If one would have desired to start a business, it would have been difficult a decade ago. However various improvements in starting a business have been put in place as the years of various CEE countries in EU increased. Currently there has been a great improvement of business environment in the CEE countries majorly because of the political stability of the region and favorable conditions that encourage investments to take place. The easiness of starting up business is the first step of investing into a business. During the previous year's startups across the CEE region have been able to raise E3.01 billion that was achieved in London while comparing the purchasing power, it is seen that London turns out to be almost thrice as expensive as CEE thus making startups of CEE to outperform these in London with regards to raising funds by roughly a billions euro raised, that is -0.95 billion euros to be exact. Supposing one is at early stage pre-revenue startup of thrice that is based in the CEE region, even after including rent, operating costs and your team it will cost you three times less than being in London doing the same thing. If one raises a pre-seed round of about 100k one can run for only five months in London as compared to the same amount but operating in over 12 months within the CEE region. The eco system of starting up a business in the CEE is improving by the day. Various governments in the CEE region are work fast in order to improve their startup ecosystem. The Czech Republic is an example as it offers direct investments to new companies that already have a traction. The investment they offer is up to 13 million Euros. All their favorable factors and policies have led to an increase in the development of business within the CEE region. (Diana Lace 2018, no pp)
In setting up a business, there are various things that need to be considered. They incorporate the time required to begin a business, the time required to enroll property, the time required to authorize an agreement, procedures required to begin a business, methodology required to enlist property, strategies required to assemble a warehouse and the time required to build a stockroom. These factors are to be considered while venturing into a business depending on the scope of the markets. These requirements fit the large scope of the market, thus the fewer the time and the procedures involved, the easier it is to start an investment.\\\\ which leads to eventual growth of the business. The economic convergence offered by the EU correlates with the growth of the business environment in CEE. These convergence has enabled CEE countries develop over the years with Romania having a significant cluster of firms in areas of low productivity. Due to the role of the EU as a major economic and trade partner of CEE, CEE have used 'old' EU as its benchmark. In as much as the CEE countries improved after joining the EU improvement was seen after the post crisis period. (Boris Vujcic pp 1-12). It takes a much shorter time to start a business Hungary than in the four countries in question. It is also faster to start a business in Romania as compared to Bulgaria in terms of the time spent in starting up a business. With regards to procedures, Poland has the least procedures involved in starting up a business, followed by Hungary and Romania, then Bulgaria and lastly Romania.
Contract Enforcement
In order for a business environment to thrive, there is need for contract enforcements such that properties or shares of stakeholders are very secure. Most of the investors who are confident about the security of their property or contracts, reinvest between the rate of 14 and 40% and gain more profits as compared to those who are not comfortable with the security of their properties or shares and whether there are favorable rules to enforce in case of a conflict with regards to such matters. Disregard or delay in enforcing rules that are meant to protect the property or shares of investors reduce the rate of investments as they erode the value of property. Although there has been an improvement in the CEE region with regard to the business environment, some of the countries in the region such as Poland have a less than the expected legal performance and unpredictable changes in the policy making and the enforcement of contracts. This makes their business environment weaker as many investors shy away from such uncertainties. The MOJ has requested for the assistance of World Bank in analyzing the enforcement of contracts and in developing better policies that have been recommended. These policies are to be employed in commercial courts. The performance of the commercial courts is very vital and is measured by the responsiveness of the court to settle a dispute. In Poland, it is discovered that the courts dispose cases very fast. The courts must deliver resolutions on commercial disputes. Failure to this makes many investors go at a loss or shy away from investing or reinvesting in a particular country. In Poland, the legal system is in a hurry of producing legislative drafts without them considering the effect the laws may have among stakeholders and the policies that the laws ought to implement.
Information is a very vital component that increases access to court services. Various governments have established a database containing information about laws, legal documents and even details about some cases that people can access, although this has not been fully implemented in the CEE region. The Polish courts have no obligation to provide this information. By 2010, at least 12 European countries, including Hungary provided this information to people without them being obliged to do so by the law. Other countries such as Romania are also considering the same action and have ongoing reforms that will accomplish this desire. If these reforms are implemented, they will boost the effectiveness of the courts and thus boosting the confidence of the users which will increase the rate of investment due to assurance of secure properties, thus increasing the rate of productivity if the business environment of the CEE countries. (World Bank Group 2012 pp 1-46). Romania has the shortest time taken to enforce a contract, followed by Bulgaria, then Hungary, then Czech Republic and lastly Poland. As seen, other CEE countries have better contract enforcement policies than Poland but are not quite there yet. There is still room for improvement.
Property Rights
Property rights is another important is another important aspect that influences the investment in a particular country. The Turkish law on industrial property has been adopted by the European Union legislation. The law was published and implemented on January 10, 2017. The main aim of the law is to protect intellectual property rights. Before the law was adopted, intellectual property rights were regulated by separate statutory laws on patents, trademarks, geographical designs and industrial designs. In as much as the previous laws were designed to go in line with and help accomplish the goals that were coming up from the EU-Turkey customs union, there are various aspect that were in contrary with the Turkish constitutions such as issues relating to limitations of fundamental rights. The laws was designed and implemented so as to fill in the gaps that were created in the industrial property rights. The courts ruled that the law be made and it was drafted just as the court had order, which was also in line with the law and practice of the EU with regards to the geographical indications, patents, utility models, designs and trademarks. The change in the law made these principles to be used not only in Turkey but also in very many places worldwide. The existed prohibition of the coexistence of trademarks were not tolerated under whichever circumstances. The law was changed thus allowing the coexistence of trademarks which explicitly accepts consents from the initial owner of the trademark. Only in this incidence can a coexistence of trademarks exist. The law also regulates the protecting of the un-registered trademark thus trademark owners that are un-registered can also reject application of any similar goods and services submitted for identical trademarks. The law also protects registered trademarks and if a risk may occur that leads to the dilution of the distinctive character or take advantage of a reputation of a well-known trademark, the application will be rejected. The law also protects trademarks by rejecting applicants for a resembling registered trademark. All these laws are enforced in the CEE countries that are members if the EU giving them a great advantage due to great property right. The law ensures that packages are protected by geographical indications so as to make the consumer more aware of the product. With regards to changes on designs, the law guards designs if they meet the conditions of visibility, distinctiveness and innovation. Other designs cannot be registered. The law has also put in place an examination system in order to protect legitimate owners of patent applications from third parties.
Property rights are very vital especially in the economic world as they either encourage or discourage investors. The principle the EU follows in providing property rights is very helpful as it really protects the investors in almost all aspects, thus making CEE a great place to invest in. this in turn leads to the growth of the business environment of CEE. The guarding of trademarks helps investors to safeguard their property without them being taken advantage of by the environment or malicious people. The patent ownership is very vital as it helps in safeguard the rights of an investor to a particular product thus enabling a fare environment for the investor without any fear of his or her rights being taken away from him or her. All these factors favor investment and have led to the development of the business environment of CEE.
