Investment agreement.

On August 6, 2009 President of the Republic of Belarus signed Decree № 10 "On creation of additional conditions for investment activity in Belarus". The essence of the document is to provide investors with opportunities to enter into investment treaties in simplified, compared with the existing, order, and receive benefits under the Decree, after the conclusion of such agreements. The document comes into force three months after the official publication (the Decree was published on 08.08.2009).

Currently, in accordance with the Investment Code, investors’ offers relating the content of investment agreement are examined by the Government of the Republic of Belarus or governmental authority. Investment agreements are signed by the decision of the Government of the Republic of Belarus with the consent of the President of Belarus. Necessary condition for investors for the conclusion of the investment agreement is to provide a business plan and to pass state complex examination of the investment project, held by Ministry of Economy.

The Decree simplifies the process giving a right to make decisions to conclude investment agreements to local executive authorities and Government. Based on the investment agreement, concluded according to the Decree, an investor will be able to enjoy the benefits provided by the Decree. The President’s consent will be needed only if an investment agreement provides an investor with additional benefits and preferences that are not provided by legislation.

Another innovation is that for conclusion of investment agreements, based on decision of Government (without consent of the President) or local executive authorities, business-plan of investment project is not required and it is not subject to state complex examination.

At the same time it should be noted that the Decree does not contain a definition of "investment project" and the criteria based on which the relevant authority will make a decision on the conclusion of the investment agreement. Currently, the term "investment project" is defined in Investment Code as documents, describing the idea of investments and its practical implementation to achieve the desired result within a certain period of time. Obviously such a document under the Investment Code is a business plan. However, as mentioned above, the Decree gives a right to local authorities and Government to conclude investment agreements without business plans. Thus, to conclude the investment agreement, it, theoretically, may be enough for investor just to offer an idea.

It remains an open question relating the minimum amount of investments provided by investment project that gives to investor a possibility to conclude an investment agreement. In accordance with the present legislation the contribution of national and (or) foreign investors in the investment project should be equivalent to at least 5 mln. USD. Based on the spirit of the decree, aimed at attracting investments, obviously, primarily in the construction industry, it would be logical and appropriate to provide a gradation of levels of investment.

In accordance with the Decree investors and (or) organizations created by investors or with their participation, have the following rights:

- on construction of sites, provided by the investment project, concurrently with the development, examination and approval the necessary construction design estimates documentation for each of the stages of construction with the simultaneous design of subsequent phases of the construction;

- to obtain lease rights on a land plots required for the construction of facilities provided by investment projects without auctions, with registration of documents required for the allotment of land plots concurrently with the performance of construction works. The land rent is determined on the date of the lease agreement and can not be increased during the whole term of the investment project;

they are also exempt from:

- payments for the right to sign lease land contract;

- compensation for loss of agricultural and (or) forest land required under the investment project;

- payment of import customs duties and value added tax (except for payment of VAT for goods imported into the territory of the Republic of Belarus from the territory of Russia) on equipment and spare parts for the objects, associated with the implementation of the investment project, imported into the customs territory of Belarus;

- state fees for issuance of work permits and residence permits for foreign citizens involved in the investment project.

The decree also recommended local authorities to exempt investors from payment of fees to local budgets.