Currently, the government of the Republic of Belarus has achieved that their foreign exchange market regulation, according to many market participants and financial experts, is one of the most loyal and attractive among Western European and EAEU countries. What does the regulation in Belarus look like?
Legal framework in Belarus
On June 4, 2015, the President of the Republic of Belarus signed Decree No. 231 "On the implementation of activities in the OTC market".which is a defining document for the regulation of the foreign exchange market in Belarus. This decree came into force on March 7, 2016.
According to it, the functions of regulator are entrusted to the National Bank of the Republic of Belarus. Control over compliance with legal norms, collection, accounting, systematization and storage of reports, formation of the Guarantee Fund, as well as detection of violations and financial risks is performed by the National -Center, which is created by the Council of Ministers together with the National Bank of the Republic of Belarus.
Requirements for brokers
In order to work in the Republic of Belarus, a broker must obtain a certificate from the NBRB, which confirms that the company is included in the company registrywhich is a kind of analogue of obtaining a license. Only legal entities can apply for inclusion in the register. In addition, the broker applying must meet a number of requirements.
- the minimum capital of the company shall be not less than 200 thousand Belarusian rubles;
- initial contribution to the Guarantee Fund in the amount of 55 thousand dollars + calendar contributions in the amount of 5% of the amount of obligations to clients;
- client funds must be placed in accounts with banks in Belarus;
- clearly defined risk management: the maximum size of the own, not overlapped aggregate position for each individual instrument can not exceed the amount of the equity of the broker.
Terms of trade:
- maximum size leverage is 1:100 for a client, 1:200 for a qualified client, and 1:500 for a professional client;
- not only currencies but also precious metals, securities, etc. can be used as an underlying asset;
- the broker may use only the software provided by the National Center on the basis of the license agreement or approved by it in accordance with the NBRB requirements for the software.
Sales and marketing requirements:
- Advertising for services on the foreign exchange market prohibits the promise of a guaranteed income, there must be a warning of high risks. The use of any information that is not documented is forbidden;
- the company is obliged to have its own office in the country;
- it is obligatory to have representative brokers.
-taxes in Belarus
- according to the requirements of the decree, the broker cannot act as a tax client of the agent and withhold tax from him;
- the same decree establishes a grace period for customers until March 1, 2019 - the personal income tax rate is 0% and after the grace period ends - 13%;
- for company income tax the same grace period applies - the rate is 9%, after the end of the period - 18%.
Loyal market in Belarus
At the moment, financial experts unanimously believe that market regulation in Belarus has a number of undeniable advantages:
- The regulation is carried out logically, its rules are understandable to any broker;
- The very mechanism of regulation is built in such a way that it takes into account not only the interests of the state, but also the interests of companies and their clients. The client receives a sufficient level of protection, the business has normal conditions for development and profit, and the state receives deductions in the form of taxes;
- current rules and requirements are a competent foundation for optimizing regulation in the long run.
According to representatives of brokers working in the Republic of Belarus, due to the fact that the regulation is based on a powerful legal framework, the segment of the Belarusian currency market has positive prospects for further development.