By NEIL HARTNELL
Tribune Business Editor
The Government will "table shortly" international arbitration centre legislation aimed at helping The Bahamas become the investor's "jurisdiction of choice".
Brent Symonette, minister of financial services, trade and industry and Immigration, told a Miami conference on "Business Opportunities in the Caribbean" that the Minnis administration plans to move ahead with an initiative that has been talked about for 10-15 years.
He said the International Commercial Arbitration Bill 2018 will facilitate commercial dispute resolution hearings in The Bahamas by incorporating United Nations model law known as UNCITRAL into its provisions - something he had promised at January's RoyalFidelity Economic Outlook conference.
Mr Symonette added that the Ministry of Financial Services also planned to conduct a survey of international arbitration users and practitioners to determine whether there would be sufficient demand for the Bahamas if it positioned itself as a dispute resolution hub.
"The International Commercial Arbitration Bill 2018 will be tabled shortly, and seeks to make provision for the procedure for the conduct of international commercial arbitration hearings in the Bahamas, incorporating the provisions of the International Commercial Arbitration Model Law of the United Nations Commission on International Trade Law (the UNCITRAL Model Law)," Mr Symonette.
"The Ministry of Financial Services will shortly be conducting a survey.... to obtain feedback from the users of international arbitration services and practitioners to determine how companies and their clients decide on which international arbitration services to use; and whether consideration might be given to using the Bahamas as a seat for international commercial arbitration matters."
Besides generating work for Bahamian attorneys and trained arbitration professionals, Mr Symonette said the Government's ambitions would also complement and enhance other key industries - financial services, the maritime sector and Bahamian shipping registry, foreign direct investment (FDI) and other international business-related initiatives.
"It will also help to build investor confidence in the Bahamas as a jurisdiction of choice, which can rapidly and affordably resolve disputes," the Minister added.
The ability to resolve commercial disputes in a timely, cost-effective manner is a key factor in determining where mobile international businesses and capital decide to locate. Establishing a properly-functioning international arbitration centre in the Bahamas would thus enhance this nation's competitiveness and attraction, given that investors would have an efficient, private resolution mechanism that avoids going through the courts.
Companies throughout the world are increasingly inserting arbitration/alternative dispute resolution (ADR) clauses in commercial contracts in a bid to resolve disputes without resorting to expensive, time-consuming legislation.
The Bahamas' international arbitration centre proposal thus seeks to capitalise on such trends, although the country is making its move relatively late - the idea having first surfaced some 10-15 years ago. The last Ingraham administration, of which Mr Symonette was a member, updated the Arbitration Act in 2009, but successive governments have to-date failed to build on this.
Serving notice of the Government's ambitions, the Minister said: "It is our intent to establish the Bahamas as a modern and sophisticated international commercial arbitration centre.
"We believe that given our developed financial services sector and large ship registry, there are opportunities which can allow such matters to be arbitrated in the Bahamas, creating the potential for long-term employment opportunities for Bahamian professionals with trickle down effects for the economy at large."
Mr Symonette added that the Bahamas also plans to codify the FDI approval process by introducing a Foreign Investment Bill, a move that is linked to the Government's plans for this nation to become a full World Trade Organisation (WTO) member by end-2019.
"We will next move to bring greater transparency to the process involved in the approval of foreign direct investments by codifying the process through the Foreign Investment Bill," he confirmed.
Rules-based trading regimes such as the WTO require member states to set out 'the rules of the game' in statute law, rather than policy, to ensure they cannot be changed arbitrarily and that all parties understand what is expected of them.
Much of the Bahamas' investment-related rules are currently set out in policy, which will have to be upgraded to statute law before the WTO accession. Mr Symonette, outlining the Government's rationale for seeking full WTO membership, said it would boost this nation's ability to attract FDI and foreign capital.
"As international investors, many of you will look at a country's membership in the rules-based system of the WTO to evaluate the risk of doing business with and in those countries," he told the Miami conference.
"Membership in the WTO will give you, as investors, the guarantees that your investments will be protected by the rules that govern international trade. We believe that membership can only strengthen the Bahamas' competitiveness for international capital."
Mr Symonette acknowledged that WTO membership will pose both "opportunities and challenges", but said research showed it was in the Bahamas' "medium and long-term interest". He added that the country could no longer afford to "remain on the outside looking in" when decisions affecting its economic growth and development were being made.
"The Government also believes that membership will improve our global competitiveness, as we apply ourselves to global standards of trade, and aggressively pursue international partnerships that work to increase innovation and development," the Minister said.
"Moreover, membership will better protect our trade by seizing upon the protections and safeguards of the rules-based system that the WTO offers, while improving our access to global markets for Bahamian products and services through progressive bilateral arrangements within the WTO."
Mr Symonette said regulations to give effect to the 2015 intellectual property legislation were now being "finalised", and added: "The enactment of Intellectual Property legislation gives foreign direct investors the confidence to know that their investment in their intellectual property rights will be protected according to the highest international standards.
"Moreover, we believe that the creation of an environment to support innovation is more likely to exist in an environment of sound intellectual property rights protection.
"The Bahamas' membership in the WTO would not only encourage the development of our own intellectual property rights regulation, but would also strengthen confidence in our country as a jurisdiction for pursuing innovation."