Ill-considered export entails liability

The problem of non-payment risk in export supplies is becoming particularly relevant during a period when it is necessary to make the most efficient use of organizations' own working capital, upon the proper distribution of which depends not only their further financial stability but also the due realization of employees' rights to remuneration, timely and full fulfillment of tax obligations.

Currently, the region's prosecutor's offices are paying special attention to the issues of preventing the formation of overdue foreign accounts receivable (FAR) by enterprises in the region, as effective work in this area allows for the prevention of problematic debt formation.

As of January 1, 2020, the amount of overdue FAR of organizations in the region amounted to 23.5 million rubles and increased by 6.8% over the past year. As of February 1 of the current year, its amount was already 24.3 million rubles (+3.3% compared to the beginning of the year).

Unjustified diversion of funds into overdue FAR was facilitated by facts of inefficient organization of foreign economic activity with foreign buyers in terms of using the maximum possible economic protection mechanisms for Belarusian exporters. In particular, inadequate analysis of the financial reliability, solvency, and business reputation of foreign counterparties, inadequate assessment of the risk of non-fulfillment of foreign trade contracts, violations in the execution of foreign trade contracts (shipment of goods in the presence of unfulfilled payment obligations for earlier supplies), absence of local regulation of the pre-contractual work procedure, ignoring the possibility of insuring export risks, etc.

Modern information technologies make it possible at the stage of deciding to conclude an export contract to obtain maximum information about the counterparty's financial condition – about being in bankruptcy proceedings, about participation in court disputes as a defendant, about debts to the budget, and other information posted on the official websites of foreign government bodies, which allows assessing the risk of non-fulfillment of obligations.

payment in case of deferred payment.

In addition, on the official website of the Prosecutor General's Office, any business entity can familiarize themselves with the methodological recommendations for concluding and servicing foreign economic transactions aimed at reducing the risks of overdue foreign currency debt.

The final decision on concluding a contract and carrying out supplies is made exclusively by the head of the Belarusian supplier (or a person authorized by him), but the responsibility also lies with him.

At the same time, for each identified fact of violation of the requirements of legislation and local acts of the organization, the regional prosecutor's offices give a principled assessment, including for the presence of elements of administrative offenses and crimes.

In 2019, prosecutors conducted inspections of most of the problematic organizations engaged in the export of goods. A total of 11 inspections were carried out, and based on the identified violations, the same number of submissions were made. 16 officials were brought to disciplinary responsibility for improper performance of duties when concluding foreign trade contracts, controlling their execution, and conducting claim and litigation work.

In addition, 6 officials and 3 legal entities were brought to administrative responsibility.

The main violations that led to the adoption of administrative responsibility measures were the untimely completion of foreign trade operations (including due to improper claim and litigation work, inaction in resolving issues of extending the deadlines for completing export operations), violations of the requirements of legislation on exchange trading in exports, and distortion of statistical reporting data on the amounts of overdue foreign currency debt.

The regional prosecutor's offices pay special attention to analyzing the causes of overdue foreign currency debt formation related to the execution of contracts. The most common of these is the shipment of products to foreign counterparties when there is overdue debt for previously shipped batches.

In this case, if such a shipment was carried out in violation oflocal acts of the organization or the official duties of an authorized person, an assessment of the identified violations is already given in the plane of criminal law.

The prosecutor's offices of the region on a permanent basis provide assistance to state-owned enterprises and enterprises with a predominant share of state ownership in the authorized fund, which have overdue foreign currency debt, in the recovery of debts through court.

In 2019, prosecutors, in the interests of Belarusian supplier organizations, filed 6 lawsuits with economic courts for the recovery of debt in the amount of 97 thousand Belarusian rubles and 10 million Russian rubles, the measures taken allowed to return more than 5.7 million Russian rubles of foreign currency earnings to the enterprises' accounts. In the remaining part, the work will be continued at the stage of compulsory execution of court decisions.

Prosecutor of the Department of the Regional Prosecutor's Office
for Supervision of Legislation Enforcement
and Legality of Legal Acts
Pavel Sukhov