Policies Towards Foreign Direct Investment

Grenada employs a liberal approach to FDI.  The strategic agenda of the government states that investment is directly related to the socio-economic growth and development of the country.  As a result, the government of Grenada identified additional foreign investment opportunities related to the country’s resource endowment of “sand, sun, sea and rich fertile soil.”  The government of Grenada identified the following 5 priority sectors for investment:

1. Tourism and hospitality services
2. Education and health services
3. Information and communication technology
4. Agribusiness
5. Energy development

The GIDC is the country’s investment promotion agency.  It is comprised of three strategic business units responsible for carrying out its core responsibilities.  They are:

1. Investment Promotion Agency: responsible for investment promotion facilitation;
2. Business Development Centre: provides business support services to micro-, small and medium-sized enterprises; and,
3. Facilities: manages the three business parks owned by the GIDC.

The GIDC is a “one-stop shop” offering:

• Investment and trade information
• Investment incentives
• Investment facilitation and aftercare
• Entrepreneurial/business skills training
• Small business support services
• Industrial facilities
• Policy advice

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no economic and industrial strategies that discriminate against foreign investors.  Non-Grenadian investors may be required to obtain an Alien Landholding License and pay a property transfer tax, which levies a 10 percent fee on the purchase of shares in a Grenadian registered company or real estate asset.  In addition, the sale of shares or real estate to non-nationals attracts a property transfer tax of 15 percent payable by the seller.  Foreign investors employed in Grenada are required to obtain a work permit, renewable annually.  U.S. investors must pay a fee of $1,111 (3,000 Eastern Caribbean dollars) for work permits.  The renewal fee varies based on the investor’s country of citizenship.

There are no limits on foreign ownership or control.  Foreign investors may not invest in or operate investment enterprises that are prejudicial to national security or detrimental to the environment, public health, or national culture, or which contravene the laws of Grenada.  Grenada has accepted but not yet implemented regional obligations on anti-competition concerns.  U.S. investors are not disadvantaged or singled out by any of the ownership or control mechanisms, sector restrictions, or investment screening mechanisms in Grenada relative to other foreign investors.

Grenada maintains an investment screening and approval process for inbound foreign investment for national security concerns.

Other Investment Policy Reviews

Grenada passed its most recent Investment Promotion Act in 2014.  The legislation promotes, encourages, and protects investment in Grenada by providing investors with a stable framework of fundamental and enforceable rights.  It seeks to guarantee and ensure security and fairness in strict accordance with the rule of law and best international standards and practices.  The 2014 Act complies with WTO regulations, the Economic Partnership Agreement (EPA) between the EU and the Caribbean Community (CARICOM), and the Agreement between the Caribbean Forum (CARIFORUM) and the EU.

In 2016, parliament approved a new incentives regime, ensuring all tax exemptions are codified in the relevant legislation.  It also restricted discretionary exemptions and required that the beneficiaries of exemptions file appropriate tax returns and comply with tax requirements.

The incentive regime created a streamlined, simple, and non-discretionary system/process for the granting of incentives.  The Customs and Inland Revenue Departments administer exemptions through a clearly defined rule-based system.

Incentives will be granted to projects within the priority sectors for investment.  They are tourism; manufacturing; agriculture and agribusiness; information technology services; telecommunication providers and business process outsourcing operations; education and training; health and wellness; creative industries; energy; and research and development.  Other sectors also include student accommodation; heavy equipment operators; investment projects above particular investment thresholds; and projects within specific geographical locations.

The incentive regime seeks to provide investment incentives on a performance basis (i.e. the more one invests, the more incentives one can receive).  Therefore, based on the level of investment, different levels of incentives will be granted in a transparent, open, predictable, and non-discriminatory manner.

In the past three years, the government did not undergo any third-party investment policy reviews through multilateral organizations such as the Organization for Economic Cooperation and Development (OECD), the World Trade Organization (WTO), and the United Nations Conference on Trade and Development.

Business Facilitation

Political and economic stability, human resource capacity, supportive government policies, trade and investment opportunities, quality of life, and good infrastructure provide a positive environment for FDI in Grenada.

An investor must register a business name and identify whether it is a partnership or limited liability company.  A registered business can be wholly owned or a joint venture.  The official website of the GIDC includes an investor’s guide that details the procedures for starting and operating a business in Grenada.  The guide has a business procedure flow chart and gives step-by-step instructions for various tasks from registering a business and owning properties to obtaining permits and licenses.  Detailed information on business registration and timelines can be found at: http://grenadaidc.com/investor-centre/investors-guide/starting-up-a-business/#.WKxXdfnQe70 

The GIDC provides business facilitation mechanisms and ensures the equitable treatment of women and underrepresented minorities in the economy.

Outward Investment

The government of Grenada does not promote or incentivize outward investment.  However, under the Revised Treaty of Chagaramus, there are Rights of Establishment in any CARICOM member state.  There is also a chapter on service agreements under the EPA.  Under certain circumstances, provisions in these agreements may offer incentives to the potential investor.  Grenada does not restrict domestic investors from investing abroad.

Bilateral Investment Agreements established between Grenada and several countries are designed to encourage and protect international investments and to ensure that investors receive fair, equitable, and nondiscriminatory treatment.  Bilateral Investment Treaties exist between Grenada and the United States as well as Grenada and the UK.

Grenada is a member of CARICOM, established by the Treaty of Chagaramus in 1973 to promote economic integration and development among its 15 member states.  The Revised Treaty of Chagaramus later established the CARICOM Single Market and Economy (CSME) to provide for the free movement of goods, services, capital, and labor within member states.

Grenada is also a member of CARIFORUM and party to the EPA between the EU and CARICOM member states.  This agreement aims to alleviate poverty, foster regional integration, promote economic cooperation, and propel CARIFORUM states’ entry into the world economy by creating an attractive investment climate and ensuring trade viability on the world market.

Grenada is also a member of the Caribbean-Canada Trade Agreement (CARIBCAN), an agreement between the Canadian government and the Commonwealth Caribbean nations to promote trade, investment, and industrial cooperation.  Treaties with investment provisions also exist through the CARICOM-Costa Rica free trade agreement (FTA), CARICOM-Cuba Cooperation Agreement, CARICOM-Dominican Republic FTA and CARICOM-Venezuela FTA.  Grenada, under the umbrella of CARICOM, is reviewing trade agreements with Cuba and the Dominican Republic to negotiate new market access and opportunities.

There is also an agreement with the Caribbean Basin Initiative (CBI), an initiative created by the United States with the Caribbean and Central America to provide several trade and tariff benefits, among others.

In 2018, Grenada signed a bilateral Open Skies Agreement with the United States.  This agreement replaces the 1946 Bermuda I Agreement, and ensures a more current, responsive, and beneficial arrangement that is reflective of modern civil aviation trends.

Bilateral Taxation Treaties: Grenada passed legislation that will implement the Foreign Account Tax Compliance Act Inter-Governmental Agreement (FATCA) with the United States.  FATCA requires that information on U.S. citizens with accounts at local financial and credit institutions holding in excess of $18,500 (50,000 Eastern Caribbean dollars) be shared with the U.S. Internal Revenue Service (IRS).  The legislation provides for the Competent Authority to be the Comptroller of Inland Revenue, who will communicate directly with the IRS.  The Comptroller will mandate his/her staff to gather information from financial institutions to be divulged to the IRS.  According to the legislation, “failure to comply with such a request is a summary offence punishable by a fine not exceeding $100,000 [Eastern Caribbean dollars].”

The legislation also provides for the protection of privacy, stating that the Competent Authority must protect confidential account information.  Other than FATCA, the United States does not have a tax treaty with Grenada.

Transparency of the Regulatory System

Grenada recognizes that investors value transparent rules and regulations dealing with investment.

The Investment Act and the Investment Promotion Regime promote transparency by authorizing investment incentives in key sectors through the GIDC.  This helps to streamline processes, standardize treatment of investors, and better define investment rights.  It also provides procedural guarantees and reduces the possibility for political influence in business negotiations.

Grenada also promotes investment by consulting with interested parties, simplifying and codifying legislation, using plain language drafting, developing registers of existing and proposed regulation, expanding the use of electronic dissemination of regulatory material, and publishing and reviewing administrative decisions.

Tax, labor, environment, health and safety, and other laws or policies do not distort nor impede investment.  In theory, bureaucratic procedures, including those for licenses and permits, are sufficiently streamlined and transparent.  In practice, local authorities recognize that procedures can sometimes be slow.

Legal, regulatory, and accounting systems are generally transparent and consistent with international norms.  Public finances and debt obligations, including explicit and contingent liabilities, are also transparent and in keeping with international requirements.  There are clear institutional arrangements established to support the implementation of transparent regimes governing investment.

International Regulatory Considerations

Grenada has been a member of the WTO since 1996 and is a party to agreements established under the organization.  In pursuit of WTO compliance, Grenada recently signed, and is in the process of negotiating, trade and investment agreements that contain provisions better aligned with the provisions of the WTO.  Grenada is a member of CARICOM and the CSME, which adheres to the international norms and regulatory standards outlined by the WTO.  In keeping with WTO regulations, the government notifies all draft technical regulations to the WTO Committee on Technical Barriers to Trade.

Legal System and Judicial Independence

The Prime Minister and his cabinet have the executive authority to negotiate and sign international agreements and conventions with other states and international organizations.

Grenada’s judicial system is based on English common law.  The judiciary has four levels: The Magistrates Court, the High Court, the Eastern Caribbean Supreme Court, and the UK-based Privy Council.

The Magistrates Court primarily handles minor civil and criminal cases, while the High Court adjudicates cases under the purview of the Acts of Parliament.  Appeals from the Magistrates Court are heard by the High Court, while appeals from the High Court are heard by the Eastern Caribbean Supreme Court.  The Eastern Caribbean Supreme Court is comprised of the Chief Justice, who serves as the Head of the Judiciary; four Justices of Appeal; nineteen High Court Judges; and three Masters, who are primarily responsible for procedural and interlocutory matters.  The Court of Appeal judges are based at the Court’s headquarters in Castries, St. Lucia.

The Privy Council serves Grenada as the final Court of Appeal.  However, the Caribbean Court of Justice (CCJ) has compulsory and exclusive jurisdiction under Section 211 of the Revised Treaty of Chaguaramas, to which Grenada is a party.  The Treaty delineates rights and responsibilities within CARICOM to hear and decide disputes concerning the interpretation and application of the Treaty.

The judicial system remains independent of the executive branch, and judicial processes are generally competent, fair, and reliable.  Provisions are also made for appeals with the relevant court.  Grenadian law also provides for the use of arbitration and mediation to resolve investment disputes.

Laws and Regulations on Foreign Direct Investment

The economy is supported by a strong legislative and regulatory framework that encourages FDI and promotes investment initiatives.  Grenada augmented the investment climate with a revitalization of its CBI program.  In 2018, receipts from the CBI program were more than $29.6 million (80 million Eastern Caribbean dollars), which financed several developments in the tourism sector.

In 2016, parliament passed several legislative changes to enhance the investment climate in Grenada and ensure a streamlined process for investors.  Changes were made to the following Acts:

• Value Added Tax Amendment Act – This Act amended the Value Added Tax Act Cap.333A to provide for VAT exemptions for qualifying investments in priority sectors and should be applied in conjunction with regulations made pursuant to the Investment Act of 2014 to determine what the priority sectors are for economic growth.

• Excise Tax Amendment Act – This Act amends the Excise Tax Act Cap. 94 to provide for tax incentives for investors engaged in manufacturing and investors entitled to conditional duties exemptions for motor vehicles.

• Property Transfer Tax Amendment Act – This Act amends the Property Transfer Tax Act Cap. 257C to provide more favourable rates of property transfer tax for investors. The Property Transfer Tax (Amendment) Act, 2015 (No. 23 of 2015) reduced the property transfer tax payable by non-citizens with qualifying investments from 10 percent to 5 percent. This Act expands this incentive and would be applied in conjunction with regulations made pursuant to the Investment Act for the establishment of priority sectors for economic growth.

• Customs Service Charge Amendment Act – This Act amends the Customs (Service Charge) Act Cap. 75D to remove the discretionary power of cabinet to prescribe varying rates of customs service charge (CSC) and to prescribe a new rate of CSC applicable to investors engaged in manufacturing.

• Investment Amendment Act– This Act provides for specified circumstances under which the Minister of Finance may make regulations under the principal Act.

• Bankruptcy and Insolvency Amendment Act – This Act modernized the law relating to bankruptcy and insolvency of individuals and companies. The Bankruptcy Act, which applies only to individuals, was repealed.  Provisions in other Acts, such as the Companies Act, dealing with liquidation or winding up, continue to apply.  The Act is based on the Canadian Bankruptcy and Insolvency Act, which has been used as a model in several Caribbean countries.

• Income Tax Amendment Act– This Act amended the Income Tax Act Cap. 149 to provide for a waiver on withholding tax applicable on specified types of repatriated funds relating to investors engaged in tourism accommodation or health and wellness, among other matters.

The GIDC, together with the Inland Revenue and Customs Department of Grenada, works to ensure adherence to the rule of law and to facilitate the procedures outlined in the revised investment regime.  The legal and regulatory framework governing foreign direct investment in Grenada is described here:

Competition and Anti-Trust Laws

There are no laws that regulate competition in Grenada.  However, Grenada discussed model draft bills at the CARICOM and Organization of Eastern Caribbean States (OECS) levels.  These drafts are being formulated to strengthen market regimes under the CSME.  CARICOM established a Competition Commission and plans are underway to establish a sub-regional Eastern Caribbean Competition Commission.

Expropriation and Compensation

According to the Constitution, Grenada shall not compulsorily acquire or take possession of any investment or any asset of an investor except for a purpose which is legal and non-discriminatory.  If the government expropriates property for a legal purpose, it must promptly pay adequate and effective compensation.  Owners of expropriated assets have the right to file claims in the High Court regarding the amount of compensation or ownership of the expropriated asset.

In the past, Grenadian citizens had their lands expropriated to permit foreign investments but were compensated for such actions.  There are no sectors at greater risk of expropriation, and there are no laws requiring local ownership.  All expropriations have been subject to legal due process.

Dispute Settlement

ICSID Convention and New York Convention

Grenada is a signatory and contracting member of the International Center for Settlement of Investment Disputes (ICSID) since 1991 and has engaged this platform to resolve past disputes.  While Grenadian laws have adapted the provisions outlined in the New York Convention, the country is not a contracting state and has not ratified the convention.

Investor-State Dispute Settlement

In 2016, parliament repealed the 1994 Electricity Supply Act, opening the market to potential independent power producers, with a preference for using renewable energy resources.  This repealed the exclusive license that was granted to the country’s sole electricity provider, Grenada Electricity Services (GRENLEC).  WRB Enterprises, an American company, had a significant stake in GRENLEC.  WRB and the government of Grenada ultimately agreed that the 2016 Electricity Supply Act amounted to a breach of GRENLEC’s contract with the government of Grenada.  The parties went to arbitration to determine the value of WRB’s shares, which the government was contractually required to repurchase.  A ruling was handed down in March 2020 by the ICSID ordering the government of Grenada to pay WRB over $74 million (200 million Eastern Caribbean dollars) to repurchase WRB’s majority shareholding interest in GRENLEC.

There is no history of extrajudicial action against foreign investors.

International Commercial Arbitration and Foreign Courts

In the event of an investment dispute between two foreign parties, between a foreign investor(s) and Grenadian parties, between Grenadian partners, or between investors and the government of Grenada, Grenadian law mandates that the parties shall first seek to settle their differences through consultation or mediation.  In the event that the parties fail to resolve the matter, they may then submit their dispute to arbitration; file a lawsuit in Grenadian courts; invoke the jurisdiction of the Caribbean Court of Justice; or adopt such other procedures as provided for in the Articles of Association of the investment enterprise.

There is no government interference in the court system.  Grenada participates in a court-connected mediation mechanism that can be accessed through the Mediation Centre.  This Centre was established by the statutory provisions of the Practice Direction Act No.1 of 2003.  It extends court-connected mediation to all member states of the OECS and allows for civil actions filed in court to be referred to mediation.  Through this system, parties can utilize alternative dispute resolution mechanisms, including mediation, if the court deems them to be appropriate mechanisms for resolving the case.

Court-connected mediation, however, cannot be used in family proceedings, insolvency (including winding up of companies), non-contentious probate proceedings, proceedings when the High Court is acting as a prize court, and any other proceeding in the Supreme Court.

Bankruptcy Regulations

Grenada ranked 168 out of 190 for ease of resolving insolvency in the World Bank’s Doing Business Report for 2019, the same ranking it received in 2018.

Chapter 27 of the Bankruptcy Act (Amended by Act No. 10 of 1990) makes provisions for all aspects of bankruptcy.  This was one of the laws recently amended under the new investment regime to modernize the law relating to bankruptcy and insolvency of individuals and companies.

Part III of this Act sets out what constitutes bankruptcy and the procedure for creditors to apply to the High Court for a bankruptcy order against a debtor and the appointment of a trustee in bankruptcy.  There are also provisions for the court to appoint an interim receiver pending the outcome of the application for a bankruptcy order.

Part III also has provision for a process whereby an insolvent person, with leave of the court, may make an assignment of the insolvent person’s property for the general benefit of creditors of the insolvent person.

The High Court exercises exclusive jurisdiction in matters related to bankruptcy.

Investment Incentives

Grenada provides a legal package of benefits and concessions for specific investment activities.  Incentives include tax waivers, import duty exemptions, repatriation of profits, and withholding tax exemptions.

Trade-related incentives are notified under Article 25 and Article 27 of the Agreement on Subsidies and Countervailing Measures.  Concessions are available under the Income Tax Act, the Common External Tariff (SRO 42/09), the Property Transfer Act, the Petrol Tax Act, and the Customer Service Charge Act.

Fiscal incentives include:

100 percent investment allowances up to 15 years

50-100 percent property transfer tax waivers

50-100 percent withholding tax waivers

Tax credits of 150 percent for training, research and development

Waiver of VAT on importation of capital goods

Tax exemptions and waiver of duties on building materials

Non-fiscal incentives include:

Equal treatment of all investors regardless of nationality or residence

Conversion into freely convertible currency

No discrimination among foreign investors

Repatriation of profits allowed

Other incentives include accelerated depreciation (10 percent on physical plant and machinery; 2 percent on industrial buildings); investment allowance (100 percent write-off on total investment); carry forward of losses for three years; reductions in the property transfer tax; and 100 percent relief from customs duties on physical plant, equipment, and raw materials.  Certain incentives may be linked to the site of investment, the number of persons employed, or other factors.

There was no instance where Grenada needed to review an approved investor for non-compliance with incentive requirements, and Grenada does not have a practice of issuing guarantees or jointly financing foreign direct investment projects.

Foreign Trade Zones/Free Ports/Trade Facilitation

There are no foreign trade zones or free ports in Grenada.  However, there are various companies which offer duty free shopping for travelling customers.

Performance and Data Localization Requirements

CARICOM investors are accorded Rights of Establishment, while other foreign investors are required to obtain work permits and alien landholding licenses to invest in property.

The application fee for a work permit is $37 (100 Eastern Caribbean dollars) payable to the Work Permit Division of the Ministry of Labor.  Along with the completed application form, applicants must also submit four passport-sized photos, a police certificate of character from their country, certificates of qualification, and a letter of intention.  In addition, investors will need a character reference from a reputable person/former employer, a copy of the passport page indicating the last date of arrival in Grenada, a business registration certificate, company stamp, National Insurance Scheme compliance certificate, and recent tax compliance and VAT receipts.

The approval process takes two to three weeks, longer if there are questions, and is valid for one year.  U.S. investors and workers are required to pay $1,111 (3,000 Eastern Caribbean dollars) per year for renewal.

There is no policy of “forced localization” of data storage and Grenada does not pressure international information and communications technology providers to provide source code or encryption keys.  The OECS and other stakeholders have begun to develop draft model laws on electronic regimes.  Laws specific to data storage and protection have not yet made it onto the national legislative agenda.

There are no measures to prevent or impede companies from transmitting customer or business-related data outside the country.  There are no performance requirements.  Investment incentives are applied uniformly to domestic and foreign investors on a case-by-case basis.

There is no requirement for foreign IT providers to turn over source code and/or provide access to encryption.  There are no measures or draft measures that restrict companies from freely transmitting customer or other business-related data outside the economy/country’s territory.

Real Property

The Aliens Landholding Regulation Act No. 29 of 1968 (last amended in 2009) is the primary legislative instrument governing the right to private ownership by non-citizens.  Investors may purchase or lease privately owned land and dispose of, or transfer, interests in the land under the Act.  Investors may hold state lands by grant or lease from the state.

The 2011 appointment of a registrar who focuses specifically on property has reduced the time needed to transfer property in Grenada by almost half.

Property rights and interests are enforced under the Alien Landholding Regulation Act.  The only specific regulation regarding land lease or acquisition by a foreign or non-resident investor is the requirement to acquire an Alien Landholding License.  This is also provided under the Act.  The application process is described on the following website: http://grenadaidc.com/investor-centre/investors-guide/starting-up-a-business/#.WLBEUvnQe70 

Before a deed is issued, there is a title search on the previous owner, followed by conveyance, and the registering of the property to a new owner.  A clear title must first be identified before the process moves forward.  Once the landholder possesses a deed, the property remains legally theirs, occupied or not, until the deed is signed over to someone else.

Grenada ranked 147 out of 190 for the ease of registering property on the World Bank’s 2019 Doing Business Report.

Intellectual Property Rights

The Patents Act (Cap. 227 of the Consolidated Laws of Grenada) or the Trade Marks Act (Cap. 284 of the Consolidated Laws of Grenada), or the Copyright Act Cap. 32 of 1988 (Cap. 67 of the Consolidated Laws of Grenada) guarantees the intellectual property rights of investors and investment enterprises e.g. patents, trademarks, brand names, and copyrighted materials in printed, recorded, or electronic formats.  Grenada is a member of the World Intellectual Property Organization (WIPO), the Paris Convention, the Berne Convention, and the Patent Cooperation Treaty.

Domestic legislation regarding intellectual property protection has not been fully amended to bring it in line with the Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement.  However, updates to existing legislation are currently being drafted and reviewed.

Trademarks

The Trademarks Act No. 1 of 2012 with Trademarks Regulations SRO. No. 18 of 2012 are in force.  The 2012 Trademarks Act repealed and replaced the United Kingdom Trademarks Act, Cap 284 of the Continuous Revised Laws of Grenada.  The re-registration of UK Trademarks is no longer applicable.

Patents

The Registration of United Kingdom patents is still in force, although archaic.  In accordance with section 2 of the Patents Act, any person being the grantee of a patent in the United Kingdom or any person deriving right from such grantee may apply within three years from the date of issue of the patent in in the UK to have it registered in Grenada.

Patent Act Cap 227 of the Continuous Revised Laws of Grenada is not TRIPS compliant.  The Patent Act No. 16 of 2011 has been enacted but to date is not implemented due to its outstanding Regulations.  The implementation of the Patent Act is a priority for 2020.

Copyright

The Copyright Act No. 21 of 2011 is in force.  In accordance with Berne Convention, there is no existing formal system of registration of copyrighted works.  There are current discussions with WIPO, in conjunction with the national intellectual property offices in the region, to consider a voluntary system of registration for copyrighted works.

Geographic Indication Bill

The geographic indication bills have been drafted, and their enactment is a priority for 2020. However, it is important to note that the Trademarks Act makes provision for registration of collective marks in the absence of a geographic indication act.

Industrial Designs Bill

The Industrial Design Bill is a work in progress, and its enactment, according to the Office of Corporate Affairs, is a priority for 2020-2021.  Once these outstanding matters have been addressed, Grenada’s protection of intellectual property rights will be fully consistent with TRIPs, and there will be stronger regulations for the protection of intellectual property rights.

Administration of intellectual property laws in Grenada is under the responsibility of the Ministry of Legal Affairs.  The Corporate Affairs and Intellectual Property Office (CAIPO) is currently responsible for registration of trademarks, re-registration of UK patents, and all other intellectual property matters in accordance with the relevant Acts, once implemented.

There are no reports of any current or past prosecutions of IPR violations.  Additionally, Grenada is not listed in USTR’s Special 301 report or in the 2019 notorious market report.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ 

Capital Markets and Portfolio Investment

Grenada possesses a robust legislative and policy framework that facilitates free flow of financial resources.  Its currency, the Eastern Caribbean dollar, has a fixed exchange rate established by the regional Eastern Caribbean Central Bank (ECCB).  Foreign employees of investment enterprises and their families may repatriate their earnings after paying personal income tax and all other taxes due.  The government of Grenada encourages foreign investors to seek investment capital from financial institutions chartered outside Grenada due to the short domestic supply of capital.  Foreign investors are more likely to tap local financial markets for working capital.

The private sector has access to the limited number of credit instruments.  Grenadian stocks are traded on the Eastern Caribbean Securities Exchange, whose limited liquidity may pose difficulties in conducting transactions.

Money and Banking System

The financial services sector in Grenada is regulated by two entities: The ECCB and the Grenada Authority for Regulation of the Financial Industry (GARFIN).  The ECCB regulates the banking system.  GARFIN oversees non-banking financial institutions through a regulatory system that encourages and facilitates portfolio investment.  The estimated total assets of the largest banks are $1.03 billion.  Information on the percentage of non-performing assets is not available.  Grenada has not experienced cross-shareholding or hostile takeovers.

Foreign banks or branches can establish operations in Grenada subject to prudential measures and regulations governed by the ECCB.  For the requirements and procedures, foreign banks can refer to the following website: https://www.eccb-centralbank.org/p/grenada-1 

There is correspondent banking available with all licensed commercial banks.  No correspondent banking relationships have been lost in the past three years, nor are there any correspondent banking relationships currently in jeopardy.  There are no restrictions on a foreigner’s ability to establish a bank account.

In addition to the banking sector, there are alternative financial services provided through credit unions.  GARFIN regulates credit unions.

Foreign Exchange and Remittances

Foreign Exchange

Grenada’s currency is the Eastern Caribbean dollar, issued by the ECCB located in Saint Kitts and Nevis.  The exchange rate is also determined by the ECCB.  The Eastern Caribbean dollar is pegged to the U.S. dollar at 2.7, adding to the stability of trade and investment in Grenada.

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with investment.  Funds associated with any form of investment can be freely converted into several currencies including U.S. dollar, pound sterling, Canadian dollar, and Euros.  However, banks reserve the right to delay transactions if deemed suspicious or outside the typical level of activity on the account.

Remittance Policies

There are no difficulties or delays regarding remittances and no proposed policy changes that would either tighten or relax access to foreign exchange for investment remittances.

Transfers of currency are protected by Article VII of the International Monetary Fund Articles of Agreement.  Grenada is also a member of the Caribbean Financial Action Task Force.

Sovereign Wealth Funds

Grenada does not have a sovereign wealth fund.

Grenadian state-owned enterprises are legislatively established by acts of Parliament.  These enterprises all have boards of directors appointed by the government and is answerable to the relevant ministries.  Twenty-five of 28 authorized state-owned enterprises (SOEs) are operational.  They secure credit on commercial terms from commercial banks.  SOEs submit annual reports to the Government Audit Department and are subject to audits shared with their parent ministries.  SOEs manage transportation infrastructure (ports and airports), housing, education, hospitals, cement production, investment promotion, and small business development, among other functions.  Generally, where they compete with the private sector, they do so on an equal basis.

Grenada, like its neighbors, acknowledges the OECD guidelines.  Corporate governance of SOEs is established and regulated by founding statutes.  Local courts show no favoritism toward SOEs in the adjudication of investment disputes.

For additional information on SOEs in Grenada see: http://www.oecd.org/countries/grenada/ 

Privatization Program

Grenada does not have a privatization program.

Corporate social responsibility (CSR), interchangeably used with responsible business conduct, is a concept that was introduced to Grenada relatively recently by multinational and regional corporations.  Local businesses are slowly incorporating this principle into their operations.

Some social responsibility initiatives undertaken by the private sector and non-governmental organizations include education programs, fitness programs, sporting activities, and cultural events.  These are predominantly supported by the telecommunication companies Digicel and LIME.  There is also a recent push towards environmentally friendly business practices and development projects.

While firms that promote CSR are more favorably viewed by the community, there is little familiarity with international CSR standards.  Activities are deemed to be responsible business conduct if they are lawful, not a threat to national security, and not detrimental to the environment, health, and culture of the Grenadian people.  Other than this being a requirement for any company local or international operating in Grenada, CSR is not built into the laws governing the operations of a company.

There have been no high profile, controversial instances of private sector impact on human rights or resolution of such cases in the recent past.

Grenada effectively and fairly enforces domestic laws in relation to human rights, labor rights, consumer protection, environmental protection, and other laws/regulations intended to protect individuals from adverse business impacts.  Local labor unions play a role in promoting and monitoring responsible business conduct.

Grenada is a party to the Inter-American Convention against Corruption.  In 2013, parliament passed the Integrity in Public Life Act (Act No.24 of 2013), the country’s first anticorruption bill.  It requires that all public servants report their income and assets to the independent Integrity Commission for review.

The Ombudsman Act of 2007 established the Office of Ombudsman.  The country’s first Ombudsman since independence was appointed in September 2009.  The Office aims to provide effective service, handle complaints in a timely manner, and ensure the highest level of confidentiality and impartiality.

In 2018, the Ombudsman received 64 complaints, compared to 40 in 2017.  Of the 64 complaints, 10 were closed, 26 are ongoing, advice was given for 24, two were discontinued, and two were outside the Ombudsman’s jurisdiction.  The Royal Grenada Police Force was the subject of the highest number of complaints, totaling 14 compared to seven in 2017.  Of those fourteen, three cases were resolved, six cases are ongoing, and advice was given in five cases.

Bribery is illegal in Grenada, and Grenadian officials take bribery allegations seriously.  The Integrity in Public Life Commission monitors and verifies disclosures, although disclosures are not made public except in court.  According to the provisions of the act, failure to file a disclosure should be noted in the Official Gazette.  If the office holder in question fails to file in response to this notification, the commission can seek a court order to enforce compliance.  For the most part, the enforcement of these laws and procedures is effective and they are applied in a non-discriminatory manner.

Grenada is not party to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.  The country accepted and acknowledged the UN Convention against Corruption but has not yet signed or ratified it.

U.S. firms have not identified corruption as an obstacle to FDI in Grenada.

Resources to Report Corruption

Contacts at the government agency or agencies that are responsible for combating corruption:

Tafawa Pierre
Superintendent of Police/Head of FIU
Financial Intelligence Unit (FIU)
The Carenage, St. George’s, Grenada
(473) 435-2373 / 2374
gdafiu@spiceisle.com

Allison Miller
Acting Ombudsman
Office of the Ombudsman
Tanteen, St. George’s, Grenada
(473) 435-9315
ombudsmangd@spiceisle.com

Contact at “watchdog” organization:

Lady Anande Trotman-Joseph
Chairperson
Office of the Integrity Commission
Archibald Avenue, St. George’s, Grenada
(473) 439-9212 / 534-5190
office@grenadaintegritycommission.org

Grenada has a stable parliamentary representative democracy free from political violence.

Grenada signed and ratified all the International Labor Organization’s (ILO) undertakings and enshrined these rights into its labor laws, including the Labor Relations Act No.1 of 1999 and the Employment Act No. 1 of 1999.  Grenadian law protects the right of workers to be represented by a trade union of their choice.

Employers are generally expected to recognize a union that represents the majority of workers but are not obligated to recognize a minority union formed by some employees if most of the workforce does not belong to said union.  In accordance with the Trade Union Recognition Act No 29 of 1979 (Cap. 325 of the Consolidated Laws of Grenada), investors shall grant union representation at any site of employment if most of their employees indicate the desire for union representation.  Investment enterprises are also required to contribute to the social insurance and welfare programs for their workers in accordance with the National Insurance Act.

Regarding essential services, the Ministry of Labor in its discretion may refer the disputes to compulsory arbitration.  Essential services include employees of utility companies; public health and protection sectors, including sanitation; and airport, seaport, and dock services.

Grenada does not restrict the legal activities of trade unions.  Most of the workforce is unionized, and the labor relations atmosphere on the island is generally stable.

Article 32 of the Employment Act prohibits employment of children under the age of 16 except for temporary holiday employment.  Part 7 of the Employment Act provides for the protection and regulation of wages, and article 52 mandates the minimum wage.  Minimum wage schedules are set by occupation.

Preliminary results from the 2018 Labor Force Survey indicated that the unemployment rate fell by 2.7 percent, moving from 23.6 percent in December 2017 to 20.9 percent in June 2018.  The first quarter of the 2019 Labor Force Survey indicated that the unemployment rate fell to 15.2 percent.

There have been strikes in the past year, but none posed an investment risk and negotiations towards a satisfactory resolution continue.  There are no gaps in compliance in law or practice with international labor standards that may pose a reputational risk to investors.  No potential gaps were identified in law or in practice with international standards by the ILO.

No new labor-related laws or regulations were enacted during the last year, and no bills are pending. While there was a revision to the Labor Code in 2016, this revision was not enacted due to employers’ concerns.

Grenada acceded to the U.S. Overseas Private Investment Corporation (OPIC) in 1968, which has since transitioned to become the U.S International Development Finance Corporation (DFC).  This agreement remains in force and allows for DFC activities in Grenada.  Through investment guarantees issued by the U.S. government and other programs, DFC seeks to encourage private investments by providing finance solutions and political risk insurance.

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Post Contacts:

Karl E. Duckworth
Principal Officer, U.S. Embassy Grenada
Tel: (473) 444-1176
Email: duckworthke2@state.gov

Rachér Croney
Economic/Commercial Assistant, U.S. Embassy Grenada
Tel: (473) 444-1173
Email: croneyrr@state.gov

Contacts for Investment-Related Inquiries:

Ronald Theodore
CEO, Grenada Investment Development Corporation
Tel: (473) 444-1035
Email: Invest@grenadaidc.com
rtheodore@grenadaidc.com
Website: www.grenadaidc.com

Cathann Alexander-Pierre
Senior Specialist, Investment Promotion Agency
Grenada Investment Development Corporation
Tel: (473) 444-1033-35, Ext. 236
Email: calexander@grenadaidc.com

Policies toward Foreign Direct Investment

The Government of Guyana (GoG) recognizes foreign direct investment (FDI) as a critical part of growing the economy. In 2019, the GoG published its Green State Development Strategy (GSDS) which highlights the priority areas over the next 20 years. These priorities include investment in agriculture, agro-processing, light manufacturing, renewable energy, tourism, and Information and Communications Technology (ICT).

The Government of Guyana promotes FDI through its Guyana Office for Investment (GO-INVEST). There are no laws and practices that discriminate against foreign investors. Companies willing to invest in Guyana may negotiate tax concessions with the GoG through its investment facilitation agency GO-INVEST.

GO-INVEST focuses primarily on agriculture and agro-processing, tourism, manufacturing, ICT, seafood and aquaculture, and wood processing. Potential investors should note that GO-INVEST is the first point of contact to obtain necessary permits and tax concessions upon which an investment agreement is prepared by GO-INVEST and sent to the Guyana Revenue Authority (GRA). GO-INVEST has been targeted by Guyana’s Ministry of Business for capacity-building assistance to help improve its operations in support of interested investors.

In January of 2020, the GoG released its local content policy framework which is intended to provide a guideline for future legislation on the subject. Criticism of the policy within Guyana’s business community emphasizes the absence of first preference to local companies. Presently, the policy focuses on upstream oil and gas activities. The GoG intends to develop the policy further to include skills development of Guyanese nationals and supplier development of Guyanese companies.

Limits on Foreign Control and Right to Private Ownership and Establishment

Guyana’s constitution specifically protects the rights of foreigners to own property or land in Guyana. Foreign and domestic firms possess the right to establish and own business enterprises and engage in all forms of remunerative activity. Private entities are governed by the Companies Act and are free to acquire or dispose of interest in accordance with the law.

Foreign and domestic firms have the right to establish and own business enterprises and engage in all forms of remunerative activity. Some key sectors like aviation, forestry, banking, and tourism are heavily regulated and require licensing. The process to obtain licenses can be time consuming and may in some instances require approval by subject minister.

According to GO-INVEST’s “Investor’s Roadmap,” the estimated processing time to obtain the approvals to lease state or government-owned lands is about one year. Some investors report much longer processing times. Restrictions on foreign ownership of property exist in the mining sector for small-and-medium-scale mining concessions. Foreign investors interested in participating in the industry at those levels may establish joint ventures with Guyanese nationals, under which the two parties agree to jointly develop a mining property. This type of relationship can carry a high level of risk because arrangements are governed only by private contracts and the sector’s regulatory agency, Guyana Geology and Mines Commission, does not oversee them. The U.S. Embassy strongly encourages investors to exercise due diligence when exploring their options.

Other Investment Policy Reviews

Guyana’s macro-economic fundamentals have remained stable over the past decade. The current administration has articulated its policy focus through the Green State Development Strategy. The developmental policies include incentives for priority areas including renewable energy, agriculture, and agro-processing. The Ministry of Finance published its Public Private Partnership framework to finance such priority areas.

Guyana remains of key economic significance to the Caribbean region with its exceptional growth rate attributed to its oil discoveries. Government policy focuses on attracting inward FDI. The GoG applies national treatment to all economic activities, except for certain mining operations, though some foreign-owned companies conduct large-scale mining operations in the country. During the past year, the GoG took actions to improve the business environment, such as lowering corporate income tax rates. Incentives for FDI include income tax holidays, and tariff and value-added tax (VAT) exemptions.

The World Trade Organization (WTO) published a trade policy review in 2015.

• WTO –

Business Facilitation

All companies operating in Guyana must register with the Registrar of Companies.  Registration fees are lower for companies incorporated in Guyana than those incorporated abroad.  Locally incorporated companies are subjected to a flat fee of approximately $300 and a company incorporated abroad is subject to a fee of approximately $400. Businesses in the sectors requiring specific licenses, such as mining, telecommunications, forestry, and banking must obtain operation licenses from the relevant competent authorities before commencing operations.

GO-INVEST also advises the GoG on the formulation and implementation of national investment policies and provides facilitation services to foreign investors, particularly in completing administrative formalities, such as commercial registration and applications for land purchases or leases.  Under the Status of Aliens Act, foreign and domestic investors have the same rights to purchase and lease land. However, the process to access licensing can be complex and many foreign companies have opted to partner with local companies which may assist with acquiring a license. The Investment Act specifies that there should be no discrimination between private foreign and domestic investors, or among foreign investors from different countries. The authorities maintain that foreign investors have equal access to opportunities arising from privatization of state-owned companies.

Outward Investment

The GoG is focused on attracting inward investment into Guyana.  GO-INVEST also supports Guyanese investors and exporters looking to operate overseas.  In 2019, the Natural Resource Fund act was passed for the creation of a sovereign wealth fund. The act provides the Minister of Finance with the responsibility and overall management of the fund.  The act provides for the minister to enter into an agreement with the Bank of Guyana for the operational management of the fund.  This fund is currently held at the Federal Reserve Bank of New York and received its first US $55M deposit from oil revenue in March, along with the country’s first 2% royalty payment from the total sale of the oil.

Transparency of the Regulatory System

Legal, regulatory, and accounting systems are consistent with international norms. Guyana is a democratic state and a separation of powers exists among the executive, legislative, and judiciary.

As captured in the World Bank’s Doing Business Report, bureaucratic procedures are cumbersome, often requiring the involvement of multiple ministries. Investors report having received conflicting messages from various officials, and difficulty determining where the authority for decision-making lies.  In the absence of adequate legislation, much decision-making remains centralized. An extraordinary number of issues continue to be resolved in the presidential cabinet, a process that is commonly perceived as opaque and slow. Attempts to reform Guyana’s many bureaucratic procedures have not succeeded in reducing red tape.

Draft pieces of legislation are available in the Parliament Library and on the National Assembly website (http://parliament.gov.gy/ ) for public review.

International Regulatory Considerations 

Guyana has been a World Trade Organization (WTO) member since 1995 and adheres to Trade-Related Investment Measures (TRIMs) guidelines. Guyana is a member of the Caribbean Community (CARICOM) and seeks to harmonize its regulatory systems with the rest of the members. The Forest Stewardship Council, Verification and Legal Origin, Reduce Emissions from Deforestation and Forest Degradation (REDD+), are some of the norms incorporated in the regulations.

Guyana has laws on intellectual property rights and patents. However, the lack of enforcement allows for the spread of illegally obtained content.

Laws and Regulations on Foreign Direct Investment 

Legislation exists in Guyana to support foreign investment in the country, but the implementation of relevant legislation continues to be inadequate. The objectives of the Investment Act of 2004 and Industries and Aid and Encouragement act 1951 are to stimulate socio-economic development by attracting and facilitating foreign investment. Other relevant laws include: the Income Tax Act, the Customs Act, the Procurement Act of 2003, the Companies Act of 1991, the Securities Act of 1998, and the Small Business Act. Regulatory actions are still required for much of this legislation to be effectively implemented. The Companies Act provides special provisions for companies incorporated outside of Guyana called “external companies.”

Guyana has no known examples of executive interference in the court system that have adversely affected foreign investors. The judicial system is generally perceived to be slow and ineffective in enforcing legal contracts. The 2020 World Bank’s Doing Business Report, states that it takes 581 days to enforce a contract in Guyana.

Competition and Anti-Trust Laws 

The Competition Commission of Guyana was established under the Competition and Fair Trading Act of 2006. The Competition and Fair Trading act seeks to promote, maintain, and encourage competition; to prohibit the prevention, restriction, or distortion of competition and the abuse of dominant positions in trade; and, to promote the welfare and interests of consumers. The Competition Commission and Consumer Affairs Commission (CCAC) is responsible for investigating complaints by agencies and consumers, eliminating anti-competitive agreements, and may institute or participate in proceedings before a Court of Law.

Expropriation and Compensation 

The government can expropriate property in the public interest under the Acquisition of Land for Public Purposes Act 2001. There is adequate legislation to promote and protect foreign investment. However, the effectiveness of implementation remains cumbersome. Many reports view the judicial system as being slow and ineffective in enforcing legal contracts. There have been no recent cases of expropriation.  All companies are encouraged to conduct due diligence and seek appropriate legal counsel for any potential questions prior to doing business in Guyana.

Dispute Settlement 

Guyana is a party to the International Centre for Settlement of Investment Disputes (ICSID Convention). Additionally, Guyana has ratified the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York Convention), which went into force in December of 2014.

Investor-State Dispute Settlement 

Guyana does not have a bilateral investment treaty with the United States. Negotiations began in 1993 but broke down in 1995. Since then, the two countries have not conducted subsequent negotiations.

Double taxation treaties are in force with Canada (1987), the United Kingdom (1992), and CARICOM (1995). Other double taxation agreements remain under negotiation with India, Kuwait, and the Seychelles. The CARICOM-Dominican Republic Free Trade Agreement provides for the negotiation of a double taxation agreement, but no significant developments have occurred since March 2009.

There are two ongoing investment disputes involving U.S. interests in Guyana. U.S. company Atlantic Tele-Networks owns 80 percent of Guyana Telephone and Telegraph (GTT). The current administration would like to end GTT’s monopoly on international data transmissions and increase competition. GTT’s competitor, Digicel, is allegedly sending data to a satellite facility in Suriname, illegally bypassing GTT’s international data link. Despite GTT’s protests to the government, Digicel has continued to operate, apparently in violation of the monopoly agreement. GTT is also accused of owing $44 million in outstanding taxes since 1991, which could be used to negotiate out the monopoly. All three issues are linked, and negotiations between the government and GTT are proceeding. U.S. company Caribbean Telecommunications Ltd. has filed a lawsuit against Guyana Telephone and Telegraph (GTT), alleging that GTT engaged in unfair trade practices to cancel the company’s license to provide cellular services in Guyana.

International Commercial Arbitration and Foreign Courts 

International arbitration decisions are enforceable under the Arbitration Act of British Guiana of 1931, as amended in 1998. The Act is based on the Geneva Convention for the Execution of Foreign Arbitral Awards of 1927. The GoG enforces foreign awards by way of judicial decisions or action, and such awards must be in line with the policies and laws of Guyana.

According to the 2020 World Bank’s Doing Business Report, resolving disputes in Guyana takes 581 days, and costs 27 percent of the value of the claim on average. According to many businesses, suspected corrupt practices and long delays make the courts an unattractive option for settling investment or contractual disputes, particularly for foreign investors unfamiliar with Guyana.

The GoG has set up the Commercial Court has been set up to expedite commercial disputes, but this court only has one judge presiding, and companies have reported that it is overwhelmed by a backlog of cases.  The Caribbean Court of Justice, based in Trinidad and Tobago, is Guyana’s court of final instance.

Bankruptcy Regulations 

The 1998 Guyana Insolvency Act provides for the facilitation of insolvency proceedings.  The Financial Institutions Act of 2004, gives the Central Bank power to take temporary control of financial institutions in trouble.  This Act provides legal authority for the Central Bank to take a more proactive role in helping insolvent local banks.

According to data collected by the World Bank Doing Business Report, resolving insolvency in Guyana takes three years on average and costs 28.5 percent of the debtor’s estate, with the most likely outcome being that the company will be sold piecemeal.  The average recovery rate is 18 cents on the dollar. Globally, Guyana stands at 163 in the ranking of 190 economies on the Ease of Resolving Insolvency Report.

Investment Incentives 

Investment Incentives are designed to advance broader policy goals, such as boosting research and development or promoting regional economies. Guyana’s economy is undergoing economic transformation. The current administration identified a green agenda through its Green State Development Strategy which seeks to develop a “green economy” through supporting sustainable sectors such as renewable energy, agriculture, and manufacturing. The GoG provides tax concessions for these priority sectors.

Guyana offers an array of incentives to foreign and domestic investors alike in the form of exemption from various taxes, accelerated depreciation rates, full and unrestricted repatriation of capital, profits, and dividends. The first point of contact in applying for tax concessions is the Guyana Office for Investment (GO-INVEST). The purpose of GO-INVEST is to promote and encourage investment in Guyana. The GoG encourages investment in the following industries: agriculture and agro-processing, light manufacturing, and services.   Guyana was awarded the “Best Eco-Tourism Award at the ITB global travel fair in Berlin, Germany. Conde Nast Traveller magazine listed Guyana as one of its suggested 20 destinations to visit in 2020.  Research and Development

Research and Development

The GoG’s research and development is decentralized. For the rice industry, the Guyana Rice Development Board creates new variants of rice and the Guyana Sugar Corporation has an extensive program to create various variations of sugar cane. The Ministry of business has a business incubator program which supports the development of new entrepreneurs. University of Guyana is widely viewed as a major stakeholder in research and development. Foreign firms are encouraged to initiate research and development initiatives. ExxonMobil has developed partnerships with the University of Guyana and Conservation International for research and development.

Opportunities can be found on the following websites:

Guyana Office for Investment:  http://goinvest.gov.gy/investment/investment-guide/

The National Procurement & Tender Administration (NPTA):  http://www.npta.gov.gy/

National Industrial & Commercial Investment Limited: http://www.privatisation.gov.gy/

Ministry of Finance : https://finance.gov.gy/procurements/

Foreign Trade Zones/Free Ports/Trade Facilitation

Guyana does not operate free trade zones. However, consideration is ongoing for establishing such zones in Lethem, a Guyanese town on the Brazilian border that relies heavily on commerce in both countries. The GoG announced plans to build a road from Lethem to Georgetown to provide a cheaper and faster method for transporting goods from Brazil to the Guyanese coast.

Guyana became the 53rd WTO member and first South American country to ratify the new Trade Facilitation Agreement (TFA).  The WTO Secretariat received the country’s instrument of acceptance on November 30, 2015. 

Performance and Data Localization Requirements

There are no data localization requirements.  Foreign investors are not required to establish or maintain a certain amount of data storage within the country.

A requirement to hire locally at least 80 percent of employees is applied equally to domestic and foreign investment projects.  Although no explicit government policy regarding performance requirements exists, some are written into contracts with foreign investors and could include the requirement of a performance bond.  Some contracts require a certain minimum level of investment. Investors are not required to source locally, nor must they export a certain percentage of output.   Foreign exchange is not rationed in proportion to exports, nor are there any requirements for national ownership or technology transfer.

Real Property

Guyana ranks 128 out of 190 countries in the 2020 World Bank ranking for Ease of Business registering property. Guyana has a dual registry system of property rights with distinct requirements, processes, and enforcement mechanisms.  The two types of registry systems are deeds (Deeds and Commercial Registry) and title (Land Registry) registries that operate in separate jurisdictions, which in theory helps avoid the problem of double entry and dual registration.   Companies have complained about Guyana’s property rights being overly bureaucratic and complex, with opaque regulations that overlap and compete. Some report that this affects the proper allocation, enforcement, and effectiveness of property rights, as well as the efficiency of property-based markets, such real estate and financial markets (especially primary ones, such as mortgage markets).  The judicial system is generally perceived to be slow and ineffective in enforcing legal contracts. The World Bank’s Doing Business report 2020 reports it takes 581 days to enforce such contracts. 

Intellectual Property Rights

Upon independence in 1966, Guyana adopted British law on intellectual property rights (IPR). Guyana’s Copyright Act is dated 1956, and its Trademark Act and Patents and Design Act are dated 1973.  Local contacts report that numerous attempts to pass comprehensive legislative updates to this legislation have been unsuccessful. Piecemeal modernization amendments contained in the Geographic Indication Act of 2005, the Competition and Fair Trading Act 2006, the Business Names Registration Act 2000, and the Deeds Registry Authority Act 1999 have offered additional protection to local products and companies.

No modern legislation exists to protect the foreign-registered rights of investors. Guyana joined the World Intellectual Property Organization (WIPO) and acceded to the Berne and Paris Conventions in late 1994. Guyana has not ratified a bilateral intellectual property rights agreement with the United States. The Granger administration has drafted intellectual property rights legislation which has yet to be tabled in Parliament.

Many businesses reported registration time for a patent or trademark may take in excess of six months. However, there is a lack of effective enforcement to protect intellectual property rights. Patent and trademark infringement are common, as is evident among local television broadcasts of pirated and rebroadcasted TV satellite signals. Media sources reported that piracy of foreign academic textbooks is common. Guyana’s laws have not been amended to fully conform to the requirements of the Trade Related Intellectual Property Rights (TRIPS) Agreement.

Guyana is not listed on USTR’s Special 301 Report to congress or the Notorious Markets List.

For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ .

Capital Markets and Portfolio Investment

Guyana has its own stock market, which is supervised by the Guyana Association of Securities Companies and Intermediaries (GASCI).   Guyana’s local stock market has performed well in 2019 with a year on year increase of 20 percent market capitalization.  Guyana’s financial services sector is estimated to have grown by 4.1 percent at mid-year 2019. Credit is available on market terms. The prime lending rate as at half year was 10.5 percent.  There continues to be significant interest in Guyana’s financial sector. 

Money and Banking System

Monetary policy remains accommodative, aimed at achieving price stability and controlling liquidity within the economy.  The financial sector is regulated by the Bank of Guyana (BOG), the country’s central bank.  The BOG is empowered under the Financial Institutions Act 1995 and Bank of Guyana Act to regulate the financial sector.   Regulation highlights include high levels of liquidity, a strong deposit and asset base, and profitable financial institutions.  Liquidity in the banking system increased by 16.8 percent on account of higher excess reserves and higher balances due from banks abroad.  Net domestic credit of the banking system expanded by 12.8 percent to $1.33M from the December 2018 level of $1.2M on account of higher credit to both the public and private sectors.

Nevertheless,  private sector contacts report that access to finance remains an issue for conducting business.  The prime lending rate contracted by 2.5 percent to 10.5 percent from 13.0 percent as of the third quarter 2019.  The BOG maintains a floating exchange rate.  According to the BoG half-year report, monetary aggregates of broad money expanded by 3.3% while that of reserve money contracted by 1.6%.

Guyana has six commercial banks.  Foreign banks provide domestic services or enter the market with the applicable license from the BoG.  Foreigners may establish a bank account without restrictions.

Guyana continues to strengthen its financial system through implementation of its Anti Money Laundering/Counter Financing of Terrorism (CFT) program and the passage of the National Payments Act 2018.  

Foreign Exchange and Remittances

Foreign Exchange

The Guyana dollar (GYD) is fully convertible and transferable.  The Guyanese dollar is also generally stable and its value against the U.S. dollar. The Guyana dollar weighted mid-rate, relevant for official transactions, remained constant at GYD208.50. The un-weighted average mid-rate was GYD214.04 compared with GYD215.78 for the corresponding period in 2018. Foreign exchange transactions increased by 23.0 percent to $4,646.5 million on account of higher turnovers at banks, private trading houses known as cambios, foreign currency accounts, and hard currency transactions. Aggregate purchases were higher than sales, resulting in a net purchase of $4.9M.

No limits exist on inflows or repatriation of funds. However, regulations require that all persons entering and exiting Guyana declare all currency in excess of $10,000 to customs authorities at the port of entry. It is common practice for foreign investors to use subsidiaries outside of Guyana to handle earnings generated by exports.

Remittance Policies 

There is no limit on the acquisition of foreign currency, although the government limits the amount that several state-owned firms may keep for their own purchases.  Regulations on foreign currency denominated bank accounts in Guyana allow funds to be wired in and out of the country electronically without having to go through cumbersome exchange procedures.  Foreign companies operating in Guyana have not reported experiencing government-induced difficulties in repatriating earnings in recent years.

Sovereign Wealth Fund

The Natural Resources Fund (NRF) Act was passed in the National Assembly in January 2019, providing the framework for the establishment of a sovereign wealth fund.  Shortly after the enactment of the NRF,  Guyana became an associate member of the International Forum of Sovereign Wealth Funds (IFSWF).  The Bank of Guyana manages the NRF, which is held at the Federal Reserve Bank of New York. The opposition party has signalled its intent to repeal the NRF Act based on concerns that the bill was passed after the government was defeated by a vote of no confidence without sufficient input from the political opposition.

Guyana has ten state-owned enterprises (SOEs) including: National Industrial and Commercial Investments Ltd. (NICIL), Guyana Sugar Corporation (GUYSUCO), MARDS Rice Complex Ltd., National Insurance Scheme (NIS), Guyana Power and Light (GPL), Guyana Rice Development Board (GRDB), Guyana National Newspapers Ltd.(GNNL), Guyana National Shipping Corporation (GNSC), and Guyana National Printers Ltd. (GNPL).

The private sector competes with (SOEs) for market share, credit, and business opportunities.  It is common for (SOEs) in Guyana to have political interventions.  This is driven through the board of directors which are filled with political appointees.  Furthermore, procurement on behalf of SOEs may be passed through the National Procurement and Tender Administration.

The Public Corporation Act requires public corporations to publish an annual report no later than six months after the end of the calendar year. These reports must be audited by an independent auditor.

Privatization Program

In the 1990s, Guyana underwent significant privatization with the divestment of many sectors.  In 1993, the Privatisation Policy Framework Paper known as the “Privatisation White Paper” was tabled in Parliament and made way for the creation of the Privatisation Unit (PU). Its function was to co-ordinate the implementation of the Government of Guyana’s (GoG’s) privatization program. The Privatisation Unit was tasked with:

• Combining the functions of the Public Corporations Secretariat (PCS) and the National Industrial & Commercial Investments Limited (NICIL);
• Preparing for Cabinet’s approval, the programme strategy and annual programme targets for privatization or liquidation;
• Implementing the privatization of State-Owned-Enterprises (SOEs) and assets selected for inclusion in the program;
• Participating in negotiations for the privatization of SOEs;
• Reviewing offers and make recommendations to Cabinet on the terms and conditions for the sale of SOEs;
• Preparing financial and administrative audits of SOEs not selected for privatization;
• Developing a strategy to build public understanding and support for privatization;
• Ensuring that transparency of the privatization programm is strictly respected and followed;
• Monitoring operations of privatised entities in accordance with the terms and conditions of each respective contract;
• Preparing for Cabinet, broad guidelines on operating policies for privatization, develop action plans for implementation, conduct a public relations campaign and help to build national consensus in support of government’s program.

Foreign investors have an equal access to privatization opportunities. However, there are many reports that the process lacks transparency. Currently, the government is seeking to divest from the sugar industry.

U.S. firms are generally given equal access to these projects through a public bidding process. In some cases, allegations have been made that this bidding process has been less than transparent.  In cases where international financial institution (IFI) funding has been involved in the project, such allegations have been credibly addressed. In cases where the project relied solely on GoG funds, redress has been more problematic to achieve.

Compared to responsible business conduct (RBC) norms in North America and Europe, Guyana-based businesses lag in adopting RBC policies and activities. Local companies have improved RBC as firms react to increased levels of competition, partly to compete or subcontract with companies in the oil and gas sector that emphasize it.  Guyanese consumers are growing in awareness to RBC principles as the population becomes better sensitized. The GoG has expressed hope that large multinational companies will lead the way on RBC practices, setting an example for smaller local firms to follow, particularly in the extractive industries sector.

With Guyana’s major petroleum discovery, and anticipated production, Guyana joined the Extractive Industries Transparency Initiative (EITI) as a candidate country in October 2017.

The law provides criminal penalties for corruption by officials, but the government generally does not enforce the law effectively or uniformly. The relevant laws enacted include: the Integrity Commission Act, State Assets Recovery Act, and the Audit Act. Officials appear to engage in corrupt practices at times with impunity. Several media outlets reported on government corruption in recent years and it remains a significant public concern.  Media and civil society organizations continued to criticize the government for being slow to prosecute corruption cases.  Although the government passed legislation in 1997 that requires public officials to disclose their assets to an Integrity Commission prior to assuming office, media reports suggest that a significant section of public officials did not honor this requirement in 2019.

Widespread concerns remain about inefficiencies and corruption regarding the awarding of contracts, particularly with respect to concerns of collusion and non-transparency.  In his annual report, the Auditor General noted continuous disregard for the procedures, rules, and the laws that govern public procurement system.  There were reports on overpayments of contracts and procurement breaches.  Nevertheless, the country has made some improvements.  According to Transparency International’s 2019 Corruption Perceptions Index (CPI), Guyana is ranked 85 out of 180 countries for perceptions of corruption, advancing 8 spots in comparison to 2018.

Guyana is categorized as a “flawed” democracy according to the Economist Intelligence Unit (EIU). In December 2018 the Government of Guyana fell following the passing of the “no confidence” motion. Subsequently, a series of court cases and eventually the dissolution of Parliament at the end of 2019 allowed for national and regional elections to be held on March 2, 2020. However, ten weeks after elections the results are still unknown. Observers reported that polling on the day of elections were well administered and reflected international standards for democratic elections. Observers reported that the credibility of the process deteriorated during the tabulation of votes. The security environment has further deteriorated following the elections impasse. The security environment in the country continues to be a concern for many businesses. Businesses which are considering investing in Guyana are strongly encouraged to develop adequate security systems.  11. Labor Policies and Practices

Local legislation governing labor in Guyana includes the National Insurance Act, Guyana Labour Act, Occupation Health and Safety Act, and the Termination of Severance and Pay Act.

According to a 2017  survey by the Guyana Bureau of Statistics, the local labor force was estimated at 299,000 with an unemployment rate of 12.2 percent  and youth unemployment of 22.9 percent .  Rural unemployed population represents the vast majority of the total unemployed (72.9 %), and the unemployment rate for women appears to be substantially higher than that for men (15.6 percent vs. 9.9 percent ).  The survey estimates that between 48.6 percent and 52.7 percent of the employed labor force is holding informal jobs. The percentage of male workers holding informal jobs is higher than that of female workers.  Most Guyanese are employed in the agriculture, wholesale and retail trade sectors.  Given the abundance of unskilled labor following divestment of the sugar industry, the economy is undergoing a structural change with retraining programs and structural changes with the preferred skillset of workers.  Guyana’s HDI for 2018 increased to 0.67 from 0.537, an increase of 24.8 percent.  Guyana’s literacy rate is estimated at 90 percent. There is an ongoing push for Information and Communications Technology (ICT) development within schools which has created a talent pool for this industry.  Recently, there has been a focus on ICT and attracting BPOs.

Guyana has one of the highest emigration rates of tertiary educated nationals. A significant number of businesses report having challenges with staff recruitment and retention.  These issues are linked to a small pool of semi-skilled and skilled workers.  Companies entering Guyana should consider training of employees.

The Trade Union Recognition Act of 1997 requires businesses operating in Guyana to recognize and collectively bargain with the trade union selected by a majority of its workers.  The government, on occasion, has unilaterally imposed wage increases. Guyana adheres to the International Labour Organization (ILO) Convention, protecting worker rights.  Labor dispute mechanisms, such as arbitration, are commonplace. In 2019, the minimum wage of the public sector workers increased to approximately $50 monthly. The private sector has a minimum wage of approximately $210.

The Overseas Private Investment Corporation (OPIC) renewed its support for U.S. investors in Guyana in 2000, following the settlement of a long-standing dispute between an OPIC client and the GoG.

The Export-Import Bank of the United States (EX-IM) offers insurance and financing to support U.S. firms exporting to Guyana.  EX-IM will consider financing projects in which the total term of the financing is one to twelve months or one to seven years.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Alexandra King Pile
Political and Economic Counselor

Richard Leo
Economic and Commercial Specialist
Embassy of the United States of America
100 Duke and Young Streets, Kingston
Georgetown, Guyana
Telephone: + (592) 225-4900-9 Ext. 4220 and Ext. 4213
Fax: + (592) 225-8597
Email: commercegeorgetown@state.gov
https://gy.usembassy.gov

Policies Towards Foreign Direct Investment

The government of St. Vincent and the Grenadines, through Invest SVG, strongly encourages FDI, particularly in industries that create jobs and earn foreign currency.  St. Vincent and the Grenadines is an emerging and developing investment destination.  The government is open to all investment, but is currently prioritizing investment in niche markets, particularly tourism, international financial services, agroprocessing, light manufacturing, creative industries, and information and communication technologies.  St. Vincent and the Grenadines benefits from a low inflation rate and growing opportunities in the trade and export sectors.

Invest SVG’s FDI policy is to attract investment into the aforementioned priority sectors.  It advises the government on the formation and implementation of policies and programs that attract and facilitate investment.  The government offers special incentive packages for foreign investments in the hotel industry and light manufacturing.  The government offers other incentive packages on an ad hoc basis.

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no limits on foreign control in St. Vincent and the Grenadines, nor are there requirements for local involvement or ownership in locally registered companies, although non-nationals must apply for a license from the Prime Minister’s Office to acquire more than 50 percent of a company.  An attorney must submit the application and Cabinet must approve it.  Companies holding at least five acres of land may restrict or prohibit the issue or transfer of their shares or debentures to non-nationals.

The government has not officially closed any industries to private enterprise, although some activities such as telecommunications, utilities, broadcasting, banking, and insurance require a government license.

Other Investment Policy Reviews

The OECS, of which St. Vincent and the Grenadines is a member, has not conducted a trade policy review in the last three years.

Business Facilitation

Established in 2003 under the Companies Act, Invest SVG facilitates domestic and foreign direct investment in priority sectors and advises the government on the formation and implementation of policies and programs to attract investment.  Invest SVG provides business support services and market intelligence to all investors.  It also reviews all investment projects applying for government incentives to ensure they conform to national interests and provide economic benefits to the country.  Invest SVG offers an online resource that is useful for navigating the laws, rules, procedures, and registration requirements for foreign investors.  It is available at http://www.investsvg.com .

According to the World Bank’s 2020 Doing Business Report, St. Vincent and the Grenadines ranks 93rd of 190 countries in the ease of starting a business, which takes seven procedures and 10 days to complete.  The general practice is to retain an attorney to prepare all incorporation documents.  A business must register with the Commerce and Intellectual Property Office (CIPO), the Ministry of Trade, the Inland Revenue Department, and the National Insurance Service.  The CIPO has an online information portal that describes the steps to register a business in St. Vincent and the Grenadines.  There is no online registration process, but the required forms are available online.  These must be printed and submitted to the CIPO.  More information is available at http://www.cipo.gov.vc .

Outward Investment

There is no restriction on domestic investors seeking to do business abroad.  Local companies are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.

St. Vincent and the Grenadines has not signed a bilateral investment treaty with the United States.  However, the country does have bilateral tax treaties with the United States, Canada, the UK, Denmark, Norway, Sweden, and Switzerland.  In 1989, Germany and St. Vincent and the Grenadines signed a treaty for the Encouragement and Reciprocal Protection of Investment.  In 2018, St. Vincent and the Grenadines and the United Arab Emirates concluded an Agreement on the Avoidance of Double Taxation on Income and an Agreement for the Promotion and Protection of Investments.  St. Vincent and the Grenadines is also party to the following economic communities and organizations:

Caribbean Community

The Treaty of Chaguaramas established the Caribbean Community (CARICOM) in 1973.  Its purpose is to promote economic integration among its 15 member states.  Investors operating in St. Vincent and the Grenadines have preferential access to the entire CARICOM market.  The Revised Treaty of Chaguaramas goes further, establishing the CSME and permitting the free movement of goods, capital, and labor within CARICOM states.

Organization of Eastern Caribbean States

The Revised Treaty of Basseterre establishes the Organization of Eastern Caribbean States (OECS).  The OECS consists of seven full member states (Antigua and Barbuda, Dominica, Grenada, Montserrat, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines), and three associate members (Anguilla, Martinique, and the British Virgin Islands).  Guadeloupe signed an accession agreement with the OECS in March 2019.  The purpose of the Treaty is to promote harmonization among member states in foreign policy, defense and security, and economic affairs.  The six independent countries and Montserrat ratified the Revised Treaty of Basseterre establishing the OECS Economic Union, which entered into force in 2011.  The Economic Union established a single financial and economic space within which all factors of production, including goods, services, and people, move without hindrance.

CARIFORUM-EU Economic Partnership Agreement

The Caribbean Forum of the African, Caribbean and Pacific Group of States (CARIFORUM) and the European Community signed an Economic Partnership Agreement (EPA) in 2008.  The overarching objectives of the EPA are to alleviate poverty in CARIFORUM states, to promote regional integration and economic cooperation, and to foster the gradual integration of CARIFORUM states into the world economy by improving their trade capacity and creating investment-conducive environments.  The Agreement promotes trade-related developments in areas such as competition, intellectual property, public procurement, the environment, and protection of personal data.

Caribbean Basin Initiative

The objective of the Caribbean Basin Initiative is to promote economic development through private sector initiatives in Central America and the Caribbean islands by expanding foreign and domestic investment in non-traditional sectors, diversifying country economies, and expanding their exports.  It permits duty-free entry of products manufactured or assembled in St. Vincent and the Grenadines into U.S. markets.

Caribbean/Canada Trade Agreement

Caribbean/Canada Trade Agreement (CARIBCAN) is an economic and trade development assistance program for Commonwealth Caribbean countries in which Canada provides most products originating in Commonwealth Caribbean countries with duty-free access to its national market.

Transparency of the Regulatory System

St. Vincent and the Grenadines uses transparent policies and laws to foster competition and establish clear rules for foreign and domestic investors in the areas of tax, labor, environment, health, and safety.  Accounting, legal, and regulatory procedures are generally transparent and consistent with international norms.  The International Financial Accounting Standards, which stem from the General Accepted Accounting Principles, govern the profession in St. Vincent and the Grenadines.

Rulemaking and regulatory authority rests in the unicameral House of Assembly, which has fifteen elected members and six appointed senators who sit for a five-year term.  The Public Accounts Committee and Director of Audits ensure the government follows administrative processes.

National laws govern all regulations relating to foreign investment.  Ministries develop these laws and the Ministry of Legal Affairs drafts them.  Laws pertaining to Invest SVG also govern FDI.  Invest SVG has the main responsibility for investment supervision, while the Ministry of Economic Planning, Sustainable Development, Industry, Information and Labor tracks investments to collect information for national statistics and reporting purposes.

The government publishes most draft bills in local newspapers for public comment.  In addition, the government circulates bills at stakeholder meetings.  Some bills and laws are published on the government website: www.gov.vc .  The government sometimes establishes a select committee to suggest amendments to specified draft bills.  In some instances, these mechanisms may also apply to investment laws and regulations.  There is no obligation for the government to consider proposed amendments prior to implementation.  The government discloses information on public finances and debt obligations.  The annual budget address can be found online.

The country’s membership in regional organizations, particularly the OECS and its Economic Union, commits the state to implement all appropriate measures to fulfill its various treaty obligations.  For example, the Banking Act, which establishes a single banking space and the harmonization of banking regulations in the Economic Union, is uniformly in force in the eight member territories of the ECCU, although there are some minor differences in implementation from country to country.  The most recent Caribbean Financial Action Task Force (CFATF) Mutual Evaluation assessment found St. Vincent and the Grenadines to be largely compliant. The ECCB is the supervisory authority over financial institutions registered under the Banking Act of 2015.

An external company must be registered with the Commercial Registry in St. Vincent and the Grenadines if it wishes to operate in the country.  Companies using or manufacturing chemicals must first obtain approval of their environmental and health practices from the St. Vincent and the Grenadines National Standards Institution and the Environmental Division of the Ministry of Health.

International Regulatory Considerations

As a member of the OECS and the ECCU, St. Vincent and the Grenadines subscribes to a set of principles and policies outlined in the Revised Treaty of Basseterre.  The relationship between national and regional systems is such that each participating member state is expected to coordinate and adopt, where possible, common national policies aimed at the progressive harmonization of relevant policies and systems across the region.  Thus, the country must implement regionally developed regulations, such as legislation passed under the OECS Authority, unless it seeks specific concessions not to do so.

The country’s Bureau of Standards is a statutory body established under the Standards Act of 1992 to prepare and promulgate standards in relation to goods, services, processes, and practices. As a signatory to the World Trade Organization’s (WTO) Agreement on the Technical Barriers to Trade, St. Vincent and the Grenadines must harmonize all national standards to international norms to avoid creating technical barriers to trade.

St. Vincent and the Grenadines ratified the WTO Trade Facilitation Agreement (TFA) in January 2017 and subsequently notified its Category A measures.  Included in the Trade Facilitation Agreement are measures to improve risk management techniques and a post-clearance audit system to eliminate delays and congestion at the port.  These measures have not been fully implemented. A full list of measures undertaken pursuant to the TFA is available at: https://www.tfadatabase.org/members/saint-vincent-and-the-grenadines/measure-breakdown .

Legal System and Judicial Independence

The country’s legal system is based on the British common law system.  The constitution guarantees the independence of the judiciary.  The judicial system consists of lower courts, called magistrates’ courts, and a family court.  The Eastern Caribbean Supreme Court Act establishes the Supreme Court of Judicature, which consists of the High Court and the Eastern Caribbean Court of Appeal.  The High Court hears criminal and civil (commercial) matters and makes determinations on the constitutional matters.  Parties may appeal first to the Eastern Caribbean Supreme Court, an itinerant court that hears appeals from all OECS members.  The final court of appeal is the Judicial Committee of the Privy Council of the UK.

The country has a strong judicial system that upholds the sanctity of contracts and prevents unwarranted discrimination towards foreign investors.  The government treats foreign investors and local investors equally with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.  The police and court systems are generally unbiased in commercial matters.

The Caribbean Court of Justice (CCJ) is the regional judicial tribunal.  The CCJ has original jurisdiction to interpret and apply the Revised Treaty of Chaguaramas.  St. Vincent and the Grenadines is subject to the original jurisdiction of the CCJ only.

The United States and St. Vincent and the Grenadines are both parties to the WTO.  The WTO Dispute Settlement Panel and Appellate Body resolve disputes over WTO agreements, while courts of appropriate jurisdiction in both countries resolve private disputes.

Laws and Regulations on Foreign Direct Investment

Invest SVG provides guidance on the relevant laws, rules, procedures, and reporting requirements for investors.  Invest SVG has the authority to screen and review FDI projects.  The review process is transparent and contingent on the size of capital investment and the project’s projected economic impact.  The investor must complete a series of steps to obtain a business license.  These steps are listed at http://www.investsvg.com .  All potential investors seeking an incentive package must submit their proposals for review by Invest SVG to ensure the project is consistent with the nation’s laws and interests and would provide economic benefits to the country.

Local enterprises generally welcome joint ventures with foreign investors in order to access technology, expertise, markets, and capital.

Competition and Anti-Trust Laws

Chapter 8 of the Revised Treaty of Chaguaramas outlines the competition policy applicable to CARICOM states.  Member states are required to establish and maintain a national competition authority for implementing the rules of competition.  CARICOM established a Caribbean Competition Commission to apply rules of competition regarding anti-competitive cross-border business conduct.  CARICOM competition policy addresses anti-competitive business conduct such as agreements between enterprises, decisions by associations of enterprises, and concerted practices by enterprises that have as their object or effect the prevention, restriction, or distortion of competition within the Community, and actions by which an enterprise abuses its dominant position within the Community.  No legislation is yet in operation to regulate competition in St. Vincent and the Grenadines.

Expropriation and Compensation

Under the Land Acquisition Act, the government may acquire land for a public purpose.  The government must serve a notice of acquisition on the person from whom the land is acquired.  A Board of Assessment determines compensation and files its award in the High Court.  The value of the land is based on the amount for which the land would have been sold on the open market by a willing seller.  Under the Alien’s (Land-Holding Regulation) Act, the government can hold properties forfeit without compensation if the terms of the investment are not met.  The U.S. Embassy Bridgetown is not aware of any outstanding expropriation claims or nationalization of foreign enterprises in St. Vincent and the Grenadines.

Dispute Settlement

ICSID Convention and New York Convention

St. Vincent and the Grenadines is a member of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States of October 14, 1966, and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the New York Arbitration Convention.

According to the World Bank’s 2020 Doing Business Report, dispute resolution generally took 595 days, though this may vary.  The slow court system and bureaucracy are widely seen as main hindrances to timely resolution to commercial disputes.  St. Vincent and the Grenadines ranks 61st of 190 countries in enforcing contracts in the report.  Through the Arbitration Act (1952), the local courts recognize and enforce foreign arbitral awards issued against the government.

Investor-State Dispute Settlement

Investors are permitted to use national or international arbitration regarding contracts entered into with the state.  St. Vincent and the Grenadines does not have a bilateral investment treaty or a free trade agreement with an investment chapter with the United States.  The U.S. Embassy Bridgetown is not aware of any current investment disputes in the country.

International Commercial Arbitration and Foreign Courts

The Eastern Caribbean Supreme Court is the domestic arbitration body and the local courts recognize and enforce foreign arbitral awards.  The Trade Disputes (Arbitration and Inquiry) Act provides that either party to an existing trade dispute can report it to the Governor-General.  The Governor-General may, if both parties consent, refer the dispute to an arbitration panel for settlement.  The arbitration panel must issue an award that is consistent with national employment laws.  Parties can be represented by legal counsel before the arbitration panel.  These bodies may conduct proceedings in public or private.  The Trade Disputes Act provides that alternative dispute mechanisms are available as a means for settling disputes between two private parties.  The government recognizes voluntary mediation or conciliation as dispute resolution mechanisms.  The Eastern Caribbean Supreme Court’s Court of Appeal also provides mediation.

Bankruptcy Regulations

The Bankruptcy and Insolvency Act governs the country’s bankruptcy framework and grants certain rights to debtors and creditors.  The 2020 World Bank Doing Business Report ranks St. Vincent and the Grenadines 168th of 190 countries in resolving insolvency.

Investment Incentives

St. Vincent and the Grenadines offers many incentives via the Fiscal Incentives Act for investors and provides the necessary information on the laws, criteria, and application procedures to qualify for these incentives.

The list of incentives includes exemption from or reduction of duty payments on the importation or purchase of materials and other equipment for use in the construction and operation of the business.  Other incentives are the exemption from or reduction of duty on the importation or purchase of vehicles for use in the operation of the business, and the reduction of property tax of up to 10 percent for land and buildings used in the operation of the business.  The government also provides tax holidays as an investment incentive.  Group I enterprises (50 percent or more local value added) enjoy a 15 year tax holiday period; Group II enterprises (25 to 49 percent  local value added) are granted 12 years; Group III enterprises (10 to 24 percent local value added) receive 10 years.  Enclave enterprises (producing wholly for markets outside CARICOM) enjoy a 15-year tax holiday.  The Industry Unit under the Ministry of Finance, Economic Planning, Sustainable Development and Information Technology administers this Act.

In the tourism sector, the Hotels Aid Act provides incentives for the renovation, refurbishment, and expansion of existing hotels and for the construction of new hotels.  Concessions for expansions of not less than five guest rooms are also available.  The Ministry of Tourism administers the Act.

The corporate tax rate ranges from 15 to 30 percent, except for companies granted tax holidays under the Fiscal Incentives Act.  Companies manufacturing goods for local or export markets and which maintain a special account conforming to Comptroller of Inland Revenue requirements have access to reduced tax rates.  Offshore businesses are also subject to value added tax (VAT) on taxable goods imported into St. Vincent and the Grenadines.  VAT is 16 percent.  An international business company may import machinery and equipment free from certain taxes and customs duties if the imports are capital goods to be used in a company’s business.

The government recognizes trusts if they are in writing and follow the formal requirements for a deed or settlement under the International Trust Act.  The Act recognizes several types of international trusts: protective or spendthrift trusts, charitable trusts, and purpose trusts.  A Registrar of Trusts has direct regulatory responsibilities relating to registration, certificate issuance, and review of trust documentation.  At least one trustee must be registered and licensed for an international trust to be registered.  The government confers certain benefits on registered trusts, including exemptions from various taxes and duties provided the settler was not insolvent at the time the trust was created or did not become insolvent because of the creation of the trust.  The exemptions include income tax, excise tax, customs duties, and stamp duty exemptions.  These are applicable if certain conditions are met, one of which being that the trust must not be domiciled in the country.  The Comptroller of Inland Revenue is empowered to assess a trust’s eligibility for tax exemptions and may require the registered trustee to provide financial information.

If at least one beneficiary of a registered trust becomes resident after the trust is registered, and if the trust is in good standing, the fact of the residency of the beneficiary will not invalidate the trust.  However, neither the trust nor its beneficiaries will be entitled to tax exemptions for any year during which the trust had one or more resident beneficiaries.  An international trust, except one that is an international company, will not become void or voidable as a result of a settler’s bankruptcy, insolvency, or liquidation, the law of the settler’s domicile or ordinary residence notwithstanding.

While there is no formal legislation in relation to incentives in the information and telecommunications sector, commercial presence and establishment is at the discretion of the Cabinet on advice from the National Telecommunications Regulatory Commission.

Foreign Trade Zones/Free Ports/Trade Facilitation

There are no foreign trade zones or free trade zones in St. Vincent and the Grenadines.

Performance and Data Localization Requirements

Companies must meet export performance requirements to take advantage of certain tax incentives.  For example, enclave enterprises must produce goods exclusively for export outside the CARICOM region.  Foreign investors may finance investments using domestic or foreign capital sources.  The Fiscal Incentives Act confers income tax credits in the form of an export allowance to qualifying enterprises for the export of approved products.

The government does not mandate local employment.  The Employment of Foreign Nationals and Commonwealth Citizens Act provides that foreign nationals or Commonwealth citizens must obtain a valid work permits.  The ministry responsible for national security oversees work permit applications.  The government may modify or cancel work permits after a seven-day notice if the holder fails to comply with the conditions of the permit.

While there are no formal performance requirements, government officials strongly encourage investments they believe will create jobs and increase exports and foreign exchange earnings.  In an effort to increase investment, the government of St. Vincent and the Grenadines introduced a series of investment incentives, codified in the Fiscal Incentives Act.  These include tax holidays, import duty exemption, duty-free concessions on the purchase of machinery and equipment, and various tax exemptions.  The government may grant incentives to some investments involving real estate if investors meet minimum investment requirements prescribed by the Alien’s (Land-Holding Regulation) Act.  There is no requirement that enterprises purchase a fixed percentage of goods from local sources.  There are no requirements for foreign information technology providers to turn over source code and/or provide access to surveillance (backdoors into hardware and software keys for encryption, etc.).

Real Property

The Aliens’ Land Holding Act regulates the holding of land and mortgages related to land by individuals who are non-nationals and companies controlled by non-nationals.  Non-nationals must apply for and be granted a license in order to hold land.  The breach of any condition of the license authorizes forfeiture to the government of the interest held by the non-national.  License conditions may require that land be developed within a specific timeframe.  Non-nationals apply for a license to hold land to the office of the Prime Minister through an attorney licensed to practice in St. Vincent and the Grenadines.  If approved, the non-national must file the license at the Registry of the High Court.  The Registry collects all applicable registration fees and stamp duties.  The World Bank’s 2019 Doing Business Report ranks St. Vincent and the Grenadines 168th of 190 countries in ease of registering property.  It takes about 47 days to complete the seven necessary procedures, at a cost of about 11.8 percent of the property value.

Intellectual Property Rights

St. Vincent and the Grenadines has a legislative framework regarding its commitment to the protection of intellectual property rights.  While the legal structures governing intellectual property are adequate, enforcement measures are inconsistent.  The administration of intellectual property laws is the responsibility of the Office of the Attorney General.  The CIPO administers the registration of patents, trademarks, and service marks the. St. Vincent and the Grenadines is a signatory to the Paris Convention on IPR and the Berne Convention.  It is also a member of the UN World Intellectual Property Organization and is a signatory to its treaties.  St. Vincent and the Grenadines is not listed in the U.S. Trade Representative’s 2019 Special 301 report or in the notorious market report.

Article 66 of the Revised Treaty of Chaguaramas (2001) establishing the CSME commits all 15 members to implement stronger intellectual property protection and enforcement.  The EPA between the CARIFORUM states and the European Community contains the most detailed obligations in respect to intellectual property in any trade agreement to which St. Vincent and the Grenadines is a party.  The EPA recognizes the protection and enforcement of intellectual property.  Article 139 of the EPA requires parties to “ensure an adequate and effective implementation of the international treaties dealing with intellectual property to which they are parties, and of the Agreement on Trade Related Aspects of Intellectual Property (TRIPS).”

The Enforcement Division of the Customs and Excise Department spearheads the preventative and enforcement aspects of intellectual property rights protection, which includes the detention, seizure, and forfeiture of counterfeit goods.  The Enforcement Division also conducts investigations of customs offenses and administers fines and penalties.

Capital Markets and Portfolio Investment

St. Vincent and the Grenadines is a member of the ECCU.  As such, it is also a participant on the Eastern Caribbean Securities Exchange (ECSE) and the Regional Government Securities Market.  The ECSE is a regional securities market established by the ECCB and regulated by the Eastern Caribbean Securities Regulatory Commission.  The Securities Act of 2001 regulates activities on the ECSM.

The Eastern Caribbean Securities Exchange and its subsidiaries, the Eastern Caribbean Central Securities Depository and the Eastern Caribbean Central Securities Registry, facilitate activities on the ECSE.  The main activities are the primary issuance and secondary trading of corporate and sovereign securities, the clearance and settlement of issues and trades, maintaining securities holders’ records, and providing custodial, registration, transfer agency, and paying agency services in respect of listed and non-listed securities.  As of March 31, 2019, there were 149 securities listed on the ECSE, comprising 128 sovereign debt instruments, 13 equities, and eight corporate bonds.  Market capitalization stood at USD 1.8 billion.  This represents a significant decrease compared to the previous year and is attributed mainly to the delisting of CIBC First Caribbean International Bank Ltd, whose market capitalization previously accounted for 79.2 percent of total capitalization.  St. Vincent and the Grenadines is open to portfolio investment.

St. Vincent and the Grenadines accepted the obligations of Article VIII of the International Monetary Fund Agreement, sections 2, 3 and 4, and maintains an exchange system free of restrictions on making international payments and transfers.  St. Vincent and the Grenadines does not have a credit bureau.  Lending by public and private financial institutions to the private sector remained relatively flat.

Money and Banking System

Eight participating governments passed the Eastern Caribbean Central Bank Agreement Act.  The Act provides for the establishment of the ECCB, its management and administration, its currency, relations with financial institutions, relations with the participating governments, foreign exchange operations, external reserves, and other related matters.  St. Vincent and the Grenadines is a signatory to this agreement and as such, the ECCB controls St. Vincent and the Grenadines’ currency and regulates its domestic banks.

The Banking Act 2015 is a harmonized piece of legislation across the ECCU member states.  The ECCB and the Ministers of Finance of member states jointly carry out banking supervision under the Act.  The Ministers of Finance usually act in consultation with the ECCB with respect to those areas of responsibility within the Minister of Finance’s portfolio.

Both domestic and foreign banks can establish operations in St. Vincent and the Grenadines.  The Banking Act requires all commercial banks and other institutions to be licensed.  The ECCB regulates financial institutions.  As part of supervision, licensed financial institutions are required to submit monthly, quarterly, and annual performance reports to the ECCB.  In its latest annual report, the ECCB listed the commercial banking sector in St. Vincent and the Grenadines as stable.  Assets of commercial banks totaled USD 833 million at the end of December 2019 and remained relatively consistent during the previous year.  The reserve requirement for commercial banks was 6 percent of deposit liabilities.

The Caribbean region has witnessed a withdrawal of correspondent banking services by U.S. and European banks.  CARICOM remains committed to engaging with key stakeholders on the issue and appointed a Committee of Ministers of Finance on Correspondent Banking to continue to monitor the issue.

Foreign Exchange and Remittances

Foreign Exchange

St. Vincent and the Grenadines is a member of the ECCU and the ECCB.  The currency of exchange is the Eastern Caribbean dollar (XCD).  As a member of the OECS, its foreign exchange system is fully liberalized.  The Eastern Caribbean dollar has been pegged to the U.S. dollar at a rate of XCD 2.70 to USD 1.00 since 1976.  As a result, the Eastern Caribbean dollar does not fluctuate, creating a stable currency environment for trade and investment.

Remittance Policies

Companies registered in St. Vincent and the Grenadines have the right to repatriate all capital, royalties, dividends, and profits free of all taxes or any other charges on foreign exchange transactions.  International business companies are exempt from taxation.  Under present regulations, there are no personal income taxes, estate taxes, corporate income taxes, or withholding taxes for international business companies operating in St. Vincent and the Grenadines.  International business companies are also exempt from competitive tax for 25 years.  Only banks may make currency conversions.  St. Vincent and the Grenadines is a member of the CFATF.

In 2014, the government of St. Vincent and the Grenadines signed an intergovernmental agreement with the United States to facilitate compliance with FATCA, which makes it mandatory for St. Vincent and the Grenadines’ banks to report the banking information of U.S. citizens.

Sovereign Wealth Funds

Neither the government of St. Vincent and the Grenadines, nor the ECCB, of which St. Vincent and the Grenadines is a member, maintain a sovereign wealth fund.

There are currently 28 state-owned enterprises (SOEs) operating in the following sectors: water, housing, transportation (ports), electricity, tourism, information and communication, telecommunications, investment and investment services, financial services, fisheries, agriculture, sports and culture, civil engineering, and infrastructure.

SOEs in St. Vincent and the Grenadines are all wholly owned government entities.  They are headed by boards of directors to which senior managers report.  They are governed by their respective legislation and do not generally pose a threat to investors, as they are not designed for competition.

Privatization Program

There are no targeted privatization programs in St. Vincent and the Grenadines.

The government and the public view positively responsible business conduct.  The private sector is involved in projects that benefit society, including in support of environmental, social, and cultural causes.  Individuals benefit from business-sponsored initiatives when local and foreign owned enterprises volunteer and make monetary or in-kind donations to local causes.

The NGO community, while comparatively small, is involved in fundraising and volunteerism in gender, health, environmental, and community projects.  The government at times partners with NGOs in activities and generally encourages philanthropy.

The law provides criminal penalties for official corruption, and the government generally implements these laws.  St. Vincent and the Grenadines is a signatory to the Inter-American Convention against Corruption, but not to the UN Anti-Corruption Convention.

The Director of Public Prosecutions has the authority to prosecute a number of corruption-related offenses.  Corruption allegations are investigated by the Royal St. Vincent and the Grenadines Police Force.  There is generally no statutory standard obligation for public officers to disclose financial information to a specific authority.  However, if there are confiscation proceedings initiated or contemplated against a corrupt official, pursuant to the Proceeds of Crime Act, No. 38 of 2013, the courts can order disclosure of financial information.  The Financial Intelligence Unit has the authority to conduct financial investigations with a court order.

The law also provides for public access to information.  Human rights organizations assisted individuals in obtaining information but considered the mechanism for gaining access deficient.  Only a narrow list of exceptions outlining the grounds for nondisclosure exists, yet there is no specific timeline for the relevant authority to make the requested response or disclosure.  There are no criminal or administrative sanctions for not providing a response and there is no appeal mechanism for review of a disclosure denial.  Public outreach activities via radio call-in shows encouraged citizens to access public information.

Resources to Report Corruption

Contact at the government agency or agencies that are responsible for combating corruption:

Sejilla McDowall
Director of the Public Prosecutions
Office of Public Prosecutions
Frenches Gate, Kingstown
Telephone Number: 784-457-1344
Email Address: dppsvg@vincysurf.com

Colin John
Commissioner of Police
Royal St. Vincent and the Grenadines Police Force
Kingstown
Telephone Number: 784-457-1211
Email Address: svgpolice@gmail.com

St. Vincent and the Grenadines does not have a recent history of politically motivated violence or civil disturbance.  Elections are peaceful and regarded as being free and fair.  The next general elections are constitutionally due in December 2020.

St. Vincent and the Grenadines’ active labor force was approximately 41,512 persons.  The government generally enforced labor laws effectively.  Government penalties were sufficient to deter violations.  The law, including related regulations and statutory instruments, provides for the rights of workers to form and join unions of their choice, bargain collectively, and conduct legal strikes.  The law prohibits anti-union discrimination and dismissal for engaging in union activities.

The Trade Disputes (Arbitration and Inquiry) Act Chapter 215 provides for establishment of an arbitration tribunal and a board of inquiry in connection with trade disputes and allows provision for the settlement of such disputes.  Labor unions and businesses were generally satisfied with the arbitration panels, which have tripartite representation.  One of the mandates of the Department of Labor is to serve as a dispute resolution mechanism.

The Wages Council Act establishes the Wages Councils, which address minimum wages, hours of work, overtime, vacation, sick leave, and maternity leave for specified categories of workers. Employers who fail to pay minimum wages are subject to orders for payment of the wages.  The statutory minimum wages are set out in the regulations made under the Wages Council Act.  The hours of work for specified categories of workers are usually eight hours per day with overtime generally calculated at a rate of time and a half and double time for work done on Sundays and public holidays.

The Equal Pay Act makes provision for the removal and prevention of discrimination, based on the sex of the employee, in the rates or remuneration for males and females in paid employment. Teachers, police officers, public servants, the Medical Association, industrial workers and some members of the private sector, especially in financial services, operate under collective bargaining agreements.

The Protection of Employment Act No. 20 of 2003 allows for severance.  Article 27 (1) allows employees to ask that their services be deemed as severed after six weeks of being laid off from work.  There is no unemployment insurance or other social security safety net programs for workers laid off for economic reasons.

Trade unions and the leaders of the trade union movement enjoy a strong voice in the labor and economic affairs of the country.  The law also provides that it is lawful to conduct peaceful picketing in contemplation of a trade dispute.

The law provides for a minimum working age of 16, and this provision was generally observed in practice.  Compulsory primary and secondary education policies reinforced minimum age requirements.  The Labor Department had a small cadre of labor inspectors who conduct spot investigations of enterprises and checked records to verify compliance with the labor laws.  These inspectors may take legal action against an employer who employs underage workers.

Investors in the country are responsible for maintaining workers’ rights and safeguarding the natural environment.  Workers have the right to report and/or leave unsafe work environments without jeopardy to continued employment.

St. Vincent and the Grenadines is classified as an upper-middle-income country under the World Bank’s definition.  The DFC may consider investments in certain projects in upper-middle-income countries that address key agency priorities.

* Source for Host Country Data: Eastern Caribbean Central Bank https://www.eccb-centralbank.org/statistics/dashboard-datas/ . All ECCB GDP figures for 2019 are estimates

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Political/Economic Section
U.S. Embassy to Barbados, the Eastern Caribbean and the Organization of Eastern Caribbean States
Telephone Number: 246-227-4000
Email Address: BridgetownPolEcon@state.gov

Policies Towards Foreign Direct Investment

The Government of Suriname (GOS) officially supports and encourages business development through foreign and local investment. The overall investment climate favors U.S. investors with experience working in developing countries. Investment opportunities exist in mining, agriculture, oil and gas sector, timber, fishing, financial technology, and tourism.

With the exception of petroleum, Suriname has no sector-specific laws or practices that discriminate against foreign investors, including U.S. investors, by prohibiting, limiting or conditioning foreign investment. In the oil sector, the state oil company, Staatsolie, maintains sole ownership of all oil-related activities. Foreign investment is possible through exploration and product sharing agreements with Staatsolie. Staatsolie executes oil exploration agreements with foreign firms through a fair and competitive bidding process. Six U.S. companies operate in Surinamese waters, as well eight firms from other countries. InvestSur is Suriname’s official investment agency. It officially launched in 2018, and its mission is to be the first and primary contact for potential investors, to promote Surinamese exports, and to increase FDI in Suriname. Its staff and its activities are limited. In February 2020, InvestSur received a $10 million loan as part of a program from the Inter-American Development Bank (IDB). According to the IDB, the objectives of the program are to strengthen the capacity of InvestSur, enhance awareness about the Suriname brand, and support exporters and connect local suppliers with investors. Suriname does not have a formal business roundtable or ombudsman aimed at investment retention or maintaining an ongoing dialogue with investors.

Limits on Foreign Control and Right to Private Ownership and Establishment

Foreign and domestic private entities can establish and own business enterprises and engage in all forms of remunerative activity.

There are no general limits on foreign ownership or control – statutory, de facto, or otherwise. No law requires that domestic nationals own a minimum percentage of domestic companies or that foreign nationals hold seats on the board. No law caps or reduces the percentage of foreign ownership of any private business enterprise.

Except for petroleum, there are no sector-specific restrictions applied to foreign ownership and control. Within the petroleum sector, the law limits ownership to Staatsolie, the state-owned oil company, which maintains sole ownership of all petroleum-related activities. Caribbean Single Market and Economy (CSME) countries do enjoy favored status over other sources of foreign investment, but in practice international firms from beyond the CSME are not denied investment opportunities. An Economic Partnership Agreement (EPA) with the European Union aims to provide European companies better access to Suriname. Suriname has not yet ratified the EPA. Government ministries screen inbound foreign investments intended for the sector of the economy that they oversee. Special commissions screen all necessary legal and financial documents. Screening criteria vary, but are intended to determine a proposed investment’s compliance with local law. The screening process is neither public nor transparent, and therefore could be considered a barrier to investment. One stated goal of InvestSur is to make this process more transparent and to standardize screening for investments.

There is no indication that U.S. investors are especially disadvantaged or singled out by any of the ownership or control mechanisms, sector restrictions, or investment screening mechanisms, relative to other foreign investors.

Other Investment Policy Reviews

The World Trade Organization (WTO) conducted an investment policy review of Suriname in 2019: https://www.wto.org/english/tratop_e/tpr_e/tp491_e.htm 

The Inter-American Development Bank published a report called Framework for Private Development in Suriname in 2013.The World Bank Group published Suriname Sector Competitiveness Analysis, focusing on the agribusiness and extractive sectors in 2017.

Business Facilitation

Legislation has been drafted on competition policy, limited liability company formation, electronic gazettes to reduce company startup costs, intellectual property, consumer protection, electronic transactions, and establishing a secured transaction framework. However, these laws are still pending. The Ministry of Trade, Industry, and Tourism stated that privacy legislation, tourism law, and intellectual property rights were a top priority to get approved before national elections in May 25. However, the National Assembly did not take up those matters. A draft law regarding government procurement is with parliament for discussion. In 2017, parliament adopted new legislation regarding financial statements and reduction of licensed professions. The authorities also plan to implement procedural reforms to streamline cross-border trade. In November 2018, the government passed legislation to establish a Center for Innovation and Productivity. The center is envisioned to collaborate between trade unions, employers, and the government to promote local production and export. In February 2019, the government created a National Training Authority to implement continuing education programs based on input from the private sector. The World Bank’s Doing Business report indicates starting a business requires 66 days. The local Chamber of Commerce and Industry states it can take as little as 30 days. There is no online registration system. Companies must register with the local Chamber of Commerce and Industry, which provides guidance on registration procedures. At the time of registration, the company needs a local notary’s assent to ratify the company bylaws. For non-residents, the notary also sends a request to the Foreign Exchange Commission for approval. Applicants must obtain a tax number at the registration office of the tax department. Applications then go to the Ministry of Justice and Police and finally to the President for approval. The Ministry of Trade, Industry and Tourism launched the Suriname Electronic Single Window (SESW) in September 2019. Online submission and processing of documents required for import, transit of goods, and export is now possible. Outward Investment

The Government does not promote or incentivize outward investment. Suriname’s outward investment is negligible.

The GOS does not restrict domestic investors from investing abroad, but there are no specific mechanisms in place to promote the practice. Due to the small size of the local market, some domestic companies have expanded to CARICOM member states, such as Guyana and Trinidad.

Transparency of the Regulatory System

Suriname does not use transparent policies and effective laws to foster competition. The National Assembly has delayed its vote on a draft competition law. The Competitiveness Unit Suriname coordinates and monitors national competitiveness and is working towards establishing policies and suggesting legislation to foster competition. Current legislation such as tax, environment, health and safety, or other laws are not purposely used to impede investment, but may still form obstacles. Employment protection legislation is among the most stringent in the world. Labor laws, for instance, prohibit employers from firing an employee without the permission of the Ministry of Labor once the employee has fulfilled his or her probationary period, which by law is limited to two months. Tax laws are criticized for overburdening the formal business sector, while a large informal sector goes untaxed. Many public sector contracts and concessions are not awarded in a clear and transparent manner.

Legal, regulatory, and accounting systems are often outdated and therefore not transparent nor consistent with international norms. The National Assembly passed the Act on Annual Accounts in 2017 to create more fiscal transparency by requiring all companies, including state owned enterprises, to publish annual accounts based on the International Financial Reporting Standards (IFRS). The law will go into effect in 2020 for large companies and 2021 for small and medium sized companies.

There are no informal regulatory processes managed by non-governmental organizations or private sector associations.

Rule-making and regulatory authority exist within relevant ministries at the national level. It is this level of regulation that is most relevant for foreign businesses. The government may consult with relevant stakeholders on regulations but there is no required public process. The government presents draft laws and regulations to the Council of Minsters for discussion and approval. Once approved, the president’s advisory body, the State Council, considers the draft. If approved, the government presents a draft to the National Assembly for discussion, amendment, and approval, and then to the President for signature. Legislation only goes into effect with the signature of the President and after publication in the National Gazette.

There is no current requirement for specific accounting standards. Some companies create financial reports using The Netherlands Generally Accepted Accounting Principles (NL GAAP), some develop standards internal to the company, and some larger firms use resident international firms for their accounting needs. Not all companies prepare financial statements. There is no current requirement for companies to be audited, though some companies include it in their Articles of Association.

Suriname passed new legislation in October 2018 to professionalize and institute better standards in the accountancy profession. The legislation created the Suriname Chartered Accountants Institute (SCAI) and makes membership mandatory for accountants in Suriname. The board of the SCAI has the responsibility to monitor the quality of the profession and apply disciplinary measures. As per 2020, companies (there is an exception for small companies) are obliged to implement IFRS in their financial reports.

Draft bills or regulations are discussed in view of the public and relevant stakeholders may be consulted. The National Assembly has established the email address feedbackwetgeving@dna.sr as a place where individuals can give their opinion on draft legislation.

There is no centralized online location similar to the Federal Register in the United States where key regulatory actions are published. However, the National Assembly publishes the actual text of adopted laws on its website.

It is unclear what the regulatory enforcement mechanisms that ensure the government follows administrative processes might be, as the processes have not been made accountable to the public. There is no public administration law. The Auditor General’s office is an independent body in charge of supervising the financial management of government funds. The Supreme Audit Institution reports to the National Assembly. The Central Accountant Service exercises control on administrative processes at the ministries and reports to the Ministry of Finance. There is no centralized online location where key regulatory actions or their summaries are published, similar to the Federal Register in the United States.

The minimum wage law was revised by State Decree on July 18, 2019. The government will determine the minimum wage biennially.

Regulatory reform efforts announced in prior years have largely not been fully implemented. Suriname has been planning to introduce VAT for a number of years, but adoption and implementation of a VAT law have been delayed so far.

Regulations are developed by ministries that have jurisdiction over the relevant area, in consultation with involved stakeholders.

It is unclear what the regulatory enforcement mechanisms are, as the process has not been made public.

Regulation is not reviewed on the basis of scientific or data-driven assessments. Scientific studies or quantitative analysis on the impact of regulations or rarely conducted and/or not publicly available for comment.

The government’s executive budget proposal and enacted budget are easily accessible to the public. Actual revenues and expenditures regularly deviate from the enacted budget, and the origin and level of accuracy of some information in the budget were not reliable. A full end-of-year report is not publicly available. The Supreme Audit Institution publishes a limited audit based on self-reporting by the ministries.

The State Debt Management Office (SDMO) is responsible for the operational management of the public debt of the government. Data regarding public debt is published every three months in the Government Gazette of Suriname and on the SDMO website.

International Regulatory Considerations

As a member of CARICOM, Suriname has committed to regionally-coordinated regulatory systems. Suriname uses national and international standards. Standards developed by other (international/regional) standardization bodies that Suriname utilizes include: ISO, Codex Alimentarius, International Electro Technical Commission, CROSQ, ASTM International, COPANT, SMIIC (Standards and Metrology Institute for Islamic Countries), NEN (Nederland Normalisatie Instituut), ETSI, GLOBAL GAP, etc.

Suriname uses national and international standards. Standards developed by other (international/regional) standardization bodies that Suriname utilizes include: ISO, Codex Alimentarius, International Electro Technical Commission, CROSQ, ASTM International, COPANT, SMIIC (Standards and Metrology Institute for Islamic Countries), NEN (Nederland Normalisatie Instituut), ETSI, GLOBAL GAP, etc.

Suriname is a member of the World Trade Organization (WTO). The WTO Committee on Technical Barriers to Trade (TBT) lists only one notification from Suriname in 2015.

Legal System and Judicial Independence

Suriname’s legal system is based on the Dutch civil system. Judges uphold the sanctity of contracts, and enforce them in accordance with their terms. When an individual or company disputes a signed contract, they have the right to take the case to court. The judiciary consistently upholds local law, applies it, and enforces it for local and international businesses. Laws are defined in criminal, civil, and commercial codes and verdicts are based on the judge’s interpretation of those codes. There is no specialized commercial court. The commercial codes contain commercial legislation.

Historically, the judicial system has been considered to be independent of the executive branch. Most observers consider the judicial system to be procedurally competent, fair, reliable, and free of overt government interference. Due to a shortage of judges and administrative staff, processing of civil cases can be delayed. Last year, the Court of Justice appointed seven new judges to ease the delay in court cases. The number of judges is now 26.In November 2019, a Court Martial found President Desire Delano Bouterse guilty of the 1982 murder of fifteen political dissidents during a military regime he headed in the 1980s. In January 2020, President Bouterse was due in court to deliver an objection to the verdict, but the hearing was adjourned and postponed. In August 2019, the National Assembly passed legislation to create a Constitutional Court, which could eventually rule on aspects of the President’s murder case.

Draft regulations may be reviewed by involved stakeholders and they may be given the opportunity to comment. Since October 2019, individuals have also had the option to comment on draft legislation via email at feedbackwetgeving@dna.sr. There is no formal, required public consultation process. Suriname has no general administrative law, so there are no special administrative tribunals. Judges of the regular courts also hear cases of administrative law.Laws and Regulations on Foreign Direct Investment

The overall regime, and more particularly the approval of foreign direct investment (FDI), may be discretionary rather than rules-based, leading to heightened unpredictability and uncertainty, and associated risks of favoritism and corruption.

The National Assembly approved the amendment of the commercial code chapter regarding the establishment of a limited liability company in 2016. Parameters addressing enforcement are forthcoming. In 2019, no new legislation or regulation regarding investments was drafted or implemented.

In March 2019, The National Assembly adopted legislation to join the Kimberley Process Certificate of the World Diamond Council Association.

In August 2019, the National Assembly passed legislation to create a Constitutional Court.

In November 2019, the National Assembly amended the State Debt Act, which raised the government’s debt ceiling from 60% of GDP to 95% of GDP.

In February 2020, former Central Bank Governor Robert van Trikt was arrested on fraud charges. As of May 2020, he remained in custody and his legal case was ongoing. In April 2020, the Attorney General asked the National Assembly to indict Finance Minister Gillmore Hoefdraad on charges related to corruption and money laundering.In March 2020, the National Assembly passed the Foreign Exchange Act, which places constraints on the use of foreign currency in cash transactions and establishes a strict exchange rate for the Surinamese dollar. It also grants the government broad authorities to enforce the law, as well as the power to halt the import of “non-essential” goods. In May 2020, a judge suspended the law over questions concerning its constitutionality. The fate of the law will likely be determined by the nascent Constitutional Court.

In April 2020, the National Assembly passed the COVID-19 State of Emergency Law, which grants the government broad powers to enforce COVID-19-related precautionary measures. It also created a $53 million fund to assist struggling businesses, and it allowed the government to take all loans and advances from local institutions since 2002 and consolidate them into a single mega-loan.

There is no primary one-stop-shop website for investments that provide relevant laws, rules, procedures, and reporting requirements for investors.

Competition and Anti-Trust Laws

There are no domestic agencies currently reviewing transactions for competition-related concerns. There are draft laws on competition and consumer protection that have been pending review by the National Assembly for five years now. According to the authorities, no date for enactment is foreseen. Both draft laws also cover state-owned enterprises. The CARICOM Competition Commission is based in Suriname, and it monitors potential anti-competitive practices for enterprises operating within the CARICOM Single Market and Economy.

Expropriation and Compensation

According to Article 34 of Suriname’s constitution, expropriation will take place “only for reasons of public utility” and with prior compensation. In practice, the government has no history of expropriations. However, Article 42 of Suriname’s constitution specifically refers to all natural resources as property of the nation, and states that the nation has inalienable rights to take possession of all natural resources to utilize them for the economic, social, and cultural development of Suriname.There is no history of expropriation.

According to Article 34 of Suriname’s constitution, expropriation will take place “only for reasons of public utility” and with prior compensation. In practice, the government has no history of expropriations. However, Article 42 of Suriname’s constitution specifically refers to all natural resources as property of the nation, and states that the nation has inalienable rights to take possession of all natural resources to utilize them for the economic, social, and cultural development of Suriname.There is no history of expropriation.

Dispute Settlement

ICSID Convention and New York Convention

Suriname is not a party to the Convention on the Settlement of Investment Disputes between States and Nationals of other States (ICSID). Suriname has been a member of the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards since 1964, when the country was still a colony of the Netherlands. Upon becoming independent in 1975, Suriname automatically continued its membership in international conventions and treaties.

There is no specific domestic legislation providing enforcement of awards under the 1958 New York Convention and /or under the ICSID convention.

Investor-State Dispute Settlement

The government is a signatory to the Multilateral Investment Guarantee Agency (MIGA).

Suriname has no BIT or FTA with an investment chapter with the United States.

There have been no publicly known investment disputes in the past 10 years involving a U.S person or other foreign investor. Every effort is made to settle investment disputes outside the court system or via arbitration.

Judgments of foreign arbitral awards are enforced by the local courts only if Suriname has a legal treaty of jurisprudence with the foreign country involved. If not, the foreign judgment can be brought before the Surinamese court for consideration as long as the court determines it has jurisdiction and doing so does not otherwise violate any Surinamese laws. With Suriname’s participation and membership in the Caribbean Court of Justice, judgments from this court are also binding for local courts. Cases have been successfully filed against Suriname before the Inter-American Court of Justice and the Organization of American States. Judgments from these courts have been upheld by the Surinamese legal system.

There is no known history of extrajudicial action against foreign investors.International Commercial Arbitration and Foreign Court

Suriname’s civil law includes options for arbitration. The government reactivated the Suriname Arbitration Institute (SAI) in August 2014 to offer arbitration and mediation services. The SAI collaborates with the Dutch Arbitration Institute.

Local courts only recognize and enforce foreign arbitral awards if doing so is stipulated in the contract or agreement and it does not contradict local law. Foreign arbitration is an accepted means of settling disputes between private parties, but only if local alternatives are exhausted.

There have been no publicly known investment disputes in which state-owned enterprises are involved. Court processes are in general considered transparent and non-discriminatory.Bankruptcy Regulation

Suriname has bankruptcy legislation. Creditors, equity shareholders, and holders of other financial contracts, including foreign contract holders, have the right to file for liquidation of debts due to insolvency. In a case where there is a loan from a commercial bank, repayment of the bank loan takes precedence. Bankruptcy, in principle, is not criminalized. However, in cases where a board of directors encouraged a company to pursue bankruptcy to avoid creditors, courts have viewed this behavior as a criminal offense. In the World Bank’s Doing Business Report, Suriname stands at 138 in the ranking of 190 economies on the ease of resolving insolvency.

Investment Incentives

Under current regulations, foreign investors can benefit from both tax and non-tax based incentives. Tax-based incentives include a nine-year tax holiday that can be extended by one year if the investment is at least USD 13 million; accelerated depreciation of assets; and tax consolidation. Under the Raw Minerals Act, the government grants an exemption of duties for the import of raw materials from CARICOM member countries. Exemptions are also granted in the food industry, the soft drink industry, and the fruit juice industry. In 2011, the government eliminated import duties on computers and related items. The law accords special consideration on investments exceeding USD 50 million and investments in the exploration and exploitation of bauxite, hydrocarbons, gold, and radioactive minerals. Large investments in the mining sector are subject to extensive negotiations between the government and investors. The government maintains the ability to grant incentives that depart from the provisions in the 2001 Investment Law, for example, incentives related to the provisions of infrastructure. The government does not have a practice of issuing guarantees or jointly financing foreign direct investment projects.

Foreign Trade Zones/Free Ports/Trade Facilitation

There are no duty-free import zones in Suriname.

Performance and Data Localization Requirements

There are no policies that mandate hiring local employment; however, the Work Permits Act prohibits employers from employing foreigners without a work permit granted by the Ministry of Labor. Some large multinationals have specific agreements with the government mandating hiring local employees.

There are no policies requiring that senior management and board of directors should be Surinamese nationals.

There are no excessively onerous visa, residence, or work permit requirements inhibiting foreign investors’ mobility. Foreigners with short-term business in Suriname can apply online for a e-visa at: https://suriname.vfsevisa.com/ . Business visas require a letter of introduction from the business the applicant will be working with in Suriname. Foreigners who want to work in Suriname first need to apply for a residency permit at the Ministry of Justice and Police, after which they can apply for a work permit at the Ministry of Labor. The free movement of artists, university graduates, media workers, musicians, and athletes of CARICOM origin is arranged through CSME regulations. CSME regulations also provide for the free movement for those seeking to establish or conduct business within the community.

There are no government/authority-imposed conditions on permission to invest. In practice, large foreign investments, especially in the extractives sector, require approval from the relevant Minister.

The government does not impose forced localization policies on foreign investors.

There are no enforcement procedures for performance requirements on investors.

The 2001 Investment Law authorizes the Minister of Finance to grant both tax and non-tax incentives for new investments and for the expansion of existing investments. Incentives for new investments are on a case-by-case basis at the discretion of the Ministry of Finance. Incentives are available for both domestic and foreign investors, but investors must apply for these incentives before the initial investment is made.

Foreign IT providers are not required to turn over source code and/or provide access to encryption.

There are no measures that prevent or unduly impede companies from freely transmitting customer or other business-related data outside the country’s territory.

There are no mechanisms used to enforce any rules on local data storage within the country.

Real Property

Interest in property is enforced. Mortgages and liens are common. Mortgages are registered with the Mortgage Office. However, no effective registration system exists for other types of liens.

Non-residents can request to lease land from the government if they have established a company under Surinamese law. However, the process from application to approval is lengthy.The percentage of land in Suriname that lacks a clear land title remains unknown. There is no sustained effort by the government to identify property owners and register land titles. Article 1-1 of the L-1 decree, Principles of Land Policy, states that “all land, to which others have not proven their right to ownership, is domain of the State.” Furthermore, Article 41 of the Surinamese constitution states that wealth and resources are property of the nation and shall be used to promote economic, social, and cultural development. There is no effective demarcation of substantial land claims by indigenous people in the interior. Unoccupied, legally-purchased property cannot be reverted to other owners, such as squatters.

Intellectual Property Rights

Suriname is a member of the WTO and the World Intellectual Property Organization (WIPO); however, it has not ratified the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement. Even though Suriname is party to multiple agreements, intellectual property rights (IPR) enforcement is weak. The current legal framework mentions protection of copyright, trademarks, and patents, but ;that legislation dates back to 1912 (amended in 2001). Although the National Assembly passed amendments to the Music Copyright Law of 1913 in March 2015, there is no enforcement. Infringement on rights and theft are not uncommon due to the absence of enforcement capacity. There is also no protection provided for industrial designs, utility models, geographical indications, layout designs of integrated circuits or undisclosed information.

No IPR-related laws or regulations have been enacted in the past year. A draft IPR bill has been pending since 2015. Currently, patents and copyrights must be registered abroad due to a lack of local legislation. In 2012, the Suriname Port Unit was established to improve port security and prevent the illegal use of sea containers in drug trafficking and transnational organized criminal activities, such as trafficking in chemicals used in the manufacture of drugs (precursors), smuggling of goods (including counterfeit goods), tax evasion and possible terrorist acts.

In 2012, the Suriname Port Unit was established to improve port security and prevent the illegal use of sea containers in drug trafficking and transnational organized criminal activities, such as trafficking in chemicals used in the manufacture of drugs (precursors), smuggling of goods (including counterfeit goods), tax evasion and possible terrorist acts.

Suriname is not mentioned in the United States Trade Representative’s Special 301 Report, nor is it named in the Notorious Markets List.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/

Capital Markets and Portfolio Investment

The government does not promote portfolio investment.

There is a small self-regulating stock market with eleven companies registered. It meets twice a month but does not have an electronic exchange. There is no effective regulatory system to encourage and facilitate portfolio investment. At present, Suriname is facing liquidity shortfalls.

Sufficient policies do exist to facilitate the free flow of financial resources.

As an IMF Article VIII member, Suriname has agreed to refrain from restrictions on payments and transfers for current international transactions.

Credit is allocated on market terms and at market rates. Foreign investors that establish businesses in Suriname are able to get credit on the local market, usually with a payment guarantee from the parent company. The private sector has access to a variety of credit instruments. Larger companies can obtain customized credit products. There is, however, a Central Bank regulation that limits a commercial bank’s credit exposure to a single client.

Money and Banking System.

The private sector has access to a variety of credit instruments. Larger companies can obtain customized credit products.

According to the IMF Article IV Consultation in 2019, the banking system faces pressing vulnerabilities. Based on the latest (July 2019) data, the capital adequacy ratio for the banking system stood at 10.5 percent (above the 10 percent minimum requirement), but non-performing loans in the banking system remained high (12.5 percent of gross loans), and profitability was low (0.7 percent return on assets). Deposit and loan dollarization remain high.

Total estimated assets of Suriname’s largest banks:

DSB Bank (annual report, 2018): USD 1,007 billion

Hakrin Bank (annual report 28, 2018): USD 627.6. million

Republic Bank Limited (2019 annual report, Suriname-based assets): USD 473 million. (The Republic Bank Limited of Trinidad and Tobago acquired Royal Bank of Canada’s Suriname holdings in 2015.)

Finabank (annual report, 2018): $269 million.

Suriname has a central bank system Foreign banks or branches are allowed to establish operations in Suriname. They are subject to the same measures and regulations as local banks. According to an IMF assessment in 2016, banks in Suriname are among those in the region that have lost their correspondent relationships. The IMF notes that though the loss of correspondent banking relationships has not reached systemic proportions, a critical risk still exists. The Central Bank admits that compliance regarding legislation and procedures is lacking, and that strengthening of enforcement is needed. According to the IMF’s Article IV Consultation report in 2019, there is a possibility of losing corresponding banking relationships given recent overseas investigations of potential money laundering via Suriname’s financial sector. The reputational risk to both local and foreign banks acting as their correspondents is substantial. Suriname is in the process of completing a National Risk Assessment to identify and assess the money laundering risks.

There are no restrictions for foreigners to open a bank account. Banks require U.S. citizens to provide the information necessary to comply with the Foreign Accounts Tax Compliance Act (FATCA).

Foreign Exchange and Remittances

Foreign Exchange

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with an investment, such as remittances of investment capital, earnings, loan or lease payments, or royalties. There can be shortages in the availability of U.S. cash dollars at local banks, which can affect businesses.

Funds associated with any form of investment can be freely converted into a usable currency at legal market clearing rates with the permission of the Foreign Exchange Commission. However, the criteria for obtaining permissions are opaque.

Suriname maintains an official exchange rate of 7.52 Surinamese dollars (SR to $1.) government also registers and supervises money exchanges called cambios, which offer parallel exchange rates. For much of 2019, those parallel rates exchange rate fluctuated between 8.40 to 8.65 SRD to $1. In March 2020, they reached as high as 14 to 16 SRD

Remittance Policies

There are no recent changes or plans to change investment remittance policies.

The waiting period on remittances can be relatively short for dividends; return on investments, interest, and principal on private foreign debt; lease payments; royalties; and management fees. The time needed to process the requests depends on the sector and the amount transferred. Transfers through the banking system can range from same day to one week waiting times, contingent upon approval by the Foreign Exchange Commission.Sovereign Wealth Funds

On May 4, 2017, the National Assembly passed legislation establishing a Sovereign Wealth Fund (SWF). Suriname does not participate in the International Forum of Sovereign Wealth Funds.

State owned enterprises (SOEs) operate in the oil, agribusiness, mining, communication, travel, energy, and financial sectors. SOEs provide little information regarding their operations. Only a few produce annual reports accessible to the public. Staatsolie, Suriname’s state-owned oil company, has publicly available audited accounts. As of 2020, all state-owned enterprises will be required to publish annual accounts. Several have been accused of fraud or corrupt practices.

There is no public list of SOEs.

SOEs receive advantages when competing in the domestic market. These include access to government guarantees and government loans otherwise unavailable to private enterprises. Additionally, SOEs have access to land and raw materials inaccessible to private entities.

The government does not yet adhere to the OECD Guidelines on Corporate Governance for SOEs.

Privatization Program

The GOS did announce a privatization program largely in the agricultural sector, but the only privatization was the state-owned banana company in 2014.

Foreign investors can participate in privatization programs. In 2014, the Belgium multinational UNIVEG acquired a 90 percent stake in the state-owned banana company through a public, international bidding process. The European Commission assisted with the bidding process. UNIVEG later pulled out of Suriname. As this is the only example of privatization within Suriname, no standard privatization or public bidding processes have been established by the GOS.

There is a growing awareness of expectations of standards for responsible business conduct (RBC) among consumers and producers. Historically, Alcoa’s subsidiary, Suralco, took the lead on RBC in Suriname, and large multinationals such as Newmont continue to be the largest proponents of RBC. Some larger, state-owned and local companies also model RBC, including Staatsolie, Surinam Airways, Telesur, and the Fernandes Group of Companies, which holds the distribution rights for Coca-Cola, and the McDonalds franchise rights.

The government has not taken systematic measures to encourage or promote RBC. Companies are allowed to develop their own policies and standards. The government does incorporate RBC in some of its partnerships and agreements with multinational firms. For example, recent agreements between Staatsolie and foreign companies for offshore drilling include stipulations regarding RBC. The government has no national point of contact or ombudsman for stakeholders to acquire information or raise concerns about RBC. The GOS has not conducted a National Action Plan on RBC and/or Business and Human Rights. It is not known if RBC policies are part of the government’s procurement decisions.

There have been no recent high-profile controversial instances of private sector impact on human rights, though indigenous land rights in the interior is an ongoing issue.

The Labor Inspection Department from the Ministry of Labor supervises and enforces the observance of legal regulations regarding the conditions of employment and the protection of employees performing duties. Laws were enforced only in the formal sectors. Labor inspectors did not make regular occupational safety and health inspections. The government is drafting consumer and environmental protection laws. In March 2020, the National Assembly passed an Environment Framework Law.

Currently there is no legislation for corporate governance and executive compensation standards to protect shareholders. The Act on Annual Accounts will require companies to publish annual accounts based on the International Financial Reporting Standards (IFRS) starting in 2020.

The Suriname Trade and Business Association has taken the lead in promoting RBC. The Suriname Conservation Foundation initiated a Green Partnership Program this year signed by 14 enterprises, 13 of which are local, to stimulate awareness about a green economy and nature preservation. So far, no incidents have been reported indicating that those monitoring and or advocating around RBC cannot work freely.

The host government has not encouraged adherence to the OECD Due Diligence Guidance for Responsible Supply Chain of Minerals from Conflict-Afflicted and High-Risk Areas. In March 2019, the government adopted legislation to join the Kimberley Process Certificate Scheme in order to become a member of the World Diamond Council Association.

Suriname became a member of the Extractive Industry Transparency Initiative on May 24, 2017. The 2016 and 2017 reports were recently made publicly available. There are no domestic transparency measures requiring the disclosure of payments made to governments and/or other RBC/BHR policies or practices.

Suriname’s legal code penalizes corruption, but there is virtually no enforcement. Government officials are occasionally removed from assignments, but convictions are rare. On September 1, 2017, parliament passed anti-corruption legislation, nearly 15 years after the initial draft bill was introduced to the National Assembly. As of May 2020, the President had not yet signed the measured into law, and the anti-corruption commission has not yet been installed. Suriname ranks on 70 out of 180 countries on the Corruption Index of Transparency International.

Existing laws that deal with corruption do not extend to family members of officials, or to political parties.

There are no laws or regulations to counter conflicts of interest in awarding contracts or government procurement. The government does not encourage or require private companies to establish internal codes of conduct prohibiting bribery of public officials.

The government does not encourage or require private companies to establish internal codes of conduct prohibiting bribery of public officials.

Local private companies do not use internal control, ethics, and compliance programs to detect and prevent bribery of government officials. Suriname has signed and ratified the Inter-American Convention against Corruption. Suriname has not yet signed and ratified the UN Convention against Corruption. Suriname is not a party to the OECD Convention on Combatting Bribery.

Suriname has signed and ratified the Inter-American Convention against Corruption. Suriname has not yet signed and ratified the UN Convention against Corruption. Suriname is not a party to the OECD Convention on Combatting Bribery.

There are no NGOs that focus exclusively on investigating corruption. U.S. firms have identified corruption as an obstacle to FDI. Corruption is believed to be most pervasive in government procurement, the awarding of licenses and concessions, customs, and taxation.

U.S. firms have identified corruption as an obstacle to FDI. Corruption is believed to be most pervasive in government procurement, the awarding of licenses and concessions, customs, and taxation.

Resources to Report Corruption

Fraud Department
Suriname Police Force
( Korps Politie Suriname)
Havenlaan, Paramaribo, Suriname
(597) 404-943

Since the restoration of democracy in 1987, Suriname has not seen politically motivated violence or civil disturbance.In July 2019, illegal goldminers damaged property at the Rosebel goldmine after the company’s security personnel fatally shot an illegal goldminer. The mine was subsequently closed for one month, and then reopened. Suriname is increasingly polarized politically, however past elections were considered to be free and fair by international observers.

In general, both skilled and unskilled labor is available in the local market. According to the IMF Article IV report the unemployment rate is around six percent. Foreign workers are mainly active in the extractive industries and agricultural sector. Not only Haitians, but also an influx of Cubans entered the workforce and are active in several sectors for lower wages. Documented foreign workers are protected by labor laws. The unemployment rate in 2019 was approximately 6.17 percent. An estimated 15 percent of the working-age population worked in the informal economy.

Heavy equipment operators, welders, and other skilled workers in the extractive industries are in high demand. In recent years, Suriname recruited physicians and ER nurses from the Philippines to work in hospital emergency rooms. Because of the economic downturn in 2015/2016, the majority of these workers have left the country, resulting in a shortage of nurses and medical staff. Since 2005, Suriname has welcomed Cuban medical professionals on a rolling basis. In March 2020, Cuba sent 20 doctors and 30 nurses to Suriname to assist with the government’s COVID-19 response.

There are no policies that require the hiring of nationals; however, the Work Permits Act prohibits employers from employing foreigners without a work permit granted by the Ministry of Labor.

Legislation makes it difficult for employers to respond to fluctuating market conditions. The Dismissal Permits Act prohibits employers from dismissing employees without permission from the Ministry of Labor. Collective redundancy for organizational or economic reasons is permitted in cases such as the closure or decline of a business.

Generally, when an employee is laid off, unions negotiate with the employer regarding a package and duration of social benefits. Labor organizations sometimes object to work based on contracts as opposed to full time, ongoing employment.

Labor laws are not waived to attract or retain investment. As Suriname has no special economic zones, foreign trade zones, or free ports with alternative labor policies, all entities are subject to existing legislation.

Collective bargaining agreements are widespread in both the private and public sector. Data regarding the percentage of the economy covered by collective bargaining agreements is unavailable. Employees of most large multi-national firms are unionized.

Labor dispute mechanisms are in place and freely used for mediation and arbitration.

Strikes that pose an investment risk are rare.

Suriname is a member of the International Labor Organization and recognizes international labor law in its domestic legislation. In 2018, Suriname made a moderate advancement in efforts to eliminate the worst forms of child labor. The government ratified International Labor Organization Convention 138 concerning the minimum age for admission to employment, acceded to the Protocol to the Forced Labor Convention, and amended the Law on Labor for Children and Young People, raising the minimum age of work to 16 years.

Labor laws incorporate freedom of association and the right to organize and bargain collectively, along with prohibitions against forced labor, child labor, and employment discrimination. Existing legislation also provides for humane working conditions, occupational safety and health, and standardized working hours. The Labor Inspection Department supervises observance of labor abuses, health, and safety standards. Laws were effectively enforced only in the formal sectors.

Suriname qualifies for the Generalized System of Preferences (GSP). The GSP framework includes clauses on labor standards.

In June 2019, the National Assembly adopted the family protection law regarding maternity and paternity leave. In July 2019, the National Assembly approved an update of the Minimum Wage Act which set the minimum wage at SRD 8.4 per hour, effective July 10. Every two years, starting 2020, a National Wage Board will advise on a new minimum wage to the Minister of Labor.

There are no DFC programs.

The Peoples Republic of China provides significant investment financing in Suriname. In many cases, these projects are funded by China’s Export-Import Bank and completed by Chinese companies.

Government-funded investment opportunities are rarely publicly advertised.

Suriname signed an Investment Incentive Agreement with the United States in 1993.

* Source for Host Country Data: Central Bank of Suriname

Table 3: Sources and Destination of FDI
Note: Suriname does not release foreign direct investment data publicly. The IMF’s Coordinated Direct Investment Survey (CDIS) has no information on Suriname. There are no tax haven sources of inward FDI.

Table 4: Sources of Portfolio Investment
Note: Portfolio investment data are not available in Suriname on the IMF’s Coordinated Portfolio Investment Survey. The host government does not publish portfolio investment data.

Frankie Sturm
Economic Officer
(597) 556-700
SturmWF@state.gov

Policies Towards Foreign Direct Investment

The government of Trinidad and Tobago seeks foreign direct investment and has traditionally welcomed U.S. investors.

The U.S. Mission is not aware of laws or practices that discriminate against foreign investors, but some have seen the decision-making process for tenders and the subsequent awarding of contracts turn opaque without warning, especially when their interests compete with those of well-connected local firms.

InvesTT is TT’s investment promotion agency that assists investors through the process of setting up a business and provides aftercare services once established. Specifically, it provides market information; offers advice on accessing investment incentives; and assists with regulatory and registry issues; property and location services; creation of business linkages; problem solving; and advocacy to the government.  The TT International Financial Center is another investment promotion agency whose mission is to attract and facilitate foreign direct investment in the financial services sector.

While Trinidad and Tobago prioritizes investment retention, the U.S. Mission is not aware of a formal, ongoing dialogue with investors, either through an Ombudsman or formal business roundtable.

Limits on Foreign Control and Right to Private Ownership and Establishment

Both foreign and domestic private entities have the right to establish and own business enterprises and engage in all forms of remunerative activity.

Under the Foreign Investment Act of 1990, a foreign investor is permitted to own 100 percent of the share capital in a private company. A license is required to own more than a 30 percent of a public company.

The U.S. Mission is not aware of any sector-specific restrictions to U.S. investors.

TT maintains an investment screening mechanism for specific projects that have been submitted for the purpose of accessing sector-specific incentives, such as for those offered in the tourism industry.

Other Investment Policy Reviews

The World Trade Organization conducted a trade policy review for Trinidad and Tobago in 2019: https://www.wto.org/english/tratop_e/tpr_e/tp488_e.htm 

Business Facilitation

The government’s business facilitation efforts focus primarily on investor services (helping deal with rules and procedures) through its investment promotion agency and trying to make the rules more transparent and predictable overall.  However, more work needs to be done to achieve efficient administrative procedures and dispute resolution.  Trinidad and Tobago ranks 158th of 190 countries for registering property, 174th for enforcing contracts, and 166th for payment of taxes in the World Bank’s Doing Business 2020 report, representing a deterioration of indicators that reflect a difficulty of doing business.

The business registration website is www.ttbizlink.gov.tt.  The process is clear but is not complete, as payments cannot be done online and aspects of the process must be completed in person.  Foreign companies can use the website. The agencies with which a company must typically register include:

• Companies Registry, Ministry of Legal Affairs
• Board of Inland Revenue
• National Insurance Board
• Value Added Tax (VAT Office, Board of Inland Revenue)

The Global Enterprise Registration Network (GER) gives the TT business registration website a below-average score of 3 out of 10 for its single electronic window and 4.5 out of 10 for providing information on how to register a business.  The inability to make online payments, submit certificates online, and engage in simultaneous requests are the three main reasons for the low score.  A feedback mechanism allowing users to communicate with authorities is a strength of the TT business registration website.  According to GER, two areas for improvement are:

• Development of an online payment portal
• Provision of online certificates

Business registration requires completion of seven procedures over a period of 10 days.

Outward Investment

The host government does not promote or incentivize outward investment.

The host government does not restrict domestic investors from investing abroad.

TT has bilateral investment treaties (BIT) with Canada, China, France, Germany, Guatemala, India, Korea, Mexico, Spain, Switzerland, United Kingdom and the United States. TT has signed free trade agreements with the following countries, either bilaterally or as a part of CARICOM: Costa Rica, Cuba, Dominican Republic, Panama, and Venezuela. TT is not currently engaged in any BIT or FTA negotiations.

A bilateral taxation treaty with the United States took effect in 1970: https://www.irs.gov/pub/irs-trty/trinidad.pdf .  The Trinidad and Tobago government is in the process of modernizing its tax collection regime with the establishment of a new central revenue authority.  There are no ongoing systemic tax disputes between the government and foreign investors or other taxation issues of general concern to U.S. investors.

Transparency of the Regulatory System

Legal, regulatory, and accounting systems are generally transparent and consistent with international norms.

There are no informal regulatory processes managed by non-governmental organizations or private sector associations.

Rule-making and regulatory authority exist within the ministries and regulatory agencies at the national level. The government consults frequently, but not always, with international agencies and business associations in developing regulations.  The government submits draft regulations to parliament for approval.  The process is the same for each ministry.

Accounting, legal, and regulatory procedures are transparent and consistent with international norms.  IFRS standards are required for domestic public companies.

Proposed laws and regulations are often published in draft form for public comment, though there is no legal obligation to do so.  The government solicits private sector and business community comments on proposed legislation.

All draft bills and regulations are printed in the official gazette, and an electronic version is available (listed below).  The content is usually the actual draft text.

www.news.gov.tt/content/e-gazette# 

www.ric.org.tt ;

www.ttparliament.org 

The U.S. Mission is not aware of an oversight or enforcement mechanism that ensures the government follows administrative processes.

There has not been any announcement regarding reforms to the regulatory system, including enforcement, since the last ICS report.  Regulatory reform efforts announced in prior years, such as the mechanism to calculate and collect property tax and the establishment of the revenue authority, have not been fully implemented.

Establishment of the revenue authority is intended to increase collections and streamline the system for paying taxes.

At present, regulatory enforcement mechanisms are usually a combination of moral suasion and the use of applicable administrative, civil or criminal sanctions.  The enforcement process is not legally reviewable.

Regulation is usually reviewed based on scientific- or data-driven assessments.  Scientific studies or quantitative analyses are not made publicly available.  Public comments received by regulators are generally not made public.

Public finances and debt obligations are transparent and publicly available on the central bank website

International Regulatory Considerations

Trinidad and Tobago is not part of a regional economic block, though it is part of the Caribbean Community (CARICOM), a regional trading bloc that gives duty-free access to member goods, free movement to some members and establishes common treatment of non-members on specific issues.  The Caribbean Single Market and Economy (CSME) is an initiative currently being explored by CARICOM that would eventually integrate its member-states into a single economic unit.  When fully completed, the CSME would succeed CARICOM.

Legal, regulatory, and accounting systems are generally consistent with United Kingdom standards.

The government has not consistently notified the World Trade Organization (WTO) Committee on Technical Barriers to Trade (TBT) of draft technical regulations.

Legal System and Judicial Independence

TT’s legal system is based on English common law.  Contracts are legally enforced through the court system.

The country has a written commercial law.  There are few specialized courts, making the resolution of legal claims time consuming.  An industrial court exclusively handles cases relating to labor practices but also suffers from severe backlogs and is widely seen to favor claimants.

Civil cases of less than $2,250 are heard by the Magistrate’s Court.  Matters exceeding that amount are heard in the High Court of Justice, which can grant equitable relief.  There is no court or division of a court dedicated solely to hearing commercial cases.

TT’s judicial system is independent of the executive and the judicial process is competent, procedurally and substantively fair, and reliable, although very slow.  According to the World Bank’s Doing Business 2020 report, Trinidad and Tobago ranks 174 of 190 in ease of enforcing contracts, and its court system requires 1,340 days to resolve a contract claim, nearly double the Latin American and Caribbean regional average.

Decisions may be appealed to the Court of Appeal in the first instance.  The United Kingdom Privy Council Judicial Committee is the final court of appeal.

Laws and Regulations on Foreign Direct Investment

TT’s judicial system respects the sanctity of contracts and generally provides a level playing field for foreign investors involved in court matters.  Due to the backlog of cases, however, there can be major delays in the process.  It is imperative that foreign investors seek competent local legal counsel.  Some U.S. companies are hesitant to pursue legal remedies, preferring to attempt good faith negotiations in order to avoid an acrimonious relationship that could harm their interests in the country’s small, tight-knit business community.

There is no “one-stop-shop” website for investment providing relevant laws, rules, and procedures.  Useful websites to help navigate foreign investment laws, rules, and procedures are:

http://www.legalaffairs.gov.tt 

https://www.rgd.legalaffairs.gov.tt 

http://www.tradeind.gov.tt 

Competition and Anti-Trust Laws

The Fair-Trading Commission is responsible for promoting and maintaining fair competition in the domestic market.  It is tasked with investigating the various forms of anti-competitive business conduct set out in the Fair-Trading Act. Legislation operationalizing this agency in 2006 was not proclaimed by the president until February 2020, so the agency is untested with regard to will and capacity to fulfill its mission.

Expropriation and Compensation

The government can legally expropriate property based on the needs of the country and only after due process including adequate compensation, generally based on market value.  Various pieces of legislation make provisions for compulsory licensing in the interest of public health or intellectual property rights.

The U.S. Mission is not aware of any direct or indirect expropriation actions since the 1980s.  All prior expropriations were compensated to the satisfaction of the parties involved.  Energy sector contacts occasionally describe the tax regime as confiscatory, pointing to after-the-fact withdrawal or weakening of tax incentives offered to entice investment once investment occurs.

Claimants did not allege a lack of due process in prior expropriation cases.

Dispute Settlement

ICSID Convention and New York Convention

TT is a party to the International Centre for the Settlement of Investment Disputes (ICSID Convention) and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York convention).

Local courts recognize and enforce foreign arbitral awards according to chapter 20 of the Arbitration (Foreign Arbitral Awards) Act 1996.

Investor-State Dispute Settlement

The bilateral investment treaty between the United States and TT recognizes binding arbitration of investment disputes.

The U.S. Mission is not aware of any claims by U.S. investors under the bilateral investment treaty with the United States.

The U.S. Mission is unaware of any disputes involving U.S. or other foreign investors over the past 10 years.

There is no history of extrajudicial action against foreign investors.

International Commercial Arbitration and Foreign Courts

Some of the available types of alternative dispute resolution include mediation and arbitration.  The Civil Proceedings Rules encourage parties to make reasonable attempts to resolve their disputes amicably with litigation as a last resort. Mediation and arbitration are most commonly used.

There is a domestic dispute resolution center that offers arbitration services.  Domestic legislation, the Arbitration Act of 1939, is based on early English arbitration legislation and is not modeled on internationally accepted regulations.

The U.S. Mission has no records of any investment disputes involving an SOE.

Bankruptcy Regulations

Creditors have the right to be notified within 10 days of the appointment of a receiver and to receive a final report, a statement of accounts, and an assessment of claim.  Claims of secured creditors are prioritized under the Bankruptcy Act.  No distinction is made between foreign and domestic creditors or contract holders.  Bankruptcy is not criminalized.

The World Bank ranked TT 83rd of 190 countries in resolving insolvency in its Doing Business 2020 report.  This reflects TT’s recovery rate (cents on the dollar), which is worse than the regional average, and cost as a percentage of estate.

Investment Incentives

Investment incentives include the following: exemption from import duties and customs duties; tax credits and deferrals; cash refunds; carry-over of losses; and access to loans.  These are available equally to foreign and domestic investors, but delays in cash refund payments are a frequent complaint of those due them.  Additional information is available on the following websites:

https://www.finance.gov.tt/mof-investment-incentives-in-trinidad-and-tobago/ 

www.investt.com 

The government sometimes jointly finances foreign direct investment projects, but it not common.  One recent example was the government-driven proposal for a Sandals resort in Tobago, for which the government would provide financing for the construction of the development. (This deal eventually fell through.)

Foreign Trade Zones/Free Ports/Trade Facilitation

The Free Zones Act of 1988 (last amended in 1997) established the TT Free Zones Company (TTFZ) to promote export development and encourage both foreign and local investment projects in a relatively bureaucracy-free, duty-free, and tax-free environment.  Foreign owned firms have the same investment opportunities as Trinidad and Tobago entities.  There are currently 15 approved enterprises located in eight free zones.  The majority are located within a multiple-user site in north-central Trinidad, but the minister of trade and industry can designate any suitable area in TT as a free zone.

Free zone enterprises are exempt from customs duties on capital goods, parts, and raw materials for use in the construction and equipping of premises and in connection with the approved activity; import and export licensing requirements; land and building taxes; work permit fees; foreign currency and property ownership restrictions; capital gains taxes; withholding taxes on distribution of profits and corporation taxes or levies on sales or profits; VAT on goods supplied to a free zone; and duty on vehicles for use only within the free zone.

A corporation tax exemption for entities that qualify for free zone status is also in force.  Application to carry out an approved activity in an existing free zone area is made on specified forms to the TTFZ.

Free zone activities that qualify for approval include manufacturing for export, international trading in products, services for export, and development and management of free zones.  Activities that may be carried on in a free zone but do not qualify as approved activities include exploration and production activities involving petroleum, natural gas, or petrochemicals.  For more information, please review the following website: http://ttfzco.com/ 

Performance and Data Localization Requirements

The government does not mandate—although it strongly encourages, through negotiable incentives—projects that generate employment and foreign exchange; provide training and/or technology transfer; boost exports or reduce imports; have local content; and generally contribute to the welfare of the country.

The government does not mandate that locals be recruited to senior management and boards of directors.

Several foreign firms have encountered inconsistencies leading to long delays in the issuance of long-term work permits, but there are no explicit, onerous requirements.

There are no government/authority-imposed conditions on permission to invest.

There are no forced localization requirements.

There are no performance requirements, and thus no enforcement procedures.  There is no indication of an intention to implement across-the-board performance requirements.

Investment incentives are uniform for domestic and foreign investors but offered on a case-by-case, vice across-the-board, basis.

There are no requirements for foreign IT providers to turn over source code and/or provide access to encryption.

There are no measures that prevent or restrict companies from freely transmitting customer or other business-related data outside the country.

There are no rules on local data storage within Trinidad and Tobago.

Real Property

Property rights and interests are enforced in court.  Mortgages and liens exist.  TT has a dual system of land titles, the old common law system and the registered land title system governed by the Real Property Act of 1946.  Nearly 80 percent of land in TT remains under the more complicated common law system, which is not reliable for recording secured interests.

The Foreign Investment Act of 1990 governs the acquisition of any interest in land by foreign investors. It states that foreign investors wishing to acquire land larger than five acres must obtain a license from the Ministry of Finance.  Licenses are generally granted in practice per the criteria provided here: https://www.finance.gov.tt/wp-content/uploads/2014/05/51.pdf .

It is not clear what proportion of land does not have clear title.  The government does not make a defined effort to identify property owners and register land titles.

In the World Bank’s Doing Business 2020 report, Trinidad and Tobago ranked 158 out of 190 countries in ease of registering property.  Reasons for the poor score include the number of procedures required (more than the regional average), the length of time required (more than the regional average) and the cost of registering property as a percentage of the property value.

Property ownership can revert to squatters if they can prove exclusive possession of another’s land, without permission, for at least 16 years in the case of private lands and 30 years on State lands.

Intellectual Property Rights

Trinidad and Tobago’s  intellectual property rights (IPR) legal structure is strong, but enforcement is generally weak.  Infringement on rights and theft is common.

Trinidad and Tobago is a member of the World Intellectual Property Organization (WIPO).  In 2019, Trinidad and Tobago acceded to four intellectual property treaties: 1) the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations; 2) the Singapore Treaty on the Law of Trademarks; 3) the Marrakesh Treaty to Facilitate Access to Published Works by Visually Impaired Persons and Persons with Print Disabilities; and 4) the Beijing Treaty on Audiovisual Performances.  Each of these offers additional opportunity for international intellectual property  rights-holders to enforce their rights  in Trinidad and Tobago courts.  Legislation necessary to accede to the 1989 Madrid Protocol on Trademarks has been pending since 2015, and implementing regulations remain in drafting for the 2000 Patent Law Treaty.

Trinidad and Tobago does not track seizures of counterfeit goods.  At its May 2019 WTO Trade Policy Review, it reported one seizure in 2018.  The country has prosecuted IPR violations in the past, but such prosecutions are uncommon.

TT returned to the United States Trade Representative Special 301 Report’s Watch List in 2020.  Challenges concern widespread copyright infringement and the country’s lack of institutional commitment to enforce IPR.

Trinidad and Tobago is not included in the Notorious Markets List..

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/

Capital Markets and Portfolio Investment

The government welcomes foreign portfolio investment.

TT has its own stock market and has an established regulatory framework to encourage and facilitate portfolio investment.  There is enough liquidity in the markets to enter and exit sizeable positions.

Existing policies facilitate the free flow of financial resources into the product and factor markets.

The government and central bank respect IMF article VIII by refraining from restrictions on payment and transfers for current international transactions.  Shortages of foreign exchange, exacerbated by the government’s maintenance of the local currency at values higher than those which the market would bear, however, cause considerable delays in payments and transfers for international transactions.

A full range of credit instruments is available to the private sector.  There are no restrictions on borrowing by foreign investors, who are able to access credit.  Credit is allocated on market terms, but interest rates tend to be higher for foreign borrowers.

Money and Banking System

Banking services are widespread throughout urban areas, but penetration is significantly lower in rural areas.

The banking sector is healthy.

In 2019, the estimated total assets of Trinidad and Tobago’s largest banks was $21.9 billion.

TT has a central bank system.

Foreign banks may establish operations in TT provided they obtain a license from the central bank.  Trinidad and Tobago has lost correspondent banking relationships in the past three years.  The U.S. Mission is not aware of any current correspondent banking relationships that are in jeopardy.

There are no restrictions on a foreigner’s ability to establish a bank account.

Foreign Exchange and Remittances

Foreign Exchange

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with an investment.

Shortages of foreign exchange, exacerbated by the government’s maintenance of the local currency at values higher than those which the market would bear, cause considerable delays in conversion into world currencies.  Businesses continue to report a cumbersome bureaucratic process and a minimum three-month delay in such conversions.

The central bank intervenes to maintain an unofficial peg to the U.S. dollar, using a managed float in which the exchange rate fluctuates mildly day-to-day, and limits the availability of foreign currency.

Remittance Policies

While there are no recent changes or plans to change investment remittance policies to tighten or relax access to foreign exchange for investment remittances, commercial banks have enacted policies that limit access to foreign exchange due to national shortages, on guidance from the Ministry of Finance and the central bank.

Although there are no official time limitations on remittances, timeliness of remittances depends on availability of foreign currency.

Sovereign Wealth Funds

The value of TT’s Heritage and Stabilization Fund the fund as of April 2020 is approximately $5.9 billion, but a $1.1 billion withdrawal to support coronavirus-related economic measures is pending.  The fund invests in U.S. short duration fixed income, U.S. core domestic fixed income, U.S. core domestic equities, and non-U.S. core international equities.

The SWF follows the voluntary code of good practices known as the Santiago Principles. TT participates in the IMF-hosted International Working Group on Sovereign Wealth Funds.

None of the SWF is invested domestically.  There are no potentially negative ramifications for U.S. investors in the local market.

TT has 55 state-owned enterprises (SOEs), comprised of 42 wholly owned companies, eight majority-owned, and four in which the government has a minority share.  SOEs are in the energy, manufacturing, agriculture, tourism, financial services, transportation, and communication sectors.  Information on the total assets of SOEs, total net income of SOEs and number of people employed by SOEs is not available.  The Investments Division of the Ministry of Finance appoints directors to the boards of state enterprises, reportedly at the direction of the minister of finance.  SOEs are often informally or explicitly obligated to consult with government officials before making major business decisions.  According to TT’s constitution, the government is entitled to:

• exercise control directly or indirectly over the affairs of the enterprise
• appoint a majority of directors of the board of directors of the enterprise
• hold at least 50 per cent of the ordinary share capital of the enterprise

A published list of SOEs for 2020 can be found here: https://www.finance.gov.tt/2019/10/07/state-enterprises-investment-programme-2020/ .

In sectors that are open to both the private sector and foreign competition, SOEs are sometimes favored for government contracts, which might negatively impact U.S. investors in the market.

The country has not adhered to the OECD corporate governance guidelines for SOEs.

Privatization Program

TT does not have a privatization program in place, but the government has issued initial public offerings of various state-owned companies to obtain revenue, primarily in the finance and energy sectors.

Foreign investors can participate in the initial public offerings of SOEs.

The purchase of initial public offering shares on past occasions was open to the public, easy to understand, non-discriminatory, and transparent.  For example: https://ngc.co.tt/media/news/ngl-initial-public-offering-brokerage-details/ 

There is general awareness of expectations of, and standards for, responsible business conduct (RBC), including obligations to proactively conduct due diligence to ensure businesses are doing no harm, including with regards to environmental, social, and governance issues.

The government has not put forward a clear definition of responsible business conduct, nor does it have specific policies to promote and encourage it.  The government has not conducted a national action plan on RBC, nor does it currently factor it into procurement decisions.

There have not been any high-profile, controversial instances of private sector impact on human rights.

TT has laws to ensure protection of labor rights, consumers, and the environment.  Enforcement, however, is lacking due to staffing shortages, capacity issues, and a bureaucratic judiciary.

Government, in collaboration with civil society, created the TT Corporate Governance Code, which incorporates governance, accounting, and executive compensation standards to protect shareholders.  The code, however, is not mandatory.

The Caribbean Corporate Governance Institute is a not-for-profit organization headquartered in Trinidad and Tobago that freely advocates for responsible business conduct and improved corporate governance practices in the Caribbean.

The government does not encourage adherence to the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Afflicted and High-Risk Areas.  There are no domestic measures requiring supply chain due diligence for companies sourcing minerals originating from conflict-affected areas.

As a member of the EITI, the government publicly declares annually all revenues received from companies engaged in the extractive industries.  The companies, in turn, publicly declare payments to the government.

Various pieces of legislation address corruption of public officials:

• The Integrity in Public Life Act requires public officials to disclose assets upon taking office and at the end of tenure.
• The Freedom of Information Act gives members of the public a general right (with specified exceptions) of access to official documents of public authorities. The intention of the act was to address the public’s concerns of corruption and to promote a system of open and good governance.  In compliance with the act, designated officers in each ministry and statutory authority process applications for information.
• The Police Complaints Authority Act establishes a mechanism for complaints against police officers in relation to, among other things, police misconduct and police corruption.
• The Prevention of Corruption Act provides for certain offences and punishment of corruption in public office.

The laws are non-discriminatory in their infrequent application.  Effectiveness of these measures has been limited by a lack of thorough enforcement.

The laws do not extend to family members of officials or to political parties.

TT does not have laws or regulations to counter conflicts of interest in awarding contracts or government procurement.

The government has been a party to the development of corporate governance standards (non-binding) to encourage private companies to establish internal codes of conduct that, among other things, prohibit bribery of public officials.

Some private companies, particularly the larger ones, use internal controls and compliance programs to detect and prevent bribery of government officials, though this is not a government requirement.

Trinidad and Tobago adheres to the UN Anticorruption Convention.

There are no protections for NGOs involved in investigating corruption, but investigations are not feared since corrupt actors are rarely punished.

U.S. firms often say corruption is an obstacle to FDI, particularly in government procurement, since TT’s procurement processes are not transparent.

Resources to Report Corruption

Name: Mr. Justice Melville Baird
Title: Chairman
Organization: The Integrity Commission
Address: P.O. Box 1253, Port of Spain
The Integrity Commission of Trinidad and Tobago Level 14,
Tower D, International Waterfront Centre, 1A Wrightson Road, Port of Spain
Telephone number: 868-623-8305
Email address: registrar@integritycommission.org.tt

Name: Mr. Dion Abdool
Title: Chairman
Organization: Trinidad and Tobago Transparency Institute (local chapter of Transparency International)
Address: Unit 4-12, Building 7, Fernandes Industrial Centre, Laventille
Telephone number: 868-626-5756
Email address: admin@transparency.org.tt

While non-violent demonstrations occur on occasion, widespread civil disorder is not typical.  There have been no serious incidents of political violence since a coup attempt in 1990.

Subsequent to the closure of state oil firm Petrotrin in November 2018, which resulted in the lay-off of nearly 6,000 workers, there were reports of damage to installations.

Certain areas of TT are increasingly insecure due to a critical level of violent crime.

In 2019, the International Labor Organization estimated unemployment at 2.8 percent. That figure, however, is artificially low due to government make-work programs that absorb excess labor.  The labor market includes many skilled and experienced workers, and the educational level of the population is among the top 10 in North America, according to the Human Development Index, though there is a gap between official literacy statistics and functional literacy.  In 2019, youth unemployment rate (15-24 years of age) was estimated at 6.41 percent.

Agricultural employment accounts for 3.6 percent of total employment while employment in services accounts for over 60 percent.  The estimated non-agricultural workforce in the informal economy is 10 percent of the overall labor force.  Trinidad and Tobago’s workforce includes not only TT nationals but also citizens of 11 other CARICOM countries as part of the free movement of labor without the need to obtain a work permit.  In 2019, Trinidad and Tobago granted 16,523 “Venezuelan migrants” the right to work in the country for a period of one year under a temporary protective status.  The Minister of National Security granted the Venezuelan migrants an automatic 6 months extension in 2020.

Trinidad and Tobago is a net importer of expatriate labor, including doctors, nurses, construction workers, and extractive industry specialists.  There are surpluses of accountants and attorneys and shortages of unskilled workers for the hospitality, retail, and agriculture sectors.  The government subsidizes tertiary-level education for citizens whose income falls within a minimum range.  The Multi-Sector Skills Training Program provides training in construction and hospitality and tourism for eligible citizens of Trinidad and Tobago.  The government also encourages continuing learning opportunities for the disadvantaged via the Skills Training Program, which develops skills that can aid in the creation of home-based production of goods and services and employment generation.

There is no government policy requiring hiring of nationals, though it is encouraged, particularly in the energy sector.

There are no restrictions on employers adjusting employment to respond to fluctuating market conditions via severance.  Labor laws differentiate between layoffs and firing.  The Retrenchment and Severance Benefits Act provides guidance on who is entitled to receive what based on specific circumstances.  Severance pay is usually only paid to retirees and workers who have been made redundant.  An employer is not required to pay severance to workers if everyone is severed, since the business is being closed.  If, however, only a portion of the workforce is rendered redundant, the employer must pay severance.  Unemployment insurance does not exist for workers who have been laid off for economic reasons, but programs designed to help job seekers get employed as quickly as possible are available.  Due to the COVID-19 pandemic, the government instituted a 3-6-month unemployment benefit program for those laid off.

Labor laws are not waived in order to attract or retain investment.  There are no separate labor law provisions for special economic zones, trade zones, or free ports.

Collective bargaining is common, with approximately 15 percent of the population covered by collective bargaining agreements.  Government workers, including civil servants, police officers, firefighters, military personnel, and staff in several state-owned enterprises, are covered by collective bargaining agreements.  Unions are also quite active in the energy, steel, and telecommunications industries.  Collective bargaining takes place between the firm and the recognized majority union rather than on an industry-wide basis.  The government as an employer also bargains collectively.  The process of collective bargaining is regulated by the Industrial Relations Act.  There are close to 30 active, independent labor unions in TT.

The Industrial Relations Act (IRA) provides for dispute resolution through an industrial court in instances where the issue cannot be resolved by collective bargaining or through conciliation efforts by the Ministry of Labor.

There was no strike in the past year that posed an investment risk.

The ILO has not identified any compliance gaps in law or practice regarding international labor standards that may pose a reputational risk to investors.  The government does not have a labor inspectorate system to identify and remediate labor violations, but the industrial court investigates and prosecutes unfair labor practices, such as harassment and/or improper dismissal of union members.

There were no new labor related laws or regulations enacted or in draft over the last year.

As a high-income country, Trinidad and Tobago is ineligible for DFC programs.

OPIC has a bilateral agreement with Trinidad and Tobago.

* Source for Host Country Data: Ministry of Finance.

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Name: Matt Ciesielski
Title:   Economic and Commercial Officer
Address of Mission: 15 Queen’s Park West, Port of Spain. Trinidad and Tobago
Telephone Number: +1 (868) 622-6371 ext. 5926
Email address: poscommercial@state.gov