As a general rule payments between legal entities and individual entrepreneurs in Belarus are carried out on a cashless basis. Nevertheless, some transactions between legal entities and their separate parts and individual entrepreneurs (hereinafter – business entities) are permitted in cash.
Cash transactions are carried out for the obligations arising from civil-law relations including by depositing money directly to banks and charging this payment in the current (settlement) bank account. The total amount of cash settlements cannot exceed 300 basic units (at the date of 01.01.2014 base unit is about 10 euro) in a day.
Except bank cash registers the receiving of cash from business entities in the amount of not more than 300 basic units is carried out by:
Cash payments to the budget and state budget funds are made without size limits.
Some legal entities and individual entrepreneurs are not allowed to make cash transactions. They are:
The sources for the cash payments are:
1.1. The procedure of using the cash
Cash of legal entities, branches and individual entrepreneurs, who have opened operating bank account (hereinafter – business entities), is subject to mandatory transferring and keeping in appropriate accounts in the banks.
Business entities must deliver cash through their authorized persons:
Business entities determine the procedure and the deadlines for delivering of the revenue themselves in the written order of the chief executive of the business entity.
Business entities may spend the cash from the revenue to meet their needs arising during their activity (including for the payments into the budget, state funds), in the order and amount, specified in the legislation for the implementation of future expenses (subject to the existence of such amounts). For example, for using cash from the revenue for travel expenses the business entities should take into account the norms of reimbursement of travel expenses, established by the Belarusian legislation.
Cash can also be received by the business entities in the serving banks for the purposes, established by law, and must be spent for the purposes indicated in the receipt, according to which this cash was received.
1.2. Financial statements
Annual financial accounting reports of business entities are the primary source of information about the results of their economical activity and their financial condition. It allows to find out about the income and expenditures incurred by organizations, contribute to the prevention of negative results of the economic activities of the organization and reveal reserves for its financial stability.
These reports are of interest not only to these business entities and their parent organizations, but also to external users: controlling state bodies, banks, credit organizations, counterparties and etc., because they provide information about the presence and movement of assets and liabilities, as well as about the use of materials, labor and financial resources in accordance with approved standards.
The Ministry of Finance of the Republic of Belarus is the governmental body that provides method guidance of accounting reports and determines composition of annual financial accounting reports, i.e. in what order it should be compiled and in what way it should be presented to the interested persons.
An organization prepares the accounts for the period of month, quarter and year. In this case, monthly and quarterly financial accounting reports are the intermediate reports.
Nowadays, annual financial accounting reports of Belarusian legal entities include the following documents:
1. balance sheet;
2. profit and loss report;
3. statement of capital changes;
4. statement of cash flow.
Organization’s financial accounting reports for the month consist of balance sheet.
Organization’s financial accounting reports is composed with considering of activity indicators of its branches, representative offices and other separate units, including those with separate balance.
Some business entities have the right not to exercise bookkeeping and accounting and keep records in a special book (ledger) for recording income and expenses. Such entities include organizations with number of employees up to 15 inclusive (average for period since the beginning of the year of the reporting period) and individual entrepreneurs, the amount of gross revenue which cumulatively from the beginning of the year does not exceed 4 100 000 000 Belarusian rubles, if they have applied the simplified system of taxation, except:
Organizations must represent the annual accounting not later than 31 March of the year following the reporting year.
Mandatory publication of annual accounting reports is provided by the laws of Belarus for the following subjects:
Other organizations can publish their annual accounts at will.
For the infringement of the procedure of making financial accounting reports there is an administrative liability in the form of warning or fine ranging from 4 to 20 basic units (at the date of 01.01.2014 base unit is about 10 euro).
Currently the first steps to the international financial reporting standards (hereinafter IFRS) introduction has already taken in the Republic of Belarus. From 2016 public-interest organization - open joint stock companies, which are the founders of the unitary enterprises and (or) the main business companies in respect of the subsidiary, banks and nonbank credit and financial organizations, insurance organizations - will be obliged to prepare annual accounting in accordance with IFRS.
The main legal act that regulates relationships in the field of pricing in the Republic of Belarus is the law of the Republic of Belarus of May 10, 1999 No 255-З “On pricing”.
As a general rule in Belarus there are free prices (tariffs) used in respect of goods (works, services).
The exception to this rule is regulation of prices (tariffs) in respect of:
As for regulated goods (works, services) republican state administration bodies, regional and Minsk city executive and administrative bodies within the powers granted to them by law shall effect (administrative) regulation of prices (tariffs) by setting:
The number of legal acts is dedicated to regulation of the Banking system of Belarus. The main legal act in this field is the Banking Code of the Republic of Belarus. According to the provisions of the Code, the Banking system of Belarus consists of:
Non-banking credit and financial institutions unlike the banks do not have the right to exercise the following banking operations:
The main principles of banking activities include the following:
1. obligatory licensing of banks and non-banking credit and financial institutions engaged in banking activities (hereinafter – Banking License);
2. independence of banks and non-banking credit and financial institutions in their activities and non-interference of government authorities, except for occasions, provided by laws of the Republic of Belarus;
3. division of liabilities among banks, non-banking credit and financial institutions and the state;
4. compliance with safety functioning standards introduced by the National Bank of the Republic of Belarus (hereinafter – the National Bank) to ensure stability and soundness of the banking system in the Republic of Belarus.
5. the right of individuals and legal entities to choose banks and non-banking credit and financial institutions at their discretion;
6. guarantees of confidentiality of clients transactions, accounts and deposits;
7. guarantee of recovery of funds placed by bank depositors.
5. Bank authorized fund
A bank authorized fund shall be formed by contributions (assets) of its founders (shareholders). The authorized fund of bank comprises the minimum amount of the bank assets to safeguard the interests of its creditors.
A minimum amount of the bank authorized fund is determined by the National Bank upon approval of the President of the Republic of Belarus. Under resolution of the Council of the Board of the National Bank of the Republic of Belarus of May 28, 2012 No 249 “About a minimum amount of the bank authorized fund”, as of January 1, 2013, a minimum amount of the bank authorized fund is to be established in Belarusian rubles in the amount equivalent to 25 000 000 Euros.
On establishing a bank the minimum amount of its authorized fund shall be formed solely by means of cash contributions from its founders. Formation of an authorized fund shall be formed solely by means of own funds of the bank shareholders, and an increase of the authorized fund can be made by means of own funds of the bank shareholders (owner of assets), of other persons, and/or sources of own funds of the bank.
Own funds of shareholders (owner of assets), other persons comprise legitimately acquired financial resources or other assets owed by the named persons by virtue of ownership or other proprietary rights. Sources of the bank own funds are the retained earnings of the bank or the funds, established from the bank profits, in cases if such funds were not used.
The property that is used in banking activity and that is related to fixed assets, except the unfinished construction objects, could be used as a non-monetary contribution to the bank authorized fund.
Monetary contributions to the bank authorized fund shall be made to a temporary account opened by the bank founders or by the bank in case of its authorized fund increase at the National Bank or other bank as agreed with the National Bank. In case of opening the temporary account at the other bank, monetary contributions are made to this temporary account through the correspondent account of this bank, opened in the National Bank of the Republic of Belarus.
Opening of the temporary account is not obligatory in cases of:
According to Belarusian legislation banking is a licensed activity. Banking Licenses, including the list of banking operations which the bank is entitled to exercise, are issued by the National Bank.
The Bank is obliged to apply to the National Bank for receipt of a license to exercise banking activities within ten months from the date of state registration.
To obtain a banking license the Bank must comply with the licensing requirements which are established by the National Bank.
Decision on the issue of license (refusal to issuance), on introduction of changes and (or) additions (refusal to introduction) to the list of banking operations specified in the license issued to the bank is made by the National Bank within a period not exceeding two months from the date of submission to the National Bank of documents required to obtain a license, for introduction of changes and (or) additions to the list of banking operations specified in such license.
Founders of the bank may apply to the National Bank for receipt of a license at the same time together with the request of the state registration of the bank on condition of implementation of license requirements. The period of making a decision on the issue of license may be extended to three months by the National Bank.
If the bank does not receive a license within twelve months from the date of its registration, such bank is subject to liquidation by the decision of its shareholders or bank authority authorized by the statute, or by the court at the suit of the National Bank.
The bank must have a stable financial position over the last two years or since obtaining a license, if the license has been obtained less than 2 years ago, to obtain the right to exercise banking operations of funds raising of individuals to the accounts and (or) to the deposits, opening and maintaining of bank accounts of individuals. It is imperative that the bank's regulatory capital is in the amount of 25 million euro (50 million euro if the banking license has been obtained less than 2 years ago) as of the first month of submitting the documents to the National Bank for introduction of changes and (or) additions to the list of banking operations which the bank is entitled to exercise.
The limit (quota) for foreign capital participation in the banking system of the Republic of Belarus is set by the National Bank upon the approval of the President of the Republic of Belarus. As of January 1, 2014 the limit (quota) is set at no more than 50 percent. The said quota shall be calculated as the ratio of total non-resident capital in aggregate authorized funds of banks with foreign investment and subsidiaries of foreign banks, and the total authorized fund of banks registered in the Republic of Belarus.
The National Bank shall stop registration of banks with foreign investment once foreign capital participation in the banking system of the Republic of Belarus reaches the established limit (quota).
Banks with foreign investment shall be obliged to submit advance applications to the National Bank for authorization of increases in the bank authorized fund using non-resident resources and (or) disposal of shares to non-residents. Applications shall be considered by the National Bank within thirty days from the date of submission.
Transactions involving disposal of shares to non-residents that are concluded without authorization of the National Bank shall be deemed void.
The National Bank shall be entitled to forbid any increase in the authorized fund of a bank using non-resident resources and (or) any disposal of shares to non-residents where such actions would result in the limit (quota) for foreign capital participation in the banking system of the Republic of Belarus being exceeded.
The Government of the Republic of Belarus on the proposal of the National Bank shall be entitled to introduce restrictions on banking operations for banks with foreign investment if the respective foreign states operate similar restrictions on the activities of banks with investment by Belarusian citizens and (or) legal entities.
Foreign banks are entitled to open representative offices in the Republic of Belarus.
8 representative office of a foreign bank are registered as of January 1, 2014 in the Republic of Belarus.
A representative office of a foreign bank is not regarded as a legal entity and carries out its activity basing on the Regulation approved by the parent bank by which it was established.
A representative office of a foreign bank shall not be entitled to carry out banking operations and other activities, except for protection and representation of interests of the parent bank by which it was established, including consulting and (or) information services.
The decision on authorization of opening of a foreign bank representative office or denial of such authorization shall be made by the Board of the National Bank within two months from the date of submission of the documents.
Denial of application for opening a representative office of a foreign bank may be passed due to the following:
Representative offices of foreign banks in the Republic of Belarus shall be established for a maximum term of three years. The operating term of a foreign bank representative office may be extended by the Deputy Chairman of the Board of Director’s decision at the request of the respective foreign bank provided that the foreign bank applies to the National Bank not later than one month before the expiry of the permit to establish a representative office. Decision on prolongation of the operating term of a foreign bank representative office is made within a period not exceeding one month from the date of submission of such petition.
If such request is not submitted within the specified term, the representative office record is excluded from the register of foreign bank representative offices, and the National Bank notifies the foreign bank of the case within five days.