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City Hall Adopts e-License for Single Business Permit

Published by the East African Standard, 14/03/2011, by Patrick Githinji

Plans are underway for traders within the City Council of Nairobi (CCN) to apply and pay for a single business permit through an electronic system. City Council Chief Licensing Officer John Gitau told Financial Journal the system would reduce long queues and that within a day or two applicants will be issued with trading licences. "It will be easier for our customers to pay through electronic systems such as m-banking and apply for the licence electronically, " Gitau said. The project is being undertaken through the CCN initiative of reforms in order to attract more investors. The new system is expected to be in place by June this year. 

Line ministries

Although he didn't disclose how much they are investing in the system, he pointed out that part of funding would come from the International Finance Corporation - a World Bank subsidiary. Under the new system, investors could acquire council licences through line ministries. The 2009 Finance Bill introduced important changes to the Local Government Act (CAP 265), allowing local authorities to reform business licensing systems. A large number of stakeholders have been lobbying the Government to reduce the number of business licences as they were unfavourable to investments. CCN has been hesitant on the issue because it depends on several licences as one of its major sources of revenue. When completed the council estimates to collect over Sh15 billion in license revenue. "You can apply for a business licence in the morning and collect it the same day. In case there are delays one is issued with a payment receipt which is to be used within three days before a permit is received. After the three days elapse, it is a punishable crime by the law to use the receipt of payment as proof of waiting for the license,'' said CCN Licensing Committee Chairman Jaffer A.W. Kassam.

Increased returns

Since the reforms were introduced in the licensing department, the council has recorded a momentous increase in returns. In 2008, Sh673 million was collected from licensing, which rose up to Sh827 million in 2009. According to the World Bank's 2011 Doing Business report, much remains to be done by countries in East Africa in the improvement of investment climate. However, the report noted that Kenya eased business start-up licence by reducing the time it takes to get the memorandum and articles of association stamped, merging the tax and value added tax registration procedures, and digitising records at the registrar. The report added that, the country sped up trade by implementing an electronic cargo tracking system and linking that system to the Kenya Revenue Authority's electronic data interchange system for customs. The Breton Woods institution ranked Kenya 98 among 183 countries sampled.

Author: admin, Posted On: March 16, 2011

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