During the last years, Belarus’ IT sector has received strong state support as it is one of the key fields of development. Particular attention is paid to the so-called Belarus High Technologies Park (HTP) located in Minsk – a special economic zone with a special tax and legal regime in the Republic of Belarus, the Belarusian counterpart of Silicon Valley in the USA. The HTP is the only organization in the country that is entitled to systematically grant tax benefits. Resident companies are exempt from most taxes, including value-added tax and income tax.
In December 2017, Belarusian President Alexander Lukashenko signed the Decree on the Development of Digital Economy in Belarus. This is a unique document for HTP’s business activities as it has the potential to turn Belarus into a business platform of international importance. The decree will come into force on 28 March 2018.
These are the changes resulting from the decree:
- The HTP will be open to new companies, also to investment funds (including venture capital funds) and IT education projects. These companies will be entitled to do any business aimed at monetizing software products.
New HTP residents could, for example, be:
- companies that organize ICOs (Initial Coin Offering), crypto platform operators, cryptocurrency exchange offices and miners,
- fintechs and companies engaged in the training of neural networks, the development of drones, biotechnologies, solutions for aviation and space;
- Due to the decree, Belarus will be able to offer very attractive possibilities regarding the use of blockchains and cryptocurrencies. In particular, HTP residents will be able to get involved in crypto exchange services, obtain financing through ICOs and use cryptocurrencies and tokens in civil circulation.
- The decree has lifted many restrictions on financial operations for IT companies, such as exchange controls and restrictions on capital movement.
- The decree also implies a new immigration policy making a work permit dispensable for foreigners who enter into an employment contract with an HTP resident. HTP residents, in turn, will not need a permit to hire foreign employees. In addition, foreign employees of HTP residents as well as founders (members) of HTP residents do not need a Belarusian visa.
- HTP residents will be allowed to conclude option contracts, convertible loan agreements, non-compete obligations with employees, agreements on the enticement of employees, irrevocable powers of attorneys and other internationally accepted documents. This will be possible due to individual English law institutions adopted by the HTP.
Whether the decree will turn Belarus into an IT mecca is soon to be seen. Anyway, a simple registration process will allow a foreign company to start working in the HTP immediately. It will only be necessary to establish a legal entity in the Republic of Belarus and apply for registration in the HTP providing copies of association articles and the state document of registration as a legal entity and business project.