BAHAMAS-Government and port authority differ over tribunal ruling.

NASSAU, Bahamas, CMC – The Bahamas government has described it as a “monumental win” even as it suffered a comprehensive legal defeat after its multi-million-dollar claim against the Grand Bahama Port Authority (GBPA) was dismissed in its entirety.

The Government has released the full 139-page award on the Office of the Prime Minister’s website, along with a guide to help the public navigate the decision.

Attorney General Ryan Pinder said the GBPA had mischaracterised the arbitration ruling between the two parties, saying that the GBPA failed in its bid to seek “over a $1 billion” in damages against the Government.

Pinder also described the ruling as historic, saying it has brought clarity to long-standing disputes over the governance of the Port Area, and that the Arbitration Tribunal rejected seven of the GBPA’s eight counterclaims, including its substantial damages claim alleging wrongful interference in the administration of Freeport.

“The partial award affirms the administration of the Port Area is not exclusively vested in the GBPA. At most, the GBPA retains specific contractual and administrative responsibilities. But these operate alongside and are subject to the Government’s continuing power,” he said, adding the ruling confirms that licensing, immigration, customs, and other regulatory matters remain subject to government authority.

“Clarity in law has been given that the government has regulatory and legislative authority over matters in the Port Area,” he said.

In its ruling dismissing the US$357 million claim against the GBPA, the three-member arbitration panel also found that the Government was in breach of the Hawksbill Creek Agreement by failing “to take the necessary steps” to implement environmental bye-laws for the city that were first proposed by the GBPA nearly 20 years ago.

The arbitrators, Anthony Smellie, ex-chief justice of the Cayman Islands, Lord Neuberger, and Dame Elizabeth Gloster, found that the GBPA had succeeded on this aspect of its counterclaim and invited both the Government and Freeport’s quasi-governmental authority to make submissions on the amount of damages to be paid.

In a statement, the GBPA described the outcome as a landmark ruling for Freeport and Grand Bahama, saying, “This is more than a legal victory. It is a stabilising moment for Freeport.

“We trust the ruling will give licensees, investors, stakeholders, and Grand Bahama residents renewed assurance and optimism for the future. We have advised the Government repeatedly since June 2016 that this claim was wrong and would fail. It was not a good use of time or public resources.

“We have always maintained that benefit for Grand Bahama would best be obtained by GBPA and government working together,” the GBPA said in its statement.

The Tribunal has instructed both sides to identify outstanding issues, including damages and costs, and to agree on a procedure and timetable for determining those matters, with a report back due in early March.

Pinder said the partial award resolves two major issues.

“One, it established that there is liability of the Grand Bahama Port Authority to reimburse the Government of The Bahamas and the taxpayers of The Bahamas for administrative expenses incurred in Freeport by the Government. It ruled that liability absolutely exists.

“The second thing this arbitration award did was clearly define the roles of the government and the Port Authority with respect to the governance of Freeport.”

Regarding the Government’s claim, Pinder said the Tribunal confirmed that the 1994 review mechanism remains enforceable, allowing annual payments to be reviewed and determined.

“In practical terms, the annual review process can commence immediately in respect of future years,” he said, noting that from 2023, when the Government first invoiced the Port Authority, the review process can now proceed.

The quantum of payments has not yet been determined, and Pinder said if the parties cannot agree on how to calculate the sums owed, the Tribunal will decide the matter.