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Executive Report on Strategies in the Bahamas
ICON Group International, June 2007, Pages: 383
How to Strategically Evaluate the Bahamas
Perhaps the most efficient way of evaluating the Bahamas is to consider key dimensions which themselves are composites of multiple factors. Composite portfolio approaches have long been used by strategic planners. The biggest challenge in this approach is to choose the appropriate factors that are the most relevant to international planning. The two measures of greatest relevance are “latent demand” and “market accessibility”. The figure below summarizes the key dimensions and recommendations of such an approach. Using these two composites, one can prioritize all countries of the world. Countries of high latent demand and high relative accessibility (e.g. easier entry for one firm compared to other firms) are given highest priority. The figure below shows two different scenarios. Accessibility is defined as a firm’s ease of entering or supplying from or to a market (the “supply side”), and latent demand is an indicator of the potential in serving from or to the market (the “demand side”).
Framework for Prioritizing Countries
Demand/Market Potential Driven Firm
Relative Accessibility
Accessibility/Supply Averse Firm
Relative Accessibility
In the top figure, the firm is driven by market potential, whereas the bottom figure represents a firm that is driven by costs or by an aversion to difficult markets. This report treats the reader as coming from a “generic firm” approaching the global market - neither a market-driven nor a cost-driven company. Planners must therefore augment this report with their own company-specific factors that might change the priorities (e.g. a Canadian firm may have higher accessibility in Canada than a German firm).
Latent Demand and Accessibility in the Bahamas
This report provides an extremely detailed overview of factors driving latent demand and accessibility in the Bahamas. Latent demand is largely driven by economic fundamentals. But, latent demand only represents half of the picture. A country may at first sight appear to be attractive due to a high latent demand, but it is often less attractive when one considers at the macro level how easy it might be to serve that entire potential and/or general business risks.
Chapter 2 deals with macro-accessibility. While accessibility will always vary from one company to another for a given country, the following domains are typically considered when evaluating macro-accessibility in the Bahamas:
Openness to Trade in the Bahamas
Openness to Direct Investment in the Bahamas
Local Marketing and Entry Strategy Alternatives
Local Human Resources
Local Risks
Across these domains, a number of not-so-obvious factors can affect accessibility and risk. These are also covered in Chapter 2, which is presented from the perspective of an American firm, though it is equally applicable to most firms entering the Bahamas. This chapter has been authored by local offices of the U.S. Government. I have included a number of edits to clarify the provided information as it relates to the general strategic framework.
In Chapter 3, I summarize the economic potential for the Bahamas over the next five years for hundreds of industries, categories, and products. The goal of this chapter is to report my findings on the real economic potential, or latent demand, represented by the Bahamas when defined as an area of dominant influence. The data presented are the result of various spatial econometric and time-series forecasting models which, for each category presented, are applied to forecast and allocate latent demand across all countries of the world and major distribution centers or centers of dominant influence within each country. This is accomplished knowing that economic fundamentals (e.g. income) generally vary from one country to another within a given country over time. In this chapter, I report the allocation for each category for the Bahamas as an area of dominant influence in North America & the Caribbean and, potentially, the world.
As a whole, this report presents a strategic assessment of the Bahamas by considering an extremely broad set of factors affecting both latent demand and accessibility, as outlined in the following chapters.
MACRO-ACCESSIBILITY IN THE BAHAMAS
Economic Fundamentals and Dynamics
Government Intervention Risks
The Government and Government-owned corporations are the largest employers in the Bahamian economy, with a total work force of approximately 22,000. The Government also contributes strongly to the economy of the Family Islands, as well as Nassau, through its capital expenditures for infrastructure development.
In April 1998, the government launched the Bahamas Financial Services Board to promote The Bahamas as a financial services center. The Bahamas International Securities Exchange (BISX) was inaugurated in May 2000 and currently involves only the domestic market. Initially, BISX was funded by an investment of $125,000 by each of its 45 shareholders. Since that time, BISX has received further funding from the Central Bank of The Bahamas and the private sector in order to avoid running out of cash.
Since 1992, the Government has sold all but one of the formerly Government-owned major hotels in The Bahamas. The Government has established an independent public utilities regulatory body. The government is scheduled to announce a strategic partner for its telecommunications monopoly, Bahamas Telecommunications Corporation (BTC) in September. The following companies have submitted bids to purchase 49% shares in BTC: Bahamas Tel, comprised of the private equity departments of JP Morgan and Citibank; Blue Telecommunications, a consortium of former Bahamas Telecommunications employees; and Trans-World Telecom (Bahamas) comprised of a group of local businessmen.
The Bahamas’ primary monetary strategy is to maintain stability and expand foreign exchange reserves to purchase essential imports, maintain the parity of Bahamian and American dollars, and finance repatriation of corporate profits. Exchange controls are one tool the Government uses to maintain reserves of foreign exchange. Now that the Government is pleased with the level of external reserves, it will permit relaxation of exchange controls on the capital account. Significant progress is being made in educating the public on the importance of savings and investments.
The Bahamas obtains more than 40 percent of its operating revenues from import duties. There are no taxes on incomes of individuals or corporations. Overall, taxes and other forms of revenue amount to about 20 percent of national income, a relatively low level of taxation in comparison to many other countries. Incentives and subsidies to domestic and foreign businesses usually take the form of concessions on duties levied on imported goods and materials. Negotiations continue for a Free Trade Area of the Americas (FTAA), which is intended to reduce and eventually eliminate import duties and other barriers to trade among the countries of the Americas. This has induced the Government to examine other forms of taxation, such as value-added or sales taxes.
Infrastructure Development
The Bahamas provides good basic infrastructure for businesses. However, utility rates are considered high compared to the U.S. Privatization of the electric company BEC and the phone company, BTC -- and eventual competition in these markets -- may eventually reduce rates. Since 1992, the Government has improved some major roads both in Nassau and on the Family Islands, implemented changes to alleviate severe traffic congestion in Nassau, provided electricity and improved airports on most Family Islands, and has constructed a second bridge between Nassau and Paradise Island. Major improvements in water supplies to Nassau are completed and plans are being finalized for improvements to water systems on the Family Islands. Generally, there is regular air and sea transportation between the major developed islands and the United States. Telecommunication service is generally adequate but delays in service installation and maintenance are common. There are several Internet service providers in Nassau. Mail service is slow both among the islands and with other countries. However, the islands are serviced by several international overnight delivery services.
The Government has given Cable Bahamas approval in principle to establish an e-commerce facility -- an off-shore data center established to provide Web hosting for international companies -- in Freeport, Grand Bahama. The center will set-up and manage Web sites.
A local company, DigiTel, received a license from the government in June to provide mobile voice telephony and Internet data services over a wireless network in New Providence, Grand Bahama and Abaco.
Political Risks
The Political System
The Bahamas is a constitutional multi-party parliamentary democracy and a member of the Commonwealth of Nations. Queen Elizabeth II is the nominal Head of State and is represented in The Bahamas by an appointed Governor General. An elected Prime Minister and Parliament head the Government.
Politics and the Business Environment
No serious political movement in Bahamian history has ever advocated the nationalization of foreign property. There is little history of political violence or instability in The Bahamas, although semi-violent labor union protests erupted in early 1999 over Government plans to downsize the phone company. Overall, however, politics tend to follow the British model of combining sometimes intense rhetoric with courtly manners. The political issue of most interest to the business community is openness to foreign investment.
The Legal System
The Bahamian legal system is derived from British common law and colonial legislation, although American and other models have been used for some business legislation enacted since independence. The judiciary is independent, and conducts generally fair, public trials with the ultimate right to appeal judicial decisions to the Privy Council in London. A large legal community, most of which has received its training in Great Britain or in the Caribbean, is available to assist foreign business clients. While generally fair, the Bahamian judicial process tends to be much slower than the norm in the United States and the Embassy has received occasional reports of malfeasance on the part of court officials. There have been instances of Bahamian businessmen attempting to take advantage of delays in the judicial process and their physical proximity to gain advantages in commercial disputes with foreign firms, but there is little evidence that the Bahamian judiciary has favored local firms over foreign ones in its adjudication of disputes.
Economic Relationship with the United States
Bilateral U.S.-Bahamian relations are excellent. The Bahamas lie along the most direct air route for transport of illegal drugs between South America and the southeastern United States. The Bahamian Government cooperates closely with U.S. law enforcement agencies through “Operation Bahamas-Turks and Caicos” (OPBAT). A common language, cultural similarities, family and personal ties dating back to the days of the American Revolution (when the ancestors of many modern Bahamians first came to the islands from the southeastern United States), and the enormous number of visitors every year between the two countries have engendered an unusually high level of familiarity and ease of communication.
Marketing Strategies
Distribution and Sales Channels
Because Bahamian Government policy prohibits foreign investors from opening retail and wholesale outlets, goods intended for sale to the general public are normally purchased by local wholesalers, several of whom specialize in particular lines. The usual business practice is for wholesalers to make purchases directly from their counterparts in Florida, which is why such a large proportion of third-country products are imported into The Bahamas through the United States. Most wholesalers and some retailers, however, are willing to make direct purchase arrangements. In some cases, Bahamian retail outlets or wholesalers will enter exclusive distributorship arrangements with foreign firms.
Franchising Activities
There are a number of American franchises in The Bahamas. Most franchises are successful because they appeal to both the local community and the four million plus tourists who visit The Bahamas. Although Bahamian Government policy prohibits American foreign retail chains from opening outlets in The Bahamas, various contractual distributorship and franchise arrangements are possible.
Direct Marketing Options
Many Bahamians use credit cards and can order items by mail or telephone for delivery to The Bahamas if the exporter is willing to ship. However, import duties levied on the sales price and freight of small shipments often make such orders economically non-viable. Many Bahamians prefer to shop in person in Florida to benefit from their personal exemptions from customs duties.
Joint Ventures and Licensing Options
International investors are encouraged to establish joint ventures with Bahamian partners, although the Bahamian partner must have majority ownership. The choice of a Bahamian partner is left to the discretion of the investor. Joint ventures between international investors and Bahamians are eligible to access funding from The Bahamas Development Bank (BDB). However, the equity of the overseas investor may not be borrowed from the BDB or from the domestic capital market. Bahamians may, however, borrow a percentage of their contribution from BDB or the domestic capital market. An established joint venture is not debarred from accessing BDB funds.
Creating a Sales Office
Companies seeking to establish a representative office in The Bahamas must first obtain a business license. Licenses are issued following application to and approval by The Bahamas Investment Authority (BIA) in the Office of the Prime Minister. The BIA can be contacted at:
Bahamas Investment Authority
Ministry of Financial Services and Investments
Sir Cecil Wallace Whitfield Centre
P.O. Box N-7770
Nassau, Bahamas
Tel: (242) 327-5970
Fax:(242) 327-5907
Advertising and Trade Promotion
Advertising for any legal item or service, whether sold in The Bahamas or in the United States, can be purchased freely in any local newspaper or publication.
Leading Local Publications
The Nassau Guardian (circ. 15,000, morning daily)
P.O. Box N-3011
Nassau, Bahamas
Tel: (242) 323-5654
Advertising Manager Tel: (242) 325-4259
Fax: (242) 328-6883
The Tribune (circ. 10,000, morning daily)
P.O. Box N-3207
Nassau, Bahamas
Tel: (242) 322-1986
Advertising Manager Tel: (242) 322-2768
Fax:(242) 328-2398
The Freeport News (circ. 5,000, morning daily)
P.O. Box F-40007
Freeport, Bahamas
Tel: (242) 352-8321
The Punch (circ. 18,000, bi-weekly tabloid)
P.O. Box N-4081
Nassau, Bahamas
Tel: (242) 322-7112
Fax:(242) 323-5268
The Bahama Journal (circ. 5,000, daily)
P.O. Box N-8610
Nassau, Bahamas
Tel: (242) 325-3082
Radio and Television Stations
Radio and television advertising can also be purchased for local radio and television stations. The sole television broadcaster is the state-owned ZNS (Channel 13). This station, and its Nassau radio stations ZNS-1, ZNS-2, and ZNS-FM, can be contacted at:
Broadcasting Corporation of The Bahamas
P.O. Box N-1347
Nassau, Bahamas
Tel: (242) 322-4623 or (242) 322-4480
Advertising Sales Director:(242) 322-8962
There are four independent FM radio stations in Nassau: 100-Jamz (operated by the Tribune); Love-97 (operated by the Bahama Journal); 102.9 Island FM, and 94-More FM.
100-Jamz
P.O. Box N-3207
Nassau, Bahamas
Tel: (242) 328-4771
Fax:(242) 356-5343
Love-97 FM
P.O. Box N 3909
Nassau, Bahamas
Tel: (242) 356-4960
Fax: (242) 356-7256
94-More FM
P.O. Box N-7030
Nassau, Bahamas
Tel: (242) 361-2447
Fax: (242) 341-2448
102.9 Island FM
P. O. Box N-1807
Nassau, Bahamas
Tel: (242) 322-8826
Fax: (242) 356-4515
Selling to the Government
Businesses intending to market goods or services to The Bahamas Government or businesses seeking to enter the Bahamian commercial market are advised to seek the advice of the American Embassy in Nassau at an early stage. The Government has a nominally open procurement process for purchasing supplies, equipment and services, although some Government contracts are not put out to open bid.
Hiring Local Counsel
As in the U.S., most business transactions may be carried out without an attorney. Persons wishing to consult or retain local counsel, however, are advised to contact the Commercial Section for a list of local attorneys.
Performing Due Diligence and Checking Bona Fides
There is no local equivalent of a Dunn and Bradstreet to check the bona fides of banks, agents or customers. However, the business community is small and local attorneys or other Bahamian contacts may be able to assist. Information may also be obtained from:
The Bahamas Chamber of Commerce
P.O. Box N-665
Nassau, Bahamas
Tel: (242) 322-2145
Information on mortgages, security interests in personal property, and corporate document filings may be obtained from:
The Registrar General
P.O. Box N-532
Nassau, Bahamas
(242) 322-3316
Import and Export Regulation Risks
Trade Barrier Risks
The Bahamian Government raises approximately 60 percent of its total revenue from import tariffs, which, as a result, tend to be high. The basic ad valorem tariff for imported goods is 35 percent, but a long list of items have separate tariff rates. Among these are:
Clothing: 25 percent
Fine cut tobacco: 210 percent
Chewing tobacco: duty free
Cigars: 200 percent
Cigarettes: 210 percent and 7 percent stamp tax
Bottled water: 70 percent
Pool tables: 100 percent
Room air conditioners: 35 percent
Automobiles: 45 to 75 percent, based on the book value of the car
Automobile parts and accessories: 35 - 50 percent
Personal computers: duty free
Business computers: duty free
Stereo units: 25 percent
Satellite receivers and accessories: 35 percent
Video tapes: 10 percent
Cheese: 15 percent
Pasta: 10 percent
Water heaters: 35 percent
Televisions: 25 percent
Plumbing supplies: 25 percent
Wooden doors: 25 percent
Concrete tiles: 35 percent
Cement: duty free
Lumber: duty free, 7 percent stamp tax
All tariff rates are subject to change. In the 1996 budget, for example, the Bahamian Government lifted customs duties on a variety of imported goods, ranging from construction materials (nails, cement, sheetrock, plywood, etc.) to computers and computer parts, musical instruments and consumer electronic appliances. In the 1999-2000 budget, tariff rates fell on certain types of seasoned poultry and prerecorded videotapes, but rose for automobiles. Bahamians shopping in Florida (and elsewhere abroad) are permitted to import $300 worth of goods, duty free, twice per year.
In addition to duties, The Bahamas charges a seven percent “stamp tax” on most imports. Higher stamp taxes are charged on some duty free goods, including tourist items such as china, crystal, wristwatches, clocks, jewelry, table linens, leather goods, perfume, wine and liquor. on average, The Bahamas charges an export stamp tax of four percent on most exports from the country.
In an effort to protect domestic agricultural producers, the Government requires that a permit be granted to import more than 50 pounds of whole chickens or chicken parts, lamb or mutton, or pork legs, shoulders, or hams into The Bahamas. Permits are also required to import plants and fruits - particularly bananas, vegetables, and cut flowers. Permit applications have occasionally been denied when the Government determined that a surplus existed in locally - for products grown in the same category.
Valuations on Imports
Most imported goods are valued based on their actual cost as evidenced by an invoice. The Customs Department only honors discounts of up to three percent given by U.S. exporters. Customs officials determine the value of automobiles with reference to standard valuation guides. Freight and shipping charges are included in the value assessed.
Licenses Required for Imports
Permits are required for imports of certain items. Applications for permits should be made to the ministry indicated, as follows:
Poultry, meats, vegetables, fruits, live plants and animals: Ministry of Agriculture;
Medicines: Ministry of Health;
Slot machines, trailers and caravans for living (temporary use only): Ministry of Finance;
Firearms, fireworks, underwater guns other than Hawaiian slings: Commissioner of Police; and
Precursor and essential chemicals: Customs Department.
Documentation Required for Trade
Entry forms are required by Bahamian Customs for goods coming by sea, air or post. A genuine invoice (original or copy) is required. Goods may be cleared through Customs without a proper invoice if the importer leaves a deposit (usually double the estimated duty) and agrees to present an invoice at a later time.
Temporary Entry of Goods
Certain goods may be imported conditionally on a temporary basis against a security bond or a deposit that is refundable on the re-exportation. These include fine jewelry, goods for business meetings or conventions, traveling salesmen equipment, and equipment or tools for repair work.
Copies of current import regulations may be obtained from:
Government Publications Office
East Bay Street
P.O. Box N-7147
Nassau, Bahamas
Tel: 322-2410
Free Trade Zone Options
The City of Freeport on the island of Grand Bahama is a major free trade zone.
Adherence to Free Trade Agreements
The Bahamas is a beneficiary of the U.S. Caribbean Basin Initiative (CBI), Canada’s CARIBCAN Program, and the European Union’s LOME IV Agreement. Although The Bahamas participates in the political aspects of the Caribbean Community (Caricom), it has not entered any joint economic initiatives with other Caribbean states. The Bahamas has expressed interest in becoming a member in the World Trade Organization, and is an active participant in Free Trade Area of the Americas (FTAA) negotiations.
Investment Climate
Openness to Foreign Investment
The Bahamian Government generally encourages and offers incentives for foreign investment in all sectors of the economy except those the Government reserves exclusively for Bahamian citizens. Reserved businesses include: wholesale and retail operations; commission agencies engaged in the import/export trade; real estate and domestic property management agencies; domestic newspaper and magazine publication; domestic advertising and pu blic relations firms; nightclubs and restaurants (except specialty, gourmet and ethnic restaurants and restaurants operating in a hotel, resort complex or tourist attraction); security services; domestic distribution and building supplies; construction companies (except for special structures for which international expertise is required); personal cosmetics/beauty establishments; shallow water scalefish; crustacean, mollusk and sponge fishing operations; auto and appliance service operations; and public transportation.
Officially, the Government has targeted the following categories of businesses for foreign investors: tourist resorts; upscale condominiums; time share and second home development; international business centers; marinas; information and data processing services; assembly industries; high-tech service; ship registration, repair and other services; light manufacturing for export; agro-industries; food processing; mariculture; banking and other financial services; captive insurance companies; aircraft services; pharmaceutical manufacture; and offshore medical centers.
Benefits of investing in The Bahamas include: a stable, democratic government; relief from corporate and personal income taxes; timely repatriation of profits of approved investments; proximity to the United States; extensive air links through nearby Miami, Ft. Lauderdale and Orlando; well-developed telecommunications links; a good pool of skilled professionals; excellent tourism and conference facilities; and tariff concessions under the Caribbean Basin Economic Recovery Act, Canada’s CARIBCAN Program (grants duty free export to Canada on certain Bahamian products), and the European Union’s LOME IV Agreement. The Bahamian dollar is fixed on par with the United States dollar and the Government is firmly committed to maintaining this exchange rate.
In practice, the vast majority of successful foreign investments in The Bahamas have been in the areas of tourism and banking. The decision-making process within the Government of The Bahamas is highly centralized and major investments are subject to review and approval at the cabinet level. The Government is most interested in investments that will generate local employment, particularly in white-collar or skilled jobs. Large-scale projects in areas such as agriculture may be difficult to staff since low-wage and low-skill jobs do not appeal to most Bahamians, and because the Government is reluctant to permit importation of foreign laborers to staff these jobs, even on a temporary-permit basis. When new foreign ventures are perceived as competitors to existing Bahamian businesses or too dependent on foreign labor, the Government has responded to local concerns and withdrawn or refused the license of the foreign business.
In 1993, the Government established The Bahamas Investment Authority (BIA). It is a government agency housed in the Ministry of Financial Services and Investments. BIA is intended to provide a “one-stop-shop” to assist foreign investors with initial governmental approval of their investment applications and to cut through further red tape for approved investments. BIA is the Government’s central point of contact for foreign investment questions. Potential investors may contact the BIA at:
Bahamas Investment Authority
P.O. Box N-7770
Nassau, Bahamas
Tel: 1-242-327-5970, fax: 1-242-327-5907
www.opm.gob.bs
While The Bahamas has not yet enacted environmental legislation as extensively as that in the United States, the Bahamas Environment Science and Technology Commission (BEST) and BIA require a full accounting of the environmental impact of any industrial or agricultural schemes before investment approval is granted.
Conversion and Transfer Policies
Persons and corporations resident in The Bahamas are subject to exchange controls administered by the Central Bank in order to repatriate foreign currency. Commercial banks are authorized to deal in foreign currency and have authority delegated by the Central Bank to approve exchanges for certain current account transactions. Non-resident investors wishing to initiate operations in The Bahamas must register their operations with the Central Bank. If their projects are financed substantially by foreign currency transferred into The Bahamas, they will be given “approved status,” meaning that profits and capital gains can be converted into foreign currency and repatriated with minimal formalities.
Capital investment into The Bahamas remains subject to exchange controls, but as a practical matter these controls have not been known to inhibit repatriation of approved investment capital. Many Bahamians argue that exchange controls should be eliminated, but the Central Bank and the Government are not prepared to do so at this time, citing the need to retain sufficient foreign reserves to mount a strong defense of the currency’s one-to-one parity with the U.S. dollar.
Expropriation and Compensation
There is no evidence that the Government has ever expropriated a business, and both major political parties have stated that nationalization will not be an instrument of Government policy.
Dispute Settlement
There is no history of major investment disputes in The Bahamas, although smaller contractual and other disputes between Bahamians and foreign investors or exporters are not uncommon. The Bahamian legal system is based on English common law. The judiciary, appointed by the Governor General, is independent and there is no evidence of governmental interference in the judicial system. The highest court of appeal is the Privy Council in London.
The GCOB is considering the creation of the Caribbean Court of Justice under CARICOM to replace the Privy Council. Despite recent efforts to reduce backlogs of criminal and civil cases, resolution of court cases can be slow, sometimes taking years. The Embassy has received some reports of encounters with biased judges and malfeasance by attorneys. The Embassy has also received reports of local defendants evading payment of Bahamian civil judgments or deliberately dragging out court disputes, especially in cases involving non-resident plaintiffs.
Judgments of British courts, and of selected commonwealth countries, can be registered and enforced. Other countries’ judgments, including those of the United States, must be sued upon in court as debt, subject to all jurisdictional requirements. Judgments of Bahamian courts are payable in Bahamian dollars unless otherwise specified by agreement of the parties.
Personal bankruptcy laws are antiquated and rarely used. Companies can be and are frequently liquidated according to law. Creditors of bankrupt debtors and liquidated companies participate in the distribution of the bankrupt debtor’s or liquidated company’s estate according to existing statute. The law relating to sales of goods and some other commercial subjects are codified in The Bahamas’ statutes.
The Bahamas has been a member of the International Center for the Settlement of Investment Disputes (ICSID) since 1995. It is also a member of the Multilateral Investment Guarantee Agency, which insures investors against currency transfer restrictions, expropriation, war and civil disturbances, and breach of contract by member countries.
Performance Requirements and Incentives
The Bahamas lacks any form of taxation on income, sales, estates or inheritances. The only direct tax is a real property tax. Casinos are specially taxed, and there is a $15 departure tax levied at the airports and harbors. The principal incentives for foreign investments are concessions on import duties and property tax abatement. Tariffs in general are high but do not generally discriminate by country of origin. Incentives are offered under the following legislation:
Industries Encouragement Act: Under this law, the Government may exempt from duties the machinery, tools, equipment, and raw materials imported to construct new factories. A list of duty-exempt items is negotiated separately with each new venture.
Hotels Encouragement Act: Under this law, new hotels and resorts can be exempted from real property taxes for ten years from the date the new facility opens, and are eligible for significant tax reduction for up to ten additional years. An amendment to the Act currently before Parliament would allow the Government to grant tax relief for an additional ten years, raising the maximum length of tax abatement to thirty years. In addition, the Act allows the duty-free importation of materials used for the construction of new facilities or the substantial renovation of existing facilities acquired by new owners for a set period of time. The list of duty-free items for each project and the duration of some duty-free windows are negotiated separately for each venture.
Agricultural Manufacturers Act: This law allows any materials necessary for the construction, alteration, or repair of an agricultural factory, as well as any machinery or supplies used in establishing such a factory, to be imported duty free. An agricultural factory refers to any factory established for the purpose of manufacturing or preparing agricultural or horticultural produce of The Bahamas for sale or export.
Spirits and Beer Manufacturers Act: This law provides for the duty-free importation of materials used in the construction, alteration or repair of approved liquor distilleries or beer breweries and the duty-free importation of raw materials and equipment for liquor or beer production.
Recent amendments to the Tariff Act provide duty exemptions for construction and development on certain outer “Family Islands.”
Prospective investors should discuss the terms and conditions under which these benefits will be made available in any specific case with The Bahamas Investment Authority. Although work pe
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