Legislative Maintenance of the Investment Policy of the Republic of Belarus
The investment process is one of the major factors defining social and economic development of Belarus, its technological progress and efficiency of goods production.
It causes heightened interest in the state means of activization of the investment process within the economic influence on internal and external investments.
The favorable legal conditions for investors’ activity are generated now in Belarus.
The investment activity in the Republic can be carried out in the following forms:
- Creations of the legal entity;
- Acquisition of the property or the property rights, namely: shares in the statutory fund of the legal entity, the real estate (including constructions); stocks; the rights on the objects of intellectual property; concessions; the equipment and other capital goods.
The basic document defining the general conditions of the investment activity in Belarus is the Investment Code. It directs the stimulation of the investment activity and protection of the investors’ rights on the territory of the Republic.
In the process of the investment activity including the realization of the investment projects the investors have the right to the state support in a form of the centralized investment resources or granting guarantees of the Government of the Republic of Belarus. All the foreign investors are guaranteed the property rights, the property rights got in the lawful way and other real rights.
And the main thing that is guaranteed to the investors is equal protection of the rights and legitimate interests, irrespective of a pattern of ownership, without any discrimination.
Investors can independently carry out any kinds of activity if they are not forbidden by the legislation of Belarus and correspond to the purposes stipulated in the charter of this organization, to carry out all the actions resulting from the possession and use the objects and the results of the investment activity. In particular, to dispose the profit received from investments, to reinvest it on the territory of Belarus or transfer it abroad after the payment of the taxes and other obligatory payments.
Investments cannot be gratuitously nationalized or requisitioned. Such processes are possible only with timely and full indemnification not only the costs of the investment property, but also other losses caused by them. The Investment Code also fixes the right of the investor to appeal against the actions (inactivity) of the state bodies or their officials and their certificates breaking the rights of the investor and (or) causing losses to the investor in a judicial mode.
The state decisions promote improvement of the investment climate and rational distribution of the invested means in structure and on territories according to the state priorities:
- The Decree of the President of the Republic of Belarus on August 6, 2009 No. 10 “About creation of additional conditions for investment activity in the Republic of Belarus” statutory the rules, which facilitate the beginning of investment project realization and for Belarusian and for foreign investors.
The Decree has three-level system conclusion of contract be investors with the Republic of Belarus.
The investment contract is concluded on the basis of decision of:
- The Council of Ministers in concordance with the President of the Republic of Belarus, when by the contract the investor has preferences, which are not agreed with legislative act or other decisions by Head of country;
- The Council of Ministers, when by the contract the investor has preferences, which are agreed with legislative acts or other decisions by Head of country; -Republican authority of State administration, other state organization in witness of Government; the decisions of regional executive committee in falls, when the project realization doesn’t need preferences.
In concluded become clear object, volume and time of investments, liability of investor for commitment. General preferences for investors with investment contracts:
- Ground area under lease without public sale; - Phased preparation for allotment of ground area simultaneously with construction on the de facto used areas and construction with projecting of next phases of construction;
- Import of technical equipment and spare parts is without custom duty, VAT and other. The investment contract scheme with the Republic of Belarus is simplified in the Decision of the Council of Ministers No. 1449 of November 06, 2009 “About measure in the realization of Decree of President of the Republic of Belarus August 06, 2009, No. 10”.
For development of regions and trades of Belarus, realization and investment projects, including the creation and development of organizations with participation of strategic important investor, Order of President of the Republic of Belarus of the August 06, 2009 No. 413 physical and juridical persons has right to represent the interests of the Republic of Belarus (further – investment agents) in questions:
effort to attract the investors for realization of investment projects in behalf of the Republic of Belarus;
support of investment projects (by preparing and realization), including consulting, juridical and marketing services.
The status scheme of investment agent is fixed in the Decision of the Council of Ministers No. 1448 of the November 06, 2009.
- The order of the state registration and liquidation of legal entities is simplified (the Decree of the President of the Republic No. 1 from January 16, 2009). Follow the date of the February 01, 2009 it is taken the declaring principle of the state registration of the entities, except banks and non – bank credit financial organizations. The registration is made on the very date of presenting the documents. The Decree simplifies the requirements towards entities constitutive documents, excludes the requirements towards the minimum statutory fund of commercial organizations (except joint-stock companies, banks and insurance organizations). The statutory fund is determined by juridical persons themselves. The principle “one window” is fixed in mutual actions of state bodies at liquidation of legal entities and the termination of activity of individual businessmen.
– There are economic stimulations of enterprise activity on the territory of rural settlements (the Decree of the President of the Republic of Belarus No. 9 on December 20, 2007). The special order of the taxation is applied to the organizations and the individual businessmen working in the countryside since January 1, 2008. Within 2008-2012 they are released from the payment of the profit tax and the tax to the real estate. The payment for licenses reception is decreased. For the purpose of decreasing of the expenses for building for the period till 2011 a number of tax privileges are introduced. The organizations working in the countryside are released from the customs payments and the VAT for import of the technological equipment as the contribution into the statutory fund. It will allow to release the investments necessary for modernization of operating and new manufactures from the taxation. The legal entities realizing investment projects in rural settlements can receive inexpensive credits up to ? 20 000 with the minimum formalities.
- There are privileges and special working conditions for the enterprises created in small (up to 50 thousand inhabitants) cities. Privileges and special conditions extend on all investments, including foreign (the Decree No. 1 on January 28, 2008). The legal entities created in small cities after April 01, 2008, are released from the payment of the profit tax and obligatory currency sale for 5 years, are completely free in pricing the goods. They can define independently the level of employees’ payment. They are also released from gathering the payment in a support fund of agricultural manufacturers. The imported equipment, as the contribution into the statutory fund, is released from the customs payments and payment of the VAT. Such enterprises can insure the property interests at foreign insurers.
- Conditions on involving in economic circulation of not used state property located on the territory of rural settlements are defined by auction with an establishment of the initial price of sale to equal one base size. There is a possibility of transferring such property to gratuitous using (the Decree of the President of Belarus No. 108 on February 27, 2007).
- The procedure of withdrawal and granting the land sites is simplified (the Decree No. 667 on December 27, 2007.). The acceptance of the document considerably reduces the investment risks in preparations of the expensive building documentation connected with possible refusal in granting the land sites.
- There is a possibility for the entities, which received the status of «the diligent participant of foreign trade activities» to import the goods for the industrial needs in the simplified order and to use them at once in the manufacture without customs clearing. In this case corresponding customs procedures will be carried out on application principle without goods presentation in customs (the Decree No. 40 on 28.01.2008)
-The list of privileges to residents of free economic zones is expanded and it guarantees the invariance of a special legal regime of the taxation given to them. Such guarantees will operate till March 31, 2015 for already registered in FEZ residents, for new ones - within seven years follow the date of their registration in FEZ (the Decree No. 42 on 28.01.2008.). The administration power of FEZ is expanded in taking the decisions about the registration of legal entities and individual businessmen as residents of FEZ at realization by them the projects with the declared sum of investments over 1 million Euro.
- Conditions for the reduction of objects building terms and the development of material base are created, procedures in construction branch are simplified, the right to construct the premises for the citizens with the state support is given that will allow to increase housing construction volumes (the Decree No. 277 on 15.05.2008) etc.