Draft Amendments to the Law on Consumer Protection – are Financial Services Consumers Protected Now?

Klim Stashevsky, Partner at Arzinger Law Offices, spoke at the Priorbank corporate business event on the 9th of October and shared invaluable insights from recent Belarusian and Russian EU General Court cases, revealing what actually works when challenging sanctions listings.

The main takeaways of Klim’s speech:

• The reality check: EU institutions protect EU institutions. Formal arguments rarely succeed – the Court follows "substance prevail over form”

• What can work: Demonstrating actual absence of connection/control and highlighting the EU Council's assessment errors – particularly effective when the evidence base is weak.

• The evidence challenge: The burden of proof largely falls on the applicant, while the Court doesn't require "ironclad" evidence from the Council.

• Critical lesson: Failing to disprove even one point means staying on the list. But the appeal process itself creates space for negotiations and reputational defense.

Winning is extremely difficult, but when the evidence base is genuinely weak, exclusion is possible. The sanctions landscape remains unstable, and the relevant practice continues to evolve.  Stay turned!

With the growing integration of international markets and the active development of investment projects involving Chinese partners, risk management is becoming particularly important for law firms and their clients.

Investments from China bring not only great opportunities for business expansion, but alsospecific challenges related to the legal, economic and cultural characteristics of the interaction.

Arzinger is a team of investment lawyers who are deeply immersed in the specifics of large investment and construction projects and have extensive experience working with foreign partners, including those from China.

We offer a comprehensive approach that goes beyond standard legal support: we manage risks, develop strategies and ensure reliable interaction with investors, customers,  contractors and regulatory authorities. Our goal is to guarantee the legal, financial and economic stability of the project by maintaining effective dialogue at all stages.

Drawing on many years of practical experience in supporting the most complex and large-scale construction projects, as a senior partner at Arzinger with experience as a diplomat, investment consultant and banker, I would like to share key risk management methods in construction.

Our approach is based on risk management through control points – key stages at which interim results are recorded and risks are assessed, ranging frompolitical risks to the risk of commercial information leaks. For ease of analysis, we use a ‘traffic light of success’: green for minimal risks,  yellow for insignificant risks, and red for significant risks requiring management decisions.

At Arzinger, we are confident that the success of large projects is born precisely where people know how to manage risks and transform them into competitive advantages.

Key stages (control points) of risk management:

1.Project financing

At this stage, the main focus is on a comprehensive analysis of the risks associatedwith project structuring. Inconsistencies between the legal and financial structures must be avoided, as they are a red flag that can lead to conflicts. We carefully check the possibility of carrying out planned control measures toidentify and eliminate threats in a timely manner.

We also analyze the terms of return on investment and investor guarantees, assess insurance policies and obligations, as well as the credit worthiness of key counterpartiesto reduce the risk of their failure to fulfil their contractual obligations.

2.Selection and delivery of complex technological equipment

Risks are associated with the technical compliance of equipment with declared standards affecting the quality and safety of the project. We monitor prepayment and return conditions, recommending optimal security measures, including advance payment guarantees, contract performance guarantees and warranty obligations.

Particular attention is paid to procurement procedures, marketing research, logistics, customs and sanctions risks that could complicate delivery. It is important to correctly formalize the transfer of ownership in the case of phased deliveries in order to protect the customer's interests.

This systematic approach helps to identify threats and create a reliable legal foundation for the successful implementation of projects.

3.Design

At this crucial stage, we focus on assigning responsibility for the accuracy of the initial data and correctly formulating the technical specifications. It isi mportant to monitor the execution and acceptance of design work, as well as to obtain a positive expert opinion and approval of the design documentation.

In legal support, we check the legal status of the designer, land documents, permits and expert documentation, including state construction and, if necessary, environmental expertise. We pay special attention to contracts with designers, copyrights, agreements on the transfer of rights and non-disclosure agreements to protect technical information and maintain competitive advantages.

As implified scheme for designing and commissioning facilities is actively used with clients who are residents of Great Park – see our previous article.

4. Synchronizationof key processes

The successful implementation of a project largely depends on the coordination of financing schedules, equipment delivery and construction work. We monitor this process to prevent downtime and ensure the precise timing of all stages.

5.Equipment testing and acceptance

For complex technological equipment, we organize testing to achieve guaranteed technical performance. The result is an equipment acceptance certificate after comprehensive testing, which confirms that the facility is ready for the next stage.

6. Acceptance and commissioning

Once construction is complete, we assist with the customer's acceptance of the facility and obtain all necessary official approvals from the relevant government authorities. This is an important final legal and technical step before launch.

7. The final milestone – a successful launch

And, of course, nothing compares to the moment when the facility is commissioned – when the red ribbon is cut and the team and investors can celebrate the beginning of a new success story.

This step-by-step, detailed and legally sound approach helps Arzinger ensure the stability and success of even the most complex investment and construction projects.

On 19 January 2023, Belarus has officially permitted the use of design documentation developed in foreign countries, including the People's Republic of China. This rule is confirmed by the Decree of the President No. 9 dated 17 January 2023 and established in a number of national regulations.

A special procedure for the adaptation and acceptance of facilities applies within the framework of international agreements, for example, for the Great Stone China-Belarus Industrial Park. This approach not only integrates Chinese construction standards with Belarusian requirements, but also significantly reduces construction time and costs.

Resolution of the Council of Ministers No. 87 dated 31 January 2018, as amended, regulates the simplified procedure for the design and acceptance of facilities into operation. Design documentation developed in accordance with Chinese standards undergoes expert review in the PRC and mandatory adaptation by Belarusian designers, followed by state construction expertise on key criteria: mechanical strength, stability and environmental protection.

Acceptance of facilities is carried out according to special rules. Requirements relating to architectural, urban planning and construction activities are excluded, and the assessment of the facility focuses on three main aspects: compliance with the approved design documentation, achievement of technical and economic indicators, and readiness of the engineering infrastructure for operation.

Quality and safety are confirmed by the conclusions of state bodies such as the Department of Construction Control and Supervision, the Ministry of Emergency Situations and the Republican Centre for Environmental Expertise (the Department of Nuclear and Radiation Safety of the Ministry of Emergency Situations - when accepting facilities under its control into operation).

Among the facilities already commissioned are modern production complexes, logistics centers and sports facilities that meet international standards.

The experience of successful cooperation with Chinese partners and the gradual harmonization of the legislation of the two countries confirm that the influence of the ‘Chinese architectural style’ in Belarus has become a symbol of openness, innovation and mutual respect, reflecting the strategic partnership between the two nations and the spirit of the times.

VAT on the purchase of services from a foreign company and assignment of claims

In Belarusian business, there are often situations where services are purchased from foreign contractors. At first glance, it may seem that the tax implications are obvious. But in practice, there are many nuances. One of them is related to the assignment of claims.

Client's situation

A Belarusian organization (the Customer) concluded an agreement with a Serbian law firm (the Contractor). Services were provided inthe amount of  1,000 euros.

Under the terms of the agreement:

• the place of performance of the services is the Republic of Belarus;

• the currency of the agreement is the euro, the currency of payment is the Russian rouble;

• the Contractor assigned the right to claim payment to a Russian individual entrepreneur.

The client had the following questions:

• Is it necessary to charge VAT when concluding a claim assignment agreement?

• How to correctly determine the tax base if the agreementis in euros and the payment is in Russian roubles?

Our tax practice position:

• the date of the claim assignment agreement is the date of actual performance, on which date the Belarusian customer is obliged to charge and pay VAT to the budget;

• the tax base is determined based on the cost of services under the agreement;

• if the agreement is concluded in EUR and payments are to be made in Russian roubles, the VAT tax base is determined based on the amount of remuneration under the agreement converted at the official exchange rate of the Belarusian rouble to the Russian rouble set by the National Bank of the Republic of Belarus on the date of assignment of the claim.

In this case, the tax base includes the entire amount of remuneration without reduction by the amount of tax on the income of foreign organizations.

What this means for business

• The obligation to pay VAT arises on the date of assignment of the claim.

• The currency of the agreement and the currency of payment are important. Errors in determining the tax base due to exchange rate differences can result in additional charges for the company.

• It is necessary to record the moment when the obligations cease. Payment, set-off, assignment ‒ each of these actions may become the moment of actual realization for VAT calculation purposes.

Our comment

We recommend that companies working with foreign counterparties:

• analyze the tax implications of the agreement in advance;

• take into account the difference between the agreement currency and the settlement currency;

• record the date of termination of obligations;

• if in doubt, seek clarification from consultants.

This approach reduces the risk of tax claims and avoids additional VAT charges.

If your company has questions about contracts with foreign partners and the tax implications of such transactions, contact us.  We are ready to help.

Klim Stashevsky and Vladislav Korzun , Arzinger lawyers, commented on the decision and discussed how the case would have turned out if it had beenheard in Belarus.

The main outcome for Google: the company retained its Chrome browser and Android mobile operating system, but must comply with serious restrictions in the area of data sharing and exclusive agreements.

WHAT THE COURT RULED

• •No need to sell the business

The Department of Justice demanded the forced sale of Chrome and Android, but the judge ruled that such a measure was excessive and harmful to the rapidly developing market. The ruling explicitly states that Google ‘will not be forced to sell Chrome; nor will the court include the conditional sale of Android in its final decision.’ This is a significant victory for the company, which has avoided a forced break up of its business and retained control over its key products.

• Mandatory Data Licensing

Instead of a division, the court ordered Google to open access to its search index and click data to ’qualified competitors"of the IT giant. Advertising data is excluded. This measure should ‘open up the market for general search services’ and increase competition. As the judge notes, without access to the search index and click data, no competitor will be able to develop a full-fledged search engine.

• Ban on Exclusive Agreements

Google will no longer be able to enter into or renew contracts that require manufacturers to install Chrome, Google Search, Google Assistant or Gemini in exchange for access to Google Play. Previously, this practice effectively cemented the company's monopoly: in 2020, Google accounted for 95% of mobile search queries in the United States. Now, smartphone manufacturers will be able to pre-install third-party services without the risk of losing Google's app store..

• Maintaining Payment Agreements with Apple and Other Partners

Google is permitted to continue making billion-dollar payments to device manufacturers for distributing search services. However, exclusive payments remain prohibited: partners will be able to work with Google, but without any obligation to ignore competitors. The judge explained this by the need to maintain balance – a complete ban on remuneration would harm users and the market. It is estimated that Apple alone receives around $20billion from Google annually.

• Focus on the Development of Generative AI

The judge emphasized that the emergence of powerful generative models such as ChatGPT has transformed the competitive landscape. In the court’s view, it is crucial to prevent Google’s dominance in traditional search from extending to the market for generative AI services. This consideration was one of the key factors behind the choice of more moderate remedies: the judge acknowledged that he had to “dip into the future,” anunusual task for the judiciary.

REACTION OF THE PARTIES AND POSSIBLE IMPLICATIONS

Google viewed the decision as a partial victory but warned of risks to user privacy. The company said in a statement: ‘The court has restricted the distribution of our services and requires us to share search data with competitors. We are concerned about how this will affect user safety.’ The corporation intends to appeal the decision, which could delay its implementation for years.

The US Department of Justice welcomed the decision, noting its importance for ‘opening up the market for general search services. ’The agency is simultaneously considering additional measures to prevent Google's dominance in the field of artificial intelligence.

The decision can be called a compromise: the court sought a balance that would allow the ruling to stand up in the Supreme Court. At the same time, it is part of a global trend towards increased antitrust pressure on Big Tech. Meta, Amazon and Apple are also under investigation. Another case is also ongoing against Google itself – regarding its monopoly in the advertising technology market.

WHAT THIS MEANS FOR BELARUS

• Perspective under National Law

In our previous article the lawyers analyzed in detail how such violations could be classified under Belarusian law. At that time, it was expected that the court might order the forced sale of the Chrome browser, prohibit payments to partners, and oblige Google to license search data. However, in the end, the court limited itself to requiring Google to share data and refrain from exclusive agreements.

For small markets, this approach can be particularly effective: transferring data to competitors allows the market to be balanced without painful business divisions. However, it is extremely important to ensure the protection of personal information.

The emergence of generative models, which the court cited as a key factor, indicates that competition in the search market is moving into new areas. This is also relevant for regulators around the world: regulation must keep pace with technology to prevent dominance from shifting from one area to another.

Overall, the court applied measures to Google that are similar to those that could be applied in Belarus in a similar situation.

• Belarusian Practice: Can a Court ‘argue’ with MART?

In the American case, many noted an interesting point: the regulator insisted on a strict separation of the business, while the judge proposed a different, less destructive option.

In Belarus, this combination – the antitrust authority and the court – works a little differently. In our legal system, MART has broad powers and can issue decisions and binding orders requiring the violator to take any action that the regulator deems necessary to ensure compliance with antitrust legislation, with the exception of the requirement for forced separation, which MART can only request in court.

Such decisions and orders by MART can be challenged in the economic court, but statistics on appeals show that such attempts are extremely ineffective. According to MART data, only 15-20% of its decisions are appealed in court, and in approximately 90% of cases, the court upholds there gulator's position. In 2021, for example, all appealed MART rulings were upheld, except for one: the case of cartel collusion in the plant protection products market. In this case, the Supreme Court recognised that the agreement between August-Bel CJSC and its dealers on market sharing had not been proven, and the relevant part of the MART decision was overturned. However, the court confirmed the existence of price collusion and upheld the fines imposed on the cartel participants. It is noteworthy that the court ordered MART to reimburse part of the legal costs incurred by the applicants in appealing the regulator's decision, restoring the balance of interests in this part.

Other attempts by businesses to challenge MART's conclusions were less successful. For example, companies involved in a cartelcase in the veterinary drugs market filed complaints, but the Supreme Court upheld the regulator's ruling. In the dispute over unfair competition between Krinitsa OJSC and MART over the Buratino product brand, the court also upheld the agency's position.

Thus, there are no precedents in Belarusian practice where the court has radically revised the competition protection measures proposed by the agency, as has happened in the United States. Courts usually review evidence and procedural aspects, but do not take the initiative or formulate alternative ‘remedial’ measures.

WHAT BUSINESSES CAN LEARN FROM THIS COURT DECISION

The US court's decision in the Google case reflects a global trend towards tighter antitrust regulation of technology companies, but with consideration for the specific characteristics of rapidly developing markets. Judge Mehta chose ‘treatment’ over ‘amputation’ – he banned anti-competitive practices but preserved the company's innovative potential, without forgetting the interests of ordinary users.

• Data is a key asset

An American court has recognised that access to data is critical for competition in the digital age. This could become an important tool in the arsenal of Belarusian regulators and a positive incentive to update legal regulation in relevant areas.

• Balancing competition protection and innovation is the main goal

Measures should prevent the transfer of dominance to new technological areas, especially in the field of artificial intelligence, but in no case should they limit the potential of technology. Regulation must be impartial, fair, preventive, and any punishment must be proportionate to the violation.

• Keeping up with the times is one of the main tasks of legislators and regulators

The case against Google is not yet closed: the company intends to appeal the decision in the court of appeal. The outcome could set a precedent for other countries and influence approaches to regulating digital markets. However, this case already confirms that the legal instruments for influencing violators of antitrust legislation are becoming increasingly sophisticated and technology-oriented, and even IT giants are forced to adap ttheir business models in order to maintain fair competition.

Belarusian businesses should keep a close eye on such cases, as in the era of globalisation and digitalisation, national approaches to antitrust regulation are increasingly influencing each other, forming new standards of fair competition.

Well-chosen instruments for securing obligations make it possible to increase the responsibility of counterparties and protect property interests.

Key risks when cooperating with Indian counterparties

Cooperation with Indian counterparties may be accompanied by certain risks, including:

— delivery delays and logistics issues;

— nonconformity of supplied goods and equipment quality;

— problems with advance payment refunds in the event of non-performance or improper performance of obligations;

— currency fluctuations and bank sanctions.

The occurrence of such risks may significantly affect the company's activities, causing significant financial losses, reputational damage and other negative consequences. In such circumstances, it is important to include reliable security instruments in the contract to minimize the remoteness of negative consequences and ensure the stability of business processes.

Security instruments under Belarusian law

Belarusian legislation allows the use of any means of securing the performance of obligations, including those not provided for in the Civil Code. Among the most well-known and actively used methods by Belarusian counterparties are the following:

— bank guarantee and letter of credit;

— penalty;

— surety;

— pledge of movable and immovable property;

— retention of the debtor's property;

— deposit;

— insurance of financial risks.

In practice, financial risk insurance, particularly for the risk of non-return of advance payments, is especially relevant when dealing with foreign counterparties. However, despite the fact that insurance is one of the most reliable ways to protect property interests, not every insurance company is willing to cover such risks. In this regard, we recommend agreeing in advance with a specific insurance company on the terms and scope of insurance coverage.

Common Security Instruments in Indian Practice

When concluding contracts, Indian counterparties usually offer the Belarusian side the security instruments that are accepted in the local business culture and often differ from those familiar to the Belarusian parties. The most commonly used instruments proposed by Indian counterparties include corporate guarantees and the opening of an escrow account.

Corporate guarantee

A corporate guarantee is a three-party agreement in which one company acts as a guarantor for another company's obligations to a buyer. This type of guarantee is very similar to the Belarusian institution of suretyship and requires:

— the mandatory participation of three different parties;

— clear identification of the guarantor and the principal;

— sufficient solvency of the guarantor.

It should be noted that in practice there have been cases where the Indian side offered a corporate guarantee where the guarantor and the principal were the same. Such ‘guarantees’ may be deemed invalid, since when the guarantor and the principal are the same, the mandatory presence of three parties and the security nature of the guarantee are lost in this case.

Escrow account

An escrow account is a security mechanism whereby a third party (bank/escrow agent) accepts and holds funds provided for in the contract until the parties fulfil the agreed conditions.

It should be noted that escrow account agreements are familiar to Belarusian law and regulated by Article 774-1 of the Civil Code, as well as by the provisions of the Banking Code of the Republic of Belarus.

In India, escrow accounts are widely used on the basis of the following acts:

— Securities and Exchange Board of India (SEBI) Rules, 2011;

— Real Estate Act, 2016;

— Circulars and instructions of the Reserve Bank of India (RBI);

The requirements for opening escrow accounts under Indian law vary depending on the situation. For example, in transactions involving securities and shares, between 10% and 25% of the total consideration must be placed in escrow. In the case of a minimum acceptance condition (i.e., a minimum number of shares required to be sold under the offer), up to 100% of the consideration may be required in escrow, depending on the structure of the offer.

Failure to comply with the rules established for escrow accounts may result in penalties.

Security deposit and retention money

Along with corporate guarantees and escrow accounts, other methods of securing performance are well known and widely used in India, such as security deposits and retention money.

— Security deposit in India is usually used in lease agreements, but in theory it can be used on the basis of freedom of contract in relation to other agreements and, therefore, recognised by Indian courts.

— ‘Retention money’ is a percentage of the total contract amount, usually between 5% and 10%, retained by the customer. In practice in India, this is most often used in construction contracts, but, as mentioned above, it can be used in other contracts based on the principle of freedom of contract. A similar practice is actively used in Belarusian construction practice.

Recommendations for choosing the optimal instrument

In order to minimize the risks that may arise when dealing with Indian counterparties, we recommend that you determine and agree in advance on appropriate methods of securing the performance of obligations. In particular, we offer the following practical advice:

— Carefully study the methods of security offered by the Indian party — they may differ significantly from the usual Belarusian instruments.

— When using corporate guarantees, always check that the guarantor is a separate legal entity with sufficient solvency.

— Consider financial risk insurance as an additional means of protecting your interests.

— When working with escrow accounts, carefully study the requirements of Indian law for their opening and maintenance.

— Take into account the principle of freedom of contract — a corporate guarantee, although not mentioned in the Belarusian Civil Code, may be used as a means of securing obligations.

Conclusion

Working with Indian counterparties requires a careful approach to selecting appropriate security instruments. Each instrument has its own advantages and limitations, and only a carefully thought-out protection strategy will help minimize financial risks.

Arzinger's experts are ready to conduct a detailed analysis of your specific project, select the optimal security mechanisms and ensure the reliable implementation of your foreign trade contracts.

Ready to discuss the details of your project? Contact us.

Dear colleagues, partners and friends,

This week we are celebrating the 19th anniversary of Arzinger company in the Republic of Belarus❣️✨

Founded in Berlin in 1990 by Dr. Rainer Arzinger, this German law firm quickly became international, opening offices in Vienna, Prague, Budapest, Kiev, Moscow and other cities. In 2006, it entered Belarus - on July 12, an Agreement was signed between the founding partner of the German company Rainer Arzinger and the founding partner of the Belarusian company Sergey Mashonsky.

Over the past years, serious work has been accomplished, and we are proud of the results. We have implemented unique projects, become a reliable legal partner in major investment, construction and IT projects, support the organization of major production facilities, and protect our clients' interests in any jurisdiction.

We constantly strive to help every client, regardless of its country location.

Our knowledge, experience and work are directed toward the prosperity of our clients, and therefore toward the prosperity of our country, our children, grandchildren and descendants. We are proud of the cultural and historical past of our homeland. We participate in social projects, set ambitious new goals for ourselves and every day justify the trust of our clients so that they remain confident in our reliability, integrity and our adherence to the high standards of the legal profession.

I wish you and your families health, happiness, prosperity and all the best! And, of course, I would like to thank all my reliable partners, lawyers, financiers and the specialists of the team.

I wish the entire Arzinger team new victories and achievements!

Your senior partner Sergey Mashonsky

On June 26–27, 2025, the Minsk International Exhibition Center hosted the Fourth Eurasian Economic Forum.

The forum``'s highlight was the plenary session, titled “Eurasian economic integration strategy: achievements and prospects.”  This session brought together government officials, business leaders and leading experts of the Eurasian Economic Union countries.

We are proud to note the participation of Sergey Mashonsky, Senior Partner at Arzinger Law Offices, in this session.

For Arzinger participation in such events is not just a status and recognition of our professional experience - it reflects our commitment to driving economic and legal progress in the region.

Arzinger: follow the trends, share expert opinion!

Elena Mashonskaya, Head of Real Estate and Construction Practice at Arzinger Law Offices, spoke at the online event " Construction contracts: real cases, practical solutions" on the topic "Contract for design and survey works: How to protect the customer's interests".

During the presentation Elena covered key problems faced by customers, including:

proper drafting of the contract;

the most contentious clauses frequently disputed in court and the reasons behind such challenges

acceptance of project deliverables without in-house technical experts;

actions in case of violation of deadlines or refusal of the designer to correct defects;

legal termination of contracts with an unreliable contractor.

In conclusion, participants analyzed real-life case studies and discussed strategies to prevent conflicts at the contracting stage.

Need a reliable contract? Contact us!

Sanctions have fundamentally altered the rules of international trade, creating new challenges for businesses. Even companies not directly targeted by restrictions face their consequences - disrupted supply chains, blocked payments and legal uncertainty.

In his speech Sergey Mashonskiy discussed the main sanctions regimes, outlined key implications for businesses, shared insights on new sanctions against Belarus, and highlighted measures to help mitigate risks.

The seminar participants were most interested in the part of the speech where Sergey Mashonsky presented the company's successful cases in international arbitration dispute resolution.