It’s more difficult to register a small business than a limited company: Report

business

Mar 06, 2020 (LBO) – Advocata Institute launching its report on regulations to small business and red tape project called for the removing of legal and regulatory barriers faced by small and micro entrepreneurs.

The report looks in on the main barriers for the establishment and operation of these enterprises.

“We see the regulatory processes, access to finance, finding places and space within them and skilled labour among the main barriers,” Sarath Rajapatirana, chair Academic Programme, Advocata Institute said.

“Following the 13th Amendment to the Constitution, there are at least nine different regulatory requirements within a province and different processes among different zones in the same province.”

The objective of the Red Tape Project is to identify, study, and advocate for the removal of legal and regulatory barriers faced by businesses in Sri Lanka.

Advocata also launched www.redtape.lk, a website for entrepreneurs to submit their frustrations or views on red tape and government processes and regulations that need to be removed or simplified.

Rajapatirana says the comparison of Sri Lanka’s practices with those of Hong Kong and New Zealand, two countries that have higher rankings for economic freedom in the world and also have best practices for registration of enterprises is used to guide the reform recommendations.

Sri Lanka can also follow similar practices, he says like providing better access (with trilingual forms), avoiding excessive documentation, adopting a single approval process and providing an online portal for registration.

“These are achievable goals to create room for success that these enterprises deserve.”

The launch event also hosted a panel discussion with Dr S. Rajapatirana (Chair, Academic Programme, Advocata Institute), Milinda Rajapaksha (Councillor, Colombo Municipal Council)  and Achala Samaradiwakara (Co-Founder and Managing Director, Good Market). The panel was moderated by Dhananath Fernando (COO, Advocata Institute).

The number of SMEs in Sri Lanka, most of which are categorised as sole ownerships, accounts for 1,019,681 of which 71,126 are small enterprises and 10,405 are medium scale enterprises. These enterprises comprised of employees, self-employed persons, employers, active partners and unpaid family workers who engage in economic activity.