There are a lot of legislative updates coming out of Belarus according to Revera Managing Partner Dmitry Arkhipenko, who highlights those on tax liability, company law, labor law, data protection, currency control, and the legal profession itself.
First, Arkhipenko reports that an exemption of criminal liability was introduced in tax law, “provided the offender repays the due taxes in full and also covers losses in the same sum.” He noted that the authorities have been very active in controlling tax obligations. “We see a lot of criminal cases in the field, so this was important.”
On company law, Arkhipenko says the changes were quite significant. “For instance, previously you could not conclude shareholder agreements with all the shareholders of a company, but this limitation was canceled.” He also notes some quality-of-life improvements were made. On labor legislation, for example, “the possibility of remote work was introduced, and remote work was regulated”.
From November 15, 2021, onward, Belarus will have data protection legislation, according to Arkhipenko. “Unlike in the EU, in Belarus, the circulation of personal data did not face any serious regulation. All companies working with personal data will now need to implement consent mechanisms and processing policies, and the National Center for Personal Data Protection was created, as a state regulator.”
Serious changes were made on currency regulation, for both individuals and legal entities, he reports. “A special permission was required for many capital currency operations – opening accounts, purchasing real estate or stocks, capital fund contributions, and others. A simple procedure of electronic notification was introduced.”
The most impactful change on the legal profession, however, is the recent update of the Law on Advocacy, according to Arkhipenko. “The advocacy bureau and the individual advocacy practice are being discontinued. Legal Consultation Offices (LCOs), established by regional Bar associations, will be the only possible form of practicing advocacy.” Advocates in those LCOs will work separately from each other, he says. “Clients will not be able to enter into a legal assistance agreement with some entity, group of advocates, or several advocates simultaneously and there is, apparently, no option for an advocate to hire another advocate. This means that advocates will only conduct individual practices under the LCO. Advocates will still have a monopoly on court representation, conducting criminal cases, and advising natural persons on nonbusiness matters,” he explains.
Arkhipenko does note that Belarusian legislation provides two forms of legal practice: advocacy on the one side, and law firms on the other. “Law firms will not be able to offer services such as litigation or representation in criminal cases. Prior to the advocacy reform, we also had an advocacy bureau. We currently have alliances with 15 advocates. We’re endeavoring to preserve our litigation practice and safeguard our staff.”
For the legal market, this might mean a decrease of structured groups, an increased number of individual advocates in LCOs, and not much growth, according to Arkhipenko. “It is necessary to admit, however, that it’s difficult to focus on several spheres, as an individual practitioner. It might become increasingly hard to find firms that can provide a deep, thorough, and complex approach to the matters.”
On the business side, Arkhipenko reports an increase in requests from businesses looking to expand abroad, especially IT companies, as well as numerous requests for personal immigration. The demand is such that it has led to some law firms opening offices abroad, in countries like Ukraine or Cyprus. He also emphasizes that “probably around 80% of M&A deals are happening in IT” and mentions activity in the e-commerce sector, with many offline businesses developing their own online platforms. “We also see the increase of requests concerning data protection, IP disputes, legal expertise on sanctions, and, interestingly, more international arbitration cases. Perhaps due to the sanctions or global trends, more companies are requesting the inclusion of arbitration clauses into their contracts,” Arkhipenko concludes.