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:
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.
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.
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.
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.
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 +1.806.553.6552 (USA) or +63.917.892.2337 (Philippines). You can also browse our Philippine Business Blog for more helpful articles.