Category: Belarus

Stepanovski, Papakul & Partners has provided legal support for the incorporation in Belarus of four companies from Guangdong in China — three of which have become residents of the Great Stone Industrial Park. 

The three companies now resident in Great Stone are AE International Investment, the Fan Cheng Liquid Metal Lighting Appliances Company, and Fluence International Technology. Their main area of expertise is the production of electronic elements.

According to SP&P, “these corporations are entering the market, so to say, ‘hand-in-hand.’ They would be the first ever companies to be connected not just on the basis of their origin, but also due to the fact that they are controlled by a single managing company, since the fourth company was established by the founders with an aim of accumulating the questions of managing the other three in a unified center.”

As a result of SP&P’s work, there are now 13 companies registered in the Great Stone industrial park.

The SP&P representatives who have taken part in the project are Attorneys at Law Valentina Ogarkova, Maxim Kosachev, Irina Anop, and Yevgeny Bozhko.

In a case referred by Immigration Equality, Weil Gotshal & Manges in the United States has secured asylum for an LGBT man from Belarus who was forced to flee his home after being targeted for numerous assaults on account of his sexual orientation.

Weil reports that the firm’s client, identified only as “a talented musician,” fled Belarus in 2014, after suffering a long series of assaults by both private actors and the police. According to Weil, Litigation Associate Gaspard Curioni — supervised by partner Adam Hemlock — represented the client in his asylum proceeding (including the asylum interview), along with Sasha Shulzhenko, who also served as a translator. The firm reports that its team “put together a voluminous application for asylum, including a personal declaration detailing the abuse our client endured, supporting affidavits, documentary evidence of the attacks, including medical reports, and dozens of reports documenting anti-LGBT violence in Belarus.”

The application process took more than two years. During that time, the Weil team assisted the client and his husband in securing work authorization and advised the couple in relation to events affecting the asylum application. The client and his husband “have built a new life in the United States,” Weil reports, “where they feel safe and can live openly without fear of reprisal.”

Revera has advised Juno — the taxi-hailing service founded by Igor Magazinik and Talmon Marco, the co-founders of Viber — on Belarusian aspects of its acquisition by online taxi service Gett.

The Revera team was led by Associated Partner Helen Mourashko, assisted by Senior Lawyer Uliana Karpekina, the Head of the firm’s IT practice, and Lawyers Tatiana Boychuk and Artem Pyalinok.

Editor’s Note: After this article was published, Sorainen Belarus announced that it advised Gett on the deal. The firm’s team included Partners Maksim Salahub and Kiryl Apanasevich and Senior Associate Kirill Laptev.

“The country is still in recession” says Sergei Makarchuk, Partner at CHSH in Belarus, pointing to an approximately 3% decrease in GDP recorded in Belarus in 2016. Bankruptcy in the corporate sector is on the increase, he reports, with the economic courts’ docket “overflowing” with such cases. The purchasing power in the economy has slowly decreased as a result of lower income and decreased spending power for the middle class.

IT is currently the only prospering sector of the economy, Makarchuk reports, though not sufficient to overcome the greater geopolitical and structural trends. Makarchuk believes that the situation will likely remain the same in Belarus for the next few years, at least – though he hopes for new structural reforms to be introduced opening up the economy and loosening trade regulations to allow for more free and open competition.  

Makarchuk confirms that recent tension between Belarus and Russia has adversely affected the economy, following the “small conflicts … taking place in previous years at the local level” between the two states.  He also points to the lack of free movement of goods to Russia as a result of the restrictions systematically imposed on a number of Belarusian manufacturing companies by the Russian consumer protection authority Rospotrebnadzor, which he says have discouraged foreign investors who would under different circumstances prefer to establish a production site in Belarus for this very purpose.

On the issue of legislative developments, Makarchuk says that the recent protests in Belarus had motivated the government to usher in a new economic agenda, including an amendment to Presidential Decree No. 1, which regulates company registration and liquidation procedures. This amendment, according to Makarchuk, “introduced a limitation period of three years for the state authorities to bring claims on invalidation of a company registration.” The new amendment, set to come into force on September 3, 2017, also simplifies procedures for setting-up and liquidating companies.

Despite the struggling economy, Makarchuk says he has seen no obvious decrease in law firm profits, at least at the top level – but he says many law firms have had to shift their focuses from transactional and corporate work to bankruptcy and litigation in order to maintain a standard level of income for lawyers. Indeed, to maintain the same level of income as before, Makarchuk reports, the competition between law firms has become “very fierce and aggressive,” and firms are investing more heavily than before in business development and marketing.

Revera, in Belarus, has advised 21vek.by onan investment it received on March 31, 2017, from Zubr Capital Fund in a transaction structured under Belarusian and English law.

According to Revera, “under the terms of the transaction, Zubr Capital received the blocking stake, [with] the controlling stake … belonging to 21vek.by. The deal will allow the online-hypermarket to accelerate the growth in the Belarusian market and extend beyond its bounds. The target of 21vek.by for the next five years is to increase [its] revenue three times.” The specific financial terms were not disclosed, though they were reported by Revera at being between EUR 3-7 million, “which is standard for the fund.”

Revera reports that “Zubr Capital Fund invests in Belarusian companies with a high export potential.”

The firm’s team was led by Associate Partner Helen Mourashko, and the project team consisted of Attorney Ekaterina Pedo and Associate Dmitry Gerasimov.

Sorainen Belarus has advised the IFC on the February 14, 2017 sale of some of its shares in Belarusky Narodny Bank at the Belarusian Currency Stock Exchange (BCSE). The sale was completed with the consent of the National Bank of the Republic of Belarus.

Sorainen Belarus advised IFC on its acquisition of 19.9% of BNB’s equity in 2010.

The firm’s team, which included Managing Partner Kiryl Apanasevich and Senior Associate Viktoryia Mikhnevich, advised on the procedure for sale of the shares (including obtaining authorization from the BCSE), reviewed the transaction documents, coordinated the process of making the deal on the BCSE and transfer of the shares, and advised the client on other related issues.

Nektorov, Saveliev & Partners (NSP) has assisted with the establishment of LLC Zoomlion-MAZ, a joint venture between MAZ (Belarus) and Zoomlion (China). The JV, which is located in Belarus, will produce heavy machinery, trucks, and special purpose vehicles manufactured from Belarusian chassis with a Chinese superstructure.

Zoomlion specializes in the design and manufacture of high-tech machinery and specialized construction vehicles for the agricultural, construction, energy, and transportation sectors. Zoomlion has subsidiaries in over 40 countries, and it has more than 30,000 employees.

According to NSP, “the JV will allow Zoomlion to scale up production and enter new markets. MAZ and Zoomlion plan to produce 100 specialized vehicles in 2017, and more than 900 over a 5‑year period. The vehicles will be exported to Russia, Ukraine, Kazakhstan, the EU, the Middle East, Africa and Latin America.”

The NSP team included Partner Marat Davletbaev, Senior Associate Ekaterina Znamenskaya, Ekaterina Pedo, and Svetlana Morozova, among others.

Image Source: en.zoomlion.com

Arzinger has advised a group of the Middle East investors led by Agromilk Holding (UAE) on their acquisition of the state-owned dairy farm located in the Grodno region of Belarus. The multimillion investment project is aimed at the development of the current facilities and the construction of new ones, as well as increasing the livestock.

The Arzinger’s team was led by Partner Dmitry Viltovsky and Deputy Director Klim Stashevsky. Viltovsky, who was responsible for real estate and sale & purchase aspects of the deal, noted that “this deal is a good indicator of attractiveness of the agricultural sector of the Belarusian economy. Our government can offer decent incentives to investors willing to commit to their obligations.”

Stashevsky led the team working on the investment agreement itself. He commented that “the signing of this investment agreement became a remarkable milestone in the development of an investment practice in Belarus. It is good to witness that both foreign investors and the Government are interested in PPP projects.”

The IPM-Consult law firm has advised one of the companies in the TVOE Group on its acquisition of shares of OJSC Baranovichi Sewing Factory belonging to the the Republic of Belarus. The number of shares acquired and the transaction price were not disclosed.

According to IPM-Consult, its assistance took the form of “legal services related to the acquisition of shares on a bidding basis and legal support for the implementation of the terms of competition and contract of sale of shares.”

As a result of the acquisition of shares, the TVOE Group member has modernized the equipment of the Baranovichi Sewing Factory, improved the production process, repaid bank loans, and increased the volume of production.

Revera has assisted American-Belarusian start-up WorkFusion on IP matters and corporate due diligence and other legal matters.

WorkFusion, which automatizes business processes based on machine learning, attracted USD 35 million investment in D-round from a group of companies headed by the Georgian Partners venture fund. Previous investors Mohr Davidow Ventures, iNovia, Nokia Growth Partners (NGP), Greycroft, and RTP Venture, also participated in the round. “Thus,” according to Revera, “the overall volume of the investments attracted by WorkFusion reached USD 71 million.”

WorkFusion, founded by Max Yankelevich and Andrey Volkov seven years ago, has a headquarters in New York and offices in Minsk and Delhi. Most of the company’s staff is located in Minsk.

The Revera team was led by Associated Partner Helen Mourashko, supported by lawyers Tatyana Boychuk and Artem Handriko.