Former Attorney General Aiyaz Sayed-Khaiyum says the Commercial Use of Marine Areas Bill could have a major economic and financial impact on Fiji’s tourism sector and undermine confidence in Fiji as an investment destination.
While making his submission to the Parliamentary Standing Committee on Justice, Law and Human Rights, Sayed-Khaiyum said the Bill is highly bureaucratic and he agrees with concerns raised by the Fiji Hotel and Tourism Association.
He says he was very surprised after skimming through the Bill and realising that it could have a huge impact on the tourism sector.
He says the Bill could create uncertainty for tourism operators, investors and lenders, particularly hotels that already have foreshore leases and have borrowed money using their properties as security.
He raised concerns about the proposed transfer of vested marine areas to the iTaukei Land Trust Board, saying the Board would not necessarily be required to give that area to the tourism operator whose property is adjacent to it, affecting not only the hotel operator but also the banks that financed the investment.
INSERT: Sayed-Khaiyum on tourism 12th Aug
Sayed-Khaiyum says the banks have valued hotel properties based on their existing access to the foreshore, and the changes to those arrangements could affect the security used by hotel operators.
He says the impact would extend beyond individual hotels; if the tourism industry were to decline, it would affect everyone, potentially resulting in reduced government revenue, an impact on foreign reserves and job losses.
He also warns that Fiji competes with other countries for investment and that, if Fiji becomes too uncertain, investors could move their capital to Vanuatu, Solomon Islands, Tahiti or Samoa.
He adds that Fiji needs to make its tourism sector more sophisticated and create more opportunities to generate revenue, but warns that the Bill could instead create uncertainty for the industry.
Sayed-Khaiyum also pointed to Section 27 of the Bill, saying that the TLTB could deduct an amount not exceeding 25 percent from rents and premiums received in respect of leases or licences over vested marine areas for collection and administration.
He says the TLTB's main role should be to look after landowners, ensure that they receive the correct amount of money and maintain confidence in the leasing of iTaukei land.
Opposition MP and Committee member, Faiyaz Koya raised concerns about Section 29 of the Constitution, which protects existing ownership and interests in land, leases and tenancies.
Koya questioned the Ministry of Tourism's position that Section 29 was a transitional provision and also raised concerns about the Bill's definition of marine areas, which includes reclaimed land.
He referred to developments such as Denarau and Fantasy Island and questioned how existing rights could be protected if reclaimed areas were brought within the scope of the Bill.
Sayed-Khaiyum strongly disagreed with the claim that Section 29 was transitional, saying that he did not know where the Ministry of Tourism was obtaining its advice from and that it was entirely incorrect to describe Section 29 as a transitional provision.
He explained that transitional provisions deal with arrangements needed to move from one constitutional system to another, while Section 29 protects existing rights.
He says the provision meant that existing leases could not simply be adversely affected by a new law and that a hotel affected by such a change could potentially challenge it in court on constitutional grounds.
Koya questioned whether a royalty system similar to the one used for mineral rights could be introduced for qoliqoli areas, allowing tourism operators to pay an additional annual royalty alongside existing leases and qoliqoli compensation.
Koya asked whether such an approach could provide a more equitable benefit to qoliqoli owners without requiring the proprietary rights over marine areas to revert under the proposed Bill.
Sayed-Khaiyum says the mineral royalty system could not simply be applied to qoliqoli rights because the two involve fundamentally different rights, explaining that mineral royalties relate to resources extracted from beneath land or water, while qoliqoli rights concern traditional fishing rights over a particular area.
He says qoliqoli owners are already entitled to compensation where commercial activities restrict their ability to exercise their fishing rights, adding that if the hotel is going to use that area, then they are no longer able to fish in that area, so you pay them compensation for that particular usage of that area.
Koya also questioned whether regulations under the Bill should be subject to greater parliamentary oversight, given the importance of the tourism sector.
Sayed-Khaiyum says the issue went beyond whether regulations should be referred to a parliamentary committee.
He argued that, if provisions were important enough to affect a major sector, they should be properly dealt with in the legislation itself rather than being left largely to regulations.
He also asked to make further submissions on the Bill, indicating that he would return before the committee to give his submission on the Police Bill and, should there be any outstanding matters, provide further input on this Bill.
