New legislation to guard against rogue operations – Gaskin

Scrap metal trade
– database system among measures to trace metal transactions

By Jarryl Bryan

Legislation intended to facilitate the full reopening of the scrap metal trade have been submitted to, and approved by, cabinet. Their now having been sent to the Attorney General’s Chambers, Business Minister Dominic Gaskin is confident that the draft laws would allow for a more regularised trade.

In an interview with Guyana Times, Minister Gaskin explained that the draft laws contain provisions intended to guard against vandalism of metal, theft, and rogue scrap metal operations.
“The regulations have been completed…,” Gaskin related. “The draft legislation provides for the establishment of the Scrap Metal Unit within the Ministry of Business. It provides for oversight of the Unit by a board of directors,” he detailed.
“It stipulates what licences scrap metal dealers are allowed, and what criteria they need to meet to be licensed. It distinguishes between exporters and collectors of scrap metal, as well as special conditions for salvage operators,” he explained.
Gaskin also related that the law will cover the transportation and compacting of scrap metal. Theft of scrap metal, and especially metal that cannot yet be considered scrap, are legitimate concerns for many businesses. This concern also extends to decommissioned Government equipment which are not safe from rogue operators.
According to Gaskin, the law will stipulate a time frame within which dealers must keep scrap metal, in order to prevent the disposal of someone else’s property and enhance the traceability of metal through a system. He related that dealers will be required to enter details of their transactions into a software system.
“It (the draft) speaks to issues like a timeframe between when you purchase scrap metal and when you dispose of it; so that if metal has been stolen and you’ve identified the source, you can go to the dealer and he can check his stock to see if he has indeed purchased stolen scrap metals. It’s done in other jurisdictions.
“The most important thing is that, as a dealer, you must have an approved scrap metal yard. It must be a yard that is properly approved and inspected by the Scrap Metal Unit, to ensure business is not being conducted on the parapets or streets. All your business has to be done inside the yard, so we don’t have these unsightly heaps of scrap metal (lying around on the streets),” he declared.

Outdated
In 2016, an audit carried out by Ram and McRae accounting firm into the Scrap Metal Unit had found that the laws governing the scrap metal trade needed to be completely revamped. The report had cited a number of irregularities and uncertainties surrounding the trade, including the fact that the laws governing the operations are severely outdated.
The unit has its origin in the Old Metal Dealers Act, Cap. 91:08, first promulgated in 1900. Supervisory responsibility for the unit has been transferred from the Ministry of Tourism, Industry and Commerce to the Central Housing and Planning Authority (CH&PA) by virtue of a 2012 Cabinet Paper dated January 31, 2012.
The CH&PA was conferred with specific statutory powers and duties, but those do not include regulation of the business of dealers in Old Metals, as described in the long title of the Old Metal Dealers Act 91:08.
The report has recommended that there be widespread consultation with key stakeholders before any concrete decisions are taken on the way forward in relation to the operations.
The document also pointed out that interim measures must be put in place, since the trade is currently at a standstill, and exports are temporarily banned. The auditors also noted that there is no consistent policy towards the trade, with Government opening and closing the trade at will.
Noted also is that there is seemingly a total lack of coordination between and among the four agencies involved: the Guyana Police Force, the Ministry of Business, the Scrap Metal Unit, and the Guyana Revenue Authority.
The report said it is unclear why responsibility for the trade was transferred to the CH&PA, and why no Export Duty is paid under the Customs Act.
The scrap metal trade was banned under the previous administration, and this trend had continued intermittently. The ban on the scrap metal trade came about following persistent complaints about vandalism. There were also issues regarding management of the trade.
There have been intermissions, such as the three-month reopening of the trade last year. It is understood that, as of last month, the trade has been reopened, but only on a limited basis.
At the launch of the Guyana Metal Dealers and General Exporters Association (GMD&GEA) earlier this year, executives had been heavily critical of the trade being banned and Government turning a deaf ear to the plight of would-be traders. The association had been explicit that the status quo of ‘Peter pay for all’ cannot continue.