Project Title

Workshop and Technical Assistance on Starting a Business according to International Best Practices 

Project Year

2017   

Project Number

EC 01 2017A 

Project Session

Session 1   

Project Type

Standard 

Project Status

Project in Implementation   
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Project No.

EC 01 2017A 

Project Title

Workshop and Technical Assistance on Starting a Business according to International Best Practices 

Project Status

Project in Implementation 

Publication (if any)

 

Fund Account

APEC Support Fund 

Sub-fund

ASF: Renewed APEC Agenda on Structural Reform (RAASR) 

Project Year

2017 

Project Session

Session 1 

APEC Funding

98,434 

Co-funding Amount

40,322 

Total Project Value

138,756 

Sponsoring Forum

Economic Committee (EC) 

Topics

Structural Reform 

Committee

Economic Committee (EC) 

Other Fora Involved

 

Other Non-APEC Stakeholders Involved

 

Proposing Economy(ies)

United States 

Co-Sponsoring Economies

Hong Kong, China; Indonesia; Mexico; New Zealand; Viet Nam 

Expected Start Date

01/05/2017 

Expected Completion Date

30/06/2018 

Project Proponent Name 1

Mark Walter 

Job Title 1

Deputy Chief of Party 

Organization 1

US-ATAARI 

Postal Address 1

c/o APEC Secretariat 

Telephone 1

35 Heng Mui Keng Terrace, Singapore 119616 

Fax 1

Not Applicable 

Email 1

mwalter@nathaninc.com 

Project Proponent Name 2

Mike Dennis / Nick Klissas 

Job Title 2

Attorney-Adviser / APEC Coordinator 

Organization 2

US Department of State / USAID 

Postal Address 2

Not Applicable 

Telephone 2

Not Applicable 

Fax 2

Not Applicable 

Email 2

nklissas@usaid.gov 

Declaration

Mark Walter, Mike Dennis and Nick Klissas 

Project Summary

This project will organize a one-day workshop on Starting a Business (SAB) according to International Best Practices, with special focus on MSMEs, on the margins of EC2-2017. As follow up to the workshop, this project will additionally implement 1-2 economy level capacity building activities for volunteer developing economies to support SAB reforms, in particular those in line with recommendations from the study, as part of the implementation of their RAASR IAPs.

The workshop aims to help member economies make further improvements in their business environments through better understanding of best practices developed by international bodies regarding simplified business registration and incorporation, including UNCITRAL, the World Bank, and UNCTAD, among others. The workshop will integrate the results from the study “Assessing APEC Starting a Business according to International Best Practices,” currently under way and to be completed and distributed for member economy input before EC2. The workshop’s focus will build on relevant Doing Business indicators for SAB, and also include deeper and more comprehensive analyses of SAB frameworks across the region.

Relevance

This project aims to assist APEC member economies make further improvements to their economic and legal infrastructure for doing business; in particular on the EoDB topic of Starting a Business (SAB). It focuses on promoting reforms that would help to reduce regulatory barriers faced by all businesses, but in particular by micro, small and medium-sized enterprises (MSMEs). 

As the World Bank has found, cumbersome, unclear or unpredictable or costly incorporation and registration requirements are often a key factors causing informality[1]. Moreover, UNCITRAL has found that “traditional” business models — including incorporated companies and partnerships —present barriers, or may not be suitable for the creation and growth of MSMEs.  Such models are often not “fit for purpose” for micro and small businesses as their establishment: (a) is too costly (both in terms of money and time); (b) results in over-regulation; and (c) exposes entrepreneurs with risks of liability.  For that reason, the World Bank, UNCITRAL, UNCTAD and others have developed principles of simplified business registration and incorporation.  Simplified business registration and incorporation is a key means for MSMEs to formalize, and participate effectively in the local and global economy. More generally, business registration reforms based on international best practices can foster private sector growth, greater job creation opportunities, increased productivity and therefore higher economic growth. 

By promoting modern business registration and incorporation systems in APEC, this project will help create an enabling legal environment for businesses to enter the formal economy, in particular in developing economies in the region. Moving informal MSMEs into the formal economy can have considerable benefits for both the business (e.g., better access to credit and government services) and the overall economy (e.g., payment of taxes, compliance with labor laws).  As a result, this project will promote faster growth, greater entrepreneurship and productivity, create jobs, boost legal certainty, and attract larger inflows of foreign direct investment to the APEC region. 

This project directly links to Rank 1 in 2017 APEC Funding Criteria (projects with a direct link to promoting regional economic integration) given that it contributes to improving the Ease of Doing Business (EODB), implementing the Renewed APEC Agenda for Structural Reform (RAASR), and promoting the competitiveness of MSMEs.


[1]http://www.doingbusiness.org/data/exploretopics/starting-a-business/why-matters

Objectives

The workshop aims to assist APEC member economies in making further improvements to their business environments, particularly in the area of Starting a Business. The specific objectives of the workshop include:

·  Improving understanding of international best practices for simplified business registration and incorporation, particularly those embodied in the work of the World Bank, UNCITRAL, UNCTAD among others.

·  Discussing the results of the study: “Assessing APEC Starting a Business according to International Best Practices”,[1] which analyses the degree of alignment of APEC economies’ frameworks to international best practices on simplified business registration and incorporation and identifies areas for improvement in the APEC region. In particular, the Study considers the following features as best practices:

•  the possibility of one or more persons incorporating;
•  full-fledged limited liability;
•  contractual flexibility;
•  flexible organizational structure;
•  optional minimum capital;
•  general objectives clause;
•  fiscal transparency and simplified accounting;
•  simple registration and incorporation requirements;
•  optional use of intermediaries; and
•  flexible means of enforcing shareholder agreements 

The capacity building activities for volunteer developing APEC economies will aim to provide targeted assistance to support the implementation of SAB reforms in line with international best practices, as part of the implementation of their RAASR Individual Action Plans.


[1] This study is being implemented by the United States through a self-funded project (EC 06-2016S).

Alignment

The proposed workshop and follow on capacity building will directly contribute to the APEC EoDB Initiative. In 2015, APEC Leaders recognized the progress made on the EoDB initiative and welcomed the second EoDB Action Plan for 2016-2018 with a new target of 10% improvement in the existing 5 priority areas by 2018. This workshop is one of the capacity building activities included in the EoDB Implementation Plan (2016-2018) in the area of SAB. 

In addition, the project contributes to APEC’s Structural Reform agenda. It responds to the Structural Reform Ministerial Meeting Statement (2015) and the 2014 Leaders’ Statement, which encouraged a wider use of international legal instruments to create a more conducive climate for cross-border trade and investment, and therefore contribute to APEC’s regional integration, connectivity, and structural reform agenda. 

Moreover, the project, and in particular the technical assistance for volunteer economies, will support the implementation of RAASR Individual Action Plans (IAPs) where a number of developing economies identified areas for improvement for Ease of Doing Business in general (Chile), and in particular SAB (Indonesia, Viet Nam). 

Finally, this project will contribute to work of the EC FoTC on Strengthening Economic and Legal Infrastructure (SELI) in the sense that it raises awareness of the importance of improving the legal infrastructure in the region, and promotes the use of international standards and instruments such as those developed by UNCITRAL, World Bank, UNCTAD, etc.

TILF/ASF Justification

This project intends to build capacity of APEC economies to undertake regulatory reforms to help make it easier, cheaper and faster to establish and operate a business, in particular for MSMEs. As mentioned above, this topic is particularly important for developing economies, where a majority of businesses are MSMEs, many of which still operate in the informal sector, so business registration reforms may have a greater impact in terms of providing better business opportunities for MSMEs, and  promoting  inclusive growth. 

This project will strengthen the ability of developing member economies to implement meaningful reforms, through promoting a greater understanding by relevant government agencies of the international best practices for business incorporation and registration reforms. In addition, the proposed workshop will provide economies with the opportunity to discuss the results and recommendations from the study “Assessing APEC Starting a Business according to International Best Practices,” currently under way, which aims to assess the degree of alignment of the each APEC economy’s starting a business frameworks to those best practices, and to identify areas for reform.  The project will provide funding for travel-eligible economies to participate in this workshop, so Project Overseers (POs) will actively engage to promote the participation of relevant experts. 

Finally, this project is proposing to provide technical assistance to support one-two volunteer developing economies in implementing reforms in line with these best practices. This technical assistance will be tailored to the specific needs and context of the volunteer economies to help them achieve their policy objectives under their RAASR IAPs. The experience and lessons from this technical assistance will then be shared among all member economies, so that APEC as a whole can benefit.

Beneficiaries and Outputs

Outputs: The project will consist of the implementation of a one-day workshop which will be held on the margins of EC2-2017, in August in Ho Chi Minh City, Viet Nam. 

This workshop will invite relevant policymakers and government officials responsible for the design and implementation of key EoDB reforms, in particular for business registration and incorporation. The workshop will also invite key experts from relevant institutions such as UNCITRAL, UNCTAD, and the World Bank. The workshop will begin by providing an overview of the importance of making further efforts in improving frameworks for starting a business, in particular to facilitate MSME development and growth.                                                                     

The workshop will then describe relevant international best practices collected by international organizations such as World Bank, UNCITRAL, UNCTAD, among others; and discuss the findings of the study “Assessing APEC Starting a Business Frameworks according to International Best Practices” to identify areas for possible improvements among APEC member economies, the relevant best practices that can be applied as well as possible capacity building activities that can support economies to implement them. The workshop will combine presentations from relevant experts from international organizations, economies and may include representatives from the private sector. 

In addition to the workshop, the project includes the implementation of technical assistance to one-two volunteer economies interested in pursuing reforms to improve their starting a business frameworks attendant to their RAASR IAPs. This technical assistance will be in the form of an expert who will work with the interested economy in the implementation of reforms to their starting a business frameworks in line with international best practices. These activities will be tailored to the specific needs of the volunteer economies, so the POs will coordinate with the volunteer economies as well as with the EoDB Champion Economies for SAB to design the program. 

Outcomes: The goal of this project is to create an enabling legal environment conducive to efficiently establish businesses, and in particular to help make it easier for MSMEs to enter the formal economy. By facilitating simplified business and incorporation best practices, this project will contribute to develop and strengthen MSMEs through better access to credit and other government services as well as improving their ability to access international markets.  As a result, this project will promote faster growth, greater investment, entrepreneurship and productivity, and job creation in the APEC region. 

Beneficiaries: Immediate beneficiaries of this project will be the participants who attend the workshop and their organizations, as well as volunteer developing economies who participate in the targeted capacity building activities. In order to maximize the benefits of this project, POs will work to bring relevant experts/officials from economies to participate who could benefit from the training as well as actively engage and contribute to the discussions. For example, invitations for the workshop will suggest economies to consider nominating relevant government officials responsible for the design and implementation starting a business reforms, in particular, officials or experts who are involved in the development of legal frameworks on business incorporation as well as those involved in the development and operation of business registration frameworks and systems. These participants will gain knowledge of international best practices for business registration and incorporation, and increase their capacity to design and implement reforms to improve their domestic frameworks. 

Long-term beneficiaries will be the firms and entrepreneurs in APEC economies, in particular from developing economies, who will be able to increase their economic participation and reduce business risks through simplified registration and incorporation.

Dissemination

The workshop materials including agendas and presentations will be distributed to the participants electronically and will be made available through the APEC website (Meeting Document Database). There is no intention to produce any publication as a result from this activity. 

The POs will report the outcomes of the workshop at the EC2 Plenary Meeting in Ho Chi Minh City.

In addition, the POs will report on the outcomes of the economy level technical assistance activities by EC2-2018.

Gender

POs will work to ensure that both female and male speakers and participants have equal opportunities to attend and actively participate in the workshop. POs will try to identify relevant speakers early in advance as well as to send the invitations to economies with enough time for them to consider the most suitable participants. 

In terms of direct beneficiaries, the project is expected to benefit and build capacity of both male and female government officials from APEC member economies. 

If we consider MSMEs as one of the most important long term beneficiaries of this project and that women led businesses are more likely to be in smaller and operate in the informal sector, by promoting reforms that would make it easier for MSMEs to register a business, this project may be particularly useful to promote women’s economic participation. Increased formalization of their businesses will provide them greater business opportunities as well as better access to finance, public services, etc.

Work Plan

The project will implement a one day workshop that will build on and integrate the results from the study “Assessing APEC Starting a Business according to International Best Practices”, which analyses the degree of alignment of APEC economies to international best practices in simplified incorporation, identifies areas for improvement and provides reform recommendations.  The workshop would take place on the margins of SOM3 (August 2017). Following the workshop, the POs will work with 1-2 volunteer economies to implement targeted technical assistance activities that contribute to advancing their RAASR IAPs. 

Below are some of the key actions for this project: 

-  May 2017 – POs to monitor the progress of the study on “Assessing APEC Starting a Business according to International Best Practices” to identify areas where further capacity building is needed in APEC to help inform the design of the workshop and follow on technical assistance. 

-  June 2017 – POs will work to develop the draft the agenda for the workshop, identify relevant experts and speakers, and send speaker invitations. 

-  July 2017– Circulate the invitation and nomination forms for the workshop to APEC economies through the Economic Committee. 

-  August 2017– Implement a one-day workshop on the margins of SOM3. Report back on the outcomes of the workshop at the EC Plenary. POs will work to identify volunteer economies interested in participating in the follow on technical assistance. 

-  September 2017 - June 2018 – POs to work closely with volunteer economies to design and implement the economy level capacity building on EODB SAB reforms for volunteer developing economies. 

August 2018 – Report on the outcomes of the project to the EC and send completion report to APEC Secretariat.

Risks

In the case of the workshop, the risks may be related to getting good quality speakers as well as relevant participants from all member economies. POs plan to manage this risk by carefully designing the agenda of the workshop and identifying relevant experts in advance. In addition, POs will circulate the invitation to economies as early as possible and provide information of the desired profile of participants to guide economies in the nomination process. 

Another risk for the workshop is with regards to possible delays in the development and collection of workshop materials and inputs, including presentations from speakers and also the study on “Starting a Business according to International Best Practices,” which is currently underway and will be discussed during the event. For this issue, POs will work closely with speakers to ensure timely submission of their presentations and will monitor the progress in the study to ensure that the necessary information and analysis is available by the time of the event. 

In the case of the economy-level technical assistance for volunteer economies, one of the main risks is the lack of interest by developing member economies to participate. To mitigate this risk, POs will engage in outreach efforts to potential participating economies and follow up regularly with economies that have expressed interest. 

In addition, there might be challenges in finding appropriate experts to undertake this technical assistance. To manage this risk, POs will promote coordination between Champion Economies in the area of Starting a Business as well as consult relevant international organizations to identify possible experts.

Monitoring and Evaluation

POs will regularly monitor the progress of the activities under this project. 

POs will develop participant evaluation forms to collect participants’ feedback for this capacity building workshop. The evaluations will allow participants to assess the quality of the workshop, on the substantive program as well as on the organization and logistics. The evaluations will also try to measure the level of knowledge gained by participants on key issues or topics covered during the workshop. Data disaggregated by gender will be collated to ensure that impacts on women are measured and monitored – this will include the number of participants as well as the number of technical experts engaged as speakers and experts. This information will be reported through the APEC process – via APEC Monitoring and Completion reports. 

If possible, POs will perform a follow-up survey to participants, to see if economies use the lessons from the workshop to implement reforms.

Linkages

In addition to the directly linkage to the Economic Committee RAASR and EoDB agenda, this project has implications for other areas of work in APEC including women’s entrepreneurship, MSME development, among others. In order to promote collaboration with other relevant APEC fora such as SMEWG and PPWE, POs will share information about the study, workshop and its outcome. The workshop will also engage non-APEC stakeholders. Experts from relevant international organizations, such as UNCITRAL, World Bank, UNCTAD, etc. will be invited to discuss the best practices and experiences. The POs will work closely with EoDB Champion Economies for SAB, and will discuss with other relevant EoDB Champion Economies to ensure that linkages are identified. 

The workshop and technical assistance proposed in this project will build on the Study “Assessing APEC Starting a Business according to International Best Practices” self-funded project currently implemented by the United States (EC 01 2016S). It will also build on previous EoDB workshops implemented in APEC. The EC has been working on building capacity of economies to improve their business environments through the EoDB initiative, which started in 2009. Since then, there has been several capacity building projects related to starting a business as well as workshops covering all the 5 EoDB priority areas, where economies shared their experiences and also discussed international best practices. The proposed workshop and technical assistance will build on these past activities such as the EoDB Stocktake Workshop of 2014, the 2015 EoDB Workshop, and the workshop on “One-stop Shops to Improve the Business Environment”, which took place on the margins of SOM1-2016 and which included discussions and examples of the use of single windows to improve starting a business processes.

Sustainability

This project is part of the APEC EoDB Initiative and is one of the activities included in the EoDB Implementation Plan 2016-2018. In this sense, there is great support from member economies to continue undertaking further reforms to improve the business environment, in particular to achieve goal of 10% improvement by 2018. 

The workshop will build capacity of member economies to undertake domestic reforms to improve their business registration and incorporation frameworks, and will identify relevant international best practices that economies can consider as a reference. Moreover, in order to support volunteer developing economies who are interested in carrying forward reforms in line with these best practices, the project includes technical assistance that will follow the general workshop. This approach is aimed at trying to ensure that the lessons and outcomes from the workshop and the study on Starting a Business are put into practice. 

Moreover, the fact that the technical assistance will correspond to priorities that volunteer economies include as part of their RAASR IAPs, provides greater assurance of their relevance and possible impact and also shows the interest of the volunteer economy to pursue unilateral reforms in this area.

Project Overseers

Mr. Mark Walter is US-ATAARI’s Deputy Chief of Party and Technical Director of the Singapore Office. He is a lawyer specializing in the international business enabling environment, Commercial Dispute Resolution, Trade Policy reform and assessment, and drafting and implementation of commercial law. Prior to joining the US-ATAARI Project, Mark was Managing Director for Nathan Associates’ Trade Policy and Legal and Regulatory Practice. Mr. Walter was Chief of Party on the USAID-funded Doha Project for WTO Accession in Ethiopia, and on its redesigned successor project, the Ethiopia WTO Accession Plus Program. He has also served as Assistant Director for the Center for International Legal Education at the University of Pittsburgh, Adjunct Professor of Law, and as an international legal consultant. He has worked with trade law reform, lectured, and developed commercial law and legal education reform programs in regions across Africa, Eastern Europe and Asia, including Ethiopia, Mongolia, Egypt, Thailand, Indonesia, Ukraine, Serbia, Kosovo, Macedonia, Uzbekistan, and China. 

Mr. Mike Dennis is an attorney with the Office of Legal Adviser, U.S. Department of State and the U.S. Representative to the APEC Economic Committee FoTC on Strengthening the Economic and Legal Infrastructure. He is the Executive Director of the Department of State Advisory Committee on Private International Law. He has represented the United States in international fora on public and private international law matters. Most recently, he has served as Representative of the United States at the United Nations Commission on International Trade Law (UNCITRAL) annual sessions and in the working groups on online dispute resolution, secured transaction reform, and on creating an enabling legal environment for micro, small and medium sized enterprises. Additionally, he has served as the Representative of the United States at Hague Conference on Private International Law meetings. He also works with the Department’s Financial Inclusion Working Group, assisting in implementing legal reforms in the Americas and APEC region. 

Mr. Nick Klissas is APEC & Legal Reform Coordinator in the Office of Trade and Regulatory Reform in USAID's Bureau for Economic Growth, Education, and Environment.  He works closely with USAID missions, other government agencies, international organizations, and private sector counterparts to develop and manage trade capacity building, structural reform, and commercial law reform projects.  A lawyer, Mr. Klissas has over two decades of federal government experience, including the Soviet & European Affairs Directorate of the National Security Council (1985-87), the Democracy and Human Rights Bureau of the State Department (1992-95), and the Commercial Law Development Program of the Commerce Department (1995-97).  Between 1989 and 1992, Mr. Klissas also worked with Brown & Wood, a Wall Street law firm, where he specialized in municipal finance.  Mr. Klissas has a BSFS degree from Georgetown University, an MIA from Columbia University, and a JD from the University of Virginia.

Cost Efficiency

Not Applicable.

Drawdown Timetable

Not Applicable.

Direct Labour

The project proposes to implement one-two technical assistance activities that will provide assistance to volunteer economies. In this case, Direct Labour includes the expert consultants that will be in charge of undertaking this technical assistance activities. 

Considering that these activities are going to be tailored to the specific needs of the volunteer economy, at this point it is not possible to specify the total number of hours/days that would be required and the specific tasks that would be performed by them. The POs will work closely with the volunteer economies to design the technical assistance activity in the most efficient and productive way and will keep in communication with the APEC Program Director and Program Executive regarding the details of this activities.

Waivers

Not Applicable.

Are there any supporting document attached?

No 
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Total Project Value

Sponsoring Forum

Topics

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Expected Start Date

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Project Proponent Name 1

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Organization 1

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Declaration

Project Summary

Relevance

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TILF/ASF Justification

Beneficiaries and Outputs

Dissemination

Gender

Work Plan

Risks

Monitoring and Evaluation

Linkages

Sustainability

Project Overseers

Cost Efficiency

Drawdown Timetable

Direct Labour

Waivers

Are there any supporting document attached?

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