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U.S. agrees deal to oversee airspace

Thu, May 6th 2021, 07:44 AM
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THE Bahamas Air Navigation Services Authority and the United States Federal Aviation Administration signed an "historic" Air Navigation Services agreement yesterday which is expected to bring in around $300m in fees over the next ten years.

The occasion signifies The Bahamas’ ability to have management over the country’s airspace and charging fees for airspace users. While giving remarks at the signing, Tourism and Aviation Minister Dionsio D’Aguilar called it an “historic day”.
#“Never before in the history of an independent Bahamas has anyone paid anything to the government of the Bahamas for the use of its airspace. Today, that changes,” he said.
#The Tribune has repeatedly drawn attention to the issue alerting our readers to the fact that millions of dollars of aviation fees have slipped through the country’s fingers.
#Mr D’Aguilar noted the associated air traffic control services fees came into effect on May 1 this year. The fees cover planes arriving and departing the country as well as aircraft flying over.
#He explained: “Based upon the fact that the provision of such air traffic control services attracts a fee in almost all jurisdictions of the world, on 1 May 2021, all airspace users that land and take off from Bahamian airports and fly within Bahamian airspace will now pay a fee of $1 per arriving and departing passenger plus a flat fee of $10 up to $61 for each flight depending on the maximum take off weight (MTOW) of the aircraft. The aircraft that weighs less will pay less and the aircraft that (weighs) more will pay more.
#“Also, prior to 1 May 2021, all aircraft flying over the Bahamas, not landing or taking off in the Bahamas, but simply flying through our sovereign airspace paid the FAA directly $61.75 per 100 nautical miles. After 1 May 2021, the airspace users will pay the government of the Bahamas from $8.50 to $51.60 per 100 nautical miles based upon the maximum take off weight (MTOW) of the aircraft. Once again, the aircraft that weighs less and travels a shorter distance will pay less and the aircraft that weighs more and travels a longer distance will pay more.”
#However, the country does not have infrastructure nor the capacity currently to provide air traffic control services above 6,000ft in the sovereign air space. Thus, under the signed agreement, the FAA will provide that service on the Bahamas’ behalf for the next 10 years, with an automatic 36-month extension if the Bahamas wishes to renew at the 10-year period.
#The FAA will not charge BANSA for the continued provision of air traffic services within the portion of Bahamian airspace for which the FAA currently provides air traffic service.
#“Upon entry into force of this agreement, 1 May 2021, the FAA will end its collection of overflight fees for this airspace,” the minister said. “The FAA will continue to provide air navigation services in the sovereign airspace of the Bahamas free of charge.”
#BANSA will pay the FAA a small fee of $80,000 per annum for the provision of data, the details of what airspace users flew through the sovereign airspace in a particular month. In turn, the data will be used to assist in billing and collection of the fees.
#Mr D’Aguilar noted that typically when people purchase an airline ticket, all of these fees are embedded in the price.
#“There’s an organisation called IATA, the International Air Transport Association, which is like the Chamber of Commerce for all airlines and all of the fees go to IATA and then IATA then takes that money that you’ve paid for your ticket and breaks out between some goes to the airport. Some goes in government taxes. Some will go in these fees and that is how monies are settled in the aviation sector. The fees will be built into your tickets and when you purchase a ticket you will pay for those fees.”
#Mr D’Aguilar said an annual injection of tens of million of dollars is anticipated due to the fees.
#He said: “We’ve obviously had our consultants looking at the traffic flow and based on the fee structure that we would have designed and we’ve put in place, we reckon in the first year it should be between $20-30 million and then obviously right now we’re in a depressed aviation sector. COVID-19 has significantly impacted the aviation sector and we envision overtime this growing to $30-40 million. So, I’d like to say over the next 10 years we’re signing today a $300-350 million deal today.”

The occasion signifies The Bahamas’ ability to have management over the country’s airspace and charging fees for airspace users. While giving remarks at the signing, Tourism and Aviation Minister Dionsio D’Aguilar called it an “historic day”.

“Never before in the history of an independent Bahamas has anyone paid anything to the government of the Bahamas for the use of its airspace. Today, that changes,” he said.

The Tribune has repeatedly drawn attention to the issue alerting our readers to the fact that millions of dollars of aviation fees have slipped through the country’s fingers.

Mr D’Aguilar noted the associated air traffic control services fees came into effect on May 1 this year. The fees cover planes arriving and departing the country as well as aircraft flying over.

He explained: “Based upon the fact that the provision of such air traffic control services attracts a fee in almost all jurisdictions of the world, on 1 May 2021, all airspace users that land and take off from Bahamian airports and fly within Bahamian airspace will now pay a fee of $1 per arriving and departing passenger plus a flat fee of $10 up to $61 for each flight depending on the maximum take off weight (MTOW) of the aircraft. The aircraft that weighs less will pay less and the aircraft that (weighs) more will pay more.

“Also, prior to 1 May 2021, all aircraft flying over the Bahamas, not landing or taking off in the Bahamas, but simply flying through our sovereign airspace paid the FAA directly $61.75 per 100 nautical miles. After 1 May 2021, the airspace users will pay the government of the Bahamas from $8.50 to $51.60 per 100 nautical miles based upon the maximum take off weight (MTOW) of the aircraft. Once again, the aircraft that weighs less and travels a shorter distance will pay less and the aircraft that weighs more and travels a longer distance will pay more.”

However, the country does not have infrastructure nor the capacity currently to provide air traffic control services above 6,000ft in the sovereign air space. Thus, under the signed agreement, the FAA will provide that service on the Bahamas’ behalf for the next 10 years, with an automatic 36-month extension if the Bahamas wishes to renew at the 10-year period.

The FAA will not charge BANSA for the continued provision of air traffic services within the portion of Bahamian airspace for which the FAA currently provides air traffic service.

“Upon entry into force of this agreement, 1 May 2021, the FAA will end its collection of overflight fees for this airspace,” the minister said. “The FAA will continue to provide air navigation services in the sovereign airspace of the Bahamas free of charge.”

BANSA will pay the FAA a small fee of $80,000 per annum for the provision of data, the details of what airspace users flew through the sovereign airspace in a particular month. In turn, the data will be used to assist in billing and collection of the fees.

Mr D’Aguilar noted that typically when people purchase an airline ticket, all of these fees are embedded in the price.

“There’s an organisation called IATA, the International Air Transport Association, which is like the Chamber of Commerce for all airlines and all of the fees go to IATA and then IATA then takes that money that you’ve paid for your ticket and breaks out between some goes to the airport. Some goes in government taxes. Some will go in these fees and that is how monies are settled in the aviation sector. The fees will be built into your tickets and when you purchase a ticket you will pay for those fees.”

Mr D’Aguilar said an annual injection of tens of million of dollars is anticipated due to the fees.

He said: “We’ve obviously had our consultants looking at the traffic flow and based on the fee structure that we would have designed and we’ve put in place, we reckon in the first year it should be between $20-30 million and then obviously right now we’re in a depressed aviation sector. COVID-19 has significantly impacted the aviation sector and we envision overtime this growing to $30-40 million. So, I’d like to say over the next 10 years we’re signing today a $300-350 million deal today.”

 

Click here to read more at The Tribune

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