New Bahamas Government To Review Offshore Laws

by Mike Godfrey, Tax-News.com, New York

07 May 2002

After the Bahamas' Progressive Liberal Party, led by Perry Gladstone Christie, ousted the incumbent Free National Movement in last week's general election, ministers in the new administration have moved swiftly to review aspects of the controversial legislation put in place by the outgoing government to win acceptance from the FATF, the OECD and the US.

The Bahamian government will re-examine laws tightening regulation of offshore banks in order to reduce costs and red tape, said deputy Finance Minister James Smith, a former central bank governor. "The Progressive Liberal Party government recognizes the need for The Bahamas to meet international standards", said Mr Smith said on national television. But he said the government will review the laws to accommodate complaints from the country's offshore banking industry; businesses had said that complying with the new standards was costly, cumbersome and full of red tape. There had also been challenges to the constitutionality of the new laws, said Mr Smith.

The Bahamas will also reconsider the country's stand toward the Free Trade Agreement of the Americas (FTAA), said the new minister. "It is very difficult for so many countries in your hemisphere doing something, and you staying on the outside," he said. "You run the risk of being isolated. But we do have a choice at the end of the day to decide to go or not." The outgoing government had provisionally signed on to the FTAA.

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