Summary
This article discusses significant legal developments in Eurasian Law from 2023.
Including a new law in Kazakhstan on digital assets and digital mining.
As well as Uzbekistan's new domestic violence law.
This article discusses significant legal developments in Eurasian Law from 2023.
Including a new law in Kazakhstan on digital assets and digital mining.
As well as Uzbekistan's new domestic violence law.
On April 1, 2023, a new law on digital assets (including cryptocurrencies, tokens, and other digital means of exchange) and digital mining (a.k.a. “crypto-mining”) came into effect in Kazakhstan, one of the world’s top hubs for crypto-mining. As shown herein, this law was just part of a continuing effort by the government to make Kazakhstan a global hub for digital mining and use of digital assets.
The advantages of digital currency utilizing blockchain technology include security of transactions, speed of transactions, and privacy from third party mediators. Digital assets are created by “mining,” which is the process used to generate new “coins” (cryptocurrency units) and verify new transactions. It depends on huge, decentralized networks of computers around the world that verify and secure “blockchains” (virtual ledgers that document cryptocurrency transactions). Computers used in mining activities are “paid” with new coins for the miners.
With its ample and cheap energy supply, a lax regulatory regime, and large empty spaces suitable for mining farms, Kazakhstan became a central digital mining location in 2017–2021. But the enormous and sudden growth of this activity put a heavy strain on the country’s antiquated power grid, leading to power shortages, blackouts, rising fuel costs, and increased political corruption, and pushing the country’s energy surplus into a deficit. Further, by utilizing loopholes to obtain government subsidies, many bitcoin operators drained money originally intended for other sectors of the economy.
As a result, Kazakhstan’s national utility was forced to buy electricity at inflated prices from Russia to help its population survive through the frigid winter of 2022–23. Because it was not possible then to convert bitcoin into Kazakh currency, the digital mining companies were not only taking a disproportionate share of the country’s power supply while transferring their profits outside the country, they often avoided taxes and usually employed few locals, thus providing no offsetting benefits for their communities.
To combat these pitfalls, taxes on digital mining in Kazakhstan were introduced on January 1, 2022 based on an entity’s electricity consumption, and mass protests in early 2022 led the Kazakh government to, in effect, cut off digital mining operations from the national grid, leading to large-scale closures of digital mining companies. In a subsequent effort to lure the digital mining industry back to Kazakhstan and boost the country’s finance and tech sectors, in September 2022, President Kassym-Jomart Tokayev promised “full legal recognition” of crypto assets, meaning that bitcoin and other cryptocurrencies would become convertible directly to Kazakh tenge (and vice versa) and eventually could be used to pay for goods and services in Kazakhstan. President Tokayev emphasized the importance of digital assets and his desire for Kazakhstan to be a leader in this field in Central Asia.
The Law on Digital Assets is the first of its kind in Kazakhstan and was intended to create a legal framework for digital mining, platforms for storage and exchange, and issuance and circulation of secured digital assets in the country. Prior to the passage of this new law, Kazakh regulation of digital assets was sparse and spread across several statutes, so a major goal of this legislation was to develop and systematize more complete regulation of digital assets and mining in the Republic of Kazakhstan. The Government also hoped the new framework would help develop the creation and circulation of digital assets in a way that will bring back foreign investors, attract new foreign investment, and increase state budget revenues.
Definitions
Article 1 of the Law on Digital Assets sets out a number of definitions, including the following:
Digital Mining License
Digital Mining Pools and Data Centers
Digital Assets Exchange
Limits on Electricity Usage
In November 2023, Kazakhstan officially introduced its central bank digital currency, the digital tenge. To demonstrate the country’s commitment to developing digital assets and finance, the chairman of the country’s National Payment Corporation (NPC) used a debit card to undertake the first transaction with digital tenge. Kazakh authorities collaborated with major global payment networks (such as Visa and Mastercard) and local banks to, among other things, integrate the digital tenge into plastic cards for global use, including Apple Pay. The Kazakh government plans to concentrate in 2024–25 on developing offline payment capabilities, reducing costs of transactions, enhancing security of transactions, and eventually, incorporating the digital tenge into international trade. This is part of a broader strategy to bring Kazakhstan’s financial system up to the standard of advanced western countries.
Violence against women has been a grave concern in Uzbekistan for decades. Legal protections for women and children abused at home were heavily undermined by traditional conservative Uzbekistani beliefs emphasizing the preservation of the family and prioritizing reconciliation and reunification of families rather than the protection of women. According to official statistics, in 2021, Uzbekistani law enforcement officials received over 72,000 complaints of harassment and violence against women and girls, of which eighty-five percent occurred within families.
Until very recently, domestic violence was not a criminal offense in Uzbekistan. It was addressed (if at all) under articles of the Criminal Code, such as those on bodily injury, slander, and insults as a form of psychological abuse. Uzbekistan’s first effort to specifically protect women from violence was the passage of a law in 2019 criminalizing physical, sexual, psychological and economic violence or harassment against women. The 2019 Protection Law enabled victims to apply to local police for a thirty-day protective order that could be extended once for an additional thirty days. Various councils and committees also were established to study domestic violence issues and support women, and governmental and civilian agencies were enlisted to help address the problem in specific ways. A January 2020 Cabinet resolution approved the procedure for issuing a protection order.
The protective order provision had immediate effect, with almost 15,000 protection orders issued in 2020, and 36,000 such orders being issued in 2021. But these numbers are believed to be much lower than the actual incidence of violence, as NGOs and women’s rights advocates have reported that many women remained reluctant to seek help from the police for fear of reprisals, social stigma, lack of knowledge about their rights, or fear of losing the economic and material support of their husbands.
Even after the 2019 Protection Law, perpetrators of domestic violence were rarely prosecuted. The Uzbekistani authorities “routinely fail[ed] to meet the standard of due diligence regarding the investigation and prosecution of crimes related to domestic violence.” It is estimated that only about seven percent of domestic abuse cases were heard by a court, and even when they did, perpetrators received light sentences or no punishment at all. Out of the tens of thousands of protection orders issued, less than one-fifth of the perpetrators had to go through correctional programs, and only 0.2 percent were prosecuted.
After many years of campaigning by Uzbekistani women’s rights activists and international human rights organizations, momentum for the criminalization of violence against women and children grew tremendously following a widely publicized case of child abuse in an Uzbekistani orphanage. In April 2023, Uzbekistan approved the Domestic Violence Law, comprising a set of amendments to the Uzbekistani Criminal and Administrative Codes, to criminalize domestic violence and sexual abuse of minors, to increase criminal and administrative penalties on perpetrators, and to provide women and children with greater protection from violence at home.
Definition of Domestic Violence
Before the Domestic Violence Law, “domestic violence” was not defined or punishable as a separate criminal offense in Uzbekistani law, but the new law explicitly criminalizes domestic violence as a separate criminal offense under the Criminal Code, defining “non-aggravated domestic violence” as:
Interference with the right to property, education, health care and/or work, deliberate damage to property and personal possessions, as well as disparagement of another person’s honor or dignity, intimidation, isolation from close relatives, committed against a spouse, former spouse, person living together on a common household basis or person with a common child, resulting in health impairment, committed after an administrative penalty for the same acts in the absence of signs of any other offense.
Under the new law, people found guilty of assaulting a current or former partner will face fines or prison time, and sexual offenders will not be eligible for early release. Further, the new law requires that those who commit sexual violence (against adults or minors) may not receive parole. Prior to the new law, they could be paroled after serving two-thirds of their sentences.
Stalking
The new law also introduced the concept of stalking (“преследование”) as “acts committed against the will of the victim, despite her two or more rejections or warnings, expressed by seeking out the victim, communicating with her verbally, through telecommunications networks, including the Internet, or by other means, visiting her place of work, study and/or residence, and causing the victim to fear for her safety.” A woman now may seek and obtain a protection order against stalking.
Sexual Harassment
The Domestic Violence Law defines “sexual harassment” as “the commission of a single rude or repeated acts of a sexual nature, undesirable to the target of such act(s) and humiliating to his/her honor and dignity, expressed in a description of his/her appearance or physique, through gesturing, touching, calling out, or having a sexual inclination.” The new law makes sexual harassment an administrative offense, the punishment for which is either a fine, compulsory community service or correctional work.
The Domestic Violence Law criminalized disclosing information about a person’s private life that damages her “honor and dignity” (e.g., online publication of private photos or “revenge porn”).
Extending Protective Orders
Before the Domestic Violence Law, if a woman was abused, she could be issued a protective order for a maximum of 60 days (thirty days plus a thirty-day extension). But only 0.2 percent of offenders against whom a protection order was issued were prosecuted. The new law lengthens the application of protective orders up to one year and simplifies the procedure of obtaining such orders.
Adding Aggravating Factors
Harsher penalties are imposed by the Domestic Violence Law for perpetrators of sexually violent crimes where (1) the offender has been convicted previously for coercion (Art. 121); (2) the crime involved sexual intercourse with, or indecent assault on, a person under the age of sixteen (Art. 128–129); (3) sexual violence was committed against a person known by the perpetrator to have a disability; or (4) sexual violence was committed against “a close relative, a former spouse, a person living together in a common household, or a person who has a child in common.” The penalty for rape was increased to 5–8 years, for rape with aggravating circumstances (e.g., if the victim is disabled) to 8–10 years, and for rape with severely aggravating circumstances, the maximum sentence is now 15 years. Rape of a child under 14 years of age now carries a 15–20 years prison sentence.
Sexual Violence Against a Minor
Prior to the passage of the Domestic Violence Law, persons committing a sexual offense against a minor could be held responsible if they knew that the victim was under 14, under 16, or under 18 years old (depending on the crime). This allowed law enforcement to decline to bring charges if the offender claimed not to know the age of the victim, or for the offender to use this defense at trial. Under the Domestic Violence Law, the perpetrator’s knowledge of the victim’s age is irrelevant in cases of rape, sexual assault, and sex with a person under the age of 16.
Before the new law, conviction for many sexually violent crimes against minors did not mandate prison sentences, and other types of punishment (e.g., weekend-only imprisonment or home detention) were available that were not considered adequate for the gravity of the crimes. The highest punishment for such crimes against minors was only two years of imprisonment. Now, imprisonment or other limits on freedom are mandated for such crimes, and if there are aggravating circumstances, imprisonment is required. Further, perpetrators of sexual violence against minors will be registered and prohibited from working with children.
Additional aggravating factors were added to sexually violent crimes against minors where the victim was a close relative of or living in the same household as the perpetrator, as well as when the perpetrator was responsible for the upbringing, education and/or care of the victim or was an employee of an educational, therapeutic or other institution charged by law with looking after the victim.
The Domestic Violence Law has been criticized in several respects by women’s advocates:
Nonetheless, the Domestic Violence Law is an important and helpful step toward decreasing rampant domestic violence against and harassment of women in Uzbekistan that can lead to further steps to protect women and children.
A constitutional referendum was held in Uzbekistan on April 30, 2023 regarding proposed constitutional amendments to, inter alia, extend presidential terms, make significant changes to the criminal code, and strengthen certain social guarantees for all citizens. The amendments changed approximately sixty-five percent of the Constitution, adding twenty-seven articles, increasing the number of norms (requirements) from 275 to 434, and increasing the number of provisions regarding human rights and freedoms by 350 percent, resulting in the publication of a new Constitution.
President Shavkat Mirziyoyev was re-elected in 2021 for a second term and, until the Referendum, was prohibited by the Constitution from running for a third five-year term in 2026. The Referendum increased the length of a presidential term to seven years (still limited to two terms), allowing President Mirziyoyev, pursuant to the Constitutional Court’s ruling prior to the Referendum, to seek a third (and presumably fourth) term of seven years each.
Prior to the Referendum, capital punishment had been prohibited by presidential decree. The Referendum ensured that the prohibition is enshrined in the Uzbekistani Constitution, consistent with the Constitution’s mandate that the “right to life is an inalienable right” of every person.
Another important addition is the constitutional “right to remain silent” during detention that is now part of Article 28 of the New Constitution. The police must inform a detainee of this right in a language he understands, along with the reasons for his detention. Article 27 now states that arrest, commitment and confinement may only occur pursuant to a court decision, and it decreases from 72 to 48 hours the time a person may be detained before a court makes a decision on whether to charge him. If he is not charged within 48 hours, he must be released.
In addition, the new amendments:
Pursuant to Article 31 of the New Constitution, a right to privacy is established, specifically, that “[e]veryone shall have the right to inviolability of private life, personal and family secrets, [and]protection of honor and dignity,” as well as the privacy of one’s correspondence, telephone conversations, electronic and other communications and protection of one’s personal data. The protection of personal data extends to give individuals the right to demand the correction of inaccurate data and the destruction of personal data collected illegally.