By FAY SIMMONS

jsimmons@tribunemedia.net

THE PRIME Minister yesterday described The Bahamas’ efforts to establish itself as an international arbitration centre as “long overdue”, and added: “The deck is stacked in our favour.”

Philip Davis KC, leading off House of Assembly debate on the International Commercial Arbitration Bill 2023, said the new legislation - as well as separate reforms to the existing Arbitration Act 2009 - were critical to enabling The Bahamas to “tap into our full potential”.

Besides providing an additional draw for international investors by giving them access to a more efficient, less time-consuming and costly dispute resolution system outside the courts, he added that the new Bill will further bolster existing key industries - especially financial services and the maritime sector.

Pointing out that “most” commercial disputes in the maritime industry were resolved through arbitration or some form of alternative dispute resolution (ADR), Mr Davis said the International Commercial Arbitration Bill represents “a major advancement” for the Bahamian financial services industry by including trust disputes within its remit.

Trusts are a key product offered by the Bahamas’ financial sector, and the Prime Minister said the Bill - which passed its second reading in the House of Assembly - “clarifies provisions in the law to provide efficient and cost effective resolution of trust disputes”. The Bill replaces existing provisions in the Trustee Act that provide for alternative resolution of trust disputes, instead bringing such processes within its remit.

“Given the importance of financial services as the second pillar of our economy, which employes many talented Bahamians, the inclusion of trust disputes is a major advancement and opens the door to many possibilities,” Mr Davis said. “The global financial services market is very competitive, and to stay ahead of the competition we must remain on the cutting edge and ensure settlors, beneficiaries and trustees rely on arbitration to resolve disputes.”

Establishing The Bahamas as an international arbitration hub will also create work for local attorneys, accountants and other professionals who can build expertise in alternative dispute resolution (ADR). The Prime Minister acknowledged that the move has been a long time coming, while Pia Glover- Rolle, minister of state for the public service, said The Bahamas’ ambitions in this space dated back some 15 years at least to the mid-200s.

Questions will likely be asked as to why it has taken The Bahamas so long, but Mr Davis said it was vital that investors and companies “feel a sense of security when they do business within our borders” and “don’t have to go through costly legal disputes” to resolve commercial differences.

“Over the past year this administration has promote The Bahamas as a safe harbour for financial services and investment. As a safe harbour we have weathered storm after storm, both literally and figuratively. Through it all we have emerged stronger. Investors have taken note. We have investments in the pipeline worth billions of dollars,” the Prime Minister added, naming even Mayaguana and Inagua as potential recipients.

“The wind is in our sails and we must keep the momentum going. Becoming an international arbitration centre is critical to tapping into our full potential.” Mr Davis said the Bill lays out the rules framework governing arbitration proceedings in The Bahamas, and said the country’s large legal profession, financial services history and geographic location were all strengths in its ambitions to become an alternative dispute resolution (ADR) hub.

“The deck is stacked in our favour,” Mr Davis added. “There is no reason for us not to be successful in this endeavour especially when Bahamian excellence is on full display. It is a shame we have not fully tapped into our potential as an arbitration centre, but this administration is committed to changing that. The steps we are taking today are long overdue.....

“We must ensure that investors and corporations are comfortable with our dispute resolution framework. As an international arbitration hub, we will attract more foreign investment to our shores, while reassuring domestic investors there are protections in place for them. We are improving the general business environment by providing all businesses with an affordable, efficient means of addressing conflicts that may arise.

“Local businesses who engage in international trade will be able to enter into agreements based on our records, and be certain that fair process will be in place to resolve any differences that arise. Overall, our legal system with be strengthened and the perception of our system will be enhanced as the adoption of international best practices boosts our credibility and establishes our reputation as an emerging hub for arbitration.”