St Kitts battling two lawsuits over CBI programme

St Kitts-Nevis is dealing with two lawsuits over its citizenship by investment or CBI programme, locally and in the United States, Prime Minister Dr Terrance Drew acknowledged on Monday.

One of the legal proceedings is a judicial review claim filed in the high court seeking an order that all citizenships granted based on investments in the country’s prison project be revoked.

The second lawsuit filed in Florida, United States, claims there was “underselling” within the programme between 2021 and 2022.

Under the CBI, foreign investors are granted citizenship of the twin-island federation in return for making substantial investments in the country’s development.

Within the context of the programme, underselling is said to occur when CBI developers seek to discount the statutory minimum investment sum required by an applicant for citizenship. The Florida lawsuit also claims that underselling practices are currently taking place in another jurisdiction.

PM Drew said he become aware of the lawsuits within the first few days of taking office, and that he immediately ordered a review of the CBI programme.

“On taking office after the 2022 general election, our administration moved expeditiously to close the legislative loopholes that facilitated underselling. Further, I immediately triggered an internal review of our CBI, from which we are still gathering the facts,” said the PM, who is also the portfolio Minister of National Security, Immigration and Citizenship.

“Our priorities were to strengthen our CBI laws, introduce good governance structures, communicate openly with our international partners about the issues we inherited, find authentic investors and, once our CBI is stabilised, review the facts to determine if any further action should be taken,” he said.

Within six months of taking office, the Drew administration introduced new regulations for the programme, which were passed into law in December 2022, prohibiting all forms of underselling. Two months later, St Kitts-Nevis signed on to the six CBI reform principles advanced at the historic US-Caribbean Roundtable on Citizenship by Investment in February 2023.

More recently, in March of this year, St-Kitts-Nevis became party to an agreement reached by countries within the Organisation of Eastern Caribbean States that operate CBI programmes to establish common standards.

“The establishment of a regional minimum investment sum (US$200,000) and the banning of underselling in the other CBI states were the key pacts therein. Further, since August 2022, we have been in constant dialogue with our international partners, especially with respect to the unfortunate outcomes from the ill-advised prison project programme,” Drew said.

As to the local lawsuit, the prime minister said he has instructed the government’s lawyer on how to proceed. Otherwise, he also noted that St Kitts-Nevis was prepared to revoke any unlawful CBI agreement, with or without the lawsuit.

“I am, and always have been, prepared to take the necessary statutory steps under the Citizenship Act to protect our federation’s good name and revoke citizenships obtained by fraud. However, I will only do so on the basis of facts and evidence, as every citizen of this country has the right to due process,” he said.

Alongside St Kitts, the other countries that signed the agreement on common standards for OECS CBI programmes were Grenada, Antigua & Barbuda, and Dominica. The agreement mandates that by June 1 all the parties would establish terms and conditions under which they will cooperate and share information to enhance the integrity, security and efficiency of the programmes.

Additionally, a regional competent authority is to be established by June 30 to set standards in accordance with international requirements and best practices and to regulate the programmes.

St Lucia too has been caught up in a lawsuit filed against a number of individuals and entities in the region, including CEO of the Saint Lucia CIP Unit, McClaude Emmanuel. However, the government has come out in defence of its official and distanced itself from the matter, saying it has no business dealings with movie producer Philippe Martinez, whose MSR Media filed the lawsuit, while stressing that the allegations relate to the CBI programme in neighbouring St Kitts-Nevis.

“For the record, Mr McClaude Emmanuel’s role as the CEO of the Saint Lucia CIP Unit is exclusively for the efficient administration of the CIP Unit in accordance with the policies set by the laws of government of St Lucia. To date, Mr Emmanuel has performed his role commendably and ethically,” the St Lucia government said.

St Lucia is the only one of the five CBI countries not yet a party to the regional CBI agreement. However, Emmanuel announced at an investment forum last Thursday that St Lucia would soon be signing the OECS agreement, but did not say by what date.

CMC