Bermuda's Opposition Leader Warns Over Damage Caused By Stanley Works U-Turn

by Mike Godfrey, Tax-News.com, Washington

08 August 2002

Responding to Stanley Works' recent announcement that it will not now be reincorporating in Bermuda due to political pressure, the jurisdiction's Opposition Leader, Dr Grant Gibbons warned that the American toolkmaker's decision could have negative consequences for Bermuda's ability to attract international business.

Speaking to the Royal Gazette on Monday, Dr Gibbons explained that: 'Our challenge is that the Bermuda name in the US has been closely associated with the negative publicity surrounding Stanley Works. And while their decision may not have much impact in the short term, Stanley's change in course may create more problems down the road as corporations may now think twice about offshore moves.'

He suggested that in order to limit the damage created by Stanley Works' U-turn, 'A public relations effort in Washington to rebuild our image may be required, and in the US Congress particularly.'

David Ezekiel, the head of the Association of Bermuda International Companies was philosophical about the toolmaker's announcement, explaining to the newspaper that: 'It is unfortunate but more from their (Stanley's) point of view than ours.'

However, he added that although companies with just a nominal presence in Bermuda are not the Island's 'bread and butter business': 'It has more to do with the climate and perception rather than what is in the best interest of shareholders. From a commercial point of view this is unfortunate as it results from political rhetoric that has been negative.'

The Royal Gazette also reported that another company, Leucadia National, is considering backing down in the face of accusations that it is acting in an 'unpatriotic' fashion by seeking to reincorporate offshore. However, Leucadia has until 2005 to make a final decision on whether to shift its incorporation, despite having secured shareholder approval for the move.

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