The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Democratic National Alliance (DNA) yesterday urged the Government to go beyond the "semantics" of whether The Bahamas was "blacklisted" in the targeting of its economic permanent residency regime.

Arinthia Komolafe, pictured, the party's deputy leader, said The Bahamas' inclusion in a list of 21 countries whose residency/citizenship regimes were considered potentially harmful to the "integrity" of the Organisation for Economic Co-operation and Development's (OECD) automatic tax information exchange efforts was neither "positive, complimentary or favourable".

She called on the Minnis administration to follow Monaco's lead and take action to remove The Bahamas from the OECD list, given that the principality secured its delisting by showing its residency and immigration regimes will not affect the Common Reporting Standard (CRS).

"We submit that this is another classic case of the moving of the proverbial goal posts by international organisations," Mrs Komolafe said in a statement. "The Government must now move beyond the semantics and address this issue for what it really is.

"The reality is that only 21 out of over 100 countries were placed on this list for high risk citizenship by investment/residency by investment schemes. While the use of the word ''blacklist' may be inappropriate or frowned upon, the list is not a positive, complimentary or favourable one."

The OECD listing threatens to negatively impact a wide cross-section of the Bahamian economy, and not just the hard-pressed financial services industry. Besides attracting high net worth clients and their assets to this nation, economic permanent residency drives lucrative business for real estate developers, realtors and attorneys, and produces spin-offs affecting virtually all industries.

While the OECD's list, and accompanying report, did not mention the imposition of sanctions or penalties against The Bahamas and 20 other countries, it did call on financial institutions to apply greater scrutiny to persons benefiting from their investment-related residency and citizenship programmes when it came to determining their tax compliance.

This enhanced due diligence, and likely extra costs and time involved, could deter wealthy investors and homeowners from applying for Bahamian permanent economic residence - thereby undermining a key component of the foreign direct investment (FDI) regime that has been in place for decades.

"This equates potentially to additional scrutiny and enhanced due diligence on legitimate economic permanent residents of The Bahamas," Mrs Komolafe added.

"We note that since the release of the guidance, the OECD has issued a statement in which it was asserted that Monaco's residence and immigration requirements do not pose risks to the integrity of the CRS. This followed the provision of additional information by Monaco and it is expected that the guidance/list will be updated to reflect this."

The DNA deputy leader continued: "The Government has an obligation to ensure that the OECD is made aware of the robust and rigorous process in place for the granting and maintenance of economic permanent residence by individuals [in The Bahamas]. This includes a comprehensive due diligence and vetting process to ensure the fitness and propriety of all applicants.

"The economic permanent resident programme and second home market are well regulated and pivotal to our economy. It impacts the real estate, financial services, tourism and government sectors with contributions to our nation's Gross Domestic Product.

"We need effective representation and diplomatic collaboration to address this latest attack on our nation's economy. It is simply unfair and unacceptable for the OECD to place The Bahamas on any adverse list despite our demonstrated commitment to meeting our international obligations."