The Tribune

Bahamians were yesterday warned that the cost of imported air freight will increase “tremendously” as a result of the new Customs fees and fines set to be imposed on operators from today.

The warning came as Florida-based air cargo companies confirmed Tribune Business’s exclusive Thursday article that a withdrawal from the Bahamas market remains an option should the amendments to Customs regulation 147 not be reversed.

Walter LeBlanc, chief pilot for Fort Lauderdale-based Island Wings, said he and his colleagues were mulling whether to end services to the Bahamas, telling this newspaper: “It’s up in the air right now.”

   He explained: “It will have a major impact. Basically, they are making us responsible for doing their jobs. Customs officers are supposed to inspect incoming cargo passengers and  their baggage. What they are doing is now they are putting that job on us, and if it is not done they are fining us heavily, which I don’t think is not fair deal.”

And Mr LeBlanc then warned: “This is going to cause the price of freight to go up tremendously, which is a bad thing for the Bahamian people. They hit us two years ago with the $150 on each flight.

“How is that fair, when we have an airplane that carries seven people, and Jetblue has an airplane that carries 250 people? We both have to pay $150. They can spread that out on 250 passengers, and we have to spread it out on seven passengers.

“It’s just getting to the point where you are going to have to look at your operation and question whether it’s worth it to go to the Bahamas. If they are going to make us liable to do their jobs and penalise us with large fees when something goes wrong, it’s just not going to be feasible.”

As reported by Tribune Business yesterday, correspondence is circulating that warns air cargo/freight companies to “be prepared to withhold your services” if it becomes necessary to force the Government to repeal changes that accompany the 2016-2017 Budget.

The letter, addressed to “all carriers to the Bahamas”, and copied to the many local couriers and import brokers they serve, warns that the potential liabilities from the new Customs penalties “are more than any reward our airlines can make”.

The shipping/cargo/logistics industry has been thrown into turmoil by the Budget amendments.

In common with the ocean shipping industry, the cargo airlines are especially concerned about the changes to regulation 147 in the Customs Management (Amendment) Regulations.

This requires all cargo planes to submit their C7 general declaration forms to Customs, detailing all freight items they are bringing in, one hour before touching down in the Bahamas.

While this will incur a $75 processing fee, any C7s submitted less than an hour before arriving in the Bahamas will be subjected to a $2,500 charge.

Air cargo operators will be subjected to a $5,000 per item fine for every “prohibited or restricted good” found on board. A fine equivalent to 25 per cent of the value will also be incurred for every item not declared prior to landing in Nassau.

   “We have to look at our operations and say maybe we can just operate within the state of Florida and look at different markets which we don’t do right now,” Mr LeBlanc said.

“It may get to the point where we say we should  just skip the Bahamas. It’s up in the air right now. I’m working with several other carriers, and we are trying to decide what to do. Why is it our job to inspect the cargo before it leaves?

“We are taking a ‘wait and see’ approach. We will look  at what happens and what everyone else is going to do.”

Edison Sumner, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) chief executive, yesterday said the private sector was concerned about the threat of an air cargo ‘boycott’ given the economy’s import dependence.

“That’s a matter we are looking at,” he confirmed of the Customs fees and fines. We are discussing it, and we are looking at it intensely. We are looking to engage further those in the industry, as well as the Government, to determine the way forward. It is a matter that is receiving the Chamber’s attention now.

“Whenever there is a threat of this magnitude, based on the feedback from industry, we are concerned. Whenever there is a threat, real or perceived, that threatens the flow of business, we are concerned. Every business relies to some degree on air couriers bring in product and exporting product as well.”

Mr Sumner pledged that the Chamber would take “a balanced approach” to resolving the issue, so that it did not appear to be “pandering” to one side or the other.

“It’s important for us to understand the Government’s intention in putting the rules and regulations in place, and also for us to understand the impact for industry and business,” he added.

Mr Sumner expressed hope that despite the implementation of Customs’ new sanctions regime from today onwards, “there is still an opportunity for us, if necessary, to have amendments made”.

“That’s where discussions rest with the various parties,” he said.

Charles Turner, the Customs Comptroller, was said to be out of office yesterday and unavailable for comment. A message left on his cell phone was not returned. A message also left for William Poitier, the deputy comptroller, was not returned either.