On 1 January 2014 a new Regulation on the Procedure for Establishing and Operating a Foreign Representative Office in the Republic of Belarus (Regulation) approved by Resolution of the Council of Ministers No. 1189 of 31 December 2013 entered into force, though it was only published on 14 January 2014.
The aims of establishing representative offices for foreign commercial companies are changed. As a rule, a representative office of a foreign commercial company can only be established for auxiliary or preparatory activities. However, unlike previous laws, the Regulation directly prohibits operations by foreign companies in Belarus without establishing a representative office.
A permit for establishing a foreign representative office is now issued for a fixed term of three years (previously it was possible to choose a term ranging from one to three years). The number of foreign employees of a representative office is limited to five.
Ending activity by a representative office requires a Ministry of Foreign Affairs decision. The Ministry of Foreign Affairs may so decide in two cases: if the representative office is inactive for half a year or more, or if the head of the representative office fails to report on office activity within a set term and fails to react to written notification by the Ministry of Foreign Affairs.
These novelties were received dubiously by the business community. A range of questions is still pending. For example, are currently operating representative offices obliged to bring their activity in line with the new Regulation? Does exclusion of provisions allowing business activity via a representative office prohibit such activity? We can only wait for additional clarification by the state authorities and follow the practice of applying the new Regulation.