Ease of Doing Business: Belarus vs. Ukraine

Belarus has shown significant changes over the past few years in terms of doing business transparency. The current governmental reforms related to the land management, property transfer regulations, etc. allow assuming that the country is moving in the right directions. The specialists today also indicate that Belarus has a beneficial geographical location: being between Europe and Asia, the country’s authorities attempt to meet the main trends and correspond to the foreign businesses requirements. In the current review we not only summarize the main components of the Doing Business Index but also compare it with Ukraine.

Ease of Doing Business Index

The World Bank ranks Belarus 44th in the Ease of Doing Business Index Report 2016. Belarus is amidst the countries that is showing a fast-pace development of modern approaches toward attracting foreign investments and businesses to both cooperate with and register the companies on the territory of Belarus right away. For this, the online services for online registration have been greatly improved so far. Moreover, the expanded geographical coverage for registering a business online has greatly assisted to establishment of brand new companies in there and branches opened by the foreign companies entering the Belarus business sector.

"Belarus introduced a fast-track procedure for property registration"
  • Starting a business in Belarus takes 3 days, and requires only 3 procedures (in Ukraine this number may reach to 20-25 days, in the Czech Republic - 15 days, in Bulgaria – 18 days, Estonia – 3.5 days);
  • Dealing with construction permit, getting electricity supply and registering property might take up to 230 days and 25 different procedures since the country has started local digitization program that aims at unifying land and building registries, thus making the whole process as easy as it only might be. Yet, the aforementioned factors can vanish owing to large number of various types of offices and industrial premises available now and those in the process of construction;
  • Such aspects as protecting minority investors and resolving insolvency are most often not taken into consideration if we discuss, say, IT outsourcing market, since the local market as others in the world conclude contracts and sign regulatory documents upon which all the controversial issues are subject to discussion and legal actions, if necessary.

The main legislative requirements

"Belarus amended provisions relating to wage regulation, labor arbitration, the calculation of overtime pay and grounds for the termination of employment"
  • Fixed-term contracts are not prohibited for permanent tasks
  • Fixed-term contracts are not limited to a specific amount of time
  • Minimum monthly wages – $194
  • Max working days a week – 6 days
  • 20% of an hourly pay over the salary for night shifts, and 100% premium for working weekly rest day
  • Overtime work payment – 100%+ to the salary from an hourly rate
  • the Belarus legislation doesn’t envisage any restrictions on night works as well as there are no restrictions on overtime work
  • 18 working days of the paid annual leave
  • Maximum probationary period – 3 months
  • Dismissals due to redundancy are allowed by the law

Belarus vs. Ukraine: opinions

Belarus is becoming attractive to foreign businesses owing to significant governmental support and numerous steps in the direction of corresponding to the main global business trends. One of Belarus' and Ukraine's main advantages is their geographical location, however, due to the latest political situation, it's quite difficult to understand the exact position of the Belarus authorities. This is one of the reasons why potential investors hesitate whether going to the local market. Yet, the war in Ukraine also doesn't help much, although, many businesses choose cooperation with the country, especially after announcing visa-free commuting with the country.

As to the main factors of arranging full-time business, it's better to find available premises for placing it instead of dealing with construction permits and subsequent works which may take up to 1 year in general. Whereas, after less than a month, it's possible to start already working.

Earlier in the Blog, we have also talked about Doing Business Indices of Estonia, Poland, Hungary, Bulgaria, the Czech Republic, Ukraine.

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