BETTER REGULATION FOR HIGHER GROWTH

23/11/2010

John Daniel Pollner

The World Bank

Sofia, Bulgaria

BETTER REGULATION FOR HIGHER GROWTH

23/11/2010

Sofia, Bulgaria

OUTLINE

Achievements

Challenges

Recommendations

Benefits

ACHIEVEMENTS

POLICY

REFORMER TRACK

RECORD

LEGISLATIONINSTITUTIONS

LARACEARIA

DB: Taxes, Start-upsTax Payments

Better Regulation Program

Doing Business 2011

UK

Denmark

Irelan

d

Finlan

d

Swed

en

Estonia

German

y

Lithuan

iaLat

via

Belgium

France

Netherl

ands

Portuga

l

Austria

Cypru

s

Slova

k R.

Slove

nia

Luxe

mbourg

Hungary

Spain

Bulgaria

Romania

Czech R.

Poland

Italy

Greece

0

20

40

60

80

100

120

4 6 913 14 17

22 23 24 25 2630 31 32

3741 42 45 46 49 51

5663

70

80

109

Time to deal with regulations …

Source: Bulgaria ARC Survey (2009).Note: In 2007, average time = 17% (WB Enterprise Survey, 2007).

…and uncertainty about the rules…

Source: Bulgaria ARC Survey (2009); World Bank Enterprise Survey (2007); BEEPS (2005).

Doing Business in

Municipalities

Law Enforcement

Time to deal with Rules

and Informal Practices

State Fees

Higher Regulatory

Burden Compared to

EU Peers

CHALLENGES

Additional requirements and duplication Sitting on information Lack of public registers Lack of electronic submission of

documents Duplicate registration regimes High local fees and taxes

Putting more on business’ plate:

MUNICIPALITIES

Still, a lot of time by firm’s senior managers

lost in dealing with regulations…

Still, firms reporting unfair competition

from informal business practices

Source: BEEPS (2008-09).

LARACEA Act

HAND OF THE STATE IN ECONOMIC ACTIVITY

Lack of control

unit

No admin. register

Sanctions

Limited scope of the Act

Limited use of “silent

consent”

Unfinished institutional

frame

Lack of RIA for

new regimes

State fees: not fair nor transparent

Lack of policy for state fees

Based on old

legal framework

Weak Institutional

framework for control

Wrong incentives and

lack of transparency

Administrative burden for

business

RECOMMENDATIONSPolicy

Improve business conditions in Municipalities Develop a policy on state fees and empower an “authority” Develop a cost calculation methodology for fees

Legislative

Amend the LARACEA Act Expand the use of RIA Revise legal framework for local administrative charges and

state fees

Institutional

Re-establish Better Regulation Unit authority within CoM Set-up an on-line Administrative Register

BENEFITS

Of time

LOWER COSTS

FAVORABLE BUSINESS CLIMATE

BETTER TRANSPARENCY

LOWER INFORMALITY

Of money

Improved competi-tiveness

Increased revenues

Less red

tape

Trust