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Dear clients and cooperation partners,
We are pleased to inform You that Belarus has adopted unique legal regulation in IT sphere.
21 December 2017 President signed Decree On the Development of the Digital Economy fixing progressive and unique regulation in the IT sphere on a global scale.
Please see a brief overview of the innovations that will come into force on 28 March 2018.
Blockchain, cryptocurrencies, and ICO
The Decree devotes special attention to the development of blockchain technologies and cryptocurrency payments.
Tokens are recognised as a legitimate object of legal relations. Tax privileges are introduced to operations with tokens, including trade in cryptocurrencies and ICO. Until 2023 individual revenues from mining and operations with tokens are not subject to declaration and taxation depending on the categories of the subject: a resident of the Belarus High-Tech Park (HTP), an individual, or another entity.
Additionally, special status of a cryptographic platform operator and cryptocurrency exchange is introduced. The Decree sets for them a minimum security value to be stored at Belarusian banks: not less than equivalent of USD 500,000 and USD 100,000, respectively.
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High-Tech Park
HTP was established in 2005 in Belarus to create favourable conditions for software development and the ICT progress. HTP resident may actually be located outside the territory of the Park. Having successfully operated for over 10 years, the HTP regime is now extended until 2049.
At present, 192 companies are already registered as residents of HTP, 6 of them are included in the rating of The 2017 Global Outsourcing 100.
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Privileges and benefits for HTP residents
Simplified rules of company document control: for example, local legislation on control of foreign trade operations is not applied, and simplified unilateral invoices may be used by HTP residents with foreign parties.
Exemption from corporate taxes (VAT, income tax); there is a 1% company's income fee instead.
HTP residents in relations between themselves and third parties will be able to use the following legal instruments borrowed from UK law, thus far not available to other companies in Belarus:
- non-compete and non-solicitation agreements;
- convertible loan;
- option agreement;
- indemnification agreement;
- investment partnership agreement;
- irrevocable power of attorney.
Simplified system for foreign founders and employees: foreign employees and founders of HTP resident companies are entitled to visa-free entry to Belarus, the maximum period of their temporary stay is extended to 180 days. Residents of HTP do not need to receive a special permit for hiring foreign employees.
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Types of activity in the HTP
HTP residents can perform the following types of activity:
- operations based on blockchain, as well as with smart contracts, cryptocurrencies and tokens (including ICO);
- develop and apply software;
- business processes outsourcing;
- create audio-visual, music, and video materials;
- activity in the sphere of cybersport etc.
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How to become a HTP resident?
- Register a company in Belarus.
- Prepare a business plan according to HTP’s guidelines.
- Conduct one or several types of activity stipulated by law on HTP.
- Obtain resident status from HTP Administration based on an application and the above mentioned business plan.
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Remarkable recent transactions with HTP residents
Google acquires AIMATTER
Google acquired AIMATTER, a Belarusian AI start-up and a developer of Fabby app.
Gett acquires Juno
Global online taxi service Gett available in more than 100 cities around the world acquired its competitor Juno with R&D centre in Belarus.
Facebook acquires MSQRD
Facebook Inc. acquires Masquerade Technologies Inc., a Belarus based maker of MSQRD app.
Mindspark Interactive Network acquires Apalon
Apalon Technologies, a Belarusian company and one of the TOP-10 world leaders in mobile software development for iOS, sells its business of mobile software to Mindspark Interactive Network. The latter is owned by NASDAQ quoted Inter Active Corp.
Chinese consortium acquires Playtika
Chinese consortium that included online game developer and operator Shanghai Giant Network Technology Co, acquired Playtika, the social and mobile games company based in Herzliya, Israel, owned by Caesars Interactive Entertainment, with a strong development team located in Minsk, Belarus.
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How we can help
Sorainen Law Firm provides legal support with HTP regime. In particular, we can assist with:
- Analysis of business model compliance with the requirements to HTP residents.
- Company establishment in Belarus and opening a bank account.
- Preparing the set of document for registration as a HTP resident.
- Support of registration with the HTP.
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International coverage
The news appeared in the leading global media, including New York Times, Daily Mail, CNBC, Euronews, US News, Reuters, Business Insider.
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