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Lao PDR: Streamlining and Publishing Business Operating Licenses

The objective of the project was to reform the business licensing regime in Lao PDR to improve the business climate and enhance transparency and accountability in the process to start and operate a business. JC&A worked with the authority leading the process to improve the business climate in Lao PDR, the Department of Enterprise Registration and Management (DERM), withing the Ministry of Industry and Commerce.

Based on a comprehensive assessment of the licensing regime in Lao PDR, JC&A proposed to adopt a risk-based approach towards business licensing to set up a modern business licensing system that reduces burdens on businesses while ensuring compliance with regulatory requirement. The work focused on around two dozen high-impact business licenses.

JC&A prepared a series of guidelines and workshops aimed at public officers on how to adopt a risk-based approach towards licensing. The guidelines were tailor-made in accordance to the main constrains identified to adopt a risk-based approach in Lao PDR, such as the lack of resources from authorities, the misconceptions of the objectives of licensing and the lack of a standard process to apply for a license.

The consultant team then worked with five Ministries to use the guidelines on actual reforms of their licensing regimes. JC&A evaluated the “baseline situation” of the licenses by mapping the process, carrying out a legal assessment and measuring the costs and burdens imposed to businesses using a variant of the Standard Cost Model (SCM). Then, through a re-engineering methodology, JC&A designed a “to be” process and worked with the regulatory authorities to adopt the recommended reforms, mainly to adopt a risk-based approach towards licensing.

Finally, JC&A designed, developed and put online a web portal with the Inventory of Businesses Formalities and Licenses. This an user-friendly online catalogue of all licenses and formalities implemented by the Lao PDR central government will permit national dissemination of information on the process and requirements to apply for a license and the repository of all forms and template. It is also a first step towards e-government and online applications.

World Bank, 2019-2020