Category: Belarus

SBH has advised the EBRD and Zubr Capital on their investment in the Mila group of companies, a wholesale distributor of beauty and personal care products that sells these products through its chain of Mila stores. Revera reportedly advised Mila on the deal and Bird & Bird reportedly worked with both sides.

A Zubr Capital press release describes Mila, which has 417 stores in the country, as “one of the largest drogerie-chains in Belarus.” According to Zubr Capital, “the company was founded more than 20 years ago in 1998 and began its development from the wholesale business. The group of companies is a wholesale distributor of world leading brands – Henkel & Schwarzkopf, Colgate & Palmolive, Johnson & Johnson, and Beiersdorf. The company has more than 50 contracts with international brands of perfumes and cosmetics. Since 2010, the company has successfully developed a drogerie chain. During this time, the Mila drogerie chain has grown to 417 stores with a ‘convenience store’ format and has become one of the largest drogerie chain in Belarus. The group of companies employs more than 5,000 employees.”

The investment by Zubr Capital and EBRD is designed to allow the company to increase its number of stores, create flagship stores, and develop product and assortment policy. Zubr Capital Fund I acquired a minority stake in Mila Group.

The SBH team included Partners Alexander Bondar and Anastasiya Malakhova, Senior Associate Evgeniya Starosotnika, Advocate Vitaly Tvardovskiy, Associate Ekaterina Shkarbuta, and Paralegal Anna Soltanowich.

SBH Law Offices has advised Zubr Capital, a private equity fund from Belarus, on its investment in MediaCube, a developer of IT solutions for video creators and musicians.

MediaCube designs and develops IT-solutions to help video-creators and musicians distribute and monetize their content on different platforms while protecting their copyright. Its partners include YouTube and TikTok.

The SBH Law Offices team included Partners Alexander Bondar and Anastasiya Malakhova, Advocate Vitaly Tvardovskiy, and Paralegal Ekaterina Logvinovich.

Acting on behalf of the Incab manufacturer and seller of fiber-optic cables, Arzinger has successfully protected the interests of it and six other producers of optical cables from Russia, Kazakhstan, and Belarus in an antidumping investigation initiated in 2018 by Rosnano’s Optic Fiber Systems JSC in the Eurasian Economic Commission against US and Japanese producers of optical fiber.

According to Arzinger, Rosnano OFS – the only producer of optical fiber in EAEU – claimed that its US and Japanese competitors were dumping their products to artificially lower prices and requested that the Department for Internal Market Defense of the Eurasian Economic Commission investigate the matter and impose antidumping measures. According to the firm, “the investigation was directly aimed at producers of optical fiber, but if succeeded, it would have directly affected the EAEU producers of the optical cable – including the industry leaders Beltelecable, Incab, KCEP and others – by skyrocketing prices for cable because fiber is a crucial component of optical cables.”

The investigation concluded on July 29, 2019, and the Department for Internal Market Defense of the Eurasian Economic Commission found no grounds to impose antidumping measures.

The Arzinger team consisted of Managing Partner Sergey Mashonsky, Partner Klim Stashevsky, and Senior Associate Aleksei Mikhailov. “It’s a huge victory for all the producers of optical cable in Belarus, Russia and Kazakhstan,” commented Mashonsky. “When we took the case it promised no great success along the way and the task was to manage the possible damage by persuading the Department to reduce the 40% antidumping duty that threatened all the producers who use imported fiber. The reason for our professional skepticism was based on statistics – in previous seven years of investigations the Department always ruled for antidumping measures. We are overwhelmed and extremely happy for our producers that this investigation ended successfully with no measures imposed.”

“Belarusian markets are abuzz with two things right now,” explains Arzinger & Partner’s Klim Stashevsky.“The new strategy for attracting FDI and the M10 highway reconstruction project.”

According to Stashevsky, the Belarusian Ministry of the Economy and the Agency for Investments and Privatization has prepared a de facto “road map” for FDI for main sector investments, which provides guidelines for all levels of government. According to Stashevsky, “the legal community was working on and it had a lot of involvement from foreign advisors.” According to him, “the strategy is ready, we’re only waiting for it to be adopted by the Government.”

Stashevsky reports that “the government is launching a big project to reconstruct the M10 highway,” and he says that the Ministry of Transportation and the EBRD are currently conducting a “prequalification process to select a private partner.” This is the first project that will be completed under Belarus’s new Public-Private Partnership Act, he says, and thus it will “serve as a litmus test for projects for the next five years.” 

“As far as the political climate, everything is pretty stable,” continues Stashevsky. “Next year will see Presidential elections, which have motivated the Government to make sure things are running smoothly.“ He says that President Alexander Lukashenko’s announcement of plans to reform the country’s Constitution, aiming to extend the powers of executive and legislative branches, was “met with a moderate response“ and that “everybody sees it as an important change.“

Finally, Stashevsky states that “the IT sector is booming in Belarus“ but that the “forestry and woodworking industry sectors are quite active“ as well. He says that the “woodworking industry sector” is thriving due to it being a “source of energy for the market, which is preparing for the opening of the first nuclear power plant in Belarus, by the end of 2019 or start of 2020.“ He concludes by saying that real estate is seeing “a lot of action too, with companies from Poland, Russia, and China all working in Belarus on a significant number of projects.“

Dispute Resolution specialist Partner Andrei Vashkevich has left Stepanovski, Papkul & Partners to join the Lex Torre firm in Belarus, with Counsel Alexadner Lobaty taking over the firm’s Litigation practice and Senior Attorney Dmitry Kovalchik taking over the Construction & Real Estate practice.

According to a statement on the SPP website, “having joined the team in 2010, Andrei Vashkevich brought to the bureau not only his expertise and experience, but also made [sic] his personal contribution to the overall development of the bureau, the growth and strengthening of the team’s positions. The whole team thanks Andrei for his work and contribution and wishes him success and prosperity!”    

Sorainen has advised Sika on its acquisition of BelINECO, a company specializing in the production of polyurethane foams.

Sika is an international developer and producer of systems and products for the construction sector and the motor vehicle industry that is headquartered in Baar, Switzerland. The local subsidiary, Sika Bel, focuses on the manufacture of concrete admixtures and additives and distributing products from other Sika factories. 

The Belarusian company BelINECO is based near Brest and has been operating since 2008. The company supplies its products to the Kazakh, Russian, and Ukrainian markets.

Sorainen reports that, with the acquisition of a second subsidiary in Belarus, Sika plans to improve its capacity for production of polyurethane foams and gain access to new trade distribution channels.

The Sorainen team consisted of Partner Maksim Salahub, Senior Associate Viktoryia Mikhnevich, and Associate Aliaksei Vashkevich. 

Sorainen said it was unable to disclose further information about the deal. 

Egorov Puginsky Afanasiev & Partners, reportedly working alongside Clifford Chance, has advised Citigroup Global Markets Limited and Raiffeisen Bank International AG as joint lead managers on the issuance and placement of Belarus’s JSC Development Bank’s corporate Eurobonds totaling USD 500 million. Vlasova Mikhel & Partners advised JSC Development Bank on matters of Belarusian law and Baker McKenzie advised the bank on U.S. and English law.

The 144A/Reg S Eurobonds, which are governed by English law are listed on the Global Exchange Market at the Irish Stock Exchange – Euronext Dublin.

Egorov Puginsky Afanasiev & Partners’ Minsk-based team was led by Partner Dennis Turovets and included Senior Associate Alexander Buzo and Associates Anastasia Yarokhovich and Yana Leshchenko.

The Vlasova Mikhel & Partners team included Partner Tatiana Emelianova and Associate Marina Khomich. 

Baker McKenzie’s London team consisted of Partners Roy Pearce and Megan Schellinger, and Associate Maxim Kharpov, and its Moscow team included Partner Dmitry Dembich and Associate Adil Guseynov.

Grata International has announced the termination of its cooperation agreement with Arzinger & Co. in Belarus and the opening of a new office in the country, let by former Arzinger & Partners lawyer Dmitry Viltovsky and colleague Maxim Lashkevich.

A press release issued by the new Grata International BY declares the move to be “a vital step in implementing Grata International’s strategy of providing top quality client service through a unified network applying the highest service delivery standards and best practices.”

Grata’s relationship with Arzinger & Partners began in February 2015 (as reported by CEE Legal Matters on May 13, 2015). 

“Our team in Minsk has set … ambitious plans and as an integrated member of Grata International, they will receive full support from all our offices,” declared Grata International Senior Partner Aidar Sarymsakov. “By joining Grata International Dmitriy Viltovskiy and Maxim Lashkevich will ensure a seamless transition for all ongoing projects in Belarus in which Grata International is involved. As we move to the next level in providing legal services to our clients in Belarus, the previous cooperation with Arzinger & Partners has now come to an end. We thank them for their assistance over the years and wish them well for the future.”

“To achieve a new stage in our development we’ve decided to join efforts with our strategic partner Grata International,” declared Viltovskiy and Lashkevich in a joint statement. “The key features to unity with our partners are shared ethics & values and a desire to provide outstanding service to the highest standards within the international network. The establishment of an integrated office in Belarus will open for us new prospects for realization of our full potential, while our clients will benefit from access to a large team of professional lawyers worldwide.”

SPP Stepanovski, Papakul & Partners has assisted with establishment of H&M in Belarus. The Swedish clothing retailer is registered as H and M Hennes & Maurits Bel.

The company’s first store in Minsk is expected to open in the Fall of 2019 at Galleria Minsk. 

H&M was established in 1947. Currently the Swedish brand has stores in more than 70 countries. 

The SPP Stepanovski, Papakul & Partners team consisted of Partner Alexander Stepanovski, Counsel Maxim Kosachev, Senior Attorney at Law Dmitry Kovalchik, and Attorneys at Law Valentina Komova, Sergey Chistyakov, and Alexey Korol. 

Sorainen is advising the EBRD on Belarusian and Lithuanian aspects related to its loan of USD 11.3 million to the Modus Group for use in the construction of two biogas power plants with total installed capacity of 3MW in Belarus.

The Modus Group is an international group of companies currently operating in Lithuania, Latvia, Estonia, Spain, Poland, Ukraine, and Belarus in the fields of renewable energy, automobiles, and real estate.

In 2018 Sorainen advised the EBRD in connection with its first loan to the Modus Group as reported by CEE Legal Matters on August 22, 2018, which the firm describes as “the first ever EBRD investment in the Belarusian renewable energy sector.”

The cross-border Sorainen team includes Belarus Managing Partner Kiryl Apanasevich and Lithuanian Partner Augustas Klezys, Belarus-based Senior Associate Ann Laevskaya and Associate Artem Semchik, and Lithuania-based Associate Urte Armonaite.