Getting the Deal Through – Outsourcing 2014 by Stepanovski, Papakul & partners LLC

Outsourcing in 21 jurisdictions worldwide Contributing editor: Mark Lewis

2014 Published by Getting the Deal Through in association with: Anderson Mo¯ri & Tomotsune Berwin Leighton Paisner LLP Carey Chiomenti Studio Legale Cuatrecasas, Gonçalves Pereira Demarest Advogados Dhir & Dhir Associates Dittmar & Indrenius Franklin Froriep Heymann & Partner Minter Ellison Lawyers SDM Partners Law Firm Stepanovski, Papakul & partners Venable LLP Vivien Chan & Co Von Wobeser y Sierra, SC Weinhold Legal v.o.s. Wistrand Advokatbyrå

contents

Outsourcing 2014

Overview Mark Lewis Berwin Leighton Paisner LLP

Contributing editor Mark Lewis Berwin Leighton Paisner LLP

Australia Anthony Lloyd, Anthony Borgese, Karen Payne and Gordon Williams Minter Ellison Lawyers

Publisher Gideon Roberton

Belarus N adya Hadanovich, Valentina Ogarkova and Sviatlana Valuyeva Stepanovski, Papakul & partners

Business development managers Alan Lee, George Ingledew, Dan White, Robyn Horsefield, Adam Sargent

Brazil C ássia Pizzotti, Renato Canizares, Ivan Lima, Eloisa Curi and Eduardo Santiago Demarest Advogados

Chile Oscar Aitken and Daniella Torres Carey

China Vivien Chan Vivien Chan & Co

Czech Republic Thilo Hoffmann and Lukáš Vrána Weinhold Legal v.o.s.

Finland Sakari Halonen Dittmar & Indrenius

France Bradley Joslove Franklin

Germany T homas Heymann, Katharina Scheja, Lars Lensdorf, Walter Born and Till Contzen Heymann & Partner

Hong Kong Vivien Chan Vivien Chan & Co

India Rahul Goel and Anu Monga Dhir & Dhir Associates

Italy Massimiliano Nitti and Roshanak Bassiri Gharb Chiomenti Studio Legale

Account managers Megan Friedman, Joseph Rush, Dominique Destrée, Emma Chowdhury, Lawrence Lazar, Andrew Talbot, Hannah Mason, Jac Williamson, Ellis Goodson Media coordinator Parween Bains Administrative coordinator Sophie Hickey Research coordinator Robin Synnot Marketing manager (subscriptions) Rachel Nurse

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Head of editorial production Adam Myers

Japan Atsutoshi Maeda and Takashi Nakazaki Anderson Mo ¯ri & Tomotsune

Production coordinator Lydia Gerges

Mexico Rodolfo Trampe, Jorge Díaz, José Palomar and Carlos López Von Wobeser y Sierra, SC

Senior production editor Jonathan Cowie

Portugal L eonor Chastre, Duarte Abecassis, João Mattamouros Resende, Lourenço Vilhena de Freitas and Sónia Queiroz Vaz Cuatrecasas, Gonçalves Pereira

Production editor Martin Forrest

Spain A lejandro Negro Sala, Carmen de Pascual, Juan Bonilla, Andrew Ward and Sergio Sanfulgencio Cuatrecasas, Gonçalves Pereira

Subeditor Anna Andreoli

Sweden Peter Helle and Karl Eckberg Wistrand Advokatbyrå

Director Callum Campbell Managing director Richard Davey Outsourcing 2014 Published by Law Business Research Ltd 87 Lancaster Road London, W11 1QQ, UK Tel: +44 20 7908 1188 Fax: +44 20 7229 6910

Switzerland Nicola Benz and David Vasella Froriep

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Ukraine Dmytro Syrota and Serhiy Dzis SDM Partners Law Firm

109

United Kingdom Mark Lewis Berwin Leighton Paisner LLP

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United States W illiam T Russell, James E Nelson, Nora E Garrote, Armand J (AJ) Zottola, Michelle Ontiveros Gross and Charles K Kolstad Venable LLP

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© Law Business Research Ltd 2013 No photocopying: copyright licences do not apply. First published 2013 First edition ISSN 2053-8979 The information provided in this publication is general and may not apply in a specific situation. Legal advice should always be sought before taking any legal action based on the information provided. This information is not intended to create, nor does receipt of it constitute, a lawyer–client relationship. The publishers and authors accept no responsibility for any acts or omissions contained herein. Although the information provided is accurate as of November 2013, be advised that this is a developing area.

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Belarus Nadya Hadanovich, Valentina Ogarkova and Sviatlana Valuyeva Stepanovski, Papakul & partners

Market overview 1

What kinds of outsourcing take place in your jurisdiction?

In the Republic of Belarus there are several kinds of outsourcing that typically occur: • IT outsourcing, which includes networks and IT infrastructure outsourcing; and • business process outsourcing, which comprises mostly finance and accounting and legal outsourcing. Some organisations provide HR outsourcing and logistic and transport outsourcing, but their market share is insignificant. 2 Describe the recent history of outsourcing in your jurisdiction. How well established is outsourcing? What is the size of the outsourcing market in your jurisdiction?

Outsourcing appeared in Belarus for the first time in 1993: the company IBM had developed software ordered from a remote location. Since then, outsourcing has begun to be widely applied in the IT sphere. Almost all types of outsourcing in Belarus appear on the basis of the provisions of chapter 39 of the Civil Code of the Republic of Belarus (Civil Code). As the regulation is not very stringent, it has enabled the development of outsourcing in different spheres and the popularity of such services is increasing from day to day. For example, outsourcing of legal services has become more appealing for companies that do not deal with legal problems every day but can encounter them from time to time. A similar scenario can be seen with other services. Statistics on the development of outsourcing in Belarus do not exist at the moment, but sample studies are conducted periodically. The last research on this subject was made by the Central and Eastern European Outsourcing Association in 2010 and it was dedicated to IT outsourcing. According to the data of this research the volume of the IT outsourcing market comprised approximately 3.5 trillion Belarusian rubles in 2009 and the growth of IT outsourcing export market was 10.84 per cent. Policy 3 Has the government of your jurisdiction adopted policies to encourage the development of the jurisdiction as an outsourcing centre, either for the domestic market or to provide outsourcing services to foreign customers?

The term ‘outsourcing’ is not used in the legislation or in other official documents of Belarus. All the existing policies that affect outsourcing are dedicated to the process of attracting foreign investment. For example, in application 2 of the Strategy of Attraction of Direct Foreign Investments to the Republic of Belarus for the period up to 2015, a creation of clusters is provided. A cluster is a union of several organisations, where an organisation that carries out the production www.gettingthedealthrough.com

of a final product is a key organisation (or the heart of a cluster), and other organisations, which provide services to the key organisation, have an auxiliary character. This means that these organisations provide outsourcing of services to the heart of a cluster. The creation of clusters is provided in the pharmacy sphere and in the the production of flax. Questions of outsourcing are affected by government programmes more indirectly than directly and only in some respects, but not in a general way. 4 Are there in your jurisdiction any fiscal or customs incentives, development grants or other government incentives to promote outsourcing operations within your jurisdiction?

Fiscal incentives only exist for one kind of service, namely, transport services in the case of their export (paragraph 1. 1. 1. of article 102 of the Tax Code of the Republic of Belarus (the Tax Code)). Therefore, if transport services are exported, the VAT rate is fixed at zero per cent. A number of fiscal and customs incentives (including exemption of the payment of income tax, real estate tax, among others) also exist on the basis of the Decree of the President of the Republic of Belarus No. 6 dated 7 May 2012 on the Promotion of Entrepreneur Activities in the Middle, Small Towns and Rural Areas (Decree No. 6), though they are mostly dedicated to the development of rural areas and small towns and are intended to make business in such areas more attractive rather than developing the outsourcing of services. For other kinds of outsourcing, besides transport outsourcing, there are no fiscal or customs incentives established by the national legislation. Legislation and regulation 5 Is outsourcing as a commercial or operational concept specifically recognised and provided for in your legal system? How?

As was mentioned in question 3, the term ‘outsourcing’ is not recognised by the Belarusian legislation and exists only in business usage. Therefore, almost all types of outsourcing are not recognised by the legislation. Sole accounting outsourcing is mentioned in the Law of the Republic of Belarus dated 18 October 1994 on Accounting and Reporting: the head of an organisation depending on accounting works is entitled to transfer the maintenance of accounting records on the basis of a contract to an organisation that provides services for accounting and reporting or to an accountant who is an individual entrepreneur (part 4 of article 6). The provision of accounting outsourcing is based on the agreement of value provision of services, described in chapter 39 of the Civil Code. Other types of outsourcing, including IT outsourcing, are not mentioned in the current legislation. Nevertheless, they appear on the basis of provisions of the Civil Code (chapter 39, Value Provision of Services, mentioned above). They appear, not because of a direct indication of the law, but because of the demand for such services.

13 © Law Business Research Ltd 2013

belarus Stepanovski, Papakul & partners Thus, almost no special regulation applicable to outsourcing can be found in Belarusian legislation. Nevertheless, the provisions of value provision of services (chapter 39 of the Civil Code) are applicable to outsourcing. 6 Is there any legislation or regulation that directly prohibits, restricts or otherwise governs outsourcing, whether in (onshore) or outside (offshore) your jurisdiction?

As there is no special regulation for provision of outsourcing, there are no special restrictions or prohibitions established by the national legislation. On the other hand, government organisations rarely resort to using outsourcing, despite the absence of such a prohibition. Although there is no restriction for the government organisation itself, the restriction for its employers exists. So, a public official is not entitled to engage in entrepreneurial activities, which means that he or she cannot perform outsourcing (paragraph 11 of article 22 of the Law of the Republic of Belarus dated 14 June 2003 on Public Service in the Republic of Belarus). 7 What are the consequences for breach of the laws directly restricting outsourcing?

As there are no such laws that directly restrict outsourcing, no consequences for their breach exist. However, if a public official performs outsourcing it can be regarded as illegal entrepreneurial activity, which entails responsibility under part 3 of article 12.7 of the Code of the Republic of Belarus of Administrative Offences for which a fine of between 1.3 million and 3.9 million Belarusian rubles is established. 8 Describe any sector-specific legislation or regulation that applies to outsourcing operations.

As mentioned above, no special rules dedicated specially to outsourcing in particular sectors are established by the Belarusian legislation. Nevertheless, some special aspects in regard to offshore outsourcing can be mentioned. They are stipulated in the provisions of the Edict of the President of the Republic of Belarus dated 27 March 2008 No. 178, on the Order of Carrying and Control of Foreign Trade Operations (Edict No. 178). According to its provisions, each stage of services provision within the framework of offshore outsourcing is regarded as a foreign trade operation, thus the agreement that provides offshore outsourcing is a foreign trade agreement. But contrary to the import and export of goods, if in the agreement the import and export of services is provided there is no need to register such an agreement with one of the Belarusian banks (in which the importer or exporter has a bank account). Thus, the main feature in accordance with Edict No. 178 is the established term in which each foreign trade operation has to be completed, which is no later than 90 calendar days after the day of provision of services (if the services are exported) and no later than 60 calendar days after the day of provision of services (if they are imported). The date of completion of foreign trade operation is the day of receipt of the payment under the concluded foreign trade agreement. This term can be prolonged by the National Bank of the Republic of Belarus at the request of a resident of the Republic of Belarus. 9 How does competition regulation apply to outsourcing contracts or structures?

At present, competition regulation as well as the regulation of outsourcing is in an embryonic state in Belarus. Thus, there are no special provisions according to which the duration of outsourcing contracts is restricted. Any contract can be concluded in the period established beforehand (terminal contract), or sine die (indefinite contract).

The parties are free to establish the duration of the contract and the conditions of its prolongation. The restriction of terms prescribed above (according to the provisions of Edict No. 178) does not concern resistance to competition development but concerns the receipt of the foreign currency earnings on schedule. 10 Are there any draft laws or legislative initiatives specific to outsourcing that are being developed or are contemplated?

At this time, no such draft laws or initiatives have been noticed. Contractual considerations 11 What are the typical corporate or quasi-corporate structures or vehicles used to create outsourcing arrangements?

As was described in question 3 the creation of a cluster is provided, which can be regarded as a type of hybrid structure. But the most typical corporate vehicle used to create outsourcing arrangements are ‘virtual captives’, which are part of the supplier operations: staff and premises that are dedicated to a particular outsourcing customer, where the employees are employed by the supplier and the premises owned by the supplier. So, under the outsourcing agreement, some of the supplier’s employees, who have the required skills and experience, perform the services at the customer’s request. 12 What forms of outsourcing contract are usually adopted in your jurisdiction?

The most typical form of contract, which is usually adopted in Belarus, is a straightforward outsourcing contract. It is the most frequently used form. Nevertheless, master services agreements plus call-off contracts (statements of work, work orders, etc) can also be used, especially if the transaction of a tender preceded the conclusion of a contract. 13 Outline the contractual approaches that are adopted in your jurisdiction to address regulations affecting outsourcing.

As an outsourcing contract, according to Belarusian legal doctrine, is regarded as a commercial contract, it can be concluded only between parties that are involved in commercial activities, namely, legal entities and individual entrepreneurs. It means that such a contract must be concluded in written form. The essential term of such contract is its subject (according to which the certain type of services can be specified) and it is the only essential term. As the provisions that regulate the outsourcing matters are stipulated in chapter 39 of the Civil Code (value provision of services), the outsourcing contract is always a commutative contract. However, the price of the services is not regarded as an essential term as it can be defined according to the paragraph 3 of article 394 of the Civil Code: In cases when in a commutative contract the price is not provided and it cannot be defined from the terms of the contract, the execution of the contract must be paid at a price that is usually charged for similar goods, works or services under comparable circumstances.

Other obligatory requirements to the provisions of outsourcing contracts are not established. Thus, if an outsourcing contract does not contain the necessary essential terms it can be regarded as not concluded. But if the required terms are provided, all the other terms are at the parties’ own discretion.

Getting the Deal Through – Outsourcing 2014 © Law Business Research Ltd 2013

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belarus

Data protection

Labour and employment

14 Identify the principal data protection legislation applicable to outsourcing operations.

16 What is the relevant labour and employment legislation for outsourcing transactions?

The principal data protection legislation applicable to outsourcing operations is based on the provisions of the Civil Code (articles 140 and 680), the Law of the Republic of Belarus dated 5 January 2013 on Commercial Secrets (Law on Commercial Secrets) and the Law of the Republic of Belarus dated 10 November 2008 on Information, Informatisation and Data Protection (Law on Information).

All labour and employment legislation is, in general, concentrated in the Labour Code of the Republic of Belarus (the Labour Code). According to article 36 of the Labour Code, if an organisation transfers from the subordination of one body to subordination of another, it does not terminate the labour contract. The only exclusion is if the property owner in the organisation is changed, the new owner is entitled to terminate the labour contract with the head of the organisation, its deputies and the chief accountant no later than within three months from the date of the new owner’s property right. If the property owner in the organisation changes and restructuring of the organisation is provided, labour relations with the employee are continued with its consent under the conditions of the labour contract concluded previously. Thus, in the event of changes to an organisation, labour relations with its employees are, as a rule, preserved.

15 How do rules on the ownership, location, processing and distribution of data apply to outsourcing in your jurisdiction?

According to article 737 of the Civil Code, general provisions of work and labour contract are applicable to the contracts that provide value provision of services if they do not conflict with the regulation of value services provision. In accordance with article 680 of the Civil Code, if a party, during the performance of its obligations under the work and labour contract, has received information about new solutions and technical knowledge, including information that is not under legal protection and also information that can be regarded as a commercial secret from the other party, it has no right to disclose such information to third parties without the consent of the other party. To be regarded as a commercial secret, the information has to be unknown to the third parties, to have commercial value due to its unknown character and not to be relative to state secrets. It also cannot be the object of exclusive rights on intellectual property. The owner of the information has a right to establish the regime of commercial secrets to it. The regime of commercial secrets is considered as established when the scope of information that will be protected as the commercial secrets and relevant measures are defined. Government bodies can receive access to commercial secrets, for example, during conducted inspections, but their representatives are obliged to observe the regime of commercial secrets and are not entitled to disclose them. Legal responsibility is established for the disclosure of information that comprises commercial secrets (from civil to criminal responsibility). The measures of commercial secrets protection are established in article 8 of the Law on Commercial Secrets: • restrictions of access to commercial secrets; • a record of persons who have access to commercial secrets; • the conclusion of agreements prohibiting the disclosure of commercial secrets with employees and contracting parties; and • definition of the employees responsible for taking measures to ensure the confidentiality of commercial secrets. At the same time the owner of the information is entitled to apply technical means and methods that are not prohibited by the legislation. However, there are no special requirements or standards in respect of those measures. The processing and movement of certain kinds of data are regulated by legislation in different spheres. For example, the basic provisions on protection of medical data are defined in article 46 of the Law of the Republic of Belarus dated 18 June 1993 on Health-care, according to which the information about patients’ state of health comprises medical secrets and, as a rule, cannot be disclosed to third parties without the consent of the patient. At the same time, there is no special regulation on the protection of personal data. This is only mentioned in article 18 of the Law on Information, where it states that the collection, processing and storage of information about the private life of an individual and his or her personal data, as well as their usage, are carried out with the consent of the individual, unless otherwise stipulated by the legislative acts of the Republic of Belarus. But there is no general legislative definition of what information comprises personal data.

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17 In the context of an outsourcing, how does labour and employment law apply to a change in initial or subsequent service providers, or transfers of undertakings or parts of undertakings?

As the outsourcing contract is regarded as a commercial one, labour and employment law does not unduly affect outsourcing matters. The questions of labour law are internal questions of the services’ supplier. If it is able to provide services of the quality required by the customer, it is not very important who, from the supplier’s employees, will be the services’ performer. According to article 734 of the Civil Code the services’ supplier, as a rule, has to perform the services itself. Nevertheless, if the services are performed by a legal entity it means that any of its employees can be involved and the prescribed requirement will be observed. 18 Are there any requirements to consult or negotiate with organised labour, works councils or employees regarding an outsourcing?

There are no special requirements of that kind. There is such a requirement within labour and employee relations when an individual works under a labour contract. 19 Are there any notification or approval requirements that apply to an outsourcing transaction?

It is up to the parties to decide if there is a need for receipt of an approval (or an application) to start the provision of services. As there are no such requirements in the legislation, they may occur only in accordance with the concluded outsourcing contract. The employee that will perform the services is indicated in the contract itself or in the acceptance certificates. The term of the certificate’s approval is likewise established by the parties. 20 What are the legal implications, including penalties, for noncompliance with the labour and employment rules and procedures?

As an outsourcing contract is a separate type of contract, the main requirement is that it must not contain the terms that are obligatory for the labour contract (eg, terms, according to which periodic payments for a particular individual are provided). Elsewhere, it will be regarded by the government bodies as a labour contract and all requirements applicable to labour and employee contracts will be applicable to such an outsourcing contract. As mentioned above, labour and employee questions are the internal questions of the services’ supplier (where the services are performed by a legal entity), thus all the legal implications concerning labour and employee matters are entrusted to it.

belarus Stepanovski, Papakul & partners 21 What are the key immigration and visa requirements for employees of customers or providers entering your jurisdiction to manage outsourced operations or to receive or provide training?

Foreign citizens (excluding citizens of the Russian Federation) can obtain the right to work in Belarus if they have a valid residence permit. Otherwise, the employer needs to have a permit to hire a foreign labour force in Belarus. However, this is only necessary if the foreign citizens are hired to work under a labour or employee contract. If a foreign citizen (an employee of a customer) intends to visit Belarus on a business or an educational (training) matter he or she must obtain a short-term visa (for a term no longer than 90 calendar days). A visa can be obtained by request of the foreign citizen at the diplomatic missions and consular offices of the Republic of Belarus, located in the applicant’s country. On entering Belarus a foreign national completes a migration card, which together with the document for travel abroad is presented to the representative of a border guard service at the point of crossing the state border. Thus, it can be seen that there are rather stringent legislative requirements to those foreign citizens who intend to work in Belarus. However, it is always possible to obtain a visa if a representative of the customer wants to visit Belarus on a business or an education matter. Taxation 22 Outline the taxation rules that apply to the establishment and operation of outsourcing captives or similar establishments in your jurisdiction.

There are no special taxation rules applicable to organisations that provide outsourcing services. All the taxation rules are stipulated in the Tax Code. Either direct or indirect taxes are levied, for example, income tax and VAT. The commonly used taxation rules are applied to the outsourcing captives: if a subsidiary provides services for its owner organisation it needs to pay all the taxes that are commonly levied. All Belarusian legal entities, permanent foreign representative offices and even foreign organisations (if such organisations carry out activities in the territory of Belarus or have income from sources located in Belarus) bear tax liability. 23 Outline the indirect taxes in your jurisdiction that apply to the import of offshore outsourcing services by companies within your jurisdiction.

Update and trends One of the main hot topics at the moment is in the field of taxation process, although it concerns not only outsourcing activities, but the taxation of entrepreneur activities in general. The rates of VAT are going to be increased from 20 per cent to 22 per cent and the rates of income tax are going to be reduced from 18 per cent to 15 per cent at the same time. Although many outsourcing matters are not directly resolved by the valid legislation, the popularity of outsourcing provided by a professional supplier that specialises in the provision of definite types of services is increasing. Perhaps because of the lack of regulation, outsourcing in Belarus is developing rapidly and has good prospects.

is resolved in accordance with the Agreement on the Principles of the Levying of indirect Taxes for Export and Import of Goods, Performing of Works and Provision of Services in the Customs Union and the relevant protocols that are adopted in the development of the provisions of this agreement. According to the protocol on the levying of indirect taxes for the performing of works and the provision of services in the Customs Union, the levying of indirect taxes for provision of services is carried out in the member state, the territory of which is recognised as the place of realisation of these services. For provision of services, the rates of indirect taxes and the procedure of their collection is determined in accordance with the legislation of the member state where the services are provided. The territory of the Republic of Belarus is recognised as the place of realisation of the services if the taxpayer (payer) purchases consulting services, legal services, accounting, auditing, engineering, advertising, design, marketing services, data processing services, as well as research, development, design and development process works; works and services for the development of the computer programs and databases (software and IT computing products), their adaptation and modification and maintenance of such software and databases; or services for the provision of personnel where the personnel are working in the place of the buyer’s activity. The only indirect tax that is levied in the case of provision of services in the territory of the Republic of Belarus is VAT. The VAT rate for the realisation of the services prescribed is established at 20 per cent in accordance with the Tax Code. The import of offshore outsourcing services to the territory of the Republic of Belarus is, therefore, subject to VAT.

The question of the levying of indirect taxes in the customs territory of the Customs Union (the customs territory of the Republic of Belarus, the Russian Federation and the Republic of Kazakhstan)

Nadya Hadanovich Valentina Ogarkova Sviatlana Valuyeva

n.hadanovich@spplaw.by v.ogarkova@spplaw.by s.valuyeva@spplaw.by

16 Kuibyshev Street, 4th Floor Tel: +375 17 209 44 83 220029 Minsk Fax: +375 17 204 86 72 Belarus www.spplaw.by

Stepanovski, Papakul & partners

belarus

Current issues

25 What are the main challenges facing outsourcing within, from or to your jurisdiction?

24 Identify and give details of any notable cases or administrative or regulatory determinations within the past three years in your jurisdiction that have directly involved outsourcing.

A notable case of regulatory determination that involved legal outsourcing occurred on 30 December 2011 when the Law of the Republic of Belarus on Advocacy and Advocate Activity in the Republic of Belarus (the Law on Advocacy) was adopted. According to its provisions, since April 2012 only advocates are able to represent the interests of individuals and legal entities in all the courts of Belarus. Before the Law on Advocacy entered into force, attorneys were empowered to represent the interests of legal entities in the commercial courts of Belarus. Thus, before April 2012, attorneys could provide the same range of legal services as advocates for legal entities, including the representation of their interests in Belarusian commercial courts. Because of such legislative changes, all legal firms are now interested in creating an advocate bureau within their structure to provide their clients with the same range of legal services as before (the possibility of creating private advocate bureaus is prescribed in the Law on Advocacy). Therefore, at the moment there is an increasing number of advocates in Belarus.

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The restriction in the importing of services may be defined as the main challenge. Almost all the government programmes provide for an increase in exporting and a limitation to importing in many spheres and the outsourcing sphere is affected by this. For example, the residents of a high-tech park have been recently provided with rented housing, which is aimed at restricting the outflow of IT specialists from Belarus as well as restricting the recourse to the importation of offshore IT outsourcing. At the same time, these measures can be regarded as positive, because they allow the development of the export of offshore IT outsourcing and are ensuring the development of onshore IT outsourcing. Unequal conditions for entrepreneurial activity in the cities and the rural areas has been created (due to the provisions of Decree No. 6), therefore, if an outsourcing supplier is located in a rural area, it will be exempt from the payment of a number of taxes, for example, from the payment of income tax, although it performs the same services as the outsourcing supplier located in the city. As such measures are aimed at developing the self-provision of services in rural areas and this may result in the restriction of recourse to outsourcing suppliers in such areas.

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