Local Content Policy must protect Guyanese from being used as "window dressing" by foreign players

Local Content Policy must protect Guyanese from being used as “window dressing” by foreign players

Mar 28, 2021 News

– they must be meaningful partners in oil sector – GCCI Senior VP

By Kiana Wilburg

Senior Vice President of GCCI, Timothy Tucker.

Kaieteur News – While the draft Local Content Policy contains provisions which encourage joint venture partnerships between citizens and foreign companies, it must ensure that there is adequate protection to prevent Guyanese from being “rented” or used as “window dressing.” This perspective was recently proffered by Senior Vice President of the Georgetown Chamber of Commerce and Industry (GCCI), Timothy Tucker.
During his first appearance on Kaieteur Radio’s Programme, Guyana’s Oil and You, Tucker was keen to note that the current draft is a vast improvement over the one that was promulgated by the former coalition regime. Be that as it may, Tucker said, the final policy must have a clear-cut, foolproof definition of what qualifies as a local business. In his eyes, a foreign company should not be able to cheat the system by using the name of a Guyanese on registration documents, stating that the local has 51 percent ownership, and say they are now a local business, when in reality, the local partner is just there as “window dressing.”
The Senior Vice President said,”…We need to have a real test of locality. We do not want to have companies coming and rent a citizen. You would probably end up with people sitting back and because their name is there…Timothy Tucker Oil and I own 51%, it is really and truly that my agreement is that I have a retainer fee and 95% of the profits are going to a partner who only owns 49%…”
He continued, “So we have got to make sure that the profits, the way that it is defined, that there is a term test of locality, that your local content and the Guyanese there, that the money is actually staying here because that is the purpose of local content. It is to get that money to stay here and it could develop the country.”
Tucker added, “There are a few laws that need to be changed to help that situation and we have identified those to the government and I am sure the Chamber will release its official comments in the press release at some point in time.”
Kaieteur News would have reported last week that several countries have sought to ensure that there are stiff penalties to guard against the kind of local content deceit Tucker noted by way of policies, laws and regulations.
In Ghana, for example, the legislative framework ensures that any foreigner who desires to set up shop and bid for contracts can only do so if they partner with locals. But for those who even contemplate effecting schemes to cheat the system, Ghana was keen to have clear-cut fines and jail time stipulated for such actions.
The Local Content Regulations of that African nation state, for example, “A citizen who acts as a front or connives with a foreign citizen or company to deceive the Commission as representing an indigenous Ghanaian company to achieve the local content requirement under these Regulations, commits an offence and is liable on summary conviction to a fine of not less than one hundred thousand penalty units and not more than two hundred and fifty thousand penalty units or to a term of imprisonment of not less than one year and not more than two years or to both.”
It also notes, “A person who connives with a citizen or an indigenous Ghanaian company to deceive the Commission as representing an indigenous Ghanaian company to achieve the local content requirement under these Regulations, commits an offence and is liable on summary conviction to a fine of not less than one hundred thousand penalty units and not more than two hundred and fifty thousand penalty units or to a term of imprisonment of not less than one year and not more than two years or to both.”
It is instructive to note as well, that anyone who knowingly submits false documents and makes false statements to Ghana’s Commission along with fronting for a foreign individual or a company to give the impression that local content is being achieved, would also have to face the proverbial music.
Ghana’s regulations in this regard specifically states that, “A person who submits a plan, returns, report or other document and knowingly makes a false statement, commits an offence and is liable on summary conviction to a fine of not less than one hundred thousand penalty units and not more than two hundred and fifty thousand penalty units or to a term of imprisonment of not less than two years and not more than five years or to both.”

Discover more from Kaieteur News

Subscribe to get the latest posts sent to your email.

Latest News