Licensing and Permitting

Principle 5: Streamline L&P processes and keep them flexible

 

Principle definition
Burdens and complexity should be minimised through streamlined and standardised L&P processes, supported by enhanced co-ordination across government. At the same time, these processes should be designed, implemented, and monitored with flexibility to adapt to changing needs and promote innovation, while making the best use of available resources.
Sub-principles	Criteria
5.1 Co-ordinate across government	Foster horizontal co-ordination among L&P authorities, but also vertically between different levels of government Share information relevant for L&P – what the activity is about, what risks it may create, and who may be impacted Follow a life event approach to consider the full experience of individuals and businesses
5.2 Simplify and standardise L&P to minimise complexity	Use only strictly necessary processes and information obligations Standardise L&P for clarity and efficiency
5.3 Keep L&P flexible and responsive to changing needs	Promote L&P tools and schemes that allow for innovation Streamline procedures for permit amendments where possible Implement adaptive L&P provisions for emergency situations

L&P processes should be designed to reduce burdens and complexity for regulated subjects while making the best use of available resources. Achieving this requires strong co-ordination across different levels of government, ensuring that licensing authorities work together to eliminate redundancies and streamline processes.

Standardising and simplifying L&P procedures are key to creating a more consistent, accessible system that supports compliance and reduces administrative complexity.

Equally important, L&P systems must be flexible and responsive to evolving needs and unforeseen challenges. By maintaining adaptability, regulatory frameworks can promote innovation and remain agile in the face of new technologies and emerging risks.

5.1. Co-ordinate across government

Foster horizontal co-ordination among L&P authorities, but also vertically between different levels of government. Efficient co-ordination requires the participation of different actors involved in L&P, from high-level strategy makers to operational roles, and across every level of government. This helps ensure an alignment of approaches, methods and requirements, while minimising duplications, overlaps or gaps in information collection and the management of L&P processes. Governments can consider setting up one-stop shops to introduce a centralised approach to permitting, in line with the OECD Best Practice Principles for One-Stop Shops for Citizens and Business (OECD, 2020[8]). Additionally, a key challenge in regulatory consistency arises when institutions use different risk assessment frameworks within the same regulatory area. In line with Principle 2, harmonising risk assessment tools across government levels can further streamline regulatory processes.

Share information relevant for L&P – what the activity is about, what risks it may create, and who may be impacted. Efficient co-ordination involves sharing information among the different authorities involved in a L&P process. This includes the relevant enforcement and inspection authorities, licensing authorities responsible for closely related fields, and other governmental institutions managing data and information relevant to the L&P system. Institutional agreements or other mechanisms may be needed to establish a data-sharing environment with appropriate communication and collaboration. Information sharing also ensures that regulated subjects are not required to provide the same information twice and that there is awareness of (and access to) the information already released by a public authority – from information on the type of activity, number of workers, types of products used, location etc. to information on risks, compliance and measures to mitigate risks. All data sharing initiatives obviously need to consider the relevant data protection rules.

Follow a life event1 approach to consider the full experience of individuals and businesses. Efficiency in co-ordination between licensing authorities may be improved by their collective adoption of a life event approach. This approach considers government operations from the perspective of everyday life for regulated subjects. An example would be mapping the “journey” of individuals and businesses as they try to reach a certain objective such as opening a restaurant or building a house. In L&P terms, this approach helps illustrate the different L&P procedures, measures, and information obligations required for an individual or business to achieve the intended goal (e.g. zoning permits, environmental assessments to secure beginning of operations). The life event exercise entails that all relevant authorities collaborate — based on a whole-of-government approach — to map the journey. Because it examines L&P from the point of view of the regulated subject, the life event can improve the user experience by requiring that the relevant authorities collaborate in their use of the same vocabulary. It can also highlight the duplication of information requests made during the L&P process while revealing any informational or process gaps. In summary, the life event approach can help address the existing complexity and burden of L&P, while highlighting new opportunities to clarify, simplify and transform its delivery (including digitally).

5.2. Simplify and standardise L&P to minimise complexity

Use only strictly necessary processes and information obligations. To ensure that burden, complexity and any negative impact on growth is reduced to the minimum possible, L&P-related processes and information obligations should be simplified as much as possible. Simplification should be implemented according to life event approach in which L&P authorities consider the overall “regulatory journey” for individuals and businesses (as described in 5.1 above). Simplification also relies on a risk-based approach. For this, only processes, approvals and information obligations that are strictly necessary to achieve the necessary outcome (e.g. ensuring that a factory is safe by design for workers and the environment and does not explode as soon as commending operations) should apply. Duplications and overlaps should not exist.

Standardise L&P for clarity and efficiency. Processes, formats, language, and communication channels should be simple and standardised across different L&P authorities and levels of government. This will ensure efficient information collection, processing, and decision-making by L&P authorities. It will also support clarity and simplicity for businesses and citizens seeking a license or a permit. L&P authorities should only adopt a differentiated approach when the assessment of risks and objectives suggest that this is the best option. In such cases, differences in any L&P process should be based on risk assessment and evidence.

5.3. Keep L&P flexible and responsive to changing needs

Promote L&P tools and schemes that allow for innovation. To effectively manage unknown risks from innovation, regulations must keep pace with emerging technologies and business models. The OECD Recommendation on Agile Regulatory Governance to Harness Innovation [OECD/LEGAL/0464] provides governments with good practices in this regard. Authorities can adopt tools to test L&P requirements and frameworks in new markets, for example by implementing regulatory sandboxes. These innovative approaches allow businesses and individuals to operate in a controlled environment where they can trial new products, services, or operational models under regulatory conditions. This flexibility enables authorities to gather data, understand risk conditions, and monitor compliance in real-time. As a result, updates can be made to L&P requirements where needed and as supported by empirical evidence. By fostering such a dynamic regulatory framework, authorities can adapt swiftly to market changes, support innovation, and ensure that L&P frameworks remain relevant and effective. This, in turn, will facilitate smoother market entry for new participants.

Streamline procedures for permit amendments where possible. Modifications or incremental improvements to approved projects can prove challenging for businesses, particularly in cases of projects that evolve over time and require regular adjustments. Authorities should perform risk assessments and streamline procedures for low-risk L&P amendments, for example by introducing predefined modification thresholds or conditional approvals. Clear guidance should be provided on when and how permitting requirements may be adjusted after an initial approval was granted without triggering a full re-application process.

Implement adaptive L&P provisions for emergency situations. Emergency situations such as the recent COVID-19 crisis have emphasised the need to ensure that essential services and products can be rapidly deployed when needed most. By implementing expedited licensing processes, temporary permits, and adaptive regulatory frameworks, authorities can swiftly authorise qualified providers to operate under emergency conditions. This flexibility allows for a rapid increase in the availability of critical resources, such as healthcare services, emergency supplies and infrastructure support, while maintaining necessary oversight to ensure safety and compliance (see for example (OECD, 2021[22])). As a result, these adaptive L&P schemes enable relevant authorities to respond more effectively to crises, mitigating impacts and supporting timely recovery efforts.

Note

← 1.  “Life event refers to a change in the circumstances of a user which creates a need to use a public administrative service or services, and that may require co-ordination and integration between different service providers” (OECD, 2024[28]).