Monday, July 13, 2009

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Resolution critical of OECD and similar groups adopted By JUAN MCCARTNEY ~ Guardian Senior Reporter ~ juan@nasguard.com: The Inter-Amercian Bar Association (IABA) voted to adopt the spirit of a resolution requesting that the Organization for Economic Cooperation and Development (OECD) and similar groups, desist from using the policy of "naming and shaming" international financial centers like The Bahamas, in order to portray them in a negative light. Attorney Peter Maynard, who chaired the host committee of the IABA conference held in New Providence over the weekend, said that for the past 10 years The Bahamas has been in crisis with the OECD and similar organizations, as the financial services sector lives in constant fear of being 'blacklisted'. "They put us on a blacklist and they have been blacklisting us quite irrationally with very little discussion of what The Bahamas is about and about the legitimate business [interests here]," Maynard said. "The Bahamas has a legitimate right to be a financial center like anybody else." The resolution was approved by 23 out of 27 members of the committee that was appointed to consider it on Saturday, said Maynard. The language in the resolution calls for the OECD and other financial regulatory bodies to allow countries like The Bahamas to operate independently of the stringent scrutiny it has been subject to in the past without fear of repercussions. "Each country is absolutely free to operate its own choice of tax system without another country applying pressure to modify or abrogate that system," stated the resolution. "The OECD or other groups of similar interests should desist from using threats and the policy of shaming countries should be discontinued." Maynard said the resolution will "restore balance and common sense" to the debate over naming and shaming countries, which he said has been adversely affecting The Bahamas' financial services sector. "Every year we have hundreds of very well qualified (university) graduates and they are legitimately entitled to expect to go into the financial sector," he said. "Nobody should be able to say that only New York or London are legitimate financial centers and all the rest are what they call 'offshore centers' or tax havens or a 'fiscal paradise' which are derogatory terms. We are financial centers period. Not international, not offshore or any of these other derogatory variations. And our young people are entitled to expect that they can be financial professionals just like anybody anywhere else in the world." Maynard said that now the spirit of the resolution has been approved, it will be sent to a drafting committee - scheduled to meet in Miami, Florida in October - for some minor adjustments to the language to be made. "Someone did raise the question about whether the OECD should be named specifically," Maynard said. "So the committee will probably remove the OECD by name and speak to organizations like the OECD because there are many of them out there that are like the OECD that have the same practice." In April, the OECD named The Bahamas on a list of 38 jurisdictions that have failed to substantially implement the internationally agreed tax standard. It came the same day global leaders vowed to crack down on tax havens while declaring an end to bank secrecy. Following a meeting in London, the G-20 nations said in a communiqué: "We agree to take action against non-cooperative jurisdictions, including tax havens. We stand ready to deploy sanctions to protect our public finances and financial systems. The era of banking secrecy is over. We note that the OECD has today published a list of countries assessed by the Global Forum against the international standard for exchange of tax information." There have been growing concerns that so-called tax havens have substantially contributed to the global economic crisis that is still unraveling. The OECD progress report noted that The Bahamas committed in 2002 to the internationally agreed tax standard, which was developed by the OECD in cooperation with non-OECD countries. Prime Minister Hubert Ingraham said earlier this year that The Bahamas reaffirms its commitment recorded in a March 2002 agreement with the OECD and recognizes significant advances in commitments to broader application of OECD standards of transparency. Monday, July 6, 2009