People disadvantaged in this case
Amsterdam has by far the largest restaurant sector in the Netherlands, with over 3,900 hotels, bars, and restaurants. This sector accounts for 5.5% of Amsterdam’s employment, and is an essential job market for the disadvantaged, including immigrants and the less well educated. The skills learned working in the restaurant market can be invaluable to setting up small and medium enterprises, and such employment can also be a useful gateway to the job market for young people seeking experience.  Current estimates place one in five working people between the ages of 18 and 24 in hotel and restaurant jobs.
Yet, despite the economic value of the hotel and restaurant sector in Amsterdam, the regulations for acquiring a bar, hotel, or restaurant license in the city is prohibitively complicated. An applicant needs to obtain licenses and dispensations from more than 18 different authorities to set up a new business in this sector. These regulations are confusing obstacles to access to city services for aspiring entrepreneurs.  The obstacles are high to the point that it is practically impossible in Amsterdam to open a shop, when you stick to the rules. This causes a number of entrepreneurs to pursue their business in the informal economy. In contrast to other cases, in this case there is severe overregulation. On top of that the rules and regulations are sometimes contradictory, effectively prohibiting access. The rules have an additional excluding effect, in that through their complexity they pose disproportionate obstacles to people with a low socio-economic background.

How the innovation improved access
To simplify and streamline the licensing process, the City of Amsterdam established the “One Stop Shop for Hotel Restaurant Café Licenses” (abbreviated HoReCa1).  Applicants can go to this office to fill out a 20-question application form that will determine which of 40 government documents the applicant needs to open a new business. This “One Stop Shop” also provides one form to apply for the seven local licenses necessary for the City of Amsterdam. By focusing on customer service in reforming the licensing system, Amsterdam has been able to tailor its services to the public’s needs while simultaneously reducing the costs of processing new applications.
The HoReCa1 initiative currently has offices in 14 local boroughs, as well as an functioning do-it-yourself tool online. Civil servants at each of the 14 offices have been trained to handle all 40 permits and licenses, a huge improvement over the local or regional specializations of the previous licensing situation. A demonstration version of the application is available at the initiative’s website at www.amsterdam.nl/horeca.

Obstacles encountered
The great majority of civil servant knowledge has not been formalized, which means there is a disparity between laws and regulations and the actual service provision offered at the city’s offices. By offering an online portal for licensing, Amsterdam’s innovators were able to identify what, precisely, was needed to apply for a hotel or restaurant license in the municipality. While reviewing regulations before digitizing them, project workers could identify contradictions and overlaps in bureaucratic legislation. The process of formalizing e-government is an excellent opportunity for city workers to make application criteria transparent not only to applicants, but also to the civil servants themselves.
Another important obstacle innovators had to overcome was civil servant inertia. Different barrows wanted to work in different ways and held on to their own routines. By investing in the people offering service at these “One Stop Shops” through active knowledge transfer and training, the HoReCa1 project could become their project. It was essential to engage city workers in the project early to confer a sense of ownership of the initiative on its service providers. The need for innovative people willing to put a lot of time and effort into changing the system is a prerequisite.

The results of the innovation
Both the administrative burden and administrative costs have been lowered by approximately €1.506 (about U.S. $2.160) per online application. With a total of more than 3,920 existing bars and restaurants and a changeover rate of about 1/3 each year, the impact is substantial. Since the main local licenses and permits have a duration of 3 years, within the next few years all current entrepreneurs will have the opportunity to use HoReCa1.
The HoReCa1 project is also part of a citywide program to improve access to all city services by simplifying rules and regulations, with the support of all 40 departments within the municipality of Amsterdam. This encourages general acceptance and participation in the program, although many subdivisions still need to be persuaded to participate more actively. The “One Stop Shop” method has now been extended to cover four other sectors: events, construction in public space, building permits, and expatriate affairs (e.g. registration and taxation arranged in advance of arrival). By streamlining city bureaucracy, Amsterdam is working to improve citizen access to licensing services. Reducing red tape is highly interesting for politicians as well, because it is a message well received with the electorate.