GOB Amends the National Liquefied Petroleum Gas Project Bill

News date: 27 October 2021Source: https://lovefm.com/gob-amends-the-national-liquefied-petroleum-gas-project-bill/

The National Liquefied Petroleum Gas Project Bill was amended on Tuesday. The amendment allowed other companies to obtain a license to import LPG into Belize and provide for a new LPG pricing methodology. What this effectively does is put an end to the LPG monopoly which the original bill created for the National Gas Company. Speaking for the Attorney General, Education Minister Francis Fonseca explained that several former LPG importers currently have a civil suit against the government and in order to mitigate risk, the bill was passed through all three stages.

Francis Fonseca, Minister of Education: “The agreement was executed between NGCL and Government of Belize in 2018 and the National Liquefied Petroleum Gas Act was passed by the National Assembly in 2020. That act is now the subject of a legal challenge grounded primarily on the effect of the exclusive right to import conferred by section five of the act on the fundamental rights of the claimants. Under the agreement NGCL was given an indemnity that if the exclusive agreement given for them to import LPG was declared invalid or unenforceable the government would indemnify the company for any liability, loss or damage. Based on our legal advice it is important to move this amendment to seek to mitigate government’s liability. The amendments seek to achieve two things. One, delete section five from the act and replace it with a new section which provides that right to import LPG into Belize and to engage in the business of selling and distributing LPG shall be subject to section three of the Supplies Control Regulations. So it removes the right to be granted import licenses. And two, introduces a new requirement for the acquisition of LPG for importation only by way of a supervised tendering process. This prevents the practice of transfer pricing by those companies who purchase LPG for importation into Belize from affiliated companies. Further Mr.Speaker the price structure provided for in th schedule to the act is being revised to include a wholesalers margin and regulate wholesale pricing including wholesale pricing by NGCL to create a more level playing field in the wholesale distribution market. So Mr.Speaker it should be noted that NGCL has been consulted on these proposed amendments and agree on this course of action aimed as I stated before at mitigating government’s liability and exposure.”