The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

THE Bahamas Real Estate Association's (BREA) president yesterday called for "a simple solution" to the protracted approvals process that threatens to "turn off" foreign investors.

Christine Wallace-Whitfield told Tribune Business that the Government and private sector needed to meet and address "our concerns" over the increased bureaucracy and red tape surrounding the approval of real estate deals involving foreign investors.

Disclosing that the problems "came across my desk towards the end of last year", Mrs Wallace-Whitfield said she raised the issue with Brent Symonette, minister of financial services, trade and industry and Immigration, who had offered to assist any BREA members if they encountered difficulties. "It's an issue we're trying to deal with," she told this newspaper. "It's not been easy. I'm getting more and more complaints about this. It's something the Government really needs to look at seriously. We don't want foreign investors turning around and going elsewhere."

Tribune Business revealed on Thursday how attorneys are warning that the Bahamas is "shooting ourselves in the foot" through red tape that has caused multi-month delays to the closing of real estate transactions involving foreign investors.

The increased costs and bureaucracy are said to be creating such "uncertainty and anxiety" that many overseas owners "want to get out" of the Bahamas.

The problems stem from the increased paperwork demanded by the Central Bank before it will give permission for real estate sales proceeds to be remitted to foreign buyers, although the regulator's governor has today unveiled measures to ease these requirements (see other articles on Page 1B).

This is linked to Value-Added Tax's (VAT) imposition on real estate transactions, which now requires the sales price to be approved and stamped by both the Department of Inland Revenue and Public Treasury.

In the past, conveyances only required the latter's 'stamp of approval', and the extra layer of bureaucracy can potentially add several months to the approvals process - especially if one or both challenges the purchase price, and demand appraisals be done to justify it.

"Oh my God. It's such a lengthy process," Mrs Wallace-Whitfield told Tribune Business yesterday. "There has to be a simply solution for closing a deal. It's difficult."

She added that it was vital to "be upfront" with foreign investors on how the closing process worked, and likely time taken, and said: "I think it's when you get to the point where there's an issue with Inland Revenue - when the appraisal is provided, and there's a difference from the purchase price. It then becomes a problem."

Mrs Wallace-Whitfield acknowledged that the deal closing period was so protracted that some parties "get turned off and pull out", and said: "It's to the point now where we need to sit down again with the Government and let them know our concerns; the real estate community, the attorneys.

"We need to get together and discuss how we can make buying in the Bahamas easier. We don't want to give our land away, but investors love this country, love this land. Yet they're going to go somewhere else. It's a nightmare."