The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas’ standing as a “must go to” destination faces “damage” from efforts to impose retroactive triple-digit fee hikes on private pilots and general aviation operators who travelled to this nation after May 1, 2021, industry executives are warning.

Rick Gardner, director of CST Flight Services, which provides flight co-ordination and trip support services to the private aviation industry throughout the Caribbean and Latin America, told Tribune Business it was especially “alarming” that the Bahamian authorities had informed him they plan to impose liens/charges, and even seize aircraft, which owe unpaid air navigation services fees.

This threat, he added, comes despite many in the global private aviation industry likely being unaware they have been billed, and/or not received the invoices issued, by the Bahamas Air Navigation Services Authority (BANSA). Mr Gardner, who is also a Bahamas Flying Ambassador, said the Authority has been issuing the invoices via the International Air Transport Association (IATA), which deals with major commercial airlines, not the private aviation sector.

As a result, he explained that only those who already have accounts with IATA will likely have received invoices that his company says impose a fee “increase of 294 percent to 679 percent depending on the maximum take-off weight (MTOW) of the aircraft”.

The invoices, which the private aviation sector has begun to receive over the last several months, are also attracting attention and pushback from industry lobby and advocacy groups. The National Business Aviation Association (NBAA), which represents US corporations that own private planes and interests, said in an article on its website that it plans to seek the Trump administration’s intervention over the Bahamas’ air navigation services charges.

Lenn King, BANSA’s director, did not reply to Tribune Business messages seeking comment before press time. However, Mr Gardner and CST Flight Services, in a posting on their website said BANSA had informed them it is intensifying its outreach to private pilots, plus aircraft owners and operators, and working “with FBOs (fixed base operators) to improve the current collection of charges”.

Michael Strachan, the Bahamas’ ambassador to the International Civil Aviation Organisation (ICAO), told Tribune Business that - while this nation and all other countries have a sovereign right to charge users of their air space for the services they provide - these levies are supposed to be a cost recovery, not a for-profit, mechanism.

He added that himself and others have long argued that the retroactive billing of fees “shouldn’t be done” to avoid industry “pushback” and non-compliance, and renewed calls for greater “clarity and transparency” over how the charges are calculated and handled.

“Ultimately, in accordance with the ICAO annexes pertaining to cost recovery for services provided, the state via its appointed service providers and regulators review and submit the charges for notification to the global aviation community. These charges are not-a-for-profit mechanism to recover costs associated with operations, infrastructure and other expenses related to providing these services,” Mr Strachan told this newspaper.

“Ultimately, if there is a claim of overcharging, that can be resolved through an audit process which could identify any overages and also any undercharging if it has taken place, and there are recourses to rectify those.

“I know the retroactive fees also have been an issue but that’s something myself and others have been vocal about in that it shouldn’t be done, and that the benefits of the charges should match, and that will go a long way globally in the industry where there is less pushback and more support and compliance. There has to be more clarity and transparency on the way the charges are being billed and handled.”

BANSA first sought to impose the same retroactive fee hikes on commercial aviation - both Bahamian and foreign airlines - last year, but seemingly backed-off following pushback and protest. Sherrexcia ‘Rexy’ Rolle, Western Air’s president, chief executive and general counsel, told Tribune Business at the time that the Authority was demanding the carrier now pay an extra $2.4m over and above what it has already paid in air navigation services fees.

Now, the same process appears to have caught up with - and been extended to - private aviation. Mr Gardner told Tribune Business that the industry had begun to receive the BANSA air navigation services invoices “over the last several months”, but many aircraft owners, operators and pilots were likely still unaware because they are being issued through IATA which does not deal with general aviation.

“The only way you would know if you had an invoice is you would have to go to IATA and create an account in their system, then search to see if you have an invoice,” he explained. “But private aircraft have no reason to go to IATA and create an account because IATA is for airline transportation.

“That part is a little bit perplexing. You are using an entity that works only with commercial airlines to handle invoices for private flights. That It’s like making private car owners go to the jitney section at the Road Traffic Department. People will not know they have invoices.”

Mr Gardner said that “what makes it alarming” is that BANSA informed himself and his company that it plans to place liens/charges, and even seize, aircraft upon which unpaid air navigation services fees are owed - even if the owner/operator is unaware they have an invoice or outstanding bill. He added that BANSA had confirmed to him it plans to impose both measures, although many in the industry question whether it has the resources and technical expertise to do so.

The NBAA, in a posting on its website, said BANSA had told CST: “Any aircraft with a debt can be seized/detained by the Government in the case the operator refuses to pay its outstanding debt. This also applies to new owners.”

Mr Gardner told Tribune Business that the impact, and potential fall-out, from the BANSA fees and the way they are being imposed and applied threatens to further undermine The Bahamas’ attraction for a private aviation industry that is one of tourism’s most lucrative markets given that it typically features wealthy, higher-spending visitors. It is also a key distributor of tourism spending through its ability to access Family Island destinations less visited by commercial airlines.

“It’s perplexing that you want to to that,” Mr Gardner asserted. “The fact that The Bahamas is an archipelago of 700 islands, having a market that brings them in on planes is very attractive. They can spread the spending around the islands very easily.

“The Bahamas government has recognised the value of this market, and has invested greatly in time, money and resources to attend, have a booth and presence at general aviation events to attract this market and, up until recently, has generated a very positive image in the general aviation community that it is absolutely one of the destinations you want to go to and one of the easiest.”

However, The Bahamas has buffeted the general aviation industry with a series of fee and cost hikes since the first Davis administration took office in September 2021, including the raised Customs processing fees that were imposed in the 2024-2025 Budget. “If you set the bar low, more people are willing to try it and jump over,” Mr Gardner told Tribune Business. “The higher you set the bar, which is set by fees and complexity, fewer people are willing to try and jump over.”

Besides BANSA’s air navigation services charges, private aviation also has to pay Customs fees, Airport Authority charges and FBO landing and service fees. “It’s getting more complicated and expensive. The message, the perception in the industry, is unfortunately starting to shift,” Mr Gardner said. “Regrettably, I would say The Bahamas’ reputation will take a hit. The more the complexity and fees are increased, the more damage is going to be done.

“It’s a shame, but it’s the Government’s decision. For those of us who promote The Bahamas, it’s getting harder and harder to explain to pilots why all the fees, why all the complexity. All of these things combine to make many operators ask: ‘What’s going on? This doesn’t make sense. What are you trying to do?’ It creates doubt and casts a shadow on The Bahamas, which is truly unfortunate.

“And it’s not just the monetary value. It’s the principal,” Mr Gardner added. “Will the impact from this be draconian and immediate? I don’t think so, but it will begin to pick away at optional flights with persons who want to go and see what The Bahamas is like, but are now hearing it is so expensive, the Government is doing certain things. It sows confusion, and people do not react positively to that perception.

“That’s where you will see the harm. People are interested in going, but hearing this contradictory information makes people nervous about taking a very expensive visit to The Bahamas. It erodes the perception of a welcoming, safe, economical destination with a contradictory, can’t get a clear message. It distorts it, and I think it’s to the detriment of the country.”

However, while single-engine piston aircraft are exempt from the latest BANSA fees and air navigation services charges, those pilots and owners of twin piston, turboprop and jet planes are not and are being asked to pay. Also exempt are aircraft owned or chartered by the Bahamas government; those involved in search and rescue operations; planes belonging to the armed forces or governments of ICAO member states; and aircraft performing an emergency landing in The Bahamas.

Tribune Business reported last year how BANSA had moved to reform the fledgling air navigation services regime. The fees are split into two types - origin/destination charges, which are levied on planes that take-off and land in The Bahamas, and then overflight fees. The latter are levies paid almost entirely by international carriers that fly through, or transit, Bahamian air space without stopping in this nation.

BANSA is restructuring its air navigation services fee regime in a way that shifts the financial burden of these fees on to take-off/landing fees, and away from overflight fees. Many in the industry viewed the shift as a move to appease US commercial airlines and cargo carriers, and the US Department of Transportation, both of which have complained that the level of fees that The Bahamas is charging is excessive compared to the actual services this country is providing to air space users.

This is because The Bahamas, in 2021, agreed a 10-year deal where the US Federal Aviation Administration (FAA) continue managing Bahamian air space above 6,000 feet. The FAA also agreed to waive the cost of air navigation services it was providing and accept a mere $80,000 fee per annum. As a result, the US and its airline industry is arguing that The Bahamas is providing little while also having few costs to cover.

However, the FAA deal was part of a wider strategy to give The Bahamas time to build up its resources, technical skills and capacity to the point where it could regain and take over management of its sovereign air space from both the US and Cuba. The Bahamas set its fees at the level necessary to generate the required financing, plus produce enough income to enable the Civil Aviation Authority of The Bahamas and other regulators to become self-sufficient and no longer need taxpayer support.

Mr Gardner, though, said that BANSA in restructuring the fees is not reimbursing anyone who parted with the older, higher overflight fees and has now overpaid based on the reduced retroactive billing. Instead, it will apply the over-payment as a credit against future billings. And anyone who previously paid the lower landing/take-off fees is, under the retroactive billings, now being charged a much greater amount for something they already paid.

“BANSA is retroactively charging operators who flew to The Bahamas since May 1, 2021, even if they have already paid for BANSA’s services,” Mr Gardner and CST Services wrote on their website. “If you have never paid for these services, you will be liable for those services at the new rates and not the rates that were in effect at that time.

”The new fees, which are being applied retroactively, are an increase of 294 percent to 679 percent depending on the MTOW of the aircraft. If you did pay something you will receive credit for those amounts paid but you will be held accountable for the balance owed. Similarly, BANSA is giving all operators who overflew The Bahamas during that period a credit for a fee reduction of 37 to 69 percent depending on the MTOW of the aircraft. There are no refunds planned, only account credits towards future overflights.”

Mr Gardner told Tribune Business: “It’s like they threw the stable doors open and everyone is running out in different directions, coming up with their own methodology but there is no direction, no strategy. There’s no strategy more than anything else.” He also challenged why himself and other flying ambassadors, who “champion The Bahamas”, always seem to be the last to know about major changes in aviation-related fees and policies.

Meanwhile, the international fall-out appears to be gaining traction. “NBAA is launching an advocacy effort with other impacted stakeholders and the US government to highlight the negative economic impact such onerous fees will have on FBOs, airports, the travel industry and surrounding businesses,” Laura Everington, NBAA’s director of international operations and regulations, said of the BANSA fees.

““We encourage operators who receive retroactive invoices to share their experiences with NBAA to bolster these advocacy efforts with realistic data.”