Local operators concerned over tendering process for CJIA duty-free shops

The TWEE duty free shop (CJIA photo)
The TWEE duty free shop (CJIA photo)

Several local operators at the Cheddi Jagan International Airport (CJIA) met on Monday with Minister of Public Infrastructure David Patterson and expressed their concern about the tendering process for duty-free shops at the airport.

Complaints were also voiced to Sunday Stabroek over the award by the CJIA of duty-free shops in the arrivals lounge to three foreign-owned companies.

“We understand that ANSA McAL, TWEE [both of Trinidad and Tobago]  and Kings Enterprises, of Suriname, have been awarded duty shops in the arrivals [lounge] by the CJIA. Although Banks and DDL had tendered, these local companies seem to have been sidelined,” a source told this newspaper.

“What are you saying to your country when you choose foreign companies with foreign products to operate at your airport over your locals? Do you think that Banks or DDL could have a space in Trinidad and Tobago over T&T companies? Are you crazy?” the source questioned.

This newspaper reached out to Chairman of the CJIA Board, attorney Stephen Fraser, but was told by his secretary that he would not speak and that this newspaper should contact Chief Executive Officer (CEO) of the CJIA. Sunday Stabroek tried contacting CJIA CEO Ramesh Ghir over the past two weeks via phone and email but he has not responded.

Minister Patterson was contacted on Tuesday but he explained that he was in a meeting at the time.

Banks DIH Manager Ramesh Dookhoo would only say that his company had a representative at the meeting with Patterson but would not go into details about what was discussed at the meeting.

DDL’s Chief Executive Officer Komal Samaroo said while he was not the point person responsible for overseeing the tendering process at his company, he knows that it had tendered for a duty-free shop and his people “are currently looking into the matter.”

As a result of the meeting on Monday, the Airport Operators’ Association (AOA) was formed.

Awaiting clearance

Representatives of ANSA and Kings explained that their concessions came through a fair process and while they were awarded the tenders by the CJIA, they still have to receive clearance from the Guyana Revenue Authority to complete those agreements.

“We went to tender and won the award. We are still to get the licensing and so on from the customs end but this is a tender we won and I can show you the documents,” ANSA McAL Country Manager Beverly Harper told Stabroek News when contacted.

Harper explained that her company had bid previously to provide the same service in the arrivals lounge but that tender process was scrapped last year. She said the company was invited again to bid and was notified by CJIA that it had met all of the requirements but would be granted full approval pending the GRA’s customs clearance.

Manager of Kings Enterprises in Guyana Amerit Nejal lamented that while his company has also been given approval to operate by CJIA, it has been waiting on the GRA for many months to finalise the operations. 

“From the airport end, we have everything but from GRA’s end now, we have some issues… GRA has to give the licence to operate the duty-free. We have to wait on that,” he said.

Nejal pointed out that “up to last month” his company checked but got no word from GRA on if or when the licence would be granted.

“We already have a duty-free at Moleson Creek and we have this establishment. They are linking all the companies together. So, if one company has a little issue with them, they are linking all the companies together. It makes no sense to me because it is three separate entities but all under the same head office,” he said.

“We reached at a stage where it is just a back and forth with them. I don’t know if the government don’t want the business to continue, if they don’t want foreign businesses to establish their brands or what it is,” he added.

Nejal believes that the company is being “pushed off by the GRA,” which he was told wants to put a stamp on the drinks to indicate that it is duty-free. The implementation of the stamping process, Nejal said, “makes no sense.” “Because they want to implement something, they want to put us on hold,” he added.

He said his company had to secure a bond with a local bank and that money continues to rest in the bank and it continues to pay for a space that it is not using, which he believes is totally unfair to the company. 

“ANSA McCAL and us applied and we split the same unit at the departures but we have not been able to use the part for us… our space is there for us all the time. We have been paying the lease on it as well. Just to keep it. Eventually, they will tell us that they will give somebody to operate it because it is a closed area now,” he noted.

Avoiding abuse

Commissioner-General of the GRA Godffrey Statia told Stabroek News that his agency is currently reviewing applications for both the arrivals and departures section.

Statia informed that the GRA is also putting measures in place for the implementation of duty-free stamps “to avoid the abuse.”

Statia made clear that “nobody has been approved” since it is the customs and tax agency that that would have to give the clearance to the operating of duty-free businesses here.

Meanwhile, next Tuesday is the deadline for the submissions of Expressions of Interest (EoIs) to the CJIA for concessions for the duty-free shops in the departures area. EoIs have also been invited for the airport’s executive lounge.

“The Corporation’s decision with regard to selecting a Concessionaire through this EoI shall be final and the Corporation reserves the right to reject any or all proposals which do not meet the pre-qualification criteria. The Concessionaire must get approval from the Guyana Revenue Authority to operate a Duty Free Shop before the concession is awarded by the Airport Corporation,” an advertisement, which went public on the airport’s website on April 2nd last, states.

‘Same space’

The invitation for EoIs has not been met well by current operators at CJIA as some have questioned how the same spaces for which they have an ongoing agreement with the airport authority are being advertised.

“I cannot understand how you have an agreement with the airport and then comes this public tender for the same space. They demolished some of the shops of some operators, they had to move and be inconvenienced and now when you are done you advertise that same space to the highest bidder? Whatever happened to the right of renewal?” one operator, who asked not to be named, said when contacted.

But it is not only the duty-free shop owners that are irked by the CJIA’s decisions as cargo and other operators have also voiced their disquiet.

“I have also suffered at the hands of the CJIA. I am repaying a G$180 million loan because the CJIA is attempting to withdraw from written authorisation for me to operate as a ground handler. Banks DIH and DDL may also be victims of CJIA decisions. It is no surprise to me that Cabinet had no idea about this “quarter-baked” idea to implement these fees. I was told that the subject Minister wasn’t even pre-alerted to the [Caribbean Airlines] threat. CJIA has gone rogue and the subject Minister, for whom I have much respect, must now fix the situation before more harm is done,” operator Terrence Campbell stated.

Campbell said that in 2013, he wrote the airport authority indicating that he wanted to extend his services from cargo handling to full ground handling.

He said his building was south of the arrivals section and there was no place to park the equipment that would have to be imported.

Campbell said that there was an informal discussion with CJIA executives about compensation for the demolition of his and other buildings to facilitate the airport expansion project’s works.

“Sometime in 2015, I got a call from Stephen Fraser about demolishing…. He said, ‘Do you intend to cooperate or not?’ I said the conversation was over. I wrote several members of the Cabinet and an arrangement was made to place us in the old GAC hanger. It was split between New Timehri Handling Service, Consolidated Cargo and CAL engineers,” Campbell said.

Campbell said that the airport did renovations to the old hangar to accommodate the companies and in 2016 they moved.  He added that he then moved to apply for financing for ground handling equipment and he started processing the $180 million loan to begin such services. Discussions were had with a senior executive on where the material would be parked and he felt all was well.

“The loan was approved in December 2017. I proceeded to I purchased half the equipment and it was imported in 2018. When it came in, it was only to see the airport advertising for a ground handler. Campbell said that he is now left with repaying a loan without any correspondence from the CJIA management on when or if he can begin services.