The Tribune

By RICARDO WELLS

Tribune Staff Reporter

rwells@tribunemedia.net

THE Senate delayed debate yesterday on the Non-Profit Organisations Bill to allow for the review and possible incorporation of suggestions from civil society, according to Attorney General Carl Bethel.

The bill will now be debated on Monday.

The Senate was expected to debate and pass the bill as a part of a compendium of financial services bills being proposed to comply with the requirements of the Financial Action Task Force (FATF).

In addressing the government’s decision in the Senate yesterday, Mr Bethel noted that he had received substantial amendments and comments from Civil Society Bahamas, a group seeking input on the legislation as proposed by the government.

Mr Bethel requested the bill be left “in committee” to allow legal draftspersons in the Office of the Attorney General to review the suggestions of the group, and incorporate aspects where needs exist.

However, he insisted the recommendations would not affect the bill’s overall intent, nor the passage of the compendium financial sector bills passed in the House of Assembly last week.

Those bills all have to be passed by December 31, to keep the Bahamas in-line with its commitments to the G-20, the Organisation for Economic Co-operation and Development (OECD) and the European Union.

“We are a reasonable government, a government that is prepared to accept positive suggestions to improve on our initiatives, necessary criticism where it is so and to act in a positive way and through meaningful dialogue with all partners. It is not our intention to disregard the well-meaning and positive contributions of all who could assist us,” Mr Bethel said.

His comments came less than a day after Civil Society Bahamas contended the legislation, if implemented as proposed, would be catastrophic for Bahamian non-profits.

For such groups to follow through with the new registration demands, they would have to show “evidence” that they are compliant with the “Know Your Client” stipulations - meaning that they know the sources of their funding, and the background of these donors.

Non-profits will also be required by law to maintain financial statements, showing all income and spending, at their registered offices.

Non-profits will also be made to declare these documents to the registrar of companies, who can ultimately require that these financial statements be produced to it.

Those not meeting these requirements can be hit with a $5,000 fine for failing to maintain financial statements.

In addressing the bill’s full scope, Mr Bethel admitted that aspects of the legislation would have to reviewed and reconsidered, but noted the bill was not the Minnis administration’s “invention.”

“It is modelled after comparable legislation elsewhere in the Caribbean,” he said. “We are satisfied that the bill is absolutely and critically necessary for the supervision of this vitally important sector of economic activity.”

He further insisted that to date, there has been little or no accountability in the sector.

“To whom much is given, much can sometimes also be required,” he said.

Meanwhile, debate on the remaining financial services bills - the Commercial Entities (Substance Requirements) Bill 2018; the Removal of Preferential Exemptions Bill 2018 and the Register of Beneficial Ownership Bill 2018; and the Penal Code Amendment Bill 2018 - did proceed as scheduled.

According to Mr Bethel, these bills reflect a continuous dialogue from the past several months with EU officials, as well as with industry leading professional organisations, lawyers and service providers.

Speaking specifically to the Beneficial Ownership Bill, Mr Bethel said the government will require that the beneficial ownership information of all international business companies (IBCs) and Bahamian companies be obtained by financial and corporate services providers (FCSP) or attorneys incorporating or maintaining the same, and that such information be maintained in a digital format which is accessible by law.

The bill will also require an amendment to the Companies Act to allow for non-compliant companies to be struck off of the register of companies.

Mr Bethel revealed that of the 80,000 companies registered in the Bahamas, only about 4,000 apply for business licences - a reality he said gives great cause for concern.

“So you have a mass of companies about whom nothing is known. We also know for a fact that of these 80,000 companies, thousands have not paid or made any annual declaration,” he added.

The amendment will give the registrar of companies the power to strike all dormant companies from its register, on identical terms as applied to dormant bank accounts.

This means that any property owned by that business will be held by the registrar and then vested in the Public Treasury after a period of 17 years.

Of the Removal of Preferential Exemptions Bill, Mr Bethel said the government is seeking to create a “level playing field” between IBCs and regular Bahamian companies as it relates to exemptions.

The bill will remove all exemptions from regular taxation for IBCs.

Of the Commercial Entities (Substance Requirements) Bill 2018, Mr Bethel said the legislation will require all IBCs and similar offshore vehicles to perform their income generating activities within the Bahamas.

Lastly, of the Penal Code Amendment 2018, Mr Bethel said once passed, the Bahamas would finally be able to shake the label of "tax haven," insisting that no other jurisdiction would be "credibly" able to make the claim.