DailyNews Online Edition

Improving business climate through eRegulations

TANZANIA Investment Centre (TIC) Acting Executive Director Raymond Mbilinyi (left) discusses a point with one of the stakeholders in investments.

TANZANIA has adopted a web-based tool called ‘eRegulations’, which seeks to help investors and entrepreneurs understand procedures and steps of doing business in the country.

eRegulations, which was developed by the United Nations Conference on Trade and Development (UNCTAD) has proved to be an important tool in improving the business climate in many countries in the world, including neighbours Rwanda.

In Tanzania the eRegulations project is implemented by the Tanzania Investment Centre (TIC) with technical support from UNCTAD and financial support from the One UN fund since May, this year.
 
Through the online database, investors and entrepreneurs can obtain all the necessary information regarding steps involved in registering a company, obtaining certificate of incentives at TIC, obtaining a visa, paying taxes, social protection and more.

“Procedures are detailed on a step by step basis and seen from the users’ point of view. For each step, the system shows the expected result and gives all the information the user needs to know. You will get full contact details of persons in charge, forms and other documents required, costs, time frame, legal basis and a complaints platform,” says Kjartan Sorensen UNCTAD Business Facilitation Manager responsible for the eRegulations programme in Africa.

According to UNCTAD, eRegulations, which is also termed as an e-Government tool, can contribute to greater transparency and efficiency in the public service, improved governance and cost reductions. Specific objectives of the tool include to provide full transparency on rules and procedures by offering online detailed, practical and up-to-date descriptions of the steps they have to go through, seen from the user's viewpoint.
 
The system also helps governments to simplify procedures by allowing easy identification of unnecessary steps;  It also promotes good governance by increasing the awareness of administrative rules and procedures, hence establishing the conditions for a balanced dialogue between the users of the public service and the civil servants;
 
The system sets a basis for regional/international harmonization of rules by facilitating the exchange of good practices among countries.  The eRegulations system is also currently been installed in Argentina, Benin, Burkina Faso, Cape Verde, Cameroon, Colombia, Costa Rica, Congo Brazzaville, Ivory Coast, El Salvador,  Guatemala and Sénégal.

Other countries include Honduras, Mali, Morocco, Nicaragua, Niger, Panama, the Russian Federation (Moscow City), Rwanda,Togo and Viet Nam. According to Mr Sorensen the tool when completed and when used to simplify and publicize procedures should contribute to improve Tanzania’s ranking in the doing business report, which has been deteriorating in recent years.

In 2012 Tanzania ranked number 127, down from 125 in the doing business report of 2011. He also says that experience from other countries such as Rwanda, Togo, Bukina Faso, Ivory Coast and others has shown that there is a positive correlation between raised awareness on procedures through eRegultion systems and the removal of administrative barriers to business registrations and increase in the number of businesses registered.

“When the procedures and steps involved are known to people you should expect more people to start businesses and increased compliance in paying taxes,” says Mr Sorensen. According to Rwandan eRegulations expert Concorde Kananura in Rwanda eRegulations has been running for around 3 years now and it contains 88 procedures in all, both in french and english and receives around 700 visits a week.

“It is used on a daily basis by Rwanda Development Board and other public institutions as a reference for all investor related administrative procedures. Moreover, it has helped identifying areas where there were room for simplification but also communicating on achieved reforms,” says Mr Kananura
 
Following reforms in Rwanda, investors can now register business in one day by going through 2 steps, whereas in Tanzania it takes up to 14 days going through 12 steps.  In Tanzania about 18 documents are needed in total when registering business while in Rwanda only 4 documents. The number of documents involved impact on time and costs involved.
 
After documenting the procedures UNCTAD experts will analyse and provide recommendations to policy makers on the best way to simplify the procedures or steps in order to make them shorter or easier to users. Some of recommendations could be to embrace one-stop-shop at Brela where by apart from registration of companies, Brela could issue business Licences and Taxpayer Identification Number (TIN).
 
Currently, an investor or a business person needs to go to Tanzania Revenue Authority for TIN and Ministry of Industry and Trade or Municipal Councils for business licence. “Reducing paper works and migrating to digital systems would also greatly help reduce time and costs involved in doing business in Tanzania,” says UNCTAD Expert on eRegulations Tanzania, Miss Dank-el Nkya
 
After simplification of procedures experts will have the task to promote the portal both in and outside the country so that many business persons make better use of the tool.
 
According to the TIC Acting Executive Director, Mr Raymond Mbilinyi, his centre will make sure that the project succeeds because it will have an important impact in attracting investors into Tanzania.
 
“We take eRegulations very seriously and we hope many Tanzanians and foreign investors will utilize it as their reference point for obtaining information on procedures of doing business in Tanzania,” says Mbilinyi. When completed the eRegulations website could be accessed at www.tanzania.eregulations.org