Directive of the President of the Republic of Belarus
No. 4 of December 31, 2010
On the Development of Entrepreneurship and Stimulating Business Activity in the Republic of Belarus
Our country is well-known for its industrious, educated and talented people. Through their work they can not only improve significantly the welfare and quality of life of the population of the Republic of Belarus, but also to ensure economic growth, security of our state.
Creating favourable conditions for business is one of the main strategic factors in stable socio-economic development of the Republic of Belarus.
Liberation of business initiatives and creativity of citizens contributes to the formation of the developed competitive environment, introduction of new production and management technologies, innovative activities development, creation of new workplaces, saturation of the market with goods and services, increase in tax revenues to the state budget, enhancement of welfare and quality of life.
In recent years obvious positive changes in definition of rules of business conducting aimed at improving business climate and increase of investment attractiveness of our state have occurred in socio-economic development of the Republic of Belarus.
Measures aimed at liberalization of business activities, elimination of unnecessary government interference in the activities of legal entities and individual entrepreneurs, removal of unjustified administrative barriers to business development initiatives have been consistently implemented. The new value assumes a dialogue between the government and business on developing decisions in the field of economic development and stimulating business activities.
However, to ensure the dynamic development of the Belarusian economy much more shall be done to further liberalize business activities.
The Government shall adopt a complex of measures, which would significantly raise the role of the entrepreneurship, actually increase its contribution to the formation of rates of the economic growth, ensuring high efficiency of functioning of the Belarusian economy based on the maximum use of private initiative.
It is no mere chance then that one of the priority directions of socio-economic development of the Republic of Belarus in the next five years is the development of human potential, initiative and entrepreneurship. This means forming of a full-fledged partnership of private and public ownership forms, which is achieved by improving the business climate for all business entities (public and private, domestic and foreign) and in the end - by creation of the barrier-free business environment.
The main principle in this area is competition - wherever possible, state regulation - where necessary.
In order to further liberalize the Belarusian economy, improve competitiveness and create favourable conditions for a dynamic and stable development:
1. Ensure further development of fair business competition regardless of the form of ownership of business entities. For these purposes:
1.1. it is necessary:
to make the transition to market pricing mechanisms that assist in improving the quality and competitiveness of the goods (works, services);
to eliminate the interference of bodies of state administration into the process of price formation by business entities;
to eliminate the limitation of mark-ups in the wholesale and retail trade and mandatory preparation of economic feasibility study of the level of used prices (tariffs) for goods (works, services);
to preserve state regulation of prices only for products of monopoly organizations and socially important goods (works, services) defining the standard of living of the population;
1.2. prevent from inter-regional and other regional constraints upon the implementation of the trade in goods, performance of works (services);
1.3. pursue an open competition and antimonopoly policy aimed at the prevention of monopolistic activity and unfair competition, to achieve the effective functioning of commodity markets;
1.4. ensure the introduction in the Republic of Belarus of possibilities of electronic registration of legal entities and individual entrepreneurs, including the creation of a Web portal of the Unified State Register of legal entities and individual entrepreneurs of the Republic of Belarus.
2. The most serious measures to protect and promote private ownership shall be taken. The conditions for the smooth implementation of the business activities shall be created, which includes without limitation:
2.1. guarantee reservation of rights of ownership and use of this property to good faith purchaser of property. Herewith, it is necessary:
to exclude the adoption (enactment) of normative legal acts providing for the possibility of confiscation of property upon the commission of administrative offences, if these offences are not related to illicit turnover of such property;
to prohibit the confiscation, any other seizure of property from business entities, which are its good faith purchasers. If there is a dispute about the good faith purchaser, that category of cases shall be adjudicated by the courts on a priority basis;
to prohibit acts aimed at deprivation (termination) of property rights of business entities, including the forcible write off of funds from the accounts (except for the collection of taxes, fees (duties), other payments to the budget, the state extra budgetary funds or payments made in accordance with international agreements of the Republic of Belarus), in the absence of a legally effective decision (ruling) of the court;
to guarantee the irreversibility of the privatization of state assets subject to compliance by the subject of privatization with requirements of the legislation;
2.2. ensuring the simplification of procedures for granting land plots to business entities;
2.3. providing to business entities engaged in performance of investment projects on creation of roadside service facilities the incentives related to payment of land tax (lease
payments for the land plots) within two years after the construction of such facilities, other benefits similar to those established for organizations engaged in production activities in rural areas and small settlements;
2.4. It is necessary to exempt:
investors from paying land tax (lease payment) for the land plots occupied for construction of the facilities for a period of time of construction of such facilities, as well as carrying out design works;
legal entities and individual entrepreneurs from payment of fees for the right to enter into the land plot lease contract upon the transfer as the security of a capital structure (building, installation), a preserved uncompleted capital structure, located on the leased land plot, the fee for the right to sign the lease contract in respect of which has not been levied;
2.5. ensuring on the proposals of the local executive and administrative bodies alienation to investors (during implementation by them of investment projects) for one base value of construction facilities and uncompleted construction facilities that belong to the state ownership and have not been used for more than two years;
2.6. granting a priority right to purchase property being in the ownership of state (excluding land plots) to business entities, leasing that property for at least three years, with payment by instalments over five years.
The cost of the sale to a tenant of a leased facility, being in the state property (excluding land plots) shall be reduced by the costs incurred by the tenant for the improvement of the condition and consumer qualities of the object, if these improvements were accounted for upon determining the appraised value and the tenant has not received reimbursement of these costs;
2.7. formalizing in legislation that the performance by the tenant of permanent improvements of leased state property is not a ground for increasing the lease payment of that tenant;
2.8. establishing during the year
3. Excessive administrative barriers upon the interaction between state bodies and legal entities, and citizens shall be eliminated. For this purpose it is necessary:
3.1. to reduce drastically the number of administrative procedures performed in respect of business entities, including by ensuring the implementation of the "single window" principle;
3.2. to prevent the establishment and enforcement in respect of legal entities and individual entrepreneurs of administrative procedures not provided for in laws and international agreements 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 application of electronic document work flow:
in the sphere of performance of administrative procedures in respect of legal entities and individual entrepreneurs on a gratis basis;
in the system of payment of taxes, charges (duties) and other mandatory payments to the budget and state extra-budgetary funds by minimizing the expenses of taxpayers taking into account the creation and development by the National Bank of the Republic of Belarus of the state system of control of open keys for verification of digital signatures;
upon implementation of economic judicial proceedings;
3.4. to create a single internet resource of the administrative procedures perform in respect of legal entities and individual entrepreneurs, providing at that the opportunity for free receipt of forms of documents required for the implementation of these procedures;
3.5. to pass on mainly to declaration of conformity of the goods with mandatory requirements of safety and quality by directly manufacturers, importers and sellers with full entrusting them with responsibility for safety and quality of the goods;
3.6. to recognize in the Republic of Belarus certificates of conformity and other documents, confirming the conformity of products with the mandatory requirements, issued in the states - participants of the Customs Union and in the countries, with which relevant international agreements are concluded;
4. The harmonization of the tax system of the Republic of Belarus with tax systems of European countries shall be finalized. Ensure that tax laws by the nature would be stimulating conscientious performance of tax obligations and business initiative. Extend the application in the Republic of Belarus of international standards in accounting, drastically reduce financial accounting. For these purposes it is necessary:
4.1. to ensure that on continuous basis the work shall be performed to reduce the tax burden, including the issues of distribution of the pension insurance burden between employers and employees;
4.2. to ensure the introduction in the tax system of mechanisms that allow taxpayers who have got losses (including at the early stage of activity) to minimize them at the expense of future profits;
4.3. to create innovation funds solely at the expense of contributions of organizations subordinate to (affiliated with, having the share of state ownership in the authorized capital) of state bodies and state organizations subordinate to the Government of the Republic of Belarus;
4.4. to take measures to improve the scope of the application of the simplified taxation system, providing for the year 2011 its application in the amount of gross revenues not more than 12 billion of roubles as cumulative total throughout the calendar year. The size of limits of revenue in subsequent years should be regularly reviewed;
4.5. to give the right to micro organisations to apply the simplified taxation system with the payment of the value added tax to conduct a simplified accounting of payment of this tax without mandatory accounting in the generally established manner;
4.6. to achieve significant reduction in the list of mandatory for the application primary accounting documents and the number of details in them;
4.7. to increase the maximum amount of proceeds from the sale of goods (works, services) for business entities subject to mandatory audit by the criterion of total volume of revenues;
4.8. to enforce a broad-based application of international financial reporting standards in accounting in the Republic of Belarus;
4.9. to abolish the requirement for business entities relating to mandatory deposit of cash proceeds into the bank, approval of limits of the remainder of cash at the cashier's desk, and for small businesses - also on target use of cash proceeds.
5. The control (oversight) activities shall be made preventive in nature; the passage to the predominant use of preventive measures aimed at preventing offences in conduct of entrepreneurial activities shall be performed. For this purpose it is necessary:
5.1. to ensure the protection of the rights of managers of businesses entities to businessman's risk;
5.2. to establish that:
5.2.1. inspections should not violate the industrial and economic activities of the audited business entities. Any suspension of activity can:
be carried out only in cases defined by legislative acts by a specifically authorized supervisory (oversight) body or by a court solely for the purposes of ensuring national security, protection of life and health of the citizens, protection of the environment;
be extended only by a court order;
5.2.2. routine inspections of business entities, which fulfil conscientiously their obligations to the budget, and in respect of which no violations of the legislation have been registered, shall be held not frequently than once every five years;
5.3. supervisory (oversight) bodies in the exercise in respect of business entities of monitoring and other similar activities that are not inspections are prohibited to use the powers granted to these bodies to carry out inspections;
5.4. preventive punishment measure in the form of detention of persons accused of committing less serious crimes against the order of economic activity (except for manufacturing, storage or sale of counterfeit money or securities, smuggling, and the legalization (“laundering”) of material valuables received by illegal means) - provided that these persons do not hide away from the bodies of the preliminary investigation and (or) the court, shall not be applied;
5.5. the current system of bringing to administrative and criminal penalties for violations in the field of entrepreneurial activities shall be reviewed, and at that the proportionality of liability to the nature of the offence and the extent of the damage inflicted shall be ensured, include without limitation through:
lowering the minimum and maximum amount of fines for committal of administrative offences in the sphere of entrepreneurial activities;
refinement and specification of lists of the circumstances mitigating and aggravating the responsibility. It is necessary to provide in the legislation for reduction of fines twofold in respect of administrative offences upon the presence of mitigating circumstances, including in the cases of voluntary compensation or remedy of the harm arising out of the offence or other adverse consequences of such an offence, or the discharge of the obligation assigned to a relevant person (even at a later date), committing by an individual of administrative offence as the result of a confluence of difficult personal, family or other circumstances;
the scope of application of such type of administrative responsibility as a warning on violations of a formal nature, not involving non-payment (partial payment) of taxes, charges (duties) and other payments to the budget, the state extra budgetary funds, or otherwise causing material harm shall be extended;
the articles of Chapter 12 of the Code of the Republic of Belarus on Administrative Offences of regulations providing for the confiscation of property not owned by the person who committed an administrative offence shall be excluded;
administrative responsibility of legal persons and individual entrepreneurs for administrative offences non related to the receipt by them of any advantage shall be excluded;
5.6. the suspension of bringing to administrative responsibility provided for in Article 23.17 of the Code of the Republic of Belarus on Administrative Offences for violation of the order of preparation (formalizing ) of consignment notes, way bills, payment instructions and other primary accounting documents prior to the entry into force of the law on amending the Code of the Republic of Belarus on Administrative Offences and the Procedural-Executive Code of the Republic of Belarus on Administrative Offences shall be furnished;
5.7. The Council of Ministers of the Republic of Belarus, the Supreme Court, the Supreme Economic Court, the State Control Committee, the General Prosecutor's Office, the National Bank, the General Services Department under the President of the Republic of Belarus, the National Statistics Committee, the local executive and administrative bodies shall organize systematic constructive interaction of supervisory (oversight) bodies and business associations (unions, associations) on the issues of practical application and improvement of the legislation that regulates bringing to the administrative responsibility.
6. Infrastructure and the system of financing of small businesses for the purposes of enhancing business activities and ensuring effective support of business (legal, organizational and financial), particularly at early stages and during the formation of own businesses. Economic incentives for participation in the development of the business environment for business entities belonging to the private form of ownership, public associations, including business unions (associations).
7. Unnecessary regulation of the labour market shall be eliminated. For these purposes it is necessary:
7.1. to expand the rights of employers related to establishment of flexible payment terms for employees, taking into account to the maximum the effectiveness of the contribution of each employee and financial capabilities of business entities;
7.2. to make recommendatory in nature the application of the Unified Wage Tariff System for employees in the Republic of Belarus;
7.3. to expand the application of flexible forms of employment of the population;
7.4. to included the issues of promotion of entrepreneurial and other initiative activities of citizens in all spheres of the economy of the country in skill improvement training programs for managers and specialists of state bodies;
7.5. to establish an effective national system of business education. Non-profit organizations, including entrepreneurial federations (unions, associations), business support centres shall be granted the right to carry out in the established manner of training events in the sphere of management and entrepreneurial activities with independent setting the duration of such training and issuance of certificates according to their own specimen.
9. Unambiguous legal regulation and stability of the legislation shall be ensured, the quality of the preparation of normative legal acts regulating business activities shall be improved. For these purposes it is necessary:
9.1. to establish that in case of uncertainty or indistinctness of requirements of legislative acts courts, other state bodies and other state institutions, officials shall take decisions in favour of business entities and citizens;
9.2. upon adoption of normative legal acts (upon the preparation of relevant drafts) aimed at strengthening and (or) changing conditions of conduct of business, the effective date of such normative legal acts should be established on the basis of a reasonable time that is necessary for business entities to prepare for the implementation of activities in accordance with the requirements set by these normative legal acts, but usually not earlier than three months from the date of their official publication (except the cases, where such normative legal acts are aimed at ensuring economic security, and (or) the implementation of international agreements of the Republic of Belarus, as well as at the improvement of the legal standing of business entities);
9.3. Giving normative legal acts regulating entrepreneurial (business, economic) activities, retroactive effect shall be excluded, except for the acts mitigating or annulling the responsibility for the offences committed upon the conduct of entrepreneurial and other activities, or otherwise improving the conditions for such activities;
9.4. Mandatory public discussions on drafts of acts of the legislation, which may have a significant impact on the conditions of performance of entrepreneurial activities shall be introduced into the practice of republican bodies of state administration and other state organizations subordinated to the Government of the Republic of Belarus, regional executive committees and the Minsk city executive committee, including through the establishment under these public bodies (organizations), public consultation and (or) expert councils with the participation of representatives of business entities and their federations (unions, associations), as well as placing of these projects on the official websites of state bodies and other organizations in the global computer network Internet, and (or) in the mass-media communications.
10. The Council of Ministers of the Republic of Belarus jointly with the National Bank, Regional executive committees and Minsk City Executive Committee shall develop and approve a plan of actions on implementation of the provisions of this Directive indicating the executors and the execution periods within three months.
Governmental bodies and other organizations shall ensure compliance with the provisions of this Directive, including without limitation upon the preparation of drafts of normative legal acts.
11. Personal responsibility for implementing of this Directive shall be placed upon the Prime Minister of the Republic of Belarus, Chairman of the Board of the National Bank, chairmen of the regional executive committees and Minsk City Executive Committee.
12. Control over the implementation of this Directive shall be entrusted to the State Control Committee.
Given the importance of the role of entrepreneurship in the socio-economic development of the country, I c a l l u p o n:
All bodies of state administration, supervisory bodies, local Councils of deputies of all levels, non-governmental associations and citizens to assist actively in implementing the provisions of this Directive.
Only joint efforts, initiative and responsible attitude to our own work will help to ensure stable economic growth of the Republic of Belarus and enhance the welfare of its citizens.
President of the Republic of Belarus A. Lukashenko
* unofficial translation *
© 2011 Belarusian Chamber of Commerce and Industry