Special economic zones, customs get legal assistance

 

A number of measures aimed at assisting the development of Cayman’s proposed Special Economic Zone were approved in key votes by the Cayman Islands Legislative Assembly last week.  

To assist in luring certain companies into the zone – which will be known as Cayman Enterprise City – certain concessions were made on import duty tariffs and those operating within the special economic zone will also be exempted from certain aspects of the country’s Immigration Law. The zone is being set up to bring in companies from outside Cayman to do global business in areas like information technology, media, and biotechnology. Membership in the zone would require those firms not compete with any local companies in Cayman.  

The areas of proposed exemption from Cayman’s Immigration Law include, according to a copy of the Immigration (Amendment) (No. 4) Bill, 2011, the removal of advertising requirements for jobs and of training requirements for Caymanians. Provisions for special economic zone companies to have a business staffing plan would be made not applicable to those companies.  

There are certain sections of the Immigration Law that require the various immigration-related boards or the chief immigration officer to consider aspects of a work permit application including; the professional and technical qualifications of the worker and the economic or social benefits he or she may bring to the Islands. Also, certain requirements that pertain to the protection of local interests must be considered when weighing applications for a work permit approval. 

According to the bill, those specific areas would not be applicable to companies working within the special economic zone.  

In addition, companies working within the special economic zone would not have to apply for a change in a work permit if their employees’ job was re-designated or if that worker was promoted.  

Despite the relaxation of certain requirements within the Immigration Law for special economic zone companies, Premier McKeeva Bush told lawmakers on Thursday there would be a focus on both education and employment of Caymanian workers within the zone. Those measures include the development of a career development bureau which will be directed by the Special Economic Zone authority. 

“There will be a mechanism in place to support opportunities for Caymanians in special economic zones,” Mr. Bush said.  

Other bills given approval on a key second reading before the house Thursday included changes to the Exempted Limited Partnership Law and the Companies Law that make it easier to identify companies working within the special economic zone and to prevent them from competing with local firms.  

 

Customs fines 

Another bill approved on second reading by lawmakers Thursday would allow individuals or businesses that open sealed cargo containers prior to their inspection by customs officers to face fines of up to $100,000 upon conviction.  

The fine, proposed as part of an amendment to the Customs Law, would raise the current fine of $1,000 for opening sealed containers by 100-fold. It seeks to eliminate what’s been a continuous problem for customs during the past 15 years, according to customs officials.  

According to Customs Collector Carlon Powery, individual containers shipped to the Cayman Islands are often sent to the business property or even the homeowner’s residence – partly because of available space issues and partly to facilitate business operations.  

Often those containers are taped off or even locked prior to customs officers arriving on the property to inspect the cargo and collect appropriate duty for the items.  

Customs officers will sometimes arrive to conduct the inspection and find the containers have been opened, Mr. Powery said.  

Given the relatively low current fine for breaking the cargo container seals, the customs collector said it is often more profitable for a company or resident to break the law and pay the $1,000 fine, rather than pay thousands of dollars more in duty on items that may have been removed. 

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