II Quarterly report /Regulatory reform statusREGULATORYREFORMSTATUSReport for the II quarter of 2012
II Quarterly report /Regulatory reform status       1Regulatory reform status in the II quarter of 20121          Introduc...
II Quarterly report /Regulatory reform status       2solved. Business people and citizens will be able to report the compl...
II Quarterly report /Regulatory reform status       3         - Draft Law on the write-off of interest for obligations of ...
II Quarterly report /Regulatory reform status       4data. Also, starting from April 1, submission of electronic VAT appli...
II Quarterly report /Regulatory reform status       5savings, have not been quantified since there were no adequate data, ...
II Quarterly report /Regulatory reform status       6ANNEXES                                                          6
II Quarterly report /Regulatory reform status       7                                                   Appendix 1.       ...
II Quarterly report /Regulatory reform status       8                                                    Appendix 2.      ...
II Quarterly report /Regulatory reform status       9                                                Appendix 3.          ...
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Report for II quarter 2012 - Regulatory reform status

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Report for the second quarter of 2012 on regulatory reform status. The report contains recommendations from NALED's Grey Book and the Comprehensive Regulatory Reform, and the status of their implementation.

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Report for II quarter 2012 - Regulatory reform status

  1. 1. II Quarterly report /Regulatory reform statusREGULATORYREFORMSTATUSReport for the II quarter of 2012
  2. 2. II Quarterly report /Regulatory reform status 1Regulatory reform status in the II quarter of 20121 Introduction For the second year in a row, NALED has been monitoring the regulatory activity in Serbia,and preparing quarterly reports on the progress and results of the Comprehensive Regulatory Reformand the campaign Out of the Maze, in order to inform the business and professional public in Serbiaon the regulatory reform status and pace and encourage responsible institutions to act responsibly. Quarterly report is being published on NALED website and submitted electronically to morethan 3,000 contacts, including decision-makers from private, public and civil sector. This way,transparency is introduced into the process of conducting regulatory reform and the responsibleinstitutions are encouraged to work more efficiently. Report summary The trend of regulatory reform spotted in two previous quarters, occurred due to the pre-election activities, has not changed. We may freely say that it has culminated in the II quarter of 2012. Regulatory activities of the Parliament were almost non-existing, due to the scheduledelections and post-election agreements on the formation of the new Government. The continuation ofthis trend may be expected in the beginning of the next quarter, given that most of the third quarterwill be spent in forming the Parliamentary majority and forming the Government of the Republic ofSerbia. The mentioned inertia of the pre-election and post-election period, when it comes toregulatory reform, can be particularly noticed with the executive authorities, which can be seenthrough the examples of law implementation monitoring and adoption of by-laws. The slowness of reform process was particularly one of the reasons NALED started a mediacampaign for the improvement of business environment titled Ask WHEN, in partnership withNational Broadcasting Service (RTS) and with the support of USAID Business Enabling Project(BEP)and the Open Society Foundation. During the period of six months, which is the duration of thecampaign, NALED and RTS will broadcast short videos dealing with various bureaucratic problemsfaced by the businesses in Serbia (complicated procedures, high and unnecessary taxes, unenforceablelaws) and inform the public on the status and importance of conducting regulatory reforms in ourcountry. The idea of the campaign is to draw public attention and make positive pressure to theresponsible institutions to promise not only what, but WHEN certain bureaucratic problems will be1 Report was prepared by NALED Executive Office. 1
  3. 3. II Quarterly report /Regulatory reform status 2solved. Business people and citizens will be able to report the complicated procedures that impedetheir business or daily functioning and ask the elected representatives when these problems would besolved. The questions may be asked on NALED website and on social networks with the support of WebSistem Media. All the collected proposals will be published on NALED website, and the most relevantquestions will be addressed in the Grey Book of Regulations and submitted as a petition to the newPrime Minister and responsible ministries, who will be asked to provide a concrete answer. NALED willmonitor the work of institutions and report on their readiness to remove the administrative obstaclesfor doing business, in order to inform the business and professional public in Serbia about theregulatory reform status and pace, and encourage the responsible institutions to responsible actions. 75 laws were withdrawn from the Parliament procedure The new parliamentary session, in accordance with the Law, has withdrawn all legalproposals from the parliamentary procedure and returned them to their proposers, a total of 75. Most of the withdrawn acts were submitted to the National Parliament in 2012, nine of thembeing submitted after the parliamentary elections, including two which were submitted between thetwo rounds of presidential elections. It is important to note that these are very important laws, of crucial importance for thebusinesses. Some of the withdrawn proposals have been articulated through previous public debatewith relevant organizations and stakeholders, and some were passed to the Parliament as urgentprocedure, despite the fact that it was clear that they wouldnt make it to the agenda of the previoussession and that they would be returned to the proposer upon the election of the new session. This is another contribution to the politicization of regulatory reform for the purpose of pre-election campaign in the previous period, which should certainly not be allowed in the future, since theconsequence is non-adoption of important regulations, which leads to additional burdens and lossesfor businesses. The most significant withdrawn proposals we would like to point out are the following: - Draft Law on Officers in Local Government Units; - Draft Administrative Procedure Law; - Proposals for approval of additional government borrowing – meaning that the newGovernment will once again consider the proposal for borrowing from Volksbаnk a.d. Beogrаd, for theneeds of constructing new irrigation systems, construction of secondary network and rehabilitation ofthe existing canal network. - Draft Law on the Development Bank – the draft law is expected to be placed for voting in theParliament - Draft Law on the Conversion of Accrued and Unpaid Obligations Towards the Beneficiaries ofMilitary Pensions into Public Debt, - Draft Law on Private Security and Draft Foreign Labor Law, 2
  4. 4. II Quarterly report /Regulatory reform status 3 - Draft Law on the write-off of interest for obligations of paying certain taxes and mandatorysocial insurance contributions, -Draft Law on Adult Education, Elementary and High-School Education As one of the most significant changes of laws, we point out the Public Procurement Law,which will definitely not be returned to the Parliament in any form, bearing in mind that therepresentatives of the new Government emphasized adoption of a new law on public procurement astheir priority. According to the announcements in front of the MPs, the new law should be adoptedalready in September. We will also mention the Law on Amendments and Supplements to the Law on Copyright andRelated Rights. Namely, the necessity of changing the previous law and proposing a new draft law canbe clearly seen when we analyze the example of the so-called „music dinar“ - the best indicator of howa badly- designed and imprecisely determined para-fiscal charge may cause more harm than good, forthe direct payers of this charge, but also for the legislator who determined this charge and thosedetermined as direct beneficiaries of this income. Speaking about harm, firstly we mean the disputes that arose from the very beginning of theimplementation of this charge, for various reasons – disagreements regarding the established rates,establishment of associations which are entitled to collect charges for public broadcast of musicalworks, interpretations and phonograms, as well as special fees etc. There were also individual caseswhere the collection of these charges directly burdened business operations, i.e. it questioned a widerange of business activities, starting from small craft shops, to large IT companies. The greatest number of withdrawn laws are proposals for the ratification of internationalcontracts and agreements, for example, proposals for ratification of agreements of avoiding doubleincome and property taxation of Serbia with Georgia, Tunisia and Canada. It is assumed that the ministries where the ministers remained the same will most probablysubmit the proposals to the Government again, and they will probably be found in front of the MPs forvoting, in the same form. Grey Book – overview of results The Grey Book IV contains 80 recommendations for eliminating administrative obstacles fordoing business. During the past four years, institutions have eliminated or simplified 31 inefficientprocedures to NALED initiative. Bearing in mind the period of institutions forming, there was noprogress in solving problems in the previous period (for detailed overview of the status ofrecommendations made to responsible institutions and potential savings, see Appendix 1). This way, today we have 19 solved problems, 14 problems in the process of being solved orpartially solved, 12 new problems and 35 unsolved. On this occasion we will repeat the key conclusions made at the meeting held with therepresentatives of Tax Administration, which will definitely make doing business easier. It is plannedto enable access to the tax account through e-administration portal and submission of request forsubmitting the tax account balance to an e-mail address. Within this procedure, the only obligation oftaxpayers will be stated in the note of the document itself, saying that, in case of non-compliance ofdata, the taxpayer is referred to the responsible branch office in order to harmonize and update the 3
  5. 5. II Quarterly report /Regulatory reform status 4data. Also, starting from April 1, submission of electronic VAT applications via the e-Taxadministration portal has been enabled. According to the information provided by representatives of Tax Administration, thebusinesses can expect additional services in the field of electronic business in the following period. Thefollowing services have been announced:  insight into the balance via the portal of Tax Administration  introduction of electronic certificates of tax paid  introduction of electronic application for mandatory social insurance contributions  introduction of electronic application for contributions – individual application By-Law Barometer We continue monitoring the dynamics of adopting by-laws through the By-Law Barometer,related to 17 laws adopted in the past two years that are important for improving the economiccompetitiveness of the country. In the second quarter of 2012, 8 by-laws were adopted related to the previously stated laws. We can conclude that, the same as in the I quarter, the most active institution was the Ministryof Justice with 4 adopted Regulations, whose adoption was necessary for the implementation of theLaw on Enforcement and Security. The Ministry of Economy and Regional Development and theSecurities Commission adopted one by-law each, while the Ministry of Environment, Mining andSpatial Planning adopted 2 by-laws related to the Law on Planning and Construction. If we observe the dynamics of adopting subject by-laws, we may conclude that all by-laws wereadopted late compared to the deadline specified in the law whose implementation they concern. When it comes to delay in the adoption of relevant by-laws, the Ministry of Environment,Mining and Spatial Planning is still the leader. In the process of implementing the Law on Planningand Construction, they have adopted Regulation on the manner and procedure for opening andimplementing urbanistic-architectural open calls, 824 late compared to, in NALEDs opinion, areasonable deadline of 6 months. The field of construction and spatial planning has the largest number of by-laws that haventbeen adopted even two and a half years after the adoption of the relevant Law, which was stated in theprevious quarterly report as well. For a detailed overview of adopted by-laws and the delays in their adoption, see Appendix 2. Comprehensive Regulatory Reform – Overview of results By the end of the II quarter of 2012, a total of 205 recommendations have been implemented,which means that 2 recommendations have been implemented during the II quarter. The calculated savings for businesses based on the implemented recommendations of CRRhave remained the same. We should point out that only one part of the CRR recommendations havebeen quantified, while a large number of recommendations, even though they would provide potential 4
  6. 6. II Quarterly report /Regulatory reform status 5savings, have not been quantified since there were no adequate data, or the calculation would be hardto perform. For the first time, we have classified the proposed recommendations of CRR, which have beenunder the jurisdiction of the Office for Regulatory Reform and Regulatory Impact Assessment since2010, by the criterion of jurisdiction based on the newly-established scheme of ministries within thenew Government. Looking at the new scheme of ministries, most of the recommendations relate to the Ministryof Finance and Economy, a total of 207. We can say that 4/5 of the recommendations have beenimplemented, but that the largest number of recommendation that havent been implemented, a totalof 42, are under the jurisdiction of this Ministry. There are 10 non-implemented recommendations under the jurisdiction of the Ministry ofLabor, Employment and Social Policy, while the new Ministry of Construction and Urbanism will be incharge of 3 non-implemented recommendations. For a detailed overview of the status of CRR recommendations towards the regulatoryauthorities and the new scheme of ministries, see Appendix 3. 5
  7. 7. II Quarterly report /Regulatory reform status 6ANNEXES 6
  8. 8. II Quarterly report /Regulatory reform status 7 Appendix 1. Considering the responsible institutions, the status of Grey Book IV recommendations at theend of II quarter of 2012 is as follows: OVERVIEW OF RESULTS, JUNE 2012 RESPONSIBLE PROBLEMS / RESOLVED PARTIALLY UNRESOLVED NEW INSTITUTIONS RECOMMEN PROBLEMS RESOLVED PROBLEMS RECOMME DATIONS PROBLEMS / NDATIONS IN PROCESSMinistry of Finance 37 7 6 18 5Ministry of Health 5 1 - 4 -Ministry of Environment 7 1 1 2 3and Spatial PlanningMinistry of Agriculture, 4 2 - 2 -Trade, Forestry andWater ManagementMinistry of Economy and 3 2 - - 1Regional DevelopmentMinistry of Infrastructure 4 1 1 2 -and EnergyMinistry of Human and 3 1 - 2 -Minority Rights, PublicAdministration and LocalSelf-GovernmentLocal government 2 - - 2 -authoritiesMinistry of Interior 2 - 2 - -Ministry of Labor and 2 - - 1 1Social PolicyMinistry of Culture, Media 1 - - 1 -and Information SocietyMinistry of Justice 2 1 - - 1Problems under 6 2 3 1 -jurisdiction of severalministriesNational Bank of Serbia 2 - 1 - 1TOTAL 80 19 14 35 12 7
  9. 9. II Quarterly report /Regulatory reform status 8 Appendix 2. OVERVIEW OF ADOPTED BY-LAWS IN II QUARTER OF 2012 ( source: By-Law Barometer) RESPONSIBLE LAW BY-LAW DEADLINE ADOPTED INSTITUTIONS WITH DELAY (IN DAYS) 1. Ministry of Economy Company Law Regulation on activities 01/02/2012 124 and Regional considered old and artistic Development crafts, i.e. domestic businesses, the manner of certification and keeping special registry of issued certificates (Article 88) 2. Ministry of Law on Planning Regulation on the conditions 13/06/20122 824 Environment, Mining and Construction and norms for designing and Spatial Planning residential buildings and apartments (Article 201) 3. Ministry of Law on Planning Regulation on the manner 13/06/20123 824 Environment, Mining and Construction and procedure for opening and Spatial Planning and implementation of urbanistic-architectural open calls (Article 201) 4. Ministry of Justice Law on Regulation on the manner of 04/05/2012 168 Enforcement and keeping public record of Security enforcement cases (Article 328, Paragraph 2) 5. Ministry of Justice Law on Regulation on the manner of 20/04/2012 154 Enforcement and enforcement officers annual Security reports 6. Ministry of Justice Law on Regulation on disciplinary 04/05/2012 168 Enforcement and procedure against an Security enforcement officer (Article 355, Paragraph 4) 7. Ministry of Justice Law on Regulation on the rates and 18/05/2012 182 Enforcement and awards and fees for the work Security of enforcement officers Securities The Law on Regulation on the conditions 18/05/2012 182 8. Commission Capital Market for performing financial statements audit of public companies2 The Law itself does not proscribe a deadline for adopting certain by-laws, so for the needs of NALED By-lawBarometer, respecting the comparative legal practice, NALED has determined a deadline of 6 months from thedate of Law entering into force, as a reasonable deadline in these cases.3 The Law itself does not proscribe a deadline for adopting certain by-laws, so for the needs of NALED By-lawBarometer, respecting the comparative legal practice, NALED has determined a deadline of 6 months from thedate of Law entering into force, as a reasonable deadline in these cases. 8
  10. 10. II Quarterly report /Regulatory reform status 9 Appendix 3. CRR OVERBIEW OF THE STATUS OF RECOMMENDATIOS TOWARDS RESPONSIBLE REGULATORY AUTHORITIES RESPONSIBLE INSTITUTIONS NO. OF NO. OF NO. OF NO. OF NON- RECOMME IMPLEMENTED RECOMMENDA IMPLEMENTED NDATIONS RECOMMENDA TIONS IN RECOMMENDATI TIONS PROCESS ONS 1. Ministry of Finance and Economy 207 160 5 42 2. Ministry of Construction and 4 1 0 3 Urbanism 3. Ministry of Energy, Development 1 1 0 0 and Environmental Protection 4. Ministry of Health 9 9 0 0 5. Ministry of Culture and 1 1 0 0 Information 6. Ministry of Agriculture, Forestry 4 3 0 1 and Water Management 7. Ministry of Justice and Public 7 3 1 3 Administration 8. Ministry of Education, Science and 7 3 0 4 Technological Development 9. Ministry of Labor, Employment 11 1 0 10 and Social Policy 10. Ministry of Transport 12 10 1 1 11. Ministry of Foreign and Home 8 6 0 2 Trade and Telecommunications 12. Ministry of Interior 1 1 0 0 13. Republic Geodetic Authority 2 1 1 0 14. Republic Institute for Health 1 1 0 0 Insurance 15. National Bank of Serbia 1 1 0 0 16. Intellectual Property Office 1 0 0 1 17. Tax Administration 1 0 0 1 18. Several regulatory authorities 26 3 20 3TOTAL 304 205 28 71SAVINGS in EUR million 124 22.9 36.2 9

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