Dozens of suspected front businesses operate in Palau: FIB
Dozens of suspected front businesses are estimated to have been operating in Palau and most of these are in the retail business industry, according to the Foreign Investment Board.
FIB Legal Counsel and Interim Executive Director Cameron Van Tassel told Island Times in an exclusive interview that the FIB office is applying multiple strategies in implementing the newly amended law that gives the board the authority to enforce laws against front business operations in the country.
Van Tassel said that among the things they do is to look at unlicensed Bed and Breakfast accommodations, also known as BnB, and they found that some of those are front businesses.
Front businesses are those that are made to appear as if they are fully owned by Palauans yet are actually owned or financed by foreigners. These operations have been blamed for displacing Palauan citizens from competitively participating in startup businesses and employment opportunities.
“The fronts tend to be concentrated in the areas that are reserved for Palauan businesses that include tourism-related operations and retail operations, so obviously, retail is a huge sector for that,” Van Tassel said.
Although the FIB had just had the regulations in place, the office has already started on making a list of suspected front operations in Airai and down to Koror.
Last year, they had also sent notices to business operators to prove ownership.
“We fairly recently got these regulations in place but we are still working on the process of how to implement that and that is the kind of thing that will grow over time that’s when the sort of the practices become better established and our investigations and enforcement will become more efficient,” Van Tassel said.
The FIB currently has only one investigator who gets assistance from other staff of the office in conducting the operations. (Rhealyn C. Pojas)