Parliamentary democracy was introduced to The Bahamas in 1729 and has been sustained uninterrupted for 268 years, making it one of the most stable countries in the world. The Bahamas has been a fully independent nation since 1973 and holds membership in the Commonwealth, the United Nations and Organization of American States. This longstanding democratic heritage and maturity as an independent state makes The Bahamas one of the safest and most stable international locations for investments.

The Bahamian political system is based on the British parliamentary system. The Parliament consists of the House of Assembly and the Senate. Members of the House of Assembly, numbering 40, are directly elected every five years, while the 16 members of the Senate are appointed by the Governor General. Nine (9) senators are appointed on the advice of the Prime Minister, four (4) on the advice of the Leader of the Opposition and three (3) on the advice of the Prime Minister after consultation with the Leader of the Opposition. Elections are competitive, with wide public participation, and always peaceful.

The Executive Branch is comprised of a Cabinet headed by the Prime Minister and includes a minimum of eight (8) other Ministers, one of whom must be the Attorney General. The governing Free National Movement was first elected to office in 1992, following 25 years of government by the Progressive Liberal Party. Prime Minister for a second term, the Right Honourable Hubert A. Ingraham led the Free National Movement to a resounding re-election in 1997 with an increased percentage of votes and an increased number of seats. The Bahamian judiciary is a well established and fully independent branch of government. English Common Law is the basis of the judicial system, although there is a large body of Bahamian statutory law.

The Supreme Court is a court of unlimited jurisdiction in civil and criminal matters. An appeal from the Supreme Court lies to The Bahamas Court of Appeal consisting of three (3) distinguished jurists who have previously held high judicial office.

The highest Court, the Privy Council, sits in London. Appeals from the Bahamas Court of Appeal lie with the Privy Council.