A presentation by the National Strategy Office of Botswana

1. CORPORATE REGISTRIES AND EASE OF DOING
BUSINESS
CORPORATE REGISTERS FORUM
21 - 25 May 2018
Presentation by the National Strategy
Office (NSO)
Mbakiso G. Morapedi

2. Corporate Registries – Environment and Purpose
Starting a Business – Global Perspective
Starting a Business – The case of Botswana
Conclusion
2
PRESENTATION OUTLINE

3. q Corporate Registries are indeed a critical vehicle for global
economic growth; they strengthen the ability of the private
sector to create jobs, lift people out of poverty and create more
opportunities for the economy to prosper;
q The performance of Corporate Registries depends a great
deal on the environment in which they operate. Inversely,
Corporate Registries play a major role in improving the
business environment for their customers;
q The Ease of Doing Business is a critical factor in attracting
domestic and foreign direct investment and influences the
general global competitiveness of any country;
q The notion that the private sector has substantial economic,
social and development impact is now universally recognized.
3
CORPORATE REGISTRIES – Purpose & Functions

4. q Promoting a well-functioning private sector is a major
undertaking for many governments today. It requires
long-term policies of removing administrative barriers
and strengthening laws that promote entrepreneurship;
q Doing Business measures aspects of business
regulation and their implications for firm establishment
and operations, covering important areas that are under
the control of policy makers;
q Corporate Registries are where business are born. They
therefore play a major role in improving the ease of
doing business in each country.
4
CORPORATE REGISTRIES – Environment & Purpose

5. q They incorporate new businesses and non-profit
companies, and register partnerships and business
names;
q Corporate Registries maintain publicly available, up-to-
date information on businesses and non-profit
corporations;
q Access to Corporate Registers is essential. Customers
should receive timely and low cost services from
corporate registries to facilitate their operations.
5
CORPORATE REGISTRIES – Environment & Purpose

6. ü Similar requirements for both men and women
ü Putting procedures online
ü No paid-in minimum capital requirement
ü Creation and improvement of one-stop shops
ü Standardized forms
ü No court involvement
ü Fixed registration fee
ü No requirement to publish in legal journal
ü Limited Number of Procedures
Starting a Business: Good practices

7. The frontier in Starting a Business
Indicator
Procedures
(number)
Time
(days)
Cost
(% of income per capita)
Minimum paid-in capital
(% of income per capita)
Frontier
1
0.5
0.0
0.0
Who set frontier?
New Zealand
New Zealand
UK
Australia, Colombia
and other 111 economies

8. Where is it easier to start a business?
1. New Zealand 99.96
2. Canada 98.23
3. Hong Kong SAR, China 98.14
4. Georgia 97.84
5. Jamaica 97.30
6. Singapore 96.49
7. Australia 96.47
8. Ireland 95.91
9. Korea, Rep. 95.83
10. Kosovo 95.67
Top ten performers Score
FrontieronStartingaBusiness
Procedures Time
(days)
Cost
(% of income)
1 0.5 0.3
2 1.5 0.4
2 1.5 1.1
2 2 2.5
2 3 4.8
3 2.5 0.5
3 2.5 0.7
3 5 0.2
2 4 14.6
3 5.5 1

9. 38 economies made starting a business easier in
2016/17
Feature Economies Some highlights
Simplified
preregistration and
registration formalities
Bhutan; China; Democratic Republic
of Congo; Republic of Congo; Czech
Republic; Djibouti; Dominican
Republic; Equatorial Guinea;
Ethiopia; Gabon; Indonesia; Jamaica;
Kosovo; Madagascar; Mauritius;
Morocco; Nigeria; Pakistan; Saudi
Arabia; Senegal; Serbia; Thailand;
Uzbekistan; Zimbabwe
Djibouti made starting a business more affordable by reducing the
fees to register and publish the notice of commencement of activity.
Cut or simplified post
registration
procedures
The Bahamas; Brunei Darussalam;
Ethiopia; Greece; India; Iraq; Kenya;
Madagascar; Malta; Niger; Tajikistan;
Thailand; Zimbabwe
Greece made starting a business easier by creating a unified social
security institution. Malta made starting a business easier by removing
the requirement for a trading license for general commercial activities.
Abolished or reduced
minimum capital
requirement
Cameroon; Republic of Congo.;
Gabon; Niger
Cameroon and Gabon made starting a business easier by reducing
the minimum capital requirement.
Introduced or
improved online
procedures
Turkey; Kenya; Kuwait; Madagascar;
Niger; Saudi Arabia
Madagascar made starting a business easier by publishing the notice
of company incorporation online free of charge.
Created or improved
one-stop shop
Brunei Darussalam; Democratic
Republic of Congo; Kuwait;
Mauritania; Moldova; Niger; Sierra
Leone
Mauritania made starting a business easier by combining multiple
registration procedures. Niger made starting a business easier by
reducing the time needed to register a company and by publishing the
notice of company incorporation online free of charge.

10. • Congo, Dem. Rep. eliminated the requirement that a woman obtain her
husband’s permission to start a business and combined multiple business
registration procedures;
• Ethiopia removed the requirement to open a bank account for company
registration and eliminating the paid-in minimum capital requirement;
• India merged the applications for the Permanent Account Number (PAN) and the
Tax Account Number (TAN), and improved the online application system. Turkey
also merged the applications for the Value-Added Tax and the Profession Tax;
• Saudi Arabia implemented an online system that merges the name reservation
and submission of the articles of association into one procedure. It also
improved the online payment system, removing the need to pay fees in person;
• Thailand abolished the requirement to obtain an approval of the company’s work
regulations from the Labor Department and abolished the requirement to obtain
a company seal.
Two-thirds of reforming economies simplified formalities
during preregistration and registration

11. Reforms making it easier to start a business show results
over time in reduced delays
It was possible to start a business in less than
20 days in only 41 economies*, mostly in North
America and Northern and Central Europe.
Now, the time to start a business is less than 20
days for entrepreneurs in 146 economies*
worldwide.
ü Development impact:
Governments that regulate entry more heavily have greater corruption and larger unofficial economies, but
not better quality of public or private goods.
(Djankov, La Porta, Lopez de Silanes, Shleifer, February 2002, Quarterly Journal of Economics.)
* Based on samples of 174 economies in Doing Business 2006 and 190 economies in Doing Business 2018.
Source: Doing Business database.
2005 2017

12. In most economies it takes between one week and one month to
start a business
Source: Doing Business 2018.

13. Economies with transparent business registries tend to be more
efficient and have lower incidents of bribery
• Time and cost to start a business
Source: Doing Business database; Transparency International database (https://www.transparency.org)
Notes: The features of transparency of information range from 0 (not transparent) to 18 (transparent). Samples for cost and time include 185 and
184 economies after the five highest cost estimates and the six highest time estimates are removed as outliers, respectively. Samples for bribery
levels include 100 and 89 economies covered by both the Doing Business database and the Transparency International database. All
relationships are significant at the 1% level after controlling for income per capita.
0
20
40
60
80
0 3 6 9 12 15 18
Timetostarta
business(days)
Features of transparency of information
0
50
100
150
200
0 3 6 9 12 15 18
Costtostarta
business(%ofGNI)
Features of transparency of information
Levels of bribery
0
25
50
75
100
0 3 6 9 12 15 18
Shareofpeoplewho
paidbribe(%)
Features of transparency of information
0
25
50
75
100
0 3 6 9 12 15 18
Shareofpeoplewho
havebeenaskedto
paybribe(%)
Features of transparency of information

14. Frontier: 1 (New Zealand)
Botswana: 9
Frontier: 0.5 day (New Zealand)
Botswana: 48
Frontier: 0.0% (UK)
Botswana: 0.7%
Frontier: none (113 economies)
Botswana: none
Starting a Business: The case of Botswana
Source: Doing Business 2018.
0
10
20
30
40
50
60
70
80
90
100
Botswana
scored 76.22
points in DTF
on ease of
starting a
business, giving
it a ranking of
153rd in this
area.
Procedures
Time
Cost
Min.
Capital

15. No. Procedure Time Associated Costs
1 Reserve a unique company name 3 days BWP 20
2 Sign the declaration of compliance of statutory
requirements for incorporation before a commissioner for
oaths or company representative
1 day no charge
3 Register the company at the Registrar of Companies,
Ministry of Trade and Industry
6-8 days BWP 300 for the application to register a
company and BWP 60 for the certificate of
incorporation
4 Receive inspection of company premises 7 days no charge
5 Obtain an industrial license from the Industrial Affairs
Department, Ministry of Trade and Industry; or obtain a
trade license from the Gaborone City Council
3 weeks BWP 50 for industrial license if applied by
self; BWP 1,500 by agent; BWP 100 for
trade license if applied by self, BWP 2,000
by an agent
6 Open a bank account 1 day No charge
7 Obtain Tax Identification Number (TIN) from the Botswana
United Revenue Services
7 days no charge by self, BWP 1,500 by agent
8 Register for VAT at the Department of Customs & Excise 7 days no charge by self, BWP 1,500 by agent
9 Register employees for workplace injury insurance 2 days No charge
Starting a Business in Botswana – details (2/2)

16. Starting a Business in Botswana – details (1/2)

17. • Reserve a unique company name
• Sign the declaration of compliance of statutory
requirements for incorporation before a commissioner for
oaths or company representative
• Register the company at the Registrar of Companies,
Ministry of Investment, Trade and Industry
Companies and Intellectual Property Authority (CIPA)
and Starting a Business procedures

18. Similar requirements for men and women
Putting procedures online
No paid-in minimum capital requirement
Creation and improvement of one-stop shops
Standardized forms
No court involvement
Fixed registration fee
No requirement to publish in legal journal
Limited Number of Procedures
Good practices: The case of Botswana

19. • The Roadmap was approved in December 2014 with a view to improve
the investment climate in Botswana.
• Amongst the reforms, the following fall under the purview of CIPA:
i. Introducing business registration deadlines;
ii. Introduction of a Unique Identification Number (UIN) for business;
iii. Use advanced ICT System to digitize company database in the
medium to long-term;
iv. Opt for pre-defined negative listing of company names;
v. Enabling the completion of all procedures related to starting a
business at CIPA; and
vi. Introduction of an Online Business Registration System (OBRS).
Doing Business Reform Roadmap

20. q Reforms completed so far:
• Introduced business registration deadlines and this is going to improve
further once the OBRS is in place;
• In April 2018, Parliament passed the four Bills (Companies (Amendment)
Act; Registration of Business Names (Amendment) Act; Re-registration
of Companies Act; and Registration of Business Names Re-registration
Act). Development of their Regulations is ongoing.
• Enactment of these Acts has paved way for the development of the
Online Business Registration System (OBRS). The key project objective
is to achieve faster, cheaper and more accurate business registration
(while maintaining registry integrity) by streamlining business regulation
and using IT solutions.
• Botswana One Stop Service Centre (BOSSC): shorten and simplify
administrative procedures and guidelines for the issuance of business
approvals, permits and licenses, thereby removing bottlenecks faced by
investors in establishing and running businesses in Botswana.
Status: Starting a Business in Botswana (Cont…)

21. Apart from the reforms under the Registrar, the following reforms
will improve the Starting a Business indicator once implemented:
• One Government Principle;
• Limited number of licenses and Permits: the ongoing
amendment of the Trade Act and the Industrial
Development Act will improve this indicator;
• Abolishing ex-ante inspection of premises; and
• Expansion of the BOSSC mandate to facilitate a broader
scope of investors
Planned Reforms: Starting a Business

22. • The envisaged reforms are meant to enhance the Doing
Business climate in the country.
• The reforms will positively impact on the efficiency of our
corporate registry, which will in turn propel the growth of
the private sector to be the engine of growth in economy.
• The private sector performance and participation in the
economy will ensure effective implementation of the
National Development Plans, which are our vehicle for
achieving our Vision 2036, being a high income country.
Conclusion

23. THANK YOU…