On May 28, 2018 President Rodrigo Duterte signed into law Republic Act (RA 11032) or the Ease of Doing Business Law. This law aims to entice entrepreneurs to open up their businesses in the Philippines by expediting business and non-business transactions including the issuances of permits and licenses and holding government officials accountable for graft and corruption. This law is an amendment to the Anti Red-Tape Act of 2007.
The following are the salient provisions of the Ease of Doing Business Law.
FASTER TRANSACTIONS DUE TO EASE OF DOING BUSINESS LAW
All applications and requests transactions shall be acted upon by the government or its officer within the following time frames:
- Three (3) working days for simple transactions
- Seven (7) working days for complex transactions
- Twenty (20) working days for applications and requests involving activities which pose danger to public health, public safety, public morals, public policy, and highly technical transactions.
If the local government units, agencies, and Government Owned and Controlled Corporations fails to act on these requests and transactions within the time frame stated in the law, the same shall be automatically approved.
STREAMLINED PROCEDURES FOR THE ISSUANCE OF LOCAL BUSINESS LICENSES, CLEARANCES, PERMITS, CERTIFICATIONS OR AUTHORIZATIONS
One of the main issues why the Ease of Doing Business law was enacted is because of the complaints of entrepreneurs that establishing a local business is very tedious due to the difficulty in applying permits, licenses, clearances et al. RA 11032, in theory, have significantly solved this complaint by streamlining the procedures for the issuances of business permits and other necessary business requirements by implementing the following:
- Coming up with a single or unified business application form which shall be used in processing new applications for business permits and business renewals. The new business application consolidates all the information of the applicant or requesting party by various local government departments, such as, but not limited to, the local taxes and clearances, building clearance, sanitary permit, zoning clearance, and other specific LGU requirements, as the case may be, including the fire clearance from the Bureau of Fire Protection (BFP).
- BUSINESS ONE STOP SHOP (BOSS) – A one-stop business facilitation service for the city/municipality’s business permitting and licensing system to receive and process manual and/or electronic submission of application for license, clearance, permit, certification or authorization shall be established within the cities/municipalities’ Negosyo Center. Further, there shall be queuing mechanism in the BOSS to manage the application flows.
- Cities/Municipalities are mandated to automate their business permitting and licensing system or set up an electronic BOSS within a period of three (3) years upon the effectivity of this Act for a more efficient business registration processes.
- To lessen the transaction requirements, other local clearances such as, but not limited to, sanitary permits, environmental and agricultural clearances shall be issued together with the business permit.
- Business permits shall be valid for a period of one (1) year. The city/municipality may have the option to renew business permits within the first month of the year or on the anniversary date of the issuance of the business permit.
- Barangay clearances and permits related to doing business shall be applied, issued, and collected at the city/municipality in accordance with the prescribed processing time of this Act: Provided, That the share in the collections shall be remitted to the respective Barangays.
ZERO CONTACT POLICY
The Ease of Doing Business Law mandates that there shall be ZERO CONTACT POLICY between any government officer or employee and people during applications and transactions except during the preliminary assessment or when it is strictly necessary. This policy may reduce graft and corruption in governmental transactions.
THE CITIZEN’S CHARTER
The government units, agencies, GOCCs and others shall make their respective most current and updated service standards to be known as the Citizen’s Charter in the form of information billboards which shall be posted at the main entrance of offices or at the most conspicuous place, in their respective websites and in the form of published materials written either in English, Filipino, or in the local dialectthat detail:
(a) A comprehensive and uniform checklist of requirements for each type of application or request;
(b) The procedure to obtain a particular service;
(c) The person/s responsible for each step;
(d) The maximum time to conclude the process;
(e) The document/s to be presented by the applicant or requesting party, if necessary;
(f) The amount of fees, if necessary; and
(g) The procedure for filing complaints.
ONLINE REGISTRATION FOR BUSINESSES
The Ease of Doing Business Law has makes registration of business easier by mandating online business registration. The Department of Information and Communications Technology (DICT) has been tasked by RA 11032 to establish, operate, and maintain a CENTRAL BUSINESS PORTAL (CBD). The CBP shall serve as a central system to receive applications and capture application data involving business-related transactions, including primary and secondary licenses, and business clearances, permits, certifications, or authorizations issued by the LGUs.
RA 11032 further mandates the DICT to create a Philippine Business Databank (PBD). The PBD will provide government agencies and local government units access to data and information of registered business entities for purposes of verifying the validity, existence of and other relevant information pertaining to business entities.
ANTI-RED TAPE AUTHORITY
The Ease of Doing Business Law creates the Anti-Red Tape Authority (ARTA) to implement and oversee a national policy on red tape. Further, the ARTA is also mandated to implement various reform initiatives to combat red tape and ensure that the various government units and agencies comply thereto.
PENALTIES AND ACCOUNTABILITIES OF OFFICERS AND EMPLOYEES IN THE EASE OF DOING BUSINESS LAW
Government officials and employees who fail to follow the provisions of the Ease of Doing Business Law shall be punished accordingly. In doing so, this places accountability to government officials and employees to ensure that the law shall be followed and its aim shall be achieved.
Written by: Atty. Jon Dominic Peñaranda