Opposition Senator Wilfred Abrahams believes that any action to enhance the international business sector should be supported by people on both sides of the political divide.
Abrahams expressed that view in the Senate today as he gave his support to the International Business (Miscellaneous Provisions) Bill 2014 which would reform the law relating to international societies with restricted liability and international business companies to provide, among other things, for the licences issued to such entities to be valid indefinitely.
However, he said the area of the legislation which relates to penalties for failure to pay licence fees needs to be revisited.
If the money is not paid by January 1 of any given year, the company incurs a penalty that is equivalent of the license fee.
“Let us say that a company was in default for five years. The company incurs the penalty in year one. In respect of year one licence, it incurs that penalty every single year. However, it does not end there. Year two is considered a separate licence, so it starts to incur the penalty in respect of year two. Year three is a different licence, it starts to incur the penalty in respect of year three. So by the time year five comes around, it is paying five times the penalty on the first licence, four times the penalty on the second licence, three times the penalty on the third year. That cannot be the situation the Government intended,” Abrahams said.
“There is a company that I know that was in default for five years, so it was struck off. It sought to get re-instated and one would have thought that it would have had to pay five penalties, one for each year, but no, it actually paid about 22 penalties. That cannot possibly be what was intended.”
The attorney-at-law said he hoped to see the issue clarified.
“It is a situation of the law being unfair . . . So it says if you do not pay by January 1, you have until February 1 you will get a penalty equivalent of the licence fee, but it must be paid by February 1 that year. However, it does not say what if the penalty is not paid by February 1, then what happens. There is no suggestion that the licence is cancelled. The amendment actually compounds the problem. The Government needs to relook the payment of the penalties and clarify once and for all.”