Members of the Guyana Bar Association and other stakeholders were part of a workshop to explore the conceptual and functional features of the draft Moveable Property Security Bill 2018.
The consultation, held at the Cara Lodge, Quamina Street, was facilitated by the Ministry of Business in collaboration with the Ministry of Legal Affairs.
Minister of Legal Affairs, Basil Williams, noted that the Bill provides for a comprehensive, integrated framework for secured transaction in movable property.
It was also noted that all movable property, under this framework, qualify as property regardless of item or type with a few exceptions.
Williams noted the policies embodied in the Bill are not major changes since they have been part of Guyana’s laws and practised in one form of the security device or other.
“The legislative framework introduces a modern, centralized electronic registry system in which authorized registrants will have direct access to the entry registry database for the purpose of entering their record of a secured transaction,” Williams explained.
The system will be built on a newly designed platform for company records and will operate in real time. The principles and policies underlined in the Bill mirror UNCITRAL’s (United Nations Commission on International Trade Law) model law on secured transactions.
“The proposed legal and institutional framework will provide Guyana with the Caribbean’s most modern legislation dealing with secured transaction. This legislation will enhance risk assessment management and mitigation for lenders. It will promote access to finance for a broader spectrum of borrowers, especially small and medium-sized enterprises,” Williams posited.
Moreover, according to Williams the issues with not having in legislation in place are, among other things, that “recourse to the Courts for enforcement, even for collateral of small value, clogs up the Courts and causes unnecessary delays, during which time the collateral depreciates, to the detriment of debtor and creditor alike…By far the most numerous secured transactions- hire purchase agreements and finance leases – are not even publicized.”
He also noted that “receivables have lost their usefulness as collateral, as a result of provisions in the Companies Act” while “farmers and miners have difficulty using their livestock and minerals as collateral”.
The Bill is also expected to facilitate infrastructure development and offshore investment in the country and prepare the way for the impending expansion of the oil and gas industry.
President of the Guyana Bar Association, Kamal Ramkarran, said the legal fraternity welcomed the collaborative effort to improve understanding of the Bill.
“This Bill provides the availability of security on movable property,” Ramkarran noted.
The Moveable Property Security Bill 2018 is part of the Ministry of Business’ efforts to improve the ease of doing business in Guyana.
The ministry has been working with the Ministry of Legal Affairs to develop a modern, secure transaction regime to facilitate the use of moveable property, both tangible and intangible to use as collateral for business and consumer lending.
The regime includes the development of a legislative framework and the establishment of an electronic collateral registry.
The government has received support from the Inter-American Development Bank.
Consultant, Professor Dr Tom Johnson, who facilitated the workshop, has been working with the Ministries in the drafting of the Bill.