CorporateJetInvestor – Alud Davies June 18, 2018
A Bahamian registered (C6-IRM) IAI 1124 Westwind II business jet
The Bahamas debates it’s next fiscal budget it has stated its commitment to ratify the Cape Town Convention and is moving towards enhancing its aircraft register with a view to competing with other offshore registries.
Although the Bahamas does already have its own established register and has a handful of mostly older business jets already registered along with Bahamasair the national carrier and regional operators, a change in government last year could see the register move more towards a commercial model.
To explore the potential opportunities, the government approached local law firm Callenders with a view to presenting a feasibility study.
Llewellyn Boyer-Cartwright, a partner at Callenders, doesn’t want to give too much away about what the registry might offer, but he is keen to stress that it will offer something that the other registries do not. Otherwise, he does not see a point in changing the register.
Boyer-Cartwright had met with the previous government with a view to enhancing the register, but although it had expressed interest, nothing really happened.
But once the conservative Free National Movement regained power in May 2017 elections, the debate popped up again, with the new government already expressing its commitment to reboot the register.
Boyer-Cartwright says he has had several meetings with the Minister and his ministry, as well as with the attorney general’s office, and there is already drafting legislation in place for the enhancement of the register with the creation of the mortgage registry.
The country commitment to ratify the Cape Town Convention is a major step forward says Boyer-Cartwright.
The Cape Town Convention, along with its Protocol on Matters Specific to Aircraft Equipment, aims to make it cheaper to raise finance for large, high-value mobile assets that routinely cross borders. It provides standard resolutions in the event that a debtor defaults on repayments, and the Protocol modifies the Convention to meet the particular requirements of aircraft financing and leasing such as being able to ask for an aircraft to be removed from the national civil aircraft register and to export it.
Although Boyer-Cartwright’s recommendation was to offer services towards private and corporate business jet owners, he has also recommended that the register is used for commercial aircraft that are between leases or need to be registered elsewhere during longer periods of maintenance.
“Commercial and general aviation has been growing in the Bahamas, certainly over the last several years, and really I think that the government, as well as the aviation sector, sees the benefit and the increased revenue potential for the aviation sector.” Says Boyer-Cartwright.
The Minister of Tourism & Aviation has presented to Cabinet a white paper regarding the enhancement of the register. At the time of writing the budgetary debate is before Parliament for the next fiscal year and hopefully, by the beginning of July, we will know whether the funding has been allocated for the registry.
Boyer-Cartwright is hoping that at that stage, some funds will be set aside for the initial stages of setting up the enhanced register and hiring consultants to look at the structure of the registry and how it could work.
“I really believe it could be a great compliment to our ship and yacht register. I feel that we have good infrastructure in place already, it will just be a matter of slotting in a few more pieces of the puzzle” he says.
Although there are a number aircraft registers already set up, the success of the Isle of Man registry shows there is still room for more.
On a positive note, the Prime Minister announced in its 2018/2019 Budget Communication on the 30th May that the ten per cent customs duty on the import of aircraft is to be eliminated. Boyer-Cartwright says “this is another step in the right direction as the jurisdiction would not have been considered a serious contender otherwise.”