58739 Grenada © 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. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, USA; telephone 978-750-8400; fax 978-750-4470; Internet www.copyright.com. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher,The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax 202-522-2422; e-mail pubrights@worldbank.org. Additional copies of Doing Business 2011: Making a Difference for Entrepreneurs, Doing Business 2010: Reforming through Difficult Times, Doing Business 2009, Doing Business 2008, Doing Business 2007: How to Reform, Doing Business in 2006: Creating Jobs, Doing Business in 2005: Removing Obstacles to Growth and Doing Business in 2004:Understanding Regulations may be purchased at www.doingbusiness.org. 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 Grenada. 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 Grenada is ranked 92 out of 183 economies. Singapore is the top ranked economy in the Ease of Doing Business. Grenada - Compared to global good practice economy as well as selected economies: Grenada's ranking in Doing Business 2011 Rank Doing Business 2011 Ease of Doing Business 92 Starting a Business 49 Dealing with Construction Permits 15 Registering Property 145 Getting Credit 89 Protecting Investors 28 Paying Taxes 79 Trading Across Borders 57 Enforcing Contracts 161 Closing a Business 183 2 Summary of Indicators - Grenada Starting a Business Procedures (number) 6 Time (days) 15 Cost (% of income per capita) 25.2 Min. capital (% of income per capita) 0.0 Dealing with Construction Permits Procedures (number) 10 Time (days) 149 Cost (% of income per capita) 25.9 Registering Property Procedures (number) 8 Time (days) 47 Cost (% of property value) 7.4 Getting Credit Strength of legal rights index (0-10) 8 Depth of credit information index (0-6) 0 Public registry coverage (% of adults) 0.0 Private bureau coverage (% of adults) 0.0 Protecting Investors Extent of disclosure index (0-10) 4 Extent of director liability index (0-10) 8 Ease of shareholder suits index (0-10) 7 Strength of investor protection index (0-10) 6.3 Paying Taxes Payments (number per year) 30 Time (hours per year) 140 Profit tax (%) 27.6 Labor tax and contributions (%) 5.6 Other taxes (%) 12.1 Total tax rate (% profit) 45.3 Trading Across Borders Documents to export (number) 6 Time to export (days) 10 Cost to export (US$ per container) 876 Documents to import (number) 5 Time to import (days) 15 Cost to import (US$ per container) 2129 3 Enforcing Contracts Procedures (number) 47 Time (days) 688 Cost (% of claim) 32.6 Closing a Business Recovery rate (cents on the dollar) 0.0 Time (years) no practice Cost (% of estate) no practice 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 0.020 0.018 0.016 Doing business has become 0.014 easier (DB change 0.012 score) 0.010 0.008 0.006 0.004 St. Vincent Antigua and Grenada Jamaica Dominica St. Kitts and and the Barbuda Nevis Grenadines 6 1. Benchmarking Starting a Business Regulations: Grenada is ranked 49 overall for Starting a Business. Ranking of Grenada in Starting a Business - Compared to good practice and selected economies: 7 The following table shows Starting a Business data for Grenada 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 Grenada 6 15 25.2 0.0 Comparator Economies Antigua and Barbuda 8 21 11.0 0.0 Dominica 5 14 22.0 0.0 Jamaica 6 8 5.2 0.0 St. Kitts and Nevis 7 19 11.3 0.0 St. Vincent and the 7 10 21.2 0.0 Grenadines * 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 Grenada Starting a Business data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 54 49 Procedures (number) 6 6 6 6 Time (days) 20 20 20 15 Cost (% of income per capita) 31.7 30.2 24.6 25.2 Min. capital (% of income per capita) 0.0 0.0 0.0 0.0 3. The following graphs illustrate the Starting a Business sub indicators in Grenada over the past 4 years: 9 Starting a Business Summary - Grenada This table summarizes the procedures and costs associated with setting up a business in Grenada. STANDARDIZED COMPANY Legal Form: Private Limited Liability Company City: St. George's Registration Requirements: No: Procedure Time to complete Cost to complete 1 Search and reserve company name 3 XCD 10 2 Prepare and notarize company statutes 2 XCD 2,500 3 Register with Supreme Court Registry and receive company 5 XCD 1,200 certificate; register with Internal Revenue Department and National Insurance Scheme 4 Register for taxes 2 no charge 5 Register for social security 1 no charge 6 * Make company seal 2 XCD 75 * Takes place simultaneously with another procedure. 10 Starting a Business Details - Grenada Procedure 1 Search and reserve company name Time to complete: 3 Cost to complete: XCD 10 Comment: To search and reserve a company name, the company must submit a business registration application along with the articles of incorporation, the notice of address, the notice of directors, and the request for company name search. Procedure 2 Prepare and notarize company statutes Time to complete: 2 Cost to complete: XCD 2,500 Comment: The amount charged to prepare and notarize company statutes is the registrar's submission fee. Procedure 3 Register with Supreme Court Registry and receive company certificate; register with Internal Revenue Department and National Insurance Scheme Time to complete: 5 Cost to complete: XCD 1,200 Comment: The Corporate Affairs and Intellectual Property Act No. 19 of 2009 dated October 15th, 2009 has established the Corporate and Deeds Registry as a separate entity from the Supreme Court Registry where entrepreneur used to file a statement of particulars. This has resulted in shorter times for registration of a company. Procedure 4 Register for taxes Time to complete: 2 Cost to complete: no charge Comment: After the form is completed at the tax authority, the tax number is issued the next day. Procedure 5 Register for social security Time to complete: 1 Cost to complete: no charge Comment: Employee registration for social security is completed within a day of submitting the required forms at the National Insurance Scheme (NIS). Procedure 6 Make company seal Time to complete: 2 11 Cost to complete: XCD 75 Comment: 12 13 1. Benchmarking Dealing with Construction Permits Regulations: Grenada is ranked 15 overall for Dealing with Construction Permits. Ranking of Grenada in Dealing with Construction Permits - Compared to good practice and selected economies: 14 The following table shows Dealing with Construction Permits data for Grenada 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 Grenada 10 149 25.9 Comparator Economies Antigua and Barbuda 13 156 24.2 Dominica 13 182 11.0 Jamaica 10 156 258.3 St. Kitts and Nevis 14 67 4.8 St. Vincent and the 11 74 7.0 Grenadines 15 2. Historical data: Dealing with Construction Permits in Grenada Dealing with Construction Permits data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 15 15 Procedures (number) 10 10 10 10 Time (days) 149 149 149 149 Cost (% of income per capita) 31.0 31.1 25.3 25.9 3. The following graphs illustrate the Dealing with Construction Permits sub indicators in Grenada over the past 4 years: 16 Dealing with Construction Permits in Grenada The table below summarizes the procedures, time, and costs to build a warehouse in Grenada. BUILDING A WAREHOUSE City: St. George's Registration Requirements: No: Procedure Time to complete Cost to complete 1 Obtain location plan from Land and Survey Office 1 day no charge 2 Obtain Development Permit from Land Development Control Authority 90 days XCD 3,000 3 Request and receive final inspection from the Land Development Control 15 days XCD 170 Authority 4 Obtain Certificate of Occupancy form the Land Development Control 7 days XCD 5 Authority 5 Receive electricity inspection and obtain electricity inspection certificate 1 day no charge -internal wiring 6 Obtain electricity service 35 days XCD 350 7 * Request water service 1 day no charge 8 * Receive water inspection 1 day no charge 17 9 * Obtain Water and Sewage Connection 7 days XCD 120 10 * Obtain Fixed Telephone Line 7 days XCD 250 * Takes place simultaneously with another procedure. 18 Dealing with Construction Permits Details - Grenada Procedure 1 Obtain location plan from Land and Survey Office Time to complete: 1 day Cost to complete: no charge Agency: Land and Survey Office Comment: According to Article 110.2 of the Grenada Building Code, a location plan showing "the name and position of the existing roads and fixed and easily identifiable points such as streams, road junctions, bridges, and nearby houses" must be obtained from the Lands and Survey Office before application for a development permit. Procedure 2 Obtain Development Permit from Land Development Control Authority Time to complete: 90 days Cost to complete: XCD 3,000 Agency: Land Development Control Authority Comment: The Land Development Control Authority sends copies of the documents to the Ministry of Health, Ministry of Works, a structural engineer, and an architect at Physical Planning Unit (PPU). All these bodies review the plans and send recommendations to the PPU, which then prepares a report to the Development Control Authority (DCA). The DCA (its board) meets to decide whether the plan passed or failed. If it failed, comments are sent to the applicant for resubmission. If it passed, the permit is issued and construction can begin. If nothing is built on the site for a year, the applicant must resubmit the application. XCD 3,000 is a flat fee for industrial buildings. Procedure 3 Request and receive final inspection from the Land Development Control Authority Time to complete: 15 days Cost to complete: XCD 170 Agency: Land Development Control Authority Comment: The Land Development Control Authority must inspect the warehouse upon completion of construction. The final inspection to obtain the certificate of occupancy shall not take place "until the necessary certificates of approval in respect of electrical works have been issued by the Electrical Inspector." Procedure 4 Obtain Certificate of Occupancy form the Land Development Control Authority Time to complete: 7 days Cost to complete: XCD 5 Agency: Land Development Control Authority Comment: According to Article 115 of the Grenada Building Code, a new building "shall not be occupied or a change made in occupancy or the nature of the use of a building or part of a building changed until after the Authority has issued a certificate of occupancy." 19 Procedure 5 Receive electricity inspection and obtain electricity inspection certificate -internal wiring Time to complete: 1 day Cost to complete: no charge Agency: GRENLEC (Grenada Electricity Services Ltd) Comment: Electrical inspector will check internal wiring of the warehouse. He will issue a clearance on the spot. This clearance is needed by GRENLEC in order to connect the warehouse to the main grid. Procedure 6 Obtain electricity service Time to complete: 35 days Cost to complete: XCD 350 Agency: GRENLEC (Grenada Electricity Services Ltd) Comment: The flat fee for industrial connections is XCD 350. Procedure 7 Request water service Time to complete: 1 day Cost to complete: no charge Agency: National Water and Sewage Authority (NAWASA) Comment: In St. George's, most buildings connect to the sewerage system. Outside of St. George's, septic tanks are used. Procedure 8 Receive water inspection Time to complete: 1 day Cost to complete: no charge Agency: National Water and Sewage Authority (NAWASA) Comment: In St. George's, most buildings connect to the sewerage system. Outside of St. George's, septic tanks are used. Procedure 9 Obtain Water and Sewage Connection Time to complete: 7 days Cost to complete: XCD 120 Agency: National Water and Sewage Authority (NAWASA) Comment: In St. George's, most buildings connect to the sewerage system. Outside of St. George's, septic tanks are used. 20 Procedure 10 Obtain Fixed Telephone Line Time to complete: 7 days Cost to complete: XCD 250 Agency: Grenada Cable and Wireless Comment: 21 22 1. Benchmarking Registering Property Regulations: Grenada is ranked 145 overall for Registering Property. Ranking of Grenada in Registering Property - Compared to good practice and selected economies: 23 The following table shows Registering Property data for Grenada 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 Grenada 8 47 7.4 Comparator Economies Antigua and Barbuda 7 26 10.9 Dominica 5 42 13.7 Jamaica 6 37 7.5 St. Kitts and Nevis 6 81 13.3 St. Vincent and the 7 38 11.9 Grenadines * The following economies are also good practice economies for : Procedures (number): United Arab Emirates Time (days): Saudi Arabia, Thailand, United Arab Emirates 24 2. Historical data: Registering Property in Grenada Registering Property data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 163 145 Procedures (number) 8 8 8 8 Time (days) 77 77 77 47 Cost (% of property value) 7.4 7.4 7.4 7.4 3. The following graphs illustrate the Registering Property sub indicators in Grenada over the past 4 years: 25 Registering Property in Grenada This topic examines the steps, time, and cost involved in registering property in Grenada. STANDARDIZED PROPERTY Property Value: 751,226.48 City: St. George's Registration Requirements: No: Procedure Time to complete Cost to complete 1 * Lawyer prepares title deed 5 days (simultaneous 1­2% property value with procedures 2, 3, and 4) 2 * Title search at the Deeds & Land Registry 5 days (simultaneous EC $200 with procedures 1, 3, and 4) 3 * Obtain tax clearance from Inland Revenue 1-2 days (simultaneous no cost with procedures 1, 2, and 4) 4 * Obtain clearance from National Water and Sewage up to 14 days no cost Authority (simultaneous with procedures 1, 2, and 3) 5 Payment of transfer fee at Inland Revenue 1 day 5% (property value minus $20000, exempted) 6 Execution of the deed at the lawyer's office 1 day (lawyer's fees paid in procedure 1) 26 7 Payment of Stamp Duty at the Deeds & Land 1 day 1% of property value Registry 8 Registration of the deed in the Deeds & Land 30 days EC $5 (registration fee) Registry * Takes place simultaneously with another procedure. 27 Registering Property Details - Grenada Procedure 1 Lawyer prepares title deed Time to complete: 5 days (simultaneous with procedures 2, 3, and 4) Cost to complete: 1­2% property value Comment: The purchaser's lawyer prepares the title deed and ensures that all rates and taxes are paid by the vendor. Water rates are paid to the National Water and Sewerage Authority, and property tax and property transfer tax are paid by the vendor to the Department of Inland Revenue, Ministry of Finance. The purchaser pays lawyer's fees at this point. Procedure 2 Title search at the Deeds & Land Registry Time to complete: 5 days (simultaneous with procedures 1, 3, and 4) Cost to complete: EC $200 Agency: Deeds & Land Registry Comment: The lawyer conducts searches on the vendor's title deed for the last 10 years, in addition to previous owners, going back as far as 60 years. The lawyer also searches the wills under the previous owner and any judgments against the property for the last 12 years. Procedure 3 Obtain tax clearance from Inland Revenue Time to complete: 1-2 days (simultaneous with procedures 1, 2, and 4) Cost to complete: no cost Agency: Inland Revenue Office Comment: Procedure 4 Obtain clearance from National Water and Sewage Authority Time to complete: up to 14 days (simultaneous with procedures 1, 2, and 3) Cost to complete: no cost Agency: National Water and Sewage Authority Comment: The lawyer sends a written request to the National Water and Sewage Authority in order to obtain clearance that all water rates and taxes have been paid. It can take about 2 weeks in order to receive clearance from the National Water and Sewage Authority. Procedure 5 Payment of transfer fee at Inland Revenue Time to complete: 1 day 28 Cost to complete: 5% (property value minus $20000, exempted) Agency: Inland Revenue Office Comment: Procedure 6 Execution of the deed at the lawyer's office Time to complete: 1 day Cost to complete: (lawyer's fees paid in procedure 1) Comment: The deed is executed in the presence of the lawyer and the cheque is exchanged for the deed. All previous deeds relating to the land, all papers (including insurance policy), and all keys are delivered to the purchaser. Procedure 7 Payment of Stamp Duty at the Deeds & Land Registry Time to complete: 1 day Cost to complete: 1% of property value Agency: Deeds & Land Registry Comment: Procedure 8 Registration of the deed in the Deeds & Land Registry Time to complete: 30 days Cost to complete: EC $5 (registration fee) Agency: Deeds & Land Registry Comment: The deed is collected by the purchaser's lawyer after registration and processing. Documentation required: - Original deed - New deed (with stamps from procedure 7) - Proof of payment of all taxes and rates relating to the property - History of title 29 30 1. Benchmarking Getting Credit Regulations: Grenada is ranked 89 overall for Getting Credit. Ranking of Grenada in Getting Credit - Compared to good practice and selected economies: 31 The following table shows Getting Credit data for Grenada 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 Grenada 8 0 0.0 0.0 Comparator Economies Antigua and Barbuda 7 0 0.0 0.0 Dominica 9 0 0.0 0.0 Jamaica 8 0 0.0 0.0 St. Kitts and Nevis 7 0 0.0 0.0 St. Vincent and the 7 0 0.0 0.0 Grenadines * 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. 32 2. Historical data: Getting Credit in Grenada Getting Credit data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 87 89 Strength of legal rights index (0-10) 8 8 8 8 Depth of credit information index (0-6) 0 0 0 0 Private bureau coverage (% of adults) 0.0 0.0 0.0 0.0 Public registry coverage (% of adults) 0.0 0.0 0.0 0.0 3. The following graphs illustrate the Getting Credit sub indicators in Grenada over the past 4 years: 33 Getting Credit in Grenada The following table summarize legal rights of borrowers and lenders, and the availability and legal framework of credit registries in Grenada. Getting Credit Indicators (2010) Indicator Private credit Public credit Private bureau coverage (% of adults) 0 bureau registry Are data on both firms and individuals distributed? No No 0 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? No No 0 Is it guaranteed by law that borrowers can inspect their data in the No No 0 largest credit registry? Coverage 0.0 0.0 Number of individuals 0 0 Number of firms 0 0 34 Strength of legal rights index (0-10) 8 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? No 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? No 35 36 1. Benchmarking Protecting Investors Regulations: Grenada is ranked 28 overall for Protecting Investors. Ranking of Grenada in Protecting Investors - Compared to good practice and selected economies: 37 The following table shows Protecting Investors data for Grenada compared to good practice and comparator economies: Good Practice Strength of investor Economies protection index (0-10) New Zealand 9.7 Selected Economy Grenada 6.3 Comparator Economies Antigua and Barbuda 6.3 Dominica 6.3 Jamaica 5.3 St. Kitts and Nevis 6.3 St. Vincent and the 6.3 Grenadines 38 2. Historical data: Protecting Investors in Grenada Protecting Investors data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 27 28 Strength of investor protection index (0-10) 6.3 6.3 6.3 6.3 3. The following graph illustrates the Protecting Investors index in Grenada compared to best practice and selected Economies: 9.7 6.3 6.3 6.3 6.3 6.3 5.3 a d ic ud nd nd da ev an a in c rb a a na he t ai na a om re d t cen N tts al m a Ba igu re Ze i is D Ja .K an in G nt .V s ew St ne A St N di G Note: The higher the score, the greater the investor protection. 39 Protecting Investors in Grenada The table below provides a full breakdown of how the disclosure, director liability, and shareholder suits indexes are calculated in Grenada. Protecting Investors Data (2010) Indicator Extent of disclosure index (0-10) 4 1 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? 1 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? 0 Whether an external body must review the terms of the transaction before it takes place? Extent of director liability index (0-10) 8 2 Whether shareholders can hold Mr. James liable for the damage that the Buyer-Seller transaction causes to the company? 2 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? 1 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? 40 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) 7 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? 1 Whether the plaintiff can request categories of documents from the defendant without identifying specific ones? 0 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? 0 Whether shareholders owning 10% or less of Buyer's shares can inspect transaction documents before filing suit? Strength of investor protection index (0-10) 6.3 41 42 1. Benchmarking Paying Taxes Regulations: Grenada is ranked 79 overall for Paying Taxes. Ranking of Grenada in Paying Taxes - Compared to good practice and selected economies: 43 The following table shows Paying Taxes data for Grenada 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 Grenada 30 140 45.3 Comparator Economies Antigua and Barbuda 56 207 41.5 Dominica 38 120 37.0 Jamaica 72 414 50.1 St. Kitts and Nevis 24 155 52.7 St. Vincent and the 32 111 38.7 Grenadines * The following economies are also good practice economies for : Payments (number per year): Qatar 44 2. Historical data: Paying Taxes in Grenada Paying Taxes data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 79 79 Total tax rate (% profit) 45.3 45.3 45.3 45.3 Payments (number per year) 30 30 30 30 Time (hours per year) 140 140 140 140 3. The following graphs illustrate the Paying Taxes sub indicators in Grenada over the past 4 years: 45 Paying Taxes in Grenada The table below addresses the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year in Grenada, 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 Sales tax 12 36 10.0% sales Tax on check 1 10 cents per cheque 0.00 transactions Vehicle tax 1 fixed value 0.10 Property tax 1 0.3% and property 0.30 0.2% value Property transfer tax 1 5.0% sale price 2.90 minus EC20,000 Social security 12 96 5.0% gross salaries 5.60 contributions Stamp tax on sales 1 0.5% sales 8.80 Corporate income tax 1 8 30.0% taxable profit 27.60 Totals 30 140 45.3 46 47 1. Benchmarking Trading Across Borders Regulations: Grenada is ranked 57 overall for Trading Across Borders. Ranking of Grenada in Trading Across Borders - Compared to good practice and selected economies: 48 The following table shows Trading Across Borders data for Grenada 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 Grenada 6 10 876 5 15 2129 Comparator Economies Antigua and Barbuda 5 15 1133 5 15 1633 Dominica 7 13 1297 8 15 1310 Jamaica 6 21 1750 6 22 1420 St. Kitts and Nevis 4 12 850 5 13 2138 St. Vincent and the 5 12 1075 4 12 1605 Grenadines * The following economies are also good practice economies for : Time to export (days): Estonia 49 2. Historical data: Trading Across Borders in Grenada Trading Across Borders data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 82 57 Cost to export (US$ per container) 915 1226 1226 876 Cost to import (US$ per container) 2179 2479 2479 2129 Documents to export (number) 6 6 6 6 Documents to import (number) 5 5 5 5 Time to export (days) 19 16 14 10 Time to import (days) 23 20 19 15 3. The following graphs illustrate the Trading Across Borders sub indicators in Grenada over the past 4 years: 50 51 Trading Across Borders in Grenada These tables list the procedures necessary to import and export a standardized cargo of goods in Grenada. The documents required to export and import the goods are also shown. Nature of Export Procedures (2010) Duration (days) US$ Cost Documents preparation 5 134 Customs clearance and technical control 1 68 Ports and terminal handling 3 500 Inland transportation and handling 1 174 Totals 10 876 Nature of Import Procedures (2010) Duration (days) US$ Cost Documents preparation 7 386 Customs clearance and technical control 3 1068 Ports and terminal handling 3 500 Inland transportation and handling 2 175 Totals 15 2129 52 Documents for Export and Import Export Bill of lading Certificate of origin Commercial invoice Customs export declaration Export license Packing list Import Bill of lading Certificate of origin Commercial invoice Customs import declaration Packing list 53 54 1. Benchmarking Enforcing Contracts Regulations: Grenada is ranked 161 overall for Enforcing Contracts. Ranking of Grenada in Enforcing Contracts - Compared to good practice and selected economies: 55 The following table shows Enforcing Contracts data for Grenada 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 Grenada 47 688 32.6 Comparator Economies Antigua and Barbuda 45 351 22.7 Dominica 47 681 36.0 Jamaica 35 655 45.6 St. Kitts and Nevis 47 578 20.5 St. Vincent and the 45 394 30.3 Grenadines 56 2. Historical data: Enforcing Contracts in Grenada Enforcing Contracts data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 161 161 Procedures (number) 47 47 47 47 Time (days) 723 723 688 688 Cost (% of claim) 32.6 32.6 32.6 32.6 3. The following graphs illustrate the Enforcing Contracts sub indicators in Grenada over the past 4 years: 57 Enforcing Contracts in Grenada This topic looks at the efficiency of contract enforcement in Grenada. Nature of Procedure (2010) Indicator Procedures (number) 47 Time (days) 688 Filing and service 28.0 Trial and judgment 460.0 Enforcement of judgment 200.0 Cost (% of claim)* 32.60 Attorney cost (% of claim) 22.1 Court cost (% of claim) 3.1 Enforcement Cost (% of claim) 7.4 58 Court information: Eastern Caribbean Supreme Court, St. George's High Court of Justice * Claim assumed to be equivalent to 200% of income per capita. 59 60 1. Benchmarking Closing Business Regulations: Grenada is ranked 183 overall for Closing a Business. Ranking of Grenada in Closing Business - Compared to good practice and selected economies: 61 The following table shows Closing Business data for Grenada 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 Grenada 0.0 no practice no practice Comparator Economies Antigua and Barbuda 36.7 3.0 7 Dominica 0.0 no practice no practice Jamaica 65.1 1.1 18 St. Kitts and Nevis 0.0 no practice no practice St. Vincent and the 0.0 no practice no practice Grenadines * The following economies are also good practice economies for : Cost (% of estate): Colombia, Kuwait, Norway 62 2. Historical data: Closing Business in Grenada Closing a Business data Doing Business Doing Business Doing Business Doing Business 2008 2009 2010 2011 Rank .. .. 183 183 Time (years) no practice no practice no practice no practice Cost (% of estate) no practice no practice no practice no practice Recovery rate (cents on the dollar) 0.0 0.0 0.0 0.0 3. The following graphs illustrate the Closing Business sub indicators in Grenada over the past 4 years: 63 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. 64 Summary of changes to business regulation in top 10 most improved economies in Doing Business 2011 and selected comparator economies. Antigua and Barbuda In Antigua and Barbuda, to transfer property now requires clearance by the chief surveyor to avoid mischievous declarations. 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. Jamaica Jamaica eased the transfer of property by lowering transfer taxes and fees, offering expedited registration procedures and making information from the company registrar available online. 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. 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. 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. 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. 65 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. 66 67