New Edict of the President of the Republic of Belarus No. 108 dated February 27, 2007 “On some measures on involvement into economic turnover of unused state property” (hereinafter – the Edict) regulates matters concerning conveyance of unused state property to market participants of non-state form of ownership. According to the Edict under unused state property is recognized property, which is assigned to republican and municipal legal entities on economic management or operative management right, as follows (hereinafter – the Objects):
buildings, constructions, lodgments (except for dwellings and accommodations)which have not been used in economic turnover for more than 2 years;
temporarily abandoned and unfinished buildings (except for dwellings and accommodations) the excess of term of construction of which over the normative term is more than 2 years, readiness degree of which does not exceed 60 %, and which are not reclaimed by republican and municipal legal entities.
Specific list of the Objects is confirmed by the Government of the Republic of Belarus before May 1st every year.
It is necessary to pay attention to the fact that the Edit covers only the Objects which are located on territories of such administrative units as village soviets, urban-type settlements, towns of district subordination and other small administrative-territorial units and territories. Otherwise, the Edict does not cover objects which are situated on the territory of large localities, such as towns of region subordination, region centers or Minsk.
Also the Edict does not cover the alienation of:
property, which have been withdrawn, arrested, confiscated, turned to state's income by another method, that is effected in the process of execution of court's decrees;
property of republican legal entity which is being liquidated in accordance with the legislation on economic insolvency (bankruptcy);
state property, being in the process of privatization according to the agreement on non-repayable (sponsor) help provision;
objects of export control (specific goods), including property of military purposes, and also unleashed material resources of the Military Forces of the Republic of Belarus;
property, which is a carrier of state secrets.
Article 1.1 of the Edict establishes the following means of transfer of the Objects to market participants of non-state form of ownership:
selling on auctions establishing starting sell price equal to 1 basic value;
transference to gratuitous use;
gratuitous transference to ownership.
Each of above mentioned means supposes that the one who has acquired the right has to comply with certain requirements. For example, when the Object is sold on auction with established starting sell price equal to 1 basic value, mandatory conditions for purchaser are:
carrying on business on the given object, creating additional working places;
prohibition of sale, other alienation of the Objects before the conditions of sales and purchase agreement are fulfilled by the purchaser.
Transfer of the Objects to gratuitous use is exercised under specific investment projects on the term of their realization and in accordance with the conditions of gratuitous use agreement. At the same time the conditions of such transfer are established by the Committee on involving into economic turnover of unused state property which is in the republican ownership. On the committee in the mandatory order should be included judges of the Supreme Economic Court, representatives of Committee of state control and officials from the state prosecutor’s office.
Concerning gratuitous transfer to ownership, it is exercised after extension of the term of gratuitous use and only if the user has fulfilled the conditions of gratuitous use. Monetary turnover on gratuitous transfer to ownership to market participants is not subject for taxation by taxes and levies collected to the republican budget.
According to the article 5 of the Edict local executive and administrative bodies are responsible for making decisions on providing land plots to purchasers of the Objects.
Although positions of the Edict are directed first of all on the involvement of private capital to belarusian hinterland, appearance of this act should be considered as a positive phenomenon, especially if to consider it as the ground basing on which administration of the state will make more determined steps towards privatization of ineffectively used objects.
