fp Turks and Caicos

The Turks and Caicos Islands Airports Authority is trying to set the record straight on its joint venture with an international company that will offer ground handling services at the Providenciales International Airport.

One vocal critic, Shaun Malcolm, has circulated a letter making numerous accusations against the TCIAA and others, claiming that the authority is forbidden by law from forming a joint venture with Servisair to compete with local ground handlers.

Malcolm, who is involved with the new local airline Skycruise Airways, is seeking to offer ground handling services at the airport.

The authority issued a statement Feb. 27 dismissing Malcolm’s claims, pointing out that the joint venture is legal and was properly consummated with board approval.

As the fp reported Feb. 16, a member of the Attorney General’s Chambers reviewed the venture, and the authority’s public board minutes show that the matter was approved.

Albray Butterfield Jr., whose local TCA Handling Company provides ground service to American Airlines on Provo, agrees with the authority that it was completely within its legal rights to form the joint venture, but he complains that Servisair will have an unfair advantage.

In a March 1 statement, Butterfield claims that Servisair won’t have to pay the same taxes and fees as TCA and other handlers, and will be able to claim that it can grant concessions because of its partnership with the authority.

Airports Authority CEO John T. Smith says claims of special treatment for Servisair — which has not yet begun operations — are “absolutely” false. He says Servisair will compete under the same conditions as TCA and Flight Support.

Lyndon Gardiner, chairman of Flight Support Limited — the ground handler for most airlines other than American — has also objected to the joint venture as unfair competition.

Both Butterfield and Gardiner say they aren’t afraid of fair competition, but Smith says that is what the authority is trying to accomplish.

Since 2009, some airlines have threatened to halt service to Providenciales because of “the non-competitive nature of the ground handling services and the level of services,” Smith said. So the authority decided to be the local partner for Servisair, which operates in 121 locations including Europe and Asia, markets from which the TCI hopes to draw new direct flights.

Servisair holds 70 percent of shares in the venture, and the authority holds 30 percent. Smith says the authority has no say in the operation of Servisair, which will compete on a level playing field with TCA, Flight Support and any other handler.

The authority will get 30 percent of Servisair revenues, which will go to government.

The attorney general and government chief executive officer blocked a review of Malcolm’s allegations by the Consultative Forum, saying it has no power to conduct such inquiries.

Both Butterfield and Malcolm called for the governor and the Advisory Council to stop the joint venture.

According to a March 7 open letter to His Excellency the Gov. Ric Todd, Butterfield says the governor told him to take his objections to the TCIAA. “If in your view this in not possible or appropriate then you may wish to seek legal advice about what other courses of action are open to you,” Butterfield says the governor responded.

Butterfield says with that response the governor has “chosen to circumvent your oversight authority by your omission to exercise those oversight powers.”

The TCIAA was created by elected government in 2005. Butterfield says the legislation “empowers the Board of Directors of the TCIAA with unlimited wide reaching powers to do whatever they choose to do without first seeking approval from the government that holds the oversight authority over the TCIAA.”

While oversight is limited, the legislation says the government minister with control of the airports — currently the governor — “may, after consultation with the Authority, give such general and lawful directions in written form as to the policy to be followed by the Authority in the performance of its functions, and the Authority shall give effect to such directions.”

Click HERE to read the TCIAA statement

Click HERE to read Butterfield's statement