Local Content Policy…No sanctions for noncompliance by companies at this time - Trotman

Local Content Policy…No sanctions for noncompliance by companies at this time – Trotman

Aug 27, 2017 News

By Kiana Wilburg
Countries across the world have experienced various challenges as it relates to the implementation

Natural Resources Minister, Raphael Trotman

of their respective Local Content Policies. One of the main hurdles, is getting oil and gas companies to comply. Nations have found that the “encouraging” nature of the policy is what is often responsible for noncompliance. This has led many territories to strengthen their Local Content Policy by including sanctions for nonconformity.
The Government of Guyana has already received several submissions on the draft Local Content Policy. But according to Minister of Natural Resources, Raphael Trotman, the inclusion of sanctions for noncompliance into the policy is not on the table at this time.
In an interview with Kaieteur News, Trotman reminded that the Government has retained the services of Mr. Anthony Paul, a United Nations Expert who also authored the Local Content Policy for Ghana.
The Natural Resources Minister said, “And so it was his (Anthony Paul’s) idea that, you start with a working draft and as the feedback comes in, it can be strengthened. It was also his recommendation and that of other experts that you don’t start your legislation with sanctions because your industry is growing. So as it grows, you implement or enact laws for that but in the beginning, sanctions could act as kind of a disincentive.”
Trotman continued, “So we are looking at best practices elsewhere. The working draft is of course being refined. In fact, Mr. Paul is due to meet with the private sector to take into account different comments for its improvements. So what we have is a working draft, we have to look not only at the lessons learn in Equatorial Guinea but also in Brazil.”
The Minister added, “In the case of Brazil, it is referred to being a country with too many sanctions which in fact hurt its industry. Trinidad for example has no laws, but it has a policy…So we have been looking at a number of countries to see what would be the best fit for Guyana in terms of our own capacity and development.”
As it relates to strengthening the draft policy, Trotman said that there have been a number of recommendations to close loopholes as it relates to favouritism, political interference and procurement fraud.

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