Transparency of the Regulatory System
Antigua and Barbuda seeks 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 House of Representatives has 19 members, of which 17 memberselected for a five-year term in single-seat constituencies, one ex-officio member, and one Speaker. The Senate has 17 appointed members.
Respective line ministries develop the relevant national laws and regulations, which are then drafted by the Ministry of Legal Affairs. Laws relating to the ABIA and the CBI program are the main laws relevant to FDI. The 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 parliament is currently considering.
Although, some draft bills are not subject to public consultation, input from various stakeholder groups may be considered. The process is detailed at:http://www.laws.gov.ag/makinglaws.htm . The government encourages stakeholder organizations to support and contribute to the legal development process by participating in technical committees and commenting on drafts.
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 constitution provides for the independent Office of the Ombudsman to guard against abuses of power by government officials. The Ombudsman is responsible for investigating complaints about acts or omissions by government officials that violate the rights of members of the public.
The ABIA has the main responsibility for investment supervision, and 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 OECS and its Economic Union, commits the state to implement all appropriate measures to fulfill its various treaty obligations. Therefore, the eight member states and territories of the ECCU tend to enact laws uniformly, although there may be some minor differences in implementation. The enforcement mechanisms of these regulations include penalties and other sanctions. The ABIA can revoke an issued Investment Certificate if the holder fails to comply with certain stipulations detailed in the Investment Authority Act and its regulations.
The government of Antigua and Barbuda has stated its commitment to achieving better development outcomes through improved transparency and accountability in the management of public finances. The government has developed a Medium-Term Debt Management Strategy (MTDS) (covering the period 2016-2020) aimed at minimizing debt servicing, budgetary costs, and risk exposure to government while making every effort to maintain debt at a sustainable level.
The government enacted the Miscellaneous Amendments Act 2018 in December 2018, which ensured a number of important international standards were reflected in national legislation. The government has also reduced the proportion of revenue required to pay the interest on government debt. The most recent Caribbean Financial Action Task Force (CFATF) Mutual Evaluation assessment found Antigua and Barbuda to be largely compliant.
The ECCB is the supervisory authority over financial institutions registered under the Banking Act of 2015.
International Regulatory Considerations
As a member of the OECS and the ECCU, 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 the authority of the OECS, unless it seeks specific concessions to do otherwise.
The Antigua and Barbuda Bureau of Standards is a statutory body that prepares and promulgates standards in relation to goods, services, processes, and practices. Antigua and Barbuda is a signatory to the World Trade Organization (WTO) Agreement on the Technical Barriers to Trade.
Antigua and Barbuda ratified the WTO Trade Facilitation Agreement (TFA) in November 2017. Ratification of the Agreement is an important signal to investors of the country’s commitment to improving its business environment for trade. The TFA is intended to improve the speed and efficiency of border procedures, facilitate trade costs reduction, and enhance participation in the global value chain. Antigua and Barbuda has already implemented a number of TFA requirements. A full list is available at:https://www.tfadatabase.org/members/antigua-and-barbuda/measure-breakdown.
The Advanced Cargo Information System (ACIS) is a CARICOM project that seeks to improve the capability to track cargo efficiently. Antigua and Barbuda is one of three regional pilot countries who have already enacted the enabling legislation. Antigua and Barbuda has fully implemented the Automated System for Customs Data (ASYCUDA). Importers are no longer required to produce a Certificate of Good Standing (Tax Compliance Certificate) for the importation of goods. This has reduced the time needed to clear goods. Legislative changes to the Customs Control and Management Act enabled the electronic processing of manifests.
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. 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 interpretation of the Constitution. Parties may appeal first to the Eastern Caribbean Supreme Court, an itinerant court that hears appeals from all OECS members. The final appellate authority is the Judicial Committee of the Privy Council of the United Kingdom.
The Caribbean Court of Justice (CCJ) has original jurisdiction to interpret and apply the Revised Treaty of Chaguaramas. Currently, Antigua and Barbuda is subject only to the original jurisdiction of the CCJ.
Antigua and Barbuda is a 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 ABIA provides guidance on the relevant laws, rules, procedures, and reporting requirements for investors. These are available at http://www.theiguides.org/public-docs/guides/antiguabarbuda and http://investantiguabarbuda.org/.
The government discontinued concessions provided under the Tourism and Business Special Incentives Act (2013) in 2018. The government is currently reviewing its concessions regime.
Citizenship by Investment
Under the CBI 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. Applicants are required to undergo a due diligence process before citizenship can be granted. The minimum contribution for investors under the CBI is a contribution of USD 100,000 to the National Development Fund for a family of up to four people and USD 125,000 for a family of five, with additional contributions of USD 15,000 per person for up to four additional family members. Additionally, foreign individuals may contribute USD 150,000 to the University of the West Indies (UWI) Fund for a family of up to four people. This contribution entitles one member of the family to a one year tuition-only scholarship at UWI. Individual applicants can also qualify for the program by buying real estate valued at USD 400,000 or more or making a business investment of USD 1.5 million. Alternatively, at least two applicants can propose to make a joint investment in an approved business with a total investment of at least USD 5 million. Each investor must contribute at least USD 400,000 to the joint investment. Until October 31, 2019, two applications from related parties can make a joint investment, with each applicant investing a minimum of USD 200,000 in order to qualify. CBI investors must own property for a minimum of five years before selling it. All applicants must also pay relevant government and due diligence fees, as well as providing 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 (CCC) to rule on complaints of anti-competitive cross-border business conduct. CARICOM competition policy addresses anti-competitive business conduct such as collusion 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. Antigua and Barbuda does not have any legislation regulating competition. 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.
In March 2019, the CCC preliminarily ruled that parts of a proposed sale of the Bank of Nova Scotia’s banking assets in nine countries in the Caribbean, including OECS member countries, to Republic Financial Holdings and life insurance operations in two other Caribbean countries to Sagicor Financial Corporation could have an anti-competitive impact in at least three member states. The CCC stated it intends to liaise with national competition authorities and sector regulators for preliminary examinations of the proposed sales at the national level. The CCC has promised to monitor the situation and provide further updates.
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 as necessary for the public good, in accordance with due process of law, on a non-discriminatory basis, and accompanied by prompt, adequate, and effective compensation. Compensation in such cases is the fair market value of the expropriated investment immediately before the expropriation or the impending expropriation became public knowledge, whichever is earlier. Compensation 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. Although the government of Antigua and Barbuda paid the former property owner a total of USD 39.8 million in compensation, it still owes interest payments of USD 20 million. In March 2019, a judge dismissed a case bought by the former property owners against the government for payment of the outstanding balance. However, the owners intend to appeal. For this reason, the industry recommends continued caution when investing in real estate in Antigua and Barbuda.
ICSID Convention and New York Convention
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. Private parties may use international or national arbitration if specified in contracts. 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 may use national or international arbitration to resolve contractual disputes with the state. Antigua and Barbuda also has Bilateral Investment Treaties with Germany and the United Kingdom that recognize binding international arbitration of investment disputes. 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.
Antigua and Barbuda ranks 34 out of 190 countries in enforcing contracts in the 2019 World Bank Doing Business Report. According to the report, dispute resolution in Antigua and Barbuda generally takes an average of 476 days. The slow court system and bureaucracy are widely seen as the main hindrances to timely resolutions to commercial disputes. Through the Arbitration Act, 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, alternative dispute mechanisms are available as a means for settling disputes between two private parties. Parties may also use voluntary mediation or conciliation. The Arbitration Act mandates the legal recognition and enforcement of judgments 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 debtors and creditors. The World Bank’s 2019 Doing Business Report addresses the strength of the framework and its limitations in resolving insolvency in Antigua and Barbuda. Antigua and Barbuda is ranked 132nd of 190 countries in this area.