Directive of the President of the Republic of Belarus
No. 4 of December 31, 2010
On Developing Entrepreneurial Initiative and Encouraging Business Activity in the Republic of Belarus
Our country is widely known for its hardworking, educated and talented people. Through their activities, they are able not only to improve significantly the welfare and quality of life of Belarus residents, but also to ensure economic growth, and security of our State.
Creating favorable conditions for entrepreneurial activity is one of the principal strategic factors for the sustainable socio-economic development of the Republic.
Emancipation of business initiative and creative potential of citizens contribute to the formation of a well-developed competitive environment, introduction of new production and management technologies, development of innovative activities, creation of new jobs, saturation of the market with goods and services, increase of tax revenues to the state budget, and improvement of welfare and quality of life.
In recent years, the socio-economic development of the Republic of Belarus has undergone obvious and positive changes in the sphere of defining rules for conducting business, aimed at improving the business climate and increasing the investment attractiveness of our State.
Measures to liberalize conditions of economic activities, eliminate the excessive interference of state bodies in the activities of legal persons and individual entrepreneurs and abolishing unjustified administrative barriers are being consistently implemented for the development of business initiatives. A dialogue between government and business in order to develop solutions in the field of economic development and encourage business activity acquires new meaning.
At the same time for ensuring the dynamic development of the Belarusian economy much has to be done on furthering the liberalization of economic activity.
The State is required to adopt complex measures that could significantly raise the role of entrepreneurship, objectively increasing its contribution in the formation of economic growth, ensuring the high operating efficiency of the Belarusian economy on the basis of the maximum use of private initiative.
It is no accident that one of the priorities of the socio-economic development of the Republic of Belarus in the next five years is the development of human potential, initiative and entrepreneurship. This means the formation of a full-fledged partnership of private and state ownership, which is achieved by improving the business climate for all entrepreneurial entities (state and private, domestic and foreign) and in the end – by the creation of a barrier-free business environment.
The main principle in this sphere: competition – wherever possible, state regulation – where necessary.
With a view of further liberalizing the Belarusian economy, improving its competitiveness and creating favorable conditions for dynamic and sustainable development:
1. To ensure the further development of fair competition between entrepreneurial entities, regardless of ownership. For these purposes:
1.1. it is necessary to:
make a transition to market pricing mechanisms facilitating the improvement of quality and competitiveness of goods (works, services);
eliminate the interference of bodies of state administration in the process of price formation of entrepreneurial entities;
eliminate the limitation of charges in wholesale and retail trade and the mandatory preparation of economic justification for using price levels (tariffs) for goods (works, services);
preserve state regulation of prices only for the products of monopoly organizations and socially important goods (works, services) defining the standard of living of the population;
1.2. to prevent the establishment of inter-regional and other regional constraints in the carrying out of trade in goods, execution of works (rendering services);
1.3. to conduct an open competition and antitrust policy aimed at the prevention of monopolistic activity and unfair competition and the achievement of the efficient functioning of commodity markets;
1.4. to ensure the introduction in the Republic of Belarus of a possibility of electronic state registration of legal persons and individual entrepreneurs, including the creation of the Web portal of the Unified State Register of Legal Persons and Individual Entrepreneurs of the Republic of Belarus.
2. To take the most serious measures to protect and develop private ownership. To create conditions for unimpeded carrying out of entrepreneurial activity, including:
2.1. to ensure for bona fide purchasers of property the preservation of ownership rights and use of this property. In doing so:
to eliminate the adoption (issuance) of normative legal acts providing a possibility of confiscation of property upon the commission of administrative offenses, unless these offenses are related to illegal trafficking of such property;
to prohibit the confiscation, seizure of property from entrepreneurial entities which are its bona faith purchasers. If there is a dispute about the bona fide status of the purchaser, that category of cases is to be considered by the courts on a priority basis;
to prohibit actions aimed at the extinction (termination) of property rights of entrepreneurial entities, including the enforced transfer of monetary funds from accounts (except for the collection of taxes, dues (duties), other payments to the budget, state non-budget funds or payments made in accordance with treaties of the Republic of Belarus) in the absence of a court decision (ruling) that has entered into force;
to guarantee the irreversibility of the privatization of state property subject to observation of legislation requirements by the subject of privatization;
2.2. to ensure the simplification of procedures for granting land plots to entrepreneurial entities;
2.3. to provide to entrepreneurial entities engaged in investment projects for creating roadside service facilities land tax benefits (rent payment for land plots) for two years after the end of construction of such facilities, and other benefits similar to those established for organizations engaged in productive activities in rural areas, small settlements;
2.4. to exempt:
investors from payment of land tax (rent payment) for land plots occupied for the construction of facilities for the period of construction of such facilities, as well as carrying out design work;
legal persons and individual entrepreneurs from making payment for the right to conclude the land lease contract when pledging a capital structure (building, construction), unfinished capital structure prepared for preservation, located on the leased land plot concerning which the fee for the right to conclude the lease contract was not levied;
2.5. to ensure, on proposals of local executive and administrative bodies, the alienation of immovable property objects and unfinished construction objects, being in the state ownership and not used more than two years, to investors (when they implement investment projects) for one base unit;
2.6. to grant a priority right to purchase property being in the state ownership (except land plots) to entrepreneurial entities renting this property for at least three years with payment by installments over five years.
The value of a lease object being in the state ownership (except land plots), when selling it to the lessee, shall be reduced by the expenses incurred by the lessee on the improvement of state and consumer qualities of such object, if these improvements were taken into account when determining the assessed value and the lessee has not reimbursed for the expenses;
2.7. to provide in legislation that integral improvements to leased state property, made by the lessee, shall not be a ground for increasing the rent payment for this lessee;
2.8. to establish, during 2011, a single information base about unused state property intended for sale and lease, and to ensure an open and free access to it for all users of the global computer network Internet.
3. To eliminate excessive administrative barriers for the interaction between state bodies, legal persons and citizens. For this purpose:
3.1. to reduce drastically the number of administrative procedures performed in relation to entrepreneurial entities, including by ensuring the implementation of the one-stop principle;
3.2. to prevent the establishment and enforcement, in relation to legal persons and individual entrepreneurs, of administrative procedures not provided for in the laws and treaties of the Republic of Belarus, decisions of the Head of the State and the Government of the Republic of Belarus;
3.3. to ensure the maximum expansion of the scope of electronic document circulation:
in the sphere of performing administrative procedures in relation to legal persons and individual entrepreneurs on a free-of-charge basis;
within the payment system of taxes, duties (dues) and other obligatory payments to the budget and non-budget state funds, by minimizing the expenses to taxpayers having regard to the creation and development by the National Bank of the Republic of Belarus of a state system of management of public keys to verify electronic digital signatures;
while carrying out economic judicial procedure;
3.4. to create the single Internet resource of administrative procedures performed in relation to legal persons and individual entrepreneurs, providing the possibility of getting free forms of the documents required for the performance of these procedures;
3.5. to introduce the declaration of the conformity of goods to the obligatory requirements of safety and quality directly predominantly by manufacturers, importers and vendors while fully imposing on them the responsibility for safety and quality of goods;
3.6. to recognize in the Republic of Belarus certificates of conformity and other documents confirming the conformity of products to the obligatory requirements, which are issued in the states – participants of the Customs Union and the states with which respective treaties have been concluded.
4. To complete the harmonization of the tax system of the Republic of Belarus with those effective in the European countries. To make tax legislation promoting the bona fide fulfiment of tax obligations and business initiative. To expand the application, in the Republic of Belarus, of international accounting standards, reducing drastically financial reports. For these purposes:
4.1. to ensure, on a permanent basis, performance of work to reduce the tax burden, including the distribution of the pension insurance burden between employers and employees;
4.2. to ensure the implementation into the tax system of mechanisms allowing the taxpayers who have suffered losses (including in the beginning of activities), to minimize them from future profits;
4.3. to create innovation funds solely through the contributions of organizations subordinated to (making part of, having the share of state property in the statutory funds) the state bodies and state organizations subordinated to the Government of the Republic of Belarus;
4.4. to take measures to improve the scope of application of the simplified tax system, providing its application for 2011, when the amount of cumulative gross income does not exceed 12 billions rubles during the calendar year. To review regularly the maximum amount of revenue in subsequent years;
4.5. to grant the right to micro-organizations applying the simplified tax system with payment of the value added tax, to maintain a simplified record of payment of the mentioned tax without obligatory accounting in accordance with the standard procedure;
4.6. to ensure a significant reduction in the list of primary accounting documents, obligatory for application, and the number of details therein ;
4.7. to increase the maximum amount of revenue from the realization of goods (works, services) for entrepreneurial entities subject to obligatory audit according to the criterion of total revenue;
4.8. to ensure the application in the Republic of Belarus, on a wide basis, of international financial reporting standards in the accounting;
4.9. to cancel the requirements for entrepreneurial entities on handing over the cash proceeds in the bank, agreeing limits of the remainder in cash, and for small entrepreneurship also the requirement concerning the intended use of cash proceeds.
5. To make the control (supervisory) activities precautionary in nature, to change over to a predominant use of preventive measures aimed to prevent offences in the entrepreneurial activities. For this purpose:
5.1. to ensure the protection of the right of the heads of entrepreneurial entities to business risk;
5.2. to establish that:
5.2.1. inspections shall not violate the manufacturing and economic activities of inspected entrepreneurial entities. Any suspension of activities may be:
carried out only in the cases determined by legislative acts by a specially authorized control (supervisory) body or by the court solely for the purpose of ensuring national security, protection of life and health of citizens, environment protection;
extended exclusively by a court decision;
5.2.2. scheduled inspections with regard to entrepreneurial entities conscientiously fulfilling obligations before the budget and having no violations of legislation, shall be held not more frequently than once every five years;
5.3. control (supervisory) bodies, while carrying out monitoring and other similar activities, not being inspections, in relation to entrepreneurial entities are prohibited to use powers granted to these bodies for holding inspections;
5.4. not to apply preventative punishment in the form of detention for those persons accused of commission of less serious crimes against the order of carrying out economic activities (with the exception of manufacturing, storage or sale of counterfeit money or securities, smuggling and legalization (laundering) of material valuables gained by criminal means), – provided that those persons do not flee from the bodies of preliminary investigation and/or the court;
5.5. to review the existing system of administrative and criminal liability for offences in the sphere of entrepreneurial activities ensuring the proportionality of the liability to the nature of the offence and the harm caused, including by:
reducing minimum and maximum amounts of fines for the commission of administrative offences in the sphere of entrepreneurial activities;
refinement and specification of the list of mitigating and aggravating circumstances. It is necessary to provide in the legislation the reduction of the amounts of fines twofold under administrative offences upon availability of mitigating circumstances, including in the cases of voluntary compensation or elimination of the harm arising as a result of a committed offence or other adverse consequences of such an offence or the discharge of with the obligation (even afterwards) imposed on the respective person, commission by the natural person of an administrative offence as a result of the confluence of difficult personal, family or other circumstances;
expanding the scope of application of such type of administrative liability, as admonition concerning the offences of a formal nature not involving non-payment (partial payment) of taxes, dues (duties) and other payments into the budget, state non-budget funds or causing other material harm;
exclusion from the articles of chapter 12 of the Code of the Republic of Belarus on Administrative Offences of norms providing for the confiscation of property which is not in ownership of the person who committed the administrative offence;
exclusion of administrative liability of legal persons and individual entrepreneurs for administrative offences not related to their obtaining any benefit;
5.6. to ensure the suspension of bringing to administrative liability provided for in article 23.17 of the Code of the Republic of Belarus on Administrative Offences, for violation of the order of completion (drawing up) of invoices, consignment notes, payment instructions and other primary accounting documents prior to the entry into force of the law on bringing the respective changes into the Code of the Republic of Belarus on Administrative Offences and the Procedural Code of the Republic of Belarus on Administrative Offences;
5.7. The Council of Ministers of the Republic of Belarus, the Supreme Court, the Supreme Economic Court, the Committee of State Control, the General Prosecutor Office, the National Bank, the Administration of Affairs of the President of the Republic of Belarus, the National Statistical Committee, local executive and administrative bodies shall organize systematized constructive interaction of control (supervisory) bodies and the amalgamation of entrepreneurs (unions, associations) on the practical application and improvement of legislation regulating the procedure of bringing to administrative liability.
6. To improve infrastructure and system of financing small entrepreneurship to enhance entrepreneurial activities and ensure efficient support of entrepreneurship (legal, organizational and financial), especially in the beginning stages and the establishment of their own business. To form economic incentives for participation in development of business environment of entrepreneurial entities of private ownership, public associations, including entrepreneurial unions (associations).
7. To eliminate excessive regulation in the labour market. For these purposes:
7.1. to expand the rights of employers to establish flexible terms of payment for labour of employee taking into account the effectiveness of contribution of each employee and the financial capacities of entrepreneurial entities;
7.2. to make the implementation of the Unified tariff system of workers of the Republic of Belarus as a recommendation;
7.3. to expand the application of flexible forms of employment of the population;
7.4. to include in the retraining programs for managers and specialists of state bodies issues of encouraging entrepreneurial initiative and other activities of citizens in all spheres of economy of the country;
7.5. to establish an effective national system of business education. To grant non-commercial organizations including entrepreneurial amalgamations (unions, associations), and entrepreneurial support centers the right to carry out in due course educational measures in the sphere of management and entrepreneurial activities with self-setting terms of such training and issuing the certificate of their own sample.
8. To form a legal base encouraging the development of mechanisms of public-private partnership in the Republic of Belarus.
9. To ensure unambiguous legal regulation and stable legislation, to improve the quality of preparing normative legal acts regulating entrepreneurial activities. For these purposes:
9.1. to establish that in the case of ambiguity or vagueness of prescriptions of the acts of legislation, the courts, other state bodies and other state organizations, officials shall take decisions in favor of entrepreneurial entities and citizens;
9.2. when adopting normative legal acts (preparing respective drafts), establishing and/or changing business conditions, the date of the entry into force of such normative legal acts shall be established based on a reasonable time periods necessary for entrepreneurial entities to prepare for carrying out activities in accordance with the requirements being established by those normative legal acts, but, as a rule not later than three months from the date of their official publication (with the exception of cases when such normative legal acts are aimed at ensuring the economic security of the country and/or the implementation of treaties of the Republic of Belarus, as well as to improve the legal status of entrepreneurial entities);
9.3. to exclude the adoption of normative legal acts regulating entrepreneurial (economic) activities retroactively with the exception of the acts which mitigate or annul the liability for the offence in the carrying out of entrepreneurial or other activities or otherwise improve the conditions of such activities;
9.4. to introduce into the practice of republican bodies of state administration and other state organizations subordinated to the Government of the Republic of Belarus, regional and Minsk City Executive Committee obligatory public discussion of draft acts of legislation which may have a significant impact on the conditions of carrying out entrepreneurial activities including through the establishment of these state bodies (organizations), public consultation and/or advisory councils with the participation of representatives of entrepreneurial entities, their amalgamations (unions, associations) as well as the placement of mentioned drafts on the official websites of state bodies, other organizations in the global computer network Internet and/or mass media.
10. The Council of Ministers of the Republic of Belarus jointly with the National Bank, regional and Minsk City Executive Committee shall, within three months, develop and approve a plan of actions to implement the provisions of the present Directive, indicating the executors and execution terms.
State bodies and other organizations shall ensure compliance with the provisions of the present directive, including while preparing of draft normative legal acts.
11. To impose personal responsibility for the execution of the present Directive on the Prime-minister of the Republic of Belarus, Chairman of the Governing Board of the National Bank, chairmen of regional and Minsk City executive committees.
12. To impose the control over the implementation of the present Directive on the Committee of State Control.
Giving the importance of the role of entrepreneurship in social economic development of the country, I call upon:
all the bodies of state administration, control bodies, local Councils of deputies of all levels, public associations and the citizens to render active assistance in implementation of the provisions of the present Directive.
Only joint efforts, initiative and responsible attitude toward everyone’s own work will allow ensuring the stable economic growth of Belarus and raising the welfare of citizens.
President of the Republic of Belarus
* unofficial translation *