91. Review of agents, nominees and custodians, etc.
(1) While the agent, nominee or custodian continues to act for the Trust, it shall be the duty of the Trustees:
(a) to keep under review the arrangements under which the agent, nominee or custodian acts and the manner in which such arrangements are being put into effect;
(b) if circumstances make it appropriate to do so, to consider whether there is a need to exercise any power of intervention that they have; and
(c) if they consider that there is a need to do so, to exercise the power of intervention.
(2) If the agent has been authorised to exercise asset management functions, the duty under subsection 91(1) shall include, in particular:
(a) a duty to consider whether there is any need to revise or replace the policy statement made for the purposes of section 84 (Asset management — special restrictions);
(b) if the Trustees consider that there is a need to revise or replace the policy statement, a duty to do so; and
(c) a duty to assess whether the policy statement (as it has effect for the time being) is being complied with.
(3) Section 84(3) (and (4) (Asset management — special restrictions) shall apply to the revision or replacement of a policy statement under this section as they apply to the making of a policy statement under that section.
(4) In this section, “power of intervention” includes:
(a) a power to give directions to the agent, nominee or custodian; and
(b) a power to revoke the authorisation or appointment of the agent, nominee or custodian.
92. Liability for agents, nominees and custodians, etc.
(1) A Trustee shall not be liable for any act or default of the agent, nominee or custodian unless he fails to comply with the any of the duties applicable to him under chapter 1 of Part 8 when:
(a) entering into the arrangements under which the person acts as agent, nominee or custodian; or
(b) carrying out his duties under section 91 (Review of agents, nominees and custodians, etc.).
(2) If a Trustee has agreed to a term under which the agent, nominee or custodian is permitted to appoint a substitute, the Trustee shall not be liable for any act or default of the substitute unless he has failed to comply with the any of the duties applicable to him under chapter 1 of Part 8:
(a) when agreeing to that term; or
(b) when carrying out his duties under section 91 (Review of agents, nominees and custodians, etc.) in so far as they relate to the use of the substitute.
93. Effect of Trustees exceeding their powers
A failure by the Trustees to act within the limits of the powers conferred by this Part:
(1) in authorising a person to exercise a function of theirs as an agent; or
(2) in appointing a person to act as a nominee or custodian,
shall not invalidate the authorisation or appointment.
94. Remuneration and expenses of agents, nominees and custodians
(1) This section shall apply if, under a power conferred by Part 10 or any other written law, or by the Trust Instrument, a person other than a Trustee has been:
(a) authorised to exercise functions as an agent of the Trustees; or
(b) appointed to act as a nominee or custodian.
(2) The Trustees may remunerate the agent, nominee or custodian out of the Trust funds for services if:
(a) he is engaged on terms entitling him to be remunerated for those services; and
(b) the amount does not exceed such remuneration as is reasonable in the circumstances for the provision of those services by him to or on behalf of that Trust.
(3) The Trustees may reimburse the agent, nominee or custodian out of the Trust funds for any reasonable expenses properly incurred by him in exercising functions as an agent, nominee or custodian.
Part 11: RESERVED AND RESTRICTED POWERS, EXPRESSIONS OF WISHES, AND INCAPACITATION
95. Reserved and restricted powers
(1) Without prejudice to the generality of section 37 (Variation and revocation of a Trust), the reservation by the Settlor to himself or grant to any other person in the Trust Instrument of an AIFC Trust of any limited Beneficial Interest in the Trust Property whether of Income or capital, or any or all of the powers specified in subsection 95(2) (or both such an interest and any or all of such powers) shall not:
(a) invalidate the Trust; or
(b) prevent the Trust taking effect according to its terms; or
(c) cause any or all of the Trust Property, or the interests or powers reserved, to be part of the real estate or personal estate of the Settlor for any purpose.
(2) The powers referred to in subsection 95(1) are:
(a) in the case of a reservation to the Settlor or other donor of Trust Property, power to revoke the Trusts in whole or in part;
(b) power to vary or amend the terms of the Trust Instrument or any of the Trusts, purposes or powers arising thereunder in whole or in part;
(c) a general, intermediate or special power to advance, appoint, pay, apply, distribute or transfer Trust Property (whether Income or capital or both) or to give directions for the making of any such advancement, appointment, payment, application, distribution or transfer;
(d) power to act as, or give binding directions as to, the appointment or removal of, a director or an officer of any company wholly or partly owned by the Trust or to direct the Trustee as to the manner of exercising voting rights attaching to any of the shares held in such company;
(e) power to give binding directions in connection with the purchase, retention, holding, sale or other commercial or investment dealings with Trust Property or any investment or reinvestment thereof or the exercise of any powers or rights arising from such Trust Property;
(f) power to give binding directions that the Trustee shall not be under any duty nor be bound to interfere in the business of any company to which any such direction applies in which the Trust is interested, the manner in which the Trustee shall act in respect of exercise of any right or power arising from the ownership of the shares of such company or any loan or advance of money to such company, and the liability of the Trustee arising as a result of any such direction;
(g) power to appoint, add, remove or replace any Trustee, Protector, Enforcer or any other office holder;
(h) power to add, remove or exclude any Beneficiary, class of Beneficiaries or purpose;
(і) power to change the Governing Law and the forum for administration of the Trust; and
(j) power to restrict the exercise of any powers, discretions or functions of a Trustee by requiring that they shall only be exercisable with the consent, or at the direction of, any person specified in the Trust Instrument or any other written notice to the Trustee.
(3) A Trustee who:
(a) has acted, or refrained from acting, in compliance with, or as a result of, a valid exercise of any of the powers set out in subsection 95(2), shall not, by reason only of such compliance, commit a Breach of Trust or other fiduciary or equitable duty; or
(b) is or has been prevented from acting in accordance with any of the powers specified in subsection 95(2), or any exercise of those powers by reason of the provisions of any applicable law or because insufficient rights or powers are exercisable by the Trustee in relation to the Trust Property, shall not, by reason only of such non-compliance or failure to act, commit a Breach of Trust or other fiduciary or equitable duty.
(4) No person other than a person in whom Trust Property or an interest in Trust Property is vested and who is formally appointed as a Trustee, shall be or become a Trustee by reason only of the reservation or grant of any of the powers set out in subsection 95(2).
(5) The terms of an AIFC Trust may provide that the reservation or grant of any of the powers set out in subsection 95(2) shall not impose a fiduciary duty on the holder of such powers.
(6) In the absence of any contrary provision of the terms of an AIFC Trust:
(a) in the case of the reservation by a Settlor or the grant to another person of any of the powers specified in section 95(2), where so long as the holder of the power is not the sole Trustee, such powers shall be personal and non-fiduciary; and
(b) in any other case, such powers shall be fiduciary.
96. Expressions of wishes
(1) The Settlor of a Trust may give to the Trustee a letter of the wishes of the Settlor or the Trustee may prepare a memorandum of the wishes of the Settlor with regard to the exercise of any functions conferred on the Trustee by the terms of the Trust.
(2) A Beneficiary of a Trust may give to the Trustee a letter of the wishes of the Beneficiary or the Trustee may prepare a memorandum of the wishes of the Beneficiary with regard to the exercise of any functions conferred on the Trustee by the terms of the Trust.
(3) Where a Trust is in favour of a class of persons, then a member of that class may give to the Trustee a letter of the wishes of that member or the Trustee may prepare a memorandum of the wishes of that member with regard to the exercise of any functions conferred on the Trustee by the terms of the Trust.
(4) Where a letter of wishes or a memorandum of wishes is given to or prepared by the Trustee of a Trust then-
(a) the Trustee may have regard to that letter or memorandum in exercising any functions conferred upon the Trustee by the terms of the Trust; but
(b) the Trustee shall not be bound to have regard to that letter or memorandum and shall not be accountable in any way for failure or refusal to have regard to that letter or memorandum.
(5) No fiduciary duty or obligation shall be imposed on a Trustee merely by the giving to the Trustee of a letter of wishes or the preparation by the Trustee of a memorandum of wishes.
97. Incapacitation of Protector or Settlor
(1) If the Settlor becomes incapacitated then the rights or powers (if any) reserved to him shall during his incapacitation be exercisable by the Protector (if appointed) or by any other person designated by the Trust Instrument or appointed for that purpose by the Court declaring or confirming him to be incapacitated.
(2) If the Protector becomes incapacitated then the rights or powers (if any) reserved to him shall during his incapacitation be exercisable by the person designated by the Trust Instrument or appointed for that purpose by the Court declaring or confirming him to be incapacitated.
(3) For the purpose of this section:
(a) a person shall be deemed to be incapacitated if declared to be of unsound mind by a court of competent jurisdiction or if declared by two qualified examining physicians to be of unsound mind or physically impaired so as to be unable to act responsibly prudently or effectively and shall be deemed to remain incapacitated until declared otherwise by such court or such physicians; and
(b) a corporation shall be deemed to be incapacitated if it has been dissolved, or if it is under administration or a petition for its winding up has been presented in any Court and has not been finally determined by the Court
(4) The Trustee may declare in writing a person to be incapacitated during any period in which the Trustee is of the opinion that such person is unable freely to exercise his rights or powers or to fulfil his duties or obligations hereunder because of duress or undue influence brought to bear on such person by any other person or persons but the Trustee shall not be under any duty to make any inquiries as to whether any person is suffering from duress or undue influence and in any case the Trustee shall not be under any duty to make any declaration as aforementioned.
Part 12: PROVISIONS APPLICABLE TO A FOREIGN TRUST
98. Enforceability of a Foreign Trust
(1) Subject to subsection 98(2), a Foreign Trust shall be regarded as being governed by, and shall be interpreted in accordance with, its Governing Law.
(2) A Foreign Trust shall be unenforceable in the AIFC:
(a) to the extent that it purports:
(і) to do anything which is contrary to AIFC Law; or
(ii) to confer any right or power or impose any obligation the exercise of which is contrary to AIFC Law; or
(b) to the extent that the Court declares that the Trust is contrary to public policy in the AIFC,
but otherwise shall be enforceable in accordance with its terms and its Governing Law.
Interpretation
1. Rules of interpretation
(1) In these Regulations, a reference to:
(a) a statutory provision includes a reference to the statutory provision as amended or re-enacted from time to time;
(b) a person includes any natural person, body corporate or body unincorporate, including a company, partnership, unincorporated association, government or state;
(c) an obligation to publish or cause to be published a particular document shall, unless expressly provided otherwise in these Regulations, include publishing or causing to be published in printed or electronic form;
(d) unless stated otherwise, a day means a calendar day. If an obligation falls on a calendar day which is either a Saturday or Sunday or an official state holiday in the Republic of Kazakhstan, the obligation shall take place on the next calendar day which is a business day;
(e) a calendar year shall mean a year of the Gregorian calendar; and
(f) a reference to the masculine gender includes the feminine.
(2) The headings in these Regulations shall not affect their interpretation.
2. Legislation in the AIFC
AIFC Law is any AIFC Act or law in force in the AIFC.
3. Defined Terms
In these Regulations, unless the context indicates otherwise, the defined terms listed below shall have the corresponding meanings.
| Term | Definition |
| Acting Law of the AIFC | has the meaning given by the Constitutional Statute. |
| AFSA | Astana Financial Services Authority. |
| AIFC | Astana International Financial Centre. |
| AIFC Act | means an act adopted by the AIFC Bodies. |
| AIFC Bodies | has the meaning given by article 9 of the Constitutional Statute and the document entitled The Structure of the Bodies of the Astana International Financial Centre adopted by the Management Council on 26 May 2016. |
| AIFC Co-operation and Exchange of Information Rules | means the rules entitled AIFC Co-operation and Exchange of Information Rules, AIFC Rules No. FR0042 of 2018. |
| AIFC Glossary | means the glossary of terms entitled AIFC Glossary, AIFC Act No. FR0017 of 2018. |
| AIFC Participant | has the meaning given by article 1(5) of the Constitutional Statute. |
| AIFC Trust | means a legal relationship whereby: (a) Trust Property is held by or in the name of a Trustee, and (b) the Trustee is under a fiduciary obligation to administer the Trust (in accordance with its terms) exclusively for the benefit of the Beneficiaries; and (c) the Beneficiaries are identified in or ascertainable in accordance with the terms of the Trust, and (d) the Beneficiaries may be persons (whether in existence or not) or groups of such persons, or persons able to benefit from any valid Charitable Trust or other Purpose Trust. |
| Arbitration Regulations | means the arbitration regulations adopted by the Resolution of the AIFC Management Council, dated 5 December 2017. |
| Authorised Firm for Providing Trust Services | means an AIFC Participant that has been licensed by the AFSA to carry on the regulated activity defined in paragraph 7 of Schedule 1 of the AIFC’s General Rules. |
| Beneficial Interest | means the interest of a Beneficiary under a Trust. |
| Beneficiary | means a person entitled to benefit under a Trust or in whose favour a discretion to distribute Property held on Trust may be exercised. |
| Breach of Trust | means a breach of any duty imposed on a Trustee by these Regulations or by the terms of the Trust. |
| Charitable Trust | means a Trust or portion of a Trust, created for a charitable purpose described in section 35 (Charitable Trusts). |
| Companies Regulations | means the AIFC Companies Regulations No. 2 of 2017, as amended. |
| Collective Investment Scheme Rules | means the AIFC Collective Investment Scheme rules. |
| Constitutional Statute | means the constitutional statute of the Republic of Kazakhstan dated 7 December 2015 entitled On the Astana International Financial Centre. |
| Constructive Trust | means a trust imposed by a Court in accordance with section 69 or otherwise. |
| Court | means the AIFC Court as established under the Constitutional Statute. |
| Discretionary Trust | is a Trust in which the Settlor has delegated complete or limited discretion to the Trustee to decide, amongst other things: (a) when and how much Income or Property is distributed to a Beneficiary; and (b) which of the Beneficiaries may benefit. |
| DNFBP | has the meaning given to it in the AIFC Glossary. |
| Enforce | in relation to a Trust means to require or compel Trustees to execute, carry out and perform their duties under the Trust Instrument in relation to its non-charitable purposes and to bring and prosecute proceedings to enforce the terms of the Trust. |
| Enforcer | shall be construed in accordance with section 36 (Non-Charitable Trusts or Purpose Trusts). |
| Express Trust | is a Trust created with the Settlor’s express intent declared in writing or a written declaration of Trust by the Trustee. |
| Foreign Law | means any law other than AIFC Law. |
| Foreign Trust | is a Trust whose Governing Law is the law of a jurisdiction other than AIFC, including any Trust within the meaning of the Hague Convention. |
| Governing Law | has the meaning given in section 8 (Governing Law). |
| Governor | means the Governor of the Astana International Financial Centre. |
| Hague Convention | means the Convention on the law applicable to Trusts and on their recognition, done at The Hague on 1 July 1985. |
| Heirship Right | means any right, claim or interest in, against or to Property of a person arising, accruing or existing in consequence of, or in anticipation of, that person’s death, other than any such right, claim or interest created by will or other voluntary disposition by such person or resulting from an express limitation in the disposition of the Property of such person. |
| Income | includes rents and profits. |
| Management Council Resolution on AIFC Bodies | means the document entitled The Structure of the Bodies of the Astana International Financial Centre, adopted by resolution of the Management Council on 26 May 2016, as amended by resolution of the Management Council, the Amendments and supplementations to the Structure of the Bodies of the Astana International Financial Centre, adopted on 9 October 2017. |
| Minor | means a person who has not attained the age of majority under the Governing Law of Trust or the law of his domicile. |
| Non-Charitable Trust (or Purpose Trust) | has the meaning given in section 36 (Non-Charitable Trusts or Purpose Trusts). |
| Personal Relationship | includes every form of relationship by blood adoption marriage or cohabitation regardless of whether the law of any jurisdiction recognises the validity, legitimacy or existence of the relationship, including a former personal relationship which has in law or in fact terminated and in particular a personal relationship between two persons exists if: (a) one is the child of the other, natural or adopted, whether or not the adoption is recognised by law, legitimate or illegitimate; (b) one is married to the other, whether or not the marriage is recognised by law; (c) one cohabits with the other or so conducts himself or herself in relation to the other as to give rise in any jurisdiction to any rights, (d) obligations or responsibilities analogous to those of parents and child or husband and wife; or (e) personal relationships exist between each of them and a third person, but no change in circumstances shall cause a personal relationship once established to terminate. |
| Property | means any movable or immovable property, and includes rights and interests, whether present or future and whether vested or contingent. |
| Protective Trust | is a Trust that is designed to protect the Trust Property to ensure the continued support of the Beneficiary. |
| Protector | means any person other than the Settlor upon whom any power is conferred by section 97 (Incapacitation of Protector or Settlor). |
| Purpose Trust | means a Trust or portion of a Trust created for a purpose which is not a charitable purpose as described in section 36 (Non-Charitable Trusts or Purpose Trusts). |
| Regulations | means the AIFC Trust Regulations 2019. |
| Schedule | means a schedule to these Regulations. |
| Settlor | means a person who provides Trust Property or makes a testamentary disposition on Trust or to a Trust. |
| Trust | is a right, enforceable solely in equity, to the beneficial enjoyment of Property to which another person holds the legal title and includes an AIFC Trust and a Foreign Trust. |
| Trust Instrument | means an instrument by which a Trust is created and includes a unilateral declaration of Trust and any instrument varying the terms of the Trust. |
| Trust Property | means the Property for the time being held in Trust. |
| Trustee | means a person appointed to act as a Trustee of a Trust or holding office as such in accordance with the provisions of these Regulations. |
Schedule 1
Application of the Arbitration Regulations
1. The Arbitration Regulations shall apply and be construed with respect to a Trust arbitration, as stated hereunder.
2. In the Arbitration Regulations, "dispute" includes an administration question.
3. Section 15(1) (Definition and form of arbitration agreement) of the Arbitration Regulations shall apply as if it read -
The Settlor of a Trust shall be free to determine (by provision in the Trust Instrument) how, in relation to a Trust, disputes are resolved, subject only to such safeguards as are necessary in the public interest;".
4. Where in the Arbitration Regulations reference is made to a matter agreed between the parties to an arbitration agreement (including a matter which may be authorised, chosen, conferred, designated, nominated or vested by the parties) that matter shall (except where no effective provision is made) be determined as provided in the Trust Instrument.
5. Neither section 15 (Definition and form of arbitration agreement) of the Arbitration Regulations nor any rule of law or construction treating an arbitration agreement separate to any agreement of which it is a part shall apply in relation to a Trust arbitration.
6. The term "action" in section 16 (Arbitration agreement and substantive claim before a court) of the Arbitration Regulations includes an application or other reference to the Court concerning an administration question which the Trust Instrument requires to be submitted to arbitration and a stay of that application or other reference may be sought by any of the parties in relation to the Trust, whether or not a party to that application or other reference.
7. In any application or other reference to the Court referred to in paragraph 6, the Court may stay the proceedings on its own volition unless all parties in relation to the Trust affected by the application are before it or are represented by persons before it.
8. Section 41 (Form and contents of award) of the Arbitration Regulations shall apply as if it included the following sections:
"(5) Where a person is or has been a party to a Trust arbitration in the capacity of Trustee he shall, unless the tribunal otherwise orders, be entitled to the costs of the arbitration, in so far as they are not recovered from or paid by any other person, out of the fund held by the Trustee; and the tribunal may otherwise order only on the ground that the Trustee has in substance acted for his own benefit rather than for the benefit of the Trust.
"(6) Where a person is or has been a party to a Trust arbitration in the capacity of Trustee and is entitled to be paid his costs out of the fund held by the Trustee any doubt as to whether costs were reasonably incurred shall be resolved in favour of the Trustee. Costs shall be presumed to have been unreasonably incurred if they were incurred contrary to the duty of the Trustee."
9. For the purposes of enforcing an arbitral award under section 44(2)(a)(iii) (Application for setting aside as exclusive recourse against arbitral award) of the Arbitration Regulations, the term "dispute" includes an administration question.
