The Prime Minister of Dominica was a French citizen at the time of his nomination as a candidate in the 2009 general elections, The matter was challenged in court and the Prime Minister reportedly vowed in a tone of arrogance that “no law, no constitution” would prevent him from being nominated to contest the said elections. Indeed, the Prime Minister prevailed. He succeeded both politically and legally as a candidate. Unfortunately for the country, however, this serves as the foundation for more brazen manipulation, if not total violation of legal, social, and moral norms that we continue to witness-perhaps allow in Dominica years later.
Over the last twenty years at the helm of our national governance, the Prime Minister of Dominica has grown increasingly confident as a result of accumulated political currency, electoral and legal ‘victories,’ which have emboldened him to continue his disrespect for our Constitution and laws. The Skerrit-led DLP Administration is notorious for its disdain and contemptuous relationship with Dominica’s Constitutionand laws. In fact, Dominicans now accept and expect the Labour Party Administration and its wise senior counsels to stretch the interpretation of every legal provision to facilitate the operation of schemes on the thin margins of the norm. Consequently, the most basic principles of democratic governance such as requiring consultation with other stakeholders prior to taking action, even where required in law, has been converted into ‘advising or informing of action taken after the fact or to be taken.
Similar to what exists in many other Caribbean Islands, Dominica operates a Citizenship by Investment (CBI) programme, which was first introduced in 1993 under the Dominica Freedom Party (DFP) Administration led by Dame Mary Eugenia Charles. As a small Caribbean island with a population of between 65,000-72,000 people, excluding as much as 15,000-20,000 CBI citizens around the world most of whom have never visited the Island, Dominica today boasts as being one of the countries in the world with the longest-running Economic Citizenship programme.
The Constitution and the Citizenship Act of Dominica–Chapter 1:10
The CBI scheme is framed within section 101 of the Constitution of Dominica. This section mandates the Parliament of Dominica to allow the acquisition of Dominican citizenship by persons who are not eligible or who are no longer eligible to become citizens of Dominica. It states;
“There shall be such provision as may be made by Parliament for (a) the acquisition of citizenship of Dominica by persons who are not eligible or who are no longer eligible to become citizens of Dominica under the provisions of this Chapter..”
Pursuant to section 41 of the Constitution of Dominica, parliament may make laws for the peace, order and good government of Dominica, subject to the provisions of the Constitution. The Commonwealth of Dominica Citizenship Act, Chapter 1.10 was enacted as part of the laws of Dominica law. It addresses matters pertaining to the citizenship of Dominica including the governance of the acquisition of citizenship of the country. It, therefore, sets out the basic framework in sections 8 and 9 to allow individuals who participate in the CBI scheme to be granted a naturalization certificate.
As far as the CBI programme is concerned, one of the most consequential provisions of the Citizenship Act of Dominica is section 20 (1), which provides, “the Minister may by Regulations make provision generally for the carrying out of this Act or of Chapter VII of the Constitution of Dominica.” Of even more significance is section 20 (2) of the Act, which provides, “Regulations made under this section shall be subject to ‘negative resolution’ of the House.“ This means that the S.R.&O, which is secondary legislation automatically passes into law without the involvement of parliament. To reverse such legislation, a motion to annul must be tabled and passed in parliament. This procedure vests wide discretionary authority in the Minister responsible for citizenship to make Regulations and Rules pertaining to the status of our citizenship without the involvement of the Parliament of Dominica as was done with respect of SR&O No.37 of 2014 in establishing the CBI programme. Of course, in the case of Dominica where the government has a significant parliamentary majority, parliament would simply endorse the legislation in any event. That notwithstanding, some jurisdictions have changed this inherited English procedure to ‘affirmative resolution’ with respect to any fundamental changes to the Citizenship Act, whereby any secondary legislation affecting citizenship requires approval from the national parliament before it passes into law.
Statutory Rules and Orders (Regulations)
The current CBI programme of Dominica was established by the Citizenship by Investment Commonwealth of Dominica Statutory Rules and Orders (S.R &O) No. 37 of 2014. The statutory instrument was promulgated under the signature of the Minister responsible for Citizenship at the time, Hon. Alvin Bernard in accordance with his authority under Section 20 of the Citizenship Act of Dominica. Section 3 of the S.R&O established the Citizenship by Investment Unit (CIBU) with responsibility for administering the CBI Programme and for processing all applications under the programme.
As noted in Part.1 of this series, individuals applying for Citizenship under the Dominican CBI programme can do so under two (2) options namely the Economic Diversification Fund (EDF) and the Real Estate Option. The former is intended to support public and private projects within Dominica, covering industries such as education, healthcare, sport, and tourism. The latter option involves the acquisition of property interest in a project approved by the Government of Dominica. Of course, as previously observed, a hybrid Option, which is not identified in the legislation has also evolved known as the MMCE Housing Option, which is now the main revenue generator funding the construction of public housing, health centre, hospitals and may even include the funding for a proposed Skerrit International Airport. According to Prime Minister Skerrit, the cost of financing the construction of the international airport is expected to be wholly financed by the CBI Programme, It is, however, unclear which of the Options is expected to fund the proposed construction of that international airport for which the government claims to have already acquired 400 acres of land in the Wesley/Woodford hill area without having conducted any geotechnical or environmental impact studies in the area for the fairytale construction of an international airport.
With respect to the Real Estate Option, section 5. (1) of S.R&O No.37 states; “where a person (so-called ‘Investor’) executes a binding purchase and sale agreement for real estate with the ‘Developer’ of an ‘Approved Project’, an application for citizenship by investment may be submitted on his or her behalf through an authorized ‘Agent. However, some agents/promoters have now assumed the dual/triple role as financiers and developer under the programme, which amplifies the potentially corrupt nature of the programme.
Under the Real Estate Option of the CBI programme, an application for Citizenship is considered only after a government ‘Approved Project’ is deemed to have commenced, which determination shall be made in accordance with guidelines published by the CBI Unit and after all monies have been placed in an irrevocable escrow account only through a government-authorized agent, a registered trust company or with an entity whose business is the provision of trust or custodial services provided that the holders of such escrow account shall comply with guidelines published by the CBI Unit. The terms ‘approved project’ and “other development project” under the S.R.&O carry special significance under the scheme as every project, agent and/or promoter must be approved by the cabinet-not the parliament of Dominica. At the end of the day, the cabinet decides who plays in its games. It determines who wins, who benefits and who is left out in the unequal treatment of qualified others.
The minimum purchase value of real estate per section 5. (2) (a), must be in keeping with the thresholds established in paragraph 2 of the Schedule to the Regulations. The expression ‘contribution’ in the S.R&O means the minimum investment amount (by the so-called ‘investor’) in accordance with paragraph 1(2)(b) of the Schedule. However, under this Option, an acquired property interest may be ‘resold’ by a so-called investor after three (3) years of being granted citizenship-thereby affording the ‘investor’ the privilege of recouping his/her initial payment- which is deemed an investment, while he/she keeps what he/she desired in the first place and is most valuable- the Dominican Citizenship. The so-called investor moves on, while the lazy, inept and corrupt government of Dominica, its agents and developers benefit from the resale of the same real estate property and keeps reselling and reselling interests in the same property to keep the Ponzi-like scheme going to the detriment of the long-term socio-economic fabric of the Island.
As it stands today, Dominica is gradually losing its character to foreigners, who have acquired the same constitutional and legal rights as indigenous, native, born and other legitimately naturalized citizens through-line of parentage or through years of domicile in the country. In one case, it is alleged that 800 of our passports were given to one agent/developer to sell for funding a 5-star hotel on protected swamplands- hatched out of our historic national park. In another case, MMCE is said to be the legal owner of a mansion built financed from CBI funds of which the Prime Minister and his family are the beneficiaries as the lucky occupants based on a questionable decision of cabinet that saddles the state with a monthly rental and maintenance cost of over $64,00.00 to a mysterious owner of the building.
Where a person, being the holder of citizenship, seeks to sell or use the real estate in contravention to the Regulation, the following sanctions apply i.e., (a) revocation of the citizenship; (b) disqualification from further participation in the CBI programme; and (c) the nullification of any transaction purporting to sell that real estate, or if the transaction cannot be nullified or voided, damages shall be payable to the Government by that person.
S.R.&O 38 of 2016 further amended the programme essentially to reduce the amount of “investments’ and fees required as per the Schedule to the Principal Regulations. Since then there have been several adjustments to the provisions of the instrument to the extent that Dominica now has the CHEAPEST citizenship on the global citizenship market and is now providing citizenship to next of kin and relatives of the main applicants for less than US$50,000.00. What a shame!
In April 2017, the program was further amended by S.R&O No. 23 oF 2017, which deleted the original para (2) and replaced it with the following in part;
“(2) Commencing on the 1st day of September 2017, for a period of 12 months, the following shall be payable to the Unit on the application for Citizenship by Investment or other approved project: (a) on approval in principle of an application through a real estate investment or ‘other approved project’…”
One should pay particular attention to these three words ‘other approved project’, which may hold the key to understanding the vague legal framework within which MMCE operates in this potentially corrupt CBI set up that we have under the DLP Administration in Dominica. S.R.&O, No.33 of 2020 further amended the Regulations by among other things, inserting the following new definition immediately after the definition of “Approved Project” – ““Approved Project investment” means an investment into an Approved Project for the purpose of citizenship by investment of an amount not less than the threshold established in paragraph 2 of the Schedule to these Regulations”
As explored above, the legal framework of our CBI programme vests the power to a minister responsible for Citizenship and the cabinet to make Regulations pursuant to the Citizenship Act of Dominica. By virtue of this provision, the oversight role of Parliament is partially absence- not that it really matters in our parliament with an 18-3 majority and the “I’s” always have it. On this matter Parliament is essentially rendered irrelevant and powerless, which give a government with corrupt intent plenty wiggle room to manoeuvre on the edge of unethical governance, if not in the core, as the government of Dominica has been doing over the last 20 plus years.
Section 20 of the Citizenship Act of Dominica essentially empowers the government to pass Regulations and set up systems that would facilitate the government in executing its plans such as the Real Estate Option with special conditions for agents, developers, specially approved projects with special escrow accounts to divert/hide the revenues generated from the CBI programme from the Consolidated Fund in a legal construct into so-called “Specific Purpose Accounts”, which does not expose to the same level of public scrutiny and parliamentary oversight as the national budget and the management of the Consolidated Fund.
One is tempted to submit the logical argument that at the time when the Constitution of Dominica was drafted and came into effect in 1978, there was no contemplation of having such “special purpose accounts” set up specifically for the sale of Dominican citizenship-and definitely not on this grand international scale. Therefore, the present CBI set is merely a manipulation of outdated provisions of our Constitution and Citizenship Act to facilitate and legitimize a modern-day international Ponzi scheme using our citizenship as the main commodity.
The scheme is so corrupt and ill-conceived that the term ‘investor’ has been transformed to describe persons who are involved in selling our citizenship to raise funds to construct hotels in Dominica and to purchasers of our citizenship. This is an oxymoron to justify the scheme since the proceeds obtained from the sale of citizenship ought to seize to be the investor’s money with the exchange of our citizenship as the product of the business transaction. Therefore, even where the funds may be raised for a special purpose, the funds advanced cannot continue to be referred to as the money of the so-called investor in the traditional sense of the word.
By the definition ascribed to ‘approved project’ in S.R&O No.37 and subsequent amendments thereto, it appears that investments subject to escrow accounting can ONLY be via the Real Estate Option and does not apply to any funds received via the EDF Option. Hence, the MMCE Housing Option is not clearly defined in our laws of Dominica and seems to be an administrative hybrid option that combines elements of both legally prescribed Options and offering the so-called investors Dominican citizenship. This facilitates the operations of MMCE as a CBI agent, CBI promoter, CBI developer and the sole, no-bid Contractor for the construction of most major government capital projects such as the health centres, hospitals, and public housing around the Island through its subsidiary company ‘MMCE-Development and General Services Ltd.’
It is, therefore, reasonable to conclude that since Section 2 of the S.R&O governing the CBI programme specifically restricts the promotion, investment in and development of specially approved government investments and ‘other approved project’ of the government, MMCE’s Housing Option is likely classified as a hybrid option within this technical differentiation of approved government projects under the Real Estate Option. This classification allows the government to enter into special sweetheart deals with MMCE to be the leading revenue generator in the CBI market.
MMCE, a relatively small foreign company is now the primary government revenue generator, it financier and the choice awardee of government’s no-bid contracts. The company then distributes portions of its work to government supporting sub-contractors in a ‘you scratch my back, I scratch your back” arrangement to provide funds for financing the purchase of the HQ of a political party for over EC$1.9 million and to finance an election campaign that facilitates its operations with over EC $80 million dollars, while the citizens of the country are getting poorer and the Opposition parties and their members are broke.