Minister of Small Business, Entrepreneurship and Commerce, the Hon. Dwight Sutherland having a light moment with Madam Justice Jacqueline Cornelius; Michele Gibson, Senior Development Officer at High Commission of Canada and Project Team Leader; Mr. Benoit-Pierre Laramée, Director of the Caribbean Regional Programme, Global Affairs Canada; and Professor Velma Newton, Regional Project Director for IMPACT Justice on the sidelines of the opening ceremony of the IMPACT Justice Meeting at Accra Beach Resort, yesterday.
Resolving insolvency critical
Since the Bankruptcy and Insolvency Act came into force some 17 years ago, Barbados continues to see the grave impact of insolvency on its landscape.
Minister of Small Business, Entrepreneurship and Commerce, Dwight Sutherland recalled that in the case of Airone Ventures Limited (Redjet), which having sought protection under the Bankruptcy and Insolvency Act in 2011 remains as a matter before the court.
He said that this delay has left a number of creditors, and close to 100 employees unsure as to whether they will be able to recover any of the debt owed to them by the company.
The purpose of this piece of legislation is to provide a framework which allows viable businesses in distress the best opportunity to restructure their operations, prevent premature liquidation and return to profitability. In circumstances where business stabilisation is not possible, it allows creditors to mitigate their losses and maximise recoveries through an orderly scheme of distribution.
“As Minister of the Ministry of Small Business, Entrepreneurship and Commerce, I am therefore fully aware that these types of matters have serious implications, not only for investors but for employees and the Medium, Small and Micro Enterprises (MSME) sector,” he told members of the Judiciary, Attorneys-at-Law and Accounting Professionals gathered for the IMPACT Justice Meeting to Discuss Bankruptcy and Insolvency Legislation, which got underway at Accra Beach Resort, yesterday.
“However, as we battle with these issues on a domestic front, we continue to be assessed on a global scale in the World Bank’s Ease of Doing of Business Report. This report has now become a standard tool by which potential investors seek to assess the efficiency of a country’s regulation surrounding commerce, as they seek to do business across borders.”
While the topic of bankruptcy and insolvency is often considered taboo given the stigma that is usually attached to business and financial failure, Sutherland said that government recognises that it can no longer ignore its importance to economic growth and financial stability.
In fact, as Barbados seeks to become globally competitive, the Commerce Minister reiterated the Government’s commitment to implementing the relevant reforms to improve the way this country does business.
“As part of its commitment to reform, the Government would have asked the World Bank Group to conduct an assessment of our current situation as it relates to each Doing Business indicator. These indicators include areas such as starting a business, registering property, paying taxes, resolving insolvency, enforcing contracts and dealing with construction permits,” he pointed out, also revealing that the World Bank Group submitted a number of short term and medium to long term recommendations on how they can improve the investment climate in these areas.
“As a consequence, a Technical Working Group, chaired by the Honourable Prime Minister has been established to review the recommendations made by the World Bank and to develop a comprehensive strategy for implementing the recommended reforms.”
The IMPACT Justice Project is funded by the Government of Canada to the tune of CAD $19.2 million. The Project which commenced in April 2012 is aimed at improving access to justice for women, men, boys, girls and businesses in the region.
“Today, our focus is on bankruptcy and insolvency. We received the request to assist in this area from the Government of Barbados and since our research indicated that most countries in the region either have legislation dating from the first part of the 20th century or the 1980s or 1990s with no significant amendments, we decided that we would invite representatives from other Caribbean countries as well,” said Professor Velma Newton, Regional Project Director for IMPACT Justice. (TL)