LGUs to streamline business permit, licensing system

MANILA, Philippines – A business registration process of no more than two days in local government units (LGUs) has been agreed upon by three departments, but hurdles remain in luring investors to the country, such as in securing fire safety inspection certificate and barangay clearance.

The Departments of Trade and Industry (DTI), the Interior and Local Government (DILG) and Information and Communications Technology (DICT) signed a joint memorandum circular yesterday enjoining all cities and municipalities to streamline business permits and licensing systems (BPLS) using revised standards.

They also committed to automate government transactions.

Under the new joint circular, LGUs are directed to cut processing time to two days for new business registration and one day for renewals. There must also be a maximum of three steps for both new business registration and renewals in terms of procedure.

All LGUs are likewise directed to use a unified form, both in print and electronic form, with only two signatories required for business permits.

Trade Secretary Ramon Lopez said there was no reason to make investors line up before they could do business in the country.

Interior Secretary Ismael Sueño also stressed investors would be discouraged if they find it difficult to start a business.

Before the issuance of the new joint circular, a similar directive was issued by the DTI and DILG in 2010 to LGUs to facilitate business registration by streamlining transactions and set the processing time to five to 10 days, the maximum number of procedures at five, a unified application form and only two signatories to be able to register a business.

National Competitiveness Council co-chairman for the private sector Guillermo Luz said 75 percent of the LGUs across the country was able to comply with the 2010 circular.

“Once upon a time when we need to get or renew our business permits we had to fill out numerous forms, writing the same information in each form. We have to go through so many windows and so many offices. We have to get so many signatures and everybody was made to do this in the first 20 days of the year. Due to changing times and rising expectation and greater customer demand, we feel it is necessary to reduce the number of these steps,” Luz said.

Aside from streamlining, the new joint circular also urges LGUs to automate and computerize business transactions with the assistance of the DICT to be able to hasten frontline services.

“The DICT in the next few months will develop and make available computer application software to automate local government processes. The system will automate the process of recording, assessment and issuance of business permits. In line with this circular, the DICT will make the system available to LGUs in coordination with DILG, DTI and the NCC,” DICT Undersecretary Jorge Sarmiento said.

According to Lopez, an online system of registration for the country is the end goal of this joint endeavor among DTI, DILG and DICT.

“Once we have streamlined the process, automation should kick in. We should really push for automation down the road because… no one should go to their respective cities anymore. In fact, even a foreign investor who would like to register need not fly to Manila to register business. It can register online in the future. This is being done already by other countries so if they can do it, we can do it as well,” Lopez said.

Luz said the issuance of fire safety inspection certificate and barangay clearance must also be smoothened out and expedited.

He said these were two of the major complaints of businessmen in all their roadshow trips across the country.

Luz said the NCC and the business community wanted the integration of the barangay clearance to what was being done in the municipal level.

As for the fire safety inspection certificates, the NCC urged the government to do a risk profiling and risk management “so those with low risks or virtually no risks are inspected less frequently than those with higher risks.”

“It does not make sense for us to bundle everything as if they were in the same risk category. Maybe we can also extend the validity periods of some of these fire safety inspections beyond a year because anyway, these are low-risk enterprises, and focus on the high-risk enterprises so we can really save lives in that way,” Luz added.

Sueño said his agency would study the NCC’s proposals.

“With regard to barangay clearance, I am of the opinion that barangay clearance should be obtained in one place only, in the city hall or the municipal hall. As for the fire safety inspection certificates, we will ask the fire department,” Sueño said.