Some Aspects of the Legal Regulation of the Refined Products Market. Vladimir Karatitsky. Published: Petroleum № 3, June 2003

Some Aspects of the Legal Regulation of the Refined Products Market

Since July 1, 2003, the Law of the Republic of Kazakhstan № 492-II of April 7, 2003 "On state regulation of production and turnover of certain kinds of refined products" will come into effect. But already now its possible to predict that prior to its introduction and after it, many changes and amendments will be introduced in it. Most likely that these changes will concern the powers and hierarchy of the state management bodies, which are involved in the state regulation of the market of production and turnover of refined products. The total number of the state bodies regulating the market of refined products in Kazakhstan comprises seven, a number rather honored in the East. However, close analysis of the law provisions recollects in memory a well-known saying "Too many cooks spoil the broth".

The main body of state management, according to the logic of lawmakers, should be the authorized body - a state body determined by the government of the Republic of Kazakhstan, which shall regulate production and turnover of refined products within the competence determined by the Law (subpoint 15, Article 1 of the Law). However, this competence leaves much to be desired.

According to Article 3 of the Law, the state regulation of production and turnover of refined products is carried out by the government of the RК and the authorized body.

Other state bodies have the right to regulate certain issues on production and (or) turnover of refined products within the competence determined by the Law and other legislative acts of the Republic of Kazakhstan.

By the date of preparing this article, the authorized body was unknown. However, it can be assumed with certainty that it will be the Ministry of Energy and Mineral Resources of the RK. Due to its competence determined by the Law, the Ministry stands aside from other state bodies, even having no yet the powers of the "authorized body". Of certain significance is point 2 of Article 3, according to which the state regulation of production and turnover of refined products includes:

1) licensing of the activities on production of refined products;

2) establishment of the minimal volumes of refined products production under approval by the state body in the field of energy of the supply volumes of crude oil and (or) gas condensate;

3) control over the turnover of refined products within the competence of the government of the RК, the authorized and other state bodies determined by it; monitoring through the uniform database on production and turnover of refined products; preparing accompanying invoices and establishing declaration procedures;

4) control over the quality of refined products.