By NEIL HARTNELL
Tribune Business Editor
CARICOM’s founding treaty could provide the basis for a Bahamas-based regional arbitration centre, bringing the local economy “full circle” by supporting financial services, trade and industry.
Ryan Pinder, minister of financial services, told Tribune Business that the revised Treaty of Chaguaramas’s provisions for a Caribbean commercial arbitration hub had left the Bahamas’ ambitions in this area in “a good place”.
Hinting that the Bahamas could offer itself as just such a ‘hub’, Mr Pinder said the creation of a regional arbitration facility would also remove a significant trade barrier for Bahamian firms by reducing concerns over cross-border commercial disputes.
He disclosed to Tribune Business that the Government was seeking to “immediately” contract Professor Jan Paulsson, described as one of the ‘founding fathers of commercial arbitration’, and faculty chair at the University of Miami Law School’s International Arbitration Unit, to develop the “framework” for a Bahamian centre.
While emphasising that it was “a marathon, not a sprint”, Mr Pinder said he hoped that an internationally-recognised arbitration centre would be established in the Bahamas before the Christie administration’s current term in office ends.
“A good place for the Bahamas to be involved is the revised Treaty of Chaguaramas, which speaks to arbitration between members and to the development of a commercial hub for arbitration in the region,” the Minister said.
“On the trade side, we’ve seen tremendous interest by local businesses in reaching regional markets and accessing regional markets, and as we encourage and develop that, having effective dispute resolution reciprocity is important.
“If there’s a regional arbitration hub, where there are standards, efficiencies and effectiveness, that will facilitate regional trade as the fear of dispute resolution will not be a bar to regional trade,” Mr Pinder added.
“If we encourage industry to look beyond our borders, it will facilitate regional trade. It [arbitration] not only provides a support base for trade, financial services and maritime, but supports industry. It’s another product offering for the services side.”
Mr Pinder cited the case of a Bahamian manufacturer of soaps and oils, looking to expand into Caribbean markets, which would be greatly assisted by a regional arbitration hub that ensured speedy, cheaper and just resolution of commercial disputes.
Arbitration, and other alternative dispute resolution (ADR) methods, are widely viewed in commercial and legal circles as cheaper and quicker than the courts in resolving complex matters. The parties have access to specialists in the necessary field, while they also benefit from the extra confidentiality provided by not going through the court system.
Besides capitalising on its existing industries to launch a Bahamian commercial arbitration hub, this nation can offer significant professional expertise via its professional services workers - attorneys, accountants and other experts in their field. The Bahamas’ branch of the Institute of Chartered Arbitrators has also grown rapidly, as it seeks to build the necessary intellectual capacity.
With the Government committed, Mr Pinder said ‘buy-in’ to the arbitration centre concept by all stakeholders - the likes of the Judiciary, financial services professionals, attorneys, accountants and the latter three’s clients - was critical to making it a reality.
He emphasised that Bahamian judges needed to be “comfortable deferring to arbitration”, and added that he wanted the judiciary to “advocate for it”. The Bahamas Bar Association has already given its “complete endorsement”, having formed an arbitration committee.
“Arbitration, although not a new concept, has not been prevalent from an industry viewpoint,” Mr Pinder said of the Bahamian financial services industry. “As we develop and see a shift in our industry to Latin American clientele, the relevance of arbitration, and its confidentiality and expense, is extremely important.”
He added that “rather than create two standalone offerings”, the Bahamas needed to build arbitration into its financial services product menu, each complementing the other.
Educating Bahamian professionals and their clients on arbitration’s merits was thus key, the Minister added, if the Bahamas was to develop a commercially viable market in this niche.
“We’ve made considerable progress from starting from ground zero,” Mr Pinder told Tribune Business. “We need to make sure we have the framework, and are looking to engage one of the top international arbitration professors, Jan Paulsson of the University of Miami, to help firm up the structure and increase its importance in the industry.”
He added that the Government was working with the College of the Bahamas (COB) and the Eugene Dupuch Law School, plus the Bahamas Institute of Chartered Accountants (BICA), to develop “pilot” arbitration courses.
“What we want to do is develop that into a certification programme, to have a series of courses in Alternative Dispute Resolution (ADR),” Mr Pinder said. “Develop a certification programme that supports the education of professionals.”
He added that a fully-functioning Bahamian commercial arbitration hub would provide more and new work for the likes of attorneys and accountants, but warned that “structure, capacity and acceptance” were critical.
“We need all that before we go out to the international market,” Mr Pinder told Tribune Business. “It’s not a sprint, it’s a marathon to develop a successful arbitration centre. All these components are important, and without one it might collapse.”