The Doing Business Index, created by The World Bank, considers three (3) key factors when assessing a country's competitiveness relative to others listed on the index as it relates to starting a business:

  1.  The cost of starting a business in the country being assessed

  2.  The number of procedures required to start a business in the country being assessed

  3.  The paid-in minimum capital required to start a business in the country being assessed

To make the data comparable across economies, several assumptions about the businesses and the procedures are used when compiling scores.

Assumptions about the business

 

The business:

  • Is a limited liability company (or its legal equivalent). If there is more than one type of limited liability company in the economy, the limited liability form most common among domestic firms is chosen. Information on the most common form is obtained from incorporation lawyers or the statistical office.

  • Operates in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.

  • Performs general industrial or commercial activities, such as the production or sale to the public of goods or services. The business does not perform foreign trade activities and does not handle products subject to a special tax regime, for example, liquor or tobacco. It is not using heavily polluting production processes.

  • Does not qualify for investment incentives or any special benefits.

  • Is 100% domestically owned

  • Has five business owners, none of whom is a legal entity. One business owner holds 30% of the company shares, two owners have 20% of shares each, and two owners have 15% of shares each.

  • Is managed by one local director.

  • Has between 10 and 50 employees one month after the commencement of operations, all of them domestic nationals.

  • Has start-up capital of 10 times income per capita.

  • Has an estimated turnover of at least 100 times income per capita.

  • Leases the commercial plant or offices and is not a proprietor of real estate.

  • Has an annual lease for the office space equivalent to one income per capita.

  • Is in an office space of approximately 929 square meters (10,000 square feet).

  • Has a company deed that is 10 pages long.

 

The owners:

  • Have reached the legal age of majority and are capable of making decisions as an adult. If there is no legal age of majority, they are assumed to be 30 years old.

  • Are sane, competent, in good health and have no criminal record.

  • Are married, the marriage is monogamous and registered with the authorities.

  • Where the answer differs according to the legal system applicable to the woman or man in question (as may be the case in economies where there is legal plurality), the answer used will be the one that applies to the majority of the population.