Cayman Islands lawmakers are set to review and approve an unprecedented number of bills in the Legislative Assembly meeting that begins Tuesday, some of which involve complex, long-standing issues that have been before parliament for more than a decade.
Opposition and independent legislators have groused in recent weeks that they do not have enough time to study and fully understand all the changes being proposed, much less to take a position on each individual matter.
“I’ve never seen before where 26 bills, 28, were on the [Legislative Assembly] order paper,” said Bodden Town MLA Anthony Eden, who has served in the assembly since 1992.
“How can legislators sensibly discuss bills like this?”
All of the bills brought before the assembly for the upcoming meeting were made public at least 21 days before the meeting date as required in the Legislative Assembly Standing Orders. However, another legislative veteran, East End’s Arden McLean, said recently that it was not merely the number of bills, but that the weightiness of some of the issues to be decided should have been considered in bringing all of these matters at once.
“The things that are coming up now are going to change your lives … and the lives of generations to come,” Mr. McLean said during a public meeting on Sept. 19. “Too much is happening now that they’re trying to push down on you. I can formulate a good enough argument, but they [the government] have the majority.”
Premier Alden McLaughlin’s office has released a list of two dozen bills to be considered in the meeting that begins Tuesday, and has commented publicly in recent weeks on a number of the laws pending before parliament.
Several bills brought before this week’s legislative meeting address various regulatory aspects of the financial services sector. None has prompted more controversy than the Non-Profit Organisations Bill.
The proposal, which started as the Charities Bill in 2010, seeks to deal with the monitoring of nonprofits through audits and the regulation of those organizations via government registration.
The legislation currently defines a nonprofit as any organization seeking public contributions as its primary purpose for philanthropic activities. The bill does not apply to charitable or voluntary organizations that are already regulated by a government entity, trusts that are registered under the Banks and Trust Companies Law and any other entities that are exempt through an order of Cabinet. Entities with gross annual revenues of at least $250,000 that remit at least 30 percent of those earnings overseas [*] must have their financial statements reviewed by an accountant and report the results to government. Those that receive under $250,000 per year may still be reviewed on a case-by-case basis.
The exemption powers given to Cabinet under the bill, if it is passed, are a major concern for Bodden Town MLA Alva Suckoo, a former government backbench lawmaker who left the Progressives political party at the end of last year.
“[This bill] gives Cabinet the authority to override the regulatory body that’s created within the law,” Mr. Suckoo said. “Cabinet can effectively pardon [a] nonprofit entity if they break the law. This law allows Cabinet to become judge and jury. It’s dangerous.”
Successive government administrations have been under pressure to pass a law regulating charitable contributions, which have been used in other countries as covers for entities that try to support money laundering or terrorism financing. Cayman is facing a mid-2017 review by the Caribbean Financial Action Task Force that will evaluate its preventive measures in those areas.
Another effort to update regulations for local attorneys also seeks to comply with international standards and has drawn a considerable number of public comments.
Various iterations of the Legal Practitioners Bill have been attempted, with an eye toward modernizing the local practice of law and complying with internationally accepted anti-money laundering and terrorist financing rules. The current bill is based on a law that took effect in 1969.
The legislation creates a new regulatory body for lawyers, called the Cayman Islands Legal Practitioners Association. This is envisioned as an industry “self-regulator” with eight attorneys appointed as its members. Five of the members must be Caymanian. If the bill is passed, the association will be responsible for promotion and training of Caymanian attorneys. It also must ensure all attorneys practicing in the Cayman Islands are suitably qualified.
The bill also creates a separate business staffing plan regime for local law firms, including rules that seek to ensure Caymanian lawyers are “properly considered” for promotions, including in overseas operations at the various law firms.
It is in the attempt to regulate offshore activities of Cayman Islands law firms that the Progressives-led administration must be particularly careful, Opposition Leader McKeeva Bush said.
“We must take a step back … and look at the bigger picture when considering these changes in the context of Cayman functioning as a key player in the global financial services industry,” Mr. Bush said, adding that he would not support the legislation as it currently stood. He proposed pushing the bill back until December to allow for more input on the issue.
For George Town MLA Winston Connolly, the issue to be resolved is one of a more local concern.
“We need to modernize how lawyers practice, their obligations code of conduct … no one is arguing that,” Mr. Connolly said. “People are missing the part where Caymanians – one set of Caymanians – the Caymanians that are born here, are not represented in the highest jobs in the profession.”
The party line
Wholesale revisions to the Cayman Islands Elections Law proposed by the administration could force independent lawmakers to join a political party, or form one of their own whether they want to or not.
“It just doesn’t make any sense at all,” North Side MLA Ezzard Miller said.
According to the rewritten section 22 of the Elections Bill: “Any group of persons whose activities indicate they come together to contest an election, shall register as a political party.”
In circumstances where such a group carries out activities that “indicate that they have come together to contest an election,” the supervisor of elections may conduct an investigation to determine whether the group’s activities indicate that it is, in fact, a political party. If the supervisor determines this is the case, the supervisor will then designate the group as a political party – with or without its consent, the bill states.
“Where a group of nominated candidates designated as a political party are aggrieved by the designation, that group of nominated candidates may, within seven days of the notification of the designation, appeal to the Grand Court against the decision of the supervisor [of elections],” the bill states. In such a case, the Grand Court would be required to hear the appeal within 14 days. No appeal can be made of the Grand Court’s decision, according to the bill. The designation of a political party, according to the bill, can be done following the nomination of candidates, which occurs about six weeks before an election.
“I guess they think they’re going to tie up me and [East End MLA] Arden [McLean], fighting us about whether we’re a political party,” Mr. Miller said Monday. “They can call us a political party all they want, we’re not a political party. It’s useless. It makes no sense.”
If a number of related bills governing the operation of Cayman’s public utilities sector and the petroleum sector are approved, Cayman will adopt a completely different way of regulating the companies that provide electricity, water and telecommunications, and petrol.
The Utility Regulation and Competition Bill seeks to establish a “one-stop-shop” for utility regulatory issues, dissolving the Information and Communications Technology Authority, the Electricity Regulatory Authority and the Petroleum Inspectorate. The Water Authority-Cayman would lose its economic regulatory function under the new proposals.
Under the new regulatory agency, the current oversight bodies will be merged into one office overseen by a nine-person board of directors. The amalgamation, first proposed in 2014, was suggested in the Ernst & Young consultancy report, seeking to save government $250,000 per year in operating costs.
The Procurement Bill (2016) – made public in September – sets up an entirely new process for public bids for anything from purchasing supplies to the construction of public buildings, focusing on a tendering process at the “department level” – meaning a lower-level committee process will first review the proposals. Those reviews will then be passed on to a new entity called the Public Procurement Committee for a secondary review.
Although the local political leadership and Cayman’s deputy governor will have a hand in appointing members of the new Public Procurement Committee, the bill seeks to place layers between their direct involvement in public bids by having senior civil servants appoint members of the initial bid committee. The three-person “departmental” bid committee will review offers for any project and then pass its recommendations on to the procurement committee, which will review it and either concur or disagree with the initial decision.
The issue of political control in the procurement process arose after former Auditor General Alastair Swarbrick noted in 2011 that certain elected officials appeared to be interfering in public tendering.
A handful of amendments to the Cayman Islands Development and Planning Law and regulations will allow for taller structures, up to 10 stories, in hotel/tourism zones in the islands without the need for greater property setbacks from the sea or the road.
The changes will also extend the time allowed for challenges to structures built without planning permission and will allow for more extensive enforcement on dilapidated properties.
The changes proposed for the planning law regulations are the result of a Grand Court decision this year that threw into question whether taller buildings in tourism zones should be built farther back from the water line.
[*] Editor’s note: Story changed to reflect the fact that audits will be required for entities with gross annual revenues of $250,000 that remit at least 30 percent of those earnings overseas.