ROAD TOWN, Tortola — Junior Minister for Financial Services and Economic Development Lorna Smith has defended the government’s decision to effectively dismantle the Virgin Islands Trade Commission, arguing that the statutory body had become financially unsustainable and unnecessarily bureaucratic before it was fully operational.
The move follows the passage of the Virgin Islands Trade Commission (Suspensory) Act, 2023, which halted implementation of the Trade Commission established under legislation approved in 2020.
Smith, who assumed responsibility for trade matters after the 2023 general election, said an internal review raised serious concerns about the Commission’s viability, staffing structure and projected costs.
“Given the circumstances, a careful evaluation of the Act’s implementation became imperative,” Smith told the House of Assembly when introducing the suspensory legislation.
The Trade Commission had originally been promoted as a major reform intended to modernise trade regulation, oversee consumer protection laws and improve investment promotion in the territory. The body officially came into force in November 2022, and a board was appointed in May 2023.
However, Smith said the Commission remained largely inactive months after becoming law and lacked the infrastructure needed to operate independently.
According to the minister, government projections showed the Commission would cost approximately $1.5 million annually to operate while requiring a significant increase in trade licensing fees to become financially independent.
Smith warned that implementing the Commission in its original form could have resulted in higher costs for businesses and consumers at a time when many small enterprises were already under economic pressure.
She also criticised the transition process for Trade Department employees, saying workers had been forced to decide whether to move into the Commission before the body was fully established.
“One of my initial official duties was to attend the orientation of the board on May 15, nearly six months after the Act had become law,” Smith said. “It was on that day that I began to question the wisdom of implementing the Virgin Islands Trade Commission under our current circumstances.”
Under the revised approach, the Ministry of Financial Services, Labour and Trade resumed direct responsibility for trade policy, investment promotion and consumer affairs functions.
Smith insisted the underlying goals of the Trade Commission legislation would not be abandoned entirely, saying consumer protection and investment promotion remain priorities for the government.
“It is crucial to emphasise that the Virgin Islands Trade Commission Act, 2020 is not being repealed,” she stated during the parliamentary debate. “The bill seeks to temporarily suspend its operations.”
The decision drew mixed reactions from lawmakers and the business community. Supporters argued that the suspension would prevent unnecessary government expansion and duplication of services, while critics said it represented a setback for efforts to modernise trade regulation in the territory.
Premier Natalio Wheatley supported the suspension, saying he still believed in the concept of a Trade Commission but agreed the structure needed reassessment before implementation.
The government has since indicated that a review of the Trade Department’s operations and long-term structure remains ongoing as officials consider alternative approaches to trade administration and investment policy in the Virgin Islands.