Media Overview

ince 1991 many fundamental changes have taken place in Kazakhstan. Due to the adoption and subsequent improvement of democratic legislative norms, an unprecedented growth in S the media, in terms of both quantity and quality, has taken place in Kazakhstan. In the first years of independence, after decades of exclusively state-owned media, hundreds of industry-oriented and private newspapers and journals appeared. In 1990, for instance, only 10 publications were distributed across the entire country, while each region could boast 1-2 local newspapers at best. By the end of 1991, 97 newspapers and journals were being published in the country, and as of the end of 1994 their number had increased to 313.

Currently, there are hundreds of mass media companies and agencies operating in Kazakhstan that voice views and interests of various community groups. The share of privately owned mass media has grown rapidly in the last five years and now totals around 70%. Non-Government Organizations (NGOs) currently own 116 different media companies.

As of July 1, 2001, there were 1,431 publications, electronic media and news agencies overall in Kazakhstan, including 950 newspapers and 342 journals plus 124 TV and radio stations, 76 of which use independent frequencies. Of 15 news agencies disseminating information on various topics, 13 are privately held. As to the degree of variety in these new media, in 1991 there were only two newspapers aimed at teenagers and four publications for children, while at present there are 20 newspapers and journals dedicated to young people and 31 publications devoted to children. The number of publications on religious and scientific subjects has substantially increased and now includes 29 newspapers and journals with religious orientation. The number of publications covering political issues has increased during the years of independence from 36 in 1991 to 256 in 2001. The principal regulatory body is the Ministry of Culture, Information and National Consent. It coordinates the media activities and is called to advocate the interests of the national mass media. It has the right to propose new legislation or amend existing laws regarding the media. It is also responsible for the registration of newly established media companies and annulment of the registration after infringements of the Law on the press.

State-owned media companies are financed out of the state budget. The subsidies are channeled through the Ministry of Culture, Information and National Consent and regional, city and district administrations. Both the official press and electronic media carry some advertising. Advertising, private announcements and classified ads constitute the main source of income for private TV, radio stations and newspapers. Democratization and Liberalization of the Mass Media

At the President’s initiative, a comprehensive program of democratization is being implemented involving a staged approach to liberalizing the relationship between the State and the media. Denationalization and privatization of the existing State-owned press and electronic media are important steps in this direction.

Thirteen newspapers and magazines, including Kazakhstanskaya Pravda, plus two state-owned television and radio companies have been denationalized. Open tenders were held to transfer state-owned newspapers published in Ukrainian, Korean and German to private management for the term of five years. Denationalization of regional State-owned publications is also underway throughout the Republic.

Replacing direct State financing of the print media in 1998 with a system of orders placed by governmental agencies was another important step toward further democratization of the relationship between the State and the media. Orders are awarded based on the results of specific tenders, irrespective of the participants’ form of ownership. This establishes equal conditions for obtaining financial support both for State-owned and private media outlets, thereby stimulating their business initiative. In 2001 a total of 24 publications 2 TV and radio companies won such orders; 18 of them are privately owned.

A number of practical measures have been adopted to protect the domestic media, including provisions exempting certain of them, both private and State-owned, from value-added tax. In particular, the amendment to the law on taxes and other mandatory payments to the budget signed by the

Doing Business in Kazakhstan - 1 - Mass Media President on May 3 exempts from VAT all print media, except those in which advertisements make up more than 2/3 of the publication. The exemption applies not only to production costs and sales revenue for domestically published newspapers and magazines, but also to advertising services as well.

In addition, sales and production costs related to domestically produced TV and radio programming and advertising services rendered by these companies likewise enjoy incentives in relation to VAT, but under a different mechanism. Their sales revenue and production and distribution costs, as well as the cost of advertising services are taxed at the so-called zero rate, meaning the budget will reimburse them 16% of their expenses for producing TV and radio programming. As a result, the more programming our domestic TV and radio companies produce, the more they receive from the budget.

These incentives are intended to provide real and meaningful support for developing the domestic information industry.

This approach also calls for liberalizing the procedure for obtaining frequencies and also reducing the cost for their usage, given the growth of the private sector of the media. A resolution of the government adopted in 1998 simplified and liberalized the conditions for holding tenders to acquire TV and radio frequency usage rights, including introduction of a system of open voting. A representative of Internews Network, a US-based organization, was made a member of the tender commission. In 1999 the government adopted a resolution that cut the rates for use of TV and radio frequencies by 3-5 times. Another resolution of the government, adopted in 2001, reduced these rates once again, in certain specific instances by as much as 24 times.

The introduction of more reasonable rates for use of radio and TV frequencies is a powerful incentive for the further development of the electronic media in Kazakhstan. The concrete measures on further democratization of the media and the right to easily obtain and distribute information are part of Kazakhstan’s open door policy. During the last few years the number of foreign mass media working in Kazakhstan has increased significantly, and now includes France Press, Reuters, Anatolia, Sinhua, RIA-Novosti, BBC and Radio Liberty, as well as numerous agencies representing CIS countries. As of July 1, 2001, the Ministry of Foreign Affairs has accredited 79 foreign journalists.

In addition, the main Russian TV channels broadcast in Kazakhstan, as well as CNN, BBC and Deutsche Wave.

Media freedom in Kazakhstan is promoted under the active support of the local civil society organizations. NGOs advocating freedom of speech by their activities and publications play a substantial role in protecting rights and interests of mass media. The Kazakhstan civil society has proven to be an important player in building open society through establishment of open objective and progressive journalism in everyday life of the country through monitoring violations of freedom of speech legal analysis of information received, which allows to follow tendencies of development of freedom of right and define activity plans on improving legislation, mass media’s relations with authorities. Among the most active, well-known and progressive civil society organizations promoting media rights in the country are:

· Association of Independent Electronic Mass Media of the Countries of Central Asia · Azia Dauysy (Free Tribune of Journalists) · Birlesu · Eurasia Foundation - Kazakhstan · International Journalism Center · Internews - Kazakhstan · Kazakhstan Press Club · National Press Club · Soros Foundation - Kazakhstan · Kazakhstan Broadcasting Association · International Foundation for protection of freedom of speech Adil Soz Media Companies

The leading TV and Radio company of Kazakhstan with a high rating of popularity (with an estimated audience of 64 million people) Khabar Agency broadcasts all over Kazakhstan and covers the neighboring regions of Russia, Central Asia and China.

Doing Business in Kazakhstan - 2 - Mass Media Among other professional and popular broadcasting channels are KTK, NTK, Channel 31, TRK Shakhar, TAN, Rakhat, Radio Europa-Plus Kazakhstan, Radio Hit, Radio NS, Radio City, etc. In addition to the broadcasters in Almaty, there are many regional, provincial and city TV channels controlled by local authorities as well as private companies.

The newspaper market in the country is divided between Russian and Kazakh language papers. It should, however, be noted that the Russian language papers by no means target only the ethnic Russians, are of general interest and read by various people in the country.

The main Russian language papers are Caravan (www.caravan.kz, www.hotline.kz ) (circulation 240,000), Caravan-Blitz (45,000), Argumenty i Fakty - Kazakhstan, the business-oriented newspapers Panorama (www.panorama.kz) (12,000) and Delovaya Nedelya (www.dn.kz) (8,000), and the semi-official presidential and governmental newspapers Kazakhstanskaya Pravda (www.kazpravda.kz) (55,000) and Novoye Pokolenie (7,000).

The main Kazakh language papers are the semi-official presidential and governmental newspaper Yeghemen Kazakhstan (62,000), the edition of the Republican Society for the Advancement of Kazakh Language Ana Tili (Mother Tongue, 42,000), the youth paper Zhas Alash (22,000) and the children paper Ulan (16,000).

The newspapers Yeghemen Kazakhstan, Kazakhstanskaya Pravda, Zhas Alash, Ana Tili, Argumenty i Fakty - Kazakhstan, Caravan and Caravan-Blitz are distributed to the regions.

Since Kazakhstan has a multinational society, the government supports a multilingual approach and a policy of social and cultural diversity in the media. Newspapers, journals and other publications in Kazakhstan are printed in Ukrainian, Korean, Uigur, Dungan, Turkish, German, English, Arabic and Polish, in addition to Kazakh and Russian languages. The government currently finances periodic publications in Ukrainian, Korean, Uigur and German.

Kazakhstan has national and local (provincial, city, and district) newspapers. On average, more than 20 newspapers are registered in each of the 19 regions, totaling to 408 provincial publications. The network of district publications survived: there is a bi-lingual newspaper in almost each district center. Legislation Related to Media

The first law on the press and other mass media, providing freedom of speech for citizens and fundamental rights for the media and journalists, was adopted in 1991. With this legislative act, the political censorship that existed during the Soviet regime was abolished. As a result, the country’s mass media began a period of rapid growth. Private publishing houses, television networks and radio stations began to appear for the first time. Around 500 media companies appeared in 1991-1995, printing and broadcasting in various languages and reflecting a variety of interests.

A new law on mass media was drafted in an attempt to reflect the needs of Kazakhstan’s new reality and was adopted on July 23, 1999. This law develops the democratic principles set forth in the previous law. It differs from that law by being more compact in size and better reflecting the country’s market economy reforms. The new law is better suited to strengthening freedom of speech and protecting the rights and liberties of the citizens of Kazakhstan.

The new Law gives a broader and better definition of the rights and obligations of journalists, including the right to visit government agencies, businesses and other organizations; to make recordings using audiovisual and photo equipment, except in instances where that is prohibited by law; to receive access to documents and materials, except for any fragments containing information which constitutes a State secret; and to maintain the confidentiality of sources of information, except in instances where their identity must be revealed by court order.

According to the new law, government agencies and other organizations, as well as officials guilty of concealing information or hindering a journalist in his or her professional activities can be held criminally liable.

A new provision has been introduced whereby the suspension or closing down of any publication of broadcast media is possible only by court order or at the sole discretion of the owner. In addition, the term for suspension of any media outlet by court order has been reduced from 6 to 3 months. Doing Business in Kazakhstan - 3 - Mass Media State registration of media outlets has been replaced by a substantially easier procedure. The number of documents that must be submitted for registration has been reduced and the grounds for denial have been minimized. Other requirements that could serve as an obstacle to the creation of new media have been eliminated.

According to the opinion of a number of international organizations, the Republic’s law on mass media adopted July 23, 1999 is democratic and liberal, but implementation of some of its provisions proved to be difficult. For this reason, a decision was made to make certain amendments to the law.

The amendments to the law on mass media by no means limit the rights of citizens to receive and disseminate information and do not affect the democratic essence of the legislative foundation for the development of the Republic’s mass media.

First, amendment was made to categorize Internet websites as mass media. There are approximately 80 Internet service providers in the country and more than 100,000 consumers use the net on a regular basis. According to current information, there are around 1,000 domestic websites, but the activity of these domestic sites has not been regulated by law. The result is that information posted on web sites in Kazakhstan is essentially outside the reach of legislation, which has resulted in violations of the rights and liberties of citizens. For this reason, websites in public telecommunication networks (the Internet, etc.) that represent a form of periodic or uninterrupted public dissemination of information have been categorized as mass media.

Second, in order to strengthen and develop Kazakhstan’s domestic information industry and given the need to increase the share of domestically produced programming, a provision has been adopted limiting the retransmission in Kazakhstan of foreign TV and radio programs. At the same time, the provision relates only to frequencies issued by the government, and is in no way related to informational isolationism or restricting the exchange of information with foreign countries. Thanks to cable television, Kazakhstan’s citizens may watch programming from all the major countries of the world.

Third, an amendment to the law was added on the liability of media owners and editors-in-chief for disseminating information in violation of the Constitution and other laws of the Republic, regardless of the source of the information. The need for this amendment was dictated by the fact that the deliberate reprinting of such illegal information by owners and editors-in-chief previously had no legal consequences.

Doing Business in Kazakhstan - 4 - Mass Media