Common
problems businesses face when it comes to dealing with government agencies are the long lines and slow
processing times due to red tape. These factors are what usually discourage foreign businesses from investing in
the Philippines.
To target
these problems, the administration has put the Ease of Doing Business and Efficient Government Service Delivery
Act or Republic Act No. 11032 into effect on May 28, 2018.
What is the “East of Doing Business
Act”?
The Ease
of Doing Business Act is a revision of the 2007 Anti-Red Tape Act. It was made to ease the process of starting
and running a business It aims to solve the “perennial problem of bureaucratic red tape”.
RA 11032
was made to “promote the integrity, accountability, and proper management of public affairs and public
property”. With the growing number of complaints regarding developing systems and procedures, this bill intends
to decrease waiting time, improve services, and prevent graft and corruption.
For
foreign investors, this Act will provide them with a better and more supportive environment for their
businesses. The passing of the RA 11032 into law comes right after the Philippines’ ranking went down in the
World Competitiveness Yearbook.
How does this law affect businesses?
There is
nothing but good news for those doing business in the Philippines in the light of this new law. Here are some of
its key features that will definitely create a better environment for all types of businesses:
- Unified business application and centralized facilitation
This
includes clearances, permits, and other local requirements. Government agencies will also be required to set up
a “one-stop shop” for all businesses transactions. All business permit and licensing offices need to be in a
single facility for quicker and more convenient processing.
- Zero-contact policy
The
zero-contact policy is there to lessen opportunities for corruption. It states that no government employee or
officer should contact any applicant in relation to their application unless absolutely necessary.
- Shortened processing time
Businesses
will have an easier time making transactions with government agencies and institutions because under RA 11032,
processing time for applications will be shortened. Simple transactions will be processed within three working
days while it will be seven working days for more complicated transactions, and 20 working days for very
technical transactions.
If the
transaction is delayed, government agencies are required to provide a written notice indicating the reason for
the extended deadline.
- Automatic approval of new application and automatic extension of licenses
If an
agency fails to meet the processing deadlines of renewals or applications for licenses, clearances,
authorizations, certifications, and the like, the application or renewal will be deemed approved, as long as the
applicant has passed all the proper requirements.
- Central business portal
Local
government institutions are tasked to computerize the systems they use when processing permits. They should have
these features set up within three years of the law’s enactment.
Need more
advice on starting and managing a business in the Philippines? Get in touch with FilePino today by calling
today at +63.917.892.2337 (Philippines). You can also browse our Philippine Business
Blog for more helpful
articles.
