Independence is no shield

January 8, 2002

Dear Sir,

Magnus Henagulph reports on a UPI story "Euro may force independence" for Bermuda and other British Overseas Territories who wish to remain in the offshore banking business. It is hard to see how a currency alone could influence political status. A common, if unacceptable tax policy might, but there are many distant bridges to cross before such an event occurs.

The UPI story, which appears to have transposed Bermuda for the Caribbean banking island of Cayman, further mixed up the issue by identifying us as a 'Crown Colony,' and in the Caribbean, neither of which we are.

The muddle is compounded by a 'leading local lawyer' who claims there is intense EU pressure, via the UK, to end Bermuda's 'traditional banking advantages'. The unmentioned Cayman is the banking centre of the Caribbean, with over a thousand banks. Bermuda, with only two or three, is (thankfully) not in the same league or business.

Bermuda's traditional banks are international, and widely respected. Cayman's operations may well attract jaundiced looks by some tax authorities that would see their lives made easier if the place did not exist. It certainly seems that the media has confused us with Cayman. It is not the first time. We should be careful not to mislead by sensationalising international press reports (especially if they could be based on mis-assumptions) that suggest that "independence" for us is any solution to protecting Bermuda's present financial and insurance relationships with the industrialised world.

Political independence will be no protection, and in fact may make things infinitely worse if some powerful entity such as the EU or the US decides to financially ostracise an independent, and thus defenceless Bermuda. We then will be truly sorry that the UK has no responsibility to recognise us in the moves it makes to preserve its own impressive offshore financial interests based on the City of London.

Closer to reality, we remain vulnerable especially to the US drawing a bead on our insurance industry (not our banks that would nevertheless suffer as a result), due to segments of that industry, and various of their politicians demanding competitive protection from the enormous tax advantages the industry enjoys here.

Independence from the UK will make not a whit of difference, and indeed might well open the door to a concerted attack by the US, joined by UK insurance interests such Lloyd's of London, and encouraged by a UK government no longer bound to take our welfare to heart.

The way of the world is interdependence; NAFTA and the EU are but a few examples, not lonely and defenceless independence. For smaller jurisdictions this will be crucial. For a diminutive Bermuda, the interdependence we presently enjoy with an effective world power group is essential for the foreseeable future.

We will never get all that we want, but we are at least a part of the team right at the outset, no matter how insignificant we may be. For sure, the price we would have to pay to extricate ourselves from an independent inconsequence among the world's unfortunates, and to form a future association with the EU, or the US, would doubtless be at a price no Bermudian would be prepared to accept.

REALIST

City of Hamilton

Update on Kabul's zoo

January 14, 2001

Dear Sir,

Thanks to just one article in "The Royal Gazette", the Bermuda Zoological Society (BZS) has collected approximately $2,000 from Island residents, wishing to help distressed animals in Afghanistan. I am writing to thank publicly the people who contributed to such a distant cause. I am also writing because I thought "Gazette" readers might appreciate a brief update.

Funds collected here in Bermuda are forwarded to the American Zoo & Aquarium Association (AZA) for disbursement. Dr. David Jones, Director of the North Carolina Zoo, is spearheading the Afghanistan effort on behalf of the AZA.

He is part of global monitoring team, which includes representatives of the National Federation of Zoos based in the United Kingdom, the Cologne Zoo in Germany (which has longstanding ties to the Kabul Zoo), and the World Zoo & Aquarium Association based in Switzerland. The team maintains regular contact with the U.S. State Department, as well as with the British and German governments, and works in close cooperation with the London office of the World Society for the Protection of Animals (WSPA). The North Carolina Zoo regularly posts information for the public on its Web site, www.nczoo.com/kabul.html.

In addition to the monitoring team, several working teams are involved in helping Afghanistan's animals. A WSPA team is there now to evaluate a host of animal welfare issues related to zoo animals, as well as livestock, domestic animals and wild animals. They will link up with local veterinary personnel. Also, a team of veterinarians will go to Kabul in about two weeks to concentrate on the situation at the Kabul Zoo. This team is being assembled through the world zoo community and will be headed by the Cologne Zoo.

In addition, the North Carolina Zoo Society is working closely with the Brooke Hospital for Animals, which already has a presence in Afghanistan, as they prepare to help the displaced donkeys, horses and other domestic animals in the region. Significantly, Dr. Jones's monitoring team report that more than enough money has been raised globally to help the Kabul Zoo for the foreseeable future. The North Carolina Zoo is, therefore, discouraging further contribution to the Kabul Zoo Fund. They have, however, established a second, similar but broader fund.

It is called the Afghan Animals Fund, and it will be used to aid the zoo as required, but can reach beyond zoo walls to help the one million or more wild and domestic animals throughout the country, which have also suffered due to years of war, poverty and neglect. Based on the monitoring team's reports, the BZS has designated the funds collected in Bermuda for the broader Afghan Animals Fund.

Undoubtedly, Afghanistan's people and animals will need international support for years to come. Thanks to compassionate people the world over, including donors here in Bermuda, the animals' outlook is already brighter.

SUSAN MCGRATH SMITH

Bermuda Zoological Society

Bacardi cleas the record

January 10, 2002

Dear Sir,

The World Trade Organization recently ruled in favour of the United States on key aspects of a US law - Section 211 - concerning the ownership of US trademarks associated with businesses confiscated in Cuba. Many press accounts, however, have incorrectly described the result of this case. Some have indicated that the US had lost the case, when it has clearly won on all substantive points.

The United States prevailed in its central argument that the WTO agreement allows countries to establish their own rules governing trademark ownership. The WTO also confirmed that the United States is entitled to enforce its policy against recognising rights on trademarks which were illegally confiscated in Cuba. In addition, the WTO reversed a previous Panel's decision, and found that Section 211 does provide fair and equitable court procedures to enforce trademark rights.

The only thing wrong with Section 211, according to the WTO report, is that it did not go far enough. The report agrees with the treatment that Section 211 provides to trademarks that were confiscated by the Cuban government, but finds that such treatments should be applied regardless of whether those marks are held by Cubans, Americans or Europeans.

Contrary to the claims of some interested parties, the United States is not required to repeal Section 211 or to alter its substance. As confirmed by the US government's own press release in this case, trademark owners such as Bacardi who currently enjoy protection under section 211 can continue to enjoy that protection. The ruling also has no effect whatsoever on the legal status in the United States of the Havana Club trademark.

The Castro regime confiscated illegally the Havana Club assets from the Arechabala family in 1960, and sold them for profit to a joint venture it formed with Pernod-Ricard in 1993. The Arechabala family, unable to fight back on its own, agreed to sell their lawful rights in the Havana Club trademark to Bacardi.

Bacardi and the Arechabala families have known each other since their days in Cuba and Bacardi has known of the Havana Club brand since it was first created in 1934. Over the years, Bacardi had made several attempts to acquire the brand. Those efforts paid off with the sale of Havana Club to Bacardi in 1995.

It is unfortunate that the Havana Club dispute ever became such a high profile issue between the United States and European Union. This should have all ended in August 1997 when a US federal court ruled that the joint venture between Pernod-Ricard and the Castro regime had no rights to the Havana Club brand in the United States. This decision was reaffirmed by a Federal Appellate Court. The US Supreme Court refused to review the case.

Instead they attempted to pressure the US government for political intervention in their favour and complained to the European Union. The EU filed its complaint at the WTO against Section 211. They have tried to blame Section 211 for their repeated courtroom defeats. The fact is that Section 211 did not even become law until 14 months after they already lost their trademark case.

We trust this will help set the record straight regarding the facts about this WTO case and the Havana Club trademark issue.

RUDY RUIZ

President and CEO

Bacardi USA