The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A senior adviser to Prime Minister Perry Christie yesterday urged the Bahamas to “join the bandwagon” by introducing an Investor Citizenship programme to target the world’s wealthiest individuals, something that could have “the most transformative effect” on the economy.

Sean McWeeney QC, the Graham, Thompson & Co attorney and partner, said the Bahamas needed to take “a quality over quantity” approach when it came to attracting financial services business and investors - a strategy an Investor Citizenship initiative would facilitate.

Addressing the 2014 Society of Trust and Estate Practitioners (STEP) Caribbean conference, Mr McWeeney said the programme would offer select investors permanent residency with a “guarantee” of Bahamian citizenship once strict criteria were met.

These conditions included fulfilling commitments to take up residence in the Bahamas, and invest in its economy, with a ‘high bar’ set for the investment dollar value that would be required.

Mr McWeeney emphasised, though, that an Investor Citizenship programme would not be “mass marketed” to the world, with Bahamian citizenship sold en masse to persons who never set foot in the Bahamas.

Moving to allay any knee-jerk political and nationalistic reaction, the noted QC said that instead of being an ‘Open Sesame’, an Investor Citizenship programme would seek to attract more Joe Lewis’s and Izmirlian families to the Bahamas.

The billionaires, both of whom have followed their money to the Bahamas and reside at Lyford Cay, have ultimately invested billions in the domestic economy, and created thousands of local jobs, via Albany and Baha Mar respectively. And it is this model that Mr McWeeney is advocating, and urging the Bahamas to build upon.

Tying his proposal to other reforms he suggested yesterday, Mr McWeeney said: “This improvement in the Immigration bureaucracy is going to become even more critical if we join the bandwagon and initiate an Investor Citizenship programme.

“I think we should. The investment threshold needs to be rather high to attract quality over quantity.”

Reiterating that such an initiative would have in-built safeguards, Mr McWeeney added: “The granting of citizenship to someone who has not set foot in the country is not sustainable, and is a red flag to the OECD.”

The body, which advances the G-20s global tax initiatives, would likely interpret this as an indication of tax evasion, he implied.

Malta had recently been forced to increase its citizenship qualification standards, and Mr McWeeney said countries that adopted such policies would likely lose benefits such as visa waiver rights under the Schenegen Agreement.

“Any country that sells citizenship without extracting commitments for residency and investment is likely to be shot down,” the noted QC added.

But, despite the merits of an Investor Citizenship programme, Mr McWeeney acknowledged that the existing Nationality Act presented a major obstacle to its implementation.

The Act currently mandates that, to meet the “minimum residency qualifications”, a person must be resident in the Bahamas for seven out of the 10 years immediately prior to when the citizenship application was made.

Yet, while this would be “a crippling impediment” to the Citizenship Investor programmes offered by the likes of Malta and St Kitts, Mr McWeeney said what he was advocating would not be modelled on theirs.

“We’re not going to be mass marketing to anybody,” he added. “We’re not interested in getting thousands and thousands of people under such a programme.”

Tribune Business understands that Mr McWeeney’s Investor Citizenship proposal, part of an eight-strong reform package unveiled at the STEP Conference yesterday, is not official policy of the Christie administration.

The Prime Minister’s key adviser, though, called for further Immigration reform, and for the Government to “do a lot more, and do it now”.

Calling for the Bahamas to “roll out the red carpet for investors” and not to “trip them up”, Mr McWeeney said the reality of their experience had to “be in sync” with perceptions.

“A change in mindset, a change in attitude is necessary to adapt,” he added. “We need to recalibrate Immigration policy accordingly.”

The Government has already established a dedicated unit within the Immigration Department to deal with residency and work permit applications by high net worth investors, and those who work for them, and Mr McWeeney said: “There is evidence it is producing positive results.

“The Government needs to do more, a lot more, and needs to do it now. Immigration needs resources to ensure applications are processed to finality and with a minimum of pain for the applicants.”

Mr McWeeney suggested that the specialist Immigration unit should share premises with the Ministry of Financial Services to enhance efficiency and co-ordination when dealing with such permit applications.

He added, meanwhile, that the Bahamas’ status as an independent, sovereign country also gave it a competitive advantage over rival UK dependencies in the Caribbean when it came to the G-20’s global initiatives.

“I think it’s an advantage,” Mr McWeeney said. “When you get down to the question of last man standing, it will be the sovereign, independent countries.”

He added that the UK had “decided the way forward” for the likes of Cayman and Bermuda “with a stroke of a pen”, committing them to even greater transparency.

Mr McWeeney said this represents a reversal on the 1970s, when the Bahamas’ independence was viewed negatively by the financial industry, which had concerns over this nation’s stability.

“It’s interesting how that’s flipped as time has gone on, and the sovereignty of financial centres has become important,” he added.