Under the Law of the Republic of Kazakhstan "On Rehabilitation and Bankruptcy," a debtor is entitled to pursue debt restructuring in cases of temporary insolvency, provided that no court-ordered rehabilitation or bankruptcy proceedings have been initiated. To begin this process, the debtor must file an application with the court, supported by documentation evidencing their temporary insolvent status.

Once the court issues a decision to apply the debt restructuring procedure, the debtor is strictly prohibited from entering into any transactions involving the alienation of property.

The debtor is required to reach a formal debt restructuring agreement with all creditors within two months of the court's decision taking effect.

The agreement must clearly outline the terms of the settlement, as well as the specific procedures, methods, and timelines for the debtor to fulfill their obligations to the creditor(s). A debt restructuring agreement is legally limited to a maximum term of three years.

Once the debt restructuring agreement is approved by the court, the following legal consequences take effect immediately upon the entry into force of the court ruling:

• The accrual of interest (penalties, and fines) on all restructured debts is officially suspended;

• -All restrictions of state bodies on the debtor's accounts are removed without making appropriate decisions of the bodies that imposed them.;

• The execution of previously adopted court decisions and arbitral awards is terminated, with the exception of payments to citizens to whom the debtor is responsible for causing harm to life or health, without taking into account claims for compensation for moral damage, the deadline for payment of which came after the conclusion of an agreement on debt restructuring;

• The imposition of new arrests on the debtor's property and other restrictions on the disposal of their property is allowed only in cases of claims for invalidation of the transaction and the recovery of property from someone else's illegal possession brought against the debtor.

In 2024, within the East Kazakhstan Region, a total of six enterprises underwent debt restructuring procedures involving a cumulative debt of 2.3 billion tenge. To date, five of these enterprises are consistently repaying their debts in accordance with the court-approved schedules. For the remaining enterprise, the procedure was terminated due to a failure to fulfill the repayment requirements.

Source : https://www.gov.kz/memleket/entities/kgd-vko/press/news/details/1159905?lang=kk