“Ease of Doing Business” pushed to lift PH from low ASEAN ranking

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“Ease of Doing Business” pushed to lift PH from low ASEAN ranking

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The difficulty in obtaining business permits and licenses required in setting up businesses coupled with the short validity period add burden to the business community.

Third District Rep. Arthur Yap pointed this out as he cited that at present, it takes 16 procedures to navigate and an average of 29 days to start a business in the Philippines.

To address this, Yap filed House Bill 5093 which aims to increase participation and promote the growth of business, especially MSMEs, by providing for the automatic approval and release of business permits upon the lapse of 30 days of inaction, provided that all necessary documents have been submitted.

The validity period of the said permits should also be valid for a period of one year from the date of issuance instead of the current practice of setting the expiration at the end of the fiscal year the said permit was filed.

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“Reducing barriers to business formalization can stimulate enterprise growth and create decent work opportunities. A bigger formal economy would mean a higher tax base thereby potentially increasing revenues for the government,” according to Yap.

He further explained that “formalization translates to higher quality, better pay and sustainable employment as well as improve access to formal markets and more productive resources such as capital and land”.

“The measure of a transparent government is the case by which citizens get services from the government, especially with documents that must be paid for,” Yap added.

He said HB 5093 also seeks to establish the Ease of Doing Business Commission which shall be the overall policy-making body on business registration and regulatory management, and shall set the overall direction for the implementation of the National Policy on Ease of Doing Business.

 This is in consonance with the 10-point Socio-Economic Program of President Rodrigo Duterte where one of the intentions is improving the ease of doing business through more efficient and responsive governance.

Yap cited that compared to “our other ASEAN neighbors in the ‘Ease of Doing a Business’ ranking, the Philippines has performed poorly.

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“As of June 2016, Philippines ranked 24th out of 26 countries in East Asia and Pacific in the “Starting a Business” category, while ranking 15th out of 26 countries (when averaged with the “Dealing with Construction Permits” category),” Yap cited.

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He saud the low ranking not only reflects the possibility of lower foreign direct investments but also as a barrier to local micro, small and medium enterprises (MSMEs) growth and development.

In the HB 5093, Yap proposed that legislation of the “Ease of Doing Business Act of 2017” under which, the State shall recognize the indispensable role of the private sector, encourage private enterprise, and provide incentives to needed investments.

With this proposed policy, the State shall provide a business environment that is conducive to the establishment and operation of businesses in the country; simplify business permit and licensing system procedures and streamline the requirements at the national and local levels; and promote transparency in government with regard to business registrations and other manner of transacting with the public to reduce red tape and expedite permitting, lincensing and other similar transactions in government.

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The bill includes a proposed provision on requirements for license, clearance and/or permit   application.

This shall provide that all national government agencies and local government units issuing licenses, clearances and/or permit to business entities shall post a comprehensive checklist of requirements for every type of license, clearance and/or permit being issued.

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There shall be a uniform checklist of requirements required by licensing and permitting offices issuing a similar license, clearance and/or permit to be established when applicable.

The checklist requirements, step-by-step procedure and schedule of fees for the issuance of a license, clearance and/or permit shall be conspicuously posted in the premises of national and local government licensing and permitting agencies and in Business One-Stop Shop or in areas designated by cities or municipalities.

The same information shall likewise be posted online in the official website of national government agencies and LGUs and shall be linked to the Central Business Portal.

It is also proposed that business entities shall be limited to submitting only the requirements provided in the checklist in the processing of an application.

In cases where additional documents are required, the business licensing and/or permitting office shall notify the applicant of the reasons he must comply with the submission of such documents.

HB 5093 also proposed a provision for computerized or software-enabled business permit and licensing system where cities or municipalities shall, as far as practicable, automate their business permitting and licensing system (BPLS) or set up an electronic-Business One Stop Shop (BOSS) within a period of one year upon the effectivity of the proposed law for a more efficient business registration.

Municipalities and cities without electronic mechanism for submission and processing of permit, license and clearance applications shall set up a BOSS; and that there shall be a queuing mechanism in the BOSS to better manage flow of applications among the LGUs’ departments receiving and processing applications, including the Bureau of Fire Protection (BFP).

Issuance of fire safety clearance shall also be in no case longer than 30 days.

For new business permit application, the Fire Safety Inspection Certificate (FSIC) already issued during the occupancy permit stage shall be deemed sufficient as basis for the issuance of the FSIC for a business entity as a requirement for the business permit.

For renewal of business permit, the BFP shall present the FSIC to the city or municipality, either through the copy of the FSIC or the negative/positive list.

This is provided that the business entity shall inform the BFP and submit the necessary documentary requirements if renovations, modifications or any form of alterations are made to the original building structure 30 days before the expiration of the business permit.

If the BFP fails to furnish the city or municipality with the FSIC or inform the same through the negative/positive list, the business entity shall be deemed to have a valid FSIC and therefore, the basis for the renewal of the business permit.

The BFP or any of its officials or employees shall also be prohibited from selling, offering to sell or recommending specific brands of fire extinguishers and other fire safety equipment.

The BFP shall also co-locate with the BOSS or in an appropriate area designated by the city or municipality within its premises to assess and collect the fire safety inspection fees.

The BFP may also enter into agreements with cities or municipalities allowing the latter to be deputized as assessors and/or collecting agents for the fire safety inspection fees.

The BFP may develop and adopt an online or electronic mechanism in assessing fees, collecting or accepting payments and sharing or exchange of other relevant data on business permit processing.

These proposed provisions affecting the BFP will in effect amend pertinent provisions of Republic Act 9514 or the Revised Fire Code of the Philippiens of 2008.

The Department of Information, Communications and Technology (DICT) shall also establish- -through government infrastructure- -a cloud-native Central Business Portal or other similar technology as the DICT may prescribe which shall serve as a central system to receive application and capture application data from business entities.

 

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