Local Content Act: Guyanese being sought out by foreign companies to forge partnerships – VP Jagdeo

…says Act a gamechanger for Guyanese

Describing the Local Content Act that the People’s Progressive Party/Civic (PPP/C) Government passed last year as a gamechanger for Guyanese, Vice President Bharrat Jagdeo has revealed that foreign companies are now actively seeking out local companies with which they can form a partnership.

Jagdeo made this revelation during an appearance on a diaspora broadcast programme. According to Jagdeo, the Government saw the passage of local content legislation as a way of making sure that Guyanese could reap the benefits of the oil and gas industry.
The Vice President noted that even today, Guyanese individuals and companies are reaping those benefits and that foreign companies looking to invest in Guyana are actively seeking partnerships with locals.
“We had to get a legislative framework. We passed a tough law now, that created huge opportunities for Guyanese and Guyanese companies. And you should ask the people, the Guyanese companies here now, that the foreigners are busy now running them down. When they were treating them with disdain because now there’s a benefit to partnering with a Guyanese company.
“And in fact, we have special carve-outs. For example, transportation, and rental of buildings that run into hundreds of millions of US dollars of business, can exclusively be done by Guyanese. Security services all of those issues,” Jagdeo explained.
Describing the Local Content Act signed into law last year as a gamechanger, Jagdeo noted that this law completely changed the landscape and how foreign companies interact with Guyanese companies. This, he noted, is a promise fulfilled by the Government.
“I urge your viewers to look at how powerful that legislation is and how it has changed the landscape in terms of shifting things to Guyanese and Guyanese companies in the private sector and building capacity and employment opportunities,” Jagdeo said.
The Local Content Act lays out 40 different services that oil and gas companies and their subcontractors must procure from Guyanese companies by the end of 2022. For instance, these companies must procure from Guyanese companies 90 per cent of office space rental and accommodation services; 90 per cent janitorial services, laundry and catering services; 95 per cent pest control services; 100 per cent local insurance services; 75 per cent local supply of food; and 90 per cent local accounting services.
These are just a few of the services highlighted in the first schedule of the Local Content Act. The Local Content Act mandates penalties for oil and gas companies and their sub-contractors who fail to meet the minimum targets of the legislation, as well as those who are in breach of the Act. These fines range from as low as $5 million to as high as $50 million.
Meanwhile, the Government has also set up a Local Content Registry, in keeping with the Local Content Act which mandates the creation of a Local Content Register of Guyanese nationals for employment, and a register of Guyanese nationals and companies from which goods and services may be procured. In keeping with this mandate, two registration options are available; namely, supplier registration and employment registration.
Government has explained that, by using the Supplier Registration Portal, a Guyanese national or Guyanese company can apply for, and be issued with, a Certificate of Registration from the Secretariat for the supply of goods and/or the provision of services for petroleum operations in Guyana.
There are five steps for applicants to take in order to register, and those include the submission of applications by either electronic or hardcopy, which is then followed by acknowledgement of receipt along with a reference number for the application, and the review process would be initiated. Step three would see the relevant checks and balances conducted to either approve or deny the application.
If approval is granted, step four kicks in, which would see the issuance of a Certificate of Registration from the Local Content Secretariat for the provision of goods and/or services within the petroleum sector. The fifth step of the registration process would see the companies or individuals being granted access to the Supplier Registration Portal or the Employment Portal, to be able to access the available opportunities within the sector. The certificate is renewed annually on the date of its issuance.