The government of Turks and Caicos has agreed to write off more than USD1.6 million owed to the local airport's authority by interCaribbean Airways (JY, Providenciales) and Caicos Express Airways (9Q, Providenciales), to pre-empt protracted legal battles to retrieve the funds, the outcome of which would be uncertain, writes the islands' The Sun newspaper.

Specifically, interCaribbean Airways will benefit from a write-off of USD1 million out of its total debt of USD2.6 million to the Turks and Caicos Islands Airports Authority (TCIAA). In return, the airline will make a lump sum payment of USD1.6 million, effectively settling the matter. Similarly, Caicos Express Airways will see USD672,246.87 of its USD1.3 million debt written off, under the condition that the airline adheres to stipulated payment terms in the coming year.

On August 16, the Caribbean nation's House of Assembly approved a motion to this effect based on the Public Finance Management Ordinance.

The motion was tabled by Deputy Premier and Minister of Finance Jay Saunders, who explained the move was prompted by legal actions and disagreements involving landing fees and finance charges.

He said in 2016, TCIAA filed legal charges against interCaribbean Airways for the settlement of the long outstanding debt. The same year, interCaribbean Airways counter-filed against the TCIAA and the government for declaratory relief, calling on a waiver of landing fees granted in November 2001. He noted that TCIAA "may potentially be liable for costs and damages in the event of any adverse finding" by a court in relation to the legal challenge.

"It is not possible to predict the decisions of the court or estimate the amount of such awards, if any…and the board and management of the TCIAA are of the opinion that the best resolution of this matter is a settlement outside the judicial system," he explained.

Saunders emphasised the importance of supporting domestic airlines during challenging times and establishing a clear path forward for collaboration. The proposal aims to benefit all parties involved by securing funds for TCIAA, easing the airlines' burdens, and ensuring continued air connectivity. "It's a solution that benefits all involved. It secures substantial funds for the TCIAA, alleviates the burdens on our airlines, and ensures that our citizens continue to enjoy uninterrupted air connectivity," Saunders concluded.