bill Circulation in the Republic of Kazakhstan

Law of the Republic of Kazakhstan dated April 28, 1997 No. 97-1 On Bill Circulation in the Republic of Kazakhstan

This Law, in accordance with the Convention establishing a uniform law on bills of exchange and promissory notes, the Convention for the settlement of certain conflicts of laws on bills of exchange and promissory notes, and the Convention on stamp duty in respect of bills of exchange and promissory notes of June 7, 1930, regulates bill circulation in the Republic of Kazakhstan and defines the functions of a bill as a payment instrument and a means of lending.

The main goal of this Law is to regulate public relations related to the circulation of bills in the Republic of Kazakhstan.

The main objectives of this Law are:
1) establishing requirements for bills of exchange and simple commercial promissory notes;
2) defining the procedure for bill circulation in the Republic of Kazakhstan;
3) regulating the use of bills for cashless payments and/or money transfers.

The activities of the National Bank of the Republic of Kazakhstan in the field of bill circulation are based on the principles of:
1) legality;
2) transparency;
3) ensuring equality of all before the law, respect for the rights and freedoms of subjects of bill legal relations.

Concepts used in this Law:

Aval - a bill guarantee, under which the person who made it assumes an obligation to make payment on the bill (in full or in part) for another person liable on the bill.

Avalist - a person who has made an aval.

Acceptance - written consent to pay a bill.

Allonge - an additional sheet to a bill for making endorsements.

Bronze bill - a bill drawn on a fictitious person.

Bill currency - the monetary unit in which the bill amount is expressed.

Drawer - a legal or natural person who issued the bill.

Bill holder - the owner of a bill, who has the right to receive the sum of money specified therein.

Bill - a payment document of a strictly established form, containing a unilateral unconditional monetary obligation.

Bill paper - a type of stamp paper with a certain degree of protection and intended for drawing up a bill on it.

Grace day - a preferential day by which the payment term indicated on the bill is extended.

Discount - the interest charged when discounting bills before the due date.

Domiciled bill - a bill payable by a third party at a place other than the payer's place of residence, on behalf and at the expense of the payer, if this is indicated on the bill itself.

Accommodation bills - bills issued by persons to each other without the drawer's intention to make payment on it, but only for the purpose of raising money through mutual discounting of these bills in a second-tier bank.

Endorsement - a transfer inscription on the back of a bill or on an allonge, certifying the assignment of rights under this bill to another person.

Endorser - the person transferring the bill.

Endorsee - the person in whose favor the bill is transferred by the transfer inscription.

Commercial bill - a bill issued on the basis of contracts of sale, performance of work, provision of services (with the exception of financial services).

Brokerage - remuneration paid to an intermediary when concluding a transaction with a bill.

Place of residence - the place of residence of a natural person (postal address) or the location of a legal entity (postal address).

"Not to order" - a clause included in the bill by the drawer, meaning a prohibition to transfer the bill by endorsement.

"without expenses", "without protest" - a clause included in the text of the bill by the bill holder, endorser, avalist, exempting the bill holder from making a protest of the bill for non-payment or non-acceptance by the drawer.

Persons liable on the bill - those persons to whom a demand for payment of the bill may be presented: the drawer, endorser, payer, acceptor, avalist.

Bill of exchange (draft) - a bill containing an unconditional proposal (order) from the drawer (trassant) to a third party (trassatee) to pay the first bill holder (remittee) or to his order at a specified future time, or upon presentation, the sum of money indicated in the bill.

Procuration endorsement - an inscription on a bill made by the bill holder and intended to transfer certain rights under the bill within the limits established by the endorser.

Promissory note (solo) - a bill containing an unconditional obligation of the drawer to pay on demand or at a specified future time the sum of money indicated in the bill to the bill holder.

Protest of a bill - a written act certifying the non-dating of acceptance or refusal of acceptance or payment.

Recourse - a reverse claim on an unaccepted or unpaid bill.

Re-exchange - a claim that can be formalized as a bill (reverse draft), presented by a person who has lost on the bill, to one of the persons liable on the bill. Re-exchange may include the paid bill amount, interest, penalty, and expenses related to the protest.

Remittance - a bill of exchange in foreign currency, acquired by the debtor for national currency from a third party and sent by him to his foreign creditor in repayment of his debt.

Discounting office - a second-tier bank (hereinafter - bank) licensed to carry out discounting operations.

Financial bill - a bill issued for the purpose of attracting money, as well as on the basis of transactions for the provision of financial services.

Assignment - assignment of a claim in an obligation in accordance with civil legislation.

Section I
ON BILLS OF EXCHANGE AND PROMISSORY NOTES

Chapter 1. ON THE DRAWING AND FORM OF A BILL OF EXCHANGE

Article 1.
A bill of exchange must contain:
1) the designation "bill of exchange" included in the very text of the document and expressed in the language in which this document is drawn up;
2) an unconditional order to pay a specified sum of money;
3) the name of the person who is to pay (the drawee);
4) an indication of the maturity date;
5) an indication of the place where payment is to be made;
6) the name of the person to whom or to whose order payment is to be made;
7) an indication of the date and place of drawing the bill;
8) the signature of the person who issues the bill (the drawer).

Article 2.
A document in which any of the requirements specified in the preceding article is missing does not have the force of a bill of exchange, except in the cases defined in the paragraphs below.
A bill of exchange, the maturity date of which is not indicated, is considered payable on presentation.
In the absence of a special indication, the place designated next to the name of the drawee is considered the place of payment and at the same time the place of residence of the drawee.
A bill of exchange in which the place of its drawing is not indicated is deemed to have been signed at the place designated next to the name of the drawer.

Article 3.
A bill of exchange may be drawn payable to the order of the drawer.
It may be drawn on the drawer himself.
It may be drawn for the account of a third party.

Article 4.
A bill of exchange may be payable at the residence of a third party or at the same place as the drawee's residence, or at any other place.

Article 5.
In a bill of exchange payable at sight or at a certain time after sight, the drawer may stipulate that interest will accrue on the bill amount. In any other bill of exchange, such a condition is deemed unwritten. The interest rate must be indicated in the bill; in the absence of such an indication, the condition is deemed unwritten. Interest accrues from the date of drawing the bill of exchange, unless another date is specified.

Article 6.
If the amount of a bill of exchange is indicated both in words and in figures, then in case of discrepancy between these indications, the bill is valid for the amount indicated in words.
If the amount in a bill of exchange is indicated several times, either in words or in figures, then in case of discrepancy between these indications, the bill is valid only for the smaller amount.

Article 7.
If a bill of exchange bears the signatures of persons incapable of incurring obligations on a bill of exchange, forged signatures or signatures of fictitious persons, or signatures which for any other reason cannot bind the persons who affixed them or on whose behalf it was signed, the signatures of other persons nevertheless remain valid. A missing signature on a bill may be supplemented provided that an officially certified statement, written on the bill of exchange, certifies the will of the person who should have affixed their signature.

Article 8.
Everyone who has signed a bill of exchange as a representative of a person on whose behalf they were not authorized to act is liable as a party to the bill and, if they have paid, has the same rights as the person who was indicated as being represented would have had. The same applies to a representative who has exceeded their authority.

Article 9.
The drawer is liable both for acceptance and for payment.
They may release themselves from liability for acceptance; any condition by which they release themselves from liability for payment is deemed unwritten.

Chapter 2. ON ENDORSEMENT

Article 10.
Every bill of exchange, even if it is issued without an order clause, may be transferred by endorsement.
If the drawer has inserted the words "not to order" or any equivalent expression in the bill of exchange, the document may be transferred only in the form and with the consequences of an ordinary assignment. An endorsement may be made even in favor of the drawee, whether they have accepted the bill or not, or in favor of the drawer, or in favor of any other person liable on the bill. These persons may in turn endorse the bill.

Article 11.
An endorsement must be simple and unconditional. Any condition limiting it is deemed unwritten.
A partial endorsement is invalid.
An endorsement to bearer has the force of a blank endorsement.

Article 12.
An endorsement must be written on the bill of exchange or on a sheet attached thereto (allonge). It must be signed by the endorser.
An endorsement may not contain an indication of the person in whose favor it is made, or it may consist of only the endorser's signature (blank endorsement). In the latter case, for the endorsement to be valid, it must be written on the back of the bill of exchange or on the allonge.

Article 13.
An endorsement transfers all rights arising from the bill of exchange. If the endorsement is blank, the bill holder may:
1) fill in the blank either with their own name or with the name of any other person;
2) endorse the bill in turn by means of a blank or in the name of any other person;
3) transfer the bill to a third party, without filling in the blank and without making an endorsement.

Article 14.
The endorser is liable for acceptance and for payment, unless there is a contrary condition.
They may prohibit further endorsement; in such a case, they are not liable to those persons in whose favor the bill was subsequently endorsed.

Article 15.
The person in possession of a bill of exchange is considered the lawful bill holder if they base their right on an uninterrupted series of endorsements, even if the last endorsement is blank. Crossed-out endorsements are considered unwritten in this case. When a blank endorsement is followed by another endorsement, the person who signed the latter is deemed to have acquired the bill by the blank endorsement. If someone has lost possession of a bill due to any event, the person in possession of the bill who bases their right on the order indicated in the preceding paragraph is obliged to return the bill only if they acquired it in bad faith or, in acquiring it, committed gross negligence.

Article 16.
Persons against whom an action is brought on a bill of exchange cannot set up against the bill holder defenses based on their personal relations with the bill holder or with previous bill holders, unless the bill holder, in acquiring the bill, acted knowingly to the detriment of the debtor.

Article 17.
If an endorsement contains the clause "value for collection", "for collection", "as agent" or any other clause implying a simple mandate, the bill holder may exercise all rights arising from the bill of exchange, but they may endorse it only by way of procuration. In such a case, the liable persons may only set up against the bill holder such defenses as could have been set up against the endorser. The mandate contained in a procuration endorsement does not terminate by reason of the death of the mandator or the occurrence of their incapacity.

Article 18.
If an endorsement contains the clause "value in security", "value in pledge" or any other clause implying a pledge, the bill holder may exercise all rights arising from the bill of exchange, but an endorsement made by them has effect only as a procuration endorsement. Liable persons cannot set up against the bill holder defenses based on their personal relations with the endorser, unless the bill holder, in receiving the bill, acted knowingly to the detriment of the debtor.

Article 19.
An endorsement made after maturity has the same effect as a preceding endorsement. However, an endorsement made after protest for non-payment or after the expiration of the time fixed for drawing up the protest has effect only as an ordinary assignment. Unless the contrary is proved, an undated endorsement is deemed to have been made before the expiration of the time fixed for drawing up the protest.

Chapter 3. ON ACCEPTANCE

Article 20.
A bill of exchange may, before maturity, be presented for acceptance to the drawee at their place of residence by the bill holder or even simply by the person in possession of the bill.

Article 21.
In any bill of exchange, the drawer may stipulate that the bill must be presented for acceptance with or without a fixed time limit.
They may prohibit in the bill its presentation for acceptance, unless it is a bill of exchange payable at a third party's place, or a bill payable at a place other than the drawee's residence, or a bill payable at a certain time after sight. They may also stipulate that presentation for acceptance cannot take place before a specified date. Every endorser may stipulate that the bill must be presented for acceptance with or without a fixed time limit, unless the bill has been declared by the drawer as not subject to acceptance.

Article 22.
Bills of exchange payable at a certain time after sight must be presented for acceptance within one year from their date of issue.
The drawer may shorten this latter period or stipulate a longer period.
These periods may be shortened by endorsers.

Article 23.
The drawee may demand that the bill be presented to them again on the day following the first presentation.
Interested parties may only invoke the non-fulfillment of this demand if this demand was mentioned in the protest.
The bill holder is not obliged to surrender the bill presented for acceptance to the drawee.

Article 24.
Acceptance is noted on the bill of exchange. It is expressed by the word "accepted" or any other equivalent word; it is signed by the drawee. A simple signature of the drawee, placed on the face of the bill, has the force of acceptance. If the bill is payable at a certain time after sight or if it must be presented for acceptance within a certain period by virtue of a special condition, the acceptance must be dated on the day it was given, unless the bill holder requires it to be dated on the day of presentation. In the absence of a date, the bill holder, in order to preserve their rights of recourse against the endorsers and against the drawer, must certify this omission by a timely protest.

Article 25.
Acceptance must be simple and unconditional, however, the drawee may limit it to a part of the sum.
Any other alteration made by the acceptance to the content of the bill of exchange is equivalent to a refusal of acceptance. However, the acceptor is liable according to the terms of their acceptance.

Article 26.
If the drawer has indicated in the bill of exchange a place of payment other than the drawee's place of residence, without indicating at the same time the third party at whose place payment was to be made, the drawee may indicate such a person upon acceptance. In the absence of such an indication, it is presumed that the acceptor has undertaken to make payment themselves at the place of payment. If the bill is payable at the drawee's place of residence, the latter may indicate in the acceptance an address in the same place where payment is to be made.

Article 27.
The drawee, by means of acceptance, undertakes to pay the bill of exchange at maturity.
In case of non-payment, the bill holder, even if they are the drawer, has a direct action against the acceptor, based on the bill of exchange, in respect of all that may be claimed according to Articles 47 and 48.

Article 28.
If the drawee, who has placed their acceptance on the bill of exchange, has crossed it out before returning the bill, it is considered that acceptance was refused. Unless the contrary is proved, it is presumed that the crossing out was made before the return of the document. However, if the drawee has communicated their acceptance in writing to the bill holder or to any of the signatories, they are bound to them according to the terms of their acceptance.

Chapter 4. ON AVAL

Article 29.
Payment of a bill of exchange may be secured in whole or in part of the bill amount by means of an aval.
This security is given by a third party or even by one of the persons who signed the bill.

Article 30.
An aval is given on the bill of exchange or on an additional sheet. An aval may be given by a separate act indicating the place where it was given.
It is expressed by the words "good for aval" or any other equivalent formula; it is signed by the person giving the aval.
For an aval, a simple signature placed by the avalist on the face of the bill of exchange is sufficient, unless this signature is placed by the drawee or the drawer.
The aval must indicate for whose account it is given. In the absence of such an indication, it is deemed to be given for the drawer.

Article 31.
The avalist is liable in the same way as the person for whom they gave the aval.
Their obligation is valid even if the obligation they guaranteed proves to be invalid for any reason other than a defect of form.
By paying the bill of exchange, the avalist acquires the rights arising from the bill of exchange against the person for whom they gave the guarantee, and against those who, by virtue of the bill of exchange, are liable to the latter.

Chapter 5. ON MATURITY

Article 32.
A bill of exchange may be drawn payable:
at sight; at a certain time after sight; at a certain time after date; on a fixed date.
Bills of exchange containing either another designation of maturity or successive maturity dates are invalid.

Article 33.
A bill of exchange payable at sight is payable on presentation. It must be presented for payment within one year from its date of drawing. The drawer may shorten this period or stipulate a longer period. These periods may be shortened by endorsers. The drawer may stipulate that a bill of exchange payable at sight cannot be presented for payment before a certain date. In such a case, the period for presentation runs from that date.

Article 34.
The maturity date of a bill of exchange drawn at a certain time after sight is determined either by the date of acceptance or by the date of protest.
In the absence of protest, an undated acceptance is deemed, in relation to the acceptor, to have been made on the last day of the period provided for presentation for acceptance.

Article 35.
The maturity date of a bill of exchange issued for one or more months from date or from sight falls on the corresponding day of the month in which payment is to be made. If there is no corresponding day in that month, the maturity date falls on the last day of that month. If a bill of exchange is issued for one and a half months or several months with a half from date or from sight, the full months should be counted first. If the maturity date is fixed for the beginning, middle (middle of January, middle of February, etc.) or end of the month, these expressions mean the first, fifteenth, or last day of the month. The expression "eight days" or "fifteen days" means not one or two weeks, but periods of full eight or fifteen days. The expression "half a month" means a period of fifteen days.

Article 36.
If a bill of exchange is payable on a fixed date in a place where a calendar other than that of the place of issue is adopted, the maturity date is deemed to be fixed according to the calendar of the place of payment. If different calendars are in force in the place of issue and in the place of payment for a bill of exchange drawn at a certain time after date, the date corresponding to the day of issue according to the calendar of the place of payment is established, and the maturity date is determined accordingly. The periods for presenting bills of exchange are calculated in accordance with the rules of the preceding paragraph. These rules are not applicable if any clause made in the bill of exchange or even simply the content of the document indicates an intention to adopt other rules.

Chapter 6. ON PAYMENT

Article 37.
The holder of a bill of exchange payable on a fixed date or at a certain time after date or after sight must present the bill of exchange for payment either on the day it is due, or on one of the two following business days.

Article 38.
The drawee may, upon payment of the bill of exchange, demand that it be handed over to them by the bill holder with a receipt for payment.

The holder cannot refuse to accept a partial payment. In the event of a partial payment, the payer may demand that a note be made regarding such payment on the bill and that a receipt be issued to him.

Article 39.
The holder cannot be compelled to accept payment on an order bill before its due date.
The payer who pays before the due date does so at his own risk and peril.
He who pays by the due date is released from the obligation unless there was fraud or gross negligence on his part. He is obliged to check the correctness of the consecutive series of endorsements, but not the signatures of the endorsers.

Article 40.
If an order bill is drawn in a currency that does not circulate in the place of payment, its amount may be paid in the local currency at the exchange rate on the day the payment becomes due. If the debtor delayed payment, the holder may, at his discretion, demand that the amount of the order bill be paid in the local currency at the exchange rate either on the day the payment became due or on the day of payment. The exchange rate of foreign currency is determined according to customs prevailing in the place of payment. However, the drawer may stipulate that the amount payable shall be calculated at the rate indicated in the bill. If the amount of an order bill is denominated in a currency that has the same name in the country of issue and the country of payment but different exchange rates, it is presumed that the currency of the place of payment was intended.

Article 41.
In the event that an order bill is not presented for payment within the time specified in Article 37, each debtor has the right to deposit the bill amount with a person specially authorized by law at the expense, risk, and peril of the holder.

Chapter 7. LAWSUIT IN CASE OF NON-ACCEPTANCE OR NON-PAYMENT

Article 42.
The holder may exercise his right of recourse against endorsers, the drawer, and other liable persons:
upon the arrival of the payment due date; if payment was not made; even before the arrival of the payment due date:
1) if there was a full or partial refusal of acceptance;
2) in the case of recognition of the payer as bankrupt, regardless of whether he accepted the bill or not, in the case of cessation of his payments, even if this circumstance was not established by the court, or in the case of unsuccessful recovery against his property;
3) in the case of recognition of the drawer as bankrupt on a bill not subject to acceptance.
The procedure for establishing by the court the fact of cessation of payments by the payer, as well as the procedure for recovery against property, are established by Article 94 of this Law.
A recourse lawsuit against persons responsible for acceptance and payment on the bill may be filed no later than the due date of the bill (for points 2 and 3 of this article).

Article 43.
Refusal of acceptance or payment must be confirmed by an act certifying the fact of refusal (protest for non-acceptance or non-payment).

Protest may be replaced by a statement made directly on the bill and signed by the payer, except in cases where the drawer in the text of the order bill itself requires the making of a protest by means of an official act. The aforementioned statement must be made within the time limits established for making protests and entered into the registry in accordance with the current legislation of the Republic of Kazakhstan. At the same time, an undated endorsement is presumed to have been placed before the protest. Protest for non-acceptance must be made within the time limits established for presentation for acceptance. If, in the case provided for in the first paragraph of Article 23, the first presentation took place on the last day of the term, then the protest can still be made on the following day. Protest for non-payment must be made either on the day when the order bill is payable or on one of the next two working days. Protest for non-acceptance releases from presentation for payment and from protest for non-payment. In the event of cessation of payments by the payer, regardless of whether he accepted the bill or not, or in the case of unsuccessful recovery against the property of the payer, the holder may exercise his rights only after presenting the bill to the payer for payment and after making a protest. In the case of recognition of the payer as bankrupt, regardless of whether he accepted the bill or not, as well as in the case of recognition of the drawer as bankrupt on a bill not subject to acceptance, for the holder to exercise his rights, it is sufficient to present a court decision recognizing him as bankrupt.

Article 44.
The holder must notify his endorser and the drawer of non-acceptance or non-payment within four working days following the day of the protest or, in the case of the clause "without expenses," following the day of presentation. Each endorser must, within two working days following the day of receipt of the notification, inform his endorser of the received notification, indicating the names and addresses of those who sent the previous notifications, and so on, ascending to the drawer. The above-mentioned terms run from the moment of receipt of the previous notification. If, in accordance with the preceding paragraph, a notification is sent to anyone who put their signature on the order bill, such a notification must also be sent within the same term to the person who gave the aval for them. In the event that any endorser did not indicate their address or indicated it illegibly, it is sufficient that the notification be sent to the endorser who precedes them. The person who should send the notification may do so in any form, even by simply returning the order bill. They must prove that they sent the notification within the established term. It will be considered that the term was observed if the letter containing the notification was sent by mail within the specified term. The person who does not send the notification within the above-mentioned term does not lose their right; they are liable for damages that may occur due to their negligence, however, the amount of compensable losses cannot exceed the amount of the order bill. In the case of protest for non-acceptance or non-payment, the notary is obliged to warn all persons liable on the bill by sending them written notification in accordance with the addresses available on the bill or requested from persons who requested the protest. Expenses for such notification are added to the expenses for the protest.

Article 45.
The drawer, endorser, or avalist may, by means of a clause included in the document and signed "without expenses," "without protest," or any other equivalent clause, release the holder from making, for the exercise of their right of recourse, protest for non-acceptance or non-payment.

This clause does not release the holder from presenting the order bill within the established terms nor from sending notification. Proof of failure to observe terms lies with the party who refers to this circumstance in a dispute with the holder. If the clause is included by the drawer, it has force with respect to all persons who signed the bill; if it is included by an endorser or avalist, it has force only with respect to themselves. If, despite the clause included by the drawer, the holder makes a protest, then the expenses for the protest lie on them. If the clause originates from an endorser or avalist, the expenses for the protest, if one was made, may be claimed from all persons who put their signatures.

Article 46.
All who issued, accepted, endorsed an order bill, or put an aval on it are jointly and severally liable to the holder.
The holder has the right to file a lawsuit against all these persons, against each individually and against all together, without being compelled to observe the sequence in which they obligated themselves.
Such a right also belongs to each person who signed the order bill after having paid it.
A lawsuit filed against one of the liable persons does not prevent filing lawsuits against others, even if they obligated themselves after the initial defendant.

Article 47.
The holder may demand from the person against whom they file a lawsuit:
1) the amount of the order bill, unaccepted or unpaid, with interest, if it was stipulated;
2) a penalty on the bill amount equal to the base rate of the National Bank of the Republic of Kazakhstan on the day on which the bill was supposed to be paid;
3) expenses for the protest, expenses for sending notification, as well as other expenses.
In addition, the holder who filed the lawsuit may include a commission in the amount of 0.01 percent of the bill amount in the claim sum.
If the lawsuit is filed before the arrival of the payment due date, then the discount interest is deducted from the bill amount. This discount interest is calculated according to the official discount rate (bank rate) existing in the place of residence of the holder on the day of filing the lawsuit.

Article 48.
The person who paid the order bill may demand from persons responsible to them:
1) the entire amount paid by them;
2) interest on the said amount, calculated at the rate of the base rate of the National Bank of the Republic of Kazakhstan on the day on which the bill was paid by the plaintiff;
3) expenses incurred.
The person who paid the bill and filed a lawsuit against persons liable on the bill may include a commission in the amount of 0.05 percent of the bill amount in the claim sum.

Article 49.
Each person against whom a lawsuit has been filed or may be filed may demand delivery to them, against payment, the order bill with the protest and with a receipt for payment.
Each endorser who paid the order bill may cross out their endorsement and the subsequent endorsers' endorsements.

Article 50.

In the event of exercising recourse after partial acceptance, the person who pays the amount for which the bill was not accepted may demand a note of this payment on the bill and the issuance of a receipt to them. The holder is additionally obliged to transfer to them a certified copy of the bill and the act of protest so that they may exercise subsequent recourse.

Article 51.
Each person having the right to file a lawsuit may, unless otherwise stipulated, receive payment by means of a new bill (reverse draft), drawn payable at sight on one of the persons responsible to them, with payment at the place of residence of this person. The reverse draft includes, in addition to the amounts specified in Articles 47 and 48, also the brokerage fee for the reverse draft. If the reverse draft is issued by the holder, its amount is established at the rate for order bills payable at sight, drawn on the place of residence of the responsible person in the place of payment of the original bill. If the reverse draft is issued by an endorser, its amount is established at the rate for order bills payable at sight, drawn on the place of residence of the guarantor person in the place of residence of the drawer on the reverse draft.

Article 52.
Upon expiration of the terms established:
for presenting an order bill payable at sight or at a certain time after sight; for making protest for non-acceptance or non-payment; for presentation for payment in the case of the clause "without expenses," - the holder loses their rights against endorsers, against the drawer, and against other liable persons, except the acceptor. In the event of non-presentation for acceptance within the term stipulated by the drawer, the holder loses their rights arising both from non-payment and from non-acceptance, unless it follows from the content of the condition that the drawer intended to release themselves only from liability for acceptance. If the term for presentation is stipulated in the endorsement, then only the endorser may refer to it.

Article 53.
If presentation of the order bill or making of protest within established terms is prevented by force majeure (legislative decree of any state or another case of force majeure), then these terms are extended. The holder is obliged without delay to notify their endorser of the case of force majeure and make a note on the order bill or on the allonge about this notification, indicating its date and putting their signature; otherwise, the rules of Article 44 apply. After the cessation of action of force majeure, the holder must without delay present the bill for acceptance or payment and, if necessary, make a protest. If the action of force majeure continues for more than thirty days after the payment due date, then neither presentation of the bill nor making of protest is necessary for exercising recourse. For order bills payable at sight or at a certain time after sight, the thirty-day term runs from the day on which the holder notified their endorser of the force majeure; this notification may follow even before the expiration of the term for presentation of the bill; for order bills payable at a certain time after sight, the thirty-day term is increased by the term from presentation indicated in the order bill.

Force majeure does not include circumstances concerning personally the holder or the person to whom they entrusted presentation of the bill or making of protest.

Chapter 8. ON INTERMEDIATION

1. GENERAL PROVISIONS

Article 54.
The drawer, endorser, or avalist may indicate any person for acceptance or payment in case of need.
An order bill may be accepted or paid under the conditions established below by a person acting as an intermediary for one of the debtors liable in the order of recourse.
The intermediary may be a third party, even the payer, or any person already liable by virtue of the order bill, except the acceptor.
The intermediary must, within two working days, notify about their intermediation the person for whom they acted. In the event of failure to observe this term, they are liable in appropriate cases for damage caused by their negligence, however, losses are subject to compensation in an amount not exceeding the bill amount.

2. ACCEPTANCE IN THE ORDER OF INTERMEDIATION

Article 55.
Acceptance in the order of intermediation may take place in all cases when the holder of an order bill subject to acceptance has the right to recourse before the arrival of the payment due date.
If a person for acceptance or for payment in the place of payment was indicated in the order bill in case of need, then the holder may, before the arrival of the payment due date, exercise their right of recourse against the person who made this indication and against persons who put their signatures after this indication was made, but all this only on condition that they presented the order bill to the indicated person and that in the case of refusal of the latter of acceptance, this refusal was certified by protest. In other cases of intermediation, the holder may reject acceptance in the order of intermediation. However, if they allow acceptance, they lose the right to recourse before the arrival of the payment due date against the person on whose behalf acceptance was given and against those persons who put their signatures after him.

Article 56.
Acceptance in the order of intermediation is noted on the order bill; the acceptance is signed by the intermediary. It indicates for whose account it is made; in the absence of such indication, the acceptance is considered to have been made for the drawer.

Article 57.
The intermediary acceptor obligates themselves with respect to the holder and with respect to endorsers who made inscriptions after the person for whose account they acted as an intermediary, on the same grounds as this person. Despite acceptance in the order of intermediation, the person for whose account it was made, as well as persons responsible for him, may demand from the holder against payment of the amount specified in Article 47, delivery of the bill, protest, and in the appropriate case - an account with a receipt for payment.

3. PAYMENT IN THE ORDER OF INTERMEDIATION

Article 58.
Payment in the order of intermediation may take place in all cases when either upon the arrival of the payment due date or before the arrival of the payment due date, the holder has arisen the right to recourse. Payment must cover the entire amount payable to the person for whom payment is made. It must be made no later than the next day after the last day provided for making protest for non-payment.

Article 59.
If the order bill was accepted by intermediaries having their place of residence in the place of payment, or in the event that persons having their place of residence there were also indicated for payment in case of need, then the holder must present the bill to all these persons and in the appropriate cases make protest for non-payment no later than the next day after the last day provided for making protest. If the protest is not made within this term, then the person who indicated the person for payment in case of need, or the person for whose account the bill was accepted, as well as subsequent endorsers, cease to be obligated.

Article 60.
The holder who refused payment in the order of intermediation loses their right to recourse against those who would be released from liability.

Article 61.
Payment in the order of intermediation must be certified by a receipt made on the order bill, indicating the person for whom payment was made. In the absence of such indication, it is considered that payment was made for the drawer. The order bill and protest, if one was made, must be delivered to the person who made payment in the order of intermediation.

Article 62.
The person who made payment in the order of intermediation acquires rights arising from the order bill against the person for whom they paid, and against those who are liable to this last person by the order bill. However, they cannot re-endorse the order bill. Endorsers following the person who put their signature on the bill and for whom payment was made are released from liability. In the event of competition of several proposals for payment in the order of intermediation, preference is given to the one who releases the largest number of persons from liability. The intermediary, knowing that they violate this rule, loses their right to recourse against those who turned out to be released from liability.

Chapter 9. ON MULTIPLICITY OF COPIES AND ON COPIES

1. MULTIPLICITY OF COPIES

Article 63.

An order bill may be issued in several identical copies.
These copies must be equipped with consecutive numbers in the text of the document itself; otherwise, each of them is considered a separate order bill.
If the bill does not indicate that it is issued in a single copy, then the holder may demand issuance of several copies for their account. For this, they must appeal to their immediate endorser, who is obliged to assist them with respect to their endorser, and so on, ascending to the drawer. Endorsers are obliged to reproduce endorsements on new copies.

Article 64.
Payment made on one copy releases from liability, even if it was not stipulated that this payment extinguishes other copies. However, the payer continues to be liable on each copy accepted by them and not returned to them. An endorser who transferred copies to various persons, as well as subsequent endorsers, are obligated on all copies on which their signature exists and which were not returned.

Article 65.
The person who sent one of the copies for acceptance must indicate on the other copies the name of the person in whose hands this copy is located. This last person is obliged to deliver it to the lawful holder of another copy. If they refuse to do this, the holder may exercise the right of lawsuit only after certification by protest of the following:
1) that the copy sent for acceptance was not transferred to them despite their request;
2) that acceptance or payment could not be obtained on another copy.

2. COPIES

Article 66.
Each holder of an order bill has the right to make copies from it.
The copy must exactly reproduce the original with endorsements and all other notes found on it. It must indicate up to what point it is carried.
It may be endorsed and avaled in the same order and with the same consequences as the original.

Article 67.
The copy must indicate the person in whose hands the original document is located.
The latter is obliged to deliver the specified document to the lawful holder of the copy.
If they refuse to do this, the holder may exercise the right of recourse against endorsers or avalists only after certification by protest that the original was not transferred to them despite their request. If on the original document after the last endorsement made before copying, there is a clause: "from here endorsement is valid only on the copy" or any other equivalent formula, then the endorsement placed after this on the original is invalid.

Chapter 10. ON CHANGES

Article 68.

In the event of changes to the text of the order bill, persons who put their signatures after this change are liable in accordance with the content of the changed text; persons who put their signatures before this are liable in accordance with the content of the original text.

Chapter 11. ON STATUTE OF LIMITATIONS

Article 69.
Lawsuit claims arising from an order bill against the acceptor are extinguished upon expiration of three years from the day of the payment due date.
Lawsuit claims of the holder against endorsers and against the drawer are extinguished upon expiration of one year from the day of the protest made within the established term, or from the day of the payment due date in the case of the clause on circulation without expenses. Lawsuit claims of endorsers against each other and to the drawer are extinguished upon expiration of six months, counting from the day on which the endorser paid the bill, or from the day of presentation to them of a lawsuit. In the event of loss of right or expiration of the statute of limitations, the right of lawsuit against the drawer who did not ensure coverage, or against the drawer or endorser who enriched themselves unlawfully, or against the acceptor who received coverage or enriched themselves unlawfully, is preserved. The running of the statute of limitations term may be suspended in accordance with the current legislation of the Republic of Kazakhstan.

Article 70.
Interruption of limitation has force only with respect to the person against whom the action exceeding the limitation was committed.

Chapter 12. GENERAL PROVISIONS

Article 71.
Payment on an order bill, the due date of which falls on a legally established non-working day, may be demanded only on the first following working day. Likewise, all other actions relating to the order bill, in particular, presentation for acceptance and protest, may be performed only on a working day. If any of these actions must be performed within a certain term, the last day of which is a legally established non-working day, then such term is prolonged to the nearest working day after the expiration of the term. Non-working days falling during the period of running of the term count towards the term. Non-working days are equated to working days recognized as non-working in accordance with the current legislation of the Republic of Kazakhstan.

Article 72.
In terms established by law or in the bill, the day from which the term begins to run is not included.

Article 73.
No grace days, neither by law nor judicial, are permitted.

Chapter 13. ON SIMPLE BILL

Article 74.

A simple bill contains:
1) the designation "bill" included in the text itself and expressed in the language in which this document is drawn up;
2) an unconditional promise to pay a specified sum of money;
3) an indication of the due date;
4) an indication of the place where payment must be made;
5) the name of the person to whom or to whose order payment must be made;
6) an indication of the date and place of drawing of the bill;
7) the signature of the person who issues the document (drawer).
Article 75.
A document in which any of the designations indicated in the preceding article is missing does not have the force of a simple bill, except in the cases defined in the paragraphs below.
A simple bill for which the due date is not indicated is considered payable on presentation.
In the absence of a special indication, the place of drawing of the document is considered the place of payment and also the domicile of the drawer.
A simple bill that does not indicate the place of its drawing is considered to be signed in the place indicated next to the name of the drawer.
Article 76.
To a simple bill apply, insofar as they are not incompatible with the nature of this document, the provisions relating to a bill of exchange and concerning:
endorsement (Articles 10-19); due date (Articles 32-36); payment (Articles 37-41); action in case of non-acceptance or non-payment (Articles 42-49, 51-53); payment by intervention (Articles 54, 58-62); copies (Articles 66, 67); alterations (Article 68); limitation (Articles 69, 70); non-working days, calculation of terms and prohibition of days of grace (Articles 71, 72, 73). To a simple bill also apply the provisions relating to a bill of exchange payable at a third party or in a place other than the domicile of the drawee (Articles 4 and 26), the interest clause (Article 5), discrepancies in the designations of the sum to be paid (Article 6), the consequences of placing any signature under the conditions provided for in Article 7, the consequences of the signature of a person who acts without authority or in excess of their authority (Article 8). Likewise, to a simple bill apply the provisions regarding aval (Articles 29-31); in the case provided for in the last paragraph of Article 30, if the aval does not indicate for whom it is given, it is considered to be given for the drawer of the simple bill.
Article 77.
The drawer of a simple bill is liable in the same way as the acceptor of a bill of exchange.
Simple bills payable at a certain time after presentation must be presented to the drawer for notation within the terms indicated in Article 22. The term from presentation runs from the date of the notation signed by the drawer on the bill. The drawer's refusal to make a dated notation is satisfied by protest (Article 24), the date of which serves as the starting point for the term from presentation.

Section II
PROCEDURE FOR BILL CIRCULATION IN THE REPUBLIC OF KAZAKHSTAN
Chapter 14. GENERAL PROVISIONS
Article 78
Bill circulation in the Republic of Kazakhstan is the totality of relations arising from the issuance of simple and commercial bills of exchange on the territory of the Republic of Kazakhstan, the transfer of claim rights under bills, including those issued outside the Republic of Kazakhstan, the performance of obligations under such bills and related operations, their accounting by accounting firms, as well as the issuance of simple and bills of exchange by central and local executive bodies of the Republic of Kazakhstan. Central executive bodies issue simple and bills of exchange on the basis of a decision of the Government of the Republic of Kazakhstan.
Article 79
Relations regarding bill circulation in the Republic of Kazakhstan are regulated by the Geneva Bill Conventions, as well as by the legislation of the Republic of Kazakhstan, consisting of this Law, other legislative acts of the Republic of Kazakhstan, and regulatory legal acts of the National Bank of the Republic of Kazakhstan issued in accordance therewith. The National Bank of the Republic of Kazakhstan develops and approves regulatory legal acts in the field of bill circulation in accordance with the purpose and objectives of this Law and the legislation of the Republic of Kazakhstan. The list of sub-legislative regulatory legal acts adopted by the National Bank of the Republic of Kazakhstan in accordance with the laws of the Republic of Kazakhstan on matters within its competence is determined in the regulations on the National Bank of the Republic of Kazakhstan.
Article 80
A bill obligation arises from the moment the drawer transfers a properly executed bill. A commercial bill is issued for deferred payment under contracts of sale, performance of work, provision of services (excluding financial services). A bill obligation is valid if the bill is drawn up in accordance with the requirements established by Articles 1 - 9 of this Law.
Article 81.
An allonge together with a bill constitute a single document.
The allonge must contain an inscription that allows unambiguous determination of the allonge's belonging to a specific bill. An allonge may be attached to the bill in such a way that the endorsement begins on the bill itself and ends on the allonge.
Article 82.
The amount of the bill is the sum of money for which it is drawn. The amount of the bill does not include interest indicated therein, penalties, and other costs associated with bill operations.
The currency of a bill issued on the territory of the Republic of Kazakhstan is tenge.
The circulation of a bill in foreign currency, issued by a resident of the Republic of Kazakhstan for operations with non-residents of the Republic of Kazakhstan, is permitted on the territory of the Republic of Kazakhstan.
Article 83.
Banks and organizations carrying out certain types of banking operations, if they have the appropriate license, are entitled to carry out the following types of operations with bills:

acceptance of bills for collection; provision of services for payment of bills by the drawee; payment of domiciled bills; acceptance of bills by intervention.
Operations for bill accounting are carried out only by accounting firms.
Banks are entitled to aval bills only if they have a license for issuing bank guarantees providing for performance in monetary form.
Article 83-1.
Bills on the territory of the Republic of Kazakhstan may be issued on ordinary and bill paper.
The requirements for the security features of bill paper produced on the territory of the Republic of Kazakhstan or imported into its territory, as well as the technical requirements for bill paper, are established by the National Bank of the Republic of Kazakhstan. In case of issuing a bill on bill paper, the text of such a bill must be drawn up in the state and Russian languages. Additional use of other foreign languages is allowed.
Chapter 15. FUNCTIONS OF A BILL AS A MEANS OF PAYMENT AND CREDIT
Article 84.
Legal and natural persons on the territory of the Republic of Kazakhstan are entitled to use simple and bills of exchange in settlements among themselves, provided that this is stipulated in the relevant contract and does not contradict this Law. Settlements with bills through accounting firms are carried out in the manner established by the National Bank of the Republic of Kazakhstan. The procedure for sending bills accepted for collection by communication institutions is determined by regulatory legal acts of the authorized body of the Republic of Kazakhstan, issued in agreement with the National Bank of the Republic of Kazakhstan, and by an agreement between the communication institution and the accounting firm.
Article 85. Excluded by Law of the Republic of Kazakhstan dated 09.07.03 No. 482-II
Article 86.
Acceptance of bills by accounting firms by endorsement before the due date with payment of the bill amount to the presenter of the bill is called bill discounting. The accounting firm is entitled to retain a discount from the bill amount, which is set independently by the accounting firm. The procedure for bill discounting, as well as the carrying out of operations with bills by banks and organizations carrying out certain types of banking operations, are established by regulatory legal acts of the National Bank of the Republic of Kazakhstan.
Article 87. Excluded by Law of the Republic of Kazakhstan dated 09.07.03 No. 482-II
Article 88.
Bill coverage means the establishment by the drawer of such relations with the person indicated in the bill as the drawee, by virtue of which the drawer has the right to demand performance of any obligations by the drawee. In this case, the amount of such obligation must not be less than the amount of payment under the bill. The bill holder has the right to demand bill coverage from the drawer. The drawer is obliged to ensure bill coverage by the due date.

Article 89.
Securing the payment of a letter of credit, the return of a bank loan by pledging a bill is carried out in the manner established by the National Bank of the Republic of Kazakhstan.
The transfer of a bill as a pledge is carried out in compliance with the requirements for the execution of an endorsement.
In other cases, pledging a bill is not allowed.
Pledging of bills and registration of such transactions on the territory of the Republic of Kazakhstan are carried out through the relevant accounting firms.
Chapter 16. CIRCULATION OF NON-RESIDENT BILLS OF THE REPUBLIC OF KAZAKHSTAN, OPERATIONS WITH BILLS IN FOREIGN CURRENCY
Article 90.
The circulation of bills issued by non-residents of the Republic of Kazakhstan on the territory of the Republic of Kazakhstan is regulated by the bill legislation of the Republic of Kazakhstan.
A bill obligation accepted by a resident of the Republic of Kazakhstan outside the Republic of Kazakhstan will be valid on the territory of the Republic of Kazakhstan only if all the requirements of the bill legislation of the Republic of Kazakhstan have been complied with.
Article 91.
The currency exchange rate of the bill is determined according to the rate of such currency established by the accounting firm serving the drawee or having discounted the bill.
Article 92.
A remittance (rimessa) can only be used by an accounting firm licensed by the National Bank of the Republic of Kazakhstan to conduct currency operations, in mutual settlements with a non-resident of the Republic of Kazakhstan.
Chapter 16-1. Excluded in accordance with Law of the Republic of Kazakhstan dated 09.07.03 No. 482-II
Chapter 17. LIABILITY FOR VIOLATION OF BILL LEGISLATION
Article 93.
Protest for non-acceptance or non-payment of a bill is made by a notary within one working day from the moment the bill is presented to him by making a corresponding inscription on it and drawing up a written act certifying the fact of non-acceptance or non-payment. Protest for non-dating of acceptance must be made in the manner and within the terms established for making a protest for non-acceptance of a bill.
Article 94.
Enforcement against the property of the drawee of a bill is carried out only on the basis of a court order or court decision.
The court is not entitled to consider the terms of the contract that served as the basis for issuing the bill, except in cases where the bill was recognized as invalid.
In cases where the bill was drawn up with violations of the requirements established by Articles 1 and 74 of this Law, the bill is recognized as invalid. In case of a dispute arising from obligations stemming from an invalid bill, the dispute is considered as a case of breach of obligations under the contract specified in the second paragraph of this article.
Article 95.
The issuance of accommodation, fictitious, and financial bills is prohibited on the territory of the Republic of Kazakhstan.
The risk of non-payment for an accommodation or fictitious bill is borne by the bill holder who presented the accommodation or fictitious bill.
Legal and natural persons are obliged to immediately report facts of presentation of fictitious bills to the relevant law enforcement agencies.
A person guilty of issuing an accommodation, fictitious, or financial bill bears responsibility in accordance with the laws of the Republic of Kazakhstan.
Article 96.
The risk of loss of a bill is borne by the bill holder. The loss of a bill by the bill holder entails the loss of the right of claim under it, except in cases where the drawer acknowledged the issuance of the lost bill. Payment for a lost bill can also be made provided that the right of claim under it is restored by court order. An application for restoration of a right under a lost bill is considered by the court in the manner prescribed by the current legislation of the Republic of Kazakhstan. The issuance of a replacement bill and the restoration of endorsements on the bill are carried out at the expense of the bill holder who lost it. A person obliged to deliver a bill is liable for the loss of the bill from the moment it is accepted for dispatch until its delivery to the addressee. In case of loss of the bill, they are obliged to compensate the bill holder or the accounting firm that performed operations for collecting the lost bill for all expenses related to the restoration of rights under such a bill.
Article 97. Excluded by Law of the Republic of Kazakhstan dated 09.07.03 No. 482-II
Chapter 18. Excluded by Law of the Republic of Kazakhstan dated 09.07.03 No. 482-II
President
Republic of Kazakhstan N. NAZARBAYEV