Trade and Commercial Law Assessment - Honduras - Economic ...

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TRADE AND COMMERCIAL LAW ASSESSMENT DECEMBER 2004 HONDURAS a. ♦ Corruption is said to have decreased at Immigration. Payments for immigration services are now made directly to banks, which have eliminated opportunities for corruption. ♦ The Immigration Agency seeks to better facilitate trade by training and deploying more English speakers. ♦ Honduras is implementing a biometric identification system for visitors. However, this was not in use at any of the border crossings, airports, or seaports the assessment covered and is therefore difficult to assess. The system may have the potential to streamline the entry process and secure the border. Honduras can further support trade facilitation through the following measures: ♦ Like other public agencies, Immigration suffers from a lack of a professionalized service attributable to politicization of the bureaucracy. This situation leads to corruption and delays, which seriously hamper immediate at-the-border trade facilitation and impact Honduras’s attractiveness for FDI. As with other agencies, it is critical to provide civil service reform that creates an agency that is intelligently recruited, well trained, and honest. ♦ Although measures such as mandatory bank payments strengthen integrity, the result of such a system is an added step to the process. Creating a transparent, professional, and trusted institution is critical. Honduras should seek to make the public agencies part of a strong civil service with as little political influence as possible. Key functions, including recruiting, hiring, retention, training, integrity, and automation, should all be part of this effort. ♦ Although Immigration does have computers at the borders, it lacks modern systems for using the computers. The border posts are not linked to headquarters via e-mail or intranet. Further, no border crossings have technology capable of reading passports. ♦ Immigration Issues to Address At border exits, Honduras (and other Central American countries) requires citizens and visitors to check out of the country. This adds another unnecessary step to the people flow process. Strong entry controls, risk management, and proper enforcement should allow governments to reallocate resources and remove the requirement for checking all those who exit. ♦ At airport exits, Honduras collects three fees from three different windows from exiting travelers. Although the overall fee is not that significant ($29), it is a cumbersome bureaucratic process and a poor use of resources (three collectors where one or none would do). The most efficient and transparent system would involve collections by the airlines with electronic disbursements to the appropriate agencies. ♦ With respect to illegal immigration, Honduras’s institutions are improving, but they are still inadequate for safeguarding the country’s borders. Immigration officers need further training in identifying false documentation, including training in investigations and procedures. XII-3
TRADE AND COMMERCIAL LAW ASSESSMENT DECEMBER 2004 HONDURAS ♦ Like other Central American countries, Honduras has a cumbersome system for processing those seeking longer trade-related stays. International visitors who seek an extended stay and a work permit would benefit from a new facilitated process. The Immigration Agency is perceived to be responsive to inquiries, the fees are reasonable, and the most recent law is viewed as an improvement. However, the documentary requirements are complex (involving more than 12 pieces of paperwork and five or more government agencies) and are not seen as fairly and transparently executed. Processing times vary greatly and can extend to months because of bureaucratic hassles and multiple visits to the Immigration Agency. Moreover, additional steps can be added by the Immigration Agency without notice and without regulatory basis. Honduras should implement a system that is predictable, transparent, and timely. D. SUPPORTING INSTITUTIONS In Honduras, as in other Central American countries, the Immigration Agency administers the laws, while the police execute law enforcement functions, such as detentions and arrests. The police force is considered by some to be a constructive partner, but others consider Immigration, the National Police, and Customs to all be part of a corrupt and inefficient system. The Honduran Institute for Tourism is a strong partner in trade-related people flows. The organization receives significant support from the government. It has a focused mission and is well organized. The legal profession provides support to the trade community by acting as an intermediary in transac tions between trade-related people seeking longer stays in Honduras (i.e., a plant manager at a free zone in San Pedro Sula). Unfortunately, in Honduras, numerous interviewees identified poor legal assistance. Although good quality attorneys do exist and provide service to traders, there is a segment of the Honduran law profession that has a reputation for providing poor and inadequate service, in some cases resulting in paying clients’ being charged for services never rendered or poorly performed. Infrastructure and services regarding people flows, as described later in this report, are adequate. Honduras has two major international airports in Tegucigalpa and San Pedro Sula, where there are daily direct flights from many cities in the region, and North and South America. Intraregional road travel along the Pan-American Highway is adequate because of decent infrastructure. E. SOCIAL DYNAMICS Trade-related people flows receive little consistent support in Honduras. There is some support in the business community for a more efficient immigration processing system for business travelers seeking longer stays, but people flows, particularly in the form of tourism, are widely supported and encouraged at all levels, executive branch, legislature, private institution, and genera l public. XII-4
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