Michael Halkitis, Minister of State for Finance brought opening remarks at the International Centre for the Settlement of Investment Disputes (ICSID) - CARICOM 101 Arbitral Practice Training Workshop on March 30, 2016

The Christie administration continues its march toward the designation of The Bahamas as an international arbitration center - more particularly a regional hub - and the CARICOM 101 Arbitral Practice Training Workshop held yesterday in Nassau was an opportunity to build momentum on that march. It was also an opportunity to reiterate that the government is in the process of establishing a Law Review Committee to review the Legal Profession Act with a view to "recommending reforms necessary to make The Bahamas a welcome destination for the conduct of international dispute resolution".

The workshop was co-organized by the International Centre for the Settlement of Investment Disputes (ICSID) and the Ministry of Financial Services, and Minister of State for Finance Michael Halkitis opened it by stressing the administration's efforts at positioning this nation towards becoming a leading international arbitration center in the Ameri as.

He contended that the Caribbean is considered very conducive for foreign direct investment (FDI), spurred by a desire for economic growth, and that consequently, bilateral investment treaties (BITs) in the region will continue to grow over the next few years.

"It follows, naturally, that investment arbitration is needed for the protection of FDI in order to ensure investor's rights are safeguarded and their obligations enforced. Statistics show that the confidence of investors increases where the host state provides recourse to impartial tribunals. This allows transparency, neutrality and the safeguarding of the rule of law in a national environment," the minister said.

He added that by creating an arbitration-friendly jurisdiction, countries facilitate the flow of investments required foreconomic development and the reduction of poverty.

"The Bahamas, perhaps by the very nature of its economy as a center where there are strong financial services and investment activities, has always been a place where varying complex litigation matters have come before the courts ... There are really no winners in litigation of this nature," Halkitis said.

He also acknowledged that delays in resolving issues could result in high costs to the parties involved, which has a direct impact on the attractiveness of jurisdictions to potential investors.

"The investor and those who deal in complex financial transactions would wish to have the assurance when they operate in our respective countries that there can be swift, fair and transparent resolution. We cannot promote our respective jurisdictions as an attractive place to do business and at the same time not guarantee equitable resolutions when disputes arise. The need for arbitration, therefore, follows naturally from this and we need to strengthen this feature of legal process as a viable option," Halkitis said.

Asserting that The Bahamas is "making great strides", he spoke of a "momentum to move towards a full realization of what has to be done". As for what "has to be done", he enumerated at least two necessary initiatives.

Firstly, he reiterated the government's pledge to provide a sound legal framework commensurate with a leading international arbitration center, centered on the enactment of the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration.

"The Model Law is a widely recognized international standard for international commercial arbitration which has, in great part, been adopted on a global scale. By enacting the Model Law, The Bahamas will implement a uniform set of procedural rules which will provide foreign parties with greater predictability in the conduct of international arbitration proceedings.

"The government is also in the process of establishing a Law Review Committee to review the Legal Profession Act with a view to recommending reforms necessary to make The Bahamas a welcome destination for the conduct of international dispute resolution," Halkitis said.

Secondly, he cited the steps taken by the government towards becoming a member state of the Permanent Court of Arbitration. As a member state, The Bahamas will be poised to act as a host country for hearings administered by the Permanent Court in the region. The Bahamas will also be eligible to benefit from capacity-building training exercises offered by the Permanent Court for officials and legal practitioners in the ambit of international dispute resolution, he pointed out.

Historic
Halkitis called it "an honor" to have been included in the celebratory activities commemorating the 50th anniversary of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention) which established the Centre for the Settlement of Investment Disputes.

ICSID's record over the past 50 years shows an admirable foresight by the founders, the minister said. The Bahamas became a signatory to the ICSID Convention in November 18, 1995 and today The Bahamas has four appointees to the ICSID Panel of Arbitrators and Conciliators.

By K. Quincy Parker

Guardian Business Editor

Click here to read more at The Nassau Guardian