With a certificate of urgency, the bill entitled “Registration of Business Act, 2007” was unanimously passed in parliament last Friday.
Dr Kadie Sesay, the trade and industry minister who piloted the bill, told MPs that “Sierra Leone is among the most difficult countries in the world to do business,” quoting the World Bank’s “Doing Business Report”, which ranks Sierra Leone last in the costs incurred to start a new business.
The minister pointed out that the current process for registering a business included seven formal steps and twelve separate administrative activities.
She noted that on average, “it takes 24 days to fulfill all requirements and between $1500 and $5000 in costs that must be incurred to properly establish a business in Sierra Leone”.
Dr Kadie Sesay accepted that considering that, “our GDP per capita is several times lower than the costs outlined here it is no wonder the size of our informal sector and its significance to our economy are not [making any sense].”
She said, “the Act would significantly reduce the number of steps, administrative activities, cost and time for registering a business,” and that it would enhance the competitiveness of the country’s economy as the goal of the government was to make Sierra Leone an attractive destination for private investments.
The minister related that currently, “in order to register a new business, the interested party must visit the Administrator and Registrar General’s office three times to register the company’s name, to register the business and to obtain a business registration license- this process is cumbersome and unnecessary, as all these steps should easily be done in one visit. “
She assured that, “this is precisely what we are recommending. We aim to combine registering the business name and registering the business itself down to a single visit.”
Dr Kadie Sesay said the previous “Business Registration Act” included a number of provisions, which represented significant barriers to investment; pointing out that the need for businesses to renew their registration annually had been removed, as well as the requirement to obtain a clearing certificate from the NRA.
She stated that the new company had discharged all its tax obligations, even though it had not even begun to operate.
The trade minister revealed also that all provisions dealing with the renewal of licenses on an annual basis had been removed because these annual renewals added to the administrative cost of doing business in Sierra Leone without serving any purpose.
“This means that a company, once registered and granted a license, needs not renew that license and that companies will continue to be fully regulated by sectoral license with periodic renewals as specified by law,” she maintained.
The minister also informed that, “the Act also proposes an enhancement of fines imposed for offences committed under the Business Registration Act to Le1 million for failure to exhibit a certificate of registration or general offence of contravening any other provisions of the Act.