Economy Profile Haiti - Doing Business 2020

Doing Business 2020 Haiti Page 1 Economy Profile Haiti Doing Business 2020 Haiti Economy Profile of Haiti Doing Business 2020 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 permits Procedures, time and cost to complete all formalities to build a warehouse and the quality control and safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, and 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, total tax and contribution rate for a firm to comply with all tax regulations as well as postfiling 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 Employing workers Flexibility in employment regulation and redundancy cost Page 2 Doing Business 2020 Haiti About Doing Business Doing Business The project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. Doing Business The 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 firms. 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 Doing Business Doing Business borders, enforcing contracts and resolving insolvency. also measures features of employing workers. Although does not present rankings of economies on the employing workers indicators or include the topic in the aggregate ease of doing business score or ranking on the ease of doing business, it does present the data for these indicators. Doing Business By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, encourages economies to compete towards more efficient regulation; offers 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. Doing Business subnational studies In addition, offers detailed , which exhaustively cover business regulation and reform in different cities and regions within a nation. These studies provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected Doing Business cities can compare their business regulations with other cities in the economy or region and with the 190 economies that has ranked. Doing Business The first study, published in 2003, covered 5 indicator sets and 133 economies. This year’s study 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 Doing Business (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where 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 benefited 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. To learn more about Doing Business please visit doingbusiness.org Page 3 Doing Business 2020 Haiti Ease of Doing Business in Haiti Rankings on Doing Business topics - Haiti 147 Region Latin America & Caribbean Income Category Low income Population 11,123,176 City Covered Port au Prince 144 149 DB RANK DB SCORE 40.7 179 85 127 168 189 179 182 183 Starting a Business Topic Scores Dealing with Construction Permits Getting Electricity Registering Property Getting Credit Protecting Minority Investors Paying Taxes Trading across Borders Enforcing Contracts Resolving Insolvency 36.4 44.2 57.2 30.4 35.0 18.0 57.6 76.9 51.6 0.0 Starting a Business (rank) 189 Score of starting a business (0-100) 36.4 Procedures (number) 12 Time (days) 97 Cost (number) 179.7 Paid-in min. capital (% of income per capita) 11.0 Dealing with Construction Permits (rank) 179 Score of dealing with construction permits (0-100) 44.2 Procedures (number) 14 Time (days) 97 Cost (% of warehouse value) 21.9 Building quality control index (0-15) 5.0 Getting Electricity (rank) 147 Score of getting electricity (0-100) 57.2 Procedures (number) 4 Time (days) 60 Cost (% of income per capita) 2,946.7 Reliability of supply and transparency of tariff index (0-8) 0 Registering Property (rank) 182 Score of registering property (0-100) 30.4 Procedures (number) 6 Time (days) 319 Cost (% of property value) 6.8 Quality of the land administration index (0-30) 2.5 Getting Credit (rank) 144 Score of getting credit (0-100) 35.0 Strength of legal rights index (0-12) 2 Depth of credit information index (0-8) 5 Credit registry coverage (% of adults) 5.3 Credit bureau coverage (% of adults) 0.0 Protecting Minority Investors (rank) 183 Score of protecting minority investors (0-100) 18.0 Extent of disclosure index (0-10) 2.0 Extent of director liability index (0-10) 3.0 Ease of shareholder suits index (0-10) 4.0 Extent of shareholder rights index (0-6) 0.0 Extent of ownership and control index (0-7) 0.0 Extent of corporate transparency index (0-7) 0.0 Paying Taxes (rank) 149 Score of paying taxes (0-100) 57.6 Payments (number per year) 47 Time (hours per year) 184 Total tax and contribution rate (% of profit) 42.7 Postfiling index (0-100) 48.2 Trading across Borders (rank) 85 Score of trading across borders (0-100) 76.9 Time to export Documentary compliance (hours) 22 Border compliance (hours) 28 Cost to export Documentary compliance (USD) 48 Border compliance (USD) 368 Time to export Documentary compliance (hours) 28 Border compliance (hours) 83 Cost to export Documentary compliance (USD) 150 Border compliance (USD) 563 Enforcing Contracts (rank) 127 Score of enforcing contracts (0-100) 51.6 Time (days) 530 Cost (% of claim value) 42.6 Quality of judicial processes index (0-18) 6.5 Resolving Insolvency (rank) 168 Score of resolving insolvency (0-100) 0.0 Recovery rate (cents on the dollar) No Practice Time (years) No Practice Cost (% of estate) No Practice Outcome (0 as piecemeal sale and 1 as going concern) Strength of insolvency framework index (0- 16) 0 No Practice Page 4 Doing Business 2020 Haiti Starting a Business This topic measures the number of procedures, time, cost and paid-in minimum capital requirement for a small- to medium-sized limited liability company to start up and formally operate in each economy’s largest business city. Doing Business To make the data comparable across 190 economies, uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times the 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 ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of the scores for each of the component indicators. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Procedures to legally start and formally operate a company (number) • Preregistration (for example, name verification or reservation, notarization) • Registration in the economy’s largest business city • Postregistration (for example, social security registration, company seal) • Obtaining approval from spouse to start a business or to leave the home to register the company • Obtaining any gender specific document for company registration and operation or national identification card Time required to complete each procedure (calendar days) • Does not include time spent gathering information • Each procedure starts on a separate day (2 procedures cannot start on the same day) • Procedures fully completed online are recorded as ½ day • Procedure is considered completed once final document is received • No prior contact with officials Cost required to complete each procedure (% of income per capita) • Official costs only, no bribes • No professional fees unless services required by law or commonly used in practice Paid-in minimum capital (% of income per capita) • Funds deposited in a bank or with third party before registration or up to 3 months after incorporation Case study assumptions To make the data comparable across economies, several assumptions about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay no bribes. The business: -Is a limited liability company (or its legal equivalent). If there is more than one type of limited liability company in the economy, the limited liability form most common among domestic firms is chosen. Information on the most common form is obtained from incorporation lawyers or the statistical office. -Operates in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. -Performs general industrial or commercial activities such as the production or sale to the public of goods or services. The business does not perform foreign trade activities and does not handle products subject to a special tax regime, for example, liquor or tobacco. It is not using heavily polluting production processes. -Does not qualify for investment incentives or any special benefits. -Is 100% domestically owned. -Has five business owners, none of whom is a legal entity. One business owner holds 30% of the company shares, two owners have 20% of shares each, and two owners have 15% of shares each. -Is managed by one local director. -Has between 10 and 50 employees one month after the commencement of operations, all of them domestic nationals. -Has start-up capital of 10 times income per capita. -Has an estimated turnover of at least 100 times income per capita. -Leases the commercial plant or offices and is not a proprietor of real estate. -Has an annual lease for the office space equivalent to one income per capita. -Is in an office space of approximately 929 square meters (10,000 square feet). -Has a company deed that is 10 pages long. The owners: -Have reached the legal age of majority and are capable of making decisions as an adult. If there is no legal age of majority, they are assumed to be 30 years old. -Are in good health and have no criminal record. -Are married, the marriage is monogamous and registered with the authorities. -Where the answer differs according to the legal system applicable to the woman or man in question (as may be the case in economies where there is legal plurality), the answer used will be the one that applies to the majority of the population. Page 5 Doing Business 2020 Haiti Starting a Business - Haiti Standardized Company Legal form Société Anonyme Paid-in minimum capital requirement HTG 6,250 City Covered Port au Prince Indicator Haiti Latin America & Caribbean OECD high income Best Regulatory Performance Procedure – Men (number) 12 8.1 4.9 1 (2 Economies) Time – Men (days) 97 28.8 9.2 0.5 (New Zealand) Cost – Men (% of income per capita) 179.7 31.4 3.0 0.0 (2 Economies) Procedure – Women (number) 12 8.1 4.9 1 (2 Economies) Time – Women (days) 97 28.8 9.2 0.5 (New Zealand) Cost – Women (% of income per capita) 179.7 31.4 3.0 0.0 (2 Economies) Paid-in min. capital (% of income per capita) 11.0 0.4 7.6 0.0 (120 Economies) Figure – Starting a Business in Haiti – Score 35.3 Procedures 3.0 Time 10.2 Cost 97.3 Paid-in min. capital Figure – Starting a Business in Haiti and comparator economies – Ranking and Score DB 2020 Starting a Business Score 0 100 97.4: Jamaica (Rank: 6) 91.2: Puerto Rico (U.S.) (Rank: 59) 85.6: Guyana (Rank: 111) 85.4: Dominican Republic (Rank: 112) 79.6: Regional Average (Latin America & Caribbean) 36.4: Haiti (Rank: 189) Note: The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of the scores for each of the component indicators. Page 6 Doing Business 2020 Haiti Figure – Starting a Business in Haiti – Procedure, Time and Cost Time (days) Cost (% of income per capita) 60 Time (days) Cost (% of income per capita) 50 80 40 60 30 40 20 20 10 0 0 1 2 3 4 5 * 6 * 7 * 8 * 9 * 10 * 11 * 12 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 different procedure list for men and women, the graph shows the Doing Business http://doingbusiness.org/en/methodology time for women. For more information on methodology, see the website ( ). For details on the procedures reflected here, see the summary below. Page 7 Doing Business 2020 Haiti Details – Starting a Business in Haiti – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Prepare the company's articles and memorandum of association Agency : Lawyer The lawyer charges approximately HTG 30,000 for the drafting of the company statutes in the case of a Société Anonyme. Prices can vary depending on the lawyer. 2 Notarize the company deeds and articles of association Agency : Notary The notary public must hand-write and notarize the documents at a fee of between HTG 15,000 and HTG 25,000 depending on the complexity of the service. 3 Deposit the legally required initial capital in the National Bank and obtain deposit evidence Agency : National Bank The lawyer deposits the legally required initial capital in the National Bank (Banque Nationale de Credit) and obtains proof of deposit. A certified check need to be used to pay in the National Bank, where proof of payment is provided. 4 Register the company with the Tax Authorities (Direction Générale des Impôts - DGI) Agency : Tax Authorities (Direction Générale des Impôts - DGI) The notary pays the registration fees at the Tax Office (DGI) and proof of payment is obtained. 5 Registration with the Commercial Registry at the Ministry of Commerce and Industry and obtain the authorization of operations (Droit de fonctionnement) Agency : Ministry of Commerce and Industry and Le Moniteur (Journal Officiel) Lawyer submits the dossier for registration at the Ministry of Commerce and a request for the ‘avis de fonctionnement’. When the Ministry of Commerce has processed the application and registered the company, it forwards the file to the Moniteur for publication. Firms can begin operations before the publication, as soon as they receive authorization from the Ministry of Commerce. Since May 2009, the company’s articles of incorporation do not need to be approved by the Prime Minister’s office and the Presidency before they can be published in the Official Journal. This process takes about 60 days. The cost depends on the number of pages of the act of constitution: 2 to 9 pages: HTG 5,000 10 to 25 pages: HTG 20,000 26 to x pages: HTG 35,000. 10 days HTG 30,000 7 days HTG 15,000 - HTG 25,000 1 day no charge 1 day included in the notary fees 78 days on average HTG 250 (frais de dossier) + HTG 25 (vignette bleue) + HTG 30,000 for publication in Le Moniteur (10-24 pages) 6 Obtain the Tax ID number (Numéro d’identification fiscale - NIF) from the Tax authorities (DGI), pay fees, and obtain the business license (patente) Agency : Tax Authorities (Direction Générale des Impôts - DGI) The company must file a form at the Tax Bureau (DGI) and provide an opening balance sheet on which corporate taxes will be based. A 2% tax is levied on a corporation’s initial capital, payable annually. A company must pay the “tax on share” (taxe sur action) of 0.3% per share, which will be assessed each year, and a "right of operating" tax (droit de fonctionnement) of HTG 1500 payable annually, and HTG 1500 5 to obtain the professional identity card ("carte d’identite professionelle"). 7 Obtain the Professional ID (Carte d’Identité Professionelle) from the Ministry of Commerce and Industry Agency : Ministry of Commerce and Industry According to Article 2 of the “Décret du 26 septembre 1960 réglementant l’exercice de la profession de commercant”, all commercial entities are required to hold a “carte d’identité professionnelle”. After the payment of fees at the DGI and obtaining the business permit ("certificat de patente"), the entrepreneur will obtain the “carte d’identité professionnelle” at the Ministry of Commerce. 8 Obtain special commercial books Agency : Commercial Registry The special commercial books are purchased and prepared by an accountant. 9 Notification of employee registration to the Labor Ministry Agency : Labor Ministry Companies must submit a declaration on the hiring of personnel to the Labor Direction within 8 days of opening. Legalize the commercial books 15 days (simultaneous with previous procedure) 17 days on average (simultaneous with previous procedure) 2 days (simultaneous with previous procedure) 1 day (simultaneous with previous procedure) 7 days (simultaneous HTG 50 (tax ID card) + 2% of initial capital + 0.3% per share + HTG 1500 (droit de fonctionnement) + HTG 1500 (taxe carte d’identite professionelle) cost included in procedure 5 HTG 5,000 no charge HTG 1,000 Agency : Court 10 Books are legalized by the Dean of the first instance court (Doyen du Tribunal). Each page must be sealed by the Dean of the civil court and the books must be sealed at the DGI (Direction Generale des Impots). with previous procedure) Page 8 Doing Business 2020 Haiti 11 Register for social security (OFATMA) 1 day (simultaneous with no charge Agency : Insurance Office (Office d'Assurance Accidents du Travail, Maladie et Maternité - previous procedure) OFATMA) The company must register with the Insurance Office for Occupational Injury, Sickness, and Maternity (OFATMA) within 15 days of opening and provide the names of all its employees (up to 6% of monthly salary is contributed by the employer to social security). Register for Retirement Insurance Office (ONA) Agency : Retirement Office (Office Nationale d'Assurance - ONA) 12 The company must register with the Retirement Insurance Office (ONA) within 15 days of opening and provide the name of all its employees. 1 day (simultaneous with previous procedure) no charge Takes place simultaneously with previous procedure. Page 9 Doing Business 2020 Haiti 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 notifications, 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 certification requirements. The most recent round of data collection was completed in May 2019. See the methodology for more information What the indicators measure Procedures to legally build a warehouse (number) • Submitting all relevant documents and obtaining all necessary clearances, licenses, permits and certificates • Submitting all required notifications and receiving all necessary inspections • Obtaining utility connections for water and sewerage • Registering and selling the warehouse after its completion Time required to complete each procedure (calendar days) • Does not include time spent gathering information • Each procedure starts on a separate day—though procedures that can be fully completed online are an exception to this rule • Procedure is considered completed once final document is received • No prior contact with officials Cost required to complete each procedure (% of income per capita) • Official costs only, no bribes Building quality control index (0-15) • Quality of building regulations (0-2) • Quality control before construction (0-1) • Quality control during construction (0-3) • Quality control after construction (0-3) • Liability and insurance regimes (0-2) • Professional certifications (0-4) Case study assumptions To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility connections are used. The construction company (BuildCo): - Is a limited liability company (or its legal equivalent) and operates in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Is 100% domestically and privately owned; has five owners, none of whom is a legal entity. Has a licensed architect and a licensed engineer, both registered with the local association of architects or engineers. BuildCo is not assumed to have any other employees who are technical or licensed experts, such as geological or topographical experts. - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. The warehouse: - Will be used for general storage activities, such as storage of books or stationery. - Will have two stories, both above ground, with a total constructed area of approximately 1,300.6 square meters (14,000 square feet). Each floor will be 3 meters (9 feet, 10 inches) high and will be located on a land plot of 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. - Will have complete architectural and technical plans prepared by a licensed architect. If preparation of the plans requires such steps as obtaining further documentation or getting prior approvals from external agencies, these are counted as procedures. - Will take 30 weeks to construct (excluding all delays due to administrative and regulatory requirements). The water and sewerage connections: - Will be 150 meters (492 feet) from the existing water source and sewer tap. If there is no water delivery infrastructure in the economy, a borehole will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built. - Will have an average water use of 662 liters (175 gallons) a day and an average wastewater flow 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 flow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater flow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Page 10 Doing Business 2020 Haiti Dealing with Construction Permits - Haiti Standardized Warehouse Estimated value of warehouse HTG 2,850,469.30 City Covered Port au Prince Indicator Haiti Latin America & Caribbean OECD high income Best Regulatory Performance Procedures (number) 14 15.5 12.7 None in 2018/19 Time (days) 97 191.2 152.3 None in 2018/19 Cost (% of warehouse value) 21.9 3.6 1.5 None in 2018/19 Building quality control index (0-15) 5.0 9.0 11.6 15.0 (6 Economies) Figure – Dealing with Construction Permits in Haiti – Score 64.0 Procedures 79.5 Time 0.0 Cost 33.3 Building quality control index Figure – Dealing with Construction Permits in Haiti and comparator economies – Ranking and Score DB 2020 Dealing with Construction Permits Score 0 100 71.9: Jamaica (Rank: 70) 70.7: Dominican Republic (Rank: 80) 63.2: Regional Average (Latin America & Caribbean) 59.6: Puerto Rico (U.S.) (Rank: 143) 52.5: Guyana (Rank: 167) 44.2: Haiti (Rank: 179) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their scores for dealing with construction permits. These scores are the simple average of the scores for each of the component indicators. Page 11 Doing Business 2020 Haiti Figure – Dealing with Construction Permits in Haiti – Procedure, Time and Cost Time (days) Cost (% of warehouse value) 8 7 Cost (% of warehouse value) 80 6 Time (days) 5 60 4 40 3 2 20 1 0 0 1 * 2 3 4 5 6 7 8 9 10 * 11 12 13 * 14 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 different procedure list for men and women, the graph shows the Doing Business http://doingbusiness.org/en/methodology time for women. For more information on methodology, see the website ( ). For details on the procedures reflected here, see the summary below. Page 12 Doing Business 2020 Haiti Figure – Dealing with Construction Permits in Haiti and comparator economies – Measure of Quality 14 12 Index score5.0 10 8 6 4 2 0 13.0 4.0 12.0 12.0 9.0 Haiti Dominican Republic Guyana Jamaica Puerto Rico (U.S.) Latin America & Caribbean Details – Dealing with Construction Permits in Haiti – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Request and obtain a Soil Test Agency : Private Firm The National Building Code of Haiti provides specifications for the strength of the foundation of buildings to resist seismic activities and shrinkage. Therefore, a soil test is needed to identity the type of soil so that the foundation is solid. 2 Obtain a topographical map Agency : Private land surveyor The National Building Code of Haiti provides information on the importance of having a topographic map of the land so that it can be preserved. 3 Request building permit Agency : Municipality and the Ministry of Public Works The Ministry of Public Works does not issue the building permit, but studies the file and provides technical advice/approval of the plans. The Engineering Department will merely give its advice on the feasibility of the project. The building permit is issued by the Municipality. BuildCo must submit the following documents when requesting the permit: • Survey plan and title of ownership (3 copies) • Location plan (3 copies) • Facade plan (3 copies) • Construction (foundation, electricity, plumbing) (3 copies) • Specifications sheet • License of the engineers or Corporate Income Tax (1 copy) – proof that the engineer or the construction company has no outstanding taxes • Letter of Authorization Request (1 copy) 4 Obtain site inspection by engineer from the Municipality Agency : Municipality A request is made for a site inspection. The owner or the engineer must be at the site for the inspection. After this inspection, the Municipality will issue a “Bordereau de paiement” for the fees to be paid. 5 Pay fees at the Municipality and obtain construction permit Agency : Municipality Once the site inspection is done, the municipality will prepare the payment slip "bordereau de paiement". Buildco will obtain the permit once the fees are paid. The fees for the building permit are recorded in procedure 3. 6 Receive inspection to verify the set-out and the foundation Agency : Municipality By law (art. 1.2.3 of the Building Code) the Municipality must verify the set-out and the foundation. However in practice, this inspection does not always take place. 7 Receive inspection for the walls and the quality of materials used Agency : Municipality By law (art. 1.2.3 of the Building Code) the Municipality must verify the raising of the walls and the quality of the material used for the construction. However in practice, this inspection does not always take place. 8 Receive inspection for the verification of the roof slabs Agency : Municipality By law (art. 1.2.3 of the Building Code) the Municipality must verify the roof slap. However in practice, this inspection does not always take place. 9 Receive final inspection Agency : Municipality By law (art. 1.2.6 of the Building Code) the Municipality must conduct a final inspection and then deliver a certificate of conformity. However in practice, this inspection does not always take place. 18 days USD 2,100 7 days USD 750 30 days HTG 195,090 1 day no charge 15 days no charge 1 day no charge 1 day no charge 1 day no charge 1 day no charge Page 13 Doing Business 2020 Haiti 10 Obtain the occupancy certificate Agency : Municipality The certificate of occupancy is issued after the final inspection; however in practice it is rarely done. Obtaining the certificate of conformity is the responsibility of the builder. 11 Request water connection from the National Direction of Potable Water and Sewage (Direction Nationale de l’Eau Potable et de l'Assainissement- DINEPA) Agency : Offices Régionaux d’Eau Potable et d’Assainissement (OREPA) The water connection is requested directly by the owner, as the contract must be made in the owner's name. 12 Receive inspection for water connection and cost estimate Agency : Offices Régionaux d’Eau Potable et d’Assainissement (OREPA) The customer service center will process the application and forward it to the technical department, which will then inspect the construction site to prepare a cost estimate of the work for the water connection. 13 Obtain water connection from the National Direction of Potable Water and Sewage (Direction Nationale de l’Eau Potable et de l'Assainissement- DINEPA) Agency : Offices Régionaux d’Eau Potable et d’Assainissement (OREPA) The cost of connection to the water depends on the width of the pipe used. The size of the pipe in the Doing Business case study is assumed to be 1 inch. Therefore the cost is HTG 6,640 (USD 116). Build septic tank 7 days no charge 1 day no charge 1 day no charge 21 days USD 166 18 days USD 3,000 Agency : Private firm 14 BuildCo is required to build a septic tank due to the lack of sewerage network. Takes place simultaneously with previous procedure. Page 14 Doing Business 2020 Haiti Details – Dealing with Construction Permits in Haiti – Measure of Quality Answer Score Building quality control index (0-15) 5.0 Quality of building regulations index (0-2) 1.0 How accessible are building laws and regulations in your economy? (0-1) Available online; Free 1.0 of charge. Which requirements for obtaining a building permit are clearly specified in the building regulations or on any accessible website, brochure or pamphlet? (0-1) List of required documents. 0.0 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 compliance with existing building regulations? (0-1) Licensed architect; Licensed engineer. 1.0 Quality control during construction index (0-3) 1.0 What types of inspections (if any) are required by law to be carried out during construction? (0-2) Inspections at various 1.0 phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 0.0 inspections are not always done in practice during construction. Quality control after construction index (0-3) 2.0 Is there a final inspection required by law to verify that the building was built in accordance with the approved plans and regulations? (0-2) Yes, final inspection is done by government agency; Final inspection is not required by law. 2.0 Do legally mandated final inspections occur in practice? (0-1) Final inspection does 0.0 not always occur in practice. Liability and insurance regimes index (0-2) 0.0 Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) No party is held liable under the law. No party is required by law to obtain insurance . 0.0 0.0 Professional certifications index (0-4) 0.0 What are the qualification requirements for the professional responsible for verifying that the architectural plans or drawings are in compliance with existing building regulations? (0-2) What are the qualification requirements for the professional who supervises the construction on the ground? (0- 2) University degree in architecture or engineering. University degree in engineering, construction or construction management. 0.0 0.0 Page 15 Doing Business 2020 Haiti 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 tariffs index measures reliability of supply, transparency of tariffs and the price of electricity. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Procedures to obtain an electricity connection (number) • Submitting all relevant documents and obtaining all necessary clearances and permits • Completing all required notifications and receiving all necessary inspections • Obtaining external installation works and possibly purchasing material for these works • Concluding any necessary supply contract and obtaining final supply Time required to complete each procedure (calendar days) • Is at least 1 calendar day • Each procedure starts on a separate day • Does not include time spent gathering information • Reflects the time spent in practice, with little follow-up and no prior contact with officials Cost required to complete each procedure (% of income per capita) • Official costs only, no bribes • Value added tax excluded The reliability of supply and transparency of tariffs index (0-8) • Duration and frequency of power outages (0–3) • Tools to monitor power outages (0–1) • Tools to restore power supply (0–1) • Regulatory monitoring of utilities’ performance (0–1) • Financial deterrents limiting outages (0–1) • Transparency and accessibility of tariffs (0–1) Price of electricity (cents per kilowatt-hour)* • Price based on monthly bill for commercial warehouse in case study Doing Business *Note: measures the price of electricity, but it is not included in the ease of doing business score nor in the ranking on the ease of getting electricity. Case study assumptions To make the data comparable across economies, several assumptions about the warehouse, the electricity connection and the monthly consumption are used. The warehouse: - Is owned by a local entrepreneur and is used for storage of goods. - Is located in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Is located in an area where similar warehouses are typically located and is in an area with no physical constraints. For example, the property is not near a railway. - Is a new construction and is being connected to electricity for the first time. - Has two stories with a total surface area of approximately 1,300.6 square meters (14,000 square feet). The plot of land on which it is built is 929 square meters (10,000 square feet). The electricity connection: - 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, when 1 kVA = 1 kilowatt (kW). - Has a length of 150 meters. The connection is to either the low- or medium-voltage distribution network and is either overhead or underground, whichever is more common in the area where the warehouse is located and requires works that involve the crossing of a 10-meter road (such as by excavation or overhead lines) but are all carried out on public land. There is no crossing of other owners’ private property because the warehouse has access to a road. - 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 panel or switchboard and the meter base. The monthly consumption: - It is assumed that the warehouse operates 30 days a month from 9:00 a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours (kWh); hourly consumption is 112 kWh. - If multiple electricity suppliers exist, the warehouse is served by the cheapest supplier. - Tariffs effective in January of the current year are used for calculation of the price of electricity for the warehouse. Although January has 31 days, for calculation purposes only 30 days are used. Page 16 Doing Business 2020 Haiti Getting Electricity - Haiti Standardized Connection Name of utility Electricité d’Haiti (EdH) Price of electricity (US cents per kWh) 21.1 City Covered Port au Prince Indicator Haiti Latin America & Caribbean OECD high income Best Regulatory Performance Procedures (number) 4 5.5 4.4 3 (28 Economies) Time (days) 60 66.8 74.8 18 (3 Economies) Cost (% of income per capita) 2946.7 407.2 61.0 0.0 (3 Economies) Reliability of supply and transparency of tariff index (0-8) 0 4.4 7.4 8 (26 Economies) Figure – Getting Electricity in Haiti – Score 83.3 Procedures 81.7 Time 63.6 Cost 0.0 Reliability of supply and transparency of tariff index Figure – Getting Electricity in Haiti and comparator economies – Ranking and Score DB 2020 Getting Electricity Score 0 100 73.5: Puerto Rico (U.S.) (Rank: 92) 71.7: Regional Average (Latin America & Caribbean) 68.0: Dominican Republic (Rank: 116) 65.0: Jamaica (Rank: 120) 57.2: Haiti (Rank: 147) 45.9: Guyana (Rank: 170) Note: The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are the simple average of the scores for all the component indicators except the price of electricity. Figure – Getting Electricity in Haiti – Procedure, Time and Cost Time (days) Cost (% of income per capita) Time (days) 60 1600 1400 Cost (% of income per capita) 50 1200 40 1000 30 800 600 20 400 10 200 0 0 1 * 2 3 4 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 different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures Page 17 Doing Business 2020 Haiti reflected here, see the summary below. Figure – Getting Electricity in Haiti and comparator economies – Measure of Quality 6 5 Index score 4 3 2 1 0 0 5 0 5 3 4.4 Haiti Dominican Republic Guyana Jamaica Puerto Rico (U.S.) Latin America & Caribbean Page 18 Doing Business 2020 Haiti Details – Getting Electricity in Haiti – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Hire private contractor to apply for connection and await estimate of connection fees Agency : Electricité d'Haïti External works can be carried out by Electricité d'Haïti (EDH) or by a private contractor provided they have obtained the utility’s approval. The final connection however, is always done by the utility. The common approach is to hire a private contractor (a list of these is available at the utility) to save time and because the utility often lacks the necessary material. The client can also either submits the application for connection themselves or ask their contractor to do so on their behalf. • Request of connection can be done in two ways:By letter from the company head • In person at one of the centers or agencies offering the utility’s services 2 Receive external site inspection by Electricité d'Haïti (EDH) Agency : Electricité d'Haïti The utility then inspects the site and prepares an estimate of the connection fees: • An estimate for the construction of the Low-Voltage of Medium-Voltage line and of the unit substation • An estimate for the construction of the metering system 3 Obtain external works from private contractor Agency : Private firm The private contractor discusses with the client about the technical details of the works (capacity, voltage, etc.) and submits the design to the utility for approval. The contractor also prepares an estimate of the fees for the construction of the lines and unit substation. The contractor will also need to write to the utility to obtain approval to work on the network. 4 Request meter installation and final connection from EDH Agency : Electricité d'Haïti Once the works have been completed the client requests meter installation from Electricité d'Haïti (EDH). No inspection of the entire internal wiring is carried out during the process. For capacities below 300 kVA, the utility normally has the meters (and current transformers) in stock. Takes place simultaneously with previous procedure. 10 calendar days USD 400 1 calendar day HTG 866,917.13 30 calendar days USD 7,500 20 calendar days HTG 250,000 Page 19 Doing Business 2020 Haiti Details – Getting Electricity in Haiti – Measure of Quality Answer Reliability of supply and transparency of tariff index (0-8) 0 Total duration and frequency of outages per customer a year (0-3) 0 System average interruption duration index (SAIDI) .. System average interruption frequency index (SAIFI) .. What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI N/A Mechanisms for monitoring outages (0-1) 0 Does the distribution utility use automated tools to monitor outages? No Mechanisms for restoring service (0-1) 0 Does the distribution utility use automated tools to restore service? No Regulatory monitoring (0-1) 0 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on reliability of supply? No Financial deterrents aimed at limiting outages (0-1) 0 Does the utility either pay compensation to customers or face fines by the regulator (or both) if outages exceed a certain cap? No Communication of tariffs and tariff changes (0-1) 1 Are effective tariffs available online? Yes Link to the website, if available online http://www.edh.ht/tarif.php Are customers notified of a change in tariff 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 tariff 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. Page 20 Doing Business 2020 Haiti 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 five 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 May 2019. See the methodology for more information. What the indicators measure Procedures to legally transfer title on immovable property (number) • Preregistration procedures (for example, checking for liens, notarizing sales agreement, paying property transfer taxes) • Registration procedures in the economy's largest business city. • Postregistration procedures (for example, filling title with municipality) Time required to complete each procedure (calendar days) • Does not include time spent gathering information • Each procedure starts on a separate day - though procedures that can be fully completed online are an exception to this rule • Procedure is considered completed once final document is received • No prior contact with officials Cost required to complete each procedure (% of property value) • Official costs only (such as administrative fees, duties and taxes). • Value Added Tax, Capital Gains Tax and illicit payments are excluded Quality of land administration index (0-30) • Reliability of infrastructure index (0-8) • Transparency of information index (0–6) • Geographic coverage index (0–8) • Land dispute resolution index (0–8) • Equal access to property rights index (-2–0) Case study assumptions To make the data comparable across economies, several assumptions about the parties to the transaction, the property and the procedures are used. The parties (buyer and seller): - Are limited liability companies (or the legal equivalent). - Are located in the periurban (that is, on the outskirts of the city but still within its official limits) area of the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Are 100% domestically and privately owned. - Perform general commercial activities. The property (fully owned by the seller): - Has a value of 50 times income per capita, which equals the sale price. - Is fully owned by the seller. - Has no mortgages attached and has been under the same ownership for the past 10 years. - Is registered in the land registry or cadastre, or both, and is free of title disputes. - Is located in a periurban commercial zone (that is, on the outskirts of the city but still within its official limits), and no rezoning is required. - Consists of land and a building. The land area is 557.4 square meters (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 good condition, has no heating system and complies with all safety standards, building codes and legal requirements. The property, consisting of land and building, will be transferred in its entirety. - Will not be subject to renovations or additional construction following the purchase. - Has no trees, natural water sources, natural reserves or historical monuments of any kind. - Will not be used for special purposes, and no special permits, such as for residential use, industrial plants, waste storage or certain types of agricultural activities, are required. - Has no occupants, and no other party holds a legal interest in it. Page 21 Doing Business 2020 Haiti Registering Property - Haiti Indicator Haiti Latin America & Caribbean OECD high income Best Regulatory Performance Procedures (number) 6 7.4 4.7 1 (5 Economies) Time (days) 319 63.7 23.6 1 (2 Economies) Cost (% of property value) 6.8 5.9 4.2 0.0 (Saudi Arabia) Quality of the land administration index (0-30) 2.5 12.0 23.2 None in 2018/19 Figure – Registering Property in Haiti – Score 58.3 Procedures 0.0 Time 54.8 Cost 8.3 Quality of the land administration index Figure – Registering Property in Haiti and comparator economies – Ranking and Score DB 2020 Registering Property Score 0 100 67.2: Dominican Republic (Rank: 74) 65.3: Jamaica (Rank: 85) 55.7: Guyana (Rank: 128) 54.9: Regional Average (Latin America & Caribbean) 46.3: Puerto Rico (U.S.) (Rank: 161) 30.4: Haiti (Rank: 182) Note: The ranking of economies on the ease of registering property is determined by sorting their scores for registering property. These scores are the simple average of the scores for each of the component indicators. Page 22 Doing B