Belarus - Raiffeisen Bank International AG
Belarus - Raiffeisen Bank International AG Belarus - Raiffeisen Bank International AG
8 Forming a company The forms of business organization provided for by the Belarusian civil code are partnerships (general partnerships, limited partnerships), joint stock companies (closed joint stock companies [ZAOs] and open joint stock companies [OAOs]), limited liability companies [OOOs] and additional liability companies (ODOs [where the members’ liability is increased to several times their required capital contributions]), state-owned enterprises and manufacturing cooperatives. In practice, nearly all Belarusian companies are joint stock companies. Foreign companies mainly opt for limited liability companies [OOOs] and, to a smaller extent, closed joint stock companies [ZAOs] as the form of business organization. The advantage of having one’s own Belarusian company rather than a representative office is that such a company can carry on business in its own name as a separate legal entity, for instance operating officially vis-à-vis the customs authorities as an importer into Belarus. The disadvantage is that it is captured fully by the Belarusian tax system. This taxable status naturally causes additional expenditure on bookkeeping and accounting, preparing tax returns and adhering to a variety of Belarusian legislative provisions. The framework underlying company law consists of the civil code and the law on joint stock companies, limited liability companies and additional liability companies (No. 2020 of 9 December 1992). Belarusian company law is generally similar to Austria’s. However, there are differences, for instance when it comes to company bodies and boards, and minimum capital requirements are much lower in Belarus. For example, the minimum capital requirement for a Belarusian limited liability company is currently €800, and 50 per cent of the share capital must be paid up prior to registration. Since 1 January 2005, machinery and plant provided as contributions in kind have no longer been exempted from Belarusian import charges (import duty, import VAT). A new amendment to the law on joint stock companies that contains several changes entered into forced on 10 July 2006. It regulates different ways of holding shareholders’ meetings. A shareholders’ meeting now has a quorum if ‘over 50 per cent’ of the voting power is present or represented (previously ‘not less than 50 per cent’), and the preparation and conduct of shareholders’ meetings are now described in detail. The registration of companies in Belarus is regulated by Presidential Decree No. 1 of 16 January 2009. This presidential decree entered into force on 1 February 2009. It has made the registration process much easier in that the so-called ‘declarative principle’ of business registration now applies. This means that, in contrast to the previous system (when the ‘approval principle’ applied), a company being newly formed can register within a few days. In other words, it can get itself registered in the single state register of legal entities and individual entrepreneurs and without prior state approval. Now, the authority merely carries out a formal examination of the registration to ensure that all the necessary documents have been provided.
Forming a limited liability company in Belarus involves the following steps: 1. registration in the single state register of legal entities and individual entrepreneurs at the registered address of the company being formed and payment of the registration fee within five days; In line with the changes made in 2006, the registering authority registers the company with the tax authority to obtain a tax reference number and registers it with the social insurance office, issues a manager certificate, registers it with the Belarusian Republican Unitary Insurance Company Belgosstrakh, registers it with the statistical office and registers its company stamp with the ministry of the interior. 2. if necessary, obtaining approval from the antimonopoly authority (see the chapter on cartel and competition law); 3. if necessary, registration with the securities committee; 4. the mandatory opening of a BYR bank account and optional opening of a US$ or € bank account to deposit the share capital of the company being formed. Since January 2008, it has been necessary to provide the following documents to form a limited liability company: – the application in the required form (Annex I of the Resolution of the Ministry of Justice No. 90 of 27 December 2007); – the formation documents of the company being formed (two copies of the memorandum and articles of association and the syndicate agreement if a joint venture is being formed) both in hard copy and as a PC file; – documents confirming that the share capital has been raised (proof that cash contributions have been paid, expert valuations of contributions in kind); – formation documents and proof that any foreign company is registered (or copy of the passport of a foreign citizen acting as founder, with translation); – stamp designs in duplicate; – proof that the registration fee has been paid (5 ‘basic values’, approx. € 55); – and, if the registration is taking place in the course of a reorganization (merger, acquisition, conversion), handover documents and transitional balance sheets. All Austrian documents must be authenticated with an apostille and submitted with a Russian or Belarusian translation. Further registration requirements apply when forming a joint stock company (including registering the shares with the securities committee) and additional documents must be submitted. It should be pointed out that registering and liquidating companies involves going through time-consuming and strenuous official channels. Because of the approval principle that applies to company registrations, officials often demand large numbers of documents to protect themselves against making the 9
- Page 1 and 2: Financial Market Report Belarus In
- Page 3 and 4: The Belarusian Financial Market Imp
- Page 5 and 6: The continuation of expansive polic
- Page 7: The general view is that representa
- Page 11 and 12: 3. Taxation and Legislation VAT The
- Page 13 and 14: Profit tax in a number of areas of
- Page 15 and 16: Special tax regimes Unified tax on
- Page 17 and 18: 4. Privatization Roughly 75 per cen
- Page 19 and 20: The arbitration clause of the Inter
- Page 21 and 22: Who can apply? All natural persons
- Page 23 and 24: 7. Risk Mitigation and Finance Guar
- Page 25 and 26: Investment of €100 Austrian Compa
- Page 27 and 28: 8. Payment and Account Services at
- Page 29 and 30: 9.3. Clearing Mechanisms Settlement
- Page 31 and 32: 10. Your International Business Spe
- Page 33 and 34: Notes 33
- Page 35 and 36: Notes 35
8<br />
Forming a company<br />
The forms of business organization provided for by the <strong>Belarus</strong>ian civil code are partnerships (general partnerships,<br />
limited partnerships), joint stock companies (closed joint stock companies [ZAOs] and open joint<br />
stock companies [OAOs]), limited liability companies [OOOs] and additional liability companies (ODOs<br />
[where the members’ liability is increased to several times their required capital contributions]), state-owned<br />
enterprises and manufacturing cooperatives. In practice, nearly all <strong>Belarus</strong>ian companies are joint stock<br />
companies. Foreign companies mainly opt for limited liability companies [OOOs] and, to a smaller extent,<br />
closed joint stock companies [ZAOs] as the form of business organization.<br />
The advantage of having one’s own <strong>Belarus</strong>ian company rather than a representative office is that such a<br />
company can carry on business in its own name as a separate legal entity, for instance operating officially<br />
vis-à-vis the customs authorities as an importer into <strong>Belarus</strong>. The disadvantage is that it is captured fully<br />
by the <strong>Belarus</strong>ian tax system. This taxable status naturally causes additional expenditure on bookkeeping<br />
and accounting, preparing tax returns and adhering to a variety of <strong>Belarus</strong>ian legislative provisions.<br />
The framework underlying company law consists of the civil code and the law on joint stock companies,<br />
limited liability companies and additional liability companies (No. 2020 of 9 December 1992). <strong>Belarus</strong>ian<br />
company law is generally similar to Austria’s. However, there are differences, for instance when it comes to<br />
company bodies and boards, and minimum capital requirements are much lower in <strong>Belarus</strong>. For example,<br />
the minimum capital requirement for a <strong>Belarus</strong>ian limited liability company is currently €800, and 50 per<br />
cent of the share capital must be paid up prior to registration. Since 1 January 2005, machinery and plant<br />
provided as contributions in kind have no longer been exempted from <strong>Belarus</strong>ian import charges (import<br />
duty, import VAT).<br />
A new amendment to the law on joint stock companies that contains several changes entered into forced<br />
on 10 July 2006. It regulates different ways of holding shareholders’ meetings. A shareholders’ meeting<br />
now has a quorum if ‘over 50 per cent’ of the voting power is present or represented (previously ‘not less<br />
than 50 per cent’), and the preparation and conduct of shareholders’ meetings are now described in detail.<br />
The registration of companies in <strong>Belarus</strong> is regulated by Presidential Decree No. 1 of 16 January 2009. This<br />
presidential decree entered into force on 1 February 2009. It has made the registration process much easier<br />
in that the so-called ‘declarative principle’ of business registration now applies. This means that, in contrast<br />
to the previous system (when the ‘approval principle’ applied), a company being newly formed can<br />
register within a few days. In other words, it can get itself registered in the single state register of legal entities<br />
and individual entrepreneurs and without prior state approval.<br />
Now, the authority merely carries out a formal examination of the registration to ensure that all the necessary<br />
documents have been provided.
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