Debt Recovery for Foreign Creditors
Non-resident companies sometimes face non-fulfillment by Belarusian business partners of obligations under contracts. This leads to financial losses and disagreements. When it is not possible to settle disagreements, debts from Belarusian partners can be collected forcibly.
When a non-resident company can collect a debt in Belarus
When a non-resident company enters into a contract with a Belarusian company or an individual entrepreneur, the contract usually prescribes the procedure for resolving disputes under the contract. When the contract says that the parties use Belarusian legislation to resolve disputes, it is necessary to use the pre-trial dispute resolution procedure. In addition, the place where the contract is violated, not executed, should be Belarus. By default, this is a claim procedure: a debtor who has not fulfilled his obligations needs to send a claim with a non-resident’s requirements. Only after the debtor has not responded to the claim within a month after receiving it and has not fulfilled the obligation, the non-resident can apply to the court.
As a rule, they apply to the economic court at the location of the debtor. The location can be seen in the agreement on which there were disagreements.
How a non-resident can apply to the Belarusian Economic Court
It is most convenient to organize interaction with the Belarusian court through a representative office in Belarus. The representative will need, in particular, a power of attorney from a non-resident company. The power of attorney will need to be translated and notarized.
Disputed Claims
When the resident debtor does not dispute the claim, but does not fulfill it, and the non-resident has documents that confirm his claims, you can apply to the Belarusian economic Court in the order of writ proceedings. In this case, the court considers the case within 20 days without summoning the parties and issues an enforcement document: a ruling on a court order. If the debtor sends to the court a response to the claimant’s application with disagreement with the requirements, the court will refuse to issue a ruling on the court order to the non-resident. Disputes under contracts of assignment of claims and transfer of debt are not considered in the order of writ proceedings.
When a resident debtor objects to the claims of a non-resident, you can apply to the court with a statement of claim. In this case, the court summons the parties, examines the evidence and the trial can last up to seven months or even up to one year.
When Can a Foreign Company Recover Debt in Belarus?
When a foreign company enters into a contract with a Belarusian business or individual entrepreneur, the contract typically sets out the procedure for dispute resolution. If the contract specifies that Belarusian law governs the relationship, a pre-trial dispute resolution procedure becomes mandatory.
Additionally, the place where the contract was breached or remained unfulfilled must be Belarus. By default, this means following a claims procedure: the debtor, who failed to fulfill their obligations, must be formally served a demand (claim) from the foreign creditor. Only if the debtor does not respond or fails to satisfy the claim within one month of receiving it, can the foreign entity escalate the matter to court.
Court Jurisdiction
Such cases are generally filed in the economic court at the debtor’s location. This location is usually stated in the contract that gave rise to the dispute.
How a Foreign Company Can Recover Debt in Belarusian Economic Courts
Foreign companies seeking to recover debts from Belarusian partners typically do so through local legal representation. This requires issuing a notarized, officially translated power of attorney.
If the Belarusian debtor does not contest the debt and the creditor has clear supporting documents, the case can often proceed under simplified order (summary) proceedings. The economic court reviews the matter within 20 days without calling the parties and, if satisfied, issues a judicial order for enforcement.
However, if the debtor files objections or if the dispute involves assigned claims or transferred debts, this expedited process isn’t available. The foreign creditor must then file a full lawsuit. This involves formal hearings, examination of evidence, and can take several months to over a year to conclude.
Local legal experts help ensure documents comply with Belarusian requirements and guide the case through the proper procedure for the best chance of successful recovery.
Suspension of Enforcement
Following Belarus Presidential Decree No. 93 of March 14, 2022, the Council of Ministers identified a list of “unfriendly states,” including the EU, USA, UK, Canada, Australia, and others. While initial measures under Decree No. 93 were broad, a new Decree No. 137, effective from April 9, 2022, directly impacts debt recovery: it suspends compulsory enforcement of court orders in favor of residents from these states.
This means ongoing enforcement proceedings are frozen—no payments are made, though creditors retain their place in the queue. New enforcement requests may still be filed and formally opened, but will be immediately suspended under the decree. Importantly, the decree doesn’t restrict Belarusian debtors from voluntarily fulfilling obligations to these creditors.
Decree No. 137 narrowly defines affected “residents” as foreign legal entities, branches, and certain international organizations—excluding private individuals and subsidiaries in Belarus. However, future clarifications or tighter controls are possible. We closely monitor these developments and will keep clients informed of any practical impacts.
Who Qualifies as a “Resident of an Unfriendly State” Under Belarus Decree No. 137?
Decree No. 137 adopts a narrower definition than the earlier Decree No. 93. While Decree No. 93 broadly targeted “persons from foreign states,” including businesses primarily operating in or controlled by entities from “unfriendly states,” Decree No. 137 applies only to specific residents of these countries that have taken unfriendly actions against Belarusian individuals or entities.
Covered Entities
According to Belarusian currency regulation law, this includes:
- Foreign legal entities
- Branches and representative offices of foreign companies, whether located in Belarus or abroad
- Individual entrepreneurs registered in foreign states
- Foreign non-corporate organizations and their branches or representative offices
- Diplomatic missions, consulates, and other official representations of foreign states
- International organizations and their subdivisions
Notably, this list does not cover private citizens of these countries, nor does it automatically extend to Belarusian subsidiaries owned by companies from “unfriendly states.” Based on a strict reading of the decrees, enforcement of court orders in favor of such individuals or subsidiaries should not be suspended. Still, further clarifications or new regulatory acts could change this interpretation. We continue to monitor developments closely and will keep clients updated on any changes impacting enforcement in Belarus.
Our Services
When Can a Foreign Company File a Debt Recovery Case in Belarusian Economic Court?
International treaty jurisdiction
Belarusian economic courts hear disputes when an international treaty (like CIS agreements) grants jurisdiction—covering cases tied to debtor location, business activities, or contract performance in Belarus.
Close connection to Belarus
Courts assess a strong link to Belarus based on the debtor’s residence, property located in Belarus, or contractual obligations requiring fulfillment within Belarusian territory to establish jurisdiction.
Exclusive court competence
Certain disputes—like those over Belarusian state property, local real estate, bankruptcy, or removing asset seizures—fall under the exclusive jurisdiction of Belarusian economic courts and cannot be shifted elsewhere.
Written agreement on jurisdiction
Parties can sign contracts or separate agreements directing disputes to Belarusian economic courts or arbitration. However, they cannot override laws assigning exclusive jurisdiction to specific Belarusian courts.
General Procedure for a Non-Resident Filing a Debt Claim in Belarusian Court
Sending a Pre-Court Demand
Belarus requires a mandatory pre-trial claim process in commercial disputes. The written demand must include creditor details, grounds and evidence, legal references, calculation of the debt, bank details, and supporting documents. It’s sent by traceable mail or delivered in person. The creditor must wait one month (or any shorter period set by contract) before filing in court.
Drafting the Claim or Order Application
Claims must clearly state the court’s name, parties’ details, claim value, facts, evidence, calculation, legal basis, compliance with pre-trial steps, and list of attachments. An application for summary proceedings follows a similar structure. Properly prepared documents ensure acceptance and avoid delays from court rejections over procedural defects.
Paying State Fees
State fees depend on claim size and the claimant’s country. Belarus calculates them by tiered percentages or flat rates, payable in Belarusian rubles or convertible currencies. CIS residents generally pay in Russian rubles. Payment orders must bear a bank’s execution stamp, with date, signature, and original bank seal to be valid.
Filing Documents with the Economic Court
The court package includes the original claim, proof of fee payment, copy of the pre-trial demand, supporting documents, proof of the creditor’s legal status, and representative’s authority. Some documents may require apostille or consular legalization, unless exempt under treaties (as with CIS states). Foreign documents also need certified translations into Belarusian or Russian.
Initiating Proceedings and Obtaining a Decision
The court schedules a preparatory session, then a full hearing. Non-residents may participate personally or via local counsel. They have rights to review case files, present evidence, question the debtor, file motions, and appeal rulings. The court issues either a judgment (in standard claims) or a payment order (in summary proceedings).
Enforcing the Court Decision
If the Belarusian debtor fails to comply voluntarily, the creditor can file with enforcement authorities. This application includes parties’ details, debtor’s assets, grounds for enforcement, banking details, and the original judgment. Enforcement officers open proceedings within three days, grant the debtor seven days to pay, and then proceed with forced collection if necessary.
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LawyerLegal assistance is provided by advocate Anton Grinewich, Specialized Legal Bar No. 2 in Minsk.
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