A study by DEPDev’s Innovation Staff, which serves as the secretariat of the interagency National Innovation Council (NIC), showed that gaps remain between the intent and actual implementation of the Ease of Doing Business (EODB) and Efficient Government Service Delivery Act of 2018, or Republic Act (RA) No. 11032.

In a policy note published last week titled “Streamlining Business Registration, Renewal, and Exit Processes in the Philippines,” DEPDev attributed continuing delays to uneven adoption of the electronic Business One-Stop Shop (eBOSS) across local government units (LGUs), limited interoperability among government systems, weak data sharing between national agencies and LGUs, local capacity constraints, and absence of a standard business exit process.

These gaps have resulted in long processing times, redundant requirements, inconsistent records, and unresolved tax obligations despite existing rules intended to streamline business permitting.

For business registration, 72 percent of respondents still completed the process fully in person at their local business permit and licensing office (BPLO). Most visited BPLOs one to three times, while some made as many as five visits. Processing normally took four to seven days, but nearly one-fourth of respondents waited more than 20 days.

Among the most difficult requirements to secure were Bureau of Internal Revenue (BIR) registration, the Bureau of Fire Protection’s (BFP) fire safety inspection certificate (FSIC), zoning clearance, and sanitation or health permits.

Businesses cited delays caused by waiting for approvals or officials’ signatures, inspection scheduling, system downtime, and long payment queues. The study also found that separate digital systems used by LGUs, the BIR, and BFP require businesses to submit separate applications and repeatedly validate documents.

Overall, 45.1 percent of businesses surveyed were dissatisfied with the registration process, compared with 31.7 percent that were satisfied and 23.2 percent that were neutral.

Business renewals fared somewhat better, although 70.7 percent of respondents still renewed their permits entirely in person and typically made two to three visits to BPLOs.

While processing generally took up to seven days, 17.1 percent of respondents waited more than 20 days. The study cited incomplete requirements, delays in approvals or signatures, and inspection scheduling among the causes.

The January renewal period, particularly before the Jan. 20 deadline, also puts pressure on LGU personnel and digital systems, resulting in processing backlogs. Revalidation of BFP’s FSIC remains separately processed through the agency’s fire safety inspection system (FSIS), which is not integrated with LGU eBOSS platforms.

Dissatisfaction with business renewals stood at 31.6 percent, while 35.4 percent were satisfied and 32.9 percent were neutral.

Business closure emerged as another major problem because, unlike registration and renewal, there are no standardized national guidelines for the process.

Businesses still have to complete closure procedures fully in person with LGUs and the BIR. Processing ranged from two to 20 days, while the BIR’s tax clearance certificate (TCC) was identified as the most difficult requirement to obtain.

The study said fragmented procedures between the BIR and LGUs force businesses to process requirements separately and rely on manual verification. Weak interagency coordination, low digital readiness, and outstanding taxes and penalties can further complicate and raise the cost of formally closing a business.

As a result, 45.2 percent of respondents were dissatisfied with the business exit process, while only 14.3 percent were satisfied and 40.5 percent were neutral.

To address the shortcomings, the policy note recommended four major policy reforms, including making BPLOs permanent offices in LGUs with standardized structures, staffing, and funding, as well as adopting the unique business identification number (UBIN) as the single identifier for all enterprises.

It also proposed requiring government business-permitting systems to work with one another under the implementing rules and regulations of the E-Governance Act, with eGovPH App serving as the central platform for interoperability and the eBusiness Platform as the unified national business-permitting system.

The fourth reform calls for rationalizing barangay-level fees through the local fees and charges (LFC) toolkit, which would provide a standard framework for setting fees and gradually integrate them into local systems and eBOSS platforms.

The policy note also recommended five management processes: strengthening Anti-Red Tape Authority (ARTA) enforcement and monitoring of EODB compliance; coordinating BFP and LGU inspections; establishing a results-based monitoring and evaluation (M&E) framework; improving information and communications technology (ICT) infrastructure and system interoperability; and accelerating digital literacy and information campaigns.

“The policy reform study concludes that significant improvement in the business registration, renewal, and exit processes requires a coordinated set of policy and management processes anchored in legislative strengthening, institutional capacity building, digital integration, standardized procedures, fiscal rationalization, stakeholder capability development, and results-based M&E,” the policy note said.

The study used a combination of desk research, consultations with national agencies and LGUs, business user-journey mapping, an online survey and interviews with enterprises, and a national validation workshop. Participating LGUs were selected based on the Department of Trade and Industry’s (DTI) cities and municipalities competitiveness index, with validation from DEPDev regional offices and the Metropolitan Manila Development Authority (MMDA) to broaden representation.

Among the agencies and organizations that participated in the study were the DTI, ARTA, the Department of the Interior and Local Government (DILG), the Department of Information and Communications Technology (DICT), the Bangsamoro Planning and Development Authority (BPDA), the BIR, and BFP, along with participating LGUs and businesses. - Danielle T. Bayani