Streamlining biz license process goal of new law says DOC
One of the key components of the major overhaul of the local statute dealing with business licenses and fees by the Commerce Department addresses the lengthy review process to get a license.
The long review process is one of the long standing concerns from Chamber leaders and membership, and the DOC agrees, saying that the “current process is confusing and convoluted” with current statutes placing the process with Treasury, yet the actual process has been handled by DOC since the early 1980’s.
“An application must be reviewed by three departments and a commission,” said DOC of the current process. “As with all matters in the government, every department a document must go through creates additional delays,” said DOC in the executive summary. “The new process consolidates everything into the DOC. One department with the power to make a decision will greatly expedite this process.”
“For special cases, and cases of appeal, the application may go to the Territorial Planning Commission, but the vast majority of cases will speed through the process,” it says,
DOC already handles the licenses from start to finish, and this is more a formal recognition of its role than anything else. It also eliminates the need for every business to go before numerous departments simply to start operating a business.
“By bringing licensing under one department, the new system will also avoid conflicting information. For example, DOC uses one system of numbering to process the paperwork, but Treasury uses a different system for the licenses, and neither department shares those numbers with the other,” the executive summary states.
“The result is that DOC can’t search by license number, and Treasury can’t search by application number. One number for one business will greatly streamline the process,” it says. “Part of the integration of the process within DOC also includes the need for new regulations. DOC will be in charge of compiling regulations, which will address issues such as fees, renewals, applications, classifications, etc.”
Not mentioned in the ‘one stop’ revamp by the DOC is the requirement for business licenses for companies that do not have local partners to be signed off by the governor of American Samoa.
DOC says that based on recommendations from the Chamber of Commerce, a provisional license was introduced.
The provisional license would allow a business to operate for no more than 60 days based on a preliminary review by DOC, pending the final license. “This will not only allow a business to operate sooner, but will avoid certain paradoxes in the current system,” said DOC, adding that a provisional license will allow a business to operate to the extent allowable by law, before the endorsements are granted by the many agencies required to sign off on the application.
Not every business is going to violate the law, yet under the current system, every potential business is investigated as if it were a criminal, said DOC.
“While this onerous process may stop some bad businesses from starting, it also stops many good businesses from doing the same. On the flip side, bad businesses cannot be reviewed after they have received their license,” it says. “The basis for revocation under the current law is so slim, that we have now a system where businesses are continuously violating the law with practical impunity.”
“The new system will rearrange this. Initial review for businesses will be more lax, allowing more businesses to start. However, the powers to investigate and, if necessary, revoke or suspend an issued license are increased,” the agency said. “This balance will create a system where only those businesses violating the law will undergo the severe scrutiny that is now imposed on everyone. It will also give the government the power to stop a business that refuses to obey the law.”
DOC points out that the judicial branch has complained for decades that some businesses keep coming before them, yet are still allowed to conduct their trade and this new system will give the government the power to do something about that.
“However, there is the concern, which exists now, that other agencies are using business licenses to enforce their regulations, instead of actually using their own enforcement powers,” it says. “It needs to be clear that revocation of business licenses should only be used in conjunction with agency enforcement, not in lieu of it.
“The new business licensing system will greatly improve the licensing process for new businesses. By giving the power to one department, unnecessary delays will be avoided,” said DOC. “This should be seen as the first step towards a more comprehensive business promotion strategy.”
Samoa News will report later on other issues dealing with the business licenses.