The Ministry of Industry and Infrastructure Development declared the claim illegal

No.6001-23-00-6ap/659 dated 08/15/2023

Plaintiff: NGO "Self–regulating organization of purchasers and processors of scrap of non-ferrous and ferrous metals of Kazakhstan" (hereinafter - the Association)

Respondent: State Institution "Ministry of Industry and Infrastructural Development of the Republic of Kazakhstan", State Institution "Committee for Industrial Development of the Ministry of Industry and Infrastructural Development of the Republic of Kazakhstan".

The subject of the dispute is to declare illegal the requirement to provide letters, tables and other data on the supply of scrap to the domestic market, as well as information on the volume of requested scrap exports, and to oblige to adopt a favorable administrative act that cancels any coordination of volumes of ferrous and non-ferrous scrap when it is exported outside the Republic of Kazakhstan and supplied to the domestic market

Review of the plaintiff's cassation appeal.

PLOT: On September 1, 2021, the Association sent a letter to the Ministry for No. 68, which contains a request to resolve the situation related to illegal requirements for obtaining permits for the export of scrap and approving plans for the supply of wagons, and to stop collecting tables and other data from companies involved in the collection, procurement and sale of scrap, as well as to cancel any agreements on the export of scrap outside the Republic of Kazakhstan and to lift any bans. On September 23, 2021, the Ministry provided a response to the above-mentioned appeal, from which it follows that in order to regulate the scrap market, the Ministry signed

An agreement on strategic cooperation between the Ministry, Associations and SRO of scrap-harvesting enterprises and metallurgical companies, providing for the conclusion of long-term contracts for the supply of scrap metal, the stability of their supplies in terms of quantity and quality, payment for the delivered volume of scrap, their conditions, technical requirements for scrap metal and other obligations.

Currently, the export of scrap is carried out on the basis of letters from the Association of Scrap Harvesting Enterprises and the enterprises themselves on the supply of scrap to the domestic market, as well as information on the volume of requested scrap exports. JSC NC KTZ coordinates transportation plans for ferrous and non-ferrous scrap based on technical capabilities.

According to article 9 of the CPC, everyone has the right to apply to the court for protection of violated or disputed rights, freedoms or legitimate interests.

The Association, exercising the right provided for by law, filed an administrative lawsuit with the court to declare illegal the requirement to provide letters, tables and other data on the supply of scrap to the domestic market, as well as information on the volume of requested scrap exports, and to oblige it to adopt a favorable administrative act that cancels any coordination of scrap volumes of ferrous and non-ferrous metals in its export outside the Republic of Kazakhstan and supply to the domestic market.

Motivating the demands by the fact that the Committee, through telephone messages to the associations, invites, among others, the plaintiff to participate in meetings of the Ministry.

Within the framework of these meetings, the Ministry requires the plaintiff, and then directly from the scrap purchasers themselves, to send monthly information on the shipment of scrap metals to the domestic market in the form of tables.

After fulfilling this obligation, the Ministry gives permission to companies to export scrap in the proportion set by it. This is an additional responsibility of entrepreneurs, which does not follow from the legislation.

Judicial acts:

1st instance: the claim was denied.

Appeal: the court's decision is upheld.

Cassation: judicial acts have been changed.

Regarding the refusal to satisfy the claim for declaring illegal the requirement to provide letters, tables and other data from Associations on the supply of scrap to the domestic market, as well as information on the volume of requested scrap exports, the claim was satisfied.

Conclusions: The courts, rejecting the claim, proceeded from the following: according to the Ministry's Order No. 161 dated March 30, 2020 "On determining the form of non-ferrous waste and the deadline for reporting on purchased and sold scrap and ferrous metals by legal entities engaged in the collection (procurement), storage, processing and sale of scrap and waste of non-ferrous and ferrous metals" (further – Order), Agreement on Strategic Cooperation dated June 15, 2020, minutes of the meeting on the regulation of waste collection of ferrous and non-ferrous metals in the Republic of Kazakhstan dated August 14, 2020, chaired by Deputy Prime Minister of the Republic of Kazakhstan R.V. Sklyar, minutes of the meeting on secondary metallurgy, chaired by Prime Minister of the Republic of Kazakhstan A. Mamin.U. On October 15, 2021, he concluded that the actions taken by the Committee to request information on the supply of scrap to the domestic market, as well as information on the volume of requested scrap exports, were carried out within the competence, in accordance with the instructions of the Ministry and in accordance with the terms of the Strategic Cooperation Agreement for Monitoring and Analyzing the Situation on the domestic Market.

Such conclusions of the courts are erroneous. The order provides for the obligation of scrap collectors to provide information about the scrap shipped in the reporting quarter once a quarter.

According to the Order, the defendants imposed an obligation on scrap collectors to coordinate the volume of exported scrap, despite the fact that there are no legislative prohibitions on the export of scrap by rail.

Also, at the time of consideration of the case in the court of first instance and the court of appeal, the Order became invalid as amended on April 29, 2021. These circumstances indicate that the defendant committed procedural violations, improper observance of the rights and legitimate interests of the plaintiff.

 

 

 

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