The Tribune

• Island Game chief registered JDL website

• New fees ‘big pill to swallow’ for Bahamians

• Opposition demands PPP deal is ‘cancelled’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The company charged with the $25m transformation of the Government’s air freight terminal has links to a web shop principal, Tribune Business can reveal.

Registration documents for JDL’s website, which have been seen by this newspaper, name the registrant as Pete Deveaux, The Island Game chief, while also listing his personal cell phone number as the “admin” and “tech” contact. The number given is a contact that Tribune Business and its sources both hold for him, while the website registration was created in March 2023 and updated in November.

Mr Deveaux did not comment when contacted by this newspaper, instead sending a messaged reply that read: “Can you direct all comments [sic, inquiries] to the Ministry of Finance please.” However, he did not deny his involvement or links to JDL, and the reply was sent from the same cell phone number as that listed on the company’s website registration.

JDL’s ties to The Island Game’s principal emerged as international air freight providers yesterday voiced concern about the likely increase in the cost of imported goods, and the extra complexity, that appears to be involved with the public-private partnership (PPP) outsourcing of the Lynden Pindling International Airport (LPIA) air freight terminal.

Thomas Cooper, president/owner of Miami Lakes-based Conquest Air Cargo, which provides “quite a bit of air freight” to The Bahamas via LPIA, told Tribune Business the extra cost imposed by the potential ‘40 cents per pound’ fee JDL plans to charge for cargo x-rays will “be a big pill to swallow” for all Bahamian consumers.

Simon Wilson, the Ministry of Finance’s financial secretary, told this newspaper on Thursday that JDL’s fees have yet to be finalised and the Government is “hoping it will be less than 40 cents”. He argued that whatever fee is selected will have “a very minimal” impact on import costs, and said claims to the contrary by the courier industry and Opposition were “disingenous”.

Mr Cooper, though, said he and other air freight operators had been taken by surprise by Tribune Business’s revelations of the JDL deal. “It kind of came out of the blue,” he revealed. “I know some of the customers, our customers, are very worried about it which makes me worried about it.”

Those customers are Bahamian courier firms, but Mr Cooper agreed that the air freight terminal - which Mr Wilson had described as “a disgrace” due to a “compromised” roof and near-intolerable working conditions for both Customs officers and the private sector - is in desperate and urgent need of transformation.

“I do agree that the facility needs upgrading,” he said. “It all boils down to the amount. Forty cents per pound is just a big pill to swallow for our customers and also the Bahamian public who will ultimately end up paying for it.

“As you pointed out, it’s hard to pass increases on to the customer that quickly. It is kind of tough. I know some customers [couriers] operate on a seven-day, or 14-day, or even 30-day payment. Some of them just don’t have the ability to have the money up front.”

Some Bahamian courier companies fear they will either have to close or lay-off staff as a result of the 40 cents per pound fee being imposed to scan imported air cargo for contraband before it is released to the relevant broker or client.

They are worried that it will impose extra strain on their businesses and operating model because they must pay JDL’s handling fee upfront in order to have the cargo released. The industry will thus be faced with having to later reclaim this outlay from its clients, some of whom will likely fail to pay, thus leaving couriers exposed financially.

Meanwhile, Mr Cooper said the cargo scanning and clearance system being proposed by JDL appears unlike those used by other countries. “It seems like it’s a duplicative process,” he added. “I can’t think of any other places in the world that do it that way.”

A JDL presentation, obtained by this newspaper, details how the process will work once the air freight terminal’s $25m redevelopment is completed - with construction expected to take 12-18 months once it begins. Freight forwarders will “barcode and scan” packages for upload into JDL’s system, containing details on the weight and owner.

Once cargo arrives in The Bahamas, it will be transported by ground handlers such as Nassau Flight Services (NFS) to JDL at the new air freight terminal, where it will be broken down and x-rayed (scanned) for contraband such as firearms and narcotics. Any illegal discoveries will be handed to Customs.

Once cleared, couriers/brokers will be notified that their imported shipments are in a holding area. JDL will release them once paid its handling fee, and the goods will then undergo a second inspection by Bahamas Customs. That second “verification” is likely what Mr Cooper meant when he voiced concerns over duplication.

The US air freight provider also said the JDL proposal raises multiple questions as-yet unanswered. “I am also curious as to how air freight into Grand Bahama and the Out Islands will be handled. Will they be charged the same surcharge as freight arriving in LPIA?” Mr Cooper asked.

“Another point is how JDL or Customs will handle the freight that enters in the belly of large passenger airlines such as Jet Blue, Bahamasair, American and Delta? Will their air freight be subject to this additional screening and fee?”

Michael Pintard, the Opposition’s leader, in a statement issued yesterday demanded that the Government “cancel” the JDL deal and called on it to “come clean” with the Bahamian people on its implications. Accusing the Government of imposing another stealth tax on Bahamians, he questioned why the contract appeared to have been awarded without any competitive bidding process.

Mr Wilson told Tribune Business on Thursday that the Government has been seeking a solution to the air freight terminal’s deterioration for ten years and, despite approaching multiple parties, was unable to find a PPP partner until JDL appeared. However, Mr Pintard questioned whether the deal complies with both the original, and new, Public Procurement Act.

And he also challenged whether the JDL deal breaches the Customs Management Act, which makes Customs the sole lawful authority dealing with the landing and clearance of goods in The Bahamas. The Opposition leader argued that the Government must come to Parliament and get its approval, via passage of a new law, before JDL can levy the facility fee and ‘40 cent per pound’ charge.

Asserting that the Opposition “outrightly condemns” the JDL proposal, Mr Pintard charged: “Clearly, what is reported cannot be justified or rationalised in any manner. It simply cannot be that the Government has signed on to a $25m-plus arrangement outside of its own procurement law that would require an undertaking like this to go to competitive bidding.

“It cannot be that the Customs Management Act is being breached by allowing an entity to manage landed goods outside of the prescribed legal framework. It cannot be that there is a January timeline to implement this arrangement when the Government has given the public no notice and has not said anything about the initiative, the vendor or its ownership. Who will be taking home millions of dollars with this no-bid contract?”

Pointing out that “only Parliament has the authority to impose new mandatory taxes and fees”, Mr Pintard challenged with the JDL deal has not been brought to Parliament for its scrutiny and approval. “All Bahamians who use air couriers to bring in items will face increased prices even though they are already paying Customs processing fees to manage all related public facilities,” he added.

“We in the Opposition categorically reject this arrangement and we demand that same be cancelled without delay. Bahamians already pay Customs processing fees and thus any necessary upgrades to the air freight facilities should be funded from these fees.”

Other sources, speaking on condition of anonymity, also argued that the JDL as presently structured would effectively usurp the role of Customs as the sole authority lawfully responsible for managing and handling all imported cargo landed in The Bahamas. As a result, they argued that the PPP arrangement violates the Customs Management Act.

Besides cargo manifests being sent directly to JDL, instead of Customs as required by the Act’s section 72, the actual physical goods will also be received by the private company. Presently, all cargo is received by a broker/agent licensed by Customs, and held in a storage/bonded facility subject to the agency’s control and from which it earns rental fees.

However, JDL is now taking on this role, where it will become the landlord and - in theory - receive the rent instead of Customs. Queries have also been raised over JDL’s plans to break down shipments for scanning, given that the Act requires owners and/or their agents to be present when goods are examined, while its staff are not police or law enforcement agents and thus lack the authority to seize contraband.

One source said the minister of finance can designate the JDL facility as a separate port of entry, but this has to be gazzetted, remain under Customs’ control and there is a process for doing so. “What has to be debated and go to Parliament is making the fee compulsory,” they added. “To engage a private entity to charge a fee, that has to be an Act of Parliament.

“This is a charge that is mandatory to cover the cost of the facility. You’d have to create an Authority or engage an entity through Parliament to facilitate this mandatory compulsory charge. Only Parliament has the power to force you to pay for something. Otherwise, who has the legal authority to charge you this fee? I think that may be problematic.

“How does this fit with the Customs Management Act? If this is to come into effect in January, why isn’t the public informed? You’d expect a public education campaign. There’s a fee coming on board, and people need to prepare and adjust accordingly. You cannot drop this on the consumer.”