Ministry of Artificial Intelligence and Digital Development of the Republic of Kazakhstan
Step-by-step instructions on legalization for further payment of taxes. The client is a legal entity, has the intention to purchase a mining farm. What actions should he start with?
Regarding the allocation of territory for mining activities, you need to contact the local akimat, and in order to obtain technical conditions for connection to the national electric grid, you need to send a request to KEGOC JSC or contact the authorized body in the field of energy supply of the Ministry of Energy of the Republic of Kazakhstan.
Regarding the legalization of mining activities, we inform the following: legal entities engaged in digital mining activities, on the basis of the Order of the Minister of Digital Development, Innovation and Aerospace Industry "On approval of the Rules for Informing about digital Mining Activities" dated April 29, 2022 No. 146/NK, inform within 30 calendar days about the planned activities for the construction of centers processing of data in the form of a paper appeal or in the form of an electronic document to the authorized body.
Do I need another registration and/or notifications, is there a certain regulation regarding the start of maintenance and repair of mining equipment?
Companies that carry out activities for the maintenance and repair of mining equipment are not persons engaged in digital mining. In this regard, there is no need for registration and/or notification to the authorized body.
By what parameters is illegality determined, or why are «Gray» mining companies called?
Companies engaged in digital mining activities in violation of the requirements of legislation in the field of electric power industry are conventionally called «gray mining companies».
Are there any restrictions on the power consumption of electricity? Should I get technical specifications specifically for the data center in the room that they plan to rent?
Questions regarding restrictions on the power consumption of electricity and obtaining technical specifications are regulated by the requirements of regulatory legal acts in the field of electric power industry. In this regard, in order to receive an exhaustive answer, it is necessary to contact the authorized body responsible for the management of the electric power industry of the Republic of Kazakhstan (the Ministry of Energy of the Republic of Kazakhstan) .
Is there a difference between a «data center» and a mining farm?
The functional purpose of a traditional data center is to process and store data. The activity of mining farms is aimed at the extraction of unsecured digital assets (cryptocurrencies). The consolidation of the concepts of data center and mining farms is not currently reflected in the current legislation. Within the framework of the draft law «On digital assets in the Republic of Kazakhstan», it is planned to adopt the concept of mining farm.
What tax payments are levied on this activity?
Since January 1, 2022, a fee for the amount of electric energy consumed during digital mining (1 tenge per 1 kW/hour) has been put into effect.
So far, if an individual has not submitted a notification to inform about digital mining activities, then this is not a violation?
Since January 1, 2022, a fee has been put into effect for the amount of electric energy consumed during digital mining (1 tenge per 1 kW/hour) and activities in the field of digital mining are entrepreneurial activities. In this regard, for the purpose of legal functioning of the mining farm and timely payment of tax obligations, we recommend individuals to carry out mining activities as an individual entrepreneur. Legal entities engaged in digital mining activities inform the authorized body within 30 calendar days about the planned measures for the construction of data processing centers in the form of a paper appeal or in the form of an electronic document.
Should I submit two reports on my activities to the authorized body if at the same time, in addition to digital mining, the company provides services to provide infrastructure for digital mining to third-party tenants? Is it required to inform the authorized body about the activities of digital mining as a data center according to the rules for informing about digital mining activities?
Practice shows that there are companies that provide services to provide infrastructure for digital mining. In this regard, the Ministry initiated changes to the Order regarding the delineation into categories for current activities, planned activities and the provision of services for the provision of infrastructure for digital mining. To date, a register with delimited categories for current activities, planned activities and the provision of infrastructure services for digital mining is published on the official Internet resource of the Ministry on a weekly basis. In this regard, the Ministry recommends officially informing companies that provide services for the provision of infrastructure for digital mining. You need to send two notifications to the authorized body on digital mining activities in accordance with the Order of the Minister of Digital Development, Innovation and Aerospace Industry «On approval of the Rules for Informing about Digital Mining Activities» dated April 29, 2022 (Registered with the Ministry of Justice of the Republic of Kazakhstan on April 29, 2022 No. 27840).
Do individuals have the right without registering an individual entrepreneur, on their land plot, which belongs to them by right of private ownership, or on a land plot to register a mining form for themselves as an individual, and what is necessary?
In order to ensure the legal functioning of the mining farm and timely payment of tax obligations, we recommend individuals to carry out mining activities as an individual entrepreneur.
