Business Environment Improving - Administrative Burden Reduced by €33 Million in Three Years
Continuous improvement of the business environment and reduction of the administrative burden are making Lithuania one of the most attractive places to do business in the region. In three years, the administrative burden on businesses has been reduced by more than €33 million.
"Strong companies are the engine of the economy. We are working to create the conditions for them to grow by reducing regulatory burdens and fostering constructive dialogue and cooperation between regulators and business representatives and their associations. As various global rankings show, the conditions created in Lithuania for business development are highly appreciated. Today, we rank first among OECD member countries in terms of product market regulation. We can see the results - our economy is getting stronger, the start-up ecosystem is growing, and new investors are coming to the country," said Aušrinė Armonaitė, Minister of the Economy and Innovation.
Reducing the regulatory burden is one of the priorities of the Ministry of Economy and Innovation (EIMIN). Consistent work is yielding results - since 2021, all institutions together have reduced the administrative burden by more than EUR 33 million. In the first half of 2024, the overall regulatory burden, both in terms of administrative burden and adjustment costs, was reduced by €1.9 million.
EIMIN regularly reviews the regulatory framework relevant to business - in recent years it has assessed more than a thousand draft laws and made proposals to improve the business environment. It also makes recommendations to the authorities to avoid excessive regulatory burdens and to remove existing barriers.
"Reducing the regulatory burden and ensuring the effective functioning of supervisors is a matter of competitiveness for our country. Every year we assess the performance of the supervisory authorities and make recommendations on how to improve processes. We suggest that authorities systematically review existing legislation and regularly consult with entrepreneurs and their representative associations. We also encourage investment in digital tools and platforms to optimize operations," says Ieva Valeškaitė, Vice-Minister of the Economy and Innovation.
The Ministry is also sharing knowledge and continuously developing the skills of government employees in the areas of reducing the regulatory burden and smart business supervision. 2,700 legislators have been trained in the principles of regulatory burden assessment and reduction. More than 3,500 supervisors have been trained in the principles of smart supervision.
In recent years, 35 supervisors have made more than 100 improvements in their supervisory activities. In order to improve the performance of business supervisors, the Ministry has also drafted and submitted to the Seimas draft amendments to the Law on Standardization of Supervisory Processes and Reduction of Excessive Inspection Burden. For example, the authorities will be required to apply business risk assessment in their supervisory activities, so that less risky companies will be inspected less frequently than the riskiest companies.
The proposed changes will also improve the licensing process. It will clearly define the conditions for licensing and ensure that the requirements imposed on firms are targeted and proportionate. The licensing process will be digitized and licensing data will be stored in a single Licensing Information System (LIS), where all necessary information on the requirements for the activity to be carried out can be found and all necessary licenses can be ordered.
The improving business environment is also reflected in global rankings, where Lithuania consistently ranks high. This year, Lithuania was ranked in the top four in the Global Entrepreneurship Monitor (GEM), and the Organization for Economic Cooperation and Development (OECD) ranked Lithuania first in this year's Product Market Regulation Index. Among OECD member countries, Lithuania scored highest in terms of licenses and permits (1st place), administrative and regulatory burden (5th place), and ease and speed of starting a business (5th place).
Last updated: 18-10-2024
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