Business entities in Belarus
With a pro-business climate and rapidly-developing industrial production, Belarus offers great opportunities for investors. There are several corporate vehicles used to do business in Belarus. The most common are the limited liability company and representative office.
The Belarus limited liability company (Общество с ограниченной ответственностью)
- A Belarus limited liability company (LLC) can be incorporated with only one director and one shareholder. While the shareholder can be any nationality, the director must be a Belarusian national or have a local work permit;
- The minimum statutory share capital of €50 (100 BYN) must be paid up within 12 months of company registration;
- A foreign shareholder with a local work permit can register a single shareholder LLC, also known as a private unitary enterprise. An LLC with more than one owner is known as an OOO;
- Incorporation is straightforward and requires minimal documentation from our Client. With a power of attorney (PoA) legalised by a Belarussian embassy, and our Client’s passport copy, Healy Consultants Group will assist our Client form a simple LLC within two weeks, without our Client needing to travel to Belarus;
- All directors of the company must be citizens of either Belarus, Russia, Kazakhstan or Armenia, or must be allowed to work in Belarus. Therefore, once the company is fully registered, foreigners must obtain a work permit before our Firm can appoint them. If necessary, Healy Consultants Group can provide our Clients with a temporary, passive nominee resident director until they can obtain a work permit or hire a local to assume such a role;
- All LLCs must submit annual financial statements to the government.
An LLC is the most flexible company structure and is recommended for almost all business activities.
Belarus joint stock company (Акционерное общество)
- The Belarus joint stock company (JSC) can be incorporated by two shareholders, who can be any nationality and place of residence and one director, who must be a Belarusian national or have a local work permit. Each shareholder is required to contribute at least €1,125 (2,550 BYN) to the JSC’s share capital for a closed joint stock company (ZAO), or €4,500 (10,500 BYN) for an open joint stock company (OAO)
- A minimum of one auditor must be appointed after the company is fully registered;
- A joint stock company is considered closed if i) the distribution of shares requires the consent of other shareholders, and/or ii) shares are distributed only to certain categories of people. Closed joint stock companies may have a maximum of 50 shareholders.
The registration process of a JSC is more complex and time consuming than an LLC. We recommend this entity only for a large company.
The Belarus representative office (Представительство)
- While Belarusian legislation does not allow foreign business entities to establish branches, foreign organisations have the right to establish detached divisions in the form of representative offices;
- The main functions of a representative office of a commercial foreign company in Belarus include i) investigating opportunities for investment ii) marketing the parent company and iii) conducting market studies iv) selling tickets and booking seats for aviation, rail, road and sea transport companies;
- A representative office of a non-profit foreign company may be opened only for the purpose of i) social support and protection of citizens ii) environmental protection and animal welfare iii) protection and proper maintenance of buildings, structures, other objects and historical, cultural and religious territories iv) activities in the field of education, science, culture, art, spiritual development of personality v) activities in the field of physical education and mass sports and vi) other socially useful activities;
- Representative offices are not regarded as legal entities and may not carry out income-earning business activities in Belarus;
- The number of foreign employees may not exceed five;
- To complete the engagement, all foreign language documents must be translated in Russian/Belarusian and apostilled or legalised by the nearest Belarus embassy.
Representative office registration is time consuming and is recommended only for Clients who want to study the local market.
Belarus Free Economic Zones (Свободные экономические зоны)There are six Free Economic Zones (FEZ) in Belarus: Minsk, Grodnoinvest, Brest, Vitebsk, Mogilev, Gomel-Raton:
- Our Clients may be registered as a resident of any FEZ if the amount of an investment project in the FEZ is at least €1 million (invested within two years), or €500,000 (invested within three years);
- An FEZ entity can be registered with i) only one shareholder ii) one director, who can be a foreigner and need not be resident in Belarus and iii) a lease agreement for office, warehousing or industrial space within the free zone;
- Healy Consultants Group will assist our Clients to identify the optimal Belarus free zone according to their business activity.
Businesses operating in FEZs enjoy a range of benefits
- Zero-rated tax on profit for five to 10 years. Thereafter tax is calculated at 50% of the rate;
- 50% discount on VAT for products included in the list of import-substitution goods and sold in Belarus;
- Well developed transport and logistics infrastructure (on the intersection of major European highways, an extensive network of roads and railways);
- Customs exemptions on raw materials and equipment imported from outside Belarus.
A Belarus FEZ company is an attractive vehicle to legally minimise international tax for large companies or conglomerates who plan to conduct large-scale production of goods focused on exports to Russia, the Baltic States, Scandinavia and Central Europe.
Table of comparison between Belarus entities
Compare different Belarussian entities LLC JSC Representative office Also known as OOO ZAO RO How long to set the company up? 4 weeks 5 weeks 6 weeks How long to open company bank account? 4 weeks 5 weeks 6 weeks Legal liability? Limited Limited Unlimited Wholly foreign owned? Yes Yes Yes Minimum paid - up share capital? None None None File annual tax return? Yes Yes No Tax registration certificate required? Yes Yes No Recommended corporate bank account? Standard Chartered HSBC Citibank Does our Client need to travel? No No No Resident director required? No No No Resident shareholder required? No No No Minimum directors allowed? 1 2 1 Minimum shareholders? 1 2 1 Tax identification code needed? Yes Yes No Belarus resident representative required? No No No Corporate shareholders allowed? Yes Yes Yes Corporate director(s) allowed? No No No Statutory audit required? Yes Yes No Belarus corporate tax rate? 18% 18% 0% Annual financial statements required? Yes Yes No Regulated by? Ministry of Economy Ministry of Economy Ministry of Economy Allowed to issue sales invoices? Yes Yes No Allowed to sign contracts? Yes Yes No Allowed to import and export goods? Yes Yes No Can rent an office space in Belarus? Yes Yes Yes Can buy Belarus property? Yes Yes No Total Belarus business setup costs in yr. 1? US$9,940 US$7,940 US$11,090 Subsequent annual costs (incl. accounting and tax fee)? US$4,900 US$4,900 US$2,600 Sample engagement invoice? View invoice PDF View invoice PDF View invoice PDF