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27 december 2022

Currency equivalent under lease agreements: it is possible

In connection with adoption of the Law No. 197-Z “On Amending Laws on the Securities Market” (the Law No. 197-Z), in Belarus starting from September 23, 2022 till January 1, 2024 the right of the lessor to determine the amount of rent in the currency equivalent in the agreement was suspended. This ban has raised a lot of doubts about what types of leases it applies to, in particular, whether the new rule concerns payments under lease agreements.

The ambiguity in the interpretation of the norm of the Law was eliminated by the adoption of the Law No. 224-Z dated December 9, 2022: now the legislator directly determines that the rule on the suspension of the possibility to determine the amount of rent in the currency equivalent does not apply to relations arising from financial lease agreements, and this exemption is valid since September 23, 2022.

Apparently, the exception made for lease agreements is directly related to the anxiety that arose in the financial sector after the adoption of the Law No. 197-Z: bank loans have always been and will be the main source of financing for leasing companies, and the lack of settlements synchronization between loan obligations and lease agreements carried great risks for financial market participants.