Compensatory measures for FEZ residents introduced in Belarus

    Belarus President Aleksandr Lukashenko has signed a decree on introducing compensatory measures for the residents of free economic zones (FEZs) in connection with the abolition of the customs privileges on 1 January 2017.

    These measures will compensate for part of the additional losses, preserve the competitiveness of products on the external and internal markets.

    In particular, the decree envisages that the free economic zones will be operational till 31 December 2049. This condition is an important factor for the preservation of competitiveness and investment attractiveness of free economic zones in the republic.

    In accordance with the document, the borders of the free economic zones Brest, Grodnoinvest and Vitebsk will be expanded. It can be explained by the new conditions at the international level. For example, the draft Customs Code of the Eurasian Economic Union provides for a number of privileges for port and logistic free economic zones, additional preferences for the residents of zones provided the borders of these zones coincide with the parts of the customs border of the EEU or include the territories of international airports.

    The borders of these zones will be changed in the following way. The free economic zone Vitebsk will include a land plot with the total area of 231 hectares for the investment project to build a multi-purpose industrial and logistic complex in the village of Bolbasovo, Orsha District.

    The economic zone Brest will include eight land plots with the total area of 3,328.7 hectares, including a land plot in Brest which is adjacent to the border of the European Union and includes the automobile border checkpoints Kozlovichi and Varshavsky Most, the railway border checkpoint Brest, five land plots in Kobrin and Kobrin District with the total area of 393.3 hectares, and land plots of the Baranovichi-based plant of automatic lines and OAO Kuzlitmash in Pinsk.

    The free economic zone Grodnoinvest will include a land plot with the total area of 455 hectares for the construction of production and maintenance enterprises, transport and logistic centers.

    The decree also envisages the reduction of the volume of investments from €1 million to €500,000. This measure is conditioned by the tough competition for investments, including within the framework of the Eurasian Economic Union, the reluctance of investors to be registered as the resident companies of free economic zones if it possible to use the preferential regimes envisaged in Ordinance No. 6 of 7 May 2012 and Ordinance No, 10 of 6 August 2009 of the Belarusian President regardless of the volume of investments.