The 2022 year in Belarus was rich in legislative changes for business, impact to which was largely given by the current situation in the region and the economy conditions.
The Art Legal team highlighted the key changes that have taken place in the legislation for business in Belarus in 2022, as well as the changes that business is waiting for in 2023.
1. NEW CONSUMER PRICE REGULATION
A t the top of our list is adoption in October 2022 of a new consumer price regulation that affected the vast majority of trade entities – producers, sellers and importers of consumer goods, for which maximum markups are set (importers, wholesalers and retailers).
Resolution No. 713 “On the Price Regulation System” obliged manufacturers to coordinate, as part of the administrative procedure, the setting of selling prices for new goods and increasing selling prices, and a new principle was established for importers to determine the maximum allowances for goods.
More details also on our website.
In development of the Resolution, a set of instructions and explanations was adopted which can be found at the link.
2. STABILIZATION AND COUNTER-SANCTION MEASURES
Based on the Edict of March 14, 2022 No. 93 “On additional measures to ensure the stable functioning of the economy”, as well as some other acts, starting from March 2022, a set of measures was adopted to maintain the stable development of the economy of Belarus, including:
– corporate restrictions for residents from “unfriendly countries” on the alienation of shares / shares from certain Belarusian companies, withdrawal from the membership, as well as a ban on reorganization (list of persons subject to restrictions: https://pravo.by/document/?guid=12551&p0=C22200436&p1=1&p5=0);
– granted the right to the Ministry of Finance, agent banks and other legal entities to fulfill obligations under external government loans, government securities placed on foreign financial markets, in Belarusian rubles;
– approved the list of foreign states committing unfriendly actions against Belarusian legal entities and (or) individuals;
– suspending of execution of enforcement documents issued in favor of residents of “unfriendly countries”;
– the right of Belarusian business entities to accept foreign cash from foreign counterparties under export agreements from June 10, 2022 to December 31, 2023.
3. NEW TAX DUTY FOR ADVERTISERS
From May 1, 2022, Edict No. 131 of March 31, 2022 “On the Development of Mass Media” introduced a tax duty for advertisers: 10% – when placing outdoor advertising and advertising on transport and 20% of the cost of advertising distribution services – in other cases. Payers of the fee are legal entities and individual entrepreneurs of the Republic of Belarus that are advertisers. Placement of advertisements of foreign advertisers is carried out through Belarusian advertising agencies, which are also required to pay an advertising fee.
4. BAN ON LINKING LEASE FEE TO FOREIGN CURRENCY
From September 23, 2022 to January 1, 2024, the right to determine the cost of contractual lease fee in foreign currency has been suspended. More details also on our website.
5. LAW ON PAYMENT SYSTEMS AND PAYMENT SERVICES
At the end of August 2022, the Law of the Republic of Belarus dated April 19, 2022 No. 164-3 “On Payment Systems and Payment Services” came into force, which legalised new types of payment activities. So, the Law directly permits the activity of accepting payments in favor of third parties (acquiring payment transactions), which previously could be carried out mainly by banks and non-banking financial institutions. In development of the Law, a whole package of by-laws of the National Bank was adopted. More details also on our website.
6. CHANGES TO INVESTMENT LEGISLATION
On July 12, 2022, amendments to the Law of the Republic of Belarus “On Investments” came into force. The amendments provide for additional guarantees for the protection of investors’ rights when implementing an investment project under an investment agreement concluded with the Republic of Belarus: the investor is guaranteed the right to avoid adverse changes in tax legislation; full and timely compensation in case of nationalization or requisition; the term for presenting individual claims to the investor by state bodies is limited.
Also in 2022, a draft Law of the Republic of Belarus “On Facilitating and Stimulating the Implementation of Investment Projects in the Republic of Belarus” was developed and submitted for public discussion.
7. NOVATIONS IN REGULATION OF CRYPTOCURRENCIES
Edict No. 48 of February 14, 2022 “On the Register of Virtual Wallet Addresses (Identifiers) and Features of Cryptocurrency Turnover” created a register of virtual wallets used in illegal activities, which the Hi-Tech Park was instructed to maintain. Almost all law enforcement and controlling authorities have gained access to this register. In addition, with the entry into force of the Edict, the regulation of the use of cryptocurrency in the framework of criminal and enforcement proceedings (withdrawal, sale and return) is fixed.
8. NEW LAW ON LICENSING
On January 1, 2023, the Law of the Republic of Belarus dated October 14, 2022 No. 213-Z “On Licensing” comes into force. The law has updated the list of requirements for license applicants and licensees for certain types of activities (for example, medical, legal, educational, etc.), a transition has been made to the registry principle of confirming rights, and the need to obtain a license as a document has been excluded, the grounds for refusal have been specified in granting a license, issues of carrying out a licensed type of activity in the event of a reorganization of a legal entity, the procedure for changing a license. The implementation of the Law entails the adjustment of a significant number of by-laws of ministries and departments.
9. CHANGES TO THE LAW ON THE SECURITIES MARKET
On July 23, 2023, the amendments adopted on the basis of the Law of the Republic of Belarus dated July 18, 2022 No. 197-Z “On amendments to laws on securities market issues”, which provides for the adjustment of the Law of the Republic of Belarus dated January 5, 2015 No. 231-Z “On the Securities Market”, which introduces the institutions of a qualified investor in the securities market, a foreign nominal holder, a representative of bond holders. Besides banks, professional participants in the securities market and insurance companies, qualified investors can also become individuals having necessary qualifications. The law introduces new types of bonded instruments – depositary and structured bonds.
10. CHANGES TO THE TAX CODE
From January 1, 2023, the amendments to the Tax Code adopted at the end of 2021 come into force. One of the key changes is the exclusion of the possibility of using the simplified tax system for individual entrepreneurs. Depending on the type of activity and other factors, an individual entrepreneur has the right to pay personal income tax or a single tax (according to the lists of types of activity). A new type of tax for individuals (self-employed) is also being introduced – a tax on professional income (handicraft activities, agro-ecotourism and other activities in accordance with the Decree of the Council of Ministers).
Among other changes on taxation issues in 2023, adopted on the basis of the Law of December 30, 2022 No. 230-З, is an increase in the general corporate profit tax rate for organizations to 20%; an increase in the tax rate on dividends for foreign organizations up to 15%; personal income tax increase for individual entrepreneurs up to 20%; limitation of 5 years of the audited period when conducting a desk audit of a business entity; other changes.
For a detailed analysis of tax novations in 2023, as well as other changes in legislation, stay tuned to our website or our social networks (Facebook, LinkedIn, Telegram).
OTHER CHANGES IN 2023
In 2022, other changes were also adopted, which will come into force in 2023: (i) the procedure for maintaining a book of comments and suggestions for business entities has been changed (now keeping a book is mandatory only for areas of activity defined by Resolution of the Council of Ministers dated 12/19/2022 No. 877); (ii) amendments to the Law of the Republic of Belarus No. 57-Z “On Accounting and Reporting” dated July 12, 2013; (iii) the size of the base unit since January 1 has been increased to 37 BYN; (iv) from July 1, 2023, a new wording of the Law “On External Labor Migration” comes into force; (v) as of October 1, 2023, a new law regulating the issues of economic insolvency and bankruptcy, Law No. 227-Z of December 13, 2022, “On the Settlement of Insolvency” comes into force.
