Discover everything you need to know about Macedonia
Here ares some key facts regarding hiring in Macedonia
North Macedonia, a landlocked country in the south-central Balkans of Southeastern Europe, is bordered by Serbia, Kosovo, Bulgaria, Greece, and Albania. It features a mountainous terrain with significant ranges like the Šar and Rhodope Mountains, interspersed with valleys such as the fertile Pelagonia Valley. Lake Ohrid and the Vardar River are notable geographical features. The climate varies from Mediterranean influences to colder continental conditions in the mountains.
Historically, the region was part of ancient kingdoms like Paeonia and Macedonia, the latter becoming prominent under Phillip II and Alexander the Great. It fell under Roman, Byzantine, and later Ottoman rule, which left a lasting cultural impact. Post-Balkan Wars and World War I, it became part of Yugoslavia, gaining independence in 1991 and renaming itself the Republic of North Macedonia in 2019 after resolving a naming dispute with Greece.
The economy is developing, focusing on services, industry, and agriculture. Ethnic Macedonians form the majority, with significant minorities including Albanians. The country has a high literacy rate and values education, with several universities. Cultural heritage is rich, influenced by its diverse historical rulers and local traditions. Challenges include emigration of skilled youth and a gender gap in the workforce. The service sector dominates employment, with industry and agriculture also playing significant roles. Professional communication balances formality with the importance of building rapport, and organizational structures often reflect respect for hierarchy.
North Macedonia is exploring renewable energy and expanding its online marketplace, with potential growth in e-commerce, digital marketing, and sustainable development initiatives. These sectors are poised to create new job opportunities and contribute to economic diversification.
Understand what the employment costs are that you have to consider when hiring Macedonia
Rivermate is a global Employer of Record company that helps you hire employees in Macedonia without the need to set up a legal entity. We act as the Employer of Record for your employees in Macedonia, taking care of all the legal and compliance aspects of employment, so you can focus on growing your business.
When you hire employees in Macedonia through Rivermate, we become the legal employer of your staff. This means that we take on all the responsibilities of an employer, while you retain the day-to-day management of your employees.
You as the company maintain the direct relationship with the employee, you allocate them the work and manage their performance.
Rivermate takes care of the local payrolling of the employee, the contracts, HR, benefits, and compliance.
As an Employer of Record in Macedonia, Rivermate is responsible for:
As the company that hires the employee through the Employer of Record, you are responsible for:
Social Security Contributions in North Macedonia:
Payroll Responsibilities:
Personal Income Tax (PIT):
VAT System:
Corporate Tax and Incentives:
Recommendation:
Employee Benefits in North Macedonia
Paid Time Off: Employees are entitled to 20-26 working days of paid annual vacation, with part-time employees receiving a minimum of 10 days. Paid leave is also available on national holidays and for short-term illnesses, with compensation ranging from 70% to 90% of the salary based on the duration of the illness. Maternity and paternity leaves are also provided.
Social Security Contributions: Employers and employees contribute to pension and disability insurance, with an employer rate of 18.8%. Health insurance contributions include 7.5% from employers and 0.5% from employees. Employment insurance contributions from employers stand at 1.2%.
Financial and Educational Support: Some employers offer financial assistance for further education and professional development, along with additional insurance for managerial staff.
Health and Wellness Benefits: Beyond the public health system, private health insurance plans are available, offering extended coverage and benefits.
Work-Life Balance Benefits: Companies may support flexible work arrangements like remote work or compressed workweeks to enhance work-life balance.
Mandatory Health Insurance: The public system covers various medical services, with some co-payments required. Employers may supplement this with private health insurance plans for better coverage and reduced wait times.
Retirement Plans: The Mandatory State Pension Scheme requires contributions from both employers and employees, operating on a pay-as-you-go basis. Voluntary Private Pension Plans are also available, offering potentially higher returns and more control over investments.
North Macedonia Labor Law Overview
Termination Reasons: Employers in North Macedonia can terminate employment for economic, technological, structural reasons, employee incapability, breach of contract, or legal grounds such as cessation of employer's activities.
Severance Pay: Mandated in cases like economic dismissal or termination of a pregnant employee, calculated based on the employee's average salary and length of service.
Notice Requirements: Employers must provide a minimum of one month's notice, with extended periods for large-scale layoffs. Employees are also required to give one month's notice.
Procedural Requirements: Termination must be communicated in writing with a stated reason, and employees can challenge unfair dismissals legally.
Discrimination Laws: The Law on Prevention of and Protection against Discrimination (2020) prohibits discrimination on various grounds and establishes mechanisms like the Commission for Protection against Discrimination and civil courts for redress.
Employer Responsibilities: Includes developing non-discrimination policies, providing training, establishing complaint procedures, and accommodating employees based on protected characteristics.
Work Hours and Rest: A maximum 40-hour workweek with provisions for overtime pay and rest periods, including a minimum of 20 working days of annual leave.
Ergonomic and Safety Requirements: Employers must ensure a safe work environment, conduct risk assessments, and provide necessary training and equipment to minimize health and safety risks.
Employee Rights: Include the right to a safe workplace, information and training on safety, the right to refuse unsafe work, and the right to report violations without retaliation.
Enforcement: The State Labour Inspectorate enforces health and safety regulations, conducts inspections, and can issue fines for non-compliance.
This summary provides a broad understanding of labor laws in North Macedonia, emphasizing termination, discrimination, workplace safety, and employee rights.
In North Macedonia, employment relationships are primarily regulated through Employment Contracts and Author's Contracts.
Employment Contracts are formal agreements that define the rights and duties of both parties. They come in two forms:
Author's Contracts are used for the creation of literary, scientific, or artistic works, with terms varying by the nature of the commissioned work.
Collective Bargaining Agreements (CBA) also influence employment terms, setting general conditions like wages and working hours for all covered employees.
Key clauses in employment agreements include:
Probationary Periods are recognized, with a maximum duration of four months, allowing both parties to assess suitability. Termination during this period requires minimal notice.
Confidentiality and Non-Compete Clauses protect business interests:
Remote Work in North Macedonia: North Macedonia allows employers and employees to agree on remote work arrangements through employment contracts or addenda, which must be filed with labor authorities within three days. There is no specific legislation for remote work, but existing labor laws covering work hours, breaks, and employee rights apply.
Technological and Infrastructure Requirements: Employers must provide secure communication tools, data security measures, and necessary equipment like laptops and software licenses. A stable internet connection is crucial, and employers may set connectivity standards in the remote work agreement.
Employer Responsibilities: Employers should clearly communicate remote work expectations and provide adequate training on communication tools and data security. They should also support remote employees in maintaining ergonomic workstations and promote healthy work habits to prevent isolation and health issues.
Flexible Work Options: Besides remote work, North Macedonia offers part-time work, flexitime, and job sharing, with terms typically agreed upon between employer and employee. The legal framework supports flexible work arrangements, influenced by the EU's GDPR.
Data Protection and Privacy: Employers must comply with the Macedonian Law on Personal Data Protection, ensuring informed consent for data processing, implementing security measures, and being transparent about data use. Employees have rights to access, rectify, or erase their personal data.
Best Practices for Data Security: Employers should enforce data security policies, use strong authentication methods, encrypt sensitive data, and train employees on data protection best practices. If transferring data outside Macedonia, employers must ensure adequate data protection levels in the recipient country.
Additional Considerations: Employers should have policies for the use of personal devices for work, including data storage restrictions and encryption requirements.
North Macedonia maintains a standard 40-hour workweek, divided into five eight-hour days, as stipulated by its Labor Law. Overtime is capped at eight hours weekly and 190 hours annually, with compensation ranging from 135% to 150% of the regular wage. Exceptions allow for additional overtime in urgent situations or specific job roles, particularly in the Ministry of Internal Affairs and the National Safety Agency.
Employees are entitled to a minimum of 12 hours of rest between workdays and a 24-hour rest period weekly, typically on Sundays. Workdays exceeding six hours require a break of at least 30 minutes, which cannot be scheduled at the beginning or end of the shift.
Night shift workers receive a 35% wage increase and must have health checks and food expenses covered by employers. Weekend workers earn a 50% increase in their hourly wage, although specific agreements may vary this rate.
Understanding market competitive salaries in North Macedonia is essential for maintaining fairness, attracting skilled workers, and enhancing employee satisfaction and motivation. Competitive salaries align with industry and regional standards, and can be researched through salary surveys, job boards, and comparison websites. The minimum wage in North Macedonia, reviewed annually, is currently MKD 20,175.00 per month as of March 2023. Employers must comply with this regulation or face penalties.
Employers in North Macedonia are also required to provide mandatory benefits such as retirement contributions, public healthcare, and paid leave, including annual, public holidays, sick, and parental leave. Performance-based bonuses and a 13th-month salary are common practices, incentivizing employees based on their work performance and attendance. Additionally, companies may offer supplemental benefits like extended health insurance and educational financial assistance to stand out as attractive employers. Employees are typically paid monthly, with social security contributions deducted by the employer.
In North Macedonia, the Labor Law regulates notice periods and severance pay during employment termination, with different stipulations based on the initiator of the termination and the type of employment contract.
Severance pay is mandatory for terminations due to business reasons and is calculated based on the employee's tenure and average monthly salary over the last six months. The severance amount ranges from one to seven net salaries, depending on the length of service, with a minimum amount set at 50% of the average net salary in North Macedonia.
Termination must be formally communicated in writing, detailing the reason, justification, and legal remedies available to the employee. Consultation with a Workers' Council is required under certain conditions, and the termination notice must be delivered personally.
North Macedonia's economy provides ample opportunities for both traditional employees and independent contractors, but distinguishing between the two is essential to avoid legal and financial issues. Employees are under direct employer control and receive benefits, while contractors work autonomously, often on multiple projects, and handle their own tools and benefits. Misclassification can lead to backdated payments and fines.
For contractors, clear contract terms, including scope of work, payment details, and termination conditions, are crucial. Contracts should be in Macedonian to be legally valid. Successful negotiation involves understanding market rates, defining scope and payment terms clearly, and maintaining professionalism.
Key industries for contractors include IT, marketing, translation, and construction. Protecting intellectual property is vital, with copyright typically belonging to the creator unless specified otherwise in a contract. Registration and clear records can help safeguard these rights.
Freelancers must navigate tax obligations and may benefit from securing insurance like health, accident, or professional liability insurance to mitigate potential risks.
Constitutional and Legislative Framework: North Macedonia's Constitution guarantees the right to safety and health at work, supported by the Law on Occupational Safety and Health and the Law on Health Protection. These laws outline the responsibilities of employers and employees and include risk assessment, safety measures, and enforcement mechanisms.
Employer Responsibilities: Employers are mandated to perform risk assessments, implement safety measures based on these assessments, provide personal protective equipment (PPE), and ensure training and maintenance of equipment. They must also educate workers about hazards, establish accident reporting procedures, and facilitate medical examinations.
Employee Rights and Responsibilities: Employees have the right to a safe work environment and can refuse work that poses serious risks to their health. They are entitled to receive training and information related to occupational safety and health (OSH) and must participate in safety procedures and use PPE correctly.
Specific Health and Safety Areas: The legislation covers various safety areas including handling hazardous chemicals, noise and vibration control, prevention of musculoskeletal disorders, and addressing workplace stress and harassment. It also includes provisions for emergency preparedness and first aid.
Enforcement: The State Labor Inspectorate is the primary body enforcing OSH laws, with powers to inspect workplaces, issue notices, impose fines, and halt operations in severe cases. The laws aim to align with EU best practices.
Risk Assessment and Control Measures: Employers must conduct comprehensive risk assessments and follow a hierarchy of controls to mitigate risks. This includes specific regulations for handling hazardous substances and protecting against various workplace hazards.
Worker Training and Health Surveillance: Employers are required to provide job-specific safety training and arrange for medical surveillance to monitor the health impacts of workplace exposures.
Emergency Preparedness and Response: Employers must have emergency plans and conduct regular drills to ensure readiness for workplace incidents.
Inspection and Compliance: Inspections are risk-based and focus on compliance with OSH regulations. The frequency of inspections varies based on the risk level and compliance history of the workplace.
Post-Inspection Actions and Accident Investigation: Following inspections, improvement notices may be issued, and non-compliance can lead to fines or operational suspension. Employers must report serious accidents immediately and conduct internal investigations to prevent future incidents.
Compensation and Legal Considerations: Employers must provide workers' compensation insurance, covering medical costs, disability benefits, and compensation for lost wages. Disputes over claims may be resolved legally, and worker representatives are encouraged to participate in accident investigations.
North Macedonia's labor court system comprises three levels: Basic Courts, Appellate Courts, and the Supreme Court, handling a variety of labor disputes including contract interpretations and workplace issues. The process starts with filing a lawsuit at a Basic Court, potentially followed by appeals. Arbitration serves as an alternative dispute resolution method, initiated by mutual agreement and resulting in binding decisions.
Labor standards enforcement involves compliance audits and inspections conducted by the State Labor Inspectorate, focusing on various types of inspections and addressing non-compliance with penalties ranging from warnings to criminal liability. Whistleblower protections exist but are considered fragmented and insufficiently comprehensive.
North Macedonia adheres to several ILO conventions impacting domestic legislation, which aligns with international standards on forced labor, child labor, discrimination, and union rights. However, challenges remain in fully implementing these standards, particularly in enforcement and labor inspection capacities. Efforts to improve include legal reforms, capacity building, and awareness campaigns to enhance compliance and understanding of labor rights.
Understanding these aspects of Macedonian professional culture and holiday observances is crucial for effective business planning and operations in the region.
Frequently Asked Questions for Employer of Record services in Macedonia
Setting up a company in Macedonia involves several steps and can take approximately 1 to 2 weeks, depending on the efficiency of the processes and the completeness of the required documentation. Here is a detailed timeline for setting up a company in Macedonia:
Name Reservation (1-2 days):
Preparation of Incorporation Documents (1-3 days):
Opening a Bank Account (1-2 days):
Registration with the Central Registry (1-2 days):
Obtaining a Company Seal (1 day):
Registering for Tax and Social Security (1-2 days):
Registering Employees (1-2 days):
Overall, the timeline for setting up a company in Macedonia is approximately 1 to 2 weeks, assuming all documentation is in order and there are no delays in the process. Using an Employer of Record (EOR) service like Rivermate can significantly streamline this process, as they handle all administrative and compliance-related tasks, allowing you to focus on your core business activities.
When using an Employer of Record (EOR) in Macedonia, the EOR handles the filing and payment of employees' taxes and social insurance contributions. This includes the calculation, withholding, and remittance of income taxes, as well as contributions to social security, health insurance, and other mandatory benefits as required by Macedonian law. The EOR ensures compliance with local regulations, thereby relieving the client company of the administrative burden and complexities associated with payroll and tax compliance in Macedonia.
Yes, it is possible to hire independent contractors in Macedonia. However, there are several important considerations to keep in mind when doing so.
Legal Framework: Independent contractors in Macedonia are governed by the Law on Obligations, which outlines the general principles of contract law. Unlike employees, independent contractors are not covered by the Labor Law, which means they do not receive the same protections and benefits, such as paid leave, social security contributions, and severance pay.
Contractual Agreement: It is crucial to have a well-drafted contract that clearly defines the scope of work, payment terms, duration, and other relevant conditions. This contract should explicitly state that the relationship is that of an independent contractor to avoid any misclassification issues.
Taxation: Independent contractors are responsible for their own tax filings and social security contributions. They must register with the Public Revenue Office and obtain a tax identification number. Contractors are required to pay personal income tax on their earnings, which is generally a flat rate of 10%.
Compliance and Misclassification Risks: One of the significant risks of hiring independent contractors is the potential for misclassification. If the relationship between the company and the contractor resembles that of an employer-employee relationship, Macedonian authorities may reclassify the contractor as an employee. This can result in penalties and the obligation to provide back pay for benefits and social security contributions.
Benefits of Using an Employer of Record (EOR): To mitigate the risks and complexities associated with hiring independent contractors, many companies opt to use an Employer of Record (EOR) service like Rivermate. An EOR can handle all aspects of employment, including compliance with local labor laws, tax filings, and social security contributions. This ensures that the company remains compliant with Macedonian regulations and reduces the administrative burden.
In summary, while it is possible to hire independent contractors in Macedonia, it is essential to navigate the legal and regulatory landscape carefully. Using an EOR service can provide peace of mind and ensure compliance, allowing companies to focus on their core business activities.
In Macedonia, employers have several options for hiring workers, each with its own set of legal and administrative requirements. Here are the primary methods:
Direct Employment:
Temporary Employment Agencies:
Freelancers and Independent Contractors:
Employer of Record (EOR) Services:
Benefits of Using an Employer of Record (EOR) in Macedonia:
Compliance with Local Laws:
Cost-Effective:
Administrative Relief:
Flexibility:
Local Expertise:
Risk Mitigation:
In summary, while there are several options for hiring workers in Macedonia, using an Employer of Record like Rivermate offers significant advantages in terms of compliance, cost savings, administrative efficiency, and flexibility. This makes it an attractive option for companies looking to expand their operations in Macedonia without the complexities of establishing a local entity.
Yes, employees in Macedonia receive all their rights and benefits when employed through an Employer of Record (EOR) like Rivermate. An EOR ensures compliance with local labor laws and regulations, which is crucial for protecting employee rights and providing the necessary benefits. Here are some key aspects of how an EOR like Rivermate ensures that employees in Macedonia receive their rights and benefits:
Compliance with Labor Laws: An EOR is well-versed in Macedonian labor laws and ensures that all employment contracts and practices comply with these regulations. This includes adherence to minimum wage laws, working hours, overtime pay, and other statutory requirements.
Social Security and Taxes: The EOR handles the calculation and remittance of social security contributions and taxes on behalf of the employees. This ensures that employees are covered under the national social security system, which includes health insurance, pension contributions, and unemployment benefits.
Employment Contracts: The EOR provides legally compliant employment contracts that outline the terms and conditions of employment, including job responsibilities, salary, benefits, and termination conditions. This transparency helps protect employee rights.
Paid Leave and Holidays: Employees are entitled to paid leave and public holidays as per Macedonian labor laws. An EOR ensures that employees receive their entitled annual leave, sick leave, maternity/paternity leave, and other statutory holidays.
Health and Safety: An EOR ensures that the workplace complies with health and safety regulations, providing a safe working environment for employees. This includes regular safety checks and adherence to occupational health standards.
Employee Benefits: In addition to statutory benefits, an EOR may offer additional benefits such as private health insurance, retirement plans, and other perks that enhance employee satisfaction and well-being.
Dispute Resolution: An EOR provides support in resolving any employment-related disputes, ensuring that employees have access to fair and legal recourse in case of grievances.
By partnering with an EOR like Rivermate, companies can ensure that their employees in Macedonia receive all their legal rights and benefits, fostering a compliant and supportive work environment.
HR compliance in Macedonia refers to the adherence to the country's labor laws, regulations, and standards that govern employment practices. This includes a wide range of legal requirements such as employment contracts, working hours, wages, social security contributions, health and safety regulations, anti-discrimination laws, and termination procedures. Ensuring HR compliance is crucial for several reasons:
Legal Protection: Compliance with Macedonian labor laws protects companies from legal disputes and potential lawsuits. Non-compliance can result in significant fines, penalties, and legal actions that can be costly and damaging to a company's reputation.
Employee Rights: Adhering to HR compliance ensures that employees' rights are protected. This includes fair wages, safe working conditions, and protection against unfair dismissal or discrimination. Respecting these rights helps in building a positive work environment and enhances employee satisfaction and retention.
Operational Efficiency: By following established HR regulations, companies can streamline their HR processes and avoid the complexities and uncertainties associated with non-compliance. This leads to more efficient and predictable business operations.
Reputation Management: Companies that are known to comply with local labor laws and treat their employees fairly are more likely to attract top talent and maintain a positive public image. This can be a significant competitive advantage in the market.
Risk Mitigation: Compliance helps in identifying and mitigating risks associated with employment practices. This includes avoiding issues related to wrongful termination, workplace safety violations, and other legal infractions that could disrupt business operations.
Cultural Adaptation: Understanding and complying with local HR laws and practices helps multinational companies adapt to the cultural and legal environment of Macedonia. This is particularly important for companies looking to establish a long-term presence in the country.
Using an Employer of Record (EOR) service like Rivermate can greatly simplify the process of achieving HR compliance in Macedonia. An EOR takes on the responsibility of ensuring that all employment practices adhere to local laws and regulations. This includes managing payroll, benefits, taxes, and other HR functions, allowing companies to focus on their core business activities without worrying about compliance issues. Rivermate's expertise in Macedonian labor laws ensures that companies can operate smoothly and legally, minimizing risks and enhancing operational efficiency.
Employing someone in Macedonia involves several costs that employers need to consider. These costs can be broadly categorized into direct compensation, social security contributions, and other statutory benefits. Here’s a detailed breakdown:
Gross Salary: This is the primary cost and includes the base salary agreed upon with the employee. The gross salary is subject to various deductions and contributions.
Social Security Contributions: Employers in Macedonia are required to contribute to social security on behalf of their employees. These contributions include:
Personal Income Tax: While this is deducted from the employee’s salary, it’s important for employers to be aware of it. The personal income tax rate in Macedonia is a flat rate of 10%.
Other Statutory Benefits:
Severance Pay: In case of termination, employers may be required to pay severance, depending on the circumstances and the length of service of the employee.
Other Costs:
Using an Employer of Record (EOR) like Rivermate can help manage these costs effectively. An EOR handles payroll, tax compliance, and benefits administration, ensuring that all statutory obligations are met. This can save time and reduce the risk of non-compliance, which can be costly in terms of fines and legal issues. Additionally, an EOR can provide insights into local labor laws and market conditions, helping employers make informed decisions about compensation and benefits.
When a company uses an Employer of Record (EOR) service like Rivermate in Macedonia, several legal responsibilities are effectively managed by the EOR, simplifying the company's obligations. Here are the key legal responsibilities and how they are handled:
Employment Contracts:
Payroll and Tax Compliance:
Employee Benefits:
Labor Law Compliance:
Employee Onboarding and Offboarding:
Work Permits and Visas:
Record Keeping and Reporting:
By using an EOR like Rivermate in Macedonia, companies can significantly reduce their administrative burden and ensure compliance with local laws. The EOR takes on the majority of legal responsibilities related to employment, allowing the company to focus on its core business activities.
Rivermate, as an Employer of Record (EOR) in Macedonia, ensures HR compliance through several key strategies and practices tailored to the local regulatory environment. Here are the detailed ways Rivermate achieves this:
Local Expertise and Knowledge: Rivermate employs local HR professionals who are well-versed in Macedonian labor laws, regulations, and cultural nuances. This local expertise ensures that all employment practices are compliant with the latest legal requirements.
Employment Contracts: Rivermate prepares and manages employment contracts that comply with Macedonian labor laws. These contracts include all mandatory clauses related to working hours, wages, benefits, termination conditions, and other employment terms, ensuring they meet legal standards.
Payroll Management: Rivermate handles payroll processing in accordance with Macedonian regulations. This includes accurate calculation of salaries, tax withholdings, social security contributions, and other statutory deductions. They ensure timely and correct payments to employees and relevant authorities.
Tax Compliance: Rivermate ensures that all tax obligations are met, including income tax, social security contributions, and other mandatory payments. They stay updated with any changes in tax laws and adjust their processes accordingly to maintain compliance.
Employee Benefits Administration: Rivermate manages employee benefits in line with Macedonian laws, including health insurance, pension contributions, and other statutory benefits. They ensure that employees receive all legally required benefits and that these are administered correctly.
Labor Law Adherence: Rivermate ensures compliance with Macedonian labor laws regarding working hours, overtime, leave entitlements (such as annual leave, sick leave, and maternity/paternity leave), and workplace safety regulations. They monitor and implement any changes in labor legislation to remain compliant.
Termination and Severance: Rivermate handles employee terminations in accordance with Macedonian laws, ensuring that all legal procedures are followed, and that employees receive any due severance pay and other entitlements. This minimizes the risk of legal disputes and ensures fair treatment of employees.
Data Protection and Privacy: Rivermate ensures compliance with data protection laws, including the handling of personal employee information. They implement robust data security measures to protect sensitive information and comply with local and international data privacy regulations.
Regular Audits and Compliance Checks: Rivermate conducts regular audits and compliance checks to ensure ongoing adherence to all relevant laws and regulations. This proactive approach helps identify and address any potential compliance issues before they become problematic.
Employee Relations and Dispute Resolution: Rivermate provides support in managing employee relations and resolving disputes in accordance with Macedonian labor laws. They offer guidance on best practices and legal requirements to ensure fair and compliant handling of any workplace issues.
By leveraging these strategies, Rivermate ensures that companies can operate in Macedonia with confidence, knowing that their HR practices are fully compliant with local laws and regulations. This allows businesses to focus on their core operations while minimizing the risk of legal issues and penalties.
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