Business approval process cut to less than two months

The time taken to complete the paperwork to start a new business has been reduced to less than two months, compared to 174 days previously.
The new system came into effect on February 1, a senior official from the Enterprise Registration Office under the Ministry of Industry and Commerce told Vientiane Times on Friday.
This significantly shortened process is due to the government’s intensified efforts to improve the business environment.
Under the previous system, the World Bank listed 10 procedures that investors had to go through in order to start a business in Laos. It took about 174 days to complete the process, according to the Enterprise Registration Office.
This time-consuming process was one of the reasons for ‘starting a business’ contributing to Laos’ poor performance in the global ease-of-doing business (EDB) index.
To improve the business environment in line with Prime Minister’s Order No. 2, the Ministry of Industry and Commerce has cut out six procedures, leaving only four that a business must complete to begin operations in Laos. It should now take less than two months to fulfil the four procedures.
The cancellation of these six procedures will help a business save not only time but also money, estimated at somewhere between 375,000 and 685,000 kip. 
The six procedures/documents that are no longer necessary are as follows: enterprise location certificate, company regulations registration, taxpayer ID, orientation, company’s seal registration, and enterprise name content.
The four procedures that remain in effect are enterprise registration, crafting of a company’s seal, insurance registration and value-added tax registration.
The streamlining of the approval procedure complies with Prime Minister’s Order No. 2 issued in February last year concerning the improvement of procedures and coordinated mechanisms to facilitate business operations.
Prime Minister Thongloun has instructed ministries, and other bodies responsible for the 11 indicators used by the World Bank to assess ease-of-doing business, to take thorough action to improve their performance and the business environment.
Premier Thongloun announced his government would make significant improvements to Laos’ EDB environment by 2020.
The government’s determination to improve the situation came after the World Bank’s EDB index suggested that Laos’ ranking had deteriorated in recent years. Laos dropped by 13 places to 154th currently among 190 economies worldwide.
The World Bank’s EDB index measures reforms in 11 areas: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency, and labour market regulations.
The Ministry of Industry and Commerce said it has taken steps that significantly ease and speed up border trade.
Laos’ trading across borders facilitation ranking climbed from 124th in 2018 to 76th this year – an improvement of 48 places, according to the ministry’s 2019 trading across borders report.

By Souksakhone Vaenkeo
(Latest Update February 04, 2019)