Trinidad contravenes CARICOM treaty - PM
St. Vincent and the Grenadines Prime Minister Dr Ralph Gonsalves on Monday said insurance laws in Trinidad and Tobago contravene the Caribbean Community (CARICOM) treaty and allow the oil rich twin island republic to treat its nationals favourably following the collapse of Colonial life Insurance Company (CLICO) and subsidiary, British American Insurance Co. Ltd (BAICO).
Gonsalves told Parliament that his administration believes all policyholders affected by the collapse of the two companies should have been treated "in precisely the same manner in respect of CLICO-Trinidad".
"This is not an issue of a negotiation. This is an issue of a juridical responsibility as we see it," he said in response to a question from Opposition Leader Arnhim Eustace.
"If I might just say this first of all, widely, a number of institutions have had investment policies, annuities with CLICO-Trinidad. The position of the law in Trinidad and Tobago is that only monies which are in the statutory fund can be paid out to policyholders ordinarily resident in Trinidad & Tobago," Gonsalves said.
"We have taken the position that under the Revised Treaty of Chaguaramas that law is contrary to the equal treatment provision of the Revised Treaty of Chaguaramas and therefore has no validity."
Gonsalves said that if Trinidad & Tobago "is treating its own citizens in a particular manner, they must treat everybody in the Community in like manner".
Gonsalves said that even though there is "a deficiency of funds in the statutory fund in relation to the liabilities under the policies of CLICO-Trinidad & Tobago, there are other assets, either of CLICO-Trinidad but through its parent entity, CL Financial, in which resources from St Vincent and the other places went to purchase and we don't have those assets.
"So our position is that we have to be treated in precisely the same manner in respect of CLICO-Trinidad," he told legislators.
Gonsalves said that in the case of BAICO, "there is a slight difference because British American was a Bahamian company but all its back offices arrangements and trade were done in Trinidad and under the suzerainty, obviously, of CL Financing, a company in Trinidad & Tobago, where its body, mind and soul was resident.
"So that there is a case for the contribution from British American but not to the same extent as there is in respect of CLICO Trinidad," he added.