PHILIPSBURG – In a landmark decision, the Court in First Instance has instructed the Windward Islands Bank (WIB) Ltd. to no longer charge a 1 percent license fee over international transfers it executes for travel agency Travel Planners. The bank has to reimburse a bit more than $216,000 to its client, Travel Planners.
Travel Planners sells airline tickets and pays the International Air Transport Association (IATA) weekly through its WIB bank account; IATA then pays the relevant airlines. The bank charged Travel Planners the 1 percent license fee for each transaction.
Until 2012, the bank did not charge the license fee to Travel Planners but that changed when the Central Bank ruled that payments to IATA were payments to a foreign legal entity. To operate as a foreign exchange bank, the WIB has to pay the 1 percent license fee over these so-called A-transactions to the Central Bank. From 2012 forward, the WIB charged this fee to Travel Planners as expenditures.
The court ruled that there is no agreement between the bank and Travel Planners about charging the license fee.
The WIB elaborately pointed to the large impact a ruling in favor of Travel Planners would have “for her (the bank), the banking sector and even for the stability of the financial sector.” Ruling in favor of the travel agency would undermine this stability.
The court decided nevertheless to rule in favor of Travel Planners, though the ruling is not immediately executable.
This is because the court does not exclude that – based on the ruling – private clients, institutions and companies will initiate procedures against the WIB and against other banks.
The court also pointed to the consequences of Hurricane Irma for St. Maarten’s economy. “The court wants to prevent that the ruling hinders the recovery of the economy.”
The court ordered the WIB to pay Travel Planners $216,074.32 and forbade the bank to charge the license fee to the company. Violating this ruling carries a $1,000 penalty per violation with a maximum of $100,000. The bank also has to pay court costs to the tune of around 15,500 guilders.
Court verdicts in this case (in Dutch):
20170321 Tussenvonnis Travel Planners vs WIB.pdf
20171128 Vonnis Travel Planners vs WIB.pdf
