Chapter

BELARUS

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2004
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(Position as of April 30, 2004)
Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: November 5, 2001.
Exchange Arrangement
CurrencyThe currency of Belarus is the Belarusian rubel.
Exchange rate structureUnitary.
Classification
Crawling bandThe rubel is de jure pegged to the Russian ruble under a system in which the National Bank of Belarus (NBB) sets the official exchange rate against the Russian ruble based on the results of trading sessions on the Belarus Currency and Stock Exchange (BCSE). This official rate is adjusted quarterly within an announced narrow path. To contain inflationary expectations, the NBB takes into account the exchange rate of the rubel against the dollar when making these adjustments.
Exchange taxNo.
Exchange subsidyn.a.
Forward exchange marketThe forward market is regulated by the same provisions as the spot market.
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements of transactions between residents and nonresidents are effected in freely convertible currencies. Settlements in other currencies and Belarusian rubels are effected if provided for by intergovernmental agreements or arrangements between the central banks of both parties to the settlements. Settlements in Belarusian rubels between residents and nonresidents of the countries with which such arrangements have been concluded may be effected through nonresident accounts in domestic banks through correspondent accounts in Belarusian rubels of nonresident banks with authorized banks in Belarus. Settlements with nonresidents in rubels are also allowed regardless of the existence of an intergovernmental agreement, provided that settlements are effected through a nonresident rubel account at a bank in Belarus.
In accordance with the agreements between the NBB and the central banks of most CIS countries (except Azerbaijan and Uzbekistan), settlements are effected in the national currencies of the parties involved in the settlements, and in freely convertible currencies.
Controls on the use of domestic currency
For current transactions and paymentsYes.
For capital transactions
Transactions in capital and money market instrumentsYes.
Transactions in derivatives and other instrumentsYes.
Credit operationsYes.
Use of foreign exchange among residentsSettlements between residents in foreign currency are prohibited, except in cases established by law or the NBB.
Payments arrangements
Bilateral payments arrangements
OperativeYes.
Regional arrangementsBelarus has arrangements with Moscow and various other regions in Russia.
Clearing agreementsAn agreement with Uzbekistan provides for the exchange of cotton for strategic goods from Belarus on a balanced basis. There are also agreements with Moldova and Ukraine.
Administration of controlThe exchange regulation authorities are the Council of Ministers and the NBB, while the exchange control authorities are the Council of Ministers, the NBB, the State Control Committee, and the State Customs Committee. The exchange control agents are banks, customs offices, bodies of the state administration, and state organizations subordinate to the Government of Belarus and oblast (local) governments.
International security restrictionsNo.
Payments arrears
OfficialYes.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents (other than banks) are required to have a license issued by the MOF to engage in transactions in precious metals and stones. When effecting banking operations with precious metals and stones, banks are required to have a license issued by the NBB. Banks must obtain a license from the MOF to engage in nonbanking operations in precious metals and stones.
Controls on external tradeLicenses for residents to export precious metals and stones are issued by the Ministry of Foreign Affairs.
Controls on exports and imports of banknotes
On exports
Domestic currencyResidents and nonresidents may export up to the equivalent of 100 times the Belarusian yearly minimum wage.
Foreign currencyEffective March 14, 2003, resident and nonresident natural persons may freely export the equivalent of $3,000 (previously, $1,500)—amounts greater than this limit and up to the equivalent of $10,000 require documentary evidence certifying the origin of the funds. Traveler’s checks in foreign currencies may be exported without restriction, but they must be declared. Exports of foreign currencies to states participating in the customs union are unlimited.
On imports
Domestic currencyThe import of up to the equivalent of 100 times the Belarusian yearly minimum wage is allowed.
Foreign currencyThere are no limits on imports of foreign currency, but they must be declared upon arrival.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyWithout declaring the sources of their foreign exchange, residents may open foreign currency accounts at commercial banks authorized to deal in foreign exchange.
Held abroadYes.
Approval requiredNBB approval is required. No approval is required for accounts of individuals residing abroad.
Accounts in domestic currency held abroadResidents require NBB approval to open domestic currency accounts abroad.
Accounts in domestic currency convertible into foreign currencyResident juridical persons may purchase foreign currency: (1) to pay for imports of goods, labor, and services; (2) to pay for business travel and training expenses abroad; (3) to repay credits and loans granted by authorized banks in Belarus or by nonresidents and pay interest thereon; and (4) to make a number of other transactions that have been specified by the NBB.
Nonresident Accounts
Foreign exchange accounts permittedNonresident juridical persons may maintain foreign exchange accounts with authorized banks in Belarus. The source of the funds may be receipts from abroad; proceeds from the sale of goods and services in the territory of Belarus, including sales to residents; debt-service payments; interest earned on balances on the accounts; funds from other foreign exchange accounts of nonresidents in Belarus; and earnings from investments from the performance of other operations with residents and nonresidents. These accounts may be debited for purchases of goods and services and for investments, as well as for payments to residents and nonresidents. Funds from these accounts may be freely repatriated or exchanged for Belarusian rubels at the market exchange rate through authorized banks.
Approval requiredApproval from the central bank concerned is required to open accounts for nonresidents if this requirement is contained in the arrangement governing the settlements.
Domestic currency accountsNonresident juridical persons may open I (investment), T (current), and S (investment in government securities) accounts at authorized commercial banks. I accounts may be credited with Belarusian rubel funds arising from foreign exchange sales, dividends, resources from the liquidation of enterprises, and compensation in the event of the nationalization of enterprises. The uses of resources from I accounts include purchases of foreign currency, shares of enterprises, and privatization checks.
T accounts are used for current operations. Proceeds from the sale of foreign currencies and of goods and services as well as resources from the placement of money in deposits and other debt obligations of banks are transferred into them. Resources from T accounts may be used to purchase goods and services and bonds, and to pay for current expenditures. Nonresidents may purchase foreign currency with Belarusian rubels from T accounts and correspondent accounts of nonresident banks opened at authorized banks in Belarus. Funds in S accounts are used for investment in securities issued by the Belarusian government and the NBB. Proceeds from the sale of freely convertible currencies and/or Russian rubles, as well as proceeds from the redemption or sale of government and NBB securities by nonresidents, are deposited in S accounts if the original purchases were made with payments from S accounts.
Convertible into foreign currencyBalances on T, I, and S accounts may be converted into foreign currency. In these operations, balances on S accounts may be converted into foreign currency, provided that the nonresident was a holder of securities of the government or the NBB for a time period established by the NBB.
Approval requiredOpening of accounts for nonresidents is subject to approval of the central banks of the country of the nonresidents concerned, if this regulation is contained in the arrangements governing settlements between Belarus and the country concerned.
Blocked accountsn.a.
Imports and Import Payments
Foreign exchange budgetn.a.
Financing requirements for imports
Advance payment requirementsEffective January 1, 2004, a foreign bank guarantee is required for advance payments for goods or services exceeding the equivalent of $500,000 (previously, $100,000). For payments for imported services more than 90 days in advance of the performance of the services and for imported goods more than 60 days in advance of the receipt of the goods, permission from the Ministry of Trade (MOT) is required; for advance payment of more than 180 days, NBB approval is required.
Documentation requirements for release of foreign exchange for imports
Domiciliation requirementsYes.
Import licenses and other nontariff measuresLicenses are required for imports of the following goods: raw cane; white sugar; starch syrup; yeast and other dead unicellular microorganisms; alcohol products; carpets and floor coverings; disinfectants; malt beer; edible oils; pesticides; soap; and tires.
Negative listThere are prohibitions on imports of production and consumption wastes that cannot be processed or used in Belarus and on printed matter, audiovisual materials, and other information media containing information that may harm the political or economic interests or security of Belarus, or the health and morals of Belarusian citizens.
Licenses with quotasQuantitative restrictions are applied to raw cane and sugar, alcohol, tobacco products, seafood, and deepwater fish.
Import taxes and/or tariffsBelarus has abolished customs controls and customs processing of goods moving between Belarus and Russia. Steps are being taken to establish a uniform trade policy with third countries, in particular, Vietnam and Serbia and Montenegro. The tariff structure consists of higher rates that apply to goods such as weapons, ammunition, precious metal products, carpets, motor vehicles, alcohol, and certain other goods. Seasonal tariffs apply to raw cane and sugar. Regular (base) import duty rates apply to countries with MFN status. Duties at twice the MFN rates are imposed on goods imported from countries that do not have MFN status. VAT is collected on imports from all countries except Russia. Excise taxes are collected on imports from all countries, with the exception of goods from Russia that are marked with excise tax stamps. About 60% of tariff nomenclature has been unified among Belarus, Kazakhstan, and Russia, and to a lesser extent, Belarus, the Kyrgyz Republic, and Tajikistan.
Precious metal ingots imported by banks for purposes of banking operations and by juridical persons for purposes of selling to banks are exempt from customs duties and VAT; also exempt are sales by juridical persons to banks, transactions between banks, and sales by banks to natural persons.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsProceeds from exports of goods and services must be repatriated within 90 days, and proceeds from other exports of goods and services produced by residents under commission contracts must be repatriated within 180 days. Special MOT approval is required for longer time periods, and special NBB approval is required for periods exceeding 180 days.
Surrender requirementsThe surrender requirement is 30%.
Financing requirementsNo.
Documentation requirementsA transaction certificate or a statistical declaration is required.
Export licensesLicenses are required for exports of the following goods: fabrics made of wool yarn; cotton thread, yarn, and fabric; thread from chemical fibers; yarn and fabric made of artificial and synthetic fibers and blended fibers; cable and rope products; terry cloth towels and similar terry cloth fabrics; interwoven interlock fabrics; socks and hosiery articles; knitted clothing accessories; textile clothing and accessories; blankets, throws, and bed, table, bath, and kitchen linens; dishcloths; curtains, window shades, and bedspreads; sacks; paper bags; floor cleaning fabrics; and sets consisting of fabrics and yarn (only for goods to be exported to the EU and Turkey). In addition, exports of the following goods are effected on the basis of MOT-issued licenses: mushrooms, cranberries and blueberries, grains, flax seeds and rape seeds, alcohol products, ethyl alcohol, raw amber, burned pyrites, unprocessed lumber, precious metals and precious stones in any form or state, crude oil and oil products, and rawhides and animal skins. Contracts for exports of petroleum refining products by non-producers of these products must be registered with the MOT. Minimum export prices apply to unrolled pig iron and steel, fiberboard, chipboard, lumber, mushrooms, natural resin, berries, flax fiber, leather, and mineral fertilizer.
With quotasMineral fertilizers and ferrous and nonferrous metal waste are subject to export quotas and licensing requirements, as are exports of textiles to the EU and Turkey and exports of fiberglass to the United States.
Export taxesVAT and excise taxes are collected on goods exported to Russia.
Other export taxesUnder the arrangement of the common customs region with Russia, export customs duties are collected on a list of goods with a low degree of processing that are exported outside the customs union. Most duties are on an ad valorem basis and range from 5% to 30%. Specific and combined duties are also levied.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersYes.
Payments for travel
Quantitative limitsThere are no restrictions on the purchase of foreign exchange for bona fide expenses related to business travel.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsAll proceeds from services must be repatriated within 90 days, and proceeds from exports of services performed by residents under commission contracts must be repatriated within 180 days. Special MOT approval is required to extend repatriation periods, and special permission from the NBB is required for periods exceeding 180 days.
Surrender requirementsThe surrender requirement is 30%.
Restrictions on use of fundsn.a.
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsThe government and the NBB establish quotas and procedures for clearing the securities of foreign issuers for circulation in Belarus and quotas and procedures for clearing securities of issuers under the jurisdiction of Belarus for circulation outside Belarus.
The domestic placement of stocks and bonds of foreign issuers and foreign placement of stocks and bonds of domestic issuers are permitted, subject to regulations.
On capital market securities
Shares or other securities of a participating naturePurchases or sales locally by nonresidents require registration with the Securities Committee (SC) under the Council of Ministries (COM) for shares to be exported.
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsA permit from the NBB and registration with the BCSE and, when necessary, with the SC are required.
Sale or issue abroad by residentsYes.
Bonds or other debt securitiesRegistration of securities is required. The NBB regulates the issue of certificates of deposit (CDs) and saving certificates by banks. These may be issued both in domestic currency and in foreign exchange. Banks are not allowed to export bank certificates.
Purchase locally by nonresidentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue abroad by residentsA permit is not required for sale.
On money market instruments
Purchase locally by nonresidentsAn NBB permit is not required. Transfers of CDs to nonresidents are prohibited.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsAn NBB permit is required.
Sale or issue abroad by residentsYes.
On collective investment securitiesControls on the purchase or sale locally by nonresidents are administered by the SC under the COM (Resolution of the State Securities Committee No. 43/P).
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsAn NBB permit is required.
Controls on derivatives and other instrumentsControls on purchase or sale locally by nonresidents are administered by the SC under the COM (Resolution of the State Securities Committee No. 43/P).
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsAn NBB permit is required.
Controls on credit operations
Commercial credits
By residents to nonresidentsA permit is required for deferral of receipt of export proceeds. For deferrals of 90 to 180 days, the permit is issued by the MOT; for deferrals of more than 180 days, the permit is issued by the NBB. The same procedures apply to advance payments.
Financial credits
By residents to nonresidentsAn NBB permit is required if the credit is for longer than 180 days.
To residents from nonresidentsRegistration with the NBB is required for credits longer than 180 days.
Controls on direct investment
Outward direct investmentA permit from the NBB is required.
Inward direct investmentForeign investments must be registered with the Minsk City Executive Committee; financial institutions must also register them at the NBB. In the case of insurance institutions, foreign investments must be registered also with the State Insurance Oversight Committee. Certain activities require special approval (license). When establishing an enterprise with foreign investments, the proportion of a foreign investor’s share is not restricted, except for insurance organizations, which may not exceed 49%.
Controls on liquidation of direct investmentForeign investors are guaranteed full repatriation of their initial investment capital and profits earned in Belarus.
Controls on real estate transactions
Purchase abroad by residentsAn NBB permit is required.
Controls on personal capital transactions
Loans
By residents to nonresidentsAn NBB permit is required for loans with maturities of more than 180 days.
Provisions specific to commercial banks and other credit institutionsForeign currency purchases and sales may be performed by juridical persons, resident and nonresident individuals, and authorized banks on both the foreign exchange market and the over-the-counter exchange market.
Borrowing abroadThese operations may be performed on the basis of banking licenses.
Maintenance of accounts abroadThese operations may be performed on the basis of banking licenses.
Lending to nonresidents (financial or commercial credits)Credits may be extended to nonresidents for investment activity.
Lending locally in foreign exchangeThese transactions are permitted for purposes of settlements with nonresidents and of settlements with residents who have the appropriate permits; purchases and sales of foreign currency and conversion to another foreign currency for purposes of settlements specified under the lending agreement are permitted.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsEffective April 1, 2004, domestic currency deposits held by natural persons are subject to a reserve requirement of 8% (previously, 10%). All other deposits are subject to a reserve requirement of 10% (NBB Resolution No. 4). On January 1, 2003, all deposits were subject to a unified reserve requirement of 10% (NBB Resolution No. 220).
Differential treatment of deposit accounts held by nonresidents
Reserve requirementsEffective April 1, 2004, domestic currency deposits held by natural persons are subject to a reserve requirement of 8%. All other deposits are subject to a reserve requirement of 10% (NBB Resolution No. 4). On January 1, 2003, all reserve requirements were unified at 10%.
Investment regulations
Abroad by banksCoordination with the NBB is required.
In banks by nonresidentsCoordination with the NBB is required.
Open foreign exchange position limitsOpen foreign exchange position limits are established for each type of foreign currency separately and also for the aggregate position. Limits are computed as a whole by type of foreign currency regardless of whether assets (liabilities) belong to a resident or nonresident.
The following limits based on a bank’s equity capital have been established on open foreign exchange positions: (1) an overall open foreign exchange position of 20%; (2) an open foreign exchange position of 10% for each type of foreign currency on balance-sheet accounts and off-balance sheet accounts; and (3) an open foreign exchange position of 10% on forward transactions for each type of foreign currency.
Provisions specific to institutional investors
Limits (max.) on securities issued by nonresidentsControls are administered by the SC under the COM (Resolution of the State Securities Committee No. 43/P).
Other controls imposed by securities lawsn.a.
Changes During 2003
Arrangements for payments and receiptsMarch 14. The limit on the amount of foreign currency resident and nonresident natural persons are allowed to export without documentary proof of its origin was increased to the equivalent of $3,000, from $1,500.
Capital transactions
Provisions specific to commercial banks and other credit institutionsJanuary 1. All reserve requirements were unified at 10%, regardless of the type of deposit (NBB Resolution No. 220).
Changes During 2004
Imports and import paymentsJanuary 1. The limit at which a foreign bank guarantee is required for advance payments was increased to the equivalent of $500,000 a transaction, from $100,000.
Capital transactions
Provisions specific to commercial banks and other credit institutionsApril 1. The reserve requirements for domestic currency deposits of resident and nonresident natural persons were reduced to 8% from 10%, while the requirement for all other deposits remained at 10% (NBB Resolution No. 4).

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