How can a foreign IT company get into the High-Tech Park (HTP) in Belarus?

bnt attorneys in CEE Minsk office shares its experience about launching the office of a foreign tech company in Minsk and entering the HTP.
Engaging Belarus-based software developers is not unheard of among Western technology companies. Many renowned projects such as Viber, MSQRD, World of Tanks, Juno, and Flo bear the mark “made in Belarus”. What is particularly noted is the high quality of Belarusian developers’ work. To hire local developers, a foreign company may consider establishing a subsidiary in Belarus. A subsidiary may take advantage of the tax and legal benefits granted under the High Technology Park (HTP) regime.

We discussed those benefits in details here (link).
In this article we will explain how an IT company can set up a subsidiary in Belarus and become an HTP resident.

In the first place there is a list of business activities that are only allowed in the HTP. The list includes 36 types of hi-tech activities, including:

• design, development, and implementation of information systems and software, including computer games, for any platform;
• data processing with software;
• activities related to cloud computing technologies;
• activities related to a register of transaction blocks (blockchain), crypto-platform operating;
• artificial intelligence;
• development of medical technologies, biotechnologies;
• software publishing;
• trading platforms.
So, it is important to perform an initial analysis to make sure that the planned activity fits within the HTP scope.
Secondly, only a Belarussian legal entity can be a resident of the HTP, so the next step will be to establish a legal entity in Belarus. It should be specifically a legal entity and not a representative office or permanent establishment for tax purposes.
Usually the subsidiary will be in the most widespread legal form in Belarus – a limited liability company (LLC, in Russian: ООО), which has a legal nature comparable to a German GmbH. A foreign company may become a single shareholder of an LLC, unless the foreign company itself has only one shareholder.
Thirdly, to become an HTP resident the subsidiary must submit a business plan to the HTP administration. The business plan must specify one or more types of activities that the Belarusian company intends to carry out in the HTP, specific measures for their implementation, types and volumes of goods (works, services), property rights, justification for their implementation, and planned results of financial and economic activities.
The business plan can be conveniently divided into four main parts: (1) general information about the company, its shareholders and employees; (2) technical description of an activity or product; (3) business case; (4) financial targets.
In the first part a brief description of the company is given: the shareholders, registration details, history, main achievements, busines model, industry specialization, development method, quality management system, stage of product development, employees, etc.
A technical description of the product or planned activity describes the functionality and application of the developed software or the type of hi-tech activity that is planned. Attention is given to performance and effectiveness indicators of software.
It is important to stress new and unique solutions implemented or that are planned to be implemented, technical features which set the software or services apart from the competition.
On that basis, it is suggested further which markets the software belongs to, ways of monetising it, expected sales rates, and channels of distribution.
Financial targets that are placed at the end of the plan nonetheless play a crucial part in the application process, as they are used as the first threshold applied by the HTP administration to filter out unpromising candidates.
Further the company declares certain targets for the following indicators:
• revenue;
• profit;
• profitability of costs;
• growth of labour efficiency;
• work places created;
• average monthly salary.
These indicators are expected to be in line with average performance of all HTP residents and will demonstrate a tendency to growth which, in this case, will justify the benefits and preferences provided under the HTP.
Projects involving cryptocurrencies must conform to a wide scope of additional requirements that must be confirmed by external auditors’ reports.
Fourth, legislation establishes that after the necessary documents are prepared and submitted to the HTP administration, the total period for their consideration cannot exceed 1 month from the date of submission.
bnt attorneys in CEE Minsk office has successfully helped several clients to become a member of the HTP. We have prepared business plans for that purpose which required our team to deeply immerse themselves in the client’s business, study the products, material and related documentation, and conduct interviews with the client’s technical and financial teams.
A business plan that is carefully prepared and with special attention to important aspects of company business together with the ability to correctly represent the business plan in numbers ‒ all enhance the chances of becoming an HTP resident and to further develop the technology business by applying its beneficial regime.



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