Guidelines for processing Business Permits, Related Clearances and Licenses in All Cities and Municipalities under ARTA-DTI-DILG-DICT-Joint Memorandum Circular No. 01, Series of 2021

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Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.

 

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AT A GLANCE:

During the height of the pandemic, new challenges have emerged. Physical transactions were limited in compliance with health protocols and thus, government services were completely automated including national and local business registration processes. 

 

On May 18, 2018, Republic Act (RA) No. 11032 or otherwise known as the Ease of Doing Business and Efficient Government Service Delivery Act of 2018 was signed into law strengthening the former Anti-Red Tape Act of 2007. It specifically mandated Local Government Units (LGUs) and the Bureau of Fire Protection (BFP) to streamline their respective procedures and authorized the Anti-Red Tape Authority (ARTA) to recommend policies, processes, and systems to improve regulatory management to increase the productivity, efficiency, and effectiveness of business permitting, and licensing agencies, and provide technical assistance and advisory opinions in the review of existing procedures to ensure timely delivery of services to the public. 

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Scope and Coverage: This Joint Memorandum Circular (JMC) covers all Cities and Municipalities, Regional and Provincial Offices of the Department of Interior and Local Government (DILG), the Department of Trade and Industry (DTI), the Department of Information and Communications Technology (DICT), and the Anti-Red Tape Authority (ARTA), the Bureau of Fire Protection (BFP), and all other agencies involved in the business permitting and licensing process of LGUs in view of the general welfare of their inhabitants as it regulates the business operations of individuals, corporations, partnerships, and cooperatives. 

 

Persons and Establishments Requiring Business Permits

A business permit is issued for the purpose of regulating any business or undertaking within the jurisdiction of LGU, which is essentially an exercise of the police power of the State within the contemplation of the Local Government Code. It shall be required by the LGUs from the following:

 

1. An individual, partnership, corporation or cooperative regularly engaged in trade or commercial activity as a means of livelihood or with a view to profit in the city of municipality;
2. Persons legally authorized to practice their profession and maintain or operate a clinic or office, exclusively for their exercise of their profession, at no cost from the concerned LGU, during the registration of office/clinic and renewal thereof, subject to a duly enacted local ordinance. 

 

Exemptions from securing business permits: Business Permits shall not be required from:

1. Professionals who, in the practice of their profession, have paid the professional taxes in the provinces, city or the lone municipality within the Metropolitan Manila Area where he/she practices her profession. However, as stipulated under the provisions of DOF-LFC No. 001-2019 dated 12 June 2021, the professional who maintains an office or clinic for his/her practice shall be issued a business permit at no cost;
2. Individuals or those registered in the Securities and Exchange Commission (SEC) as a One Person Corporation (OPC) who provide personal services that do not fall under the exercise of profession; provided further, that the individual does not occupy a permanent work or retail space, whether inside the residence or any commercial space;
3. Service contractors providing temporary or outsourced services outside the LGU where it registered its principal office or branch; and
4. Barangay Micro Business Enterprises pursuant to RA Nos. 9178 and 10644.

 

Policy Directions: LGUs shall follow the guiding principles below in streamlining the processing of Business Permits and other related permits, clearances, and authorization:

 

1. Review their current processes in issuing business permits and other ancillary permits and clearances following the principles below and required health protocols issued by DOH, and other agencies, such as but not limited to physical distancing, and limited contact between clients and officials:

 

1. Consider the end-to-end processes that cover not only the issuance of the business permit by the Business Permits and Licensing Office (BPLO) but also the issuance of ancillary permits such as the Sanitation Permit by the City/Municipal Health Office, Environmental Clearance by the Environmental Office, Tax Declaration by the Assessor’s Office, Barangay Business Clearance by the Barangays, and the Fire Safety Inspection Certificate (FSIC) by BFP;
2. Retain only such steps, procedures, and requirements that are necessary to allow LGUs to fulfill their legal mandate and the policy objectives of their enabling law;
3. Remove redundant and unduly burdensome processes, procedures, and requirements;
4. Adopt processes that are the least costly to the transacting public, while giving due regard to the LGUs legal mandate and the policy objectives of the enabling law; and
5. Observe the whole-of-government approach which promotes data sharing, simultaneous assessment of application by LGU departments and the BFP, the one-time assessment and payment of business taxes and fees and organization of joint inspection teams.

 

2. Update their respective Citizen’s Charters relative to the issuance of business permits, licenses, and related clearances, compliant with ARTA Memorandum Circular No. 2019-002 and ARTA Memorandum Circular No. 2019-002-A, noting that any document, cost, or procedure not in the Citizen’s Charter shall not be required from the applicant/requesting party;

 

3. Maximize the use of technology as the best way to implement zero-contact policy through the setting up of the Electronic Business One Stop Shop (eBOSS);

 

4. Comply with the relevant provisions of RA No. 10173 and related rules and regulations, in the collection and processing of personal and sensitive information from data subjects and sharing this information to authorized the offices of LGUs and other government agencies relating to the processing of business permits and related clearances and licenses;

 

5. Forge data sharing arrangements/agreements within the different offices or units in the LGU. 

 

Unified Application Form

1. LGUs shall provide a single or unified application form (UAF) for business registration, applicable for both new applications and renewals, which consolidates all the information needed by the BPLO, the Planning and Development Office, the Health Office, the Treasurer’s Office, the Environment Office, the BFP, and other offices involved in the business registration. This unified form shall serve as the application form for the Business Permit, the FSIC for business, the Locational Clearance or its equivalent, the Sanitary Permit, and the Environmental Permit, if required. 

1. The UAF shall be assigned a unique identification number, which will be used as the identifying number for all subsequent transactions between the LGU and the applicant, in relation to the said application.
2. The UAF shall be posted online or in the LGU website using the technology-neutral platforms. It shall be in “editable” format which can be filled out electronically, saved and/or printed.
3. Hard copies of the UAF shall always be made freely available in the designated areas in the city/municipal hall or the National Government Offices (NGAs) involved in business registration.
4. LGUs shall not require the notarization of the application forms both for new and renewal applications. 
5. The LGU shall establish data-sharing mechanisms that will allow the transmission of the information from the UAF to all relevant offices of the city or municipality and the BFP, among others, to facilitate simultaneous processing of the application; Provided, that only the specific information required by an office or department shall be shared; Provided, further, that the sharing of personal and sensitive personal information shall comply with the provisions of the Data Privacy Act of 2012; Provided, finally, that if data and information will be shared online and stored in electronic databases, the LGU, in coordination with the DICT, shall adopt the necessary policies, processes, and procedures to ensure that their data centers and other computerized systems are effectively protected against cyber-threats and unauthorized access from attackers and malicious content.

 

2. For LGUs with an online system for the submission of application form and documentary requirements where the applicants are differentiated into those applying for new business permits and renewals.

 

Business One Stop Shops: LGUs shall set up a one-stop business facilitation for service, also known as Business One-Stop Shops (BOSS) to receive and process manual and/or electronic submission of applications for licenses, clearances, permit, or authorization, release tax bills, accept payments and release permits and other documents related to the application of Business Permit. 

 

Electronic BOSS

a.  Consistent with the ARTA’s zero-contact policy and health protocols mandated by the government, LGUs are mandated to automate their Business Permits and Licensing System (BPLS) or set up an eBOSS not later than June 21, 2021. An eBOSS shall have the following functionalities:

1. Accept online or electronic submission of business permit applications using the UAF which an applicant can fill up or edit;
2. Issue electronically the tax bill/order payment which indicates the amount that the applicant has to pay covering the business tax, fees, and charges;
3.  Accept online payments using online payment facilities and other payment gateways or alternative digital payment options;
4. Issue electronic versions of permits, licenses or clearances, which may be printed by the businesses at the convenience of their offices, and which have the same authority as hard copies usually issued by LGUs;
5. Provide gateway facility linked with courier services to allow physical delivery of permits, clearances, and other documents issued in relation to a business registration in cases where the applicant prefers to receive the hard copy of the permit. 

 

b. LGUs shall ensure that a customer system is in place at least during work hours to receive and address the inquiries of concerned applicants about the eBOSS system that are technical in nature, such as, but not limited to glitches, errors, and sign-in difficulties. 

 

c. LGUs, which currently have no eBOSS are encouraged to utilize the DICT’s Integrated Business Permits and Licensing System (iBPLS) directly or through the ARTA Platform. The non-exclusivity of all the eBOSS platforms to onboard relevant features shall be observed.

 

d. An online complaints and feedback mechanism related to business permitting shall be integrated or made available in the eBOSS of the LGUs. 

 

Single Application for Lease of Multiple Real Properties

 

LGUs shall simplify the requirements relative to any permit or license to be issued for an applicant engaged in the business of leasing multiple real properties within the same city or municipality. Such applicant shall be required to file a single application only for all of the properties subject of the business and shall simply submit a list of all such properties, indicating the amount of income derived therein. There shall likewise be a single assessment of the taxes, fees, or charges to be paid for all the properties. 

 

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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding legal services, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/ 0917-5772207/ 09778050020.

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