Bridgetown welcomes end to EU “grey list” era amid global investment push

Barbados has officially been removed from the European Union’s ‘grey list’ of tax havens, marking the end of a prolonged international review process and confirming the island’s full compliance with global tax governance standards. 

The EU now names Barbados a jurisdiction that has now met all its commitments against tax fraud, evasion and avoidance, signalling a major reputational win for the country that frees businesses here from previous restrictions and positions Bridgetown as a credible hub for international investment.

In its latest list of non-cooperative jurisdictions for tax purposes published on Tuesday, the EU said Barbados is among 33 countries that cooperate with the EU and have no pending commitments. The ‘grey list’ is for countries that cooperate with the EU and have pending commitments.

In a bid to fight tax evasion, tax fraud and tax avoidance, the EU formed a ‘black’ list of countries that have failed to fulfil their commitments to comply with tax good governance criteria within a specific timeframe, and those that have refused to do so.

Newly appointed Minister of Finance Ryan Straughn described the development as a breakthrough after over seven years of “really, really, really hard work”, which he said now paves the way for Bridgetown to move full steam ahead in its promotion as a preferred investment hub compliant with all international tax and business standards.

Straughn told Barbados TODAY in an interview late Wednesday afternoon: “Over the last seven and a half years, the government has worked to address all of the issues that were highlighted on the EU black list. Along with the FATF [Financial Action Task Force] and the OECD [Organisation for Economic Cooperation and Development]. So, we have done so because the reputation of Barbados required a complete overhaul and to demonstrate that we are a well-run jurisdiction.”

“Being off the EU black list right now, and grey list is really extremely good news, because the team, led by former Attorney General Dale Marshall, met over the course of the years to address legislative matters, capacity issues of some departments, and to ensure that our mechanisms for measuring our effectiveness were in place.”

“In the past, we had situations where we had Barbadian companies that could not do certain transactions in Europe because of the issues of the EU and the black list from which we were on; and now, this signals that Barbadian companies are free to do more business within the EU and abroad.”

Bridgetown was only now being removed from the final negative list due to some delays on the part of the EU Parliament, Straughn explained.

“We had addressed all of the legislative issues that I mentioned and the regulatory issues, but because there was a delay with respect to the EU Parliament taking the recommendations from the commission, Barbados remained on the list far longer than we should have. And therefore, we did make representation because there was some consideration for conflating issues with the UAE and some other jurisdictions from which Barbados has very little to do.” 

“But because they took all of the countries together at the same time to the European Parliament, some European members of Parliament took objection to some of the countries that were in the group with Barbados; and so, that was part of the reason why we had not been removed from the list sooner.”

The minister continued: “Nevertheless, we are off now; and the extent to which this is hugely important to Barbados should not be understated, because we did work really, really, really hard over the course of the last seven and a half years to address all of the issues that were highlighted, that were impacting Barbados’ competitiveness, as well as when investors look at jurisdictions within which to do business. Then it means that Invest Barbados and Export Barbados going out to bring business to Barbados would allow investors to feel comfortable that they would be operating in a jurisdiction that has met all of the regulatory standards across the world.”

“Before this one, we were on the grey list because we had systematically been addressing a number of the key issues. The long and short of it is that right now, we are on nobody’s list; and that is the message that we need to indicate… but it didn’t just happen by happenstance. We went through all of the work, we addressed the issues, and now what we are trying to do is to make sure that we remain not just compliant, but we use the regulations as a tool to help us to grow the economy.”

The EU’s list of non-cooperative jurisdictions for tax purposes is revised twice yearly, in February and October.