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Deterring investors

For some time, this newspaper has been urging that the movement to a single licence structure in the telecommunications sector be acted on, and quickly, because the glacial rate of progress was hurting the sector and the economy.Those predictions have, unfortunately, come home to roost. Right now, the sector seems to spend more time litigating than it does improving its service. This newspaper is reluctant to comment further on the current dispute between Digicel, its competitors and the Department of Telecommunications, except to say that it is a shambles and doing tremendous harm to Bermuda’s reputation as a sophisticated business centre. Instead, Bermuda looks entirely amateurish.Proof of that is shown in Link Bermuda’s announcement that it will not invest any further money into Bermuda until it had “regulatory certainty”.“We are disappointed that the process is being played out in the press,” LinkBermuda COO CFO Miller Williams said. “We are looking forward to a resolution. But we want regulatory certainty with a level playing field.”Mr Williams added that he was pleased with Government statements on the single licence, which has been promised by March next year.But both Link Bermuda, which bought the Cable & Wireless operations in Bermuda, and TeleBermuda International, have lost money and customers as a result of Digicel being allowed into the long distance market. Normally, that would be the result of competition and there would be little sympathy for them. But they cannot compete with Digicel in other areas as a result of restrictions on their licences. Hence, the comments about certainty and a level playing field. And Link Bermuda’s comments about not investing further in Bermuda are entirely understandable. Why invest in a market when you don’t know what your position is from one day to the next?This is where the broader problem with this whole mess rests.Digicel claims it was given certain assurances when it committed to buying Transact and it must be assumed that without those assurances, it may not have proceeded with the deal or that the terms would have been different. Similarly, Link Bermuda would not have bought Cable & Wireless’s operations unless it had assurances about licences, competition and the business environment.Now, Link says it will not invest further until it does know where it stands.It can be argued that this is an isolated case. But the message it sends to any future investor in Bermuda is that this is not a reliable jurisdiction in which to do business, because the rules can change at any time. If it’s happening in telecommunications, what assurances are there that it will not occur in tourism, international business or anything else?At a time when Bermuda needs investment and is actively seeking overseas investors, especially for tourism, this is the wrong message to be sending out.A resolution in the Digicel dispute is needed, and quickly, and there cannot be any further delays in the granting of the single licences.