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Ease of Doing Business in

United Kingdom

United Kingdom Download Profile (1759.2KB, pdf)
Region OECD high income
Income Category High income
Population 65,138,232
GNI Per Capita (US$) 43,340
City covered London

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 7 6 down
1
82.74 82.73 down
0.01
Starting a Business 16 13 down
3
94.58 94.57 up
0.01
Dealing with Construction Permits 17 16 down
1
80.34 80.29 up
0.05
Getting Electricity 17 15 down
2
89.12 89.12
-
Registering Property 47 46 down
1
74.11 74.50 down
0.39
Getting Credit 20 19 down
1
75.00 75.00
-
Protecting Minority Investors 6 5 down
1
78.33 78.33
-
Paying Taxes 10 11 up
1
90.74 90.37 up
0.37
Trading across Borders 28 28
-
93.76 93.76
-
Enforcing Contracts 31 30 down
1
69.36 69.36
-
Resolving Insolvency 13 13
-
82.04 82.04
-

DB 2017 Rank:

17

DB 2016 Rank:

16

Change in Rank:

down1

DB 2017 DTF (% points):

80.34

DB 2016 DTF (% points):

80.29

Change in DTF (% points):

up0.05

STANDARDIZED WAREHOUSE
Estimated value of warehouse GBP 1,404,520
City London
Indicator United Kingdom OECD high income
Procedures (number) info_outline 9 12.1
Time (days) info_outline 86 152.1
Cost (% of warehouse value) info_outline 1.1 1.6
Building quality control index (0-15) info_outline 9 11.3
  • Measure of efficiency
    No. Procedure Time to Complete Associated Costs
    1

    Obtain planning permission

    Agency: Planning Department of Local Authority

    BuildCo must obtain planning permission from the local planning authority. In London, the decision-maker is the relevant London borough where the site is located. There are 33 boroughs in Greater London.

    The planning application must be accompanied by a plan of the site, drawings showing the proposed development, and any other information the local authority considers necessary. The local authority publishes a list with the information it considers necessary on its website, so that applicants know what is required of them. The relevant legislative framework is the Development Management Procedure Order (2010). If BuildCo is submitting a paper application, it must also provide at least 3 copies of the accompanying documents. Alternatively, BuildCo can apply online via the Planning Portal, which accepts electronic planning applications on behalf of all London boroughs, using a standard application form that was introduced across England in 2008. If it applies electronically, no further copies are required. A fee is charged for the planning application, based on the amount of floor space that would be created by the scheme.

    The size of BuildCo's proposed development falls below the threshold for a “major application”, which means that the time frame for a decision is 8 weeks rather than 13. During this period, the local planning authority will publicize the application in the surrounding area and consult a number of statutory consultees -- bodies with a specialist responsibility such as nature conservation, heritage protection, highways -- who may wish to comment on the acceptability of the proposal from their perspective. The local authority accepts these comments and the comments of any local people who wish to comment on the application. They will be taken into account in the decision to grant or refuse permission. If no decision is made within 8 weeks, or if the authority decides to refuse permission, the applicant is entitled to appeal to the Secretary of State.

    Additionally, in April 2010, the Government introduced new 'permitted development' rights for businesses who seek to extend their existing premises. This means that minor extensions, which would previously have required planning permission, may proceed without it, thereby saving time for the business owners and enabling the local planning authority staff to concentrate on larger and more important projects. In May 2013, the Government further extended these rights to allow for larger extensions of pre-existing agricultural buildings and warehouses.

    56 days GBP 6,676
    * 2

    Hire an Approved Inspector

    Agency: Approved Inspector

    BuildCo signs a contract with an Approved Inspector. Approved Inspectors (AI) are companies or individuals authorized under the Building Act 1984 to carry out building control work in England and Wales.

    An Approved Inspector will:
    • Advise BuildCo on how the building regulations apply to its work (to a degree)
    • Check plans for compliance with building regulations
    • Issue a planning certificate (if requested)
    • Inspect the work as it progresses
    • Issue a final completion certificate (if requested)

    The building control process was extended under the Building Act 1984 to include AIs as well as Local Authorities. Currently, there are 91 AIs on CICAIR Limited's register covering England and Wales, accounting for about 60% of all building control work. AIs are licensed by CICAIR Limited for every 5 years. A list of AIs is available from the Construction Industry Council website.

    Local Authorities have statutory time limits of 6 to 8 weeks for approving plans while AIs do not have any time limits so may provide a faster turnaround. By hiring AIs it eliminates need for companies to deal with the Building Control Department at the Local Authority. However, the Local Authority is still responsible for the enforcement of the regulations. AIs usually operate nationally and bring consistency of interpretation of the Building Regulations.
    While the planning permission (consent) is being obtained from Planning Department in Local Authority, the AI sends an Initial Notice to the Building Control Departement of Local Authority to inform them that it will take responsbilty over the building control process. The Local Authority Building Control Departement has 5 days in which to reject the notice.

    If the Initial Notice is not rejected within 5 days construction work may begin. AI, for BuildCo's case, would conduct approximately 8-9 inspections at various stages of construction on a risk assessment basis.

    AIs are in competition with local authority building control and have no restrictions on how much they can charge. AI fees are usually lower than local authority building control who are covered by the Building (Local Authority Charges) Regulations 2010 which requires local authorities to fix their charges by means of a scheme, full cost recovery and the fact that the user should pay for the actual service they receive. The cost for the services of AI is comprised of several elements and is mostly charged on a hourly rate. The below estimate is a sample of what an average cost breakdown by an AI looks like:

    • Plan checking: (16 hours x GDP 60) = GBP 960.00
    • Inspections: (9 sessions x 2h x GBP 60.00) = GBP 1,080.00
    • Structural checking: (2 hrs x GBP 60.00) = GBP 120.00
    • Consultations: (0.5 hrs x GBP 60) = GBP 30.00
    • Electronic/Internet drawings GBP 75.00
    • Meetings: (3.75 hrs x GBP 60.00) = GBP 225.00
    • Administrative: (0.5 hrs x GBP 60.00) = GBP 30.00
    • Inspections petrol fee: (40 miles x GBP 3.60) = GBP 144.00
    • Contingency: (5 hrs x GBP 60.00) = GBP 300.00

    Total: GBP 2,964

    1 day GBP 2,964
    3

    Approved Inspector files the initial notice to the Local Authority

    Agency: Local Authority

    Once the contract is signed and the terms of reference are outlined, the builder and the AI jointly notify the local authority of their intention to build -- also called an initial notice. This initial notice will inform the Local Council that the AI has been retained. Once this notice has been accepted by the local authority, the responsibility for plan checking and site inspection will be formally placed on the AI.

    The local council has 5 days to accept or reject the initial notice in writing (via email, fax or post). Acceptance is given by default if the local authority does not respond within the 5-day period. During that period of time, no work can be done.

    Once construction work commences, the AI would conduct at least 8 -- 9 inspections at various stages of construction and risk-based factors (for BuildCo’s case).

    5 days no charge
    4

    Apply for water and sewage connection

    Agency: Thames Water Utilities Ltd.

    1 day no charge
    5

    Receive inspection from the water and sewage provider

    Agency: Thames Water Utilities Ltd.

    Upon approval the engineer instructs Thames Water’s contractor to assess the physical work involved to make the connection. This includes a site survey, size of site gang/workforce, equipment and materials needed, plus any involvement with the local highway department as to whether there is any significant impact on the public road network. This element takes approximately 2-3 weeks.

    The contractor will then send their report to the engineer with the scope of work, survey and technical proposal. The engineer will prepare and authorize the quote and send it out to BuildCo within 5 days of receipt of the contractor’s report.

    1 day no charge
    6

    Submit application to local Fire and Rescue Authority and obtain approval

    Agency: Fire and Rescue Authority

    Approved Inspector submits (via mail) the respective elements of the drawing and plans pertinent to fire safety to a local Fire Safety Office to ensure that the building is compliant with the latest fire safety legislation and that the appropriate fire and life safety systems are in place. By law, the Fire Safety Office must respond within 15 business days (21 calendar days) and send its comments and approval. This is done as part of plan approval process and is recorded as an independent procedure since AI interacts with a Fire Officer.

    Upon the completion of the building, BuildCo used to obtain a Fire Certificate from Fire Safety Office. However, the Fire Certificate is no longer required following the reforms in the Regulatory Reform (Fire Safety) Order 2005 (FSO 2005) which came into effect in October 2006, and replaced over 70 pieces of fire safety laws.

    The FSO applies to all non-domestic premises in England and Wales, including the common parts of blocks of flats and houses in multiple occupations (HMOs). The FSO 2005 is a tool for self-regulation of businesses for the fire risk of the premises.

    Under the FSO, the responsible person must carry out a fire safety risk assessment and implement and maintain a fire management plan. The companies have to carry out a risk assessment by completing a 5-step fire risk assessment survey online: (http://www.fire.gov.uk/Workplace+safety/WhatTheLawRequires/)

    According to this survey -- FSO 2005 the warehouse of BuildCo would be classified as medium risk object. Since there will be more than 5 people occupying/working in the building, BuildCo would need to file the copy of completed FSO 2005 to the local Fire Safety Office. BuildCo does not need to wait for the approval or any other consent before using the premises. This risk is with the building operators, as they are deemed liable for any problems.

    The Fire Safety Office may conduct an inspection under a risk-based scheme: whether there was a similar track record of companies with fire, or neighbors complain, etc. Small scale and standard objects would be seldom inspected. Also, given that this would be a new building it would be assumed by the Fire Safety Office that the latest techniques of fire safety prevention would have been considered during the planning process.

    21 days no charge
    * 7

    Obtain water and sewerage connection

    Agency: Thames Water Utilities Ltd.

    20 days GBP 5,321
    8

    Request and receive energy performance certificate from Accredited Energy Assessor

    Agency: Accredited Energy Assessor

    Following the nationwide implementation of the "Energy Performance of Buildings Directive" adopted, on December 16, 2002, as of October 1, 2008 all commercial buildings whenever built, rented or sold require an Energy Performance Certificate. The certificate records how energy effcient a property is as a building and provides A+ to G ratings. It is the responsibilty of the builder/constructor to give the Energy Performance Certificate to the Purchaser on physical completion of the building and notify the local authority Building Control officers or approved inspectors, who will not issue a Certificate of Completion until the issue of an EPC has occurred.

    They are produced using standard methods and assumptions about energy usage so that the energy effciency of one building can easily be compared with another building of the same type. This allows prospective buyers, tenants, owners, occupiers and purchases to see information on the energy effciency and carbon emissions from their building so they can consider energy effciency and fuel costs as part of their investment.

    An EPC always includes a recommendation report that lists cost effective and other measures (such as low and zero carbon generating systems) to improve the energy rating. A rating is also given showing what could be achieved if all the recommendations were implemented.

    The fee for producing an EPC is determined by the market and may vary between GBP 55.00 to GBP 100.00.

    1 day GBP 78
    9

    File completion certificate with the Local Building Control Department

    Agency: Local Building Control Department

    Once the building is completed, BuildCo would notify AI about the completion. AI completes the final inspection within 24 hours and prepares the final certificate of completion. AI will send a copy of the final completion certificate to the Building Control Department of Local Authority and BuildCo within 5 days after completion of the final inspection. The Local Authority keeps the final completion certificate in a public register. There would be no local authority inspection.

    1 day no charge

    * Takes place simultaneously with previous procedure.

  • Measure of quality
    Answer Score
    Building quality control index (0-15) 9.0
    Quality of building regulations index (0-2) 2.0
    How accessible are building laws and regulations in your economy? (0-1) Available online; Free of charge. 1.0
    Which requirements for obtaining a building permit are clearly specified in the building regulations or on any accessible website, brochure or pamphlet? (0-1) List of required documents; Fees to be paid; Required preapprovals. 1.0
    Quality control before construction index (0-1) 1.0
    Which third-party entities are required by law to verify that the building plans are in compliance with existing building regulations? (0-1) Licensed engineer; Private firm. 1.0
    Quality control during construction index (0-3) 3.0
    What types of inspections (if any) are required by law to be carried out during construction? (0-2) Inspections by external engineer or firm; Risk-based inspections. 2.0
    Do legally mandated inspections occur in practice during construction? (0-1) Mandatory inspections are always done in practice. 1.0
    Quality control after construction index (0-3) 3.0
    Is there a final inspection required by law to verify that the building was built in accordance with the approved plans and regulations? (0-2) Yes, external engineer submits report for final inspection. 2.0
    Do legally mandated final inspections occur in practice? (0-1) Final inspection always occurs in practice. 1.0
    Liability and insurance regimes index (0-2) 0.0
    Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1)  No party is held liable under the law. 0.0
    Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) No party is required by law to obtain insurance . 0.0
    Professional certifications index (0-4) 0.0
    What are the qualification requirements for the professional responsible for verifying that the architectural plans or drawings are in compliance with existing building regulations? (0-2) Minimum number of years of experience; Being a registered architect or engineer. 0.0
    What are the qualification requirements for the professional who supervises the construction on the ground? (0-2) Being a registered architect or engineer. 0.0