Belarus company registration

DOING BUSINESS IN BELARUS IN 2018

Since 2003, Healy Consultants Group PLC has been efficiently and effectively assisting our Clients with i) Belarus business registration ii) government license registration iii) business bank account opening iv) employee recruitment v) visa strategies and vi) office rental solutions.

Summary table of Belarus company registration

Summary	LLC	Free Zone company	Joint stock company	Representative office
Also known as	OOO	свободная зона	OAO	представительство
Best use of company?	All products and services	Manufacturing and export trading	To secure public funding	Marketing & research
How soon can you invoice Clients/sign sales contracts?	4 weeks	5 weeks	6 weeks	7 weeks
How soon can you hire staff?	4 weeks	5 weeks	6 weeks	7 weeks
How soon can you sign a lease agreement?	1 week	1 week	1 week	1 week
How long to supply corporate bank account numbers?	8 weeks	9 weeks	10 weeks	11 weeks
How long to supply company registration/tax numbers?	4 weeks	5 weeks	6 weeks	7 weeks
Corporate tax rate on annual net profits?	18%	0%	18%	None
Limited liability entity?	Yes	Yes	Yes	No
Government grants available?	Yes	Yes	Yes	No
Government approval required for foreign owners?	No	No	No	No
Resident director/partner/manager/legal representative required?	No	No	No	Yes
Minimum paid up share capital?	US$1	US$1	US$1,175	None
Can bid for Government contracts?	Yes	Yes	Yes	No
Corporate bank account location?	Belagroprombank	Belarusbank	Priorbank	Absolut Bank
Can secure trade finance?	Yes	Yes	Yes	No
VAT payable on sales to local customers?	20%	20%	20%	None
Average total business set up engagement costs?	US$7,940	US$10,790	US$7,940	US$11,090
Average total engagement period?	12 weeks	14 weeks	16 weeks	18 weeks

See full table

Accounting and tax considerations	LLC	Free Zone company	Joint stock company	Representative office
Statutory corporate tax payable?	18%	0%	18%	0%
Legally tax exempt if properly structured?	No	No	No	No
Group HQ tax incentives?	Yes	Yes	Yes	No
Must file an annual tax return?	Yes	Yes	Yes	Yes
Must file annual financial statements?	Yes	Yes	Yes	Yes
Must appoint an auditor?	No	No	Yes	No
Access to double taxation treaties?	Yes	Yes	Yes	No
Withholding tax on payments to foreign shareholders?	12%	12%	12%	None
Company Registration	LLC	Free Zone company	Joint stock company	Representative office
Resident director/partner/manager/legal representative required?	No	No	No	Yes
Minimum number of shareholders/partners?	1	1	2	Parent company
Maximum shareholding for foreigners?	100%	100%	100%	100%
Minimum statutory paid up share capital?	US$1	US$1	US$1,175	None
Security deposit to be kept with Government?	No	No	No	No
Shelf companies available?	Yes	Yes	Yes	No
Time to incorporate a new entity?	12 weeks	12 weeks	13 weeks	14 weeks
Can easily convert to a PLC?	Yes	Yes	Yes	No
Public register of shareholders and directors?	Yes	Yes	Yes	Yes
Can have preference shareholders?	Yes	Yes	Yes	No
Business Considerations	LLC	Free Zone company	Joint stock company	Representative office
Good entity for trademark registration?	Yes	Yes	Yes	Yes
Can secure an import and export license?	Yes	Yes	Yes	No

Sponsorship by a local citizen required?	No
Our Client needs to travel to Belarus for business set up?	No
Temporary physical office solutions available?	Yes
You need a local resident as bank signatory?	No
Can be wholly foreign owned?	Yes
The entity will likely be regulated by?	Trade Register
Minimum number of directors/managers?	1
Monthly VAT reporting to the Government?	Yes
Must sign an office lease agreement during incorporation?	No
Shareholders & directors documents to be attested/translated?	Yes
Each foreign director needs a personal income tax number?	No
Foreign director needs a residence visa?	No
Maximum number of staff allowed?	No maximum number for any entity
Expatriate to local staff ratio?	None
Can secure residence visa for business owner?	Yes
Other useful information
What will be included in my customer sales invoice?	Click link
This country has signed free trade agreements?	Yes
This country is a member of TRIPS?	No
This country is a member of the ICSID/WIPO?	Yes
Average custom duties suffered?	5.2%
Government foreign investment approval required?	No
Average monthly office rental? (US$ per sq m)	US$20
Minimum statutory monthly salary?	US$507
Average monthly US$ salary for local skilled employees?	3,591
US$ deposit interest rate? (1 year average)	1.95%
Overseas remittance currency controls?	Yes
Banking considerations
Multi-currency bank accounts available?	Yes
Corporate visa debit cards available?	Yes
Quality of e-banking platform?	Good
Crowd funding available in this country?	Yes

Belarus business setup summary

Press the link headings below to read detailed, relevant, up to date information.

Advantages and disadvantages
Advantages of Belarus company registration
1. Belarus has no restrictions on the residency or nationality for directors, founders or shareholders of a Belarus business entity. As opposed to other nations in the region, no additional permits are required for a non-resident director of a Belarus business setup. In addition, there is no minimum capital requirement for a limited liability company in Belarus;
2. The Belarus economy has been one of the most dynamic in Europe in recent years, with growth rates from 8 – 11% from 2004 – 2008. While the economy suffered during the global downturn in 2009, Belarus was one of the few countries to entirely avoid a recession and the economy has since recovered to post growth rates of 5 – 8% in the years following the recession. However, growth has not passed 2% since before 2012;
3. Compared to countries of the western world, Belarus is very cheap, including food, transport, utilities, rent, wages etc. Specifically, office rental tends to cost a fraction of what it does in most western cities, a beneficial condition for business;
4. The Belarusian government has taken steps in recent years to make foreign direct investment in Belarus a more attractive option, an advantage of operating a business in Belarus. In particular, the government abolished the golden share rule in Belarus, significantly limiting the ability of the government to interfere with the management of private enterprises;
5. Belarus is positively ranked as the 44^th easiest country to do business in, in a 2016 report published by the World Bank. Belarus’s high ranking is largely attributed to its simplified business registration process and the ease by which property can be registered in Belarus;
6. Under certain conditions, dividends earned from sources within Belarus by a foreign organization are liable for a corporate tax rate of 0%;
7. Belarus has 6 free economic zones which enjoy a range of customs and tax benefits, including i) exemption from VAT imposed by customs authorities on goods admitted for release into internal consumption, ii) exemption from corporate profit tax for first 10 years and iii) exemption from anti-dumping or countervailing duties pursuant to customs legislation.
Location
1. The country’s geographically strategic position is between Europe and Russia. Therefore, businesses can utilize the most cost effective mode of transportation and export to both massive markets;
2. Belarus’s relationship with Russia has gained it access to the Eurasian Economic Union, giving the country access to tariff-free trade with Russia, Kazakhstan, Armenia nad Kyrgyzstan.
Disadvantages of Belarus company registration
1. Belarus has a corporate tax rate of 18%, and capital gains are taxed at a rate of 9 – 18%. In addition, there is a withholding tax rate of 12% on dividends, 10% on interest, 12% on capital gains and 15% on other income;
2. The Belarusian economy suffered an internal economic crisis in 2011, largely due to a governmental attempt to raise average income in the country. Inflation reached upwards of 100% and the interest rates of several banks reached 120%. The Belarusian ruble has since recovered but is still reasonably unstable due to a lack of control methods;
3. Belarus is not a member of the EU or the WTO and heavy-handed government interference in trade markets makes trade a very difficult process for a private Belarus business setup;
4. Belarus suffers from high corruption, being negatively ranked as the 115^th least corrupt country in the world in the 2015 Corruption Perceptions Index by Transparency International;
5. Part of this is driven by the President, now in his fifth term in office. The President has broad legal powers and, until recently, was subject to sanctions from the EU for perceived human rights abuses;
6. Belarus lacks investment and financial freedom, being ranked 157^th in the 2016 Index of Economic Freedom by Heritage Foundation. The Belarusian government has little respect for property rights and government control is rigid in both the financial and investment markets;
7. Belarus has been poorly ranked as the 108^th freest economy (out of 180 economies) in the 2018 Index of Economic Freedom. This is largely due to its i) lack of freedom of the labour force, ii) poor fiscal conditions and iii) sluggish economic growth due to pervasive involvement and control of the government.
Language
1. The official languages in Belarus are Belarusian and Russian. The majority of Belarusians are not fluent in English. Consequently, language is a barrier when conducting business because all the communications must be translated into Belarusian or Russian.
Other
1. The Belarusian ruble (BR) is one of the most unstable currencies in the world. Thus, foreign investors can suffer large losses in foreign exchange when investing locally.
Best uses for a Belarus company
Industrial hub
Each region of Belarus has a free economic zone. By doing business in these zones, Clients enjoy a range of benefits including zero tax on exports for the first 5 years, priority at border crossings and full exemption from import duty on raw materials.