The National Liquefied Petroleum Gas Project Bill (2019) sets out the operating parameters for a public-private partnership agreement that establishes a liquefied petroleum gas (LPG) terminal that, as the Bill’s Section 4 states, “shall have the exclusive right to import wholesale LPG into Belize until the expiration of the term of the Definitive Agreement”.

The “Definitive Agreement” refers to the agreement dated “10th July, 2018 between the Government of Belize and the National Gas Company (Belize ) Ltd. including any amendment, modification, replacement or restatement thereof.” And, as stated in the Bill’s preamble, the objective of the project is to establish the LPG terminal (and its related facilities) that is geared towards “the proper rationalization of cost, supply and pricing and enhanced efficient of the liquefied petroleum gas sector, to optimize quality control and in the overall interest of the public; to provide for certain exemptions from taxes and duties.”

In terms of exemptions, the Bill proposes to exempt the National Gas Company (Belize) Ltd. (the “Developer”) from duties, taxes and imposts levied or imposed under the likes of the Income and Business Tax Act, the General Sales Tax (GST) Act, Customs and Excise Duties Act, and the Exchange Control Regulation Act prior to the Commercial Operations Date. The law, in section 6a, reads:

“The Developer shall be exempt from any duties, taxes and imposts levied or imposed under the aforesaid Acts and other laws including but not limited to import duties, excise taxes, environmental taxes and general sales taxes prior to the Commercial Operations Date and shall thereafter be exempt from income and business taxes (and any other taxes in substitution thereof (if any)) from and after the Commercial Operations Date“

Throughout the life of the agreement, the Bill states that “Government shall at all times hold a minimum of twenty-five percent (25%) of the issued and outstanding shares of the Developer and the Developer shall in turn hold a hundred percent (100%) ownership interest in the Project Facility.”

The Bill also stipulates that on the fifteenth anniversary of the start of operations (the “Termination Date”), the “Developer shall transfer, pass, and otherwise vest legal and beneficial title and ownership in the Project Facility to the Government in consideration of the Government fulfilling all its obligations” under the agreement. It adds, “the transfer of the Government’s Shares to the Developer [shall be] free from and clear of any and all encumbrances.”

The Bill (section 9) also sets out the pricing methodology to be utilized in determining wholesale prices for LPG by the National Gas Company (Belize) Ltd. This methodology is elaborated upon in the Bill’s schedule.