The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

An ex-Grand Bahama Port Authority (GBPA) attorney was “distraught” after the Government’s withholding of a report by its international consultants left him unable to properly contribute to the debate on Freeport’s future.

Carey Leonard, now a Callenders & Co attorney, alleged that he was “cut off” by the chairman of the Government’s Hawksbill Creek Agreement (HCA) Review Committee when he expressed his concerns over the failure to publish the McKinsey report.

Mr Leonard, in a July 24 affidavit, disclosed the prepared statement he attempted to give before the Committee on April 20, slamming the “lack of transparency” that he believes holds the Bahamas back.

In that statement, Mr Leonard pointed out that the McKinsey report was being withheld despite its completion being financed by Bahamian taxpayers.

“It is very doubtful that the McKinsey Report could possibly contain matters that could be a threat to the national security of the Bahamas, so why withhold it?” Mr Leonard’s prepared statement said.

“As a result of the bald denial of the request for the production of the McKinsey report, a proper, well-balanced and informed presentation has been made impossible.

“It does, however, highlight one of the reasons why Grand Bahama and, indeed, the country, does not have more foreign direct investment, for it showcases another example of how far behind the rest of the world, how backward, this country has become.”

Mr Leonard’s prepared statement continued: “Transparency, and the right to transparency, is a way of life in most modern democracies.

“Business is all about a full knowledge of their surroundings, and access to it is something they are automatically entitled to in most modern countries. This country’s lack of transparency does not go unnoticed on the international stage.”

Mr Leonard’s affidavit alleges that Dr Marcus Bethel, the Committee’s chairman, “cut me off part way through” from reading that statement. He then confirmed that the McKinsey report would not be made available.

The Government’s failure to publish that report is central theme to the second Judicial Review action launched by Mr Leonard and his fellow Callenders attorney, Fred Smith, to challenge the consultation process and any recommendations on Freeport’s future that may flow from it.

They are alleging that the consultation process, on which the report by Dr Marcus Bethel’s committee is based, was “fundamentally flawed and a sham” because key documents - especially the McKinsey report - were not released to those it interviewed.

The McKinsey report is seen as especially important because previous statements by Prime Minister Perry Christie suggest it influenced the Hawksbill Creek Agreement Review Committee’s terms of reference, while also playing a vital role in influencing the Government’s thinking on Freeport’s short and long-term future.

Mr Leonard, in response to the committee’s rejection, said he was unable to give them a full presentation simply because he had not seen the facts, statistics and analysis likely contained in the McKinsey report.

“I therefore could not address questions regarding the proposed policy in respect of the Customs regime, the industrial area and the cost of electricity and how to reduce it,” Mr Leonard said in his July 24 affidavit.

“I was also unable to address the issue of the World Trade Organisation (WTO) negotiations that the Bahamas is currently engaged in and, in particular, in which industries we should be negotiating for preference because I lacked any information as to the Government’s proposals, which ought to have been contained in the McKinsey report.”

Mr Leonard alleged that this reduced his appearance before the Hawksbill Creek Agreement Review Committee to one where he was merely “answering historical questions” about Freeport and its development, as opposed to addressing future government policy.

Messrs Leonard and Smith are not the only Freeport stakeholders to question the consultation process. An April 29, 2015, e-mail from Kirk Antoni, partner at the Cafferata & Company law firm, also expressed disquiet with his appearance before Dr Bethel’s committee.

He joined his client, Royal Oasis owner Harcourt Developments, and its local representative, Donald Archer, in appearing before the committee on April 17 this year.

“Unfortunately, the meeting started an hour late and ended early, as members of the committee scurried to the airport to make their flights back to Nassau,” Mr Antoni wrote.

“The only issue that the committee seemed interested in was the re-opening of the road at the Royal Oasis, and whether Harcourt was prepared to sell the Royal Oasis.” The resort, of course, is still closed some eight years after the Irish property developer acquired it just prior to the ‘credit crunch’.

In their Judicial Review, Messrs Smith and Leonard are arguing that it is both “procedurally unfair” and “irrational” for stakeholders not to be given the McKinsey report because they are then unable to make a proper contribution to the deliberations.

And, on this basis, the legal duo are challenging both the Government’s decision to accept the committee’s report, and the committee’s move to submit its report/recommendations, as these actions bring the “flawed consultation” to an end.

They are, if the Supreme Court grants leave to bring Judicial Review proceedings, seeking a temporary Order preventing the Prime Minister and his government from acting on the committee’s recommendations over the expiring tax incentives until the full case is heard.

Messrs Smith and Leonard also want an Order ‘staying’ the Government “decision-making process regarding potential changes to the provisions of the Hawksbill Creek Agreement and the economic and fiscal governance of Freeport”.

They are ultimately seeking Supreme Court Orders that prevent any decisions being made on the basis of the committee’s report; that require the McKinsey report to be made publicly available; and require that a new consultation process be undertaken with Freeport stakeholders.

How the Government proceeds with addressing both the August 4 tax incentives, which have been extended for a further six months, and Freeport’s long-term development and economic environment remain to be seen.

However, Messrs Leonard and Smith have pointed out that the approval of four-fifths (80 per cent) of Grand Bahama Port Authority (GBPA) licensees is required before there can be any amendments to the Hawksbill Creek Agreement.

This is enshrined in clause 3(8) of that Agreement under the 1960 Act.