Puerto Rico private sector calls Permits Regulation regressive

Months after it came into effect, organizations find it increases costs

SAN JUAN — Puerto Rico United Retailers Association (CUD by its Spanish acronym) President Jorge Argüelles and various small and midsize business organization leaders charged on Wednesday that the Joint Permits Regulation is regressive and is duplicating the costs of obtaining permits. 

Close to a dozen business organizations rejected the measure, which went into effect in June. In a news conference at CUD headquarters in Hato Rey, Argüelles said that the new permits regulation under Act 19 of 2017, which amended and repealed some sections of Act 161 of 2009, duplicates some of the requirements and increases the cost of doing business on the island.

“One of the main concerns the business sector has is that the Construction Codes are applied retroactively, which imposes additional requirements that are more onerous,” Argüelles said. 

The new law also creates the Single Use Permit, consolidating the process to obtain a use permit, along with certifications for fire prevention, environmental health and other licenses and authorizations into a single permit.

“The main problem that businesses are facing is that the single use permit is considered as new permit, even if the business has been operating for decades, and some agencies, such as the Fire Department and the Permits & Endorsements Management Office [OGPe by its Spanish acronym] enforce and demand compliance with the dispositions of the Construction Code and Fire Code, retroactively,” Entrepreneurs for Puerto Rico President Enid Monge added. “This interpretation is incorrect and contradicts the International Construction Code, on which the code in Puerto Rico is based.”

The vice president of the Puerto Rico Chamber of Food Marketing, Industry & Distribution (MIDA by its Spanish acronym), Manuel Reyes, explained that the joint regulation also requires renovating the single use permit annually, when in the past a business did not have to renew permits so long as the business remained unaltered.

“In these annual renewals [of permits] they are demanding the presentation of multiple documents year after year,” Reyes stressed. “The dispositions of this regulation complicates the process and reverts decades in advances achieved to facilitate and speed up the commercial management.”

Caribbean Business left a request for comment regarding the private sector complaints.

The Permitting Reform Act seeks to streamline the process for businesses and attract new investments. The joint permit regulation and the new permitting products became available in the Single Business Portal, Economic Development Secretary Manuel Laboy said at the recent hearing held by the Financial Oversight & Management (FOMB) on the ease of doing business.

However the private sector representatives said the Single Business Portal is complicating the processes, while asking business owners to renew numerous permits annually, making the process more onerous.

Puerto Rico Funeral Home Association President Eduardo Cardona, meanwhile said, that now three different permits have to be obtained.

“To give you an idea of how absurd this regulation is, funeral homes are required to obtain three different use permits, one for the chapel, another for the funeral services and another one for the embalming room, even when the three services are tied together and are components of the same operation and service,” Cardona assured. “This applies to all business sectors. Our certifications are valid for three years, but now this regulation changes this validity to annual periods. This change triples our costs of doing business. The problem is that as our costs increase, we have no choice but to increase prices, impacting the pocket of the consumer, who is itself in a poor [financial] condition. The biggest problem is that the law dictates one thing and the agencies do another.”

The business representatives said that they wrote Gov. Wanda Vázquez a letter several weeks ago, requesting a meeting to see if she can have the regulation revoked. They said they are still waiting for a response from the governor and did not rule out taking the matter to court.

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