Transparency of the Regulatory System
Antigua and Barbuda uses transparent policies and effective laws to foster competition and establish clear rules for foreign and domestic investors in the areas of tax, labor, environment, health, and safety. The Government of Antigua and Barbuda publishes laws, regulations, administrative practices and procedures of general application and judicial decisions that affect or pertain to investments or investors in Antigua and Barbuda. Where the national government establishes policies that affect or pertain to investments or investors that are not expressed in laws and regulations or by other means, the national government will make them publicly available.
Rulemaking and regulatory authority lies with the Bicameral Parliament of the Government of Antigua and Barbuda. The Parliament has two chambers: the House of Representatives has 19 members, 17 members elected for a five year term in single-seat constituencies, one ex-officio member and one Speaker. The Senate has 17 appointed members.
All regulations that relate to foreign investment into Antigua and Barbuda are governed by the relevant National Laws of Antigua and Barbuda. These laws are developed within the respective Ministries and drafted by the Ministry of Legal Affairs. These laws are enforced by the requisite Ministry of the Government of Antigua and Barbuda. The attraction of Foreign Direct Investment is governed principally through laws overseeing the Antigua and Barbuda Investment Authority and the Citizenship by Investment Program. The National Laws of Antigua and Barbuda are available online at http://laws.gov.ag/new/index.php . This website contains the full text of laws already in force, as well as those currently being proposed in Parliament.
Although, some draft bills are not subject to public consultation, input from various stakeholder groups is enlisted in the formulation of law. The process is detailed at: http://www.laws.gov.ag/makinglaws.htm . 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 accounting profession.
The Office of the Ombudsman is a Constitutional provision established to guard against excesses by government officers in the performance of their duties. The Office of the Ombudsman is independent and is not subject to the direction or control of any other person or authority. The function of the Ombudsman is to investigate any complaint relating to any decision or recommendation made or any act done or omitted by any officer of the Government or statutory body in any case in which a member of the public claims to be aggrieved, or appears to the Ombudsman to be the victim of an injustice as a result of the exercise of the administrative function of that officer or body.
Separately, because diversification of the economy remains a priority for the Government of Antigua and Barbuda, the Tourism and Business Special Incentives Act (2013) was extended for an additional two years to 2018. The extension was meant to facilitate the further development of other key sectors, such as the creative industries, yachting and marine services and information and computer technology-enabled services.
Regulations are developed nationally and regionally. At the national level, the requisite ministry reviews and documents the desired legal authority that would enable it to effectively perform at the desired levels to reach optimum development objectives. These reviews are then submitted to the Ministry of Legal Affairs for the preparation of the draft legislation. Subsequently, the Ministry of Legal Affairs reviews all agreements and legal commitments (national, regional and international) to be undertaken by Antigua and Barbuda before they are finalized. The Antigua and Barbuda Investment Authority has the main responsibility for investment supervision, whereas the Ministry of Finance and Corporate Governance monitors investments to collect information for national statistics and reporting purposes.
Antigua and Barbuda’s membership in regional organizations, particularly the Organization of Eastern Caribbean States and its Economic membership in regional organizations, particularly the Organization of Eastern Caribbean States and its Economic Union, commits the state to implement all appropriate measures to ensure the fulfillment of its various treaty obligations. For example, the new 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 Eastern Caribbean Currency Union, although there are some minor differences in implementation from country to country.
The enforcement mechanisms of these regulations include penalties and other sanctions. The Antigua and Barbuda Investment Authority can revoke an issued Investment Certificate if the holder fails to comply with certain stipulations detailed in the Act and its regulations. Stakeholder organizations are encouraged to support and contribute to the standards development process by participating in technical committees and remarking on drafts that are available for comment. These organizations support the standards development process by presenting their members’ interests, expert opinions and analysis to ensure standards are sound and effective.
International Regulatory Considerations
As a member of the OECS and the Eastern Caribbean Economic Union, Antigua and Barbuda subscribes to 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, Antigua and Barbuda is obligated to implement regionally developed regulations, such as legislation passed under Organization of Eastern Caribbean States Authority, unless specific concessions are sought.
The Antigua and Barbuda Bureau of Standards is a statutory body established under the Standards Act of 1987 to prepare and promulgate standards in relation to goods, services, processes and practices. As a signatory to the WTO Agreement on the Technical Barriers to Trade, Antigua and Barbuda, through the Antigua and Barbuda Bureau of Standards, is therefore obligated to harmonize all national standards to international norms to avoid creating technical barriers to trade.
Legal System and Judicial Independence
Antigua and Barbuda bases its legal system on the British common law system. The Attorney General, the Chief Justice of the Eastern Caribbean Supreme Court, junior judges, and magistrates administer justice in the country. 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 matters and makes determinations on the interpretation of the Constitution. Appeals are made in the first instance to the Eastern Caribbean Supreme Court, an itinerant court that hears appeals from all Organization of Eastern Caribbean States members. Final appeal is to the Judicial Committee of the Privy Council of the United Kingdom. A referendum to decide whether or not the country should remain subject to the Privy Council or turn to the Trinidad-based Caribbean Court of Justice as its final court of appeal is expected to take place sometime in 2017.
The Caribbean Court of Justice is the regional judicial tribunal, established in 2001 by the Agreement Establishing the Caribbean Court of Justice. The Caribbean Court of Justice has original jurisdiction to interpret and apply the Revised Treaty of Chaguaramas.
Antigua and Barbuda is party 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. Antigua and Barbuda brought a case against the United States before the WTO concerning the cross-border supply of gambling and betting services. The WTO ruled in favor of Antigua and Barbuda, but agreement on settlement terms remains outstanding.
Laws and Regulations on Foreign Direct Investment
The Antigua and Barbuda Investment Authority provides guidance on the relevant laws, rules, procedures, and reporting requirements for investors. These can be obtained at http://www.theiguides.org/public-docs/guides/antiguabarbuda and http://investantiguabarbuda.org/ .
Citizenship by Investment
Under the Citizenship by Investment Program, foreign individuals can obtain citizenship in accordance with the Citizenship by Investment Act of 2013, which grants citizenship (without voting rights), to qualified investors. Program applicants are required to undergo a due diligence process before citizenship can be granted. The minimum that would entitle an investor to qualify is a USD $200,000 contribution to the National Development Fund for a family application for up to four persons, a real estate purchase valued at USD $400,000 or above, or a business investment of USD $1.5 million individually or at least USD $400,000 for a joint project. All applicants must also pay relevant government and due diligence fees, as well as a full medical certificate, a police certificate, and evidence of the source of funds. Further information is available at: http://www.cip.gov.ag/ .
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 Antigua and Barbuda. The OECS agreed to establish a regional competition body to handle competition matters within its single market. The draft OECS bill is with the Ministry of Legal Affairs for review.
Expropriation and Compensation
According to the Investment Authority Act of 2006, investments in Antigua and Barbuda will not be nationalized, expropriated or subject to indirect measures having an equivalent effect, except where any such measures are adopted for the public good and in accordance with due process of law, on a non-discriminatory basis and accompanied by prompt, adequate and effective compensation. Compensation in such cases will amount to the fair market value of the expropriated investment immediately before the expropriation or the impending expropriation became public knowledge, whichever is earlier. It shall include interest from the date of dispossession of the expropriated property until the date of payment. Compensation is required to be paid without delay, in convertible currency, and be effectively realizable and freely transferable.
There is an unresolved dispute regarding the expropriation of an American-owned property. In November 2015, the Government of Antigua and Barbuda (GOAB) paid the property owners the amount of USD $16 million towards the USD $41.7 million owed. While the property was sold in 2015, the Government of Antigua and Barbuda still owes accumulated interest on the property. The owner intends to continue battling the Government of Antigua and Barbuda in court until all monies are paid. For this reason, the U.S. government recommends continued caution when investing in real estate in Antigua and Barbuda.
Antigua and Barbuda is not a party to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States; however it is a member of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the New York Arbitration Convention. International or national arbitration may be used if specified in contracts between private parties. The Arbitration Act Cap. 33 (1975) is the main legislation which governs arbitration in Antigua and Barbuda. It adheres to the New York Arbitration Convention.
Investor-State Dispute Settlement
Investors are permitted to use national or international arbitration with regards to contracts entered into with the state. Antigua and Barbuda also has Bilateral Investment Treaties with the Federal Republic of Germany and the United Kingdom in which binding international arbitration of investment disputes is recognized. Antigua and Barbuda does not have a Bilateral Investment Treaty or a Free Trade Agreement with an investment chapter with the United States. U.S. Embassy Bridgetown is not aware of any current investment disputes in Antigua and Barbuda.
According to the World Bank’s 2017 Doing Business Report, dispute resolution in Antigua and Barbuda generally takes an average of 476 days. The slow court system and bureaucracy are widely seen as main hindrances to timely resolutions to commercial disputes. Antigua and Barbuda is ranked 35 out of 190 countries in resolving contracts in the World Bank Doing Business Report 2017. Through the Arbitration Act Cap.33 (1975), the local courts recognize and enforce foreign arbitral awards issued against the government.
International Commercial Arbitration and Foreign Courts
As mandated by the Arbitration Act Cap 33 (1975), alternative dispute mechanisms are available as a means for settling disputes between two private parties. Voluntary mediation or conciliation is also used in dispute resolution. The Arbitration Act mandates the legal recognition and enforcement of judgements of foreign courts by local courts. Thus, the High Court of Antigua and Barbuda recognizes and enforces foreign arbitral awards. The Eastern Caribbean Supreme Court’s Court of Appeal provides meditation on commercial contracts.
Under the Bankruptcy Act (1975), Antigua and Barbuda has a bankruptcy framework that grants certain rights to debtor and creditor. The World Bank’s 2017 Doing Business Report addresses the strength of the framework and its limitations in resolving insolvency in Antigua and Barbuda and ranked Antigua and Barbuda 124th of 190 countries in this area.