C.H. Montin, Ankara 12 May Ankara, 12 May 2014 Selected techniques to reduce legislation and deregulate Charles-Henri Montin, Smart Regulation Consultant Former Senior Regulatory Expert, Ministry of economy and finance, Paris

C.H. Montin, Ankara 12 May Contents  What is deregulation?  Issues governing deregulation  List of reviewing techniques (World Bank)  Deregulation as part of a systemic policy (UK example)  Selected operational techniques –Administrative Procedure Reengineering –Guillotine –Statute law revision  How to enact deregulation (drafting examples)

C.H. Montin, Ankara 12 May What is deregulation?  Regulatory policy supports two objectives  1/ maintenance of legal corpus by regular operations of review and deletion of obsolete texts  2/ “freeing-up” the economy by seeking a reduction in the overall volume of legislation: –Follows evaluation and stakeholder input on obstacles to economic performance –Usually addresses key sectors such as telecoms, energy, etc

C.H. Montin, Ankara 12 May Issues governing deregulation  Great variety in diagnostic tools to identify the texts that can be abolished: –Ex-ante: review and sunset clauses –Ex-post: guillotine, process reengineering  But deletions must respect legal constraints in force –Hierarchy of norms must be respected –Need for good legal drafting to target the right articles without jeopardising legal security

C.H. Montin, Ankara 12 May “Selected” tools for reviewing regulatory stock  Process re- engineering  Doing Business indicators and reforms  Standard cost model  The Guillotine  Bulldozer  Scrap and build  Staged repeal  Review and sunset clauses  Statute law revision  Codification  Recasting  Consolidation World Bank manual

C.H. Montin, Ankara 12 May Deregulation in context (UK example) “To eliminate the avoidable burdens of regulation and bureaucracy, the Government will: – Remove existing regulation that unnecessarily impedes growth; – Introduce new regulation only as a last resort; – Reduce the overall volume of new regulation; – Improve the quality of the design of new regulation; – Reduce the regulatory cost to business and civil society groups; – Move to a risk-based enforcement regime where inspections are minimised. “

C.H. Montin, Ankara 12 May Definition of review and sunset clauses  A “review clause” imposes a statutory duty to carry out a review of the relevant regulation on a specified timescale but does not provide for automatic expiry  A “sunset clause” provides for automatic expiry after a specified period (meaning that further legislative action is required for the regulations to remain in force, with or without modifications).  Regulatory policy can include a published government statement as to the expected use of such mechanisms, and which areas of legislation would be targeted.

C.H. Montin, Ankara 12 May The purpose of Sunsetting (UK)

C.H. Montin, Ankara 12 May Drafting a review + sunset clause  Citation, Commencement, and Expiry  (1) These Regulations may be cited as the [ ] Regulations 201*.  (2) They come into force on (date).  (3) They cease to have effect on at the end of the period of seven years beginning with the day on which these Regulations come into force.  Review [This should be placed after the provisions to be reviewed]  (1) Before the end of the review period, the Secretary of State must— –(a) carry out a review of these Regulations, –(b) set out the conclusions of the review in a report, and –(c) publish the report.  (2) The report must in particular— –(a) set out the objectives intended to be achieved by the regulatory system established by these Regulations, –(b) assess the extent to which those objectives are achieved, and –(c) assess whether those objectives remain appropriate and, if so, the extent to which they could be achieved with a system that imposes less regulation.  (3) “Review period” means the period of five years beginning with the day on which these Regulations come into force.

C.H. Montin, Ankara 12 May Administrative procedure reengineering

C.H. Montin, Ankara 12 May How to give legal effect to reengineering  Once the flow chart has been established, identify the legal articles that support each stage  Discuss with substantive departments the utility of each stage, with special attention to certain phases like external advice, reporting, statistics  Achieve consensus on simplification of the process by deletion/reduction of certain requirements  Draft corresponding reform text to enact the reforms

C.H. Montin, Ankara 12 May Guillotine: definition and purpose  process of counting and then reviewing a large number of regulations against some criteria  Characterized by reversal of burden of proof  Used for liberalising the national economy Examples  removing regulations not consistent with a market democracy (Hungary),  Simplifying business formalities (Mexico),  Supporting licensing reforms (Kenya,  Reducing bureaucracy (Viet Nam)

C.H. Montin, Ankara 12 May The guillotine process (WB)  Legal act to establish scope, process, project structure and schedule  On instruction, departments draw up inventory of existing procedures and supporting regulations  Inventory includes self-assessment according to a checklist: necessity, legality, business- friendliness  Classification into “retain”, “eliminate”, “revise” is verified by an independent body  Government deletes in one decision (list)

30/04/14C.H. Montin, Ankara 12 May 2014 Guillotine: enactment  Government decision enacting the deletions Or  Preparation of draft primary legislation  Example: Viet Nam - To implement the simplification of these 258 procedures, 14 laws, 3 ordinances, 44 decrees, 8 Prime Minister’s decisions, 67 circulars and 33 ministerial decisions have to be amended. - For simplification that does not require the changing of laws and ordinances, ministries and agencies were held responsible for issuing the amended documents. - However, amendments to laws and ordinances are needed to simplify most of the APs. Ministries and agencies were asked to develop by 30 November 2010 draft laws and ordinances to amend, supplement, replace or abolish relevant regulations. These drafts were to be sent to the Ministry of Justice where they would be compiled into (an) omnibus law(s) and then submitted to the Government for consideration and decision, before being approved by the National Assembly.

30/04/14C.H. Montin, Ankara 12 May 2014 Statute law revision  a tool to remove laws obsolete or not longer of practical utility  Drafting Example from Australia  STATUTE LAW REVISION ACT 2011 (NO. 5, 2011) - SECT 3: Schedules Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.

30/04/14C.H. Montin, Ankara 12 May 2014 The French model of deregulation “Loi anti-loi” technique  Chapter V (of the law on legal simplification) Repeal of miscellaneous clauses Article 13. Are and remain repealed: 1° Article L of the national service code; 2° The law dated 27 November 1790 creating a supreme court, and setting its powers, organisation and composition; 3° the decree of 19 and 22 July 1791 instituting a municipal and correctional police; Etc until number 137: law of 22 May 1946 creating a national council of labour.

30/04/14C.H. Montin, Ankara 12 May 2014 The Italian guillotine Legge “taglia-leggi”  Launched by law dated 28 November 2005  Projected database of the full corpus of legislation published in the official gazette (450k texts)  Law 6 August 2008 repeals 7000 laws, and L. 19 February 2009 abolishes 28,909 acts  Uses both explicit and implicit repeals  In some sectors, all acts are deleted unless explicitly re-instated (which was a major operation) (“salva-leggi” acts)  Quality, not only quantity, concerns

C.H. Montin, Ankara 12 May To continue the study… Tools and Approaches to Review Existing Regulations  World Bank: Tools and Approaches to Review Existing Regulations: RGTools.pdf RGTools.pdf  Further questions contact: smartregulation.net