Financial Crime World

Timor-Leste: Dealing with Construction Permits, a Daunting Task

For businesses looking to set up shop in Timor-Leste, navigating the construction permit process can be a daunting and time-consuming task. According to the latest Doing Business report by the World Bank Group, it takes an average of 88 days and no charge to obtain a building permit in Timor-Leste.

The Challenges

The process involves 13 procedures, including requests for “no objection” letters from the Directorate of Land and Property, project clearance from the Ministry of Trade, Industry and Environment, and inspections by various agencies. One of the most time-consuming procedures is obtaining a “no objection” letter from the Directorate of Land and Property, which can take up to 6 months if the applicant is an outsider.

Additional Costs

While the building permit itself is issued at no charge, additional costs arise during the process. For example, applying for a water and sewerage connection requires an inspection, which can take up to 50 days and cost USD 500.

The Need for Improvement

Timor-Leste ranks 164th out of 190 economies in the Ease of Doing Business index, with construction permits being one of the biggest hurdles for businesses. The government has acknowledged the need to streamline the process and reduce bureaucratic red tape. In recent years, there have been efforts to simplify procedures and increase transparency in the system.

Priorities

However, more needs to be done to make it easier for businesses to operate in Timor-Leste. The government must prioritize improving the construction permit process to attract more investment and stimulate economic growth.

Key Statistics

  • Average time to obtain a building permit: 88 days
  • Number of procedures required: 13
  • Cost of applying for water and sewerage connection: USD 500
  • Ranking in Ease of Doing Business index: 164th out of 190 economies