Doing Business 2018 San Marino Economy Pro le of San Marino Doing Business 2018 Indicators (in order of appearance in the document) Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company Dealing with construction Procedures, time and cost to complete all formalities to build a warehouse and the quality control and permits safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply and the transparency of tariffs Registering property Procedures, time and cost to transfer a property and the quality of the land administration system Getting credit Movable collateral laws and credit information systems Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes Trading across borders Time and cost to export the product of comparative advantage and import auto parts Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency Labor market regulation Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. Page 2   for insolvency Doing Business Labor market 2018 regulation San Marino Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting the aggregate distance to frontier scores, rounded to two decimals. More about Doing Business (PDF, 5MB) Ease of Doing Business in Region Europe & Central Asia DB 2018 Rank 190 1 San Marino Income Category High income 93 Population 33,203 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 46,447 0 100 62.47 City Covered San Marino DB 2018 Distance to Frontier (DTF) 0 100 72.70: Italy (Rank: 46) 71.63: Cyprus (Rank: 53) 71.33: Regional Average (Europe & Central Asia) 68.02: Greece (Rank: 67) 64.72: Malta (Rank: 84) Page 3   62.47: San Marino (Rank: 93) aggregate distance to frontier scores, rounded to two decimals. More Doingabout 2018 (PDF, Doing Business Business San 5MB) Marino Ease of Doing Business in Region Europe & Central Asia DB 2018 Rank 190 1 San Marino Income Category High income 93 Population 33,203 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 46,447 0 100 62.47 City Covered San Marino DB 2018 Distance to Frontier (DTF) 0 100 72.70: Italy (Rank: 46) 71.63: Cyprus (Rank: 53) 71.33: Regional Average (Europe & Central Asia) 68.02: Greece (Rank: 67) 64.72: Malta (Rank: 84) 62.47: San Marino (Rank: 93) Note: The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. Rankings on Doing Business topics - San Marino 1 14 20 28 40 55 68 78 78 82 Rank 112 109 109 136 163 175 183 190 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Investors Borders Permits Distance to Frontier (DTF) on Doing Business topics - San Marino 97.48 100 90.63 83.65 82.32 80 71.20 65.68 59.25 60 DTF 39.48 40 30.00 20 5.00 0 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:0.00 Change:-0.01 Change:0.00 Investors Change:0.00 Borders Change:0.00 Change:0.00 Change:-0.10 Permits Change:0.00 Change:0.00 Change:-0.23 Starting a Business Page 4   This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:0.00 Change:-0.01 Change:0.00 Investors Change:0.00 Borders Change:0.00 Change:0.00 Change:-0.10 Permits Change:0.00 Change:0.00 Doing Business 2018 San Marino Change:-0.23 Starting a Business This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized limited liability company to start up and formally operate in economy’s largest business city. To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scores obtained for each of the component indicators. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally start and operate a To make the data comparable across economies, several assumptions company (number) about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay Pre-registration (for example, name verification no bribes. or reservation, notarization) Registration in economy’s largest business city The business: - Is a limited liability company (or its legal equivalent). If there is more than Post-registration (for example, social security one type of limited liability company in the economy, the most common registration, company seal) among domestic rms is chosen. Information on the most common form is Obtaining approval from spouse to start business obtained from incorporation lawyers or the statistical o ce. or leave home to register company - Operates in the economy’s largest business city and the entire o ce Obtaining any gender-specific permission that space is approximately 929 square meters (10,000 square feet). For 11 can impact company registration, company economies the data are also collected for the second largest business city. operations and process of getting national - Is 100% domestically owned and has ve owners, none of whom is a legal identity card entity; and has a start-up capital of 10 times income per capita and has a Time required to complete each procedure turnover of at least 100 times income per capita. (calendar days) - Performs general industrial or commercial activities, such as the production or sale of goods or services to the public. The business does Does not include time spent gathering not perform foreign trade activities and does not handle products subject information to a special tax regime, for example, liquor or tobacco. It does not use Each procedure starts on a separate day (2 heavily polluting production processes. procedures cannot start on the same day) - Leases the commercial plant or o ces and is not a proprietor of real Procedures fully completed online are recorded estate and the amount of the annual lease for the o ce space is equivalent as ½ day to 1 times income per capita. Procedure is considered completed once final - Does not qualify for investment incentives or any special bene ts. document is received - Has at least 10 and up to 50 employees one month after the commencement of operations, all of whom are domestic nationals. No prior contact with officials - Has a company deed 10 pages long. Cost required to complete each procedure (% of The owners: income per capita) - Have reached the legal age of majority. If there is no legal age of majority, Official costs only, no bribes they are assumed to be 30 years old. No professional fees unless services required by - Are sane, competent, in good health and have no criminal record. law or commonly used in practice - Are married and the marriage is monogamous and registered with the authorities. Paid-in minimum capital (% of income per capita) - Where the answer di ers according to the legal system applicable to the Funds deposited in a bank or with third party woman or man in question (as may be the case in economies where there before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Standardized Company Page 5   before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Doing Business 2018 San Marino Standardized Company Legal form Limited Liability Company Paid-in minimum capital requirement EUR 12,750 City Covered San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Procedure – Men (number) 8 5.2 4.9 1.00 (New Zealand) Time – Men (days) 12.5 10.1 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 9.1 4.4 3.1 0.00 (United Kingdom) Procedure – Women (number) 8 5.2 4.9 1.00 (New Zealand) Time – Women (days) 12.5 10.1 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 9.1 4.4 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 30.4 3.4 8.7 0.00 (113 Economies) Figure – Starting a Business in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 92.30: Greece (Rank: 37) 91.19: Cyprus (Rank: 50) 90.62: Regional Average (Europe & Central Asia) 89.42: Italy (Rank: 66) 84.83: Malta (Rank: 102) 83.65: San Marino (Rank: 112) Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores for starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Starting a Business in San Marino – Procedure, Time and Cost Time Cost 6 12 5 10 ost (% of income per capita) 4 8 Time (days) 6 3 4 2 Page 6   starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 San Marino Figure – Starting a Business in San Marino – Procedure, Time and Cost Time Cost 6 12 5 10 Cost (% of income per capita) 4 8 Time (days) 6 3 4 2 2 1 0 0 1 2 3 4 5 6 7 8 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Details – Starting a Business in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Check for Company name 1 day no charge Agency : Cancelleria Commerciale – Tribunale (Commercial Chancery – Tribunal) A notary conducts a Company name search at the Cancelleria Commerciale – Tribunale (Commercial Chancery – Tribunal) to make sure there isn’t already a company registered with the same name. 2 Register Company Act at the Register o ce 1 day EUR 10 (stamp duty Agency : U cio del Registro e delle Ipoteche – Segreteria di Stato per le for certificate of Finanze e il Bilancio good standing) + EUR 10 (stamp duty The following documents (all self-certi ed) are provided to a notary: for certificate used For legal entities: to revoke the license) - certi cate of good standing + EUR 1,050 (notary - certi cate used to revoke the license fee and stamp duty Stamp duty of EUR 10 applies for every four pages. for companies act) + EUR 600 (register A notary then prepares two copies of the company act (EUR 1000 as notary tax) + EUR 350 fee + EUR 50 stamp duty, based on EUR 10 for every four pages and company (judicial tax) act being 10 pages) and submits all the documentation to the U cio del Registro e delle Ipoteche (Registry O ce). 3 Register Company at the Commercial Chancery 5 days EUR 70 Agency : Cancelleria Commerciale – Tribunale (Commercial Chancery – Tribunal) Page 7   A notary delivers the Company Act to the Cancelleria Commerciale. (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Doing Business 2018 San Marino Details – Starting a Business in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Check for Company name 1 day no charge Agency : Cancelleria Commerciale – Tribunale (Commercial Chancery – Tribunal) A notary conducts a Company name search at the Cancelleria Commerciale – Tribunale (Commercial Chancery – Tribunal) to make sure there isn’t already a company registered with the same name. 2 Register Company Act at the Register o ce 1 day EUR 10 (stamp duty Agency : U cio del Registro e delle Ipoteche – Segreteria di Stato per le for certificate of Finanze e il Bilancio good standing) + EUR 10 (stamp duty The following documents (all self-certi ed) are provided to a notary: for certificate used For legal entities: to revoke the license) - certi cate of good standing + EUR 1,050 (notary - certi cate used to revoke the license fee and stamp duty Stamp duty of EUR 10 applies for every four pages. for companies act) + EUR 600 (register A notary then prepares two copies of the company act (EUR 1000 as notary tax) + EUR 350 fee + EUR 50 stamp duty, based on EUR 10 for every four pages and company (judicial tax) act being 10 pages) and submits all the documentation to the U cio del Registro e delle Ipoteche (Registry O ce). 3 Register Company at the Commercial Chancery 5 days EUR 70 Agency : Cancelleria Commerciale – Tribunale (Commercial Chancery – Tribunal) A notary delivers the Company Act to the Cancelleria Commerciale. 4 Obtain company title certi cate 2 days EUR 50 Agency : Casellario Giudiziario – Tribunale (Judicial registry – Tribunal) The notary, or his nominee, submits a written request by fax to the Commercial Chancellery for the Certi cato di Vigenza (company title certi cate). After two days the certi cate is issued and it can be picked up at the o ce. This certi cation con rms the status of the company, highlighting the name, the date and number of registration, the corporate bodies, the corporate purpose and the powers of directors under the articles of association. 5 Obtain operator code Less than one day no charge Agency : U cio Industria, Artigianato e Commercio (online procedure) The owner of the company needs to apply for a business license – phase 1. The request for Economic Operator Code must be made through the online portal called OPEC: www.pa.sm. The code is released directly from the program, pursuant to art. 22 of the Law March 31, 2014 n. 40, entered into force May 30, 2014. The procedure for the release of the Economic Operator Code consists of two steps: Page 8   corporate purpose and the powers of directors under the articles of Doing association. Business 2018 San Marino 5 Obtain operator code Less than one day no charge Agency : U cio Industria, Artigianato e Commercio (online procedure) The owner of the company needs to apply for a business license – phase 1. The request for Economic Operator Code must be made through the online portal called OPEC: www.pa.sm. The code is released directly from the program, pursuant to art. 22 of the Law March 31, 2014 n. 40, entered into force May 30, 2014. The procedure for the release of the Economic Operator Code consists of two steps: A) Code Request: specifying the reason for the request (the program provides a default selection of eligible reasons), free text in which to place more speci c reasons; for individuals, it is necessary to specify the object for which the license will be required. The program checks compliance with: the subject of the practice (it cannot be an un t person); that the company has not been put into liquidation; the applicant is the current administrator and that the company is not already in possession of an economic operator code B) con rms practice: the rescue of the le makes it permanent. 6 Obtain business license 1 day no charge Agency : U cio Industria, Artigianato e Commercio The owner of the company needs to apply for a business license – phase 2. As of March 31, 2014 n. 40 (on May 30, 2014), the entrepreneur can now apply for the business license online through www.pa.sm. It will be necessary to scan and enclose the following documents in order to request the business license: 1. a business plan indicating the activities and structure of the company, 2. a copy of the lease agreement of the registered o ce duly registered, 3. a certi cate of habitability, 4. cadastral map of the o ce. The object of the license must be: lawful, possible, determined, consistent, referring to the actual activity that is going to be in place. Page 9   Doing Business 2018 San Marino 6 Obtain business license 1 day no charge Agency : U cio Industria, Artigianato e Commercio The owner of the company needs to apply for a business license – phase 2. As of March 31, 2014 n. 40 (on May 30, 2014), the entrepreneur can now apply for the business license online through www.pa.sm. It will be necessary to scan and enclose the following documents in order to request the business license: 1. a business plan indicating the activities and structure of the company, 2. a copy of the lease agreement of the registered o ce duly registered, 3. a certi cate of habitability, 4. cadastral map of the o ce. The object of the license must be: lawful, possible, determined, consistent, referring to the actual activity that is going to be in place. 7 Pay business license tax 1 day EUR 1,700 Agency : U cio del Registro e delle Ipoteche – Segreteria di Stato per le Finanze e il Bilancio The costumer has to pay the business license tax at the U cio del Registro e delle Ipoteche – Segreteria di Stato per le Finanze e il Bilancio. Payment can be done in person at the o ce or online through www.pa.sm. 8 Open a bank account 1 day no charge Agency : Commercial bank According to para 3 of Article 10 of the Company Law, it is required that at least 50% of the capital are paid-in within 60 days from the company formation. In case the payment is done in cash, it should be deposited to the company's account within a bank of San Marino (i.e., local bank). The remaining amount should be paid-in within 3 years. The payment of the capital is attested within a statement issued by the legal representative of the company and authenticated in the signature by a San Marino Notary. Such authenticated statement of the payment must be led within thirty days from the same payment at the Register of Companies. Applies to women only. Takes place simultaneously with previous procedure. Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of Page 10   building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional Applies to women only. Takes place simultaneously with previous procedure. Doing Business 2018 San Marino Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the receiving all necessary inspections economy’s largest business city. For 11 economies the data are also collected for the second largest business city. Obtaining utility connections for water and - Is 100% domestically and privately owned; has ve owners, none of whom sewerage is a legal entity. Has a licensed architect and a licensed engineer, both Registering and selling the warehouse after its registered with the local association of architects or engineers. BuildCo is completion not assumed to have any other employees who are technical or licensed Time required to complete each procedure experts, such as geological or topographical experts. (calendar days) - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. Does not include time spent gathering information The warehouse: Each procedure starts on a separate day— - Will be used for general storage activities, such as storage of books or though procedures that can be fully completed stationery. online are an exception to this rule - Will have two stories, both above ground, with a total constructed area of Procedure is considered completed once final approximately 1,300.6 square meters (14,000 square feet). Each oor will document is received be 3 meters (9 feet, 10 inches) high and will be located on a land plot of No prior contact with officials approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita. Cost required to complete each procedure (% of - Will have complete architectural and technical plans prepared by a warehouse value) licensed architect. If preparation of the plans requires such steps as Official costs only, no bribes obtaining further documentation or getting prior approvals from external Building quality control index (0-15) agencies, these are counted as procedures. - Will take 30 weeks to construct (excluding all delays due to administrative Sum of the scores of six component indices: and regulatory requirements). Quality of building regulations (0-2) The water and sewerage connections: Quality control before construction (0-1) - Will be 150 meters (492 feet) from the existing water source and sewer Quality control during construction (0-3) tap. If there is no water delivery infrastructure in the economy, a borehole Quality control after construction (0-3) will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built. Liability and insurance regimes (0-2) - Will have an average water use of 662 liters (175 gallons) a day and an Professional certifications (0-4) average wastewater ow of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and a peak wastewater ow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater ow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Standardized Warehouse Page 11   and 4 inches in diameter for the sewerage connection. Doing Business 2018 San Marino Standardized Warehouse Estimated value of warehouse EUR 2,099,468.60 City Covered San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Procedures (number) 15 16.0 12.5 7.00 (Denmark) Time (days) 145.5 168.3 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 5.5 4.0 1.6 0.10 (5 Economies) Building quality control index (0-15) 13.0 11.4 11.4 15.00 (3 Economies) Figure – Dealing with Construction Permits in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 73.86: Malta (Rank: 45) 72.48: Greece (Rank: 58) 71.20: San Marino (Rank: 68) 68.09: Regional Average (Europe & Central Asia) 67.26: Italy (Rank: 96) 63.99: Cyprus (Rank: 120) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontier scores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Dealing with Construction Permits in San Marino – Procedure, Time and Cost Time Cost 6 140 120 5 Cost (% of warehouse value) 100 4 Time (days) 80 3 60 2 40 1 20 0 0 1 2 3 4 *5 *6 7 8 9 * 10 * 11 12 * 13 14 15 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 12   component indicators. Doing Business 2018 San Marino Figure – Dealing with Construction Permits in San Marino – Procedure, Time and Cost Time Cost 6 140 120 5 Cost (% of warehouse value) 100 4 Time (days) 80 3 60 2 40 1 20 0 0 1 2 3 4 *5 *6 7 8 9 * 10 * 11 12 * 13 14 15 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Dealing with Construction Permits in San Marino and comparator economies – Measure of Quality 13.5 13.0 13.0 13 12.5 Index score 12.0 12 11.4 11.5 11.0 11.0 11 10.5 10 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Dealing with Construction Permits in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain map and proof of ownership 1 day EUR 23 Agency : U cio Tecnico del Catasto - Dipartimento Territorio e Ambiente First, BuildCo must obtain cadastral maps(accatastamento or allibramento) and proof of ownership (partita catastale) from the U cio Tecnico del Catasto - Dipartimento Territorio e Ambiente. 2 Obtain electrical system clearance 1 day EUR 50 Agency : U cio Urbanistica Meanwhile, BuildCo can obtain an Attestato di conformità del progetto alle norme energetiche vigenti" from the U cio Urbanisticam which is under the Segreteria di Stato per il Territorio, l’Ambiente e l’Agricoltura. This is a Page 13   San Marino Cyprus Greece Italy Malta Europe & Central Asia Doing Business 2018 San Marino Details – Dealing with Construction Permits in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain map and proof of ownership 1 day EUR 23 Agency : U cio Tecnico del Catasto - Dipartimento Territorio e Ambiente First, BuildCo must obtain cadastral maps(accatastamento or allibramento) and proof of ownership (partita catastale) from the U cio Tecnico del Catasto - Dipartimento Territorio e Ambiente. 2 Obtain electrical system clearance 1 day EUR 50 Agency : U cio Urbanistica Meanwhile, BuildCo can obtain an Attestato di conformità del progetto alle norme energetiche vigenti" from the U cio Urbanisticam which is under the Segreteria di Stato per il Territorio, l’Ambiente e l’Agricoltura. This is a clearance form that certi es that the electrical system is consistent with the existing construction regulations on electric. 3 Hire an independent engineer for inspecting structural feasibility 1 day EUR 50 Agency : Private Engineer BuildCo needs to hire an independent engineer to attest that the structural project is consistent and can be implemented (Controllo Strutture). The engineer also checks if the structural project complies with anti-seismic standards. The hiring comes after the conformity from the two previous procedures, so it cannot be a simultaneous one. 4 Obtain the construction permit 90 days EUR 105,148 Agency : U cio Urbanistica BuildCo must le a request for the construction permit at the U cio Urbanistica under the Segreteria di Stato per il Territorio, l’Ambiente e l’Agricoltura. The following documentation needs to be attached to the request: - Project documents - Map (allibramento) - Proof of ownership (partite) - Relazione sulla fattibilita’ strutturale - Attestato di conformità del progetto alle norme energetiche vigenti When the request is processed, the U cio Urbanistica will notify BuildCo about the total cost for obtaining the permit. Once noti ed by the U cio Urbanistica of the amount due, BuildCo has to pay the Tassa di Concessione Edilizia. This is done at a bank. As per the Piano Regolatore Generale of 1992 the amount due equals 8% of the construction cost. This construction cost estimates are updated by Decrees of the Commission for Territorial Policies (Commissione per le Politiche Territoriali). The estimates depend on the intended use of the construction (destinazione d’uso). The category that applies to the Doing Business case-study is category D5 (Wholesale activities - Commercio all’ingrosso). As per the latest Decree the estimated construction cost is EUR 1,010.5683086 per square meter. U1 and U2 (oneri di urbanizzazione primaria e secondaria) are not due as it is assumed that this is an area of Intervento Diretto. Page 14   standards. The hiring comes after the conformity from the two previous Doing procedures, so it cannot Business 2018 San be a simultaneous one. Marino 4 Obtain the construction permit 90 days EUR 105,148 Agency : U cio Urbanistica BuildCo must le a request for the construction permit at the U cio Urbanistica under the Segreteria di Stato per il Territorio, l’Ambiente e l’Agricoltura. The following documentation needs to be attached to the request: - Project documents - Map (allibramento) - Proof of ownership (partite) - Relazione sulla fattibilita’ strutturale - Attestato di conformità del progetto alle norme energetiche vigenti When the request is processed, the U cio Urbanistica will notify BuildCo about the total cost for obtaining the permit. Once noti ed by the U cio Urbanistica of the amount due, BuildCo has to pay the Tassa di Concessione Edilizia. This is done at a bank. As per the Piano Regolatore Generale of 1992 the amount due equals 8% of the construction cost. This construction cost estimates are updated by Decrees of the Commission for Territorial Policies (Commissione per le Politiche Territoriali). The estimates depend on the intended use of the construction (destinazione d’uso). The category that applies to the Doing Business case-study is category D5 (Wholesale activities - Commercio all’ingrosso). As per the latest Decree the estimated construction cost is EUR 1,010.5683086 per square meter. U1 and U2 (oneri di urbanizzazione primaria e secondaria) are not due as it is assumed that this is an area of Intervento Diretto. Once the hiring of an independent engineer happens, one can obtain a construction permit. It is not simultaneous. 5 Request and receive a structural authorization from the Servizio 40 days EUR 500 Controllo Strutture Agency : Servizio Controllo Strutture Buildco must submit a request for Structural Authorization at the Servizio Controllo Strutture. The following documents is need to be attached to the request: -Authorized architectural project -geological report -Structural design report -Executives structural drawings -receipt of payment of the fee (by bank transfer) 6 Obtain re safety clearance 14 days no charge Agency : Protezione Civile BuildCo must obtain a re safety clearance. In order to do so, BuildCo submits the project documentation to the Protezione Civile and obtains a Parere di conformità norme prevenzione incendi. This means that this procedure can be simultaneous with the previous one. 7 Receive on-site inspection and obtain structural conformity certi cate 3 days EUR 3,000 Agency : Private Engineer An independent engineer needs to be hired by BuildCo to carry out an inspection to test whether the structures built are in conformity with the Page 15   structural project. The engineer sends the conformity certi cate about 2 Parere di conformità norme prevenzione incendi. This means that this Doing procedure Business can be simultaneous 2018 San Marinowith the previous one. 7 Receive on-site inspection and obtain structural conformity certi cate 3 days EUR 3,000 Agency : Private Engineer An independent engineer needs to be hired by BuildCo to carry out an inspection to test whether the structures built are in conformity with the structural project. The engineer sends the conformity certi cate about 2 days after the inspection took place. This can only happen if the safety clearance is granted and the construction has started, therefore it is not a simultaneous procedure. 8 Receive on-site inspection and obtain energy performance certi cate 3 days EUR 2,000 Agency : Private Engineer An engineer must be hired in order to carry out an inspection to test the thermic dispersion of the structure. The engineer sends the certi cate about 2 days after the inspection takes place. 9 Obtain certi cate of conformity 20 days EUR 50 Agency : U cio Urbanistica When construction is completed, BuildCo must request a certi cate of conformity and accessibility (Certi cato di Conformita’ Edilizia ed Agibilita’, also called Abitabilita’) from the U cio Urbanistica. Request and receive on-site inspection from Protezione Civile 3 days no charge 10 Agency : Protezione Civile BuildCo must request an on-site inspection from the Protezione Civile to check that the building is consistent with the re hazard provisions contained in the building project. A clearance certi cate is available for pick up 2 days after the inspection. This means that this procedure can be simultaneous with the previous one. Request and receive on-site inspection from U cio Urbanistica 3 days no charge 11 Agency : U cio Urbanistica BuildCo must request an on-site inspection from the U cio Urbanistica to check that the building is consistent with the anti-seismic provisions contained in the building project. A clearance certi cate is available for pick up 2 days after the inspection. Since this procedure is done after the construction is nalized, it can be a simultaneous procedure with the inspection described in the previous procedure. 12 Register the building 1 day EUR 3,000 Agency : Cadastre O ce The independent engineer completes the documentation for the registration at the cadastre, and then must physically visit the o ce and provide the details of the new building. The cadastre then takes about 3 months to update the information in the system but the formal registration happens right away. The application costs EUR 10, and the rest of the fee is for the independent engineer. This happens only after the on-site inspection was done, so simultaneity is not applicable. Apply for water and sewage connection at AASS 0.5 days EUR 5 13 Agency : Stato per i Servizi Pubblici (A.A.S.S.) BuildCo must le an online application form on the website of Azienda Autonoma di Stato per i Servizi Pubblici (A.A.S.S.) in order to obtain an on-site Page 16   inspection. The web address is: http://88.48.238.238/websm/Contratto.aspx engineer. This happens only after the on-site inspection was done, so Doing simultaneity is not applicable. Business 2018 San Marino Apply for water and sewage connection at AASS 0.5 days EUR 5 13 Agency : Stato per i Servizi Pubblici (A.A.S.S.) BuildCo must le an online application form on the website of Azienda Autonoma di Stato per i Servizi Pubblici (A.A.S.S.) in order to obtain an on-site inspection. The web address is: http://88.48.238.238/websm/Contratto.aspx 14 Receive inspection for water and sewage from AASS 5 days no charge Agency : Stato per i Servizi Pubblici (A.A.S.S.) This inspection is conducted only after the application is done, so it is not a simultaneous procedure. 15 Obtain water and sewage connection 20 days EUR 1,276 Agency : Stato per i Servizi Pubblici (A.A.S.S.) Obtaining the water and sewage connection depend on the inspection, therefore it cannot be a simultaneous procedure. Takes place simultaneously with previous procedure. Details – Dealing with Construction Permits in San Marino – Measure of Quality Answer Score Building quality control index (0-15) 13.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) external engineer or rm. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 Page 17   accordance with the approved plans and regulations? (0-2) inspection is Takes place simultaneously with previous procedure. Doing Business 2018 San Marino Details – Dealing with Construction Permits in San Marino – Measure of Quality Answer Score Building quality control index (0-15) 13.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) external engineer or rm. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency; Yes, external engineer submits report for nal inspection. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Professional in charge of the supervision; Page 18   Construction Liability Doing 2018 regimes and insurance Business index (0-2) San Marino 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Professional in charge of the supervision; Construction company. Which parties (if any) are required by law to obtain an insurance policy to cover No party is 0.0 possible structural aws or problems in the building once it is in use (Latent Defect required by law Liability Insurance or Decennial Insurance)? (0-1) to obtain insurance . Professional certi cations index (0-4) 4.0 What are the quali cation requirements for the professional responsible for verifying Minimum 2.0 that the architectural plans or drawings are in compliance with existing building number of years regulations? (0-2) of experience; University degree in architecture or engineering; Being a registered architect or engineer. What are the quali cation requirements for the professional who supervises the Minimum 2.0 construction on the ground? (0-2) number of years of experience; University degree in engineering, construction or construction management; Passing a certi cation exam. Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Page 19   Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is certi cation exam. Doing Business 2018 San Marino Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or income per capita) underground, whichever is more common in the area where the warehouse is located and requires works that involve the crossing of a 10- Official costs only, no bribes meter road (such as by excavation or overhead lines) but are all carried out Value added tax excluded on public land. There is no crossing of other owners’ private property The reliability of supply and transparency of because the warehouse has access to a road. tari s index (0-8) - Does not require work to install the internal wiring of the warehouse. This has already been completed up to and including the customer’s service Duration and frequency of power outages (0–3) panel or switchboard and the meter base. Tools to monitor power outages (0–1) Tools to restore power supply (0–1) The monthly consumption: Regulatory monitoring of utilities’ performance - It is assumed that the warehouse operates 30 days a month from 9:00 (0–1) a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity Financial deterrents limiting outages (0–1) on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours Transparency and accessibility of tariffs (0–1) (kWh); hourly consumption is 112 kWh. Price of electricity (cents per kilowatt-hour)* - If multiple electricity suppliers exist, the warehouse is served by the Price based on monthly bill for commercial cheapest supplier. warehouse in case study - Tari s e ective in March of the current year are used for calculation of the price of electricity for the warehouse. Although March has 31 days, for * N o t e : Doing Business m e a s u r e s t h e p r i c e o f calculation purposes only 30 days are used. electricity, but it is not included in the distance to frontier score nor the ranking on the ease of getting electricity. Page 20   Standardized Connection frontier score nor the ranking on the ease of getting electricity. Doing Business 2018 San Marino Standardized Connection Price of electricity (US cents per kWh) 13.7 Name of utility AASS (Azienda Autonoma di Stato per i Servizi Publici) City Covered San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Procedures (number) 3 5.4 4.7 2 (United Arab Emirates) Time (days) 45 113.7 79.1 10 (United Arab Emirates) Cost (% of income per capita) 60.8 344.3 63.0 0.00 (Japan) Reliability of supply and transparency of tariff 6 5.3 7.4 8.00 (28 Economies) index (0-8) Figure – Getting Electricity in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 90.63: San Marino (Rank: 14) 85.27: Italy (Rank: 28) 78.32: Cyprus (Rank: 67) 75.97: Greece (Rank: 76) 75.16: Malta (Rank: 78) 70.35: Regional Average (Europe & Central Asia) Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores for getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Getting Electricity in San Marino – Procedure, Time and Cost Time Cost 45 70 40 60 Cost (% of income per capita) 35 50 30 Time (days) 25 40 20 30 15 20 10 5 Page 21   10 getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 San Marino Figure – Getting Electricity in San Marino – Procedure, Time and Cost Time Cost 45 70 40 60 Cost (% of income per capita) 35 50 30 Time (days) 25 40 20 30 15 20 10 10 5 0 0 1 *2 3 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Getting Electricity in San Marino and comparator economies – Measure of Quality 9 8 8 7 7 7 6 6 6 Index score 5.3 5 4 3 2 1 0 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Getting Electricity in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application to AASS and await estimate 10 calendar days EUR 0 Agency : AASS (Azienda Autonoma di Stato per i Servizi Publici) The request for new electricity connection can be done either on-line or physically at the premises of AASS. It must specify the technical details of the connection and some other things. The company must also attach a certi cate of good standing (certi cate di vigenza giuridica). 2 Receive site inspection by AASS engineer 1 calendar day EUR 0 Agency : AASS (Azienda Autonoma di Stato per i Servizi Publici) An engineer of AASS visits the client’s premises and conducts a short inspection to check where the closest connection point is, what connection it Page 22   San Marino Cyprus Greece Italy Malta Europe & Central Asia Doing Business 2018 San Marino Details – Getting Electricity in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application to AASS and await estimate 10 calendar days EUR 0 Agency : AASS (Azienda Autonoma di Stato per i Servizi Publici) The request for new electricity connection can be done either on-line or physically at the premises of AASS. It must specify the technical details of the connection and some other things. The company must also attach a certi cate of good standing (certi cate di vigenza giuridica). 2 Receive site inspection by AASS engineer 1 calendar day EUR 0 Agency : AASS (Azienda Autonoma di Stato per i Servizi Publici) An engineer of AASS visits the client’s premises and conducts a short inspection to check where the closest connection point is, what connection it would be and if there is the need to occupy the public space. After the inspection, the utility (AASS) sends the client an estimate of the connection costs (preventivo) through fax and a letter. 3 Sign contract and await external works and meter installation by AASS 35 calendar days EUR 25,525.26 Agency : AASS (Azienda Autonoma di Stato per i Servizi Publici) After the reception of the preventivo, and in case the client already agrees with the amounts provided, AASS prepares the contract, which is signed at AASS’s premises as soon as the client can come to sign it and make the payment. There are 3 amounts that need to be paid. The client can pay cash, wire transfer or check at the moment the contract is signed. • Fixed amount: Contributto di allacciamento forfettario • Variable amount: Contributto di allacciamento a preventivo, which depends on the amount of works that need to be made. This amount comprises both the material costs as well as the labor costs of the works as well as general expenses. Of this amount, only 70% is born by the client. The 30% remaining is born by AASS (state discount). Pleae also see the document in the O drive with a draft of the preventivo. • Security deposit: Anticipo fornitura • Taxes on this aggregated amounts: Marca di Bollo (10 Euro, always xed amount taxed on public documents), and a tax called Imposto di Quietanza, which amounts to 1,5 per 1000 of the total amount resulting from aggregating 1 and 2 and 3 above. AASS will take care of the permit to occupy the street and to do the underground works. This permit is the licenzia d’occupazione pubblica. As part of this phase, the meter is also installed, always outside the warehouse of the client. Takes place simultaneously with previous procedure. Details – Getting Electricity in San Marino – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 6 Page 23   Takes place simultaneously with previous procedure. Doing Business 2018 San Marino Details – Getting Electricity in San Marino – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 6 Total duration and frequency of outages per customer a year (0-3) 2 System average interruption duration index (SAIDI) 0.3 System average interruption frequency index (SAIFI) 1.5 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 1.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 0 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages No exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.aass.sm/ site/home/info/tari e-acqua-gas-en.- elettrica-e-tassa- ambientale.html Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 24   If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Doing Business 2018 San Marino Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally transfer title on immovable To make the data comparable across economies, several assumptions property (number) about the parties to the transaction, the property and the procedures are used. Preregistration procedures (for example, checking for liens, notarizing sales agreement, The parties (buyer and seller): paying property transfer taxes) - Are limited liability companies (or the legal equivalent). Registration procedures in the economy's largest - Are located in the periurban area of the economy’s largest business city. business citya. For 11 economies the data are also collected for the second largest Postregistration procedures (for example, filling business city. title with municipality) - Are 100% domestically and privately owned. Time required to complete each procedure - Have 50 employees each, all of whom are nationals. (calendar days) - Perform general commercial activities. Does not include time spent gathering information The property (fully owned by the seller): - Has a value of 50 times income per capita, which equals the sale price. Each procedure starts on a separate day - though - Is fully owned by the seller. procedures that can be fully completed online - Has no mortgages attached and has been under the same ownership for are an exception to this rule the past 10 years. Procedure is considered completed once final - Is registered in the land registry or cadastre, or both, and is free of title document is received disputes. No prior contact with officials - Is located in a periurban commercial zone, and no rezoning is required. Cost required to complete each procedure (% of - Consists of land and a building. The land area is 557.4 square meters property value) (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in Official costs only (such as administrative fees, good condition, has no heating system and complies with all safety duties and taxes). standards, building codes and legal requirements. The property, Value Added Tax, Capital Gains Tax and illicit consisting of land and building, will be transferred in its entirety. payments are excluded - Will not be subject to renovations or additional construction following the Quality of land administration index (0-30) purchase. - Has no trees, natural water sources, natural reserves or historical Reliability of infrastructure index (0-8) monuments of any kind. Transparency of information index (0–6) - Will not be used for special purposes, and no special permits, such as for Geographic coverage index (0–8) residential use, industrial plants, waste storage or certain types of agricultural activities, are required. Land dispute resolution index (0–8) - Has no occupants, and no other party holds a legal interest in it. Equal access to property rights index (-2–0) Standard Property Transfer Property value EUR 2,099,468.60 City Covered San Marino Page 25   Europe & OECD high Doing Business 2018 San Marino Standard Property Transfer Property value EUR 2,099,468.60 City Covered San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Procedures (number) 9 5.3 4.6 1.00 (4 Economies) Time (days) 42.5 20.4 22.3 1.00 (3 Economies) Cost (% of property value) 4.1 2.5 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 23.0 19.8 22.7 29.00 (Singapore) Figure – Registering Property in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 81.70: Italy (Rank: 23) 76.02: Regional Average (Europe & Central Asia) 65.68: San Marino (Rank: 78) 63.41: Cyprus (Rank: 92) 49.67: Greece (Rank: 145) 48.86: Malta (Rank: 147) Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Registering Property in San Marino – Procedure, Time and Cost Time Cost 4.5 40 4 35 3.5 Cost (% of property value) 30 3 Time (days) 25 2.5 20 2 15 1.5 10 1 5 0.5 0 0 1 2 3 4 5 6 7 8 9 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 26   Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 San Marino Figure – Registering Property in San Marino – Procedure, Time and Cost Time Cost 4.5 40 4 35 3.5 Cost (% of property value) 30 3 Time (days) 25 2.5 20 2 15 1.5 10 1 5 0.5 0 0 1 2 3 4 5 6 7 8 9 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Registering Property in San Marino and comparator economies – Measure of Quality 30 26.5 25 23.0 23.0 19.8 20 Index score 15 12.5 10 4.5 5 0 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Registering Property in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Check for encumbrances on the property Less than a day EUR 5 for each Agency : U cio del Registro e delle Ipoteche – Segreteria di Stato per le (online procedure) cadastral title search Finanze e il Bilancio + EUR 5 check for buyer's leases The notary accesses the Web Site: www.pa.sm, through a special registered password. The cost of Euro 5.00 is charged automatically via pre-paid to the notary account. The notary enters the company name and COE number, in order to search real estate encumbrances and real estate leasing. it is possible to print the online title search of the company 2 Obtain cadastral maps 1 day EUR 22 (includes Agency : U cio Tecnico del Catasto- Dipartimento Territorio e Ambiente Partita catastale EUR Page 27   (Cadaster o ce) 10 + Allibramento San Marino Cyprus Greece Italy Malta Europe & Central Asia Doing Business 2018 San Marino Details – Registering Property in San Marino – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Check for encumbrances on the property Less than a day EUR 5 for each Agency : U cio del Registro e delle Ipoteche – Segreteria di Stato per le (online procedure) cadastral title search Finanze e il Bilancio + EUR 5 check for buyer's leases The notary accesses the Web Site: www.pa.sm, through a special registered password. The cost of Euro 5.00 is charged automatically via pre-paid to the notary account. The notary enters the company name and COE number, in order to search real estate encumbrances and real estate leasing. it is possible to print the online title search of the company 2 Obtain cadastral maps 1 day EUR 22 (includes Agency : U cio Tecnico del Catasto- Dipartimento Territorio e Ambiente Partita catastale EUR (Cadaster o ce) 10 + Allibramento catastale EUR 7 + A notary or the customer obtains the following documentation on the Mappa catastale property from the Cadaster o ce: (i) Partita catastale (EUR 10): a summary (EUR 5) of the ownership and characteristics of the property; (ii) Allibramento catastale (EUR 7): a plant of the building on the property; and (iii) Mappa catastale (EUR 5): a map of the property 3 Obtain certi cates of use and habitability (abitabilita’) 1 day EUR 50 (includes Agency : U cio Urbanistica – Dipartimento Territorio e Ambiente Certificazione di destinazione A notary or the customer obtains the following two certi cates from the urbanistica EUR 20 + U cio Urbanistica – Dipartimento Territorio e Ambiente: Certificato di Abitabilita EUR 30) (i) Certi cazione di destinazione urbanistica (EUR 20): certi es the type of activity to be conducted in the property (retail, commercial, wholesale, industrial, etc.); (ii) Certi cato di Abitabilita (EUR 30): certi es that the building respects mandatory construction standards. 4 Obtain occupational certi cate 1 day EUR 50 Agency : U cio del Lavoro A notary or the customer obtains an occupational certi cate (Certi cato Occupazionale) attesting the number of employees that work for the buying company. This certi cate must be attached necessarily to the instance to the Council of the Twelve (Consiglio dei Dodici) 5 Obtain certi cate of Vigenza 1 day EUR 50 Agency : Casellario Giudiziario – Tribunale (Judicial registry – Tribunal) The notary, or his nominee, submits a written request by fax to the Commercial Chancellery, after one day the certi cate is issued and it can be picked up at the o ce. This certi cation con rms the status of the company, highlighting the name, the date and number of registration, the corporate bodies, the corporate purpose and the powers of directors under the articles of association. 6 Obtain property transfer authorization from the Consiglio dei Dodici 7 days (before EUR 10 Agency : Segreteria Esecutiva del Congresso di Stato council meeting) + 7 Page 28   days (council bodies, the corporate purpose and the powers of directors under the Doing articles Businessof association. 2018 San Marino 6 Obtain property transfer authorization from the Consiglio dei Dodici 7 days (before EUR 10 Agency : Segreteria Esecutiva del Congresso di Stato council meeting) + 7 days (council The request for authorization to the Council of the Twelve is presented by verification) + 10 the Notary at the Executive Secretariat of the State Congress. The Council's days (Ministry of approval is required for the purchase of real estate by the company Foreign Affairs) pursuant to article 21, paragraph 7 of the Law 47/2006 et seq. The application must be accompanied by the following documents: (i) Certi cate of Good Standing (obtained in Procedure 5); (ii) Occupational Certi cate (obtained in Procedure 4); (iii) Cadastral Certi cate of real estate of the applicant company (obtained in Procedure 2); (iv) Land Registry Record (Obtained in Procedure 1); (v) Cadastral Map (obtained in procedure 2); (vi) Allibramento (obtained in procedure 2); (viii) Urban destination Certi cate (obtained in procedure 3); (ix) Certi cate in accordance with Law 147 of 28 October 2005 (stating the fact that the property does not fall within the list of properties on which the "Ecc.ma Camera of San Marino" has the right to exercise pre-emption on the purchase), referring to the Property. The application shall contain a declaration of the notary certifying the existence of real estate leasing ongoing, publicly registered against the applicant company. After the Communication of the Secretariat of Institutional on January 26, 2016, the text of the instance must also state any previous authorizations of the Council of the Twelve to which is not actually followed the transfer of the property. 7 Obtain Certi cate as per Article 177 10 days EUR 30 + EUR 20 Agency : U cio Urbanistica – Dipartimento Territorio e Ambiente (stamp duty) = EUR 50 A notary or the customer requests a certi cate of conformity as per Article 177 (Certi cato ai sensi dell’articolo 177). This certi es that there is no pending procedure on violations of construction laws and standards related to the warehouse being sold. In 10 days the certi cate is sent to the notary. 8 Parties sign the transfer contract 1 day EUR 4.160 (Notary Agency : Notary Fees EUR 3.520 + 500 Miscellaneous The buyer and the seller meet at the notary’s o ce and sign the property services of the transfer contract. The fees are subject the limits set in the Legal tari as Notary + EUR 20 per Approved by the Executive Council of the Order of Lawyers and Notaries of Rights of archive + San Marino, dated 01.06.2012 (in force since 01.06.2012). EUR 20 right of The notary then prepares 3 certi ed copies of the deed, repository + EUR 40 including all attachments required (one copy for registration purposes; one euro for copy for transcription; one for Land Registry use). Each copy costs EUR 10 in rights of revenue stamps for every 4 pages). "scritturazione" + EUR 60 for Stamps for three copies of the deed) 9 Register property transfer deed 3 days 3.90% of transfer Agency : U cio del Registro e delle Ipoteche – Segreteria di Stato per le value (2.5% for Finanze e il Bilancio register tax, 1% for transcription and A notary registers the property transfer deed at the U cio del Registro e 0.4% for Cadastre) + delle Ipoteche – Segreteria di Stato per le Finanze e il Bilancio. Besides the EUR 130 (stamp transfer deed (and its certi ed copies), the Notary has to provide the duties) Page 29   following documents: for three copies of Doing Business 2018 San Marino the deed) 9 Register property transfer deed 3 days 3.90% of transfer Agency : U cio del Registro e delle Ipoteche – Segreteria di Stato per le value (2.5% for Finanze e il Bilancio register tax, 1% for transcription and A notary registers the property transfer deed at the U cio del Registro e 0.4% for Cadastre) + delle Ipoteche – Segreteria di Stato per le Finanze e il Bilancio. Besides the EUR 130 (stamp transfer deed (and its certi ed copies), the Notary has to provide the duties) following documents: (i) Authorization of the Council of the Twelve (obtained in Procedure 6); (ii) Land Registry Record (obtained in Procedure 1); (iii) Cadastral Map (obtained in Procedure 2); (iv) Allibramento (obtained in Procedure 2); (v) Certi cate pursuant to Art. 177 - Certi cation in accordance with Law 28 October 2005 no. 147, this certi cate costs about EUR 75 for each property underling (vi) Energetic certi cation. The Notary goes to the U cio del Registro in order to register the deed and pay the transfer tax. The payment takes place at the U cio del Registro. After 3 days the deed is registered and the U cio del Registro submits the information to the Cadastre o ce that updates it. The tax of 3.90% for transfers of immovable property has been introduced by Art. 18 of Law n. 146 of 19 September 2014 as an incentive to real estate transfers, instead of the ordinary tax of 6.40%. This favorable tax treatment has been extended by art. 37 of Law 144/2016 until 31 December 2017. Takes place simultaneously with previous procedure. Details – Registering Property in San Marino – Measure of Quality Answer Score Quality of the land administration index (0-30) 23.0 Reliability of infrastructure index (0-8) 5.0 What is the institution in charge of immovable property registration? U cio del Registro e Conservatoria delle ipoteche della repubblica di San Marino In what format are the majority of title or deed records kept in the largest business city Computer/Scann 1.0 —in a paper format or in a computerized format (scanned or fully digital)? ed Is there an electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: U cio Catasto e Urbanistica della repubblica di San Marino In what format are the majority of maps of land plots kept in the largest business city— Computer/Scann 1.0 in a paper format or in a computerized format (scanned or fully digital)? ed Page 30   Takes place simultaneously with previous procedure. Doing Business 2018 San Marino Details – Registering Property in San Marino – Measure of Quality Answer Score Quality of the land administration index (0-30) 23.0 Reliability of infrastructure index (0-8) 5.0 What is the institution in charge of immovable property registration? U cio del Registro e Conservatoria delle ipoteche della repubblica di San Marino In what format are the majority of title or deed records kept in the largest business city Computer/Scann 1.0 —in a paper format or in a computerized format (scanned or fully digital)? ed Is there an electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: U cio Catasto e Urbanistica della repubblica di San Marino In what format are the majority of maps of land plots kept in the largest business city— Computer/Scann 1.0 in a paper format or in a computerized format (scanned or fully digital)? ed Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Di erent 1.0 cadastral or mapping agency kept in a single database, in di erent but linked databases databases but or in separate databases? linked Do the immovable property registration agency and cadastral or mapping agency use No 0.0 the same identi cation number for properties? Transparency of information index (0–6) 4.0 Who is able to obtain information on land ownership at the agency in charge of Anyone who 1.0 immovable property registration in the largest business city? pays the o cial fee Is the list of documents that are required to complete any type of property transaction Yes, on public 0.5 made publicly available–and if so, how? boards Link for online access: Is the applicable fee schedule for any property transaction at the agency in charge of Yes, on public 0.5 immovable property registration in the largest business city made publicly available– boards and if so, how? Link for online access: Does the agency in charge of immovable property registration commit to delivering a Yes, on public 0.5 legally binding document that proves property ownership within a speci c time frame– boards and if so, how does it communicate the service standard? Page 31   Link for Doing online access: Business 2018 San Marino Does the agency in charge of immovable property registration commit to delivering a Yes, on public 0.5 legally binding document that proves property ownership within a speci c time frame– boards and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the agency in charge of immovable property registration? Contact information: Are there publicly available o cial statistics tracking the number of transactions at the No 0.0 immovable property registration agency? Number of property transfers in the largest business city in 2015: Who is able to consult maps of land plots in the largest business city? Freely accessible 0.5 by anyone Is the applicable fee schedule for accessing maps of land plots made publicly available Yes, online 0.5 —and if so, how? Link for online access: http://www.territ oriorsm.sm/work /info/verif- cat/doc/impostei mm/DD090- 2013.pdf Does the cadastral or mapping agency commit to delivering an updated map within a Yes, on public 0.5 speci c time frame—and if so, how does it communicate the service standard? boards Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the cadastral or mapping agency? Contact information: Geographic coverage index (0–8) 8.0 Are all privately held land plots in the economy formally registered at the immovable Yes 2.0 property registry? Are all privately held land plots in the largest business city formally registered at the Yes 2.0 immovable property registry? Are all privately held land plots in the economy mapped? Yes 2.0 Are all privately held land plots in the largest business city mapped? Yes 2.0 Land dispute resolution index (0–8) 6.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 property registry to make them opposable to third parties? Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Is there a speci c compensation mechanism to cover for losses incurred by parties who No 0.0 Page 32   engaged in good faith in a property transaction based on erroneous information Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Doing Business 2018 San Marino Is there a speci c compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certi ed by the immovable property registry? Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Registrar; Notary. Does the legal system require veri cation of the identity of the parties to a property Yes 0.5 transaction? If yes, who is responsible for verifying the identity of the parties? Registrar; Notary. Is there a national database to verify the accuracy of identity documents? Yes 1.0 For a standard land dispute between two local businesses over tenure rights of a Tribunale property worth 50 times gross national income (GNI) per capita and located in the Commissariale largest business city, what court would be in charge of the case in the rst instance? Civile How long does it take on average to obtain a decision from the rst-instance court for Between 1 and 2 2.0 such a case (without appeal)? years Are there any statistics on the number of land disputes in the rst instance? No 0.0 Number of land disputes in the largest business city in 2015: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0 Do married men and married women have equal ownership rights to property? Yes 0.0 Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a Page 33   credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Do married men and married women have equal ownership rights to property? Yes 0.0 Doing Business 2018 San Marino Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Strength of legal rights index (0-12) 1 6.6 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 0 6.3 6.6 8.00 (34 Economies) Page 34   Credit registry coverage (% of adults) 0.0 22.2 18.3 100.00 (3 Economies) possible). ABC keeps ownership and possession of the assets. Doing Business 2018 San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Strength of legal rights index (0-12) 1 6.6 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 0 6.3 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 0.0 22.2 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 0.0 42.8 63.7 100.00 (23 Economies) Figure – Getting Credit in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 64.58: Regional Average (Europe & Central Asia) 60.00: Cyprus (Rank: 68) 50.00: Greece (Rank: 90) 5.00: San Marino (Rank: 183) 45.00: Italy (Rank: 105) 30.00: Malta (Rank: 142) Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for getting credit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of credit information index. Figure – Legal Rights in San Marino and comparator economies 8 7 7 6.6 6 Index score 5 4 3 3 2 2 2 1 1 0 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Legal Rights in San Marino Strength of legal rights index (0-12) 1 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Page 35   San Marino Cyprus Greece Italy Malta Europe & Central Asia Doing Business 2018 San Marino Details – Legal Rights in San Marino Strength of legal rights index (0-12) 1 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring No a speci c description of collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds No or replacements of the original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and No obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is uni ed geographically No and by asset type, with an electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be No performed online by any interested third party? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency Yes procedure? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a business is liquidated? No Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised No reorganization procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and/or sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law No allow the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in San Marino and comparator economies 8 7 7 6.3 6 5 Index score 4 4 2 0 0 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Credit Information in San Marino Page 36   0 0 San Marino Doing Business 2018 Cyprus San Marino Greece Italy Malta Europe & Central Asia Details – Credit Information in San Marino Credit Credit Depth of credit information index (0-8) bureau registry Score Are data on both firms and individuals distributed? No No 0 Are both positive and negative credit data distributed? No No 0 Are data from retailers or utility companies - in addition to data from banks and financial institutions - No No 0 distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more No No 0 than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? No No 0 By law, do borrowers have the right to access their data in the credit bureau or credit registry? No No 0 Can banks and financial institutions access borrowers’ credit information online (for example, No No 0 through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help banks and financial No No 0 institutions assess the creditworthiness of borrowers? Score ("yes" to either public bureau or private registry) 0 Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 0 0 Number of firms 0 0 Total 0 0 Percentage of adult population 0.0 0.0 Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it is assumed that Buyer is a large private company with multiple Page 37   transactions; Available legal remedies (damages, Percentage of adult population 0.0 0.0 Doing Business 2018 San Marino Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it transactions; Available legal remedies (damages, is assumed that Buyer is a large private company with multiple disgorgement of profits, fines, imprisonment, shareholders. rescission of the transaction) - Has a board of directors and a chief executive o cer (CEO) who may legally act on behalf of Buyer where permitted, even if this is not speci cally Ease of shareholder suits index (0–10): Access to required by law. internal corporate documents; Evidence - Has a supervisory board (applicable to economies with a two-tier board obtainable during trial and allocation of legal system) on which 60% of the shareholder-elected members have been expenses appointed by Mr. James, who is Buyer’s controlling shareholder and a Extent of conflict of interest regulation index member of Buyer’s board of directors. (0–10): Simple average of the extent of disclosure, - Has not adopted any bylaws or articles of association that di er from extent of director liability and ease of default minimum standards and does not follow any nonmandatory codes, shareholder indices principles, recommendations or guidelines relating to corporate Extent of shareholder rights index (0-10): governance. Shareholders’ rights and role in major corporate - Is a manufacturing company with its own distribution network. decisions Extent of ownership and control index (0-10): The transaction involves the following details: Governance safeguards protecting shareholders - Mr. James owns 60% of Buyer and elected two directors to Buyer’s ve- from undue board control and entrenchment member board. Extent of corporate transparency index (0-10): - Mr. James also owns 90% of Seller, a company that operates a chain of Corporate transparency on ownership stakes, retail hardware stores. Seller recently closed a large number of its stores. compensation, audits and financial prospects - Mr. James proposes that Buyer purchase Seller’s unused eet of trucks to expand Buyer’s distribution of its food products, a proposal to which Buyer Extent of shareholder governance index (0–10): agrees. The price is equal to 10% of Buyer’s assets and is higher than the Simple average of the extent of shareholders market value. rights, extent of ownership and control and - The proposed transaction is part of the company’s ordinary course of extent of corporate transparency indices business and is not outside the authority of the company. Strength of minority investor protection index - Buyer enters into the transaction. All required approvals are obtained, (0–10): Simple average of the extent of conflict of and all required disclosures made (that is, the transaction is not interest regulation and extent of shareholder fraudulent). governance indices - The transaction causes damages to Buyer. Shareholders sue Mr. James and the other parties that approved the transaction. Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Extent of conflict of interest regulation index (0- 4.3 6.3 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 1.7 6.6 6.4 Page 38   9.00 (Kazakhstan) and the other parties that approved the transaction. Doing Business 2018 San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Extent of conflict of interest regulation index (0- 4.3 6.3 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 1.7 6.6 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 64.31: Regional Average (Europe & Central Asia) 63.33: Cyprus (Rank: 43) 63.33: Greece (Rank: 43) 61.67: Malta (Rank: 51) 58.33: Italy (Rank: 62) 30.00: San Marino (Rank: 175) Note: The ranking of economies on the strength of minority investor protections is determined by sorting their distance to frontier scores for protecting minority investors. These scores are the simple average of the distance to frontier scores for the extent of con ict of interest regulation index and the extent of shareholder governance index. Figure – Protecting Minority Investors in San Marino and comparator economies – Measure of Quality San Marino 0 2 3 1 4 8 Cyprus 7 4 8 6 6 7 Greece 8 4 7 7 7 5 Italy 8 4 7 4 6 6 Malta 9 6 3 4 7 8 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 Europe & Central Asia 7.4 4.6 7 5.5 7.2 6.8 0 5 10 15 20 25 30 35 40 45 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Details – Protecting Minority Investors in San Marino – Measure of Quality Answer Score Page 39   Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Doing Business 2018 San Marino Details – Protecting Minority Investors in San Marino – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 4.3 Extent of disclosure index (0-10) 3 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Shareholders or 1.0 board of directors including interested parties Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Full disclosure of 2.0 all material facts Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) No disclosure 0.0 obligation Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- No disclosure 0.0 2) obligation Extent of director liability index (0-10) 2 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively No 0.0 for the damage the transaction caused to Buyer? (0-1) Can shareholders hold the interested director liable for the damage the transaction Not liable 0.0 caused to Buyer? (0-2) Can shareholders hold the other directors liable for the damage the transaction caused Not liable 0.0 to Buyer (0-2) Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by No 0.0 shareholders? (0-1) Must Mr. James repay pro ts made from the transaction upon a successful claim by No 0.0 shareholders? (0-1) Is Mr. James disquali ed or ned and imprisoned upon a successful claim by No 0.0 shareholders? (0-1) Can a court void the transaction upon a successful claim by shareholders? (0-2) Voidable if unfair 2.0 or prejudicial Ease of shareholder suits index (0-10) 8 Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Page 40   Can the plainti directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 Doing Business 2018 San Marino document Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Can the plainti directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) Yes 1.0 Can shareholder plainti s recover their legal expenses from the company? (0-2) Yes if successful 1.0 Extent of shareholder governance index (0-10) 1.7 Extent of shareholder rights index (0-10) 4 Does the sale of 51% of Buyer's assets require shareholder approval? No 0.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of No 0.0 shareholders? Must Buyer obtain its shareholders’ approval every time it issues new shares? Yes 1.0 Do shareholders automatically receive preemption rights every time Buyer issues new Yes 1.0 shares? Must shareholders approve the election and dismissal of the external auditor? Yes 1.0 Are changes to the rights of a class of shares only possible if the holders of the a ected No 0.0 shares approve? Assuming that Buyer is a limited company, does the sale of 51% of its assets require No 0.0 member approval? Assuming that Buyer is a limited company, can members representing 10% call for a No 0.0 meeting of members? Assuming that Buyer is a limited company, must all members consent to add a new No 0.0 member? Assuming that Buyer is a limited company, must a member rst o er to sell their Yes 1.0 interest to the existing members before they can sell to non-members? Extent of ownership and control index (0-10) 1 Is it forbidden to appoint the same individual as CEO and chair of the board of No 0.0 directors? Must the board of directors include independent and nonexecutive board members? No 0.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of their term? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board members? Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 of Buyer? Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? No 0.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve No 0.0 Page 41   Buyer pay declared MustBusiness Doing 2018 San dividends within a maximum period set by law? Marino No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? No 0.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve No 0.0 disagreements among members? Assuming that Buyer is a limited company, must a potential acquirer make a tender No 0.0 o er to all shareholders upon acquiring 50% of Buyer? Assuming that Buyer is a limited company, must Buyer distribute pro ts within a No 0.0 maximum period set by law? Extent of corporate transparency index (0-10) 0 Must Buyer disclose direct and indirect bene cial ownership stakes representing 5%? No 0.0 Must Buyer disclose information about board members’ primary employment and No 0.0 directorships in other companies? Must Buyer disclose the compensation of individual managers? No 0.0 Must a detailed notice of general meeting be sent 21 days before the meeting? No 0.0 Can shareholders representing 5% of Buyer’s share capital put items on the general No 0.0 meeting agenda? Must Buyer's annual nancial statements be audited by an external auditor? No 0.0 Must Buyer disclose its audit reports to the public? No 0.0 Assuming that Buyer is a limited company, must members meet at least once a year? No 0.0 Assuming that Buyer is a limited company, can members representing 5% put items on No 0.0 the meeting agenda? Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, Page 42   and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Doing Business 2018 San Marino Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, with the requirements of post ling processes and time waiting. sales tax or goods and service tax) Method and frequency of filing and payment To make data comparable across economies, several assumptions are used: Time required to comply with 3 major taxes - TaxpayerCo is a medium-size business that started operations on January (hours per year) 1, 2015. It produces ceramic flowerpots and sells them at retail. All taxes Collecting information, computing tax payable and contributions recorded are paid in the second year of operation Completing tax return, filing with agencies (calendar year 2016). Taxes and mandatory contributions are measured at all levels of government. Arranging payment or withholding Preparing separate tax accounting books, if The VAT refund process: required - In June 2016, TaxpayerCo. makes a large capital purchase: the value of the Total tax and contribution rate (% of pro t before machine is 65 times income per capita of the economy. Sales are equally all taxes) spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income per Profit or corporate income tax capita divided by 12). The machinery seller is registered for VAT and excess Social contributions, labor taxes paid by input VAT incurred in June will be fully recovered after four consecutive employer months if the VAT rate is the same for inputs, sales and the machine and Property and property transfer taxes the tax reporting period is every month. Input VAT will exceed Output VAT Dividend, capital gains, financial transactions in June 2016. taxes The corporate income tax audit process: Waste collection, vehicle, road and other taxes - An error in calculation of income tax liability (for example, use of incorrect Post ling Index tax depreciation rates, or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a corporate income Time to comply with a VAT refund tax underpayment. TaxpayerCo. discovered the error and voluntarily Time to receive a VAT refund noti ed the tax authority. The value of the underpaid income tax liability is Time to comply with a corporate income tax audit 5% of the corporate income tax liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax Time to complete a corporate income tax audit return, but within the tax assessment period. Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Payments (number per year) 18 16.5 10.9 3 (Hong Kong SAR, China) Page 43   return, but within the tax assessment period. Doing Business 2018 San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Payments (number per year) 18 16.5 10.9 3 (Hong Kong SAR, China) Time (hours per year) 52 218.4 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 35.4 33.1 40.1 18.47% (32 Economies) Postfiling index (0-100) 67.80 65.20 83.45 99.38 (Estonia) Figure – Paying Taxes in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 82.32: San Marino (Rank: 40) 80.59: Cyprus (Rank: 44) 76.97: Greece (Rank: 65) 76.19: Malta (Rank: 71) 75.78: Regional Average (Europe & Central Asia) 68.29: Italy (Rank: 112) Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in San Marino and comparator economies – Measure of Quality 80 76.07 75.70 67.80 65.20 70 60 52.39 52.51 Index score 50 40 30 20 10 0 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Paying Taxes in San Marino Total tax and Tax or mandatory Payments Notes on Time Statutory contribution rate (% Notes on contribution (number) Payments (hours) tax rate Tax base of profit) TTR Page 44   Social Security 12 48 26.6% gross salaries 30.00 Doing Business 2018 San Marino Figure – Paying Taxes in San Marino and comparator economies – Measure of Quality 80 76.07 75.70 67.80 65.20 70 60 52.39 52.51 Index score 50 40 30 20 10 0 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Paying Taxes in San Marino Total tax and Tax or mandatory Payments Notes on Time Statutory contribution rate (% Notes on contribution (number) Payments (hours) tax rate Tax base of profit) TTR Social Security 12 48 26.6% gross salaries 30.00 contributions paid by employer Corporate income tax 1 online 4 17% taxable profit 5.10 Tax on interest 1 11% interest income 0.28 from bank deposit Capital gains tax 1 17% capital gains 0.00 included in other taxes Circulation tax 1 EUR 50 vehicle 0.00 Employee paid - Social 0 jointly 7% gross salaries 0.00 withheld security contributions Environmental tax 1 EUR 18 fixed fee 0.00 Fuel tax 1 22% included into fuel 0.00 small price amount Totals 18 52 35.4 Details – Paying Taxes in San Marino – Tax by Type Taxes by type Answer Profit tax (% of profit) 5.1 Labor tax and contributions (% of profit) 30.0 Other taxes (% of profit) 0.3 Page 45   Totals 18 52 35.4 Doing Business 2018 San Marino Details – Paying Taxes in San Marino – Tax by Type Taxes by type Answer Profit tax (% of profit) 5.1 Labor tax and contributions (% of profit) 30.0 Other taxes (% of profit) 0.3 Details – Paying Taxes in San Marino – Measure of Quality Answer Score Post ling index (0-100) 67.80 VAT refunds Does VAT exist? No Does a VAT refund process exist per the case study? N/A Restrictions on VAT refund process N/A Percentage of cases exposed to a VAT audit (%) Not applicable Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) No VAT No VAT Time to obtain a VAT refund (weeks) No VAT No VAT Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 25% - 49% Time to comply with a corporate income tax audit (hours) 13.0 78.9 Time to complete a corporate income tax audit (weeks) 13.9 56.7 Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 46   Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Doing Business 2018 San Marino Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) Traffic delays and road police checks while from its natural import partner—the economy from which it imports the shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 47   of agriculture or industry, national security agencies and any other Doing Business 2018 San Marino government authorities. Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Time to export: Border compliance (hours) 0 28.0 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 0 191.4 149.9 0.00 (19 Economies) Time to export: Documentary compliance 1 27.9 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 0 113.8 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 4 25.9 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 50 185.1 111.6 0.00 (27 Economies) Time to import: Documentary compliance 3 27.3 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 100 94.7 25.6 0.00 (30 Economies) Figure – Trading across Borders in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 97.48: San Marino (Rank: 20) 93.72: Greece (Rank: 29) 91.01: Malta (Rank: 41) 88.44: Cyprus (Rank: 45) 83.96: Regional Average (Europe & Central Asia) 100.00: Italy (Rank: 1) Note: The ranking of economies on the ease of trading across borders is determined by sorting their distance to frontier scores for trading across borders. These scores are the simple average of the distance to frontier scores for the time and cost for documentary compliance and border compliance to export and import (domestic transport is not used for calculating the ranking). Figure – Trading across Borders in San Marino – Time and Cost Time Cost 4.5 120 4 4 100 100 3.5 3 3 80 Time (hours) Cost (USD) 2.5 50 60 2 1.5 40 1 1 20 0.5 0 0 0 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary CompliancePage 48   Doing Business 2018 San Marino Figure – Trading across Borders in San Marino – Time and Cost Time Cost 4.5 120 4 4 100 100 3.5 3 3 80 Time (hours) Cost (USD) 2.5 50 60 2 1.5 40 1 1 20 0.5 0 0 0 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Details – Trading across Borders in San Marino Characteristics Export Import Product HS 84 : Nuclear reactors, boilers, machinery and mechanical HS 8708: Parts and accessories of appliances; parts thereof motor vehicles Trade partner Italy Germany Border San Marino- Italy border crossing San Marino- Italy border crossing Distance (km) 15 15 Domestic transport 1 1 time (hours) Domestic transport 70 70 cost (USD) Details – Trading across Borders in San Marino – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 0.0 0.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 0.0 0.0 Import: Clearance and inspections required by customs authorities 4.0 50.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 0.0 0.0 Details – Trading across Borders in San Marino – Trade Documents Export Import Page 49   cost (USD) Doing Business 2018 San Marino Details – Trading across Borders in San Marino – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 0.0 0.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 0.0 0.0 Import: Clearance and inspections required by customs authorities 4.0 50.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 0.0 0.0 Details – Trading across Borders in San Marino – Trade Documents Export Import CMR Customs Import Declaration Commercial Invoice Commercial Invoice Packing List Packing List CMR Tax Declaration T2 certificate Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) Page 50   - The seller sues the buyer before the court with jurisdiction over T2 certificate Doing Business 2018 San Marino Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000. Court structure and proceedings (-1-5) - The seller requests a pretrial attachment to secure the claim. Case management (0-6) - The dispute on the quality of the goods requires an expert opinion. Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. Alternative dispute resolution (0-3) - The seller enforces the judgment through a public sale of the buyer’s movable assets. Standardized Case Claim value EUR 86,851.00 Court name Commissario della Legge (Tribunale Unico Ordinario) City Covered San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Time (days) 575 489.9 577.8 164.00 (Singapore) Cost (% of claim value) 13.9 26.2 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 5.5 10.0 11.0 15.50 (Australia) Figure – Enforcing Contracts in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 67.57: Malta (Rank: 37) 65.38: Regional Average (Europe & Central Asia) 59.25: San Marino (Rank: 78) Page 51   of judicial processes Quality Business Doing 2018 San index (0-18) Marino 5.5 10.0 11.0 15.50 (Australia) Figure – Enforcing Contracts in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 67.57: Malta (Rank: 37) 65.38: Regional Average (Europe & Central Asia) 59.25: San Marino (Rank: 78) 54.79: Italy (Rank: 108) 50.19: Greece (Rank: 131) 48.59: Cyprus (Rank: 138) Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their distance to frontier scores for enforcing contracts. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Enforcing Contracts in San Marino – Time and Cost Time Cost 1800 30 26.2 1580 1600 23.1 25 Cost (% of claim value) 1400 21.5 21.5 1200 1100 1120 20 Time (days) 16.4 1000 14.4 13.9 15 800 577.8 575 600 489.9 505 10 400 5 200 0 0 Cyprus Europe & Greece Italy Malta OECD high income San Marino Central Asia Figure – Enforcing Contracts in San Marino and comparator economies – Measure of Quality San Marino 1.5 1 1.5 1.5 Cyprus 2.5 1.5 1 3 Greece 2.5 4.5 2 3 Italy 3 4 3 3 Malta 2.5 4 1 3 OECD high income 2.5 2.9 2 3.6 Europe & Central Asia 2.1 2.9 1.5 3.5 0 2 4 6 8 10 12 Page 52   14 Cyprus Europe & Greece Italy Malta OECD high income San Marino Central Asia Doing Business 2018 San Marino Figure – Enforcing Contracts in San Marino and comparator economies – Measure of Quality San Marino 1.5 1 1.5 1.5 Cyprus 2.5 1.5 1 3 Greece 2.5 4.5 2 3 Italy 3 4 3 3 Malta 2.5 4 1 3 OECD high income 2.5 2.9 2 3.6 Europe & Central Asia 2.1 2.9 1.5 3.5 0 2 4 6 8 10 12 14 Sub-Indicator Score Alternative dispute resolution (0­3) Case management (0­6) Court automation (0­4) Court structure and proceedings (­1­5) Details – Enforcing Contracts in San Marino Indicator Time (days) 575 Filing and service 45 Trial and judgment 350 Enforcement of judgment 180 Cost (% of claim value) 13.9 Attorney fees 10.5 Court fees 2.9 Enforcement fees 0.5 Quality of judicial processes index (0-18) 5.5 Court structure and proceedings (-1-5) 1.5 Case management (0-6) 1.0 Court automation (0-4) 1.5 Alternative dispute resolution (0-3) 1.5 Details – Enforcing Contracts in San Marino – Measure of Quality Page 53   Alternative dispute resolution (0-3) 1.5 Doing Business 2018 San Marino Details – Enforcing Contracts in San Marino – Measure of Quality Answer Score Quality of judicial processes index (0-18) 5.5 Court structure and proceedings (-1-5) 1.5 1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0 2. Small claims court 0.0 2.a. Is there a small claims court or a fast-track procedure for small claims? No 2.b. If yes, is self-representation allowed? n.a. 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, but manual 0.5 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 1.0 1. Time standards 0.0 1.a. Are there laws setting overall time standards for key court events in a civil case? No 1.b. If yes, are the time standards set for at least three court events? n.a. 1.c. Are these time standards respected in more than 50% of cases? n.a. 2. Adjournments 0.0 2.a. Does the law regulate the maximum number of adjournments that can be No granted? 2.b. Are adjournments limited to unforeseen and exceptional circumstances? No 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? n.a. 3. Can two of the following four reports be generated about the competent court: (i) Yes 1.0 time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the No 0.0 competent court? 5. Are there any electronic case management tools in place within the competent court No 0.0 for use by judges? 6. Are there any electronic case management tools in place within the competent court No 0.0 for use by lawyers? Court automation (0-4) 1.5 1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 the competent court? 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? Page 54   1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 Businesscourt? the competent Doing 2018 San Marino 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? 3. Can court fees be paid electronically within the competent court? Yes 1.0 4. Publication of judgments 0.5 4.a Are judgments rendered in commercial cases at all levels made available to the No general public through publication in o cial gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme Yes court level made available to the general public through publication in o cial gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 1.5 1. Arbitration 1.5 1.a. Is domestic commercial arbitration governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public No order or public policy—that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes 2. Mediation/Conciliation 0.0 2.a. Is voluntary mediation or conciliation available? No 2.b. Are mediation, conciliation or both governed by a consolidated law or n.a. consolidated chapter or section of the applicable code of civil procedure encompassing substantially all their aspects? 2.c. Are there nancial incentives for parties to attempt mediation or conciliation (i.e., n.a. if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Page 55   Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Doing Business 2018 San Marino Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent Court fees in local currency of USD 200,000, whichever is greater. - The hotel has a loan from a domestic bank, secured by a mortgage over Fees of insolvency administrators the hotel’s real estate. The hotel cannot pay back the loan, but makes Lawyers’ fees enough money to operate otherwise. Assessors’ and auctioneers’ fees In addition, Doing Business evaluates the adequacy and integrity of the Other related fees existing legal framework applicable to liquidation and reorganization Outcome proceedings through the strength of insolvency framework index. The index tests whether economies adopted internationally accepted good Whether business continues operating as a going practices in four areas: commencement of proceedings, management of concern or business assets are sold piecemeal debtor’s assets, reorganization proceedings and creditor participation. Recovery rate for creditors Measures the cents on the dollar recovered by secured creditors Outcome for the business (survival or not) determines the maximum value that can be recovered Official costs of the insolvency proceedings are deducted Depreciation of furniture is taken into account Present value of debt recovered Strength of insolvency framework index (0- 16) Sum of the scores of four component indices: Commencement of proceedings index (0-3) Management of debtor’s assets index (0-6) Reorganization proceedings index (0-3) Creditor participation index (0-4) Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Recovery rate (cents on the dollar) 47.2 38.0 71.2 93.1 (Norway) Time (years) 2.3 2.3 1.7 0.4 (Ireland) Page 56   Cost (% of estate) 5.0 13.1 9.1 1.00 (Norway) Creditor participation index (0-4) Doing Business 2018 San Marino Europe & OECD high Indicator San Marino Central Asia income Overall Best Performer Recovery rate (cents on the dollar) 47.2 38.0 71.2 93.1 (Norway) Time (years) 2.3 2.3 1.7 0.4 (Ireland) Cost (% of estate) 5.0 13.1 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 0 .. .. .. concern) Strength of insolvency framework index (0-16) 4.5 10.8 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in San Marino and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 78.46: Cyprus (Rank: 21) 76.97: Italy (Rank: 24) 55.59: Greece (Rank: 57) 54.19: Regional Average (Europe & Central Asia) 39.48: San Marino (Rank: 109) 38.07: Malta (Rank: 117) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Figure – Resolving Insolvency in San Marino – Time and Cost Time Cost 4 25 3.5 22.0 3.5 3.0 20 3 Cost (% of estate) Time (years) 2.5 14.5 2.3 2.3 13.1 15 2 1.8 1.7 1.5 10.0 9.0 9.1 10 1.5 1 5.0 5 0.5 0 0 Cyprus Europe & Greece Italy Malta OECD high income San Marino Central Asia Figure – Resolving Insolvency in San Marino and comparator economies – Measure of Quality San Marino 2 1.5 0 1 Page 57   Cyprus 5 3 2 2.5 Cyprus Europe & Greece Italy Malta OECD high income San Marino Central Asia Doing Business 2018 San Marino Figure – Resolving Insolvency in San Marino and comparator economies – Measure of Quality San Marino 2 1.5 0 1 Cyprus 5 3 2 2.5 Greece 5.5 2.5 1 3 Italy 5.5 3 2 3 Malta 2 2.5 1 0 OECD high income 5.4 2.8 2.3 1.9 Europe & Central Asia 4.4 2.6 2.1 1.8 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0­6) Commencement of proceedings index (0­3) Creditor participation index (0­4) Reorganization proceedings index (0­3) Figure – Resolving Insolvency in San Marino and comparator economies – Recovery Rate Recovery Rate (cents on the dollar) 80 73.2 70 64.6 60 50 47.2 38.8 38.0 40 33.6 30 20 10 0 San Marino Cyprus Greece Italy Malta Europe & Central Asia Details – Resolving Insolvency in San Marino Indicator Answer Explanation Proceeding liquidation Considering the assumptions of the case study, the most likely procedure applicable in San (after an Marino would be an attempt to a "concordato preventivo", which would be followed by attempt at liquidation (fallimento), regulated under Legge 17 of November 15, 1915. In this procedure, reorganization) an insolvent debtor will try to reach an agreement with its creditors negotiating the rescheduling and reduction of the debt. Following his application, an automatic stay (moratorium) would apply to all executive actions and an insolvency representative would be appointed ("curatore") to manage the business while the process is ongoing. After creditors file their claims with the court ("insinuazioni"), the process can be terminated under two different alternatives: either the creditors accept a rescheduling and reduction of their claims proposed by the debtor at the beginning of the filing ("concordato") or the company is liquidated piecemeal if the debtor’s proposal is rejected ("fallimento"). In San Marino, a "fallimento" would be the most likely option, as it is the procedure that applies more commonly to small and medium size companies in financial distress. Very few Page 58   San Marino Cyprus Greece Italy Malta Europe & Central Asia Doing Business 2018 San Marino Details – Resolving Insolvency in San Marino Indicator Answer Explanation Proceeding liquidation Considering the assumptions of the case study, the most likely procedure applicable in San (after an Marino would be an attempt to a "concordato preventivo", which would be followed by attempt at liquidation (fallimento), regulated under Legge 17 of November 15, 1915. In this procedure, reorganization) an insolvent debtor will try to reach an agreement with its creditors negotiating the rescheduling and reduction of the debt. Following his application, an automatic stay (moratorium) would apply to all executive actions and an insolvency representative would be appointed ("curatore") to manage the business while the process is ongoing. After creditors file their claims with the court ("insinuazioni"), the process can be terminated under two different alternatives: either the creditors accept a rescheduling and reduction of their claims proposed by the debtor at the beginning of the filing ("concordato") or the company is liquidated piecemeal if the debtor’s proposal is rejected ("fallimento"). In San Marino, a "fallimento" would be the most likely option, as it is the procedure that applies more commonly to small and medium size companies in financial distress. Very few reorganizations "concordati" are actually approved. Outcome piecemeal sale Even if it is very likely that the company will continue operating after filing for insolvency ("concordato preventivo") to maximize the value of the assets, the "fallimento" always implies the sale of the business piecemeal, and the concordato will almost always imply the liquidation too. Therefore, once the "fallimento" is declared, the business will stop operating and will be sold piecemeal. Time (in years) 2.3 Assuming a reorganization attempt ("concordato preventivo") that is then rejected and liquidation ("fallimento") starts, our estimates indicate that the total time that this case would take would be 2.3 years. Within this estimate, the "concordato preventivo" would take approximately 1,3 years, including the time to appoint a "curatore", to file creditors’ claims ("insinuazioni") and to hold the first creditors meeting, which would be closed with a judgement ("sentenza") declaring the "fallimento". After this, new "insinuazioni" would have to take place, and the organization of the public auction ("asta pubblica") and the final transfer of the assets of the debtor would take around another year. Cost (% of 5.0 Assuming a reorganization attempt ("concordato preventivo") that is then rejected and estate) liquidation ("fallimento") starts, our estimate would be that it would approximately cost 5% of the total value of the estate (140,000 EUR) to close the procedure, broken down like this: - 800 EUR as Court Fees for filing the case - 126,000 EUR on the fees of the "curatore", according to "compensi spettanti all'avvocato per la funzione di curatore" - 675,000 EUR on the lawyer's fees, according to the article 30 and article 26 of the "tariffario professionale del commercialista" Recovery rate (cents on the 47.2 dollar) Details – Resolving Insolvency in San Marino – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 4.5 Commencement of proceedings index (0-3) 1.5 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both Page 59   liquidation and dollar) Doing Business 2018 San Marino Details – Resolving Insolvency in San Marino – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 4.5 Commencement of proceedings index (0-3) 1.5 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (b) Yes, but a 0.5 creditor may le for liquidation only What basis for commencement of the insolvency proceedings is allowed under the (e) Other 0.0 insolvency framework? Management of debtor's assets index (0-6) 2.0 Does the insolvency framework allow the continuation of contracts supplying essential No 0.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome No 0.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit No 0.0 after commencement of insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (c) No priority is 0.0 assigned to post- commencement creditors Reorganization proceedings index (0-3) 1.0 Which creditors vote on the proposed reorganization plan? (b) Only creditors 1.0 whose rights are a ected by the proposed plan Does the insolvency framework require that dissenting creditors in reorganization No 0.0 receive at least as much as what they would obtain in a liquidation? Are the creditors devided into classes for the purposes of voting on the reorganization No 0.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 0.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Page 60   Creditor Doing participation Business 2018 index (0-4) San Marino 0.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial No 0.0 assets of the debtor? Does the insolvency framework provide that a creditor has the right to request No 0.0 information from the insolvency representative? Does the insolvency framework provide that a creditor has the right to object to No 0.0 decisions accepting or rejecting creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for Page 61   work of equal value and nondiscrimination based on the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Doing Business 2018 San Marino Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for work of equal value and nondiscrimination based on gender in hiring; (ii) whether law mandates paid or unpaid maternity leave; (iii) length of paid maternity leave; (iv) whether employees on maternity leave receive 100% of wages; (v) availability of ve fully paid days of sick leave a year; (vi) eligibility requirements for unemployment protection. Details – Labor Market Regulation in San Marino Answer Hiring Page 62   Fixed-term contracts prohibited for permanent tasks? Yes days of sick leave a year; (vi) eligibility requirements for unemployment protection. Doing Business 2018 San Marino Details – Labor Market Regulation in San Marino Answer Hiring Fixed-term contracts prohibited for permanent tasks? Yes Maximum length of a single xed-term contract (months) 12.0 Maximum length of xed-term contracts, including renewals (months) 18.0 Minimum wage applicable to the worker assumed in the case study (US$/month) 2147.1 Ratio of minimum wage to value added per worker 0.4 Maximum length of probationary period (months) 1.6 Working hours Standard workday 8.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 35.0 Premium for work on weekly rest day (% of hourly pay) 0.0 Premium for overtime work (% of hourly pay) 26.3 Restrictions on night work? No Whether nonpregnant and nonnursing women can work the same night hours as men Yes Restrictions on weekly holiday? No Restrictions on overtime work? No Paid annual leave for a worker with 1 year of tenure (working days) 26.0 Paid annual leave for a worker with 5 years of tenure (working days) 26.0 Paid annual leave for a worker with 10 years of tenure (working days) 26.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 26.0 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party noti cation if one worker is dismissed? Yes Third-party approval if one worker is dismissed? Yes Third-party noti cation if nine workers are dismissed? Yes Third-party approval if nine workers are dismissed? Yes Retraining or reassignment obligation before redundancy? No Page 63   Third-party Doing approval Business 2018 if nine Sanworkers Marinoare dismissed? Yes Retraining or reassignment obligation before redundancy? No Priority rules for redundancies? Yes Priority rules for reemployment? Yes Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure 0.0 Notice period for redundancy dismissal for a worker with 5 years of tenure 0.0 Notice period for redundancy dismissal for a worker with 10 years of tenure 0.0 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 0.0 Severance pay for redundancy dismissal for a worker with 1 year of tenure 0.0 Severance pay for redundancy dismissal for a worker with 5 years of tenure 0.0 Severance pay for redundancy dismissal for a worker with 10 years of tenure 0.0 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 0.0 Job quality Equal remuneration for work of equal value? No Gender nondiscrimination in hiring? No Paid or unpaid maternity leave mandated by law? Yes Minimum length of maternity leave (calendar days)? 630.0 Receive 100% of wages on maternity leave? No Five fully paid days of sick leave a year? Yes Unemployment protection after one year of employment? Yes Minimum contribution period for unemployment protection (months)? 9.0 Business Reforms in San Marino In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for San Marino implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2017 Dealing with Construction Permits: San Marino made dealing with construction permits easier and cheaper by reducing the cost and streamling the process of obtaining a structural authorization Paying Taxes: San Marino made paying taxes less costly by introducing a 50% reduction of corporate income tax for new companies. DB2016 Page 64   Starting a Business: San Marino made starting a business easier by encouraging the use of the online system for obtaining the Minimum contribution period for unemployment protection (months)? 9.0 Doing Business 2018 San Marino Business Reforms in San Marino In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for San Marino implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2017 Dealing with Construction Permits: San Marino made dealing with construction permits easier and cheaper by reducing the cost and streamling the process of obtaining a structural authorization Paying Taxes: San Marino made paying taxes less costly by introducing a 50% reduction of corporate income tax for new companies. DB2016 Starting a Business: San Marino made starting a business easier by encouraging the use of the online system for obtaining the operator code and business license as well eliminating the requirement for the police inspection before formally operating. DB2015 Starting a Business: San Marino made starting a business easier by removing the requirement for a on-site inspection before formally operating. Registering Property: San Marino made transferring property easier by lowering the property registration tax rate. Page 65   formally operating. Registering Doing 2018SanSan Property: Business Marino made transferring property easier by lowering the property registration tax rate. Marino Page 66