UK imposed registers may not have dire consequences: says Hon. Fraser

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Opposition Member and Third District Representative Hon. Julian Fraser has criticised the Government’ response to the United Kingdom Parliamentary amendment on beneficial ownership which calls for registers to be made public by December 2020. During the House of Assembly sitting on 19 July Hon. Fraser pointed out that the Territory should be mindful of calls for independence and noted matters of sanctions should the BVI become independent.

He also questioned arguments that the UK move was a constitutional breach stating that when he read the Constitution he noticed points that free the UK from adhering to various sections.

In his explanation of why the constitutional argument being cited by many in the Territory might not be valid, the Third District Representative cited section 60 of the 2007 Constitution and noted the areas the government has responsibility for, and the areas the United Kingdom via the Governor has responsibility for.

He also directed attention to clause 7 of section 60 which states that the United Kingdom word is final on matters of disagreement. Clause 7 states “In the event of any disagreement regarding the exercise of any delegated authority under subsection (4), the matter shall be referred to a Secretary of State whose decision on the matter shall be final and whose directions shall be complied with.”

In light of this section Hon. Fraser questioned whether Hon. Smith noted the Constitution clause in his decision to challenge the United Kingdom’s decision. “I want to know if this Premier and his government is reading the same document that I am reading when he talks about challenging the British Government in their actions regarding the public register. If it is so, then one of us is mistaking something somewhere along the line. I don’t see how it could be clearer than that…Every clause in this Constitution, every chapter, every section has a provision that absolves the British Government of any powers of this document, these regulations. The only people that are bound to this are us.”

“What needs to happen is: the people of this Territory need to know the truth…What we need to be doing is making sure that when the dust settles we have negotiated our way into a position we can sustain in this Territory,” Hon. Fraser added.

The Opposition Member further indicated that there was no proof that the fallout from the 2020 situation was going to be catastrophic: “I see the document that the Premier made public indicating what the consequences are for the Territory when the register goes public [but]there’s no way you can tell. I guess this is just the surmise, that this is going to happen, but the Premier has already showed that creative things can happen,” Hon. Fraser told the House.

While strengthening his point that the economy might not suffer as a result of the public register Hon. Fraser said: “It has already shown that there has been a dip, a loss in the number of companies registered for the first few months of this year compared to last year, but at the same time our revenues have gone up by some eight million dollars, so I think that we need to calm down, lose the hysteria and do what has to happen.”

The Legal plan

Following the United Kingdom amendment which stipulates that beneficial ownership registers will be made public by December 2020, Premier Smith assembled a legal team to advise the Territory and possibly challenge what was described as constitutional overreach.

However, Hon. Fraser indicated that this might not be the best approach. He told the House: “I think that creating ways of getting through this maze is the best way to do it instead of trying to talk about legal challenge.”

Hon. Fraser further quoted a 20 June, BBC article stating a response from a UK parliamentarian on news that the Government was seeking legal advice. He said, “I was reading a publication where Margaret Hodge, who tabled the amendment with former government Minister Andrew Mitchell, said ‘I would be astounded if the British Virgin Islands government chooses to waste their own taxpayers money litigating against the British Parliament now supported by the British government.”

Hon. Fraser also read excerpts from international media on reports that mention the BVI particularly as it relates to the Panama Papers scandal and Mossack & Fonseca. After reading the paragraphs, which painted a dismal picture of certain financial services practice, Hon. Fraser announced: “I think that diplomacy is a better course of action…Unless you could be posturing to the people here – ‘Oh I’m a tough guy, I’m going to fight, I’m going to this’, but if you could find a way to do it without letting them know you are doing it.”

“They know what you are doing, she knows – Margaret Hodge knows. You want to make the people of the Virgin Islands feel you are doing what you are doing, you are standing up for them whatever is necessary, that’s good…but when it’s going to create this kind of mess for you, it can’t be good,” he added.

Independence and Facing Sanctions

“In the light of all this thing with the beneficial ownership and the Bill that was passed by the UK government there has been a lot of talk, some open, some grumbling and mumbling about independence for the Virgin Islands. Some people cannot use the word independence so they use the words self-determination.

“We could go independent, we could be all kind of things, but how do you escape sanctions from the likes of the United States…How do you escape sanctions from these people. They got Iran by the neck and they are an independent country for years, a huge country. They produce their own arms, they even talk about nuclear capabilities – what do we have?” the Opposition Member asked.

In further making his point about sanctions Hon. Fraser said: “How do you face sanctions. Look at Venezuela – you name a country that they want to enforce sanctions on and they do it…What does America have to do to get our attention, they tell us if you want to come to St Thomas you have to get a visa, that is step number one, step number two they could ask you to do all kind of things,” he noted.

And what about the US dollar?

Premier Says All Options Under Consideration

During his wrap up and response to members Premier and Minister for Finance Dr. the Hon. D. Orlando Smith said that government was considering various modes of tackling the matter of beneficial ownership.

“We are looking at all angles, we are looking at discussions, we are looking at negotiations, we are looking at what the Constitutional requirements, and legal aspect of it is. As a responsible government we have to really look at all the issues that are involved so that we can come to a decision that is right for the people of this country,” Hon. Smith announced.

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