Starting a business in Belarus
With simplified registration procedures, it now takes just a day to establish a business in Belarus. When registration is based on documents from Poland, no additional legalisation is required.
In recent years, Belarus has become more attractive to foreign investment, thanks to creation of the Customs Union of Belarus, Kazakhstan and Russia, introduction of numerous tax incentives, simplified administrative procedures, and establishment of numerous special economic zones and technology parks. According to the World Bank report Doing Business 2013, Belarus is now 9th in the world in the speed of setting up a business (where, by comparison, Poland ranks 124th) and 58th in the overall ease of doing business (Poland ranks 55th).
Business may be conducted in Belarus in such legal forms as
- Registered partnership
- Limited partnership
- Limited-liability company
- Added-liability company
- Open joint-stock company
- Closed joint-stock company
- Production cooperative
- Uniform private enterprise
- Agricultural enterprise.
There are also separate subtypes—“joint venture” and “foreign” companies—but participation in a given company by a foreign entity does not necessarily mean that the company becomes a “joint venture” or “foreign” company.
A company is established through a resolution of the founders, recorded in a protocol.
Each entity operates under a name that includes one of the foregoing organisational designations. The company name must be approved by the local field office of the Ministry of Justice, but in practice approval is provided on the spot in just a few minutes, or in two business days if the application is submitted by post. If the company is founded by foreign entities, they must submit certified copies of the commercial register from their home jurisdiction and identity documents for the individuals representing the founders (with a Russian or Belarusian translation). Such documents generally also require legalisation, but this requirement is waived under the legal assistance treaty with Poland. Upon review of the documents, written approval of the company name is issued, valid for three months.
Before filing the registration documents, the statute of the company must be drawn up and the registered office selected. Under Belarusian law, the registered office of a company is the same as the location of its permanent executive body (the management board). The statute must contain the full and abbreviated name of the company, the address, the business purposes, and the structure of the management board. Additional information may also be required, depending on the legal form.
The amount of the company’s share capital may be freely set by the founders, with certain exceptions. For example, the minimum share capital for a closed joint-stock company is currently about EUR 900 and for an open joint-stock company about EUR 3,500, and “joint venture” and “foreign” companies require a minimum foreign investment of USD 20,000. The share capital stated in the statute must be paid within 12 months from registration of the company if not otherwise provided in the statute, but this period is longer in the case of “joint venture” and “foreign” companies.
After adopting the resolution on establishment of the company, obtaining approval for the company name and specifying the business location, the founders need to register the company. This is done on a “one-stop shop” basis at the local registry office for the registered address of the company. In practice, registration takes a couple of hours. The founders or proxies must appear in person to file the application for registration together with the statute (two copies and an electronic version). If the founders are foreign legal persons, they must present a legalised copy from the commercial register in their home jurisdiction or equivalent (in the case of Polish companies, the National Court Register transcript, which does not require legalisation), or if they are foreign individuals, a copy of their identity documents—in either case with a Russian or Belarusian translation. The filing fee is about EUR 30.
A stamp is placed on the company statute to confirm registration and the company is then entered in the commercial register (known as the Uniform State Register of Business Entities of Individuals and Legal Persons). Registration is effective upon placement of the stamp on the company statute.
Examples of major Polish investments in Belarus include Inco-Food, Idea Bank, construction materials company Tajfun, furniture manufacturer Black Red White, and food producer Mispol.
Polish investors take advantage of numerous Belarusian projects offering favourable investment conditions, particularly tax advantages, such as special economic zones, Hi-Tech Park Belarus, and the China-Belarus Industrial Park. An additional factor stimulating Polish investment in Belarus is the tax treaty between the two countries, enabling favourable tax treatment for implementing projects in Belarus, as we discuss in more detail in a separate article.
Alina Kalinowska of the Minsk Bar
Przemysław Szymczyk, Real Estate & Construction Practice, Wardyński & Partners