Kazakhstan is preparing a broad overhaul of its capital market. The government-backed reform package includes 35 initiatives ranging from IPO incentives and new corporate structures to securities lending, digital financial assets and sovereign Islamic securities, DKNews.kz reports.
The measures are included in the draft Capital Market Development Program for 2026–2030, published by Kazakhstan’s Agency for Regulation and Development of the Financial Market. The program was developed on the instructions of the President jointly with the National Bank of Kazakhstan, market participants and the expert community.
The proposals span seven policy areas and are designed to make market-based financing more accessible not only to major corporations, but also to small and medium-sized businesses.
SMEs could get a dedicated sponsor to guide them to the stock market
One of the more distinctive proposals is the creation of a listing sponsor institution for small and medium-sized enterprises seeking access to the equity market.
A listing sponsor would assess whether a company is ready to become public, develop a preparation program and coordinate the work of investment banks, auditors and legal advisers.
The sponsor’s role would continue after listing. It would assist the issuer with disclosure requirements and investor relations, while also bearing responsibility before the exchange and the regulator for the quality of the company’s preparation.
Dedicated requirements covering professional qualifications, internal controls and accreditation would apply to listing sponsors.
For smaller companies, the change could significantly alter the route to an IPO. Instead of assembling and coordinating multiple advisers on their own, issuers would have a professional market participant overseeing the process.
IPO-related costs could become tax deductible
Kazakhstan is also considering tax incentives to reduce the cost of going public.
The program proposes examining whether expenses directly related to the preparation and execution of an IPO could be deducted for tax purposes. Eligible costs could include fees paid to investment banks, auditors and legal advisers.
Another proposal is a temporary reduction in the corporate income tax rate for listed companies that maintain a required free-float level.
The amount of support would be linked to the parameters of the offering and its contribution to secondary-market liquidity.
In other words, merely completing an IPO would not necessarily be enough to receive the full incentive. The actual proportion of shares available for public trading would also matter.
Kazakh investors could join overseas IPOs through KASE or AIX
The government also wants to make it easier for domestic investors to participate when a Kazakh company lists its securities abroad.
Instead of requiring a fixed minimum share of an offering to be placed locally, issuers could be required to provide investors in Kazakhstan with an opportunity to participate through KASE or AIX on terms comparable to those offered internationally.
KASE is the Kazakhstan Stock Exchange, while AIX is the Astana International Exchange based at the Astana International Financial Centre.
The actual size of the domestic tranche would then depend on investor demand rather than a predetermined quota.
Retail investors would retain priority in state-company IPOs
A separate approach is proposed for companies in Kazakhstan’s quasi-public sector.
For IPOs and secondary public offerings, a mandatory domestic tranche would remain in place. A minimum portion would initially be reserved for retail investors, with allocation rules disclosed in advance.
If demand from the public is particularly strong, the retail tranche could be increased. Any unallocated portion could then be offered to other categories of investors.
The model effectively creates two approaches: greater flexibility for privately owned businesses, while preserving specific safeguards for local retail participation in offerings by state-related companies.
A new corporate form could sit between an LLP and a full joint-stock company
Another notable proposal is the introduction of a simplified form of non-public joint-stock company.
It would occupy an intermediate position between a limited liability partnership, or LLP — one of the most common corporate structures in Kazakhstan — and a fully fledged public joint-stock company.
Such a company could issue different classes of shares, use convertible instruments and introduce employee stock-option programs, while facing more flexible requirements for minimum capital and corporate governance.
A board of directors would not be mandatory until the company reaches specified thresholds for size and number of shareholders.
A significant portion of corporate relations could be governed through the charter and shareholder agreements, while the shareholder register could be maintained electronically through the Central Securities Depository or a registrar.
Public share offerings would only become possible after the company converts into a full joint-stock company.
In practice, this could create a new growth path for businesses: LLP, then non-public joint-stock company, and eventually a public company.
Investment funds could become easier for retail investors to compare
Another pillar of the reform concerns the collective investment market.
A new law on investment funds is expected to create conditions for the development of money-market funds, bond and index funds, real estate funds, as well as sector-specific and thematic strategies.
At the same time, the authorities propose introducing a standardized key-information document for investment products.
Before purchasing a product, an investor would receive a short document in a standard format containing information on the investment strategy, risk level, historical returns, liquidity and fees.
The aim is to allow investors to compare products offered by different asset managers using the same set of indicators, rather than focusing solely on advertised returns.
Foreign investors may no longer need to repeat client checks in Kazakhstan
The program also seeks to simplify foreign investors’ access to Kazakh equities through international depository infrastructure.
Investors could use familiar international mechanisms for settlement, receiving dividends, voting and participating in corporate actions.
The proposals also include the use of electronic documents and electronic apostilles, remote identification and recognition of client due-diligence checks carried out by an international depository or global custodian.
If anti-money laundering and counter-terrorist financing requirements are satisfied, equivalent procedures would not have to be repeated at the local level.
For international investors, that could reduce duplication and administrative friction when entering the Kazakh market.
Kazakhstan’s pension fund could lend securities to the market
To increase secondary-market activity, the authorities propose creating a centralized securities-lending mechanism.
Long-term institutional investors, including Kazakhstan’s Unified Accumulative Pension Fund, or UAPF, investment funds and insurance companies, could temporarily lend securities they already hold to other market participants and earn additional income.
Borrowers could use those securities for covered short selling, risk hedging and arbitrage transactions.
The distinction is important: the securities would have to be borrowed first. The proposal does not concern naked short selling.
A dedicated market infrastructure would be required, along with changes to tax treatment so that lending a security and subsequently returning it are not treated as separate outright sale-and-purchase transactions.
Market makers would be judged by measurable liquidity metrics
The program also proposes a separate, proportionate regulatory regime for market makers, reflecting the fact that they take market risk onto their own balance sheets.
Their performance would be assessed against measurable indicators including average bid-ask spreads, order-book depth, the duration of two-way quotes and the amount of liquidity provided.
Economic incentives would then depend on actual performance against those metrics.
The mechanism could be particularly relevant for less actively traded securities, where a continuous presence of buy and sell orders can make it easier for investors to enter or exit positions.
More analyst coverage is planned for mid-sized companies
Kazakhstan also wants to address the shortage of regular investment research on companies outside the country’s largest listed names.
The program proposes developing sponsored research coverage for mid-sized issuers.
At the same time, requirements would be introduced to protect the independence of analytical conclusions and manage potential conflicts of interest.
Corporate disclosures are also expected to move toward a unified pool of standardized corporate data, making them suitable for automated processing and the production of analytical materials.
Loan portfolios could be transformed into tradable bonds
The program also includes measures to develop securitization.
The mechanism allows loan portfolios to be transformed into tradable bonds, potentially freeing up resources for new lending.
The authorities plan to strengthen the legal framework governing asset transfers if the original lender becomes insolvent, standardize portfolio-composition requirements, improve disclosure on asset quality and create a backup mechanism for payment servicing.
The original creditor would also be required to retain part of the risk associated with the transferred portfolio.
Tax rules are expected to be structured so that the transaction remains neutral throughout its various stages.
Digital financial assets are moving toward permanent regulation
A separate set of reforms concerns the further development of digital financial assets.
The authorities are considering rules to establish finality of settlement, define how platform operators interact with banks and market infrastructure, and set conditions for projects to move from a regulatory sandbox into a permanent operating regime.
The program would also clarify protections for non-qualified investors and limits on how much they can invest.
Digital assets are already moving beyond the experimental stage in Kazakhstan. We previously examined how tokenized instruments differ from conventional shares and what rights investors may receive.
Kazakhstan plans to broaden its sustainable-finance taxonomy
In the field of sustainable finance, Kazakhstan plans to create a unified national classification for eligible projects and bring KASE and AIX rules closer to internationally recognized principles.
The existing green taxonomy would be expanded to include approaches for classifying social projects.
The program also calls for stronger ESG disclosure, independent verification and specific requirements for investment funds that market themselves as sustainable.
The objective is to tie the use of ESG and “green” labels more closely to defined criteria rather than leaving them primarily to issuer marketing.
Sovereign Islamic securities could create a benchmark for the market
Islamic finance is another area singled out for development.
To enable the issuance of sovereign Islamic securities, Kazakhstan plans to define their status in the Budget Code and establish rules governing the use of state property in the issuance structure.
A sovereign transaction could then create a yield benchmark for corporate Islamic instruments.
The authorities also propose unified requirements for Sharia governance and review, as well as tax neutrality for multi-stage issuance structures.
The initiative could be particularly significant for Kazakhstan’s relatively small Islamic-finance market. We previously looked at the obstacles limiting the sector’s growth and why sovereign sukuk could matter for its development.
All 35 initiatives would be phased in through 2030
The reforms are not expected to be introduced all at once.
The financial regulator says the measures would be implemented gradually, with regular assessment of both outcomes and emerging risks.
If carried out as proposed, the changes would affect almost every part of Kazakhstan’s capital-market ecosystem: from a small company preparing for its first share issue to a foreign fund buying Kazakh equities, as well as pension assets, digital financial instruments and Islamic finance.
The scale of the program is reflected in a single number: 35 separate initiatives across seven policy areas.
We previously reported on Kazakhstan’s plans to simplify the process for companies entering the stock market. The latest proposals show that the reform is intended to go much further than IPO procedures alone, extending to how businesses raise capital, how securities trade in the secondary market and how investors access new financial instruments.
