Cutting down business conditions: Still weighing on the simplification

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There must be a process for promulgating the business conditions and control of new documents. Picture: collected.

Still growing new business conditions with poor quality

"Business conditions are a big barrier to entry into the market, restricting competition, restricting innovation and affecting the small and medium enterprises adversely. Accordingly, the Government requested the ministries and branches to review and propose to cut 50% of the business conditions, complete and submit them to the Government for signing before October 31, 2018," Director of the Central Institute for Economic Management (CIEM) Nguyen Dinh Cung said.

According to Mr. Phan Duc Hieu, Deputy Director of CIEM, the regulations on business conditions are of low quality, but the State management agencies still considered it a key tool for the State management. It showed the weaknesses in management thinking, lean on management at all costs. In addition, the quality control for regulating the business conditions were ineffective, a lack of adequate enforcement mechanisms, and a lack of effective and regular review and improvement of the quality of business conditions.

With the preliminary assessment on the reviewing results of reducing the business conditions, many opinions agree with the positive results, the Government has made significant progress, promoted the reform of business conditions more evenly among the ministries; more promptly in localities, the reform program has been well done under direction, supervision ...

According to Mr. Phan Duc Hieu, 90 decrees on the business conditions had been amended. After the review of business conditions in the legal documents before the amendment as well as the review of the new decrees on the amendment of business conditions which had just been promulgated, it showed that only 771 business conditions had abolished, while 29 business conditions were arisen. In the total number of current business conditions, the reduction had not reached 50%.

On the impact of the abolition of business conditions, Mr. Hieu said that some abolished business conditions made an impact, but some had made an impact and few had a great impact. "For example, with the business conditions for individuals practicing the construction of land databases, the abolition of "civil capacity" condition has almost no impact," said Mr. Hieu quoted. With the modified business conditions, the CIEM representative also emphasized that few modifiable conditions had a large impact, most of them had moderate or even weak impacts. The most concern, according to Mr. Phan Duc Hieu, still emerged new business conditions with poor quality, such as Decree 49/2018/ND-CP in the field of education. Accordingly, the conditions for the issuance of a certificate of qualification for the education quality verification requested it must be stable offices in two years and had enough rooms for the auditors with an area of at least 8m2 per person, at least 10 auditors working full time... From then on, Mr. Hieu said that business barriers were still quite common, even the representative of CIEM said "It is difficult to imagine how to do with the business conditions after being abolished, amended or supplemented."

"Cutting business conditions is only a part, the quality of business conditions is important. Combining the old business conditions and new business conditions amended, supplemented and promulgated... show that controlling the business conditions is not a small challenge," said Phan Duc Hieu.

Still be timid, not brave in changing the management method

According to the economist, TS. Le Dang Doanh, we put the one-door mechanism into implementation but many enterprises reflected that there were procedure stages carried out online, "but in the last stage, it still requires contact with people and the enterprises, still have to spend "lubrication" costs, even some enterprises reflected the “envelope costs” were even higher than before. With those costs, would Vietnam's goods be competitive?" asked Mr. Le Dang Doanh.

He said that the reform of business conditions was a very necessary and urgent struggle, if it were not improved, the Vietnamese start-up enterprises meeting difficulties related to business conditions would leave the market quickly, the consequences would be very clear when the trade agreements signed, the products and services of foreign enterprises flood into our market. Thinking that management of business conditions was very outdated now, and not in line with the spirit of industrial revolution 4.0, the expert Le Dang Doanh stressed that the State just should manage the condition of providing services into the market, the implementation from production to supplying the market should not be interfered with by the State.

On this issue, Mr. Dau Anh Tuan, Head of Legal Department, Vietnam Chamber of Commerce and Industry (VCCI), said that the cutting and simplification program with the goal of 50% leaned on simplifying rather than abolishing. Mr. Dau Anh Tuan also emphasized that changing the management method was still less, timid, halfway. Typically, the issuance of Decree 15/2018/ND-CP of the Ministry of Health is still low. "Interstate thinking by the State is still popular, in the way that the State is wiser than the market. It can be seen that there is still timidity, not had a strong change of the management method. Meanwhile, the role of other associations and organizations is weak," Mr. Tuan said.

From the situation of reducing business conditions, Mr. Tuan proposed to have the process on issuing the business conditions, controlling new documents. Accordingly, besides the units issuing business conditions, there should be a unit in charge of reviewing the business conditions, this unit must be an independent one within the ministries, and branches, such as the Legal Department of the ministries, and branches. Establishment of new business conditions must have an economic impact assessment. "Merged large enterprises must also carry out the procedures for the assessment of competition restriction, while a regulation affecting the entire industry, affecting the competition greatly has not assessed what the impact is, that is not good,” Mr. Dau Anh Tuan explained. However, the VCCI representative stressed that a lot of business conditions is not a worry, rather the application with non-transparent and non-trust, therefore, we should have a standardization unit for business conditions in government agencies.

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According to Mr. Nguyen Dinh Cung, efforts on reforming the business conditions always needed to be continuous, consistent. As much as 30% of the business conditions were cut, this was likely to have an effect on the enterprises, but this impact depended on the change in the practice method on localities. So here, in addition to abolishing unjustified business conditions, limiting new business conditions, it was necessary to monitor how the implementation of business conditions after being cut is eliminated. And the role of local leaders was very important, which involved the working of officials.