Kazakhstan's common law financial hub opens new pathway for HK listings

Although Kazakhstan operates under a civil law system, it established a common law-based financial zone eight years ago to attract international investment and help raise funds.

With that, a major Kazakh company completed a dual listing in both Kazakhstan and Hong Kong last year.

Last year, Jiaxin International Resources, the world's fourth-largest tungsten mining company, became the first Kazakh company to complete a dual listing in Kazakhstan and Hong Kong. But bringing the company to the Hong Kong market was far from straightforward.

Kazakhstan follows a civil law system, while Hong Kong operates under common law, meaning legal and regulatory differences needed to be bridged.

To better connect with international investors, Kazakhstan established the Astana International Financial Centre in 2018. Located in the country's capital, the centre functions as an independent jurisdiction with its legal regime based on the common law system.

A lawyer involved in Jiaxin's listing said even when legal frameworks share similarities, their Central Asian clients need time to navigate the system and legal documents.

He said differences in legal and compliance requirements meant more efforts were needed for communication and preparation. They include drafting contracts and corporate articles.

Interest in Hong Kong's capital market appears to be growing across the region. Reports have suggested that entities including Kazakhstan Temir Zholy and Kazakhstan's sovereign wealth fund are considering listings in Hong Kong.

Chief Executive John Lee is leading a delegation to Central Asia Sunday.

Hong Kong Exchanges and Clearing's Chief Executive Bonnie Chan will take part in the trip. She says Hong Kong is well-positioned to attract more companies from the region. This as companies often require repeated access to capital markets as they expand, whether through secondary share offerings or bond issuances.

As Hong Kong has long provided professional and financial services to businesses from ASEAN and the Middle East, the legal sector believes the same advantage can be leveraged for Central Asia.

Law Society of Hong Kong President Roden Tong says many Central Asian companies may be unfamiliar with Hong Kong's legal system and investor protections.

He believes greater engagement and legal outreach could help boost confidence among Central Asian companies considering Hong Kong as a fundraising destination.