The Homeowners Protection Act was designed to provide meaningful protection to homeowners by ensuring a true and proper discourse between borrowers and financial institutions and will likely become the epicentre of the mortgage market. However, the act has failed to achieve the balance that it sought to accomplish and is in dire need of reform.
The prime minister recently announced a Real Property Tax Forgiveness Programme which will provide waivers to Bahamian and non-Bahamian property owners in The Bahamas who are in arrears. The programme is aimed at collecting outstanding property taxes in order to bring persons into compliance and increase government revenue. It will also assist in easing the financial burden on property owners which has been exacerbated due to the COVID-19 pandemic and the consequential economic downturn.
The Commercial Entities Substance Requirements Act (CESRA) 2018 requires all legal entities registered in The Bahamas to comply with economic substance reporting by submitting an annual filing to the minister of finance. Economic substance reporting under CESRA must be completed within nine months of the entity's fiscal year end; however, due to the COVID-19 pandemic, the deadline in respect of reporting for 2019 has been extended to 31 January 2021.
In December 2019 Parliament passed a package of environmental bills geared towards developing, reinforcing and strengthening the laws which promote and support the management, protection, enhancement and proper use of the Bahamian environment. This article provides an overview of the Environmental Planning and Protection Act and the Environmental Impact Assessment Regulations.
The COVID-19 pandemic has disrupted commercial activity on a global scale, challenging contracting parties' ability to fulfil their legal obligations. Force majeure clauses and frustration principles may provide some relief to those which may otherwise incur liability because of non-performance. However, there does not appear to be any clear case law precedent for COVID-19, so it is uncertain whether the pandemic will be deemed a frustrating event by the courts.
A second home in The Bahamas has been a highly sought-after commodity for international buyers from time immemorial. The Bahamas is an archipelagic nation of 700 islands and cays, with each island providing its own charm and unique Bahamian culture. As the value of real property in the jurisdiction tends to hold or gradually appreciate over time, the purchase of real property remains a viable and attainable wealth-creating mechanism.
Bahamian real property is commonly held by a company which is incorporated in The Bahamas or another jurisdiction whose shares may be held by an individual or their nominee. A 'beneficial owner' is any person who is beneficially interested in the real property, including a beneficiary under a trust. This article considers the tax consequences of transferring Bahamian real property held by a company for estate planning purposes.
In response to the COVID-19 pandemic, the governor general declared a public state of emergency and implemented the Emergency Powers (COVID-19) Regulations 2020. Pursuant to the regulations, the prime minister implemented the Emergency Powers (COVID-19) (2) Order 2020 and the Emergency Powers (COVID-19) (Special Provisions) Order 2020. This article provides a summary of the provisions contained in the orders.
Restrictions on both domestic and international travel, lockdowns and curfews have been imposed in The Bahamas to restrict movement in an attempt to reduce the spread of COVID-19. While law firms have had to close their physical doors to the general public, real estate and resort development attorneys have embraced new and efficient procedures for closing transactions.
The government recently announced an ambitious rental assistance programme to assist tenants who have been economically affected by COVID-19 and are unable to satisfy their contractual obligation to pay rent. However, many pundits have questioned the legality of rental assistance during a state of emergency.
COVID-19 has forced society to embrace all things technological and forced individuals to adapt to working remotely. As it stands, court operations before the Magistrates Court and the Supreme Court are restricted to essential services until the first working day after the expiry of the Emergency Powers (COVID-19) (No 2) Order 2020, which may be extended by amendments. This article sets out what is permitted according to the judiciary's latest Mitigation Protocols concerning civil and commercial matters.
In times of crisis such as the current COVID-19 pandemic, employers and employees alike need to be aware of their rights and obligations. Employers should ensure that lay-off or short-time actions are taken with due consideration and in accordance with the Employment Act. Employees should be prepared for the possibility of being laid off or put on short time and, understanding their options under the law, work with their employer to produce the best outcome for both parties.
To encourage the rebuilding effort in Abaco, Grand Bahama and the surrounding Cays after Hurricane Dorian, tax relief is now available for real property tax, value added tax (VAT) on the conveyance of real property, business licence tax and certain import duties and VAT, provided that certain conditions are met.
The Supreme Court recently clarified its jurisdictional limits to assist in trust-related arbitrations, ruling that it has no such jurisdiction to allow service outside an action's jurisdiction. Given this ruling, parties to trust arbitration agreements must be cognisant that, notwithstanding whether their trust deeds provide for the seat of any arbitration to be The Bahamas, the court can provide only limited assistance where the arbitration is not held and the parties or assets are not in The Bahamas.
The Privy Council has determined that, notwithstanding the absence of express statutory provisions permitting service out of the jurisdiction of fraudulent preference claims, such claims are to have extraterritorial effect. This decision clarifies the law as it relates to the extraterritorial effect of fraudulent preference claims; however, it also creates difficulties for subscribers to mutual funds that may be held liable for investments made on behalf of third-party beneficiaries that are the ultimate recipients of payments.
In the 2019/2020 Budget Communication the government announced various tax reforms which came into effect on 1 July 2019. Among other things, the cap on owner-occupied property has increased from B$50,000 to B$60,000 per year and stamp duty on real property has been replaced by value added tax (VAT) at the same rates. Further, any party that is required to become a VAT registrant must have a business licence.
The Bahamas has an unregistered land system that is based on the conveyancing laws of England and Wales issued before 1925. Therefore, deeds and documents should be recorded in the Registry of Records in The Bahamas as soon as possible. Priority becomes particularly important in high-net-worth commercial and condominium development transactions.
Since 2001 international organisations such as the Financial Action Task Force have pressured offshore financial centres to pass legislation in order to increase transparency within their financial services sectors. As such, the Register of Beneficial Ownership Act recently came into effect in The Bahamas. The act seeks to create a private search registry containing details of beneficial owners of domestic and international companies in The Bahamas.
The Bahamian legislature continues to examine its existing legislation for ways to promote judicial efficiency by amending and implementing new procedures in its insolvency regime. As the global economy continues to grow and foreign companies and investors increasingly face obstacles arising from the use of offshore structures, the need for cross-border insolvency proceedings and the use of protection afforded to investors will likely continue to increase.
After finding the ideal property to purchase, what is the next step? Engage an attorney. An attorney can help to connect real estate buyers with key service providers in order to arrange, among other things, home inspections or insurance. Involving an attorney will make the difference between a smooth transaction that meets the expectations of the buyer versus one that is fraught with issues, unrealistic expectations and other obstacles which could have been avoided with the benefit of early advice and proper planning.