Ministry starts one-stop business licensing portal

By Samuel Sanya

The Ministry of Finance is set to run an e-licensing portal indicating where local investors should go to get licenses for restaurants, kiosks, schools and other business to stem bribery and bring down the cost of doing business.

The e-licensing portal will be launched in March as part of changes by the 15-member Business Licensing Reform Committee (BLRC) set up three years ago in the finance ministry.

Winifred Kiryabwire, a ministry of finance official, said the committee discovered that many licenses are outdated and that there are overlaps in licenses, levies, fees, and permits at national and local government levels. Businesses are spending over sh725.73b or 3.49% of GDP each year in business licences, reducing profit margins for entrepreneurs and slowing job creation.

“Businesses are spending more on compliance with the law than in running the enterprise. A single business may be subject to multiple licenses, and entrepreneurs are relying on rumors with the absence of clear licensing procedures,” she said.

“We have recruited staff for the e-licensing bureau and the portal shall be active in March. The portal will have information about the licensing regimes for each business,” Kiryabwire added.

The BLRC report indicates that there are 780 licenses issued by both central and local government agencies, with 554 issued by the central government and 226 by local governments as a source of revenue and not for business regulation.

The hospitality industry has been hit the most by licensing fees, as each hotel requires separate licences to run a pool, a bar, restaurant and to host foreign tourists, pushing up hotel fees for clients.

Kiryabwire noted that 43% of the total licencing fees go to administrative costs of obtaining these licenses.