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Sixth of a series
To appreciate the regulatory compliance ecosystem in the Philippines, it is best to recall the major developments over the past 15 years in this area. Focus shall be on one of the most important concerns of business enterprises engaging with the government regulators—the aspect of cutting red tape in government towards ease of doing business. Republic Act 9485 or the Anti Red-Tape Act was passed in 2007.
This law intended to effect an efficient delivery of government services and the prevention of graft and corruption. While the Implementing Rules and Regulations were passed in October 2008, it took some time to jump-start the law. It was only in 2013, when Administrative Order 38 was issued to create the Ease of Doing Business Task Force to move forward the anti-red tape law. This inter-agency group was mandated to implement and review the Game Plan for Competitiveness (Plan) designed by the National Competitiveness Council (NCC). The plan identified regulatory reforms that would ease the process of doing business.
The NCC was also tasked to implement policy improvement processes to bring about local and international competitiveness. This Plan formulated a national broadband plan; institutionalized a quality regulatory management system; and removed unnecessary regulatory burden through Project Repeal. The Plan provided recommendations to simplify the rules and regulations on business registration and licensing, entry and exit, paying taxes, and access to finance. Several projects have been initiated primarily by the Department of Trade and Industry and coordinated by NCC, as well as other government agencies: The DTI, Department of the Interior and Local Government and Department of Information and Communications Technology all formulated the Streamlining Business Permits and Licensing System (BPLS). This system provided the revised standards in processing business permits and licenses. The BPLS prescribes a unified form, processing time (maximum of 2 days), number of procedures (3 steps), and number of signatories (2) for BPLS. In 2016, Project Repeal was launched by the NCC. This initiative provided a systematic way of deliberately reviewing rules and regulations that are no longer relevant and have proven burdensome especially for businesses and consumers. Government agencies submit issuances and legislation for review which ends up being: (i) consolidated with other similar regulations, (ii) amended by certain specific provision, (iii) delisted from the agency’s web site and active records, (iv) retained if still necessary, and lastly (v) repealed if rendered irrelevant.
The government made it easier for business companies to pay taxes and make other payroll-related payments by implementing online options. These included the following government agencies: Pag-IBIG’s Online Payment Facility; PhilHealth’s Electronic Premium Remittance System; Bureau of Internal Revenue’s electronic tax filing and e-payment system, and the Social Security System’s online payment scheme.
On May 28, 2018, President Duterte signed Republic Act 11032, or the Ease of Doing Business (EODB) and Efficient Government Service Delivery Act of 2018. The Implementing Rules and Regulations were passed on July 2019. RA 11032 establishes the Anti-Red Tape Authority to implement and oversee a national policy on anti-red tape and ease of doing business. Section 17 of the law provides for the creation of the Anti-Red Tape Authority, the government agency mandated to administer and implement the said law and its IRR, and to monitor and ensure compliance with the national policy on anti-red tape and ease of doing business in the country. An Ease of Doing Business and Anti-Red Tape Advisory Council was created to act as the policy and advisory body to the ARTA, and shall plan, draft and propose the national policy. The ARTA replaced the Ease of Doing Business Task Force while the council replaced the NCC. With the establishments of these two government offices, a notable milestone has been attained in institutionalizing and strengthening the structures for the oversight of the business regulatory compliance ecosystem.
(To be continued)
Joel L. Tan-Torres is the Dean of the University of the Philippines Virata School of Business. Previously, he was the Commissioner of the Bureau of Internal Revenue, the chairman of the Professional Regulatory Board of Accountancy and partner of Reyes Tacandong & Co. and the SyCip Gorres and Velayo & Co. He is a Certified Public Accountant who garnered No. 1 in the CPA Board Examination of May 1979.
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