In the Cayman Islands, the Christmas season is the “giving season.” In the coming weeks, local philanthropic organizations will be out in force, raising funds, hosting events and distributing toys, clothes, food and other necessities in an effort to make sure that no one goes without in this most special time of year.
Even as our country’s charities ramp up their altruistic activities, Cayman’s lawmakers are bestowing upon the philanthropic community a (to be honest) rather modest gift.
Amendments passed last week to both the Non-Profit Organisations Law and the Companies Law are intended to smooth out some wrinkles in the new regulatory regime – clarifying which charitable organizations are subject to the rules, trimming paperwork and reducing fees.
Cayman’s charities will probably welcome the changes, which will provide some small respite from the government’s bureaucratic burdens that divert precious resources from nonprofits’ core missions. The amendments are better than government putting more coal in charities’ stockings but aren’t nearly dramatic enough to make it to the top of our “Dear Santa” letter.
We’d reserve that space for an appeal to repeal entirely the legislation, which has been problematic in its execution and right from its conception.
Rather than being a response to any documented or realistic threat posed by “rogue” Cayman charities, the law has always appeared to us to be an attempt to appease foreign entities, in particular, offshore regulatory bodies. The wrong-headed regulation of our local nonprofits is one of a series of moving targets imposed upon Cayman with the proclaimed purpose of combatting “money laundering,” “terror financing” and other bogeymen who would be worth taking seriously, if their existence were ever proven.
It is telling that, when presenting the latest legislation on the House floor, Financial Services Minister Tara Rivers specifically stated that the “NPO framework received positive feedback from the [Caribbean Financial Action Task Force] assessment team during their visit.” (Hooray, we suppose … but how do local nonprofits and their donors feel?)
In contrast to the hypothetical risks posed by the status quo before the Non-Profit Organisations Law, the regulatory burdens placed upon our charities are quite real, costing both time and money.
The organizers, volunteers and benefactors of Cayman’s philanthropic organizations are, as a rule, some of the finest members of our society. Rather than treating these charities and churches with the respect and reverence they merit, our lawmakers have been goaded into profiling them as potential dens for thieves and criminals.
As we wrote in May, after the Ministry of Financial Services and Home Affairs scolded and threatened nonprofits that had not jumped through the requisite hoops: “It seems our government has become confused as to who the ‘good guys’ and the ‘bad guys’ are in Cayman.”
In 2014 and again in 2016, we challenged the government and other supporters of the legislation “to present to the public one documented case of substantial abuse of a Cayman Islands charity that would justify installing the expensive and tedious bureaucratic structure contemplated under the legislation.”
We are still awaiting a response.