The Constitutional Court of the Republic of Belarus, comprising of the Presiding Officer — Chairman of the Constitutional Court G.A. Vasilevich, Deputy Chairman A.V. Maryskin, judges G.A. Vorobei, K.I. Kenik, A.A. Sarkisova, A.G. Tikovenko, R.I. Filipchik, G.B. Shishko, V.Z. Shuklin, has examined on the grounds of Article 40, part one of Article 116 of the Constitution of the Republic of Belarus, Article 18 of the Law of the Republic of Belarus “On status of a deputy of the House of Representatives, member of the Council of the Republic of the National Assembly of the Republic of Belarus” complaints of citizens and address of V.V. Novosyada, deputy of the House of Representatives of the National Assembly of the Republic of Belarus, on the issue of lawfulness of collection by the courts of law into the state budget of foreign currency as a subject of loan contracts concluded by the citizens therebetween.

     Having analyzed the provisions of the Civil Code and the Banking Code, Decree of the President of the Republic of Belarus of 5 February 1997 No. 1 “On measures on securing order while carrying out currency operations” (hereafter is referred to as Decree No. 1), other enforceable legal acts, including the acts of the National Bank of the Republic of Belarus regulating the procedure of making currency operations in the territory of the Republic of Belarus, the Constitutional Court found the following.

     According to point 3 of Article 760 of the Criminal Code foreign currency may be subject of a loan contract in the territory of the Republic of Belarus with the observance of the rules of Articles 141, 142 and 298 of the specified Code.

     Article 141 of the Civil Code shall envisage that belarusian rouble is the lawful medium of payment in the territory of the Republic of Belarus. Instances, procedure and conditions of use of foreign currency in the territory of the Republic of Belarus shall be specified by the legislation.

     According to Article 298 of the Civil Code pecuniary obligations should be expressed in belarusian roubles. Pecuniary obligation may envisage that it is subject to be paid in belarusian roubles in sum which is equivalent to the fixed sum in foreign currency or in standard monetary units. In that case the sum which is subject to be paid in roubles shall be specified at official rate of exchange of the relevant currency or in standard monetary units on day of payment, unless otherwise other rate or other date of its specification are not stipulated by the legislation or by an agreement of parties. Use of foreign currency while making payments in the territory of the Republic of Belarus under the obligations shall be admissible in instances, according to the procedure and under the conditions stipulated by the legislation of the Republic of Belarus. Similar approach is envisaged in Article 11 of the Banking Code of the Republic of Belarus.

     The Constitutional Court emphasizes that the Civil Code and the Banking Code shall envisage the possibility of use in the territory of the Republic of Belarus of foreign currency according to the procedure of permission — in instances under the procedure and under the conditions stipulated directly by the legislation.

     Legal regulation of use by the citizens of foreign currency in the territory of the Republic of Belarus shall be exercised both by the legislative acts (for example, by Decree of the President of the Republic of Belarus of 20 April 1998 No. 4 “On guarantees of safety of currency resources of natural persons which are onto the accounts and deposits in the banks of the Republic of Belarus”, by Resolution of the Supreme Council of the Republic of Belarus of 20 March 1992 “On temporary proceudre of currency regulation and making currency operations in the territory of the Republic of Belarus”) and by enforceable legal acts of the National Bank of the Republic of Belarus.

     Decree of the President of the Republic of Belarus of 23 February 2000 No. 87 “On improvement of the system of currency regulation and currency control in the Republic of Belarus” has granted the National Bank the right to specify the sphere and procedure of circulation in the Republic of Belarus of foreign currency and payment documents in foreign currency, including the rules of making by residents and non-residents of operations with foreign currency, with the payment documents in foreign currency (sub-item 2.2.1), to set the rules of issue of special permissions (licences) for making currency operations and to give those permissions (licences) (sub-item 2.2.2).

     Provision on the procedure of making currency operations in the territory of the Republic of Belarus, approved by the Board of the National Bank of the Republic of Belarus of 25 June 1996 shall envisage that citizens-residents (natural persons who have permanent place of residence in the territory of the Republic of Belarus, including those who temporaritly are out of the bounds of the Republic of Belarus) and non-residents (natural persons who have permanent place of residence out of the bounds of the territory of the Republic of Belarus, including those who temporaritly are in the Republic of Belarus) may have privately owned currency values brought, transferred or forwarded in the Republic of Belarus from abroad, received or acquired in the territory of the Republic of Belarus in accordance with the effective legislation, to keep money (as deposits or on accounts with the authorized banks and to use them for the purposes which are not prohibited by the legislation of the Republic of Belarus (sub-item 9.1). At the same time, it is banned to grant foreign currency loans by citizens-residents for legal persons-residents (sub-item 9.11).

     Decree No. 1 shall specify the procedure of making some currency operations (operations with participation of natural persons on purchase and sale and cash foreign currency exchange and payment (cash items) documents in foreign currency), as well as shall stipulate the sanctions for the violation of the envisaged in point 1 of the given Decree and in other acts of legislation procedure of making currency operations, including for the use of foreign currency without the relevant permission (licence). Violation of the procedure of making currency operations shall entail responsibility under the legislation of the Republic of Belarus. The same Decree shall establish administrative responsibility for making currency operations (buying up, sale, exchange of foreign currency, including in belarusian roubles and in other property) or other use of foreign currency without the relevant permission (licence) (sub-item 2.1); pestering (repeated proposal) citizens with the purpose of purchase and sale, foreign currency exchange (including in belarusian roubles and in other property) (sub-item 2.2); violation of the procedure of making currency operations which are not connected with the offences under sub-items 2.1 and 2.2 in instances specified by the National Bank (sub-item 2.3). As a result of calling to responsibility on the grounds of sub-items 2.1 and 2.2 of point 2 of Decree No. 1 foreign currency and other money resources, which were found by guilty persons at the moment of committing offence, shall be subject to confiscation and shall be recovered into the republican revenues.

     Thus, in accordance with the legislation confiscation shall be applied not for any violation of the procedure of making currency operations, but for making such an operation without licence.

     Making by citizens currency operations without the relevant permission (licence) shall also entail application by the courts of law on the grounds of Article 170 of the Civil Code of such a measure as recovery of all the obtained by the parties under transaction into the revenues of the Republic of Belarus. Moreover, according to point 2 of Article 167 of the Civil Code the requirements on establishing the fact of nullity of a transaction and on application of the consequences of its invalidity may be made by any interested person. The court of law shall have the right to apply those consequences on its own initiative. Due to the fact, that a nullity transaction is invalid by force of the law, the court of law, in the opinion of the Constitutional Court, shall have the right to apply the specified by the law consequences of that kind of transaction both in case of making by an interested person of the requirement on establishing the fact of its nullity and in case of finding the grounds of nullity while considering another requirement. Such a right of the court of law is also following from Article 273 of the Civil Code of Procedure.

     In accordance with sub-item 2.6 of point 2, with point 22 of the Rules of making currency operations connected with the movement of capital, approved by Resolution of the Board of the National Bank of the Republic of Belarus of 28 April 2001 No. 100, natural persons-residents (natural persons who have permanent place of residence in the Republic of Belarus, including those who temporaritly are out of the bounds of the Republic of Belarus), are allowed, without drawing up in the National Bank of a separate permission to make the definite type of a currency operation connected with the movement of capital, to raise loans for a period of more than 180 days from non-residents (natural persons who have permanent place of residence out of the bounds of the territory of the Republic of Belarus, including those who temporaritly are in the Republic of Belarus).

     The Constitutional Court pays also attention to the necessity of such a legal regulation of relations in the field of conclusion by citizens of the foreign currency loan contracts which shall secure its unique understanding and application.

     Guided by Article 40, part one of Article 116 of the Constitution, Articles 7, 11, 36, 38, 40, 40¹ of the Law “On the Constitutional Court of the Republic of Belarus” the Constitutional Court

RULED:

1. To note, that the legislation of the Republic of Belarus shall allow for the natural persons-residents (natural persons who have permanent place of residence in the Republic of Belarus, including those who temporaritly are out of the bounds of the Republic of Belarus), without drawing up in the National Bank of a separate permission, to make the definite type of a currency operation connected with the movement of capital, to raise loans for a period of more than 180 days from non-residents (i.e. natural persons who have permanent place of residence out of the bounds of the territory of the Republic of Belarus, including those who temporaritly are in the Republic of Belarus).

2. To propose the Procurator’s Office of the Republic of Belarus to study the practice of application by the courts of law of the legislation on currency regulation, including while concluding by the citizens of the Republic of Belarus of foreign currency loan contracts with the purpose of possible improvement of the legislation and law applicable practice in that sphere for more full protection of the property rights and lawful interests of citizens.

3. The present Decision shall come into legal force from the date of its adoption.

4. To publish the present Decision in accordance with effective legislation.

Presiding Officer —

Chairman of the Constitutional Court

of the Republic of Belarus                                                                                               G.A. Vasilevich