Local Content Secretariat to review law that describes who is considered a Guyanese National

Jan 24, 2023 News

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Kaieteur News – Director of Guyana’s Local Content Secretariat (LCS), Dr. Martin Pertab has disclosed that the Agency is looking to refine the Local Content Act of 2021, particularly, that they are seeking to amend the term which describe ‘who is considered a Guyanese National.’

Dr. Pertab’s comment came after the Government lost a court case to Ramps Logistics late last year.

After the Government denied Ramps a Local Content Certificate for not reaching the requirement of being a 51 percent Guyanese-owned Company, Ramps had filed an application at the Demerara High Court challenging the decision. Stemming from the case, the Government was warned about arbitrariness due to the lack of rules and regulations in the Local Content Act.

The Director’s comment was featured in the Q4 edition of the 2022 Energy Magazine. According to the magazine, Dr. Pertab noted that the Act is a living organ and will evolve in tandem with the oil industry. He disclosed that the Secretariat’s team started a review of the Act in 2022, based on experiences in the field during the implementation phase, and will continue this analysis into 2023. “As part of reviews, the Secretariat will relook at the conditions of who is considered a Guyanese national,” the Director disclosed.

The Local Content Act described a Guyanese National as a citizen of Guyana, a Guyanese company as, ‘any company incorporated under the Companies Act – which is beneficially owned by Guyanese nationals who ultimately exercise, individually or jointly, voting rights representing at least 51 percent of the total issued shared of the company and that has Guyanese nationals holding at least 75 percent of the executive and senior management positions and at least 90 percent of non-managerial and other positions…”

It was stated in the magazine that from the Secretariat’s perspective of the first phase of implementation, there are areas for continued development. As such, the Secretariat is targeting adjustments in the Act, “Particularly its First Schedule to make room for improvements to the law,” Pertab said, adding that, “The Natural Resources Ministry plans to establish, too, regulations to guide the newly-improved Act.” “This review will serve as an added layer of protection to guard against those who wish to circumvent the law,” Pertab affirmed.

Kaieteur News had reported that Chief Justice (AG), Roxane George-Wiltshire warned against arbitrariness due to the lack of rules and regulations in Guyana’s Local Content Act of 2021. She was at the time delivering her ruling in the Judicial Review matter against the Government of Guyana’s refusal to provide Ramps Logistics with a Local Content Certificate.

Justice George-Wiltshire ruled that the Director of the LCS had until noon on Monday, November 14, 2022, to issue a Local Content Certificate to Ramps Logistics.

Ramps Logistics, which is originally from Trinidad and Tobago had registered under Guyana’s Companies Act, but was denied a Local Content Certificate as required under the Local Content Act of 2021, for purportedly not being a ‘Guyanese company.’

In December 2021, Guyana passed its Local Content Legislation, which caters to locals getting first preference in the country’s oil and gas sector. The Local Content Law is intended to regulate the way companies operate in Guyana’s oil and gas sector, employ persons, buy services, and the way that they procure goods.

Under the Act, the Local Content Secretariat (the Secretariat) has been established and functions as the focal point for the monitoring, evaluation, coordination, and reporting of Local Content in the petroleum operations of Guyana. Therefore, the Secretariat’s key role is to monitor and evaluate companies’ performance with respect to the Guyanese utilization targets outlined in the Act.

However, since its passage, there have been several local content issues that were raised by the local businesses and the private sector. The Chief Justice in her ruling said, “This Act has no rules or regulations and this allows for arbitrariness.” She explained that from the time the Secretariat realised that they needed certain regulations to better execute the mandate of the Local Content Act, they should have alerted the Attorney General Chambers to get those regulations implemented.

“The Local Content Act clearly needs regulations so as to prevent arbitrary decision-making,” the Chief Justice said.

Moreover, following the CJ’s ruling, the Attorney General and Minister of Legal Affairs, Anil Nandlall, SC, in a missive had said that the regulations and guidelines to support and strengthen the Legislation are being drafted.

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• Dr. Martin Pertab, Guyanese National, Local Content Secretariat, nergy Magazine, Ramps Logistics

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