18 July 2018

Rwanda: Most Restaurants, Bars and Nightclubs Operate Without Licenses - Regulator

A majority of bars, restaurants and nightclubs in the country are operating without necessary license required by the sector regulator, the Rwanda Development Board.

Statistics from RDB show that most bars, restaurants and nightclubs have so far failed to meet standards set by the regulator.

All hospitality and tourism businesses in the country are required to be licensed and graded under different categories.

The categories include accommodation establishments; restaurants, bars and nightclubs; tour operators, guides and travel agents; tourism information centres; and cultural tourism facilities.

This is in compliance with the 2014 tourism law, which was passed by cabinet in October 2016.

While most big and medium hotels within the accommodation category have responded positively to the requirement, restaurants, bars and nightclubs have been found falling short.

As of June this year the number of licensed operators in the country had increased to 212 from 67 in October last year, RDB statistics show.

RDB had initially projected to have licensed over 500 establishments by June this year.

A spot check by The New Times in the course of the last week, which involved a number of city bars, revealed that most are yet to go through the process.

This included popular and high end bars.

On inquiry from managers and owners, some claimed to be ignorant of the requirement saying no formal communication had been made to them.

Others cited unending bureaucracies in the process.

RDB Head of Communications and Marketing, Sunny Ntayombya, told The New Times that different categories of tourism entities have responded differently to the rules.

"The big and medium hotels within the accommodation category have responded positively. The tour guides have also taken a big step toward complying with the law compared to other tourism entities within the same category like tour companies and travel agencies.

"The restaurant, bar and night club category has been the slowest in responding to the compliance," he said.

"Most entities have been used to operating without licensing procedures and it is taking long for them to understand the requirements provided under the law," he said.

Among the most contentious elements in the licensing process is occupation permits, which are issued by district authorities and the City of Kigali.

RDB said that all entities were supposed to have applied and obtained an operating license by June 2018.

Considering that a significant number of establishments are yet to comply, Ntayombya said that RDB is currently in the process of formulating other law enforcement mechanisms for entities to comply.

"The measures may even entail to request operators to temporarily stop their business activities until they comply with the law," he said.

Francine Havugimana, an operator in the local hospitality sector (Impala), told The New Times that the licensing is not a onetime event but a process over time.

She noted that, over time, establishments will fully comply.

Nsengi Barakabuye, the Chairperson of the Hoteliers association, told this paper that operators are ready to go through the licensing process.

"We have had several meetings with members to create awareness and discuss areas where players require assistance to complete the process," he said.

He, however, noted that some requirements were somewhat challenging for players such as acquiring occupation permits.

A majority of restaurants, bars and nightclubs do not own the buildings they operate from which shifts the responsibility of acquiring an occupation permit to the owner.

The process also involves grading hospitality establishments by stars category to drive facilities to continuously improve in terms of quality as they are reviewed every two years with possibilities of upgrading or downgrading.

Last year's grading exercise showed that Rwanda has three five-star, seven four-star hotels and at least 19 hotels in the three-star category. 18 fell into the two-star category.

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