Charter fee row explodes again with Trump appeal

The international row over sharp rises in charter fees here has reignited, with the United States Virgin Islands calling on US President Donald Trump to use the “full weight” of American power to pressure London and Road Town over the issue.

A public spat between the leaders of this territory and the USVI initially exploded last March after Premier Natalio “Sowande” Wheatley announced steep increases in fees.

USVI Governor Albert Bryan Jr. responded by calling on Mr. Trump to slap tariffs and travel restrictions on the VI in retaliation. But a compromise was then hammered out between the two territories, and smaller increases were introduced instead.

Letter to Trump

The USVI charter industry was not appeased, however, and on Dec. 4 Mr. Bryan wrote to Mr. Trump requesting that the US federal government take a tougher line with the VI and the United Kingdom.

Mr. Bryan stated in the letter that since the new fee scheme was implemented in June, some 90 USVI charter vessels have moved their home part to this territory at an immediate cost of $14 million to the American territory’s economy.

In the letter, he claimed the VI fee increase amounted to the imposition of tariffs against America and called for “swift and coordinated federal action” to address the matter.

“Let me be clear: We respect the BVI’s authority to regulate its waters,” Mr. Bryan wrote. “But this is not cost recovery, this is economic exclusion. And the result is US-based companies being pushed out of a US territory and into a foreign jurisdiction.”

He also accused the VI of “hollowing out” the USVI economy with a move he claimed could result in the loss of 600 jobs and $100 million annually.

Mr. Bryan urged the president to raise the matter at the highest levels with the UK and called for the “full weight” of federal government action to be deployed.

He also called for the US to launch a review into the matter to determine whether the VI is breaching obligations under the US Caribbean Basin Economic Recovery Act.

“As a beneficiary of US trade preferences, the BVI must meet baseline standards of equitable access,” he wrote. “A formal review is warranted to determine if the current regime is compatible with continued CBERA eligibility.”

The Office of the United States Trade Representative has since probed the CBERA matter and issued a report to the US Congress, according to a Sunday press release from USVI advocacy organisation Project Fair Waters.

The organisation — a group of marine, tourism and small-business stakeholders formed last year in response to the USVI-VI spat — seized on the report as evidence that the situation is damaging the US territory.

Project Fair Waters claimed the report supports its stance for lower VI fees.

“For the first time, the president’s own trade office has put in black and white what USVI families have been living for months: The BVI’s 4,000 percent fee hike is not a routine policy choice — it is an unfair trade barrier that puts roughly 5,000 jobs and $166 million of US economic activity at risk,” Kosei Ohno, who leads Project Fair Waters, said in the press release.

VI airport plans

Mr. Ohno added that the US could retaliate by making financing for the planned $400 million-plus runway extension on Beef Island more difficult to obtain.

“The message to BVI is subtle but unmistakable,” Mr. Ohno said. “You cannot ask global lenders to backstop a multi-hundred-million-dollar airport while the White House trade office is telling Congress you are imposing 4,000 percent fee hikes on US operators and seizing US Virgin Islanders’ property.”

‘Greater VI Sailing Zone’ proposed

He called for the VI to change course and embrace the idea of a “Greater Virgin Islands Sailing Zone” that “harmonises charter operations” between the two territories.

“Regulatory alignment and less red tape would reduce disputes, enhance investment certainty, [and] foster shared economic growth while preserving regional stability and maintaining immigration and tax controls,” he said.

The rules

Under the revised fees agreed last year, USVI charter boats are charged $7,500 annually for up to seven entries to VI waters, with an additional fee of $2,100 for each extra visit — or $24,000 a year for unlimited access, according to government.

Under the originally proposed legislation, charter fees would have risen by up to 6,000 percent with the annual licensing fee being a flat $24,000 — a 2,900 percent increase from the $800 maximum annual fee previously in place.

The revisions also lowered the new annual fee for USVI boats offering day charters: The originally proposed $12,500 — a 6,150 percent hike on the previous $200 fee — was lowered to $8,500, the premier said at the time.

The new fee for water taxis stayed the same, at $2,500 per year.

Mr. Wheatley did not immediately respond to requests for comment.