1. Jordan Business Inspection Reform Program Amman - Jordan 3 rd June Jawaher Al Tawara - IFC Najwa Halasa – Ministry of Industry, Trade and Supply

2. 10 Government inspectorates fall within the scope of the program many of them have branches in 12 governorates 45 joint inspection committees Population 6.4 million Area 89,342 km 2 Geographically subject to the same regulatory systems (except Aqaba and development zones) 165,879 economic enterprises (45.8% in Amman) Individually-owned enterprises 86.7% 70% of total enterprises registered in 2001-2011 91.5% of the enterprises employ less than 5 workers 35% of the enterprises are in the less-than $7,000 revenue category A special Food and Drug Administration (JFDA) was established in 2003. A special law was enacted making it the official body responsible for the food sector (the only case of sector-specific inspection in Jordan) Inspection reform was done in the Ministries of Labor and the Environment previously The legal framework regulating inspection includes a number of old legal references that need reviewing and that give undefined wide-ranging powers. This leads to overlap of authorities and tasks Jordan – Facts & Figures

3. Why Inspection Reform Program? Overlap, duplication and inconsistencies between different inspections. The weakness of the inspection planning process (long and short term). Weak mechanisms for communication and coordination with the private sector. Lack of clarity and consistency of inspection procedures. Lack of clarity in technical requirements and lack of information on them. Lack of Risk Assessment tools. The need to raise the capacity of the inspectors. Inspection processes lack databases and automation. Lack of, documentation and adoption of standard operating procedures/ forms/checklists Weakness of the sanction and fine system

4. Main Approach of Program The main approach of the Inspection reform Program is working on two pillars, Vertical and Horizontal Inspectorate 5 Inspectorate 4 Inspectorate 2 Inspectorate 3 Inspectorate 1 Inspectorate 6 Coordination and exchange of information Overlap and duplication Creating a national regulatory framework - Procedures - Competency of the inspectors - Clarity of requirements

5. Features of this Approach Improving efficiency and effectiveness of inspection Better compliance Reducing overlap & duplication Reducing unnecessary burdens on the private sector Building a comprehensive and integrated national inspection system that serve all business sectors/private sector and take into account the national protection controls This approach can help provide important secondary products such as: 1.A database of economic enterprises in Jordan 2.A database of legal and technical requirements for business owners 3.Identifying the regulatory lead entity by sector / inspection area (function)

6. Areas of Inspection Covered by the Program Public Health Public Safety Occupational Safety & Health Protection of environment Protection of workers’ rights Inspection for licensing

7. Components to be Presented 7 Horizontal Pillar Reducing overlap and duplication Creating a National Regulatory Framework Vertical Pillar Inspection Manuals and Standard Operating Procedures (SOPs)

8. First: Preparing Inspection Manuals and Standard Operating Procedures Contents of the manual ♦ The legal framework ♦ The Economic framework and the sector's contribution to the national economy ♦ The Institutional framework (ministry/corporation/Inspectorate) ♦ The powers of the inspector and the sources of authority ♦ Planning and implementation of inspection visits ♦ Types of inspection ♦ Code of conduct ♦ Booklet on inspectors’ basic skills Development and documentation of inspection procedures in a number of inspectorates including preparation of an inspection manual and standard operating procedures (SOPs). Where Inspection phases were re-engineered according to the international best practices in order to: - Achieving a uniform and ideal vision of how inspections should be conducted - Introduction to the automation phase (IIMS) that should be based on the SOPs

9. 1.Enterprise Mapping 2.Inspection Planning 3.Routine inspection 4.Follow-up inspection 5.Special Inspection 6.Complaint-based Inspection 7.Enterprise Licensing - in specific inspectorates 8.Customer Appeal 9.Customer Feedback 10.Maintenance and updating of the standard documents The SOPs

11. Types of the SOPs Identifying enterprises subject to inspection (Mapping) Inspection planning Inspection visits (Routine, follow-up, complaint- based,…) Supplementary procedures (Customer Feedback, Customer Appeal, Maintenance of the standard documents)

12. SOPs of the Inspection Visits proactive procedures (Periodic Inspection) “pre-starting operations” procedures (for licensing) Reactive procedures (follow-up inspection, inspection based on a complaint,...)

13. General structure of an inspection visits procedure Post-visit stage Conducting of the visit Pre-visit stage ‒Advance notice on the visit ‒Coordination with the team / transportation ‒Reviewing previous reports ‒Preparing requirements of the inspection visit -Introductory meeting -Inspection visit and filling inspection forms -Closing meeting -Preparing the visit report -Getting approvals on the report -Ensuring that business owner receives a copy of the report -Documentation and archiving

14. Performance indicators related to the SOPs 1.Indicators related to the number of enterprises within a database, and enterprises that were visited and their categorization by risk level 2.Indicators related to the number of inspection visits and their categorization by type (periodic, based on a complaint,...) 3.Classification of inspection visits by the results (Fines, warning, Closure,...) 4.Number of Appeals and classification of the feedback 5.Evaluation of the manual and procedures review process and modifying them 6.Achievement on the monthly and annual action plans

15. Second: Reducing Overlap and Duplication Objective: Identifying areas of overlap, duplication, inconsistency and redundancy in business inspection by monitoring, identifying and analyzing regulatory frameworks for the work of inspectorates. This includes: First: legal review:  Collecting laws, regulations, instructions, decisions, local and international agreements, and memoranda of understanding governing inspection in different ministries and corporations in order to identify areas of overlap, and duplication occurring in all legal references for inspection and classifying these references by type of inspection. Second: Institutional Review:  Includes studying administrative and organizational aspects of inspectorates at the Capital and governorates, in order to assess the readiness of different inspectorates to adopt recommendations to reduce overlap and duplication, which include:  Organizational structure, authorities, roles, and geographical and sectoral coverage  Inspection cadres and joint committees  The number of inspection visits and resulting measures

16. Main inspection areas Workers' rights and OSH Public safety Environment & water Public health, food and drugs

17. Analysis methodology 17 1. Collecting and classifying data which include legal and institutional instruments that collected through meetings and reviewing relevant documents. 2. Defining the inspection areas, primary and secondary tasks, and ministry/corporation within and outside the area. 3. Identifying the methodology and criteria of legal evaluation and implementing it.  Reviewing the legal basis  The extent of the overlap of authorities between legal instruments in terms of: o The scope of work and tasks o The sectors o Geographical coverage  Level of duplication in requirements within the legal instruments: o The similarity of the legal/ technical requirements requested from business owners o Contradictions in legal/ technical requirements requested from business owners  Analysis of articles in terms of practices related to the following principles: o Clarity and transparency of articles o The principle of gradual escalation of penalties o Procedures for appeal and review

18. 18 4. Determining the methodology and criteria for institutional evaluation and implementation through: ‐ Reviewing the vision and mission of all the ministries/corporations within the area ‐ Identifying tasks carried out by the relevant directorates/inspectorates ‐ The extent of overlap of institutional work in terms of: o The scope of work and tasks o The sectors o Geographical coverage ‐ Studying the organizational structure, management tools and mechanisms for risk assessment: o Organizational structure of inspectorates and human resources o Inspection tools, inspection manual and SOPs o Quantitative inspection data ‐ Institutional coordination processes o Joint inspection committees (permanent) o Signed memoranda of understanding

19. 19 5. Reviewing examples of international best practices in business inspection and the responsibilities of public entities. 6. Identifying recommendations based on the outcomes of the legal and institutional review, which include: ‐ Determining the legal impact in the event of legal overlap between different legal instruments ‐ Determining the regulatory entity responsible within the inspection area ‐ Determining the inspection body responsible within the inspection area

20. Recommendations  Transferring authorities from one ministry/corporation to another ministry/corporation  Merging inspectorates by jurisdiction, which may require changing the organizational structure and transferring some staff  Specialization of a certain inspectorate in a specific economic sector so that it conducts all routine inspection activities on behalf of all (or some) other inspection entities  Specialization of a certain inspectorate in a specific geographic area (especially relatively distant governorates) so that it conducts all routine inspection activities on behalf of all (or some) other inspection entities Challenges  The size of the legal and technical references that govern inspection, estimated at hundreds of references  The need for an in-depth institutional review of all relevant inspectorates and their respective corporations/ministries to come out with scientific, practical and viable recommendations that are agreed upon by all stakeholders  Lack of easily accessible information, which is scattered among the relevant entities  Achieving consensus on the recommendations, which is expected to lead to radical changes in the overall framework of inspection in Jordan  The need to develop detailed action plans for implementing the recommendations that protect the rights of employees, study alternative sources of revenues, and all aspects affected by enforcement of the recommendations. Expected Recommendations and Challenges

21. Third: Creating a National Regulatory Framework 21 Target Building a solid structural to ensure the institutionalization of inspection reforms and their implementation on the general national level and by the inspectorates involved through the establishment of a national body to be adopted as a sole authority responsible for the development and reform of the inspection on business in Jordan

22.  Legal framework: the Prime Minister's Decision No. 1703, issued in October 2012 for the formation of the Higher Committee for the program  Authorities and duties  Organizational Structure  Secretariat of the Higher Committee: Provide all forms of support to the work of the Higher Committee, technical committees and working groups emanating from HC, preparing relevant reports, and communicating with all stakeholders  Technical committees and working groups: The formation of technical committees by area of ​​ reform, with the participation of staff from the inspectorates concerned who have experience and competence, with the possibility of seeking the assistance of local and international experts according to a clear timeframe, where clear, practical and applicable proposals for improvement are submitted to the HC  Role of the private sector: private sector representatives can be invited to participate in the higher committee meetings for coordination and consultation purposes when needed. Components of the current regulatory framework The current framework The Higher Committee (HC) of the National Program for inspection on Business Reform

23. Supervising the implementation of the national program of the inspection reform Monitoring the implementation of requirements of reform and development in various areas of inspection Evaluating recommendations made on the areas of reform Forming working groups and technical committees Strategic Planning for inspection in accordance with best practices Developing a national business inspection system and raising its efficiency and effectiveness in accordance with international best practices in this field Main tasks of the Higher Committee

24. Council of Ministers Economic Development Committee/ Prime Ministry Chairperson of the Higher committee Minister of Industry and Trade and Minister of Public Sector Development Rep of MoPIC Sec Gen, MoA Sec Gen, MoE Chairman of the Committee of GAM Dir Gen, Civil Defense Sec Gen, MoH Sec Gen, MoL Sec Gen, MoTA Sec Gen, MoEMR Secretariat/ MoIT Technical Advisor/ IFC Inspectorates – Working Groups – Technical Committees (Formed on an ad hoc basis) Inspectorates – Working Groups – Technical Committees (Formed on an ad hoc basis) Dir Gen, SSC Dir Gen, FDA Sec Gen, MoWI Sec Gen, MoMA Sec Gen, MoPSD Dir Gen, NITC Sec Gen, MoIT Organizational Structure of the Higher Committee

25. 25  Higher Committee Inspection Coordination council  Current legal framework Institutionalizing the jurisdiction of the Higher Committee by enacting a law that generally governs the general principles of inspection  Role of Private sector Selecting private sector representatives to be permanent members in the higher committee with the right to vote on it’s decisions or forming an advisory council for the HC consists of private sector representatives The Desired National Framework

26. Discussion & Questions Thank you 26