menu

EFFECTIVE DEBT COLLECTION IN BELARUS:
WRIT PROCEEDINGS

17.01.2020
According to the data of World Justice Project, Belarus ranked 43 out of 126 countries on civil justice. Belarus' score places it at the 1st place out of 13 countries in the Eastern Europe and Central Asian region and 11 out of 38 among upper middle-income countries. [1]

The key point is that civil justice in Belarus is open for both domestic companies and foreign ones. Any foreign company can recover debts from its Belarusian partner, having various procedures available for that purpose.

Specific attention is to be paid to a simplified procedure of debt collection called "writ proceedings", which allows a foreign company to save a deal of time and money in comparison with debt collection through action proceedings. Moreover, Belarusian law allows initiating writ proceedings even when the parties have an arbitration or prorogation (a concrete state court is chosen) clause in their contract.

Writ proceedings: introduction

The law of Belarus provides for an opportunity to initiate a simplified procedure of debt collection – writ proceedings – to recover debts from a company or a private entrepreneur, registered in Belarus [2] .

The peculiarity and undeniable advantage of writ proceedings is that the case is considered by court without summoning the parties, solely on the basis of written evidence provided by them [3] . In comparison with action proceedings, the case in writ proceedings is considered much faster and the state duty for consideration of an application for commencement of writ proceedings is lower than for consideration of a statement of claim.
*1 base unit = 27 BYN (about 11,5 EUR) [5]
The statistics shows, that writ proceedings is one of the most effective ways of dispute resolution in Belarus. For comparison, in the first half of 2019, the Economic Court of the city of Minsk solved 2 871 cases through action proceedings and 8 650 through writ proceedings [6] .

When to initiate?

A creditor has the right to initiate writ proceedings against a Belarusian debtor, if a claim is based on documents confirming debt, recognized or not disputed by the debtor [7] . For instance, if the debtor left a creditor's pre-trial claim unanswered within the deadline stipulated by a contract or applicable law, the unanswered pre-trial claim will serve as a confirmation that the debt is not disputed by the debtor and in this case the creditor may initiate writ proceedings.

Writ proceedings can not be initiated against a debtor, registered in any state, other than Belarus [8] .

The following claims are not subject to consideration in writ proceedings [9] :
- reclamation of property by an owner or other legal possessor;
- performance of a guarantee obligation (except for a bank guarantee);
- performance of an obligation arising from an agreement on assignment or transfer of a debt (except for cases of a written acknowledgment by the debtor of the debt);
- claims, when recovery must be made by a notary's executive inscription;
- claims against a debtor being in the process of bankruptcy.

How to initiate?

To initiate writ proceedings the creditor collects and submits to a competent Belarusian court an application for commencement of writ proceedings, evidence confirming the facts on which the claim is based, evidence confirming claim's indisputable nature and confirmation of payment of a state duty.

To be considered:

The full list of the documents to be submitted varies depending on the case, therefore it is highly advised to engage in dispute resolution process local lawyers, who will take care of proper submission of documents, control the process of debt recovery in Belarus or, in case of necessity to initiate action proceedings, will further represent the creditor's interests in court.

If a judge finds that there are sufficient grounds to commence writ proceedings, a corresponding court ruling will be sent to the debtor. After that one of the following options is possible:

1. If a debtor does not provide the court with a response to the creditor's application within 7 business days or agrees with the amount claimed, the court will issue a writ to recover the debt [10] ;

2. If a debtor sends to the court a response challenging the amount claimed within 7 business days, the court will refuse to issue a writ and will provide the creditor with 15 business days for additional payment of a state duty and transfer of the case into action proceedings [10] .

The experience of our Law Office shows that debtors clearly understand their chances to win the case and risks to incur additional judicial expenses, including an increased state duty when transferring the case into action proceedings and creditor's expenses to legal assistance, which may be assigned to debtors in case of loss. Therefore, the debtors often recognize (or do not dispute) the amounts claimed and the cases end in the creditors' favor by issuing writs.

What's next?

If the court refused to issue a writ, the parties will continue to solve their dispute through action proceedings.

If a writ to recover the debt is issued, the creditor applies for its enforcement in accordance with the procedure established by the law of Belarus.
[1] http://data.worldjusticeproject.org/#/groups/BLR

[2] Article 222 of the Economic Procedural Code of the Republic of Belarus (hereinafter referred to as the "EPC")

[3] Article 220 of the EPC

[4] Annex 15 to the Tax Code of the Republic of Belarus

[5] Amount of a base unit as of 17 January 2020

[6] http://www.court.gov.by/ru/ekonomicheskij/sud/goro...

[7] Article 220 of the EPC

[8] Article 222 of the EPC

[9] Articles 220, 222, 224 of the EPC

[10] Article 223 of the EPC

[10] Article 224 of the EPC
* This article is made as of 17 January 2020.

** This article is intended to provide general information and is not meant to be construed as legal advice.
Katsiaryna Buraya, Associate at Lex Torre Law Office
Katsiaryna Buraya,
Associate