The Tribune

By NEIL HARTNELL Tribune Business Editor THE Grand Bahama Chamber of Commerce's newly-elected president yesterday called for the ongoing controversy surrounding Freeport's 'bonded goods' regime to be "resolved once and for all", as licensee complaints over alleged arbitrary Customs actions began to mount once again. John Swain, who is also an accountant and partner in Deloitte & Touche (Bahamas), told Tribune Business it "served no one's interests" for disputes between Customs and Grand Bahama Port Authority (GBPA) to keep rearing up annually, and urged the Government's main revenue collection agency to set "a moving target". The Chamber chief's comments came after this newspaper's Freeport contacts reported numerous GBPA licensee complaints about Customs refusing to renew their annual 'over-the-counter' bond letters, which allow these companies to purchase goods for use in their own businesses duty-free. Sources close to the matter told Tribune Business that Customs, which is now headed in Freeport by Alfred Stubbs, brother-in-law of minister of state for finance, Zhivargo Laing, was refusing to renew these letters unless GBPA licensees provided it with records of all 'bonded goods' (duty free) purchases made in the past year. This newspaper was told that there is nothing in the Hawksbill Creek Agreement or any other Bahamian law that permits Customs to link the two issues together and do this, but sources said those licensees unable to obtain the letter were being told by Customs to seek its approval for each individual 'bonded good' purchase they wanted to make. "They're using this to screen, and as an opportunity to refuse certain things or be arbitrary," one source said of Customs, telling Tribune Business he had received complaints from numerous licensees. "If you go down there to have individual purchase orders approved, Customs are requiring you to bring quotes or estimates in order to have that approved. They're just running people around on paperwork." Fred Smith QC, the Callenders & Co attorney and partner, who is understood to be preparing a major legal action challenging Customs' moves in Freeport, also confirmed to Tribune Business that he had received similar complaints from GBPA licensees. The source expressed concern that the bureaucracy, time and expense involved would destroy Freeport's estimated $120 million 'bonded goods' economy. To comply with Customs' demands, the source said many GBPA licensees were running back to the companies they had purchased bonded goods from, in a bid to obtain the paperwork that would win them their 'bonded letter'. "They're all running back to those companies they bought goods from to get invoices, which is putting a huge burden on those companies," the source said. Meanwhile, Mr Swain, the GBPA Chamber president, told Tribune Business that while no such complaints had been made to him officially, he had invited Customs to be the presenter at the organisation's luncheon later this month. Explaining that he had already met with Customs on the 'over-the-counter bonded goods' regime, Mr Swain said he wanted the Chamber's members to gain "first hand information on the new Customs regime". This, he added, would ensure that GBPA licensees were fully educated on Customs' requirements, and help to prevent episodes where they did "not get bonded letters for reasons they are not fully aware of". Customs is expected to confirm its participation by next week. Mr Swain described as "a burden" Customs' position that GBPA licensees without bonded letters seek its approval for every individual purchase made. "You cannot spend all day, every day, there when you want to get something approved," he added. "That's annoying and not good for business at all." And the often-poor accounting and recordkeeping systems employed by many Bahamian businesses left them vulnerable to Customs' demands for all bonded goods purchase documents, with some companies not retaining the required information. "I think it's important that it be resolved once and for all," Mr Swain told Tribune Business of Freeport's 'bonded goods' regime. "I don't see any reason why it should continue to go on as an issue. "It doesn't serve anyone's interests for it to go on. Here it is, you have an economy in dire straits, a recession, whatever you want to call it. The economy is not good. Whenever you have these requirements put in place that become a burden to doing business in Freeport, it is not good. We don't want to burden business in Freeport." Customs, Mr Swain said, had told him that "the majority" of GBPA licensees were complying with the bonded goods regulatory regime. He called on the revenue collecting agency to ensure the goal posts did not constantly move. "We don't want a moving target," he told Tribune Business. "If this is the requirement, stick to the requirement and let us operate on this basis. I don't see why it should be changing every other year, and that's something that needs to be addressed and resolved once and for all.... It can't be moved two years from now, as it will frustrate business people." The purpose of inviting Customs to speak at the Chamber luncheon, Mr Swain said, was to enable members "to know from day one what the requirements are, and to start dealing with this issue head on and resolve it. "Every year we have that Customs issue, that bond issue, going on. Let's deal with it from day one. "From the Government side they're trying to collect more revenue, and feel some persons are circumventing the bond in Freeport. That may be the case, but the majority of people are abiding by the rules, and it's hard to see them penalised for something someone else may be doing. It's frustrating, and we don't need anything else frustrating business in Freeport."