By NATARIO McKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net
AN OUTSPOKEN lawyer said yesterday that he was mulling whether to launch a legal challenge to what he called an “illegal” and “unconstitutional” move by the government to extend the Hawksbill Creek Agreement (HCA) for a further six months.
Fred Smith, QC, the Callenders and Co partner, told Tribune Business that he was seeking a court injunction to bring to a “grinding halt” to any further consultation of the HCA and the incentives which had been set to expire this month. A hearing on that application is set for September 5, and the hearing of a judicial review application which seeks to dismiss the government’s Freeport stakeholder consultation process through the Hawksbill Creek Agreement Review Committee (HCARC) is set for September 25.
A Supreme Court judge had declined an earlier application for judicial review on the grounds that such action would be premature prior to the committee presenting its report to the government.
Last month Prime Minister Perry Christie announced the extension of the concessions of the HCA for a further six months - until February 2016 - as the government tries to come to a firm decision on whether to continue, amend or abolish them for the long-term. Among the incentives that were set to expire were a series of exemptions from taxes on real property; personal property; capital gains or capital appreciation; shares, debentures or other securities for companies registered in the Bahamas and having their registered office and principal place of business in the Port area; and exemptions from taxes on earnings in the Port area and outside the Bahamas.
Mr Smith argued that the government’s decision to extend the HCA was “completely illegal”.
“I don’t know on what basis they decided to extend the Hawksbill Creek Agreement,” he said. “The HCA itself requires requires 80 per cent of the licencees to agree to any amendment. How could the government have amended my agreement with the Port Authority, the HCA, without coming to me. No none was consulted about extending it or not for six months. It was a slap in our face. These unilateral decisions by central government about the future of Freeport are a big problem.
“My judicial review is impacting this whole consultation process but I may very well launch another action seeking a declaration that this recent amendment to the Hawksbill Creek Agreement illegal and unconstitutional.”
Mr Christie told Parliament in July that the government was extending the expiring HCA tax incentives as there was still “a great deal for the government to digest”. The government had commissioned international consulting firm, McKinsey & Co, to conduct a study on the expiring incentives. On March 5, the government appointed a committee comprised of Dr Marcus Bethel, a former Cabinet minister; Sir Baltron Bethel, the Prime Minister’s senior policy advisor; former Central Bank governor James Smith; Kevin Seymour, the Grand Bahama Chamber of Commerce’s president; former MP Maurice Moore; and Grand Bahama-based attorney, Cassietta McIntosh, to lead discussions on Freeport’s expiring investment incentives and long-term future, as well as a produce a report and recommendations.
Mr Christie said last month that there was a need for more time for further consultation and negotiations with stakeholders on Grand Bahama.
Mr Smith said, however, that he was seeking to obtain a court injunction to stop any further consultation and called for the establishment of a new committee, arguing that the consultation process was “fundamentally flawed”.
“I want to bring ti to a grinding halt,” he said. “I want them to appoint a new committee because the process they went through was flawed because they have kept the McKinsey Report secret. You can not set up a whole committee and set up a public public consultation process, the basis of which is a McKinsey Report which they have refused to give to those affected by it. I have right as a tax paying citizen to have my government, who spent my tax dollars paying McKinsey, to give me a copy of it so that i can comment on it as one of the 3,500 licencees in Freeport. I don’t understand what all the secrecy is about.”
He added: “That is why we need a Freedom of Information Act, but more than that we need government in the sunshine. Why did they leave the decision on whether to extend the tax provision or not so late. It shows a general disrespect for the people of Freeport, the economy of Freeport and the opportunities. Freeport remains pregnant with potential. We are always sitting on the brink of success but we keep falling back into recessions because the central government doesn’t understand how businesses are to succeed in Freeport.”
Comments
The_Oracle 8 years, 7 months ago
While I applaud Fred's continuing actions with respect to the H.C.A. History has show it is for naught but Posterity. This Government, nor any prior Government has had any respect for this agreement made by the Governing council of the day. Nor does the Government give any regard to the numerous court Judgments that have ruled against the Government in their repeated arbitrary and nonsensical actions against the benefits contained therein.
Nor will they ever realize the enormous potential of this agreement in the context of the Bahamas today, and in the context of economic development in the face of Trade Agreements and WTO. What a phenomenal waste of the vision as it was, what an incredible blindness to the potential as it is.
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