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Commentary to article 110. Association of legal entities in the form of an association (union) The Civil Code of the Republic of Kazakhstan
Associations of legal entities may be established only in the form of an association or union, indicating their organizational and legal form in the name of the legal entity and its constituent documents.
Terminologically, the strict distinction between an association and a union is not defined by the Civil Code. Usually, an association is called an association of persons of the same type of activity, and a union is an association for any joint purposes.
Commercial and non-profit organizations may be members of the same association (see paragraph 1 of the new edition of the commented article).
A legal entity may be a member of several associations.
The Association (union) is a legal entity.
The Association (union) is a non-profit organization. An association of legal entities with the main purpose of generating income should be formed in the form of an economic partnership.
The founding documents of the association (union) are the founding agreement and the charter.
The constituent documents of the association (union) must contain, in addition to the information specified in clauses 4, 5 of Article 41 of the Civil Code, conditions on the composition and competence of the governing bodies of the association (union) and the procedure for their decision-making, including on issues on which decisions are taken unanimously or by a qualified majority of votes of the members of the association (union), and the procedure for the distribution of property remaining after the liquidation of the association (union).
The property of an association (union) is formed by contributions from its members, its own activities and other legitimate income. The property transferred by the members of the association to the association (union) becomes its property.
The association (union) is the owner of the property on its balance sheet. The property of the association (union) is subject to the legal regime of private ownership.
An association (union) may establish an enterprise independently or with other legal entities. In this case, the company will be the owner of the property transferred to its authorized capital, and can only be formed in the form of a business partnership. The association (union), being the founder, retains only binding rights to the transferred property.
The members of the association (union) bear subsidiary responsibility for its obligations only if its size and procedure are stipulated in the constituent documents of the association (union). That is, the absence of an indication in the constituent documents of additional responsibility exempts the members of the association (union) from it.
A member of the association (union) has the right, at his discretion, to withdraw from the association (union) at the end of the financial year. In this case, he bears subsidiary responsibility for the obligations of the association (union) in proportion to his contribution during the period stipulated in the constituent documents. The length of the fiscal year is usually set in the constituent documents and may coincide with the length of the calendar year.
Withdrawal from an association (union) does not give the right to refund contributions made by the outgoing member, unless otherwise provided by the constituent documents of the association.
A member of an association (union) may be excluded from it by decision of the remaining members in the cases and in accordance with the procedure established by the constituent documents of the association (union). The rules relating to withdrawal from the association (union) apply to the liability of an excluded member of the association (union).
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The commentary was prepared within the framework of the scientific and practical research program of the Scientific Research Center of Private Law of the Kazakh State Law University.
Head of the working group on the preparation of the draft Civil Code of the Republic of Kazakhstan, Corresponding Member of the Academy of Sciences of the Republic of Kazakhstan, Professor Suleimenov M.K.
Deputy head Professor Basin Yu.G.
