Dealing with Construction Permits in
Guatemala
Below is a detailed summary of the procedures, time and costs to build a warehouse in Guatemala. This includes obtaining necessary licenses and permits, completing required notifications and inspections and obtaining utility connections.
This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 185 economies. The most recent round of data collection was completed in June 2012. Read the methodology.
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Estimated Warehouse Value:
GTQ 1,560,720
- City: Guatemala City
| No. |
Procedure |
Time to Complete |
Associated Costs |
| 1 |
Request and obtain certificate of land ownership for the property where the warehouse is to be built
The certificate is valid for 3 months. Since August 2007 the fee related to obtaining the certificate of land ownership has been increased from GTQ 35.00 to GTQ 50.00.
Agency: General Property Registry (Registro General de la Propiedad)
|
10 days
|
GTQ 50
|
| * 2 |
Hire an Environmental Specialist and prepare an Environmental Impact Assessment
The environmental impact assessment must be prepared by a professional (engineer/architect) authorized to do so. The company owning the project must hire the professional, and the cost will vary depending on the type of assessment to be completed, based on project characteristics. In many cases technical opinions or analyses by several professionals are required. The minimum cost is GTQ 40,000.00. Projects exceeding 1,000 sq. m. require an Environmental Impact Assessment.
Agency: Independent specialist
|
30 days
|
GTQ 40,000
|
| * 3 |
Submit a Brief or Simple Industrial Report
This report contains an affidavit regarding storage use and any industrial process to be carried out in the warehouse.
Agency: Environment and Industry Unit (Sección de Ambiente e Industria), Construction Licensing Department (Departamento de Licencias de Construcción)
|
1 day
|
no charge
|
| 4 |
Request and obtain a favorable decision by the Ministry of the Environment and Natural Resources (Ministerio de Ambiente y Recursos Naturales) based on an Environmental Impact Assessment
The environmental impact assessment along with application is submitted to the Ministry of the Environment and Natural Resources (Ministerio de Ambiente y Recursos Naturales, MARN) personnel. Then the documents are forwarded to Guatemala Municipality Delegate at the MARN who reviews the proposal. This professional is hired by MARN but paid for by Municipality of Guatemala City.
As soon as the documents are submitted to delegate BuildCo would have to publish the information about upcoming project in the local newspaper. After 20 working days of wait, which are given for public to respond upon the project, the delegate proceeds with approval of the impact assessment.
The favorable decision, provided everything is correct will be issued 7 working days after that. If the judgment is unfavorable, the company owning the project must make the necessary corrections for the project to be approved. Previous to reform this procedure would take 60 days and now can be completed in 40 days. There is no fee associated with obtaining the approval.
Agency: Ministry of the Environment and Natural Resources (Ministerio de Ambiente y Recursos Naturales) /Municipality of Guatemala
|
40 days
|
no charge
|
| 5 |
Request and obtain a Construction License
The Municipality of Guatemala City introduced as of January 7, 2009 a new Land Management Plan (Plan de Ordenamiento Territorial- “POT”), and new building control regulations that also regulate the construction permit issuance. According to the new POT of Guatemala City the land use classifications were changed based on the principles of sustainability, certainty, and better quality of life. In the old system the land was divided into industrial, residential, and commercial zones, whereas, the new zoning regimes are established according to general use of land which among others introduced mixed use of zoning regimes. This tool was developed in consultation with both private and public sector and widely publicized. It also introduces a more sophisticated risk based system of approval of construction permit. Before, the application had only one process of approval, whereby the application would be classified as complete, and compliant with all requirements. This led to issuance of construction permit. However, if incomplete it would need to be corrected. Under the new implementing regulations of POT this mechanisms is based on three stages: Simplified Procedure (Precedimiento Directo); Approval of Land Management Council (Junta de Ordenamiento Territorial); Approval of Land Management Council and Neighbours’ Consent. Each phase is triggered if previous phase is not complied with.
BuildCo's case would fall into the ‘Simplified Procedure' scheme and does not require subsequent procedure with Land Management Council and neighbors. Under this scheme if all requirements established in the regulations are satisfactory and complied with, the application would be approved in 10 working days. As of February 28, 2009 out of 580 applications for a new construction permit to the Central Territorial Directorate under the Municipality of Guatemala City (Direccion Central Territorial) 40% of cases went under simplified procedure and approved within this time-limit. This procedure is administered under a newly operationalized single window principle. Additionally, the application forms have been substantially simplified and reduced in volume from 27 pages to mere 3 pages.
BuildCo must submit the corresponding form with all the requested specifics together with all the requirements in the previous procedures, photocopies of the identification cards of its legal agent and the professional responsible for the construction, and a photocopy of the latest Single Real Estate Tax (Impuesto Unico sobre Inmueble) receipt and any other required receipts. An architect or engineer must be responsible for the construction work, signing the submitted form and the plans.
The cost of the license is the estimated based on warehouse value at 4.5%.
There is no time limit. This procedure depends on the time taken by the company applying for the license to complete all the requirements. If any requirements are still pending and there is no action on the record after 60 days, the process is deemed canceled and is sent to the general files, after which the company must start another application. If BuildCo starts the procedures for the license application with all requirements in order and duly authorized (approved decisions and resolutions), the license may be delivered after a minimum of 4 working days.
According to law, required deposits are as follows:
• Article 183: The recipient of a construction license must make a guarantee deposit of GTQ 5.00 (for buildings up to a cost of GTQ 5,000.00) or 0.01% of the cost of the building (if the cost exceeds GTQ 5,000.00). For our case it would be GTQ 380.20. This amount shall be refunded when the building has been completed and the license has been returned after the approval of the Construction Licensing Department. Provided there were no violations upon which the authority would retain the deposit.
• Article 184: If, after a year from the date of license expiration, the interested party does not claim the deposit, it will automatically be incorporated into the municipal treasury.
Agency: One-Stop center under the Municipality of Guatemala City
|
14 days
|
GTQ 70,232
|
| 6 |
Notify the Construction Licensing Department on construction completion and return the license
The license must be returned to the Construction Licensing Department, which performs the last inspection. If the construction work conforms to approved specifications, the occupancy permit is issued. When the license is returned, the municipality notifies the cadastre office about the construction and its cost. Within 7 -- 14 days, the municipality visits the site to verify that the building complies with approved specifications.
Agency: Construction Licensing Department (Departamento de Licencias de Construcción)
|
1 day
|
no charge
|
| 7 |
Receive final inspection and obtain occupation permit
According to Article 78, on completion of the construction work, the interested parties shall request final inspection from the Construction Licensing Department. This inspection shall be performed by the supervisor in charge, who shall record the result on an inspection card. If the building does not comply with approved specifications, the card must state the reasons and the appropriate remedies. If all aspects are in order and the card expressly states so, after the return of the respective license, the interested parties may request the building occupancy permit from the head of the office by completing the form stated in Annex 1 of the Regulation.
If no objections are raised during the inspection (meaning that every part of the construction is authorized as complying with the plans submitted to the Construction Licensing Department, the professional in charge of the inspection may immediately go back to the office and issue the occupancy permit to be delivered to the company. After that BuildCo will be given back its deposit of 0.01% of warehouse value that was paid at the stage of building permit approval.
Agency: Construction Licensing Department (Departamento de Licencias de Construcción)
|
14 days
|
no charge
|
| * 8 |
Request sewage connection and receive requirements from EMPAGUA
BuildCo must fill out the application and receive the requirements at office of the Water and Sewerage Authority (Empresa Municipal de Agua, EMPAGUA). There they will be notified of the fee to be paid as a deposit to cover the completion of the procedure and a service feasibility study that must be carried out by EMPAGUA. EMPAGUA will start the feasibility study within about 15 days.
In 2007 the Municipality of Guatemala unified the application forms and relevant requirements for EMPAGUA, Department of Urban Construction Control (Departamento de Control de Construcción Urbana) and Infrastructure Directorate (Dirección de Infraestructura). Other change is that approvals from all these entities are given simultaneously. However, has not had any practical impact.
Agency: Municipality (EMPAGUA)
|
20 days
|
no charge
|
| * 9 |
Request and obtain a feasibility study by EMPAGUA
According to regulatory changes this procedure should be done in 27 working days. The EMPAGUA must issue a resolution regarding feasibility or nonfeasibility and the steps to be taken by BuildCo for EMPAGUA to make the necessary hook-up connections. On completion of the feasibility study, EMPAGUA notifies the applicant of the amount to be paid to the municipality for the feasibility study and the connections to be made. The cost may vary depending on the work to be done and the estimated required potable water supply and sewage volume to be drained from the project.
The inspections performed by EMPAGUA experts may vary depending on the number of inspections needed to determine service feasibility. The human resources of EMPAGUA are overstretched which creates a backlog of projects and approval still takes on average 60 -- 70 days.
Agency: Municipality/EMPAGUA
|
70 days
|
no charge
|
| * 10 |
Receive connection to water
Agency: Municipality/EMPAGUA
|
60 days
|
GTQ 8,800
|
| * 11 |
Obtain a telephone line
Agency: Any of the 4 private telephone companies
|
1 day
|
GTQ 625
|
* Takes place simultaneously with another procedure.
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