To benefit from oil & gas opportunities, private sector readies for local content register
The new Local Content Bill proposes a register of Guyanese employees and companies and PSC Chairman Paul Cheong says that businesses will be encouraged to join this register so that they can have enhanced access to opportunities in the oil and gas sector.
The Private Sector Commission (PSC) had been part of the government-led engagements on the creation of the Local Content Bill.
And Cheong, during a recent interview with the News Room, said that the PSC was satisfied that the Local Content Bill has been finally presented to the National Assembly, and will be up for debate soon.
Importantly, he said that the register being proposed will be a useful avenue for Guyanese companies and individuals to align themselves with emerging opportunities in the nascent industry.
According to the Bill, a Guyanese company means any company incorporated under the Companies Act which is beneficially owned by Guyanese nationals who ultimately exercise, individually or jointly, voting rights representing at least fifty-one per cent of the total issued shares of the company.
“They [local businesses] have to understand why it’s necessary,” Cheong said.
He explained that a company in Guyana will not automatically qualify for the benefits offered through the proposed legislation. This legislation proposes a raft of demands on foreign companies to ensure they use Guyanese individuals and companies for everything from catering services to accounting by the end of next year.
For example, the legislation, if passed, will demand that Guyanese companies be engaged 100 engaged in providing immigration support services, work permits, visa applications, and visa on arrival. There will also be a 100 per cent demand for foreign companies to use local companies for ground transportation and custom brokerage services.
But the Bill proposes that the minister can waive the requirements if he deems any petroleum operation to be of national interest and if there is a lack of Guyanese capacity.
Cheong emphasised that many businesses in the private sector have been apprised of the value of the register. And, he said that the PSC will be encouraging its members and the wider private sector to get registered if the legislation is passed.
During an interview with the Department of Public Information (DPI) recently, Attorney General and Minister of Legal Affairs Anil Nandlall, SC emphasised that it is not compulsory for companies to join this register.
If countries do not join this register, however, they cannot be categorised as local companies and as such, will not be able to benefit from the local content provisions set out in the Bill.
For additional context, this Bill proposes the setting up of a Local Content Secretariat that will develop and maintain a Local Content Registers of Guyanese nationals for employment and Guyanese nationals and Guyanese companies from which goods and services may be procured.
The Bill proposes fines and other disciplinary measures for companies that falsely represent to be Guyanese companies to benefit from provisions under the Local Content Act.
Additionally, Guyanese nationals must hold at least seventy-five per cent of executive and senior management positions and at least ninety per cent of non-managerial and other positions.
