Miami rebuffs accusations on DBE compliance

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The managing partner of the Miami Airport Duty Free Joint Venture - LVMH-owned Starboard Cruise Services - has defended itself against accusations that it violated its duty-free agreement at Miami International airport, following a report from the Miami-Dade County Office of the Inspector General (OIG)

Starboard Cruise Services has issued a statement in which it says the recent report does not acknowledge the real and significant commitments undertaken by the joint venture to comply with the Disadvantaged Business Enterprise (DBE) programme requirements.
 
As stated in its formal response to the report, Starboard said the joint venture acknowledged that it erred by not fulfilling one aspect of the programme requirements of its agreement with the airport. The joint venture and its partners regret this error and are working as rapidly as possible to satisfy the DBE operational participation aspect of the agreement - a cure that is explicitly permitted and provided for in the agreement.
 
Starboard said in addition, the report contains misleading information that has created confusion in recent media reports. "For example, it is not true that the minority partners have received $14.6m in profits from the joint venture. The joint venture generated $43.3m in gross revenues, not profits, during the period December 2000 through November 2001. The $14.6m mentioned in the OIG report represents the percentage of gross revenues allocated to the partners."

"The amount of profits received by the minority partners was considerably lower than the gross revenues allocated to them. In fact in light of the current economic conditions in the travel sector the joint venture is currently unprofitable", said Starboard.

• For further background, see our story "Miami operator criticised for violating duty-free agreement" which appeared on TRW earlier today.