International Regulatory Reform Initiatives

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International Regulatory Reform Initiatives

• Randa Saryeddine
• Industry Canada

• Presentation for the 2007 Conference in British
  Columbia
• Improving the Regulatory Climate
  in BC
• May 1, 2007

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Presentation Outline

• International Context
• Organization for Economic Co-operation and
  Development (OECD)
• Focus administrative simplifications for business
• Asia-Pacific Economic Co-operation (APEC)
• Private Sector Development Agenda
• APEC-OECD Collaboration
• APEC-OECD Co-operative Initiative
• International Regulatory Cooperation
• Security and Prosperity Partnership

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International Context

• Intense competition and growing involvement in
  global supply chains are changing the bottom line
  for governments and business due to globalization
• SMEs represent major sources of growth and job
  creation, yet are underrepresented in
  international trade
• Many countries recognize the benefits of making
  regulatory management a central element in
  promoting open and competitive markets and a key
  driver of economic efficiency and consumer
  welfare
• Removal of trade barriers and behind-the-border
  improvements (e.g. national regulatory
  management) are becoming common strategies for
  promoting national advantages
• Many have embarked on programmes to improve the
  quality and effectiveness of their regulatory
  regimes. Cutting red-tape has also risen on
  national political agendas
• Market liberalisation, market openness to trade
  and investment and reform of public sector
  institutions are enabling more transparent and
  efficient regulatory regimes

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The OECD and Regulatory Reform

• OECD Regulatory Reform Programme aimed at helping
  governments improve regulatory quality
• Policy support for reforming regulations that
  raise unnecessary obstacles to competition,
  innovation and growth, while ensuring regulations
  serve their intended objectives
• Working Party on Regulatory Reform and
  Management, chaired by Canada, provides support
  for promoting high quality regulations
• Facilitates discussion among policy officials
  responsible for cross-cutting and horizontal
  regulatory reform policies
• Reviews best practices relating to regulatory
  quality and administrative simplification
• Main areas of work on regulatory policy cutting
  red tape, policy principles, regulatory
  performance, regulatory tools, country reports
  and outreach to non-OECD members

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OECD Focus on Administrative Simplification

• Focus on administrative burden reduction for
  business, particularly SMEs, with increasing
  consideration to citizens
• Administrative simplification is one of the
  highest priorities of OECD countries to improve
  governance and regulatory quality
• OECD research shows a correlation between
  restrictive economic regulations and burdensome
  administrative procedures for business
• OECD is undertaking a series of activities to
  assist governments
• Cutting Red Tape National Strategies (2006)
  reports on national strategies or programmes for
  measuring and reducing red tape
• Guiding Principles for Regulatory Quality and
  Performance (2005) which advise on reducing
  administrative costs
• From Red Tape to Smart Tape Administrative
  Simplification in OECD Countries (2003) is based
  on case studies and the use of administrative
  simplification tools
• Business View of Red Tape (2001) provides results
  from a business survey about their costs and
  perceptions of complying with red tape

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OECD Focus on Administrative Simplification

• Strategies for reducing administrative burden
  include
• Quantitative targets to reduce burden
• Codification (i.e., grouping existing regulations
  into a single regulation)
• Coordination across orders of government
• E-government services and electronic and
  web-based platforms
• One-stop shops and process re-engineering
• Risk-based approaches or modified thresholds
• Reductions of licenses and permits
• Communication of results for reducing red tape
• Considerations for future development of
  administrative simplification programmes
• How long will it take to see results of burden
  reduction strategies?
• How will governments evaluate and allocate
  resources between administrative simplification
  and broader regulatory quality objectives?
• How can simplification efforts be extended to
  other orders of government?
• OECD posits that administrative simplification
  will be part of broader targets within overall
  programmes for improving regulatory quality

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OECD Red Tape Scoreboard

• Pilot launched to test and refine a methodology
  for measuring and comparing the administrative
  costs for business across OECD countries
• Pilot conducted on 17 information obligations
  associated with hiring a truck driver and
  operating a truck in the road freight industry
• Standard Cost Model (SCM) consists of four main
  steps
• breaking down legislation into information
  obligations and data requirements
• identifying the activities businesses undertake
  to comply with obligations
• interviewing a normally efficient business on
  time and cost spent on activities
• extrapolating costs using frequency of obligation
  and target population
• 13 member countries participated and data
  belonging to 9 countries are reported
• Canadas cost data excluded due to validity and
  reliability issues
• European countries have formed an SCM Network to
  support use of the model
• RTS has an objective to assess the level of
  burden, identify where countries differ and
  identify best practices on simplification efforts
  used by other countries
• At its last meeting the WP on Regulatory Reform
  and Management recommended that further work be
  undertaken to improve methodological issues with
  the SCM

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APEC and Administrative Simplification

• APEC focuses on three key areas to advance goals
  of free and open trade and investment in
  Asia-Pacific region for developed and developing
  economies
• Trade and Investment Liberalization focuses on
  reducing and eliminating tariff and non-tariff
  barriers to trade
• Business Facilitation focuses on reducing
  business transactions costs, improving access to
  trade information, and aligning policy and
  business strategies
• Economic and Technical Cooperation focuses on
  building capacity at the institutional and
  personal level to assist members in meeting
  economic goals
• APEC SME Working Group
• aims to deepen the understanding of the issues
  facing SMEs and the capacity of the economies to
  contribute to regional economic growth
• facilitate an exchange of views and experience on
  matters relating to SME development in the
  Asia-Pacific region
• Given links between effective regulatory quality
  systems and economic sustainability, APEC is
  focusing on improving the quality of regulations
  through a Private Sector Development Agenda

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APEC Private Sector Development Agenda

• Goals of the Initiative are
• To create an enabling environment for SMEs
• To support their development and competitiveness
• To improve the business environment in the region
• Member economies share regulatory perspectives,
  best practices and policy experiences and discuss
  how to improve their business climates
• Efforts are guided by the World Banks Doing
  Business report on enhancing business
  environments, and uses its indicators to track
  results
• Administrative and regulatory burden is one of
  many areas affecting performance and productivity
  examined by the World Bank
• Thematic symposiums and workshops are held on key
  themes
• First symposium was held on Starting a Business
• Participants discussed practical ways to decrease
  the number of procedures, the number of days, and
  the total cost required to start a business
• Future meetings to focus on Obtaining Licences
  and Access to Capital

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APEC-OECD Co-operative Initiative

• Established as part of an APEC-OECD agreement to
  promote principles for building domestic
  capacities for quality regulation
• Workshops held on regulatory reform programmes,
  trade facilitation, regulatory transparency and
  competition, and sector-specific regulations
• Member economies and relevant individuals and
  institutions have developed an Integrated
  Checklist to self-assess progress in implementing
  common principles of regulatory reform
• Checklist was approved by a Special Group on
  Regulatory Policy (OECD) and endorsed by APEC
  Ministers Responsible for Trade
• 39 questions for national authorities to answer
  when adopting or revising regulatory, competition
  and market openness policies
• builds on values such as transparency,
  accountability and performance
• a tool to strengthen domestic and international
  regulatory cooperation
• APEC Leaders give high priority to the Checklist
  and have requested on-going co-operation with the
  OECD on structural and regulatory reform

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International Regulatory Cooperation (IRC)

• Part of federal effort to ensure an effective and
  efficient regulatory system
• IRC involves bilateral, regional and multilateral
  activities undertaken between governments,
  agencies or organizations with a view to
  improving national regulatory outcomes and
  promoting regulatory compatibility
• IRC includes a wide range of activities or
  practices
• information exchange, collaborative scientific
  work, common data collection, joint risk
  assessments or reviews, and development of common
  standards
• Potential benefits from IRC include
• better informed decision-making from access to
  regulatory resources and data or information
• greater transparency and predictability of
  regulatory practices
• opportunities to promote or influence regulatory
  practices internationally
• improved government efficiency and effective
  resource allocation in the development,
  implementation and enforcement of regulations

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Security and Prosperity Partnership (SPP)

• A trilateral initiative formalized between
  Canada, the United States and Mexico in June
  2005, the SPP aims to promote
• growth and economic opportunity
• increased security
• improved quality of life in North America
• SPP provides a mechanism for developing an agenda
  for North American cooperation and information
  sharing
• SPP is led by the Minister of Industry and the
  Minister of Public Safety
• Interdepartmental working groups support the
  efforts undertaken under the SPP Agenda
• The Security Agenda is addressed by 10 working
  groups and the Prosperity Agenda is pursued by 9
  working groups
• Working groups cover areas as diverse as border
  security, the environment, e-commerce and
  pandemic influenza management

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SPP Focus on Regulatory Cooperation

• Leaders established the North American
  Competitiveness Council (NACC) to provide
  strategic advice on issues affecting North
  American competitiveness
• In February 2007, NACC presented Ministers with
  51 recommendations falling under three key
  themes border crossing facilitation, standards
  and regulatory cooperation, and energy
  integration
• Recommendations on standards and regulatory
  cooperation call for
• completion of a North American Regulatory
  Cooperation Framework
• greater regulatory compatibility in key areas
  food and agriculture financial services
  transportation, and intellectual property rights
• SPP Ministers have requested that the Trilateral
  Regulatory Cooperation Framework be finalized by
  the next Leaders Summit tentatively scheduled
  for August 2007, to be hosted by the PM

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Conclusion

• International regulatory reform initiatives range
  from dissemination of information and exchange of
  best practices to international regulatory
  cooperation efforts and international regulatory
  harmonization
• International recognition of
• Linkages between regulatory quality and economic
  performance
• Effectiveness of reducing administrative burden
  as part of improvements to regulatory regimes
• Importance of integrating private sector input to
  ensure policy advice and actions appropriate
  address business challenges
• Increased use of performance measurement for more
  effective regulatory management
• Many APEC and OECD economies have set targets to
  measure regulatory improvements or have
  integrated regulatory efforts as a key component
  to improving broader productivity and
  competitiveness goals

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For More Information

• OECD Regulatory Management and Reform
  http//www.oecd.org/department/0,2688,en_2649_3414
  1_1_1_1_1_1,00.html
• APEC SME Working Group http//www.apec.org/apec/a
  pec_groups/working_groups/small_and_medium_enterpr
  ises.html
• OECD-APEC Cooperative Initiative
  http//www.oecd.org/document/25/0,2340,en_2649_341
  41_2397017_1_1_1_1,00.html
• Security and Prosperity Partnership of North
  America http//www.spp-psp.gc.ca
• The NACC report, Enhancing Competitiveness in
  Canada, Mexico, and the United States Private
  Sector Priorities for the Security and Prosperity
  Partnership of North America http//www.ceocounci
  l.ca

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