Unified law on investment operations to improve investment climate in Belarus
MINSK (BelTA) – A unified law on investment operations will help improve the country's investment climate. Chairman of the Council of the Republic of the National Assembly of Belarus Mikhail Myasnikovich made the statement during the expanded participation session of the Presidium of the Council of the Republic of the National Assembly of Belarus on 24 August, BelTA has learned.
Mikhail Myasnikovich noted: “I believe that the development and adoption of the unified law on investment operations will contribute to improving the investment climate and enabling favorable terms for investment operations. The law contains direct-effect norms.”
In his words, over 40 government agencies perform state regulatory functions in the sphere of investments and 34 legal acts regulate investment relations.
“The versatility of legal regulation sources leads to another problem — the absence of legal stability for economic operators. It is a very important factor for investors,” stressed Mikhail Myasnikovich. “Apart from that, investors have serious concerns about the enforcement of these regulations. Penal sanctions enacted as part of investment contracts are incommensurable with detected violations.”
According to the head of the upper chamber of the Belarusian parliament, it is necessary to more widely practice warnings or notifications about the inadmissibility of violations as the first response measure instead of fines or more serious punishments.
The prerogative right of the oblast administrations and the Minsk city administration to buying some categories of corporate shares and the ability of municipal government agencies to terminate investment contracts even for minor lapses with regard to project implementation time represent another obstacle on the way of foreign investments.
The official added that the existing moratorium on auditing newly established enterprises, which make capital investments, has a weak effect on the development of investment operations not only in small businesses but major greenfield projects, too. To address the situation, it is necessary to amend the laws on investments, concessions, architectural, town planning and civil engineering activities, it is necessary to adopt a new law on investment funds and to adjust several provisions of the Civil Code and the Tax Code.
It is also necessary to expedite the legal confirmation of public private partnership mechanisms. The law on public private partnership that was adopted in 2015 is a framework document to a large extent. Yet it created the legal foundation for modernization and for private investors to create public infrastructure. However, budget planning and taxation matters require additional detailed legal base.
Mikhail Myasnikovich stressed that investments represent a high priority for Belarus' development and are viewed as one of the sources for raising the GDP. The Council of the Republic of the National Assembly has already done some work to analyze the relevant legislation. “Certain issues have been unearthed, ways to address them have been suggested. Information has been forwarded to agencies concerned,” added the official.
Foreign direct investments should play the key role in invigorating investment operations. A favorable investment climate is needed to bring FDI to Belarus, believes the head of the upper chamber of the Belarusian parliament. In his words, the participation of foreign companies in investment operations in Belarus represents a source for modernizing the real sector and gives access to information technologies as well as trade and logistics networks of transnational corporations.