06192018 business

business@tribunemedia.net

TUESDAY, JUNE 19, 2018

$4.80 Bahamasair loses Supreme Court ‘jurisdiction’ challenge * CONTESTED ABILITY TO HEAR UNFAIR DISMISSALS * APPEAL COURT: ‘POLICY ISSUE’ FOR PARLIAMENT

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net BAHAMASAIR’S challenge to the Supreme Court’s “jurisdiction” to hear employee unfair dismissal cases has been rejected by the Court of Appeal.

The national flag carrier’s bid to overturn an award made to Omar Ferguson, a former customer service agent, was branded a “fallacy” by the appellate court because the Bahamas’ Employment Act was different from the UK and Cayman laws upon which it based its argument.

Appeal Justice Stella Crane-Scott, in delivering a unanimous June 13 verdict, said that while there were arguments against “two parallel routes” for resolving employment disputes - in this case the Supreme Court and Industrial Tribunal - this was an issue to be resolved

by Parliament and not the courts.

With nothing in Bahamian statute law to prevent it, she found that unfair dismissal cases could be brought either through the Employment Act or Industrial Relations Act’s trade disputes procedure.

The opposite ruling would have had major implications for Bahamian labour law and employee/employer disputes, after Bahamasair and its attorney, Ferron Bethell of Harry B Sands & Lobosky, cited the Supreme Court’s alleged lack of jurisdiction to hear unfair dismissal cases as a major part of their appeal.

But the Court of Appeal found that the law for resolving employment disputes in The Bahamas was “completely different”, with no “similar or equivalent” provisions to the UK and/or Cayman Islands.

Mr Bethell also argued that the numerous references to the Industrial Tribunal in the Employment Act section dealing with unfair dismissal was “a strong indication” that only

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$4.91

‘We can’t trust future govts over fiscal fix’

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

T

HE government’s fast-paced fiscal fix is being driven by its lack of trust in future administrations to correct multi-million dollar “imbalances”, the deputy prime minister revealed yesterday.

KP Turnquest admitted to Tribune Business that the government’s “aggressive” strategy was “not without risk”, but said it had little choice due to uncertainty over whether its successors would share the same enthusiasm for fiscal consolidation.

Pointing out that The Bahamas’ interest bill is now $100m greater than the next-largest budget line item, Mr Turnquest said the

* DPM: STRATEGY ‘NOT WITHOUT RISK’ * ‘AGGRESSIVE’ ACTION CUTS INTEREST $80M * GOVT TAX TAKE DOUBLES BY $1.4BN IN SEVEN YEARS

government cannot rely on increased economic growth alone to turn the fiscal tide.

He disclosed that its debt servicing bill would have risen by a further $80m in the upcoming budget year had it not implemented the 60 percent VAT rate hike, with such rising costs threatening to “eat up” any GDP growth.

While the 12 percent VAT rate is projected to suck an extra $400m from the

Bahamas attracts $767m investment in past year

By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

PM HUBERT MINNIS

DPM K PETER TURNQUEST

Bahamian economy during the 2018-2019 fiscal year, Mr Turnquest suggested the blow would be cushioned by the fact that the $360m in arrears - some $172m of which will be paid this year will be injected straight back via payments to vendors and suppliers.

Budget data shows that the government’s tax take will have almost doubled within seven years if its short-term

KHAALIS ROLLE

by February next year, it allows them to be honoured at the existing VAT rate.”

Full details of this “transition” arrangement will be provided in the “guidance notes” that the Ministry of

THE Bahamas has attracted more than $700m in foreign capital investment over the past 12 months, the prime minister said yesterday.

Dr Hubert Minnis, during his contribution to the 2018/2019 budget debate, said: “Total foreign capital investment in The Bahamas beginning May 2017 until the present date is estimated at $767.44m.

This capital investment is projected to generate 6,004 construction jobs for Bahamian contractors, and 8,040 operational positions within the next five years.”

The prime minister said New Providence had attracted the greatest share of such inflows with investments in resorts, condominium developments, farming and cement manufacturing.

“The New Providence market is buoyed by the $20m purchase of the Hurricane Hole land and marina property on Paradise Island

by Sterling Hurricane Hole.

The property will be developed into the Hurricane Hole Residential Community Resort and Marina, and will expend an estimated $194m through its completion in 2025,” said Dr Minnis.

He also pointed to the relocation of Shell Western Supply and Trading’s operations from Barbados to The Bahamas. “The company is involved in proprietary international trading in commodities. An estimated $3m will be expended to establish the new office on New Providence,” the prime minister disclosed.

“The Eleuthera resort and residential property

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fiscal targets are hit, with revenues rising from $1.47bn in 2013-2014 to $2.885bn in 2020-2021 - a near $1.4bn or 96.2 percent increase.

The figures highlight the huge, and rapid, increase in monies paid to the public treasury to finance the explosive growth in the government’s size, with total recurrent spending projected

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Eight-month VAT transition is ‘best thing for builders’

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Bahamian Contractors Association’s (BCA) president yesterday hailed the eight-month VAT “transition” for existing projects as “the best thing the government can do for construction”.

Leonard Sands told Tribune Business that the Minnis administration’s decision to “honour” the existing 7.5 percent VAT rate for developments and construction contracts already underway gave the industry “a real chance to rebound” from the budget’s tax hikes.

He was reacting after Marlon Johnson, the Ministry of Finance’s acting financial secretary, confirmed to this newspaper that the government was providing “leeway” for

* Existing construction gets February 2019 ‘leeway’ * BCA chief hails move as ‘real rebound chance’ * Developers hoping for ‘claw back’ provision

LEONARD SANDS projects scheduled to be completed by February 2019 following representations from the industry.

“We’ve had representations from small contractors and developers with contracts already set to give them some guidance and

$4.91

MARLON JOHNSON leeway on costs already fixed through February next year,” Mr Johnson said.

“What it would mean is that where work is already in progress and money transacted, and real estate projects and construction underway to be completed

Breadbasket ‘zero rate’ delayed until August 1

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THE VAT “zero rating” of breadbasket food items has been delayed until August 1 to allow merchants time to adjust their systems and pricing, a top official revealed yesterday.

Marlon Johnson, the Ministry of Finance’s acting financial secretary, told Tribune Business that the month’s delay would enable retailers’ point of sale (PoS) and inventory mechanisms to account for the multiple tax exemptions.

“The reason for that is to give the retailers time to adjust their point of sale systems, their inventory systems and receipts to account for the exemptions,” Mr Johnson said, indicating that the government would be lenient when it came to merchants adjusting all their

* Merchants gain exemption adjustment time * Finance ‘working furiously’ on guidance notes * Leniency likely on price, labelling compliance pricing, labelling and signage

by July 1.

He added that the Ministry of Finance was “working furiously” to complete the “guidance notes” that will advise the private sector on the transition to a 12 percent VAT, with their release set to potentially occur as early as tomorrow.

Mr Johnson reaffirmed, though, that “the unassailable message” is that the 60 percent VAT rate hike will take effect from July 1. And, notwithstanding the wait for the guidance notes, the Ministry of Finance is expecting all businesses to be “well advanced” in their preparations for 12 percent VAT so they can be compliant by the deadline.

“That’ll be happening this week,” Mr Johnson told Tribune Business of the guidance notes’ release. “It may be as early as Wednesday, but certainly this week. The team is finalising them as we speak.

“We’ve been working furiously on them. We want to make sure they’re correct.

We’ve also been in talks with key industries to inform them of the government’s position on key matters.

VAT will be 12 percent on July 1, and that remains the government’s policy; there’s been no waiver from that.

“It’s just important to get the questions answered, the information out there, because questions come to us. We want to let consumers

know what to expect come July 1.” That date is now just 12 days away.

The Ministry of Finance official added that the government would be lenient when it came to large retailers meeting the July 1 deadline to alter their pricing and labelling for the 12 percent VAT, given that thousands of products are affected.

“The government will look at things around signage and price tags,” Mr Johnson told Tribune Business. “As far as price tags and labelling, we understand those big retailers will take time to get that done. There may be instances where not all price

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PAGE 2, Tuesday, June 19, 2018

THE TRIBUNE

Breadbasket ‘zero rate’ New BPL reconnection delayed until August 1 plan for 3,000 clients FROM PAGE ONE

tags are updated but that’s part of the transition.”

He added that the government had already moved to ease the VAT transition for specific industries where it was warranted, pointing to the hotel and tourism industry in particular.

“The government is providing an accommodation where they have bookings and reservations made in which we will honour the existing VAT rate,” Mr Johnson confirmed. “A lot of the bookings done by hotels for large groups and conventions are fixed bookings.”

But, while the government may have smoothed the process for hotels, he said no further changes were likely for sectors such as the automobile industry. The sector

To advertise in The Tribune, contact 502-2394

had been seeking an increase in the 1.5cc engine size limit for the new 25 percent duty rate, and an “offset” in the form of tax credits for the excise tax they will have to “eat” on existing stock.

“There’s been no indication from the policy level of anything further for the auto dealers,” Mr Johnson said. “The Ministry felt confident that change to allow a drop in duty rates for small vehicles, hybrids and electric vehicles creates substantial opportunity for them regardless of any other adjustments being made.”

The financial secretary said feedback from the private sector suggested many businesses were already well on their way to compliance

by July 1 and adjusting their systems for a 12 percent VAT. “We hope and anticipate businesses are well advanced in their plans to be ready for July 1,” Mr Johnson told Tribune Business. “The vast majority of them are on electronic, very sophisticated point of sale systems.”

NOTICE

ERIOS MERLION & CO. LTD. N O T I C E IS HEREBY GIVEN as follows: (a) ERIOS MERLION & CO. LTD. is in voluntary dissolution under the provisions of Section 138 (4) of the International Business Companies Act 2000. (b) The dissolution of the said company commenced on the 14th June, 2018 when the Articles of Dissolution were submitted to and registered by the Registrar General. (c) The Liquidator of the said company is Bukit Merah Limited, The Bahamas Financial Centre, Shirley & Charlotte Streets, P.O. Box N-3023, Nassau, Bahamas Dated this 19th day of June, A. D. 2018 _________________________________ Bukit Merah Limited Liquidator

By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net BAHAMAS Power & Light (BPL) has agreed to a reconnection plan for the 3,000 customers who remain disconnected, the prime minister said yesterday.

Dr Hubert Minnis, during his contribution to the 2018/2019 budget debate, said that to be reconnected a customer must pay 25 percent of their outstanding balance.

“I note that in the past BPL had done something like this, where customers were required to pay 50 percent. Customers must maintain monthly payments of current bills plus ten percent of arrears, which should allow full repayment in 11 months,” he said.

“I note that BPL usually seeks to have arrears repaid within six months.”

Dr Minnis said this was a policy enacted under the former Ingraham administration. “Customers must also agree to sign a payment

plan. This will clearly show that we are looking after the people,” he added.

The government has decided to raise the VAT exemption ceiling on electricity bills from the previously proposed $100 to $200. The change will come into effect on August 1. The decision to place the ceiling at $100 was met with calls to increase the limit as some consumers argued not many households fell within the range to receive the exemption.

Bahamas attracts $767m investment in past year FROM PAGE ONE markets have been the most active among the Family Islands in recent months, making up a substantial amount of the total investments. The $4m Harbour Island Resort and Marina, with an estimated capital investment of $55m, will add to the ultra-luxury resort and marina product offerings on Harbour Island.

“Nearby Man Island, will experience a newlyconstructed 15-room hotel. Unicorn Cay Development is in the initial stages of developing a second-home

residential community in Central Eleuthera. A new cement plant will be built on Eleuthera to augment the supply of concrete products for the fast-growing construction industry on the island.”

Dr Minnis said government-approved investments in Grand Bahama are heavily concentrated in tourism and the digital economy. “Grand Palm Beach expended $42m for the acquisition of the former Ginn sur Mer stalled resort, marina and airport development at West End Grand Bahama,” he said.

“Economic activity in west Grand Bahama is being supported by the Blue Marlin Cove resort and marina expansion project valued at approximately $1.2m.

East Grand Bahama was approved for a $37m resort hotel and commercial development, which will include a world-class motor sport and karting tracks. Other Grand Bahama investments focused on pea rock production and the purchase and redevelopment of distressed rental properties into boutique resorts in Freeport city.”

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DOCTORS HOSPITAL IN WESTERN RESTRUCTURE DOCTORS Hospital Health System plans to restructure its outpatient services facility on Blake Road with effect from July 6, renaming it Doctors Hospital West.

As part of the restructuring, elective surgeries will resume in the Blake Road operating theatre starting next month. Urologists will offer brachytherapy for the treatment of prostate cancer, while comprehensive rehabilitation services

The Winterbotham Trust Company Limited Winterbotham Place – P.O. Box N-3026 – Marlborough & Queen Streets Nassau – The Bahamas Tel: (1-242) 356-5454 – Fax: (1-242) 356-9432 E-mail: nassau@winterbotham.com – Website: www.winterbotham.com

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- including aquatic therapy - will continue to be offered at Doctors Hospital West.

The BISX-listed healthcare provider added that to better provide inpatients with the advanced wound care and healing benefits of Hyperbaric Oxygen Therapy (HBOT), the HBOT chamber is moving to its main Doctors Hospital facility on Collins Avenue.

Laboratory and imaging services will continue to be offered at Doctors Hospital West, as well as the Fecal Microbiota Transplant and Stem Cell programmes.

Doctors Hospital plans to add other services, including an Interventional Pain Clinic and Restorative Medicine, at Doctors Hospital West.

Following a thorough audit of the business model and performance, all patients requiring urgent or emergency care will be redirected to the 24-hour

Emergency Room at Doctors Hospital on Collins Avenue.

To ensure persons living in western New Providence have fast access to the private hospital’s emergency services, Doctors Hospital will provide dispatching an ambulance from Doctors Hospital West.

Charles Sealy, Doctors Hospital’s chief executive, said: “We anticipate that some people will still arrive at our Blake Road facility doors seeking urgent care, so processes will be in place to ensure that urgent cases can be assisted until they can be transported to Collins Avenue.”

Blake Road’s private tenants: Dr Kathryn DeSouza, physiatrist; Dr Kenneth Kemp, podiatrist; Dr Renee Peet Iferenta, dentist; the hearLIFE Clinic, StemCell Bahamas and Sandy’s Café will continue to occupy space in Doctors Hospital West.

NOTICE

The Winterbotham Trust Company Limited is looking to fill the position of a Client PANDA GROUP LIMITED Accounting Unit Manager Winterbotham Trust Company Limited is looking to fill the position of a Client Accounting Unit nager N O T I C E IS HEREBY GIVEN as follows: Main Function: Specializing in both trust and corporate accounting and preparation of financial statements. Review transactions recorded in the books and FS to be sent PANDA GROUP LIMITED is in voluntary n Function: Specializing in both trust and corporate accounting and preparation of financial statements. (a) to clients. Verify that supporting documents of the transactions are duly filed. dissolution under the provisions of Section 138 (4) of the

ew transactions recorded in the books and FS to be sent to clients. Verify that supporting documents of International Business Companies Act 2000. ransactions are duly filed.

In this challenging position you will be responsible for but not limited to the

is challenging position following tasks:you will be responsible for but not limited to the following tasks:

Fully responsible for the accounting for a portfolio of trusts and companies in multiple jurisdictions; • Fully for the accounting for a portfolio of trusts and companies in multiple jurisdictions; • responsible Responsible for providing excellent and flexible service support to local • Responsible for providing excellent and flexible service support to local and international clients; and international clients; • Responsible for supervision and review of work of junior accountants in Nassau office, leading the team • providing Responsible for supervision and review of work of junior accountants in and support for prioritization of tasks.

Nassau the team and providing support for prioritization of • Able to review work office, of Hongleading Kong Accounting Manager if required • Responsibletasks. for/able to perform full suite of accounting services such as preparation of payments, journal entries, management accounts; • Able to review work of Hong Kong Accounting Manager if required • Full responsibility for drafting annual financial statements and related disclosures in accordance to • Responsible for/able to perform full suite of accounting services such as appropriate reporting standards and co-ordination with auditors; preparation of payments, journal entries, management accounts; • Filing of annual financial statements and liaising with the relevant authorities when required.

• Full responsibility for drafting annual financial statements and related disclosures in accordance to appropriate reporting standards and coordination with auditors; • Filing of annual financial statements and liaising with the relevant successful applicant must have the following qualifications:

authorities when required.

• • • • •

•

Experienced in corporate and trust accounting; ideally also experienced in private equity and real estate; Qualified CPA or equivalent (eg ACA, ACCA); The successful applicant must have the following qualifications: Fluent in spoken and written English; Team ability to achieve several objectives in a dynamic environment • work-focused, Experienced in corporate and trust accounting; ideally also experienced in Minimum ofprivate equity and real estate; 5 years’ relevant work experience.

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Qualified CPA or equivalent (eg ACA, ACCA); Fluent in spoken and written English; Team work-focused, ability to achieve several objectives in a dynamic Applications/resume should be sent by e-mail to pgoudie@winterbotham.com & environment vmachado@winterbotham.com Minimum of 5 years’ relevant work experience.

Under reference “Client Accounting Unit Manager,” ABSOLUTELY NO TELEPHONE INQUIRIES WILL BE ACCEPTED

Persons not meeting the above requirements need not apply Deadline for applications Wednesday, June 27, 2018 Applications/resume should be sent by e-mail to

pgoudie@winterbotham.com & vmachado@winterbotham.com Under reference “Client Accounting Unit Manager,” ABSOLUTELY NO TELEPHONE INQUIRIES WILL BE ACCEPTED Persons not meeting the above requirements need not apply Deadline for applications Wednesday, June 27, 2018

(b) The dissolution of the said company commenced on the 14th June, 2018 when the Articles of Dissolution were submitted to and registered by the Registrar General. (c) The Liquidator of the said company is Bukit Merah Limited, The Bahamas Financial Centre, Shirley & Charlotte Streets, P.O. Box N-3023, Nassau, Bahamas Dated this 19th day of June, A. D. 2018 _________________________________ Bukit Merah Limited Liquidator

NOTICE

VISIONTIME INVESTMENTS LIMITED N O T I C E IS HEREBY GIVEN as follows: (a) VISIONTIME INVESTMENTS LIMITED is in voluntary dissolution under the provisions of Section 138 (4) of the International Business Companies Act 2000. (b) The dissolution of the said company commenced on the 14th June, 2018 when the Articles of Dissolution were submitted to and registered by the Registrar General. (c) The Liquidator of the said company is Bukit Merah Limited, The Bahamas Financial Centre, Shirley & Charlotte Streets, P.O. Box N-3023, Nassau, Bahamas Dated this 19th day of June, A. D. 2018 _________________________________ Bukit Merah Limited Liquidator

EIGHT-MONTH VAT TRANSITION IS ‘BEST THING FOR BUILDERS’ FROM PAGE ONE Finance plans to release to the private sector this week, but Mr Johnson’s comments suggest the government has agreed to much of what Mr Sands and the BCA have called for.

The BCA president said he was unaware of the move when contacted

by Tribune Business yesterday, but added that it would help calm much of “the panic” that arose in the construction and real estate development sectors over the new 12 percent VAT rate and related implementation uncertainties.

“We’re happy with that.

It really gives the sector an opportunity to get into a phase of real growth,” Mr Sands said. “If VAT is maintained at 7.5 percent, it gives the construction sector a real chance to rebound. It would be the best thing the government could do for that sector.”

Mr Sands and the BCA had earlier this month called for a “waiver”, or six-month transition, to 12 percent VAT to prevent contractors/ developers locked into existing contracts from being “wiped out”.

The construction industry had feared it would have to “eat” or absorb the 60 percent VAT rate hike in contracts that had already been priced and agreed - a situation that threatened to erode or eliminate contractor profit margins, even forcing some to take a loss on existing jobs.

Material, supplier and construction services prices are set to increase on July 1 when the new 12 percent rate takes effect, and the BCA had argued that the 30-day implementation period was too short for contractors to adjust and renegotiate contracts with clients and the banks.

“We did express concern about the impact on existing projects already capitalised,” Mr Sands reiterated yesterday, “where the impact of a 12 percent VAT would have negative effects that it would be hard for the sector to recover from. “We felt very strongly that there ought to be time for existing projects to be completed, and not have an impact on industry contracts already set.”

The eight-month transition gives the construction industry slightly longer than the BCA had been seeking, and Mr Sands suggested the extra clarity would remove uncertainty that had caused developers to hold back on real estate projects.

“It had caused there to be a lot of panic in the marketplace,” he told Tribune Business of the VAT rate increase and transition concerns. “We saw the effects from that where people were wondering whether to to go ahead with projects. We feel this news will encourage people to pull the trigger and go ahead with projects.”

Real estate developers, though, yesterday revealed they had also been seeking a “claw back” provision allowing them to regain the VAT paid on “input” costs as a result of budget changes to the “transfer tax” structure.

Khaalis Rolle, Sterling Global Advisors’ managing director, warned that it was impossible to “absorb” a 60 percent VAT hike on projects such as his company’s $250m Hurricane Hole development as a result of their new “exempt” treatment.

He confirmed that the government had made Sterling and other developers “a proposal” to address this and other VAT-related transition issues, and the sector was now waiting to hear whether it had followed through on these ideas.

“They would have made some concessions to allow us to not be as severely impacted; some ‘grandfathering in’ clauses,” Mr Rolle said. “In addition there would have been some claw back provisions made.

In a business like this, you can’t absorb a 60 percent

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THE TRIBUNE

Tuesday, June 19, 2018, PAGE 3

GOV’T ‘CAN’T SUSTAIN’ $50M RENT PAYMENT

By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net THE GOVERNMENT “cannot sustain” the $50m it spends annually on renting commercial facilities, the prime minister said yesterday.

Dr Hubert Minnis, delivering his contribution to the 2018/2019 budget debate, told Parliament: “We are spending $50m

annually on rented commercial facilities.

We cannot sustain that and therefore we will also construct a multi-government complex to hold various ministries, Immigration, foreign affairs, passport and other agencies related to them, and we will look at the needs of other ministries so they can all be within one complex.

“Once we know which ministries are going in that

complex we can design a structure to accommodate such facilities. It’s only a matter of moving the $50m that we are paying outside to inside, and more improved quality facilities that Bahamian people can invest in and see their money grow.”

Dr Minnis said the complex will not be maintained by the government. “We have a bad track record.

It will be maintained by

proper agencies,” he said.

The prime minister added that public infrastructure was also a critical component of the government’s growth plan, “as modern and efficient infrastructure serves as a vital foundation for more buoyant growth of the private sector”.

“Such investments will include airports, bridges, docks, roads, administrative complexes and clinics

that will bring productive returns on investments, and provide employment for Bahamians throughout the country,” said Dr Minnis.

“The government will look to public-private partnerships in these endeavours to the extent that these are feasible and reasonable from an economic and financial point of view.

He added: “Instead of

the dubious PPPs that lacked contracts and transparency and any policy framework – the ones done by the previous administration that have only served to saddle the government with expensive short-term loans – this government will instead put in place a documented and established policy framework for PPPs that will be known and understood by the public.”

Bahamas attracts $767m investment in past year Bahamasair loses Supreme Court ‘jurisdiction’ challenge FROM PAGE TWO

FROM PAGE ONE that body was able to hear such claims.

However, the Court of Appeal ruled that the Supreme Court had “unlimited jurisdiction”, and said: “It has been suggested that there ought not to be two parallel routes for the adjudication of disputes in employment matters. That, in our judgment, is a policy matter for Parliament...

“As we see it, if Parliament intended to oust the jurisdiction of the Supreme Court to hear claims relating to unfair dismissal, it would require clear statutory language to do so and neither the Employment Act nor the Industrial Relations Act has expressly done so.

“In our judgment, where a dismissed employee elects to institute an action in the Supreme Court arising out of the termination of his employment, there is nothing in either Act which precludes him or her from alleging that he or she has been wrongfully and unfairly dismissed.

In short, both claims may be pursued in the Supreme Court, as they are in the Industrial Tribunal.”

The Court of Appeal, though, did allow Bahamasair’s appeal in part by reducing the damages awarded to Mr Ferguson by more than 50 percent - from the $19,316 granted by the Supreme Court to $9,100.

It found that Senior Justice Stephen Isaacs had wrongly calculated Mr Ferguson’s compensation by basing this on the formula provided by the Employment Act for wrongful dismissal cases, rather than unfair dismissal.

Recalling the facts of the case, the Court of Appeal said the former Bahamasair employee was hired in 1997 as a customer service agent at Lynden Pindling International Airport (LPIA) with

the stipulation that he would be terminated if his airport security clearance was ever withdrawn “for any reason”.

Mr Ferguson was placed on long-term disability leave in 2008 after a job-related injury. During this period, he was arrested in Atlanta and charged with “conspiracy to possess a controlled substance”. Despite being held in the US for four months, he was eventually released with the charges dropped, and returned to the Bahamas on April 2, 2011.

Two days after his return, Mr Ferguson went to Bahamasair’s human resources office to collect the disability benefits that had accumulated. He was told, though, that he may have difficulty in getting security clearance from the Airport Authority.

Unable to obtain this, he received a letter on April 7, 2011, from Bahamasair terminating his service. The letter, though, was dated March 31, 2011 - two days before he returned to The Bahamas.

With no prior notice of the termination, and “no opportunity” to challenge Bahamasair’s action via disciplinary proceedings or otherwise, Mr Ferguson and his attorney, Craig Butler, launched Supreme Court proceedings.

Backing the Supreme Court’s findings, the Court of Appeal noted that the termination was issued when Mr Ferguson was still overseas.

“The evidence clearly disclosed that on 4 April, 2011, when he attended the appellant’s office to collect his accumulated benefits, he had already been dismissed from his job.

“Even more egregious is the fact that the termination letter was only handed to him on 7 April, 2011, by which time his contract of employment had already been effectively terminated for seven days.”

The Court of Appeal said the unfairness of the dismissal was highlighted by the fact he was not actively working at LPIA, meaning that a security clearance from the Airport Authority was not essential. It added that Mr Ferguson was also entitled to “the presumption of innocence”, as all charges against him were dropped.

“As we see it, the appellant acted precipitously by unfairly terminating the respondent’s contract without a hearing, and before hearing from him or allowing him the opportunity to make representations to the Airport Authority to have the clearance restored,” the Court of Appeal found.

“Had the appellant given the respondent the opportunity to appeal the withdrawal of his security clearance with the Airport Authority, and had his efforts proved futile, the issue of frustration of the contract of employment would have been definitively settled. In such circumstances, the appellant could doubtless have argued with confidence that no explanation or mitigation by the respondent could alter their decision to formally terminate him.

“As things stand, the appellant acted in haste and in breach of [the Employment Act]. They did not wait or allow the respondent to seek restoration of the security clearance with the Airport Authority. In such circumstances, the appellant could not, in our view, properly take the view that no explanation or mitigation from the respondent could alter their decision to dismiss.

“Quite simply, the respondent had a statutory right not to be unfairly dismissed and, at the very minimum, the appellant was required to hear his explanation or mitigation and give him the option to approach the Airport Authority before he was dismissed.”

Dr Minnis told Parliament that as a result of the Commercial Enterprises Act 2017, and investment promotion tours in the US, the Bahamas attracted new businesses in financial services, biomedical health facilities, information technology and energy.

“Inflows in the tourism sector remained steady, with

the expansion of boutique marina resorts, new-build hotels and condominium complex, and the acquisition of stalled mega resort properties,” said Dr Minnis.

“There is also an uptick of inflows in agriculture and entertainment and services, with offerings such as motor sport and karting track facilities, theme parks, farm production, and a seafood processing plant.”

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PAGE 4, Tuesday, June 19, 2018

THE TRIBUNE

‘We can’t trust future govts over fiscal fix’ FROM PAGE ONE

to increase by almost $1bn over the same period - a 57.6 percent rise to $2.56bn.

Mr Turnquest, though, said this provided further support for the government’s corrective action as it showed how public spending had risen faster than the economy and private sector can sustain.

Many Bahamians have challenged the magnitude and pace of the government’s fiscal correction, arguing that the 12 percent VAT and three-year arrears pay-off are too much, too fast, and threaten to drive the economy back into recession.

But Mr Turnquest argued yesterday: “This is an assessment we have made. We believe it is the right thing to do, and we are doing it over a reasonable period of time. We have put this correction off for many, many years, and are getting to the point where our debt financing costs are almost $100m greater than the next most expensive budget item.

“There’s no way we can add $89m to that next year.

We have to address the problem. At the end of the day, somebody has to pay the bill. We can drag this out four-five years, and

get to another administration. They may or may not choose to do something.

“We have an opportunity to fix it, and believe with an increase in VAT we have an opportunity to do that and bring in those savings we have talked about.” The latter comment refers to the $100m in import and excise tax reductions Mr Turnquest has promised to “return” to taxpayers once the threeyear arrears pay-off is completed.

The government’s threeyear timeline is being driven by the need to hit the Fiscal Responsibility Bill’s 0.5 percent deficit target for 2020-2021, plus other factors such as the tax restructuring required for World Trade Organisation (WTO) membership.

But some observers, including Gowon Bowe, the Bahamas Institute of Chartered Accountants (BICA) president, have challenged the need for such haste while noting that it gets the worst of the fiscal consolidation out of the way before the next election cycle.

“Why the requirement for matters to be done in three years?” Mr Bowe told Tribune Business recently. “Is it just coincidence that this leads into the commencement of campaigning for the next election?

Eight-month VAT transition is ‘best thing for builders’ PUBLIC NOTICE

INTENT TO CHANGE NAME BY DEED POLL The Public is hereby advised that I, THELMA PENNERMAN of #57 West View Drive, Freeport, Grand Bahama, The Bahamas, mother of KERIAN PENNERMAN intend to change my child’s name to DYLAN ADRIAN PENNERMAN JR. If there are any objections to this change of name by Deed Poll, you may write such objections to the Chief Passport Officer, P.O. Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice.

“External observers have never mandated timelines.

They have criticised the absence of formal plans, with proper accountability through assessing the commitment to meeting targets set out in a formal plan. If the economy continues to grow, and deficits continue to reduce and move to surpluses, the timeline has greater flexibility.”

Mr Turnquest yesterday admitted to Tribune Business that the government was aware of the next election’s timing, but not for the reasons many may think.

“There’s no point in me hiding the fact we are cognisant of the next election deadline, but not from the point of view of being re-elected,” he told this newspaper. “We have an opportunity to fix it while we’re here, and if we go into another administration we don’t know what commitment they will have to fix the fiscal imbalances.

“While we have an opportunity we’re going to fix it. The numbers work out for a three-year term. We acknowledge it’s not without risk. Yes, it’s aggressive, but if we’re going to fix the problem we have to be aggressive.

“The interest is growing. You’re not going to fix the problem by relying

on economic growth. The increase in interest alone can eat up the growth in GDP.” Mr Turnquest agreed that, given the scale of the sacrifice demanded from the Bahamian people, there was “no doubt” the government had to deliver on its fiscal targets and produce real benefits that taxpayers can feel within the set timelines.

He rejected assertions that the VAT rate hike would not deliver the $400m gross revenue increase projected by the budget, adding: “Barring unforeseen events I feel that we ought to be able to make the targets.

“When it comes to revenue measures it’s difficult to say with 100 percent confidence because things happen, things change, but we feel we’ve been reasonable enough, conservative enough in our estimates to reach them.”

The likes of Mr Bowe and Sir Franklyn Wilson have warned that a 60 percent VAT rate increase does not necessarily translate into a 60 percent revenue rise, as projected by the budget.

They have suggested that the increase, coupled with the creation of numerous exemptions, has created avoidance incentives and VAT compliance loopholes.

As for the explosive growth in the government’s

tax take, Mr Turnquest said this largely reflected VAT’s introduction as revenues were aligned with the true cost and size of the public sector.

“There’s been consistent under-budgeting and consistent deficits over the term,” he added of the 20132014 and 2020-2021 period.

“It points to the fact expenditure is growing at a rate not sustainable by the growth of the economy, and the correction to fix it is necessary.”

The deputy prime minister has also spoken at length about the need to reverse the “upside down” nature of the Bahamian economy, and the previous administration’s reliance on the public sector - rather than the private sector - to drive job creation and GDP growth.

When Tribune Business pointed out that the fallout from the VAT rate hike might undermine this objective, Mr Turnquest replied: “One is not necessarily mutually exclusive to the other.

“Any retool is going to take a number of years because of the sheer size the public service has been allowed to grow into. Downsizing is not going to be easy; it’s not going to be shortterm. We start the process of retraining, outsourcing and reduce the deficit that way.”

He added that the reduction and elimination of various excise and import tariffs, driven partly by the WTO accession, would also give “more control and power” to the private sector.

VAT is a regressive consumption-based tax, which falls disproportionately on lower income Bahamians who see a greater percentage of their income eaten up by taxes. The inflationary impact from the 12 percent rate will further raise living costs, and lower living standards and disposable income, which threatens to lower consumer spending, demand and overall economic activity.

Mr Turnquest, though, argued that paying off the government’s unfunded arrears will return $360m into the economy over a three-year period as much of this sum is owed to Bahamian vendors and businesses.

“It’s not as if we’re taking it and pulling it out,” he told Tribune Business. “It’s going right back into the economy.” The deputy prime minister expressed hope that Baha Mar’s opening, combined with the increase in stopover visitors and foreign direct investment (FDI) pipeline, would also “cushion some of the fall-out” from the VAT increase.

FROM PAGE ONE

percent/2.5 percent between VAT and stamp duty.

But the 2018-2019 budget goes back to the ten percent stamp duty on all real estate purchases over $100,000.

KP Turnquest, deputy prime minister, said this was intended to “create a simpler formula” for real estate transactions by eliminating the VAT component.

This move, though, threatens to have the likelyunintended consequence of increasing real estate costs for both Bahamian and international buyers as developers can no longer offset their “input” VAT. Developers currently “net off” the VAT they pay on construction materials, and the likes of contractor, engineer and architect bills, against the “output” tax

whenever a property is sold.

The budget’s altered tax structure, by eliminating VAT, robs developers of the ability to claim back alreadypaid input tax, thus saddling them with a multi-million dollar increase in development costs that will likely be passed on to buyers.

Mr Rolle said the proposal under discussion would have allowed projects in progress to “recoup the VAT” on their input costs, thereby ensuring a smooth transition for a sector vital to Bahamian employment and economic growth.

“Development is the engine of this economy, and we have to be in a position where we don’t negatively impact the ability to support construction jobs, service jobs and management jobs,” he told Tribune Business. “Development is a vertically-integrated job creating mechanism; you design, you build and you operate.”

To advertise in The Tribune, contact 502-2394

increase in VAT. “We’ve been discussing it, negotiating it since the budget presentation given by the Minister of Finance.

We don’t want it to be a contentious issue. As developers it’s really incumbent to work with the government to protect the economy.”

Other developers have also warned they cannot absorb 12 percent VAT on their project costs as a result of the government reverting back to the old “transfer tax” structure.

The former Christie administration changed the ten percent stamp duty levied on real estate sales to accommodate the current VAT rate, splitting this 7.5

MARKET REPORT MONDAY, 18 JUNE 2018

t. 242.323.2330 | f. 242.323.2320 | www.bisxbahamas.com

BISX ALL SHARE INDEX: CLOSE 1,919.11 | CHG -0.04 | %CHG 0.00 | YTD -144.46 | YTD% -7.00 BISX LISTED & TRADED SECURITIES 52WK HI 4.50 19.17 7.50 3.85 1.48 0.19 4.05 8.90 6.60 5.30 11.00 2.71 1.70 8.21 6.10 11.48 7.29 13.67 12.51

52WK LOW 3.50 17.43 7.50 3.32 0.90 0.12 3.10 8.50 6.00 3.15 9.00 2.30 1.40 7.25 6.00 9.50 5.67 3.25 12.50

SECURITY AML Foods Limited APD Limited Bahamas Property Fund Bahamas Waste Bank of Bahamas Benchmark Cable Bahamas CIBC FirstCaribbean Bank Colina Holdings Commonwealth Bank Commonwealth Brewery Consolidated Water BDRs Doctor's Hospital Emera Incorporated Famguard Fidelity Bank Finco Focol J. S. Johnson

1050.00 1000.00 1000.00 1000.00

1000.00 1000.00 1000.00 1000.00

Cable Bahamas Series 6 Cable Bahamas Series 8 Cable Bahamas Series 9 Cable Bahamas Series 10 Colina Holdings Class A Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Fidelity Bank Class A Focol Class B

PREFERENCE SHARES

1.00 103.00 100.00 106.00 105.00 103.00 100.00 10.00 1.01

1.00 100.00 100.00 100.00 105.00 100.00 100.00 10.00 1.00

SYMBOL AML APD BPF BWL BOB BBL CAB CIB CHL CBL CBB CWCB DHS EMAB FAM FBB FIN FCL JSJ

E J K L M N

CORPORATE DEBT - (percentage pricing) 52WK HI 100.00

52WK LOW 100.00

CAB6 CAB8 CAB9 CAB10 CHLA CBLE CBLJ CBLK CBLL CBLM CBLN FBBA FCLB

SECURITY Fidelity Bank Note 22 (Series B) +

SYMBOL FBB22

Bahamas Note 6.95 (2029) BGS: 2015-1-3Y BGS: 2014-12-5Y BGS: 2015-1-5Y BGS: 2014-12-7Y BGS: 2015-1-7Y BGS: 2014-12-30Y BGS: 2015-1-30Y BGS: 2015-6-3Y BGS: 2015-6-5Y BGS: 2015-6-7Y BGS: 2015-6-30Y BGS: 2015-10-3Y BGS: 2015-10-5Y BGS: 2015-10-7Y

BAH29 BG0203 BG0105 BG0205 BG0107 BG0207 BG0130 BG0230 BG0303 BG0305 BG0307 BG0330 BG0403 BG0405 BG0407

BAHAMAS GOVERNMENT STOCK - (percentage pricing) 115.92 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

104.79 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

MUTUAL FUNDS 52WK HI 2.15 4.16 2.00 178.69 157.58 1.55 1.70 1.64 1.10 6.99 8.54 6.15 10.52 11.46 10.46

52WK LOW 1.67 3.04 1.68 164.74 116.70 1.49 1.62 1.58 1.07 6.41 7.62 5.66 8.65 10.54 9.57

LAST CLOSE 4.40 17.43 9.09 3.85 1.01 0.18 3.10 8.89 6.12 3.85 10.90 2.60 1.70 7.62 6.10 11.00 6.32 3.44 12.51

CLOSE 4.40 17.43 9.09 3.85 1.01 0.18 3.10 8.89 6.12 3.85 10.90 2.59 1.70 7.59 6.10 11.00 6.32 3.44 12.51

CHANGE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -0.01 0.00 -0.03 0.00 0.00 0.00 0.00 0.00

1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00

1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

LAST SALE 100.00

CLOSE 100.00

CHANGE 0.00

106.96 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

-0.45 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

107.41 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

FUND CFAL Bond Fund CFAL Balanced Fund CFAL Money Market Fund CFAL Global Bond Fund CFAL Global Equity Fund FG Financial Preferred Income Fund FG Financial Growth Fund FG Financial Diversified Fund FG Financial Global USD Bond Fund Royal Fidelity Bahamas Opportunities Fund - Secured Balanced Fund Royal Fidelity Bahamas Opportunities Fund - Targeted Equity Fund Royal Fidelity Bahamas Opportunities Fund - Prime Income Fund Royal Fidelity Int'l Fund - Equities Sub Fund Royal Fidelity Int'l Fund - High Yield Fund Royal Fidelity Int'l Fund - Alternative Strategies Fund

VOLUME

4,545 250

VOLUME

1356

500 NAV 2.15 4.13 2.00 179.39 153.02 1.55 1.69 1.64 1.09 7.15 8.14 6.41 11.26 11.68 10.24

EPS$ 0.361 0.932 -0.306 0.283 -0.973 0.000 -0.996 0.638 0.573 0.171 0.627 0.102 0.330 0.000 1.129 0.679 0.610 0.293 0.665

DIV$ 0.080 1.130 0.000 0.230 0.000 0.010 0.000 0.320 0.220 0.120 0.620 0.060 0.070 0.084 0.320 0.500 0.200 0.120 0.580

P/E 12.2 18.7 N/M 13.6 N/M N/M -3.1 13.9 10.7 22.5 17.4 25.4 5.2 N/M 5.4 16.2 10.4 11.7 18.8

YIELD 1.82% 6.48% 0.00% 5.97% 0.00% 5.56% 0.00% 3.60% 3.59% 3.12% 5.69% 2.32% 4.12% 1.11% 5.25% 4.55% 3.16% 3.49% 4.64%

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

0.00% 0.00% 0.00% 0.00% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 7.00% 6.50%

INTEREST Prime + 1.75% 6.95% 4.00% 4.25% 4.25% 4.50% 4.50% 6.25% 6.25% 4.00% 4.25% 4.50% 6.25% 3.50% 3.88% 4.25% YTD% 12 MTH% 1.23% 4.12% -0.16% 5.10% 0.74% 2.38% 4.66% 3.89% -0.25% 4.57% 1.29% 4.18% -0.61% 2.84% 1.02% 3.84% -0.87% 1.82% -1.08% 1.77% -5.96% -3.05% 1.90% 4.59% 7.24% 11.96% 2.77% 3.88% 3.94% 4.69%

MATURITY 19-Oct-2022 20-Nov-2029 30-Jul-2018 16-Dec-2019 30-Jul-2020 15-Dec-2021 30-Jul-2022 15-Dec-2044 30-Jul-2045 26-Jun-2018 26-Jun-2020 26-Jun-2022 26-Jun-2045 15-Oct-2018 15-Oct-2020 15-Oct-2022 NAV Date 30-Apr-2018 30-Apr-2018 26-Apr-2018 31-Mar-2018 31-Mar-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018

MARKET TERMS BISX ALL SHARE INDEX - 19 Dec 02 = 1,000.00 52wk-Hi - Highest closing price in last 52 weeks 52wk-Low - Lowest closing price in last 52 weeks Previous Close - Previous day's weighted price for daily volume Today's Close - Current day's weighted price for daily volume Change - Change in closing price from day to day Daily Vol. - Number of total shares traded today DIV $ - Dividends per share paid in the last 12 months P/E - Closing price divided by the last 12 month earnings

YIELD - last 12 month dividends divided by closing price Bid $ - Buying price of Colina and Fidelity Ask $ - Selling price of Colina and fidelity Last Price - Last traded over-the-counter price Weekly Vol. - Trading volume of the prior week EPS $ - A company's reported earnings per share for the last 12 mths NAV - Net Asset Value N/M - Not Meaningful

TO TRADE CALL: CFAL 242-502-7010 | ROYALFIDELITY 242-356-7764 | FG CAPITAL MARKETS 242-396-4000 | COLONIAL 242-502-7525 | LENO 242-396-3225

PUBLIC NOTICE

INTENT TO CHANGE NAME BY DEED POLL The public is hereby advised that I, ALEXUIS NOTORIOUS SHACOR BARR of Marshall Road, Nassau, Bahamas intend to change my name to KENRICK ORIAN GORDON. If there are any objections to this change of name by deed poll, you may write such objections to the Chief Passport Officer, P. O. Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of the publication of this notice.

Financial Controller A Bahamian owned company is seeking a

Financial Controller

Applicants should possess the following qualifications: Knowledge and Education: • An accounting Degree • A minimum of ten years industry experience as a financial controller in managerial capacity.

Skills: • Excellent interpersonal skills • Excellent managerial skills • Strong computer skills • Strong analytical skills • Strong oral and written skills • Able to work in a very dynamic environment Job responsibilities include the following: • Supervising the complete accounting cycle • Preparing monthly financial statements • Co-ordinating all other areas of the business to ensure optimal efficiency • Dealing with all government reporting requirements Interested persons should apply no later than June 20, 2018.

Apply to: DA #119234 c/o The Tribune P.O. Box N-3207 Nassau, The Bahamas