PM Browne Calls EU Blacklisting “Vulgar” and Borders on Racism

Prime Minister Gaston Browne

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Prime Minister Gaston Browne has voiced his dissatisfaction with the way countries like Antigua and Barbuda and others in the Caribbean are being labeled as non-compliant with the financial standards set by the European Union and other first-world countries

Browne told Parliament on Monday that many of the issues the Caribbean is being asked to address through new laws are actually more prevalent in larger countries.

He questioned why the focus is on the smaller Caribbean nations when these issues are happening on a larger scale elsewhere.

“There is a tendency to focus on small states…when you look at the ethnicity of the leadership of these countries, sometimes you wonder if they are not picking on small islands, led by black leaders…there are some people who have these flawed thinking that black leaders are intrinsically corrupt,” he said

While his colleagues tried to interrupt his comments, Browne continued to make the point saying that “we must say these things because we have to determine what is driving the focus on these small states operated by black leaders”

Browne said when you consider the lack of tax transparency in large developed countries and the prevalence of money laundering and terrorism financing in those jurisdictions, it raises questions about why these countries focus on small Caribbean nations.

“There is something vulgar in the way they characterize the Caribbean economies to suggest we are a risk to the financial system. We have never had a single case in the Caribbean for terrorism financing. Incidents of money laundering have not been regular,” he said

PM Browne criticized what he said is the unilateral and arbitrary placement of countries on the so-called ‘black-list’ or ‘grey-list’, emphasizing the need for dialogue between the countries and the EU before such actions are taken.

“We have said consistently to the European Union that they should see countries as a partner in these issues of fighting money-laundering, terrorism financing to ensure tax transparency,” he said

He said this type of approach is offensive and in “many instances, they [EU] take these measures without any dialogue, without any warning, that you take punitive action and place you on a sanctioned list; that is totally inappropriate, according to PM Browne

The prime minister emphasized that small states frequently struggle to meet the numerous requirements imposed by the EU and other entities.

“In many instances, small states lack the type of capacity to keep up to date with the myriad of changes,” he said

He pointed out that while the EU may highlight a specific issue, Antigua and Barbuda might have a different perspective, yet they are still required to make the necessary adjustments.

He suggested that the EU should consider a more collaborative approach to these issues, rather than resorting to punitive measures.

To support Prime Minister Browne’s statement, the UK’s Deputy Foreign Secretary mentioned that almost 40% of illicit funds worldwide pass through the City of London and other crown dependencies.

Andrew Mitchell also stated that the Foreign Office would pressure the crown dependencies and overseas territories to adhere to UK laws establishing public registers of beneficial share ownership.

Since the House of Commons passed legislation in 2016, the UK has encountered resistance from overseas territories reluctant to establish public registers disclosing the ultimate owners of funds in tax havens.

During a discussion at the Bright Blue think tank, Mitchell emphasized the significance of acknowledging Britain’s involvement in combating illicit funds.

According to some estimates, 40% of money laundering globally, often embezzled from Africa by corrupt businessmen, dishonest politicians, and warlords, flows through London and overseas territories and crown dependencies.

He also noted that the crown dependencies and overseas territories have not fulfilled their obligations. Mitchell anticipated that with David Cameron as foreign secretary, there would be increased emphasis on implementing open registers of beneficial ownership.

Overseas territories like the British Virgin Islands have not taken sufficient action to eliminate illicit funds.

He cautioned that if these territories want to be associated with the UK, they must also embrace UK values, which is why preventing the flow of illicit funds is crucial.

During the British chairing of the G8 group of industrialized nations in 2016, Lord Cameron prioritized the fight against illicit funds and the significance of open registers of beneficial ownership.

Following his resignation as prime minister in 2016, the government’s focus on combating corruption in overseas territories decreased.

However, in 2018, the UK passed a law mandating the government to issue a draft order imposing beneficial ownership registers by 2020, following a revolt by Conservative backbenchers. Mitchell, who was a backbencher at the time, was among the rebel Tory MPs.

The British Virgin Islands and the Cayman Islands have yet to introduce public registers and are now citing European Court of Justice (ECJ) rulings to impose restrictions on accessing the registers.

Both the BVI and the Cayman Islands are not subject to ECJ rulings.

In 2013, the BVI financial services minister Lorna Smith stated that the government would not proceed with plans to implement publicly accessible registers due to an ECJ ruling that could infringe on people’s human rights.

The Cayman Islands government subsequently mentioned that they are working on providing access to members of the public who meet the ‘legitimate interest test’ outlined in the ECJ case.

This would include access to parties genuinely seeking information to prevent or combat money laundering and terrorist financing, such as media and civil society organizations under specific circumstances in line with the ECJ judgment.