Foreign investors are able to operate on the territory of the Reublic of Belarus through the following forms:

• by creating a representation office
• be establishing an enterprise with foreign investments

     The Procedure of creation.
 
      Basic legal act regulating issues of creation and operation in the Republic of Belarus of representation offices of foreign firms and organisations, their branches (hereinafter the "representation offices") is the Provisions "On the Procedure of Opening and Operation in the Republic of Belarus of Representation Offices of Foreign Firms and Organisations" approved by the Resolution of the Council of Ministers of the Republic of Belarus ?929 of 22 July 1997 as amended (the "Provisions").
 
      Foreign firms and organisations (the "foreign firms") interested to have on the territory of the Republic of Belarus their representation offices may only open them upon permission of the Ministry of Foreign Affairs of the Republic of Belarus (accrediting body).
 
      In accordance with the above Provisions representation offices of foreign firms may be opened for the purposes of conducting activities on behalf of the firms that opened them and which are indicated in the permission for opening of the representation office including:

• effective assistance in implementation of international treaties of the Republic of Belarus on co-operation in the field of trade, economy, finance, science and technics, transport, search of opportunities for their further promotion, improvement of the forms of such co-operation, study and expansion of the volume of economic, commercial and scientific-technical information;
• study of goods markets of the Republic of Belarus;
• study of opportunities for investment activities in the Republic of Belarus, creation of foreign enterprises and joint ventures;
• assistance in development of trade-economic links between the countries;
• representation and defence of the interests of the firm;
• sale of tickets and booking of the places of companies of air-, railway-, car- and marine transport
• conducting other types of activities which are not prohibited by the Belarusian legislation for these representation offices.

      Representation offices are opened for a definite period of time specified in the permission for opening but as a rule for the period not exceeding three years. This period may be prolonged by the Ministry of Foreign Affairs of the Republic of Belarus upon application of the firm (it is necessary to apply for prolongation not later than one month before expiry of the permission) if the purpose of opening of representation office has not been fulfilled in full and such prolongation shall be considered expedient.
 
      Foreign firm interested in opening its representation office in the Republic of Belarus submits to the Ministry of Foreign Affairs of the Republic of Belarus (the "MFA") written application with specification of the purpose for opening representation office and other data relating to creation and operation of the foreign firm in Belarus. To the application shall be attached the following documents:

• Copies of the founding documents of the foreign firm legalized in the established order;
• Copy of the document confirming state registration of the foreign firm by the authorised body of the applicant's country (excerpt from the trade register, certificate on the registration of the firm, etc.) legalized in the established order;
• Power of attorney for the Head of the Representation Office legalized in the established order;
• A letter of reference from the firm's bank, legalized in the established order;
• Power of attorney for the person authorised to fulfil actions for opening of the representation office legalized in the established order;
• Provisions on the Representation office;
• A letter of guarantee from the Lessor in the Republic of Belarus on the provision of the legal address for the office.

      If under the laws of the country of the firm's location a special permission of the state institutions is required than a copy of such permission certified in the established order shall also be attached to the Application.
 
      All indicated documents shall be presented in one of the state languages of the Republic of Belarus - Russian or Belarussian; translation of the documents in a foreign language has to be notarized or certified by the consular department of the Republic of Belarus abroad.
 
      For issue of the permission for opening of the representation office and for prolongation of the accreditation shall be charged state duty in the following amounts:

• 2 000 (two thousand) US dollars for opening of the representation office of foreign firms; 1 000 (one thousand) US dollars - for opening of the representation office of foreign firms of CIS countries;
• 1 000 (one thousand) US dollars for prolongation of the permission for opening of the representation office of foreign firms; 500 (five hundred) US dollars - for prolongation of the permission for opening of the representation office of firms from CIS countries.

      The duty is paid in hard currency through Belbusinessbank by bank transfer or paid by cash by virtue of the invoice issued by the MFA.
 
      Representation office is entitled to commence its operation on the territory of the Republic of Belarus from the date of issue of permission for its opening. Permission for opening of the representation office shall become invalid if the foreign firm did not use its right to open a representation office within 6 months from the date of its issue.
 
      Operation of the representation office shall be terminated in the following cases:

1. in the event the foreign firm has been liquidated;
2. in the event international treaty by virtue of which the representation office was opened, had been terminated, if this is stipulated by this treaty;
3. upon the foreign firm's decision;
4. upon the court's decision if the laws of the Republic of Belarus have been breached;
5. upon the MFA's decision if the representation office violates the established by the legislation procedure of its operation.

     Legal Status.
 
      Representation office is not a juridical person but it may perform on behalf of its company legal acts including entering into transactions, acquire property and personal non-property rights and bear obligations, be a plaintiff and defendant in the courts. As a rule representation office enters into and performs transactions which purport material-technical and informational provision of the representation office operation on the territory of the Republic of Belarus The volume of the representation office powers is not limited by the Belarusian and is established by the foreign firm that opened it.
 
      In accordance with the late amendments to the Provisions, representation offices on the territory of the Republic of Belarus are entitled to engage in any activities including commercial only on behalf of the firm that opened the representation office.
 
      Representation office is entitled to perform its activities in accordance with the legislation of the Republic of Belarus within the granted by the firm powers. For organization of the representation office operation the foreign firm at its discretion may grant the representation office with property and/or monetary funds. Besides, property and monetary funds may be received by the representation office on the territory of the Republic of Belarus. Despite the way of its acquisition all property and monetary funds of the representation office are the property of the firm that opened it.
 
      Representation office is entitled to open in the Belarusian banks currency and rouble accounts. The opening of the accounts takes place after presentation to the bank of a number of the documents as established by the Provisions "On the Procedure of Opening by the Banks of the Accounts to the Clients" ?f 31/12/1998 ? 150.
 
      Foreign firm conducts management of the representation office through appointed Head of the Representation Office which is acting by virtue of the Power of Attorney and is accredited in the established order - by the Ministry of Foreign Affairs.
 
      Taxation of the Representation office is conducted in accordance with taxation legislation of the Republic of Belarus. Taxation of the representation office shall depend whether representation office on the territory of Belarus engages in commercial activities directed at the receipt of income (revenue) or performs only preparatory and auxiliary functions and therefore not receiving any revenue. It should be noted that representation offices are largely subject to the same taxes and charges as Belarusian enterprises; however, representation offices are not subject to beneficial taxation established by Belarusian legislation for the enterprises with foreign investments (foreign enterprises and joint ventures).
 
      In the event that representation office does not conduct any commercial activity, it shall pay only obligatory payments charged from the wage fund as well as real estate tax.
 
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Creation of enterprises with foreign investments

      At present in the Republic of Belarus may be created two types of enterprises with foreign investments: enterprises with 100% foreign capital (foreign enterprises - "FE") and enterprises with both Belarusian and foreign capital (joint ventures - "JV").
 
      Enterprises with foreign investments may be created in the form of joint stock companies, limited liability companies, companies with additional liability, commercial partnerships (general and limited), unitary enterprises, production co-operative societies.
 
      Regulation of enterprises with foreign investments as the form of entrepreneurship is conducted on the basis of the general legislation on companies effective on the territory of the Republic of Belarus. Basic acts of such legislation are the Civil Code of the Republic of Belarus of 7.12.1998, the Law of the Republic of Belarus "On Joint Stock Companies, Limited Liability Company and Companies with Additional Liability" of 9.12.1992 as amended and the Law "On Enterprises" of 14.12.1990 as amended.
 
      Peculiarities of creation and functioning of enterprises with foreign investments due to the presence in their charter capital of foreign investments are established in the law of the Republic of Belarus "On Foreign Investments on the Territory of the Republic of Belarus" of 14.12.1991 as amended.
 
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State registration of enterprises with foreign investments

      Enterprise with foreign investments acquires the rights of a juridical person from the date of state registration. State registration is conducted by the MFA within one month from the date of submitting all necessary documents for state registration (the list is attached) and filling in by each founder of the form of the established contents with the data necessary for state registration. In case of necessity the MFA may prolong the period for state registration up till two months with notification on this of an owner of the property (founders). Before submitting the documents to the MFA founders of the foreign enterprise or joint venture shall obtain the approval of the local executive body for the company's location(in case of Minsk - Minsk City Executive Committee) which is issued within 10 days from the moment of submitting the application of the founders, founding documents of the created enterprise and document confirming the location of the FE or JV.
 
      State registration of an enterprise with foreign investments shall not be refused for the reasons of expediency.
 
      Peculiarities of creation and functioning of enterprises with foreign investments due to the presence in their charter capital of foreign investments are established in the law of the Republic of Belarus "On Foreign Investments on the Territory of the Republic of Belarus" of 14.12.1991 as amended.
 
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Contributions to the charter fund of enterprise with foreign investments

      Under the law of the Republic of Belarus "On Investment Activities in the Republic of Belarus" of 29.05.1991 as well as the Law "On Foreign Investments" the minimal amount of the foreign investments in FE or JV is established in the amount equivalent to 20 000 US dollars. The whole of the charter capital shall be declared in US dollars.
 
      Declared in the founding documents charter fund of the enterprise with foreign investments shall be formed for not less than 50% within the first year from the date of state registration of the enterprise by means of contributing by each of the participant of not less than 50% of its share and in full --within two years from the date of registration.
 
      Contributions to the charter capital of enterprises with foreign investments (FE or JV) may be conducted in monetary and/or inkind form.
 
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Transfer of the income

      The Law "On Foreign Investments" establishes the following guarantees to foreign investors upon payment of all necessary taxes and charges in regard to the revenue which belongs to them, received from the use of their investments:

1. use of revenue for the purposes of investment and re-investment as well as for the purchase of the goods on the territory of the Republic of Belarus;
2. use of revenue for acquisition of hard currency on the internal market of the Republic of Belarus;
3. unimpeded transfer of the revenue in hard currency into any other country