58820 Kyrgyz Republic © 2010 The International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington, DC 20433 Telephone 202-473-1000 Internet www.worldbank.org All rights reserved. 1 2 3 4 08 07 06 05 A copublication of The World Bank and the International Finance Corporation. This volume is a product of the staff of the World Bank Group. The findings, interpretations and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of the World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. Rights and Permissions The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The World Bank encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly. 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ISBN: 978-0-8213-7960-8 E-ISBN: 978-0-8213-8630-9 DOI: 10.1596/978-0-8213-7960-8 ISSN: 1729-2638 Library of Congress Cataloging-in-Publication data has been applied for. Printed in the United States Current features News on the Doing Business project http://www.doingbusiness.org Rankings How economies rank-from 1 to 183 http://www.doingbusiness.org/rankings/ Contents Reformers Short summaries of DB2011 reforms, lists of reformers since DB2004 Introduction and a ranking simulation tool and Aggregate Rankings http://www.doingbusiness.org/reforms/ 5 - Year Measure of Historical data Cumulative Change Customized data sets since DB2004 http://www.doingbusiness.org/custom-query/ Starting a Business Methodology and research Dealing with The methodologies and research papers underlying Doing Business Construction Permits http://www.doingbusiness.org/Methodology/ Registering Property Download reports Access to Doing Business reports as well as subnational and regional Getting Credit reports, reform case studies and customized country and regional profiles Protecting Investors http://www.doingbusiness.org/reports/ Paying Taxes Subnational and regional projects Differences in business regulations at the subnational and regional Trading Across Borders level http://www.doingbusiness.org/subnational-reports/ Enforcing Contracts Law Library Closing a Business Online collection of business laws and regulations relating to business and gender issues Doing Business 2011 http://www.doingbusiness.org/law-library/ Business Reforms http://wbl.worldbank.org/ Local partners More than 8,200 specialists in 183 economies who participate in Doing Business http://www.doingbusiness.org/Local-Partners/Doing-Business/ Business Planet Interactive map on the ease of doing business http://rru.worldbank.org/businessplanet Doing Business 2011 : Making a Difference for Entrepreneurs is the eighth in a series of annual reports investigating regulations that enhance business activity and those that constrain it. Doing Business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 183 economies, from Afghanistan to Zimbabwe, over time. A set of regulations affecting 9 stages of a business's life are measured: starting a business, dealing with construction permits, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and closing a business. Data in Doing Business 2011 are current as of June 1, 2010*. The indicators are used to analyze economic outcomes and identify what reforms have worked, where, and why. The Doing Business methodology has limitations. Other areas important to business such as an economy 's proximity to large markets, the quality of its infrastructure services (other than those related to trading across borders), the security of property from theft and looting, the transparency of government procurement, macroeconomic conditions or the underlying strength of institutions, are not studied directly by Doing Business. To make the data comparable across economies, the indicators refer to a specific type of business, generally a local limited liability company operating in the largest business city. Because standard assumptions are used in the data collection, comparisons and benchmarks are valid across economies. The data not only highlight the extent of obstacles to doing business; they also help identify the source of those obstacles, supporting policymakers in designing reform. The data set covers 183 economies: 46 in Sub-Saharan Africa, 32 in Latin America and the Caribbean, 25 in Eastern Europe and Central Asia, 24 in East Asia and Pacific, 18 in the Middle East and North Africa and 8 in South Asia, as well as 30 OECD high-income economies. The following pages present the summary Doing Business indicators for Kyrgyz Republic. The data used for this economy profile come from the Doing Business database and are summarized in graphs. These graphs allow a comparison of the economies in each region not only with one another but also with the "good practice" economy for each indicator. The good-practice economies are identified by their position in each indicator as well as their overall ranking and by their capacity to provide good examples of business regulation to other countries. These good -practice economies do not necessarily rank number 1 in the topic or indicator, but they are in the top 10. More information is available in the full report. Doing Business 2011 : Making a Difference for Entrepreneurs presents the indicators, analyzes their relationship with economic outcomes and recommends reforms. The data, along with information on ordering the report, are available on the Doing Business website (www.doingbusiness.org). * Except for the Paying Taxes indicator that refers to the period January to December of 2009. Note: 2008-2010 Doing Business data and rankings have been recalculated to reflect changes to the methodology and the addition of new economies (in the case of the rankings). 1 Economy Rankings - Ease of Doing Business Kyrgyz Republic is ranked 44 out of 183 economies. Singapore is the top ranked economy in the Ease of Doing Business. Kyrgyz Republic - Compared to global good practice economy as well as selected economies: Kyrgyz Republic's ranking in Doing Business 2011 Rank Doing Business 2011 Ease of Doing Business 44 Starting a Business 14 Dealing with Construction Permits 43 Registering Property 17 Getting Credit 15 Protecting Investors 12 Paying Taxes 150 Trading Across Borders 156 Enforcing Contracts 54 Closing a Business 138 2 Summary of Indicators - Kyrgyz Republic Starting a Business Procedures (number) 2 Time (days) 10 Cost (% of income per capita) 3.7 Min. capital (% of income per capita) 0.0 Dealing with Construction Permits Procedures (number) 13 Time (days) 143 Cost (% of income per capita) 153.9 Registering Property Procedures (number) 4 Time (days) 5 Cost (% of property value) 2.3 Getting Credit Strength of legal rights index (0-10) 10 Depth of credit information index (0-6) 3 Public registry coverage (% of adults) 0.0 Private bureau coverage (% of adults) 11.9 Protecting Investors Extent of disclosure index (0-10) 8 Extent of director liability index (0-10) 7 Ease of shareholder suits index (0-10) 8 Strength of investor protection index (0-10) 7.7 Paying Taxes Payments (number per year) 48 Time (hours per year) 202 Profit tax (%) 8.9 Labor tax and contributions (%) 21.5 Other taxes (%) 26.7 Total tax rate (% profit) 57.2 Trading Across Borders Documents to export (number) 7 Time to export (days) 63 Cost to export (US$ per container) 3010 Documents to import (number) 7 Time to import (days) 72 Cost to import (US$ per container) 3280 3 Enforcing Contracts Procedures (number) 39 Time (days) 260 Cost (% of claim) 29.0 Closing a Business Recovery rate (cents on the dollar) 15.3 Time (years) 4.0 Cost (% of estate) 15 The 5 year measure of cumulative change illustrates how the business regulatory environment has changed in 174 economies from Doing Business 2006 to Doing Business 2011. Instead of highlighting which countries currently have the most business friendly environment, this new approach shows the extent to which an economy's regulatory environment for business has changed compared with 5 years ago. This snapshot reflects all cumulative changes in an economy's business regulation as measured by the Doing Business indicators-such as a reduction in the time to start a business thanks to a one-stop shop or an increase in the strength of investor protection index thanks to new stock exchange rules that tighten disclosure requirements for related -party transactions. This figure shows the distribution of cumulative change across the 9 indicators and time between Doing Business 2006 and Doing Business 2011 0.28 0.24 Doing business has 0.20 become easier (DB change 0.16 score) 0.12 0.08 0.04 Kyrgyz Kazakhstan Ukraine Tajikistan Russian Moldova Republic Federation 6 1. Benchmarking Starting a Business Regulations: Kyrgyz Republic is ranked 14 overall for Starting a Business. Ranking of Kyrgyz Republic in Starting a Business - Compared to good practice and selected economies: 7 The following table shows Starting a Business data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Procedures Time (days) Cost (% of Min. capital (number) income per (% of income Economies capita) per capita) Denmark* 0.0 New Zealand* 1 1 0.0 Selected Economy Kyrgyz Republic 2 10 3.7 0.0 Comparator Economies Kazakhstan 6 19 1.0 0.0 Moldova 8 10 10.9 11.9 Russian Federation 9 30 3.6 1.9 Tajikistan 8 27 36.9 8.5 Ukraine 10 27 6.1 2.2 * The following economies are also good practice economies for : Procedures (number): Canada Cost (% of income per capita): Slovenia 8 2. Historical data: Starting a Business in Kyrgyz Republic Starting a Business data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 14 14 Procedures (number) 9 4 3 2 Time (days) 21 15 11 10 Cost (% of income per capita) 8.8 7.4 5.2 3.7 Min. capital (% of income per capita) 0.5 0.4 0.0 0.0 3. The following graphs illustrate the Starting a Business sub indicators in Kyrgyz Republic over the past 4 years: 9 Starting a Business Summary - Kyrgyz Republic This table summarizes the procedures and costs associated with setting up a business in the Kyrgyz Republic. STANDARDIZED COMPANY Legal Form: Private Limited Liability Company City: Bishkek Registration Requirements: No: Procedure Time to complete Cost to complete 1 Register at the One stop shop Register with the Social Fund and the 7 KGS 230 State Tax and the National statistics 2 Obtain permission to make company seal and make a seal 3 KGS 1,100 10 Starting a Business Details - Kyrgyz Republic Procedure 1 Register at the One stop shop Register with the Social Fund and the State Tax and the National statistics Time to complete: 7 Cost to complete: KGS 230 Comment: In June 2008 the one-stop shop registration procedure came into force: The applicant submits the full package of documents to the one-stop shop at the Ministry of Justice of the Kyrgyz Republic. According to article 10 of the Law "On State Registration of Legal Entities" of the Kyrgyz Republic, the registration of legal entity (LTD) has to be done in 10 calendar days. Since the amendements to the civil code in April 2009, the one stop shop operates officially in 3 days and interacts electronically with all the agencies. As of April, 2009, only 3 documents are needed fo registartion: - application for the company incorporation; -letter stating the entrepreneur's decision to create the LLC - founding agreement; - copies of IDs of founders and managers. 1. Applicant submits all the documents to the one-stop-shop in an application. 2. The office accepts the documents and should carry an expertise of the incorporation documents to make sure they comply with legislation during the 3 days period. 3. Upon expiration of the term, the system delivers an order to register and issue a certificate of registration for the legal entity. This certificate contains the OKPO code, INN code (tax payer number) issued by statistics offices and tax authority via electronic data base correspondingly. Procedure 2 Obtain permission to make company seal and make a seal Time to complete: 3 Cost to complete: KGS 1,100 Comment: The seal-making company requests permission to make its client's company seal. The cost of the seal depends on the delivery time (say, 2 hours versus 1 day). The faster the delivery, the higher the cost. The Presidential decree of 23rd April nb 182 makes the use of the seal optional, however in practice, companies still use it. 11 12 1. Benchmarking Dealing with Construction Permits Regulations: Kyrgyz Republic is ranked 43 overall for Dealing with Construction Permits. Ranking of Kyrgyz Republic in Dealing with Construction Permits - Compared to good practice and selected economies: 13 The following table shows Dealing with Construction Permits data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Procedures Time (days) Cost (% of (number) income per Economies capita) Denmark 6 Qatar 0.8 Singapore 25 Selected Economy Kyrgyz Republic 13 143 153.9 Comparator Economies Kazakhstan 34 219 119.8 Moldova 30 292 120.9 Russian Federation 53 540 4141.0 Tajikistan 30 228 996.1 Ukraine 22 374 1737.6 14 2. Historical data: Dealing with Construction Permits in Kyrgyz Republic Dealing with Construction Permits data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 46 43 Procedures (number) 23 14 13 13 Time (days) 338 165 143 143 Cost (% of income per capita) 709.9 449.5 184.0 153.9 3. The following graphs illustrate the Dealing with Construction Permits sub indicators in Kyrgyz Republic over the past 4 years: 15 Dealing with Construction Permits in Kyrgyz Republic The table below summarizes the procedures, time, and costs to build a warehouse in the Kyrgyz Republic. BUILDING A WAREHOUSE City: Bishkek Registration Requirements: No: Procedure Time to complete Cost to complete 1 File application-intention and obtain City Planning Regulation of 28 days KGS 13,533 Architectural Planning Conditions (A) from the unit of State Department for Architecture and Construction Supervision 2 * Request and obtain technical conditions to connect to networks for 14 days KGS 720 telephone line 3 * Request and obtain topographic and geological survey conclusions of land 14 days KGS 7,500 from Kyrgyz GIIZ 4 Request approval of project, expertise of project documents and obtain 56 days KGS 18,159 building permit 5 Request and obtain authorization to conduct earthwork in the road section 5 days no charge 6 Request and obtain equipment operating authorization 15 days no charge 7 Receive connection to electricity 10 days KGS 1,000 16 8 * Receive connection to water and sewage services 10 days KGS 4,253 9 * Receive connection to telephone 10 days KGS 3,380 10 Request Act of Acceptance of Object for Use 1 day no charge 11 Receive inspection and obtain the Act of Acceptance of Object for Use 13 days no charge 12 Request and obtain a technical inventory 6 days KGS 5,100 13 Register the building with the real estate registry 7 days KGS 1,291 * Takes place simultaneously with another procedure. 17 Dealing with Construction Permits Details - Kyrgyz Republic Procedure 1 File application-intention and obtain City Planning Regulation of Architectural Planning Conditions (A) from the unit of State Department for Architecture and Construction Supervision Time to complete: 28 days Cost to complete: KGS 13,533 Agency: State Architecture Department of Bishkek City Comment: In accordance with the Regulation "On Order for Issuing Permits for Project Designs, Construction and Real Estate Modification and Order for Commissioning Completed Building the Kyrgyz Republic" approved by Government of KR on May 30, 2008, by Resolution # 252, the issuance of Architectural Planning Terms (APU) shall be conducted according to One-Stop-Shop principle. The list of documents required for issuance of APU was reduced. In particular, a business is only expected to fill up an established application which contains information on the type of upcoming construction and submit it along with the following documents: copy of the land title that verifies that a land plot was purchased or leased, letter of attorney, invoice on advanced payment (advance payment is required while obtaining an APU, the remainder is paid after a business receives the APU). A territorial architecture and construction body, within 3 business days, performs the check for compliance of an application form with requirements set by urban planning documentation. In case of non-compliance, the territorial architecture and construction body issues a Report on Non-compliance of Construction Intends and returns the application without approval. In each case the body is obliged to indicate the established types of permitted land use pursuant to the urban planning documentation. In case the territorial architecture and construction body approves the application, it submits the application for further approval to the sanitary and epidemiology body, fire authority, and environmental authority. After that the application is forwarded to utilities companies by the main coordinating agency- State Construction Department for obtaining technical terms to install such utility systems as power supply, water supply, sewage system, heating and gas supply using One-Stop-Shop principle without participation of the applicant. The State Construction Department has 20 working days within which it must obtain approvals, internally from all utilities, and other relevant authorities. Resolution # 252 gives all utility providers 10 working days to approve the technical conditions. Moreover, utility providers cannot reject the possibility of connection without providing alternative options. Lack of an opportunity to connect an object to utilities systems may not be a ground for refusal of issuing APU. Meanwhile, the Sanitary, Fire and Environmental Services will also have a 10 working days to grant their approvals, after which a silence-is-consent rule will apply. The payment can be made at the counter of State Architecture Department of Bishkek City. Then the shares of each respective utility provider are transferred without BuildCo visiting each separately. APU is executed in two copies, one of this is issued to the applicant and the other is stored in architecture and construction body. As of 12 February 2009, new Government Resolution# 121 introduced amendments to the Regulation "On Order for Issuing Permits for Project Designs, Construction and Real Estate Modification and Order for Commissioning Completed Building the Kyrgyz Republic" approved by Government of KR on May 30, 2008, by Resolution # 252. There are now only two technical conditions that must be obtained in a compulsory manner- for water/ sewage and electricity. The remaining communications can be obtained on 18 voluntary basis by applicants and are not linked to obtaining the Architectural Planning Conditions. Meanwhile, if applicant suggests alternative solutions to connecting to engineering facilities, then requests for technical conditions are not filed at all. Based on functional purpose of the building approvals from sanitary and fire authorities are applied using risk based system. Simple objects would not require approvals from these authorities. Additionally, requirements for documents to be submitted along with application have been clarified. These administrative simplifications made the process of issuance of Architectural Planning Conditions faster and possible to comply within the time-limit of 20 working days (28 calendar days). Despite reforms in disclosing the information on fee schedules the process of cost calculation for this procedure remains closed and indiscreet. Procedure 2 Request and obtain technical conditions to connect to networks for telephone line Time to complete: 14 days Cost to complete: KGS 720 Agency: Kyrgyztelecom Comment: Resolution #252 provides for the State Architecture Department and its territorial branch in Bishkek to issue the APU without acquiring the technical terms from telephone service providers. For this reason, the procedure is not mandatory and the applicant takes an individual decision on services of which company may be used. The conditions may be requested at any stage of construction. Most applicants requests it right before connecting to telephone services. Although, the local telecom market has various companies that provide fixed line services, it is most likely that the natural monopolist ­Kyrgyztelecom would be the one with the widest network services. According to Kyrgyztelecom's regulations in order to connect to its services the applicants must obtain technical terms beforehand. Procedure 3 Request and obtain topographic and geological survey conclusions of land from Kyrgyz GIIZ Time to complete: 14 days Cost to complete: KGS 7,500 Agency: Kyrgyz GIIZ Comment: Although there are several licensed companies that provide these services KyrgyzGIIZ has the biggest database of maps back from late Soviet years of the country. Engineering ­geological studies have not been done since the collapse of Soviet Union, and any new land developed after it would require BuildCo to request the full study. However, there are certain parts of the city that can be considered to have the proper geological study. In that case BuildCo would have to request a certificate on geological survey, assuming that the actual geological survey which is very costly (up to 3,000 USD), or the survey of adjacent plot has been done. The cost for this certificate can be anywhere between 5 to 10,000 KGS. Kyrgyz GIIZ is the only licensed institution in the country with proper equipment and capacity. Procedure 4 Request approval of project, expertise of project documents and obtain building permit Time to complete: 56 days 19 Cost to complete: KGS 18,159 Agency: State Architecture Department/ State Expertise Authority/State Department for Architecture and Construction Supervision Comment: This procedure consists of three stages: approval of project documents; expertise of documents; issuance of building permit. All three stages are done under one stop shop principle. A single application is filed by the applicant to obtain all these approvals. The approval of project documents consists of two stages: initial review of drawings and plans, and other relevant chapters of the projects is done by the territorial branch of State Architecture Department. BuildCo submits at this stage its application along with the following documents: Project documents (drawings, plans); private projects are not required to submit any financial segment of the project (abolished by the Resolution #252). Engineer-geological study (for expertise). Copies of letters authorizing persons responsible for construction works: technical supervision, author supervision; and for contractor (for construction permit). Copies of licenses for construction works (for construction permit). Positive conclusion from respective Institute of State Agency of Architecture and Construction and other licensed agencies which have the right to provide engineering assessment of objects no lower than two stories stating possibility of reconstructing, re-profiling or re-planning of objects (for construction permit). Any other documents are considered illegal. The authority must issue its approval within 10 working days. Following that it will send two copies of all documents for review of State Expertise Authority. According to Resolution #252 (30.05.08), and Government Resolution # 75 as of 4 February 2009, the expertise can be conducted by private companies, but until now there has not been a single license issued for expertise works. The nature of the expert assessment has been changed too. In past, the expert assessment was focused on the cost estimated of the project, which is prohibited by the mentioned above regulation. The expert assessment of the project design documents is conducted by State Expertise Authority and its territorial bodies or privately licensed companies, to check the following aspects: Compliance of the object with requirements set by Architectural Planning Terms, Project Design Terms and City Planning Documentation; Justification of space-planning and construction decisions, construction materials and equipment, solidity and durability of the bearing structure of buildings; Check the results of geotechnical survey; Based on results of the conducted expert assessment, State Expertise Authority prepares a report on compliance of the project design documents with normative requirements. In case of any irregularities, State Expertise Authority prepares another report on bringing the project design documentation in compliance which indicates the said irregularities or a report on refusal of approving the project design. Under current legislation there are categories of objects that do not require state expert assessment. There are notions of mandatory and voluntary expert assessment and possibility for expert assessment of project documentation by private experts or organizations. BuildCo's case would qualify for the expert assessment. 20 No later than a day following the approval date, which is 20 working days for projects higher than 1000 sq.m., the report with positive expert assessment is submitted to State Architecture and Construction Supervision for issuing a construction permit. The State Architecture and Construction Supervision has to issue the building permit in 10 working days. Otherwise silence is consent principle applies. Amendments regarding construction supervision process were made to Law "On Changes to Law of the Kyrgyz Republic" #101 as of 30 March 2009, "On City Construction and Architecture of the Kyrgyz Republic" Article 40, and Government Resolution # 95 "On approving the Order on Classification of Construction Object Characteristics and Order of Conducting State Architecture-Construction Supervision, Reconstruction and Other Real Estate Objects in the Kyrgyz Republic". According to these reforms the building supervision process is now based on risk based approach. Compulsory state control over building process is applied for buildings that fall into high-risk category. Low risk categories, buildings exceeding 1350 sq.m., are now subject to author and technical supervision, and do not require state supervision. Thus, it removes the need for signing a special contract with State Architecture and Construction Supervision and paying respective fees. Both author and technical supervision can be done by BuildCo staff. At the time of issuing the building permit, BuildCo will receive a schedule of inspections to be carried out by State Architecture and Construction Supervision. The inspections will take place three times: foundation works, structure and final one. All inspections can be notified via phone and do not require a special visit. This brings the overall time to 56 calendar days. Cost consists of the following components: - approval of project documentation ­ KGS 8260 - the expertise of project documents ­ KGS 9899.4. T Additionally, the base for calculation of expertise fee was reformed by Order of State Agency of Architecture and Construction on 16 June 2008 and it comprises now based on fixed formula ­ KGS 7,45 x sqm. (excluding 12% VAT). It abolished the previous fee which was based on project value of 0.3%. - building permit- is free of charge. Total cost: KGS 18,159.4 Procedure 5 Request and obtain authorization to conduct earthwork in the road section Time to complete: 5 days Cost to complete: no charge Agency: City Road Department of Municipality of Bishkek Comment: According to Decision of Bishkek City Council as of 4 February 2009 which eliminated Resolution of Bishkek City Council # 194 as of 9 June 2003, applicants now need to obtain only a warrant (naryad) for conducting works in public road area. Previous requirement has been eliminated under general administrative simplification process. The authority responsible for issuing this document is now City Road Department under Municipality of Bishkek, formed in August 2008, and replaced the authority of District Administrations. Under the new provision there is no fee related to this procedure. Procedure 6 Request and obtain equipment operating authorization Time to complete: 15 days Cost to complete: no charge 21 Agency: State Inspection for Supervision of Industry Safety and Mountain Supervision under the Ministry of Natural Resources of Kyrgyz Republic Comment: Under the existing regulation this authorization is required to allow the use of cranes and excavators, and elevators. Five days before using the equipment BuildCo will file a request, followed by a visit by inspector from the Inspection by Gostechnadzor. The inspector having reviewed the equipment to be used puts a stamp and signs the technical passport of the new projects. Regulatory simplification reform process also eliminated duplicating legislation concerning the fees for equipment operation authorization. This eliminated the grounds for officers by State Technical Supervision to levy fees. Eliminated fee amount is KGS 1462. Procedure 7 Receive connection to electricity Time to complete: 10 days Cost to complete: KGS 1,000 Agency: Bishkek Power Supply Company Comment: Connection can be done without prior inspection should the location be with existing utility infrastructure. Government Resolution #100 as of 10 February 2009 "On Approving Rules for Issuing Technical Conditions and Connection to Engineering and Technical Supply Facilities in Kyrgyz Republic" introduced new guidelines for connection to utilities. All connections and contracts must be executed before occupancy permit is issued. All connections must be done in 10 days. Procedure 8 Receive connection to water and sewage services Time to complete: 10 days Cost to complete: KGS 4,253 Agency: Bishkekvodokanal Comment: Connection can be done without prior inspection should the location be with existing utility infrastructure. Procedure 9 Receive connection to telephone Time to complete: 10 days Cost to complete: KGS 3,380 Agency: Kyrgyztelecom Comment: Connection can be done without prior inspection should the location be with existing utility infrastructure. Procedure 10 Request Act of Acceptance of Object for Use Time to complete: 1 day Cost to complete: no charge 22 Agency: State Architecture and Construction Supervision Comment: Within 10 after completion of construction BuildCo files a request to the State Architecture and Construction Supervision requesting issuance of Act of Acceptance of Object for Use. This approval must be issued within 10 working days. If the Act is not issued within the established timelimit, silence is consent rule applied. The Act must be signed by applicant, author of project, general contractor, representative of State Architecture and Construction Supervision's regional branch who performed the technical supervision during construction. The Act must be endorsed by the head of territorial branch of State Architecture and Construction Supervision. Government Resolution #121 as of 12 February 2009 removed requirement for participation of fire and sanitary authorities in the final inspection. Procedure 11 Receive inspection and obtain the Act of Acceptance of Object for Use Time to complete: 13 days Cost to complete: no charge Agency: State Architecture and Construction Supervision Comment: The inspection may take place, based on the case. Sometimes, if the supervising technical inspector provides sound feedback to the regional head office the inspection may not be required. However, a separate visit is paid to obtain the actual copy of Act. The Act is a legal document that allows the immediate use of building. Procedure 12 Request and obtain a technical inventory Time to complete: 6 days Cost to complete: KGS 5,100 Comment: Before registering the building with the real property registry, it is required to obtain a "technical passport". This describes the structure of building, units, dimensions, building layout, and the like. The technical inventory in 10 days costs KGS 2,600, and in 4 working days KGS 5,100. Procedure 13 Register the building with the real estate registry Time to complete: 7 days Cost to complete: KGS 1,291 Agency: State Agency on Registration of Rights on Immovable Property Comment: Registration of buildings is a mandatory procedure. BuildCo must provide the following documents to the State Agency for Registration of Real Property Rights: - Application. - Documents confirming the ownership title (the plot plan, the local plan, and the "technical passport"* of the warehouse). - Receipt of payment for registration - State Certificate on Land Ownership - Occupancy Permit - Power of Attorney After examining the submitted documents, a registrar issues a report for registration of the building, makes a log entry, and issues a registration card, a copy of which is provided to 23 BuildCo. According to amendment to Law "On State Registration of Rights for immovable property" as of 30 March 2009 and State Registration Agency Decree # 80 as of June 11, 2008, effective 7 July 2008, the first time registration is now conducted in 7 working days. Fast track option can be done in 5 days, which includes one day for registration and 4 working days for technical inventory. Legal entities may register the building in 7 days for KGS 677.8 and for KGS 1,291 in 1 day. 24 25 1. Benchmarking Registering Property Regulations: Kyrgyz Republic is ranked 17 overall for Registering Property. Ranking of Kyrgyz Republic in Registering Property - Compared to good practice and selected economies: 26 The following table shows Registering Property data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Procedures Time (days) Cost (% of (number) property Economies value) New Zealand* 2 Norway* 1 Saudi Arabia 0.0 Selected Economy Kyrgyz Republic 4 5 2.3 Comparator Economies Kazakhstan 4 40 0.1 Moldova 5 5 0.9 Russian Federation 6 43 0.1 Tajikistan 6 37 5.5 Ukraine 10 117 4.1 * The following economies are also good practice economies for : Procedures (number): United Arab Emirates Time (days): Saudi Arabia, Thailand, United Arab Emirates 27 2. Historical data: Registering Property in Kyrgyz Republic Registering Property data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 19 17 Procedures (number) 7 7 4 4 Time (days) 8 8 5 5 Cost (% of property value) 4.6 3.9 2.8 2.3 3. The following graphs illustrate the Registering Property sub indicators in Kyrgyz Republic over the past 4 years: 28 Registering Property in Kyrgyz Republic This topic examines the steps, time, and cost involved in registering property in the Kyrgyz Republic. STANDARDIZED PROPERTY Property Value: 1,784,406.85 City: Bishkek Registration Requirements: No: Procedure Time to complete Cost to complete 1 The seller obtains a Registration Certificate from the 1 day expedited (3 KZS 188.10 (regular) or Gosregister (Land Registry) days regular) KZS 327.50(expedited) 2 A public notary notarizes the sale-purchase agreement 1 day KZS 40,000 fixed fee + KZS 350 (notarization of copies) 3 The buyer applies to Gosregister for registration of 3 days regular; 1 day KZS 643.9 (regular the title transfer expedited procedure - 3 days) or KZS 1231 (expedited procedure - 1 day) fees for legal entities 4 The buyer receives documents of title upon 1 day Already paid in procedure 3 completion of the registration 29 Registering Property Details - Kyrgyz Republic Procedure 1 The seller obtains a Registration Certificate from the Gosregister (Land Registry) Time to complete: 1 day expedited (3 days regular) Cost to complete: KZS 188.10 (regular) or KZS 327.50(expedited) Agency: Land Registry (Gosregister) Comment: In case the parties chose to notarize their sale-purchase agreement, the buyer requests the seller to provide him with the Registration Certificate evidencing his rights to the property. This Certificate indicates the owner of the property and provides information on the existence or absence of encumbrances over the property. The documentation shall include: · Application (in the established form); · Copy of ownership document; · Original and a copy of technical passport; · Identification documents; · Copy of resolution of the management body on the sale of the property; The cost of the regular procedure (3 days) is KZS 188.10 and KZS 327.50 for an expedited procedure (1 day). Procedure 2 A public notary notarizes the sale-purchase agreement Time to complete: 1 day Cost to complete: KZS 40,000 fixed fee + KZS 350 (notarization of copies) Agency: Public Notary Comment: The Law of the Kyrgyz Republic on Amendments to the Civil Code of the Kyrgyz Republic #104 of 30.03.2009 introduced voluntary notary certification of property disposal (sale and acquisition) contract. Previously, it was mandatory to notarize the sale-purchase agreement with a public notary. Now, parties have a choice to have notaries register such contracts or make a transaction and register it directly with the State Register. Should parties chose to notarize the sale-purchase contract, the cost for the procedure for non-residential properties with a square footage higher than 400 square meters is KZS 40,000 (as prescribed by the Resolution of the Republic of Kyrgyzstan #733 of 19.10.2006 "On State duties". As of June 2009, around half of property transactions are still being notarized. The parties must also notarize copies of their respective charters and/or foundation agreements and corporate registration certificates (to be later presented to the registrar). Notarization of copies will cost KZS 5 per page plus KZS 10 per one document; total approximately KZS 350. During the notarization, the parties will be required to submit copies of the parties' respective charters and foundation agreements, corporate registration certificates, resolutions of the management bodies on the purchase/sale of the property, powers of attorney, a certificate evidencing the balance sheet value of the property, and certain other corporate documents. The seller shall also present the registration certificate evidencing the seller's title to the property (obtained in procedure 1). 30 Procedure 3 The buyer applies to Gosregister for registration of the title transfer Time to complete: 3 days regular; 1 day expedited Cost to complete: KZS 643.9 (regular procedure - 3 days) or KZS 1231 (expedited procedure - 1 day) fees for legal entities Agency: Land Registry (Gosregister) Comment: The buyer appears at the local office of Gosregister and presents all the required documents. The buyer (the seller may pay it upon agreement between the parties) pays the registration fee and delivers to the registrar the receipt evidencing the payment and a formal application for the registration of the title transfer. The notarized sale purchase agreement must be presented to the local office of Gosregister no later than 30 days from the moment of its signing (otherwise a penalty fee is charged). The Gosregister issues the receipt about the acceptance of the documents for the registration and conducts the registration during 3 days or 1 day, if the procedure is expedited. The buyer receives his own copy of the agreement where the Registry certified the registration, as well as the copy of record card, where it will be marked that he is the owner of this property. The buyer must also visit a separate window at the Registry for a separate application (previously BTI Office). This can be done at the same time as at the Gosregister. The Land Registry makes correspondent alterations in the inventory file of the building and land plot and provides the buyer with the new cadastral plan of the building and cadastral plan of the land plot. The documentation shall include: · Application (in the established form) · State act on land property right; · Technical original passport; · The signed and notarized sale and purchase agreement (Obtained in Procedure 2); · Powers of attorney (if needed), notarized copies of the buyer charter and/or foundation agreement, corporate registration certificate, resolution of the management bodie on the purchase of the property. The cost for the procedures was updated with the Order #80 of June 11, 2008 of the Land Registry (Gosregistr). Thus, the cost for the 3 day registration is KZS 643.9 and for the expedited procedure is KZS 1231. In practice, the expedited procedure still takes 2 days. Procedure 4 The buyer receives documents of title upon completion of the registration Time to complete: 1 day Cost to complete: Already paid in procedure 3 Agency: Land Registry (Gosregister) Comment: After the registration is completed, the buyer appears at the Gosregister to pick up his copy of the agreement bearing the stamp of the registrar, the amended technical passport for the property, and the State act on land property right. The documentation shall include: the passport of the buyer, or a power of attorney or other documents confirming the rights of the individual to pick up the documents on behalf of the buyer. 31 32 1. Benchmarking Getting Credit Regulations: Kyrgyz Republic is ranked 15 overall for Getting Credit. Ranking of Kyrgyz Republic in Getting Credit - Compared to good practice and selected economies: 33 The following table shows Getting Credit data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Strength of Depth of Public Private legal rights credit registry bureau Economies index (0-10) information coverage (% coverage (% index (0-6) of adults) of adults) New Zealand* 100.0 Portugal 67.1 Singapore* 10 United Kingdom 6 Selected Economy Kyrgyz Republic 10 3 0.0 11.9 Comparator Economies Kazakhstan 4 5 0.0 29.9 Moldova 8 0 0.0 0.0 Russian Federation 3 5 0.0 14.4 Tajikistan 3 0 0.0 0.0 Ukraine 9 3 0.0 10.1 * The following economies are also good practice economies for : Strength of legal rights index (0-10): Hong Kong, China, Kenya, Kyrgyz Republic, Malaysia Private bureau coverage (% of adults): Argentina, Australia, Canada, Iceland, Ireland, Norway, Sweden, United Kingdom, United States 27 countries have the highest credit information index. 34 2. Historical data: Getting Credit in Kyrgyz Republic Getting Credit data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 14 15 Strength of legal rights index (0-10) 7 7 10 10 Depth of credit information index (0-6) 2 3 3 3 Private bureau coverage (% of adults) 1.6 3.7 5.9 11.9 Public registry coverage (% of adults) 0.0 0.0 0.0 0.0 3. The following graphs illustrate the Getting Credit sub indicators in Kyrgyz Republic over the past 4 years: 35 Getting Credit in Kyrgyz Republic The following table summarize legal rights of borrowers and lenders, and the availability and legal framework of credit registries in the Kyrgyz Republic. Getting Credit Indicators (2010) Indicator Private credit Public credit Private bureau coverage (% of adults) 3 bureau registry Are data on both firms and individuals distributed? Yes No 1 Are both positive and negative data distributed? No No 0 Does the registry distribute credit information from retailers, trade No No 0 creditors or utility companies as well as financial institutions? Are more than 2 years of historical credit information distributed? No No 0 Is data on all loans below 1% of income per capita distributed? Yes No 1 Is it guaranteed by law that borrowers can inspect their data in the Yes No 1 largest credit registry? Coverage 11.9 0.0 Number of individuals 444,277 0 Number of firms 1,129 0 36 Strength of legal rights index (0-10) 10 Can any business use movable assets as collateral while keeping possession of the assets; and any financial Yes institution accept such assets as collateral ? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, Yes without requiring a specific description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without Yes requiring a specific description of collateral? May a security right extend to future or after-acquired assets, and may it extend automatically to the products, Yes proceeds or replacements of the original assets ? Is a general description of debts and obligations permitted in collateral agreements, so that all types of obligations Yes and debts can be secured by stating a maximum amount rather than a specific amount between the parties ? Is a collateral registry in operation, that is unified geographically and by asset type, as well as indexed by the Yes grantor's name of a security right ? Do secured creditors have absolute priority to their collateral outside bankruptcy procedures? Yes Do secured creditors have absolute priority to their collateral in bankruptcy procedures? Yes During reorganization, are secured creditors' claims exempt from an automatic stay on enforcement? Yes Does the law authorize parties to agree on out of court enforcement? Yes 37 38 1. Benchmarking Protecting Investors Regulations: Kyrgyz Republic is ranked 12 overall for Protecting Investors. Ranking of Kyrgyz Republic in Protecting Investors - Compared to good practice and selected economies: 39 The following table shows Protecting Investors data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Strength of investor Economies protection index (0-10) New Zealand 9.7 Selected Economy Kyrgyz Republic 7.7 Comparator Economies Kazakhstan 6.0 Moldova 4.7 Russian Federation 5.0 Tajikistan 5.7 Ukraine 4.7 40 2. Historical data: Protecting Investors in Kyrgyz Republic Protecting Investors data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 12 12 Strength of investor protection index (0-10) 6.0 7.7 7.7 7.7 3. The following graph illustrates the Protecting Investors index in Kyrgyz Republic compared to best practice and selected Economies: 9.7 7.7 6.0 5.7 5.0 4.7 4.7 n an ta nd ub z ne a ep rgy ov hs ist ra n ai lic a de sia n ak d jik al kr y tio ol Fe us Ze K az Ta U M R K ew R N Note: The higher the score, the greater the investor protection. 41 Protecting Investors in Kyrgyz Republic The table below provides a full breakdown of how the disclosure, director liability, and shareholder suits indexes are calculated in the Kyrgyz Republic. Protecting Investors Data (2010) Indicator Extent of disclosure index (0-10) 8 3 What corporate body provides legally sufficient approval for the transaction? 0 Whether immediate disclosure of the transaction to the public and/or shareholders is required? 2 Whether disclosure of the transaction in published periodic filings (annual reports) is required? 2 Whether disclosure of the conflict of interest by Mr. James to the board of directors is required? 1 Whether an external body must review the terms of the transaction before it takes place? Extent of director liability index (0-10) 7 2 Whether shareholders can hold Mr. James liable for the damage that the Buyer-Seller transaction causes to the company? 0 Whether shareholders can hold the approving body (the CEO or board of directors) liable for the damage that the Buyer-Seller transaction causes to the company? 2 Whether a court can void the transaction upon a successful claim by a shareholder plaintiff? 1 Whether Mr. James pays damages for the harm caused to the company upon a successful claim by the shareholder plaintiff? 42 1 Whether Mr. James repays profits made from the transaction upon a successful claim by the shareholder plaintiff? 0 Whether fines and imprisonment can be applied against Mr. James? 1 Whether shareholders can sue directly or derivatively for the damage that the Buyer-Seller transaction causes to the company? Ease of shareholder suits index (0-10) 8 3 Whether the plaintiff can obtain any documents from the defendant and witnesses during trial? 2 Whether the plaintiff can directly question the defendant and witnesses during trial? 0 Whether the plaintiff can request categories of documents from the defendant without identifying specific ones? 1 Whether shareholders owning 10% or less of Buyer's shares can request an inspector to investigate the transaction? 1 Whether the level of proof required for civil suits is lower than that of criminal cases? 1 Whether shareholders owning 10% or less of Buyer's shares can inspect transaction documents before filing suit? Strength of investor protection index (0-10) 7.7 43 44 1. Benchmarking Paying Taxes Regulations: Kyrgyz Republic is ranked 150 overall for Paying Taxes. Ranking of Kyrgyz Republic in Paying Taxes - Compared to good practice and selected economies: 45 The following table shows Paying Taxes data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Payments Time (hours Total tax rate (number per per year) (% profit) Economies year) Maldives* 3 0 Timor-Leste 0.2 Selected Economy Kyrgyz Republic 48 202 57.2 Comparator Economies Kazakhstan 9 271 29.6 Moldova 48 228 30.9 Russian Federation 11 320 46.5 Tajikistan 54 224 86.0 Ukraine 135 657 55.5 * The following economies are also good practice economies for : Payments (number per year): Qatar 46 2. Historical data: Paying Taxes in Kyrgyz Republic Paying Taxes data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 156 150 Total tax rate (% profit) 61.4 61.4 59.4 57.2 Payments (number per year) 75 75 75 48 Time (hours per year) 202 202 202 202 3. The following graphs illustrate the Paying Taxes sub indicators in Kyrgyz Republic over the past 4 years: 47 Paying Taxes in Kyrgyz Republic The table below addresses the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year in Kyrgyz Republic, as well as measures of administrative burden in paying taxes. Tax or mandatory Payments Notes on Time Statutory tax Tax Totaltax rate Notes on contribution (number) Payments (hours) rate base (% profit) TTR Fuel tax 1 SOM 0.2 per number of liter liters Value added tax (VAT) 12 71 12.0% value added Tax on property 0 Moratoriu 1.0% property 0.00 (immovable) m value Tax on property 2 0.5% book value of 0.00 (movable) vehicles Land tax 4 SOM 2.9 per land area 0.10 square meter Medical insurance 0 paid jointly 2.0% gross salaries 2.30 contributions Corporate income tax 5 60 10.0% taxable 8.90 profits Pension fund 12 71 17.3% gross salaries 19.30 contributions Sales tax 12 1.5% or turnover 26.50 2.5% 48 Totals 48 202 57.2 49 50 1. Benchmarking Trading Across Borders Regulations: Kyrgyz Republic is ranked 156 overall for Trading Across Borders. Ranking of Kyrgyz Republic in Trading Across Borders - Compared to good practice and selected economies: 51 The following table shows Trading Across Borders data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Documents to Time to Cost to Documents to Time to Cost to export export (days) export (US$ import import (days) import (US$ Economies (number) per (number) per container) container) Denmark* 5 France 2 2 Malaysia 450 Singapore 4 439 Selected Economy Kyrgyz Republic 7 63 3010 7 72 3280 Comparator Economies Kazakhstan 10 81 3005 12 67 3055 Moldova 6 32 1765 7 35 1960 Russian Federation 8 36 1850 13 36 1850 Tajikistan 10 82 3350 9 83 4550 Ukraine 6 31 1560 8 36 1580 * The following economies are also good practice economies for : Time to export (days): Estonia 52 2. Historical data: Trading Across Borders in Kyrgyz Republic Trading Across Borders data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 155 156 Cost to export (US$ per container) 2500 3000 3000 3010 Cost to import (US$ per container) 2450 3250 3250 3280 Documents to export (number) 13 13 7 7 Documents to import (number) 13 13 7 7 Time to export (days) 64 64 63 63 Time to import (days) 75 75 72 72 3. The following graphs illustrate the Trading Across Borders sub indicators in Kyrgyz Republic over the past 4 years: 53 54 Trading Across Borders in Kyrgyz Republic These tables list the procedures necessary to import and export a standardized cargo of goods in Kyrgyz Republic. The documents required to export and import the goods are also shown. Nature of Export Procedures (2010) Duration (days) US$ Cost Documents preparation 23 210 Customs clearance and technical control 3 200 Ports and terminal handling 3 100 Inland transportation and handling 34 2500 Totals 63 3010 Nature of Import Procedures (2010) Duration (days) US$ Cost Documents preparation 25 310 Customs clearance and technical control 11 370 Ports and terminal handling 3 100 Inland transportation and handling 33 2500 Totals 72 3280 55 Documents for Export and Import Export Transit document (schedule of transit) Bill of lading Certificate of origin Commercial invoice Contract Customs export declaration Terminal handling receipts Import Transit document (schedule of transit) Terminal handling receipts Bill of lading Certificate of origin Commercial invoice Customs import declaration Certificate of conformity 56 57 1. Benchmarking Enforcing Contracts Regulations: Kyrgyz Republic is ranked 54 overall for Enforcing Contracts. Ranking of Kyrgyz Republic in Enforcing Contracts - Compared to good practice and selected economies: 58 The following table shows Enforcing Contracts data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Procedures Time (days) Cost (% of (number) claim) Economies Bhutan 0.1 Ireland 20 Singapore 150 Selected Economy Kyrgyz Republic 39 260 29.0 Comparator Economies Kazakhstan 38 390 22.0 Moldova 31 365 20.9 Russian Federation 37 281 13.4 Tajikistan 34 430 25.5 Ukraine 30 345 41.5 59 2. Historical data: Enforcing Contracts in Kyrgyz Republic Enforcing Contracts data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 54 54 Procedures (number) 39 39 39 39 Time (days) 260 260 260 260 Cost (% of claim) 29.0 29.0 29.0 29.0 3. The following graphs illustrate the Enforcing Contracts sub indicators in Kyrgyz Republic over the past 4 years: 60 Enforcing Contracts in Kyrgyz Republic This topic looks at the efficiency of contract enforcement in Kyrgyz Republic. Nature of Procedure (2010) Indicator Procedures (number) 39 Time (days) 260 Filing and service 20.0 Trial and judgment 90.0 Enforcement of judgment 150.0 Cost (% of claim)* 29.00 Attorney cost (% of claim) 7.0 Court cost (% of claim) 12.0 Enforcement Cost (% of claim) 10.0 61 Court information: Bishkek Inter-District Court on (" Economic Disputes ") * Claim assumed to be equivalent to 200% of income per capita. 62 63 1. Benchmarking Closing Business Regulations: Kyrgyz Republic is ranked 138 overall for Closing a Business. Ranking of Kyrgyz Republic in Closing Business - Compared to good practice and selected economies: 64 The following table shows Closing Business data for Kyrgyz Republic compared to good practice and comparator economies: Good Practice Recovery rate Time (years) Cost (% of (cents on the estate) Economies dollar) Ireland 0.4 Japan 92.7 Singapore* 1 Selected Economy Kyrgyz Republic 15.3 4.0 15 Comparator Economies Kazakhstan 43.3 1.5 15 Moldova 28.2 2.8 9 Russian Federation 25.3 3.8 9 Tajikistan 37.4 1.7 9 Ukraine 7.9 2.9 42 * The following economies are also good practice economies for : Cost (% of estate): Colombia, Kuwait, Norway 65 2. Historical data: Closing Business in Kyrgyz Republic Closing a Business data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 139 138 Time (years) 4.0 4.0 4.0 4.0 Cost (% of estate) 15 15 15 15 Recovery rate (cents on the dollar) 15.6 14.2 14.2 15.3 3. The following graphs illustrate the Closing Business sub indicators in Kyrgyz Republic over the past 4 years: 66 Since 2004 Doing Business has been tracking reforms aimed at simplifying business regulations, strengthening property rights, opening access to credit and enforcing contracts by measuring their impact on 10 indicator sets . * Nearly 1,000 reforms have had an impact on these indicators. Doing Business 2011, covering June 2009 to June 2010, reports that 117 economies implemented 216 reforms to make it easier to start a business. 64% of economies measured by Doing Business have reformed this year, focusing on easing business start-up, lightening the tax burden, simplifying import and export regulations and improving credit information systems. The top 10 most-improved in Doing Business 2011 Dealing with Construction Trading Across Borders Positive Change Registering Property Enforcing Contracts Protecting Investors Starting a Business Closing a Business Negative Change Getting Credit Paying Taxes Permits Economy Kazakhstan Rwanda Peru Vietnam Cape Verde Tajikistan Zambia Hungary Grenada Brunei Darussalam * For Doing Business 2011 the Employing Workers indicator is not included in the aggregate ease of doing business ranking. 67 Summary of changes to business regulation in top 10 most improved economies in Doing Business 2011 and selected comparator economies. Brunei Darussalam Brunei Darussalam made starting a business easier by improving efficiency at the company registrar and implementing an electronic system for name searches. Brunei Darussalam reduced the corporate income tax rate from 23.5% to 22% while also introducing a lower tax rate for small businesses, ranging from 5.5% to 11%. The introduction of an electronic customs system in Brunei Darussalam made trading easier. Cape Verde Cape Verde made start-up easier by eliminating the need for a municipal inspection before a business begins operations and computerizing the system for delivering the municipal license. Cape Verde eased property registration by switching from fees based on a percentage of the property value to lower fixed rates. Cape Verde abolished the stamp duties on sales and checks. Grenada Grenada eased business start-up by transferring responsibility for the commercial registry from the courts to the civil administration. The appointment of a registrar focusing only on property cut the time needed to transfer property in Grenada by almost half. Grenada's customs administration made trading faster by simplifying procedures, reducing inspections, improving staff training and enhancing communication with users. Hungary Hungary implemented a time limit for the issuance of building permits. Hungary reduced the property registration fee by 6% of the property value. Hungary simplified taxes and tax bases. Amendments to Hungary's bankruptcy law encourage insolvent companies to consider reaching agreements with creditors out of court so as to avoid bankruptcy. Kazakhstan Kazakhstan eased business start-up by reducing the minimum capital requirement to 100 tenge ($0.70) and eliminating the need to have the memorandum of association and company charter notarized. Kazakhstan made dealing with construction permits easier by implementing a one-stop shop related to technical conditions for utilities. Kazakhstan strengthened investor protections by requiring greater corporate disclosure in company annual reports. Kazakhstan speeded up trade through efforts to modernize customs, including implementation of a risk management system and improvements in customs automation. Kyrgyz Republic The Kyrgyz Republic eased business start-up by eliminating the requirement to have the signatures of company founders notarized. The Kyrgyz Republic streamlined insolvency proceedings and updated requirements for administrators, but new formalities added to prevent abuse of proceedings made closing a business more difficult. Moldova Moldova reduced employer contribution rates for social security. Peru Peru eased business start-up by simplifying the requirements for operating licenses and creating an online one-stop shop for business registration. Peru streamlined construction permitting by implementing administrative reforms. Peru introduced fast-track procedures at the land registry, cutting by half the time needed to register property. Peru made trading easier by implementing a new web-based electronic data interchange system, risk-based inspections and payment deferrals. Russian Federation Russia eased construction permitting by implementing a single window for all procedures related to land use. Russia introduced a series of legislative measures in 2009 to improve creditor rights and the insolvency system. Rwanda Rwanda made dealing with construction permits easier by passing new building regulations at the end of April 2010 and implementing new time limits for the issuance of various permits. Rwanda enhanced access to credit by allowing borrowers the right to inspect their own credit report and mandating that loans of all sizes be reported to the central bank's public credit registry. Rwanda reduced the number of trade documents required and enhanced its joint border management procedures with Uganda and other neighbors, leading to an improvement in the trade logistics environment. Tajikistan Tajikistan made starting a business easier by creating a one-stop shop that consolidates registration with the state and the tax authority. Tajikistan strengthened investor protections by requiring greater corporate disclosure in the annual report and greater access to corporate information for minority investors. Tajikistan lowered its corporate income tax rate. 68 Ukraine Ukraine eased business start-up by substantially reducing the minimum capital requirement. Ukraine made dealing with construction permits easier by implementing national and local regulations that streamlined procedures. Ukraine eased tax compliance by introducing and continually enhancing an electronic filing system for value added tax. Vietnam Vietnam eased company start-up by creating a one-stop shop that combines the processes for obtaining a business license and tax license and by eliminating the need for a seal for company licensing. Vietnam made dealing with construction permits easier by reducing the cost to register newly completed buildings by 50% and transferring the authority to register buildings from local authorities to the Department of National Resources and Environment. Vietnam improved its credit information system by allowing borrowers to examine their own credit report and correct errors. Zambia Zambia eased business start-up by eliminating the minimum capital requirement. Zambia eased trade by implementing a one-stop border post with Zimbabwe, launching web-based submission of customs declarations and introducing scanning machines at border posts. Zambia improved contract enforcement by introducing an electronic case management system in the courts that provides electronic referencing of cases, a database of laws, real-time court reporting and public access to court records. 69 70