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GOB assumes control of IBC and IMMARBE

The Government of Belize will, as of Tuesday, June 11, 2013, assume operational control of the International Business Companies (IBC) Registry and the International Merchant Marine Registry of Belize (IMMARBE)—operations which were estimated to net the Government $11 million in revenues in this year’s budget.

A statement issued by the Government of Belize today said that the Management Services Agreement under which the registries were privatized comes to an end at the close of business today. That contract, an official source tells us, involves a major financial player in Belize – British billionaire Michael Ashcroft, whose interest in the agreement links back to Waterloo Investment Holdings Limited.

Waterloo, an IBC in the British Virgin Islands, has indicated in published reports that it holds 50% interest in Belize International Services Limited, a joint venture company which operates the international open shipping and company registry business in Belize. The other major party of the agreement is Morgan & Morgan of Panama.

Amandala understands that the Ashcroft group and the Panamanian investor have controlled the operation of the registries since 1990. First, they were engaged under separate 3-year agreements: one for the IBC and the other for the shipping registry. However, in 1993, the then People’s United Party (PUP) administration issued one 10-year agreement to the parties, for both registries, with an option for a renewal for another 10 years.

The announcement today means that for the first time in 23 years—when the sectors came online—the registries are being returned to Government’s hands. The timing of the announcement is notable.

Just last month, Belize was blacklisted by the European Parliament’s Fisheries Committee on allegations of illegal, unreported and unregulated (IUU) fishing on the high seas by foreign-owned Belize-flagged vessels. Our newspaper was advised by a credible source that a major bone of contention has been Belize’s open merchant ship registry, administered by IMMARBE, which allows foreigners, including Europeans, to be able to register their vessels in Belize and land products in the EU under tax-free status, using IBCs (International Business Corporations) registered in Belize.

When Belize was warned of being blacklisted in late 2012, Prime Minister Dean Barrow told 7 News, when asked about corrective measures, that “…we are prepared, and have been prepared for a while, to give up that ship’s registry, if it were to come to that, in order to ensure the continued ability to export our aquaculture products to Europe.”

Barrow said, however, that the Government was, at the time, bound by the commercial agreement, signed by the previous PUP administration “and renewed ad infinitum.”

“So, we have to look at all our options before we can talk about the possibility about withdrawal from that commercial contract. Hopefully, it won’t come to that. It is my sense that the IMMARBE people are prepared to cooperate to delist the vessels that are, in fact, operating in the zone that is under the jurisdiction of the EU,” Barrow then told 7 News.

Amandala understands that over 100,000 companies are registered under the IBC system, and the revenues Government hopes to get from that sector in the 2013-2014 financial year amount to $10.5 million.

The IMMARBE registry—for which Belize has come under major pressure from the EU—is of lesser financial value, forecast to net the Government $626,995 in revenues for the financial year. That registry, we are told, documents nearly 900 ships which fly Belize flags and only 130 of which are fishing vessels. The bulk of the vessels are cargo vessels.

A senior Ministry of Finance source told our newspaper today that Government intends to run the registry as of tomorrow, and operations will continue out of the Marina Towers on Princess Margaret Drive in Belize City for the time being.

Government’s announcement today said, “…the Government of Belize will assume control of the two Registries with effect from tomorrow, 11 June 2013.”

Prime Minister and Minister of Finance Dean Barrow plans to address the media on this matter at a press conference slated for Wednesday, June 12, 2013.

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