New measures to improve the business climate in Benin have been taken. These relate to business creation (A), licensing (B), cross-border trade (C), enforcement of contracts (D), access to credit (E), and protection of investors (F).
A) BUSINESS CREATION : The simplification of the process of creating a business through a reduction in time and costs.
The Government has simplified the process of creating a business by adopting the following texts:
- Decree No. 2014-220 of March 26th, 2014, which details the rules for the creation of Limited Liability Companies (LLC) in the Republic of Benin;
- Decree No. 2014-194 of March 13th, 2014, which modifies decree No. 2009-542 of October 20th, 2009, detailing the creation, attributions, and functioning of the One stop shop for companies (called “GUFE”).
- The interministerial degree regulating the formalities related to the declaration of the undertaking of business creation, to the modifications of businesses, and to the exercise of all entrepreneurial activities in the Republic of Benin; and
- Note 318-c of May 15th, 2013 of the General Directorate of the Taxes and Domains on the obtaining and validating of the Fiscal Identification Number (FIN).
These texts allowed for:
- Cost reductions: on one hand, the costs of setting up of companies, more specifically of LLC’s, have gone from 500,000 FCFA in 2012, to 225,000 FCFA in 2013, to 57,000 FCFA in 2014, as a result of several reforms. On the other hand, the minimum social capital of 1,000,000 FCFA has been removed and is now freely determined by the shareholders in the articles.
- Time reductions: the total time for setting up a company in Benin has been reduced by 15 days in 2013 to 8 business days today.
- Reductions in the number of procedures: the procedures have gone from four (4) to two (2), and are now limited to capital deposits in banks and to the formalization of the company to the GUFE. The mandatory use of notaries in the creation of an LLC has been revoked.
- The suppression of the demand for banking information before the issuance of the FIN: this is the result of the dematerialization of the procedure of verification of the social denomination through the establishment of a remotely-accessible database of companies for all promoters before choosing the company's name.
- Furthermore, the Government of Benin launched of the official GUFE website (www.gufebenin.org), on February 18th, 2014, in view of ensuring, among other things, the online publication of excerpts from the Trade and Personal Property Credit Register (RCCM), resulting in the suppression of the costs of the publication and the continuity of the service. It is important to note that the free online publication of the excerpts of the RCCM is an initiative that has been taken by the Republic of Benin since April 2013 and was formalized in 2014.
B) GRANTING OF CONSTRUCTION PERMITS
Several texts regarding building permits have been adopted: decree No. 2014-205 of March 13th, 2014 which established regulations for the issuing of building permits in the Republic of Benin, is supplemented by six (06) interministerial and ministerial decrees and various notes of service in view of expediting the processing of cases at the mayor’s office in Cotonou.
All of these measures have resulted in:
- Reduction in time:
- the time required to issue building permits has been reduced to 30 days; and
- the time required to deliver a certificate of conformity and habitability has gone from 45 days to 25 days.
- The simplification of procedures through the launching of the One Stop Shop of the issuing of building permits with the Mayor’s office in Cotonou. With this rationalization, the payment of fees for coursework related to requests for building permits will be done in the same office where the requests were deposited and will be headed by a commissioner appointed by the Minister of Finance.
C) CROSS-BORDER TRADE
Several texts have been adopted, and they have led to:
- the ceasing of the use of paper support for the “Bordereau de frais unique” (BFU): Memo No.0899 and circular No.0898 of March 19th, 2014, adopted by The General Directorate for Customs and Indirect Taxation, invite all concerned administrations to cease using paper for the BFU in view of using only the BFU numbers and the customs declaration.
- The dematerialization of the control of information on the Cargo Tracking Note (CTN): Memo No.1047 and circular No.1046 of April 2nd, 2014 were also taken by the General Directorate for Customs and Indirect Taxation to dematerialize the monitoring of the information contained in the CTN. This memo allows for inspectors and customs agents to consult the information directly in the system of The Benin National Shippers’ Council (CNCB), without having to request a paper version of the document;
- Recall on the non-requirement of a phytosanitary certificate for ordinary products: Memo No.038 of February 14th, 2014 by the Ministry of Agriculture, Livestock and Fisheries serves as a reminder that phytosanitary certificates are no longer required for non-food products and for products that do not have animal or fish origins.
- Regulation of roadside traffic stops on the corridors of Benin: the Government of Benin took memo No.2013-546 of December 24th, 2013 regarding the regulations of roadside traffic stop stations on the corridors in the Republic of Benin, which limits the duration of traffic stops to five (5) minutes per vehicle and also limits the number of stations in the following areas:
- Axe Cotonou – Malanville : three (3) stations ;
- Axe Cotonou – Porga : three (3) stations ;
- Axe Cotonou – Hillacondji : one (1) station ;
- Axe Cotonou – Kraké : one (1) station ;
- Axe Cotonou – Igolo : one (1) station.
D) EXECUTION OF CONTRACTS: Reorganization of the commercial section of the Second Chamber of the Court of First Instance of Cotonou
In anticipation of the creation of the Commercial Court, an order was adopted by the President of the Second Chamber of the Court of First Instance of Cotonou to reorganize its commercial section.
The members of the commercial section vow to apply the provisions of the Code of civil, commercial, social, administrative and accounting procedures in order to resolve commercial affairs.
E) ACCESS TO CREDIT
Ministerial Order No.52 of May 24th, 2013 enabled the facilitation of access to credit by the Register of Commerce and Credit (RCCM) of Cotonou for all operations relating to securities and leasing contracts.
An end was put on the old procedure consisting of transmitting all information relating to the registration of securities and lease contracts from other jurisdictions to the Registry of the Second Chamber of the Court of First Instance of Cotonou.
The next step to accelerate and streamline this centralization is to inform all of the RCCM’s of the country in order to interconnect them all.
F) PROTECTION OF INVESTORS
Benin’s adoption of the Revised Uniform Act relating to Commercial Companies and Economic Interest Groups on January 30th, 2014 in Ouagadougou permitted it to improve investor protection, notably through the reinforcing of the rights of minority shareholders, the increasing of responsibilities placed upon directors, and the improving of access to information about the company and its operations to shareholders.