‘Complicit’ local companies to face penalties for ‘rent-a-citizen’ practices – Jagdeo

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Vice President Dr. Bharrat Jagdeo on Thursday warned local companies that they will not be spared from any penalties as the government looks to crack down on “rent-a-citizen” practices.

Primarily in cases of joint ventures, “rent-a-citizen” or “fronting” refers to the unethical practice where foreign companies use local individuals or local entities as mere fronts to meet local content requirements. The actual control and benefits, however, remain with the foreign entity.

Dr. Jagdeo addressed the concern at a press conference held at the Office of the President on Thursday.

According to him, the government has upped engagements with the Guyana Revenue Authority (GRA) in hopes of finding those companies- foreign and local- undermining the local content system. Those companies will then face sanctions.

“The local companies that are complicit in this will face consequences too, not just the foreign companies,” Jagdeo said.

The Ministry of Natural Resources, in a recent statement, noted that the practice undermines the “objectives and spirit” of the Local Content Act.

Vice President Jagdeo noted that the Local Content Act will soon be updated and stronger penalties and strengthened enforcement for violations of the Act are likely. He said “loopholes” in the Act will be also be addressed.

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