BASSETERRE - May 19, 2023 (GLOBE NEWSWIRE) -- Citizenship by Investment (CBI) programmes are often evaluated based on security, protection of property and human rights as well as general stability. The rule of law is a principle that is typically used to test the strength of a country’s system of laws. For countries like St Kitts and Nevis which offer CBI programmes, having favourable laws that are applied fairly is important because it enhances their capacity to attract more investors while upholding the integrity of their CBI initiatives.
Rule of law refers to the mechanisms, processes and institutional practices that support the equality of all persons before a country’s laws. This implies that the creation and enforcement of laws must be legally regulated so that no one is above the law. In countries where the rule of law is strong, the application and adjudication of the law by governing officials are impartial. On the other hand, a weak rule of law is characterised by the consideration of class, economic or political status and relative power in the application of the law.
St Kitts and Nevis ranked 40 out of 139 countries in the 2021 Rule of Law Index. In the year 2022, the country ranked 39 out of 140 countries, indicating a slight increase. At a regional level, consisting of 32 countries in the Latin America and Caribbean region; St Kitts and Nevis was ranked 7th and 5th in 2021 and 2022 respectively. The rule of law index measures how the rule of law is perceived and experienced globally. Rankings in the index are based on the following pillars:
Constraints on government powers;
Absence of corruption;
Order and security;
Civil justice; and
The first pillar measures the extent to which those who are in governing positions are bound by the law. Various checks such as the existence of a free and independent press, the limitation of government powers by the legislature or the judiciary as well as the independent auditing of government activities determine government powers. In 2022, St Kitts and Nevis had a global ranking of 45 out of 140 and a regional ranking of 7 out of 32 on the constraints of government powers.
With regards to the absence of corruption, St Kitts and Nevis scored a global ranking of 41 out of 140 and a regional ranking of 7 out of 32 in the year 2022. These ratings indicate that the prevalence of bribery, informal payments and embezzlement of public funds is significantly low in the judicial, military and law enforcement spheres.
The third pillar which is open government, measures the openness of a government. This is principally indicated by the extent to which a government shares information, encourages citizen participation in policy-making and is held accountable. Globally, St Kitts and Nevis was ranked 86 out of 140 whereas regionally, it was ranked 23 out of 32.
In St Kitts and Nevis, individuals are free from discrimination based on socio-economic status, gender, ethnicity, sexual orientation or religion. In addition to this, the right to life of a person and fundamental labour rights are effectively guaranteed. These observations are supported by St Kitts and Nevis’s global ranking of 35 out of 140 and a regional ranking of 7 out of 32 on the fundamental rights factor.
When it comes to order and security, St Kitts and Nevis was ranked 49 out of 140 globally, and an impressive 4 out of 32 regionally. This indicator is particularly important for investors who want to settle in the country without having to worry much about their security. Rating highly in this pillar means that in St Kitts and Nevis, the prevalence of common crimes such as homicide, kidnapping, armed robbery and theft is low. It also means that people in the country are considerably protected from civil conflict and terrorism.
The enforcement of labour, environmental, consumer and public health regulations has an implication on a country’s rule of law. In the regulatory enforcement pillar, St Kitts and Nevis had a global and regional rating of 34 out of 140 and 2 out of 32 respectively. The ratings indicate that in St Kitts and Nevis, government regulations are applied and enforced without improper influence.
St Kitts and Nevis ranked high in the civil and criminal justice pillars of the rule of law index. For the year 2022, the country ranked 24 out of 140 in civil justice, and 36 out of 140 in criminal justice. Regionally, St Kitts and Nevis occupied the 2nd position out of 32 in civil justice and 5th position out of 32 in criminal justice. People living in the country can access and afford civil as well as criminal justice compared to other countries in the world. This also means that these two systems are relatively free of discrimination, improper political influence, corruption and unreasonable delays among other hindrances.
The rule of law is particularly important for investors because it has a bearing on property rights. St Kitts and Nevis have the rule of law embedded in their CBI programmes. This gives investors a guarantee that their property rights are upheld at all times. The comparatively high rule of law index ranking, along with a strict due diligence process make St Kitts and Nevis a great choice for investments through CBI programmes.
Earlier this year, the St Kitts and Nevis government formally established the Citizenship by Investment Unit (CIU) Board of Governors. This body advises the Prime Minister on the management, operation, reviewing and monitoring of the development of CBI policies. A technical committee that is in charge of ensuring due diligence checks are completed on all CBI applications was also established by the government. St Kitts and Nevis, which has the world’s longest-standing CBI programme in the world has been setting the standard in the CBI industry for decades. The dual island was ranked top in terms of its meticulous commitment to due diligence according to the 2022 CBI Index.