Transparency of the Regulatory System
Jamaica’s regulatory systems are transparent and consistent with international norms. Proposed legislation is available for public review at japarliament.gov.jm, and submissions are generally invited from members of the public when there is a distinct policy shift or for sensitive changes. There is no law that requires the rulemaking body to solicit comments on proposed regulation and no timeframe for the length of a consultation period when it happens. Furthermore, the law does not require reporting on public consultations but the government presents the consultations directly to interested stakeholders in one unified report. Laws in effect are available at japarliament.gov.jm or moj.gov.jm. Companies interested in doing business in a particular sector should seek guidance from the relevant regulator(s), including the Office of Utilities Regulation (OUR) for utilities, the Bank of Jamaica (BOJ) for deposit taking institutions (DTIs) and the Financial Services Commission (FSC) for non-DTIs.
Jamaica is compliant with established benchmarks for public disclosure of its budget, the establishment and functioning of an independent and supreme audit body, and the award of contracts for natural resource extraction. Additionally, Jamaica’s Public Debt Management Act (PDMA) of 2012 has codified a gradual reduction in its contingent liability or Government Guaranteed Loans (GGL), which were 7.4 percent of GDP in 2017. The PDMA targets a three percent GGL-to-GDP ratio by 2027.
International Regulatory Considerations
The GOJ tends to adopt Commonwealth standards for its regulatory system, especially from Canada and the United Kingdom. In 2001, CARICOM member states established the Regional Organization for Standards and Quality (CROSQ) under Article 67 of the Revised Treaty of Chaguaramas. CROSQ is intended to harmonize regional standards to facilitate the smooth movement of goods in the common market. Jamaica is also a full member of the WTO and is required to notify all draft technical regulations to the WTO Committee of Technical Barriers to Trade (TBT).
Legal System and Judicial Independence
Jamaica has a common law legal system and court decisions are generally based on past judicial declarations. The Jamaican Constitution provides for an independent judiciary with a three-tier court structure. A party seeking to enforce ownership or contractual rights can file a claim in the Resident Magistrate or Supreme Court. Appeals on decisions made in these courts can be taken before the Court of Appeal and then to the Judicial Committee of the Privy Council in the United Kingdom. The Caribbean Court of Justice (CCJ), in its original jurisdiction, is the court of the 15-member Caribbean Community (CARICOM), but Jamaica has not signed on to its appellate jurisdiction.Jamaica does not have a single written commercial or contractual law and case law is therefore supplemented by the following pieces of legislation: (1) Arbitration (Recognition and Enforcement of Foreign Awards) Act; (2) Companies Act; (3) Consumer Protection Act; (4) Fair Competition Act; (5) Investment Disputes Awards (Enforcement) Act; (6) Judgment (Foreign) (Reciprocal Enforcement) Act; (7) Law Reform (Frustrated Contracts) Act; (8) Loans (Equity Investment Bonds) Act; (9) Partnership (Limited) Act; (10) Registration of Business Names Act; (11) Sale of Goods Act; (12) Standards Act; and, (13) Trade Act. The commercial and civil divisions of the Supreme Court have jurisdiction to hear intellectual property claims.
Jamaica enforces the judgments of foreign courts through: (1) The Judgment and Awards (Reciprocal Enforcement) Act; (2) The Judgment (Foreign) (Reciprocal Enforcement) Act; and, (3) The Maintenance Orders (Facilities for Enforcement) Act. Under these acts, judgments of foreign courts are accepted where there is a reciprocal enforcement of judgment treaty with the relevant foreign state. International arbitration is also accepted as a means for settling investment disputes between private parties.
The Jamaican judicial system has a long tradition of being fair, but court cases can take years or even decades to resolve. A new Chief Justice appointed in 2018 has set aggressive benchmarks to streamline the delivery of judgments, bring greater levels of efficiency to court administration, and target throughput rates in line with international best practice. Efforts are currently underway to provide hearing date certainty and disposition of cases within 24 months, barring exceptional circumstances. The deployment of new courtrooms and the appointment of additional Appeal Court Judges are indicators of Jamaica’s commitment to justice reform.
Challenges with dispute resolution usually reflect broader problems within the court system, including long delays and resource constraints. Subsequent enforcement of court decisions or arbitration awards is usually adequate, and the local court will recognize the enforcement of an international arbitration award.
A specialized Commercial Court was established in 2001 to expedite the resolution of commercial cases. The rules do not make it mandatory for commercial cases to be filed in the Commercial Court and the Court is largely underutilized by litigants.
Jamaica ranked 119 in the 2019 Doing Business Report on the metric of enforcement of contracts, scoring 64.8 in the length of time taken for enforcement, 43.6 for costs associated with litigation and 52.8 on the quality of judicial processes.
Laws and Regulations on Foreign Direct Investment
There are no specific laws or regulations specifically related to foreign investment. Since foreign companies are treated similar to Jamaican companies when investing, the relevant sections of the applicable laws are applied equally.
Competition and Anti-Trust Laws
The Fair Trading Commission (FTC), an agency of the Ministry of Industry, Commerce, Agriculture and Fisheries (MICAF), administers the Fair Competition Act (FCA). The major objective of the FCA is to foster competitive behavior and provide consumer protection. The Act proscribes the following anti-competitive practices: resale price maintenance; tied selling; price fixing; collusion and cartels; and bid rigging. The Act does not specifically prohibit mergers or acquisitions that could lead to the creation of a monopoly. The FTC is empowered to investigate breaches of the Act and businesses or individuals in breach can be taken to court if they fail to implement corrective measures outlined by the FTC.
Expropriation and Compensation
Expropriation is generally not an issue in Jamaica, although land may be expropriated for national development under the Land Acquisition Act, which provides for compensation on the basis of market value. The U.S. government is not aware of any current expropriation-related litigation between the Jamaican government and any private individual or company. However, the U.S. government assisted investors who had property expropriated during the 1970’s socialist regime, with a payment in one such case received in 2010.
ICSID Convention and New York Convention
Jamaica became a signatory to the International Center for Settlement of Disputes (ICSID) in 1965. The country is a signatory to the New York Convention (the Convention on the Recognition and Enforcement of Foreign Arbitral Awards), which governs the recognition and enforcement of foreign arbitration awards. The Jamaican Arbitration (Recognition and Enforcement of Foreign Awards) Act enables foreign arbitral awards under the New York Convention to be enforced in Jamaica.
Investor-State Dispute Settlement
International arbitration is also accepted as a means for settling investment disputes between private parties. Jamaica enforces the judgments of foreign courts through: (1) The Judgment and Awards (Reciprocal Enforcement) Act; (2) The Judgment (Foreign) (Reciprocal Enforcement) Act; and, (3) The Maintenance Orders (Facilities for Enforcement) Act. Under these acts, judgments of foreign courts are accepted where there is a reciprocal enforcement of judgment treaty with the relevant foreign state. Jamaica does not have a history of extrajudicial action against foreign investors.
International Commercial Arbitration and Foreign Courts
Jamaica accepts international arbitration of investment disputes between foreign investors, the Jamaican government, and private parties. Local courts recognize and enforce foreign arbitral awards. The Caribbean Court of Justice (CCJ) serves as the region’s international tribunal for disputes within the Caribbean Community (CARICOM) Single Market and Economy. The Dispute Resolution Foundation and the Caribbean Branch of the Chartered Institute of Arbitrators both facilitate arbitration and rules of the Bilateral Investment Treaty (BIT). Other foreign investors are given national treatment and civil procedures apply. Disputes between enterprises are handled in the local courts but foreign investors can refer cases to ICSID. There were cases of trademark infringements in which U.S. firms took action and were granted restitution in the local courts. While restitution is slow, it tends to be fair and transparent. The U.S. government is not aware of any cases in which State-Owned Enterprises (SOEs) have been involved in investment disputes.
Jamaica enacted new insolvency legislation in 2014 that replaced the Bankruptcy Act of 1880 and seeks to make the insolvency process more efficient. The Act prescribes the circumstances under which bankruptcy is committed; the procedure for filing a bankruptcy petition; and the procedures to be followed in the administration of the estates of bankrupts. The reform addresses bankruptcy; insolvency, receiverships; provisional supervision; and winding up proceedings. The law addresses corporate and individual insolvency and facilitates the rehabilitation of insolvent debtors, while removing the stigma formerly associated with either form of insolvency. Both insolvents and “looming insolvents” (persons who will become insolvent within twelve months of the filing of the proposal if corrective or preventative action is not taken) are addressed in the reforms.
The Act contains a provision for debtors to make a proposal to their creditors for the restructuring of debts, subject to acceptance by the creditor. Creditors can also invoke bankruptcy proceedings against the debtor if the amount owed is not less than the prescribed threshold or if the debtor has committed an act of bankruptcy. The filing of a proposal or notice of intention to file a proposal creates a temporary stay of proceedings. During this period, the creditor is precluded from enforcing claims against the debtor. The stay does not apply to secured creditors who take possession of secured assets before the proposal is filed; gives notice of intention to enforce against a security at least 10 days before the notice of intention or actual proposal is filed; or, rejects the proposal. The 2014 legislation makes it a criminal offence if a bankrupt entity defaults on certain obligations set out in the legislation.Jamaica ranked 34 on Resolving Insolvency in the 2020 World Bank’s Doing Business Report. Bankruptcy proceedings take about a year to resolve, costing 18 percent of the estate value with an average recovery rate of 65 percent.The text of the Bankruptcy and Insolvency Act can be found at: http://www.japarliament.gov.jm/attachments/341_The%20Insolvency%20Act%202014%20No.14%20rotated.pdf