Process Review

• Application for Liquor Licence
• Application for Outside Seating Accommodation (OSA) of Restaurants
• Licensing Process for Property Development
• Application for Excavation Permit
• Application for Change of Amusement with Prize Licence (AWPL)
• Application for Places of Amusement Licences (PAL)

Licensing Process for Property Development

(With effect from 1 December 2008, applicants can choose to apply for warehouse construction permits through the One Stop Centre (OSC) operated under the Efficiency Unit.  For details of the OSC, please visit the Efficiency Unit’s website.)

In 2010, the construction industry accounted for 146,958 jobs and 20,566 establishments in Hong Kong.  Together with the real estate sector, the industry constitutes an important part of our economy.  It is therefore an on-going initiative of the Government to review and improve the licensing process for property development.

With the concerted effort of various departments, a number of reforms have been implemented over the past few years to reduce the processing time and streamline the procedures for building construction permits of two-storey warehouses. Development and details of the reforms are depicted in the ensuing sections. 

One notable initiative among the reforms is the setup of a One Stop Centre (OSC) under the administration of the Efficient Unit (EU).  With the OSC to receive applications and coordinate joint inspections to minimize the compliance costs of applicants, it now takes 4 procedures and 66 days to obtain building construction permits for two-storey warehouse projects.

The 4 procedures are briefly described here.  Firstly, an applicant can submit relevant applications in batch to the OSC to obtain pre-construction approvals including water connection from the Buildings Department, Water Supplies Department, the Police and Highways Department.  Secondly, after completion of the foundation works, an applicant can request and receive inspection of foundation strata by the Buildings Department.  Thirdly, an applicant can submit notification of project completion and relevant applications in batch to the OSC to obtain related certificates from the Drainage Services Department, Water Supplies Department, Buildings Department, Fire Services Department and Lands Department, as well as electricity and telephone line connection from utilities companies.  Fourthly, the applicant will receive joint and final inspection of relevant licensing authorities coordinated by the OSC.

Reforms over the Years

On 10 September 2008, the World Bank published its “Doing Business 2009” report (Report). For the indicator of 'dealing with construction permits', which tracks the number of government procedures and processing time in building a two-storey warehouse, the ranking of Hong Kong was up from 60th in the preceding year to 20th in that round. This significant improvement was mainly attributable to the effort of a Working Group (WG) established in 2007 to re-engineer and streamline the relevant licensing procedures. The WG comprises the Economic Analysis and Business Facilitation Unit, the Development Bureau and six departments (namely, the Buildings Department, Lands Department, Fire Services Department, Drainage Services Department, Highways Department and Water Supplies Department).

Some of the WG's recommendations which did not require drastic procedural changes were implemented in 2007 to bring immediate benefits to the trade.  As a result, the licensing process was streamlined to reduce the number of procedures by 8 from 23 to 15 and shorten the processing time by 36 days from 155 to 119 for small building projects like a two-storey warehouse.

For other improvement opportunities identified by the WG to further improve the services associated with the application for construction permits, cross-departmental process re-engineering and organisational change were involved before they could be put in place. In early 2008, the EU reconvened the WG to take forward the following reforms - 

a) Setting-up of One Stop Centre

Having reviewed the relevant cross-departmental processes, the WG agreed to set up a OSC for Warehouse Construction Permits under the administration of the EU for receiving all relevant building licence applications addressed to 6 government departments and 2 private utilities (i.e. electricity supply and telephone line connection) and coordinating their joint inspections for two-storey warehouse projects.

Pre-construction

At the pre-construction stage, property developers can now use Form OSC-1 to submit to the OSC in one-go all applications relating to building plans approval and consent for commencement of building works from Buildings Department, technical audit of water supply connection works by Water Supplies Department, and road excavation permit from both the Police and Highways Department.  This new arrangement can simplify the submission process by combining the following 5 procedures as stated in the Report –

• Obtain building plans approval
• Apply and pay for technical audit of water supply connection works
• Apply, pay and receive road excavation work permission from Highways Department
• Notify and obtain approval from traffic police
• Obtain building consent from Buildings Department

When the foundation works are completed, the Buildings Department will conduct site inspection of the foundation strata before the commencement of any other building works.

Post-construction

When the necessary construction works are completed, the developer can now submit the post-construction applications/notificationsunder a covering checklist (Form OSC-2) to the OSC for technical audit from Drainage Services Department, water supply certificates from Water Supplies Department, occupation permit from Buildings Department, certificate of compliance from Lands Department, certificate for fire service installations from Fire Services Department, and connection of electricity and telephone line by the respective utility companies. This one-stop service eliminates the need of the developer to contact individual government departments and private utility companies for reporting completion of works, issuance of certificates and inspections.

Upon receipt of the applications, the OSC will coordinate, according to the information provided in the application form, the relevant authorities to conduct a single joint inspection on one day. This greatly alleviates the effort of developers in receiving inspections and shortens the total processing time.

With the establishment of the OSC,the following 8 procedures as stated in the Report have been replaced by only 2 new procedures (i.e. (i) Submit notification of project completion and relevant applications to OSC and (ii) Receive joint and final inspection of relevant licensing authorities coordinated by OSC) –

• Apply and pay for technical audit of Drainage Services Department
• Notify Water Supplies Department of construction completion and receive transfer inspection and issuance of water supply certificate
• Notify Drainage Services Department of construction completion and receive transfer inspection
• Obtain certificate of completion of buildings works
• Obtain certificate of compliance from Lands Department
• Obtain fire certificate for fire service installation
• Request and obtain electricity connection (CLP Power Hong Kong Limited or Hongkong Electric Company Limited)
• Request and obtain telephone line (e.g. Wharf T&T Limited, Hutchison Global Communications Limited)

Tracking of applications

To facilitate answering enquiry from the applicants, the OSC has established a mechanism to monitor the progress of each application making the whole application process more transparent and convenient to the property developers.

The OSC is a business facilitation measure. The effectiveness of this programme will be reviewed and the related processes will be refined as appropriate for continual improvement.

(b) Concurrent processing of building plan approval and consent for commencement of building works

To support the EU’s OSC, the Buildings Department has formulated new procedures to allow for concurrent applications for building plan approval and consent for commencement of building works for projects fulfilling specified criteria. With effect from 1 December 2008, the Buildings Department accepts concurrent submission of both applications via the OSC or to the Buildings Department direct. In addition, the department will process both applications within 45 days. Compared with the original processing time of 81 days (i.e. 60 days to approve a building plan application and 21 days to grant building consent as shown in the Report), this reform greatly reduces the total processing time by 36 days.

The relevant procedures are detailed in the Practice Notes for Authorized Persons, Registered Structural Engineers and Registered Geotechnical Engineers ADM-19 (previous reference is PNAP 272).

(c) Expedited processing of applications

With better coordination of applications under the OSC, the Water Supplies Department, Fire Services Department and Lands Department have re-engineered their internal procedures and committed to reduce processing time for the following types of applications –

Water Supplies Department

The Water Supplies Department has shortened the processing time of applications for technical audit of water supply connection works from 21 days to 20 days. 

Fire Services Department

The Fire Services Department has shortened the processing time of applications for certificate of fire service installations from 21 days to 19 days for applications submitted via the OSC.

Lands Department

The Lands Department has shortened the processing time of an application for certificate of compliance of a two-storey warehouse to 21 days upon receipt of the application.

Implementation of all the above reforms (including the setting up of the OSC) was completed on 1 December 2008.

On 9 September 2009, the World Bank issued the “Doing Business 2010” report. On the indicator of ‘dealing with construction permits’, Hong Kong rose from 20^th to the first place as a result of the concerted efforts made by the related departments.  Hong Kong’s ranking on this indicator remains unchanged in the “Doing Business 2011” and "Doing Business 2012" reports released on 4 November 2010 and 20 October 2011 respectively.

For continual improvement, the WG has been closely monitoring and reviewing the operational efficiency of the application process. The departments concerned have further reformed the process and streamlined the associated procedures in subsequent years.

Highways Department

On 24 August 2009, the Highways Department launched the Excavation Permit Management System (XPMS), which is a new system to replace the former Utility Management System for processing Excavation Permits through internet. For registered XPMS users, the time required for processing applications for excavation permit has been reduced from 20 days to 5 days. A gazette notice has been published to announce the revised time limit for submission of applications under the XPMS.

Fire Services Department

In December 2009, the Fire Services Department reviewed and streamlined the process of handling applications for certificates of fire service installations.  The Department has further shortened the processing time from 19 days to 18 days with effect from 1 January 2010. Details of the relevant procedures can be referred to the Department’s homepage.

Lands Department

Having reviewed and streamlined the related procedures, the Lands Department has reduced the time for issuing certificates of compliance for two-storey warehouses from 21 days to 20 days since 1 January 2010.

Water Supplies Department

In February 2011, the Water Supplies Department reviewed and further streamlined the process of water supply applications to improve its customer service.  Now, an applicant can submit both his applications for technical audit for water supply connection works and issue of Water Supplies Certificate in one go at the pre-construction stage.

Composite Form for Utilities Application/Notification

To further streamline the procedures for utility applications/notifications at the post-construction stage, the Government and some utility service providers collaborated to launch a composite form in March 2012.  Now an applicant can submit applications for electricity and telecommunication services and notification to Water Supplies Department for completion of plumbing works in one go via the composite form to the OSC.

Since the launch, the scope of the composite form has been extended to include more service providers. Other utility service providers are welcome to participate in the reform measure.

Overall, all related application processes for small scale building projects like a 2-storey warehouse can be completed in 4 procedures and 66 days.

Please click here for an updated Gantt chart of the licensing procedures.