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Lawyer: no regulations govern parcel post operations

The Bermuda Post Office’s controversial partnership with an overseas courier company was effectively no different from dealing with other post offices worldwide, a lawyer for the Government argued yesterday.

Eugene Johnston made the case at a Court of Appeal hearing in which the Government challenged a ruling by the Supreme Court that it had acted unlawfully when setting up an online shopping and shipping platform in partnership with an overseas company.

MyBermudaPost was announced in November 2020 as a public-private partnership by Wayne Furbert, then the Cabinet Office minister.

The government-run Bermuda Post Office teamed up with the US courier Access USA Shipping LLC to import goods purchased online by island consumers.

In discussing the scheme three years ago, Mr Furbert criticised island retailers for failing to meet customer demand, insisting that the Government had stepped in to provide the public with a much needed service.

He also dismissed claims by island couriers that the Government should have put the contract out to tender before signing a deal with a US supplier.

The contract was challenged by the local courier company Mailboxes Unlimited, which has an outlet in the US.

Mailboxes argued that the Government was subsidising a foreign company to the disadvantage of Bermudian firms.

Last August, Chief Justice Larry Mussenden, then a puisne judge, declared that the Government’s contract with the foreign courier was unlawful because it had failed to abide by its own procurement code.

He also asked the Government to provide details of its contract with Access USA to establish how it could be terminated.

In court yesterday, Mr Johnston said the post office had to make use of its parcel post service to be competitive.

In his grounds of appeal, he told the court that Bermuda contained nine competing parcel post providers, adding: “So there is business there.

“The question is, is it permissible for the post office to compete with those nine other service providers, and what method they can use to do so?”

Mr Johnston said: “As far as the parcel post, there are no regulations over those nine competing businesses.

“The post office functions on ring-fencing. Their services begin and end in this country. They have no reach outside of this country — they cannot fill a consolidated factory such as in the UK and US.”

He said: “They need some other entity to do that.”

As such, he said, the post office needed a company to partner with, and the deal was struck with Access USA.

He said Access USA was ”no different from other post offices worldwide”.

“Post offices consolidate and forward mail. That’s their base function.”

Mr Johnston said Access USA “did not operate inside Bermuda, it operated outside”.

He argued that there was “no challenge to the arrangement” the Government made with Access USA.

“The claim brought by Mailboxes was simply that you couldn’t enter into the agreement without first there having a process.”

The lawyer told the hearing that his legal team “made a positive assertion” that no procurement was necessary for the deal with Access USA because of the structure of the island’s laws.

He said the arrangement was a public-private partnership with an international company.

Mr Johnston also told the court that Mr Justice Mussenden had relied “upon what he called inferences every chance he got” in his judgment.

Court of Appeal president Sir Christopher Clarke, with judges Sir Anthony Smellie and Ian Kawaley, presided over the hearing.