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Various Decrees Affecting Tourism:

Various Decrees Affecting Tourism: Tightening Up of Licensing Requirements but an Additional Bureaucratic Burden
During the month of November 2008, the Minister of Tourism issued eight decrees (Numbers 176 and 199 published in the Egyptian Gazette on November 6th, 2008, Numbers 245, 250 and 267 published on November 8th, Number 478 published on November 11th, and Number 30 of 2006 and 262 of 2006, published on November 12th, 2008) all affecting various aspects of conducting the business of providing tourist services.
The following is an amalgamation of the key provisions stated in those Decrees:
• Tourist busses must now be fitted with a speedometer • Diving centers may not be operated without a license from the Ministry of Tourism • «Take Away» shops, i.e. shops selling food and beverage ages for consumption outside of location are considered tourist establishments and may not be operated without license from the Ministry of Tourism • Centers providing entertainment relating to water games and sports, boating for purposes of surfing, snorkeling, amateur fishing, glass boat and submarine trips are considered tourist activities and may not operate or provide their services without a val- id license issued by the Ministry of Tourism. The license requires specific facilities, qualifications and expertise and puts an end to irregular or informal services in this domain • No new diving centers are to be licensed in Sharm El-Sheikh, Dahab, Hurghada or Safaga. The only exceptions are with respect to diving centers in newly established hotels, and centers which replace previously existing ones in hotels which had stopped operating • No hotel or tourist establishment is allowed to operate a «health center» except after obtaining a license from the Ministry of Tourism
Conclusion
There is no doubt that a tightening up of the licensing requirements for tourist services was needed, and that this should have an impact on the protection of the environment, the safety of tourists and others, and the provision of higher standard services. These are the reasons why licensing takes place, and there is no reason to assume otherwise in this case. Moreover, forcing tourist establishments to gradually join the formal sector instead of continuing to operate in the realm of informality is also welcome.
There is, however, a number of elements in the new regulations which cause concern:
1. The sheer number of decrees and their amendments - eight - issued in the span of one week is not a smooth and transparent method of legislation. What this indicates is that a larger overhaul of the regulatory frame work for tourist services is required, but that a piecemeal approach continues to be adopted. 2. More interesting is the fact that of the eight decrees published this month, two were issued in 2006 but only published last week. The unfortunate feature of this is that both decrees must have been already applied by the Ministry of Tourism throughout those two years with- out the public getting the opportunity of seeing them officially published. By publishing them now, the Minister of Tourism is probably attempting to clear the backlog of unpublished decrees, which is the right thing to do, even if with such a delay. Other ministers should follow suit and attempt to ensure that the rules that were issued at some point are all published. 3. On a more substantive note, the new rules raise an additional concern of a different nature. Egyptian bureaucracy typically reacts to the lack of regulation in any field by an excessive intervention that takes the form of licenses, requirements, paper work, and too many cumbersome conditions and procedures. The nature of regulation revealed by the latest decrees from the Ministry of Tourism follows this pattern, with excessive bureaucratic requirements and too much discretionary powers to the Ministry officials. Moreover, by forbidding the issuing of new diving centers licenses in the four key diving cities in Egypt, the new rules will reduce competition, and immediately provide a premium for the current licenses even if they are below standard. A more prefer- able approach is to raise the requirements sufficiently to drive out the less able centers and continue to encourage new entrants who are capable of providing a better service.
During the month of November 2008, the Minister of Tourism issued eight decrees (Numbers 176 and 199 published in the Egyptian Gazette on November 6th, 2008, Numbers 245, 250 and 267 published on November 8th, Number 478 published on November 11th, and Number 30 of 2006 and 262 of 2006, published on November 12th, 2008) all affecting various aspects of conducting the business of providing tourist services.
The following is an amalgamation of the key provisions stated in those Decrees:
• Tourist busses must now be fitted with a speedometer • Diving centers may not be operated without a license from the Ministry of Tourism • «Take Away» shops, i.e. shops selling food and beverage ages for consumption outside of location are considered tourist establishments and may not be operated without license from the Ministry of Tourism • Centers providing entertainment relating to water games and sports, boating for purposes of surfing, snorkeling, amateur fishing, glass boat and submarine trips are considered tourist activities and may not operate or provide their services without a val- id license issued by the Ministry of Tourism. The license requires specific facilities, qualifications and expertise and puts an end to irregular or informal services in this domain • No new diving centers are to be licensed in Sharm El-Sheikh, Dahab, Hurghada or Safaga. The only exceptions are with respect to diving centers in newly established hotels, and centers which replace previously existing ones in hotels which had stopped operating • No hotel or tourist establishment is allowed to operate a «health center» except after obtaining a license from the Ministry of Tourism
Conclusion
There is no doubt that a tightening up of the licensing requirements for tourist services was needed, and that this should have an impact on the protection of the environment, the safety of tourists and others, and the provision of higher standard services. These are the reasons why licensing takes place, and there is no reason to assume otherwise in this case. Moreover, forcing tourist establishments to gradually join the formal sector instead of continuing to operate in the realm of informality is also welcome.
There is, however, a number of elements in the new regulations which cause concern:
1. The sheer number of decrees and their amendments - eight - issued in the span of one week is not a smooth and transparent method of legislation. What this indicates is that a larger overhaul of the regulatory frame work for tourist services is required, but that a piecemeal approach continues to be adopted. 2. More interesting is the fact that of the eight decrees published this month, two were issued in 2006 but only published last week. The unfortunate feature of this is that both decrees must have been already applied by the Ministry of Tourism throughout those two years with- out the public getting the opportunity of seeing them officially published. By publishing them now, the Minister of Tourism is probably attempting to clear the backlog of unpublished decrees, which is the right thing to do, even if with such a delay. Other ministers should follow suit and attempt to ensure that the rules that were issued at some point are all published. 3. On a more substantive note, the new rules raise an additional concern of a different nature. Egyptian bureaucracy typically reacts to the lack of regulation in any field by an excessive intervention that takes the form of licenses, requirements, paper work, and too many cumbersome conditions and procedures. The nature of regulation revealed by the latest decrees from the Ministry of Tourism follows this pattern, with excessive bureaucratic requirements and too much discretionary powers to the Ministry officials. Moreover, by forbidding the issuing of new diving centers licenses in the four key diving cities in Egypt, the new rules will reduce competition, and immediately provide a premium for the current licenses even if they are below standard. A more prefer- able approach is to raise the requirements sufficiently to drive out the less able centers and continue to encourage new entrants who are capable of providing a better service.