The laws of Guyana – incomplete and incorrect

Today’s column is about the laws of Guyana, a revised version of which was published in late 2013 and stated the law at December 31, 2010. Before I get to the essence of this column, let us take three specific examples.

1. In 2013 the Ministry of Labour sought to bring legislation to amend the law in relation to overtime work and pay. It is well known that at least one employer who is awarded contracts for the supply of labour to the government was breaching the amended law. The Ministry however appeared powerless to prosecute that or any other employer partly because of the clumsy and careless manner in which the amending legislation was prepared.

2. In the new Laws of Guyana, a Note of Subsidiary Legislation in the front page of the Mining Act states: “Subsidiary legislation made under this Act have been omitted due to the advanced stage of preparation of new comprehensive subsidiary legislation”. Apparently the Law Commission, which includes two senior counsel and the chief Parliamentary counsel and his deputy, did not think it necessary to include the not inconsiderable list of the omitted subsidiary legislation which apply until the new comprehensive subsidiary legislation is published.

3. Similarly, in relation to the forestry sector, a Note on Subsidiary Legislation states: “The Forests Regulations have been omitted as new comprehensive Forests Regulations are shortly to be made.” Close to four years since the effective date of the Revised Laws, those new comprehensive Forests Regulations have still not been published.

Apparently, neither “advanced stage” nor “shortly” connotes imminent to the Ministry of Legal Affairs.
Continue reading The laws of Guyana – incomplete and incorrect

Budget Focus 2008

2007 was the year of Cricket World Cup, the single largest sporting event ever held in Guyana. It was an event on which billions were spent by the Government of Guyana and the private sector, yet there has been no analysis of the returns and the extent to which expectations were met. Significantly, visitor arrival numbers were about 12% above the preceding year. With World Cup done, we do have tourism and infrastructure assets but the Stadium for example, which may have cost close to $10Bn to build, will have to be maintained at substantial annual cost.

Budget 2008 which had been planned for earlier in the year became a casualty of both the Lusignan (January 26) and Bartica (February 17) massacres. In the latter case the presentation was set for February 18th but the massacre on the evening before forced a cancellation. It was presented four days later on February 22.

Despite the extra days and the gravity of the situation only one paragraph on the Bartica massacre appears to have been added to the Budget Speech. The work of the Government and the nation must of course go on but the events of the weeks preceding the budget should have impressed on the Minister the pressing issues confronting the nation – crime, the increasing threat of flooding, inflation and the brain drain. To the extent that he dealt with any of these it was how many billions the Government was going to spend.

The ability of the economy to withstand the pressures of crime and spiralling prices will be tested in 2008 as Carifesta returns to Guyana. This and other significant events such as local government elections, the completion of the Berbice Bridge and the Skeldon Modernisation Project were the backdrop against which Minister of Finance Dr. Ashni Singh presented a G$119Bn budget – 8.5% higher that the latest estimates of 2007.

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Wanted: Charities and NGO legislation


As civil society in Guyana has taken – or rather been given – an increasing role in public-spirited tasks such as fighting floods, AIDS, poverty and discrimination – perceived and real – providing legal aid or cheap meals for the poor, those civil society organisations seeking to formalise and institutionalise themselves face more than the usual challenges of resource limitation and fundraising. Despite the fact that many of these organisations are in fact doing or complementing the work of the state, they come up with one formidable hurdle which could be so easily removed by the state. The sad fact is that there is no legislative enabling environment for the promotion of civil society, while the tax laws effectively discourage giving and fundraising through creative business initiatives. Just consider how the tax laws would treat a not-for-profit entity that decides to carry on a business to raise funds to be used exclusively in financing its charitable work. The laws will treat the surplus on the business in the same way as it would any for-profit organisation, while disallowing the expenditure on the charitable activity as not being “wholly and exclusively incurred in the production of income”!

By contrast, countries ranging from Azerbaijan and Afghanistan to Malta, Mexico, Uzbekistan, Venezuela and Zimbabwe have either enacted or advanced legislation to facilitate that type of entity known by such names as non-governmental or not-for-profit organisations. Guyana therefore lags behind all these countries in NGO/civil society legislation which for all practical purposes is simply non-existent, although the reality is less clear, certainly more confusing and does not lend itself to simple determination.

State of uncertainty

The Civil Law Act of Guyana passed in 1916 provides that the law relating to charities shall be the law of England. The problem is that the charities law of England has changed beyond recognition since 1916, and indeed, as recently as 2006 the House of Commons consolidated and updated the law into the Charities Act 2006. That act defines charities by reference to the provision of benefits to the public over some thirteen purposes, including the arts, education, health, animal welfare, sports, environmental protection and the promotion of human rights, and makes comprehensive provisions for such charities. It is unlikely that anyone would suggest that English charity law would now apply in Guyana, but that itself is a strong reason for our own National Assembly to fill this yawning gap in our legislation.

One of the results of this failure is the perennial question that often confronts the person considering the establishment of a not-for-profit organisation – whether to go the route of the Companies Act 1991 or the Friendly Societies Act Cap 36:04 of the Laws of Guyana. For the benefit of all those persons called on to make the decision, this column compares in a simple straightforward way these two principal pieces of legislation for their suitability as the appropriate vehicle to carry out their business as NGOs. Another vehicle, the Co-operative Societies Act, is excluded, since only societies for the economic advancement of their members may be established under that act.

Friendly Societies Act

Companies Act 1991

1. Scope

Limited to the types of society specified, or extended by Minister

Generally unlimited

2. Regulator

Registrar of Friendly Societies

Registrar of Companies

3. Minimum Fees to Registrar


Approximately $30,000

4. Role of Minister in establishment

May limit the application of the Act


5. Minimum number



6. Age limitation

Under 16 not allowed

Anyone can be a member but an incorporator must be at least 18

7. In case of refusal to register

Appeal to Minister

No provision

8. Legal Status

Body Corporate

Body corporate

9. Whether branches are permitted



10. Constitution

Must contain provisions relating to matters in Third Schedule of the Act

Must meet the requirements of the Companies Act but otherwise may contain any other provision

11. Audit

Must submit accounts to Registrar for audit or other person appointed to audit

Audit by person holding a practicing certificate from the Institutes of Chartered Accountants of Guyana

12. Reserve Fund


No requirement

13. Investment of surplus funds

Government or Post Office Savings Bank or Commonwealth Government or Land + Buildings

No restriction

14. Ability to Enter into Contracts



15. Loans

Must be out of separate funds established by contribution

Subject to rules set out in the Companies Act 1991

16. Taxation on Income

Automatic exemption under the Corporation Tax Act

Fully taxable unless expressly waived in a Tax Act or subsidiary legislation

An unsatisfactory winner

It would seem that there is a compelling case for organisations whose objectives fall within the Friendly Societies Act to register under that act rather than the Companies Act.

It is true that there have been far more complaints about the administration of the Friendly Societies Act compared with the Companies Act and that there is considerable scope for ministerial intervention under the Friendly Societies Act, but it is also true that there has been little evidence of any minister acting unreasonably under the act, rendering any fear baseless.

This however is not a reason for our legislature to continue to ignore the need for specific charities and related legislation that takes account of the increasing role and contribution of such organisations in the social sector in Guyana.

Such legislation ought to take account not only of the entity in its role as provider of charitable services and as a recipient of donations but also of the contributors – individuals and corporate – to such organisations.

For example, individuals who no doubt represent a significant element of total contributions can claim no deduction for any donations made for any charitable or public purpose.

On the other hand, companies are allowed to deduct donations under Deeds of Covenant and those made to the Government of Guyana for public purposes or to any prescribed organisation of a national or international character.

The retention of the status quo represents an insensitivity that is clearly undesirable and counterproductive.

Next week: The Private Sector Commission’s amazing position on the Value-Added Tax.