The Anti-Red Tape Authority (ARTA) is ramping up its efforts to make the Philippines more attractive for investors by cracking down on local government units (LGUs) that have yet to comply with the government’s mandate in ease of doing business.

Last week, ARTA Secretary Ernesto Perez shared before the World Trade Organization's (WTO) Council for Trade in Services meeting the country’s experiences in leveraging good regulatory practices (GRPs) to facilitate international trade.

During the meeting, Perez said he affirmed the country’s commitment in making sure that regulations are transparent and consistent, aligning with international benchmarks.

On the part of the administration, he said one of the most urgent initiatives for transparency is to ensure that all LGUs are implementing the electronic business one-stop shop (e-BOSS) system.

“Problema talaga dito sa [LGUs] ‘pag mahigpit doon, masisira tayo. Kasi, first impression eh. Before you can engage in business, kailangan mo kumuha ng business permit. Kung doon lang mismo nahirapan ka na, it creates a bad impression. Investors will turn away,” Perez told Manila Bulletin in an interview.

(The problem with some LGUs is that when they’re too restrictive, it hurts us. It’s all about first impressions. Before you can even start doing business, you need to get a business permit. If that process alone is already difficult, it creates a bad impression. Investors will turn away.)

Under Republic Act (RA) No. 11032, or the Ease of Doing Business and Efficient Government Service Delivery Act, LGUs are mandated to build an online portal to process business permits, payments, clearances, and other government documents.

Enacted in 2018, the law required cities and municipalities to establish their respective e-BOSS systems within three years of the law’s effectivity.

Fast forward to 2025, Perez said his agency has flagged 463 non-compliant LGUs.

Of this number, ARTA has filed charges against 117 LGUs after snubbing the agency’s notices to explain.

“Kung wala man lang ginawa, wala man lang explanation, then may basis to file charges,” said Perez.

(If nothing is done, there is no explanation, then there is a basis to file charges.)

The ARTA chief stated that of the LGUs who submitted their explanations, the majority of them are blaming the lack of resources and poor internet connection.

He found this reasoning absurd as even sixth-class municipalities, such as Guinsiliban town in the province of Camiguin, have followed through with the digitization effort.

“Ang sagot really is political will, depende sa mayor kung gusto niya o hindi. Kung gusto niya, may paraan,” Perez told Manila Bulletin.

(The real answer is political will, it depends on the mayor whether they want it or not. If they want it, they’ll find a way.)

Opting out of transparency, according to Perez, would only lead to red tape and corruption.

“This is precisely what the law avoids, we need to be streamlined and digital. The President is very clear on that,” he added.

In its annual report on foreign trade barriers, the Office of the United States Trade Representative (USTR) identified the “pervasive and longstanding” corruption as one of the biggest barriers to trade with the Philippines.