Government has decided not to renew Sovereign Group Ltd.'s licence to offer private jet services due to a material breach, The Royal Gazette can reveal.

A Ministry of Tourism and Transport spokesperson said the matter was separate from a court ruling upholding Bermuda Aviation Services's (BAS) exclusive rights to offer such services at LF Wade International Airport until 2014 following Government's contravention of the agreement by granting Sovereign Flight Support permission to offer a rival private jet service.

Sovereign's licence expired at the end of June, but on Friday it still appeared to be in operation, both listed on the Department of Civil Aviation's website as providing aircraft handling services and with its details advertised on the Controller.com website.

When contacted later the same day, Kenny Burns, president and CEO of Sovereign Flight Support, said he was still in his position and he had not heard anything about the company's licence not being renewed.

However, a woman who answered a call to the company's switchboard on Friday said Mr. Burns was "no longer with Sovereign".

The Ministry spokesperson said: "The licence agreement for Sovereign Group Ltd. reached term on June 30, 2009. Government exercised its right not to renew said licence as a result of a material breach. This matter is separate from the matter regarding BAS exclusivity ruling."

BAS had its exclusivity deal extended six years ago.

Government lost its second appeal after being found in breach of BAS's exclusive rights to provide private jet services at the airport, after the company and its subsidiary Aircraft Services filed a writ against Premier Ewart Brown, in his capacity as Minister of Transport, as well as Attorney General at the time, Phil Perinchief, in June 2007.

The case eventually went to arbitration almost a year-and-a-half later, with the court ruling in BAS's favour in December 2008.

But, having lost at arbitration, Government sought leave to appeal the decision in December last year, but the appeal was refused at Supreme Court on January 8 and a subsequent appeal was turned down at the Court of Appeal in March, as exclusively reported in the Gazette.

Under the terms of the arbitration hearing, chaired by a three-man panel of lawyers, the ruling was supposed to remain confidential for the immediate future, but the Attorney General's Chambers revealed back in January that the court had ruled in BAS's favour and that Government had put in an application for leave to appeal the decision.

Despite the ongoing case and BAS contesting that Sovereign had not competed in the tender process for the right to offer the service, Sovereign went ahead and converted a former US Air Force building at Carter House in Southside into a private jet passenger terminal, which officially opened in May 2008.

From the outset of the case, BAS maintained that the Ministry would also be going against the advice of its own technical advisers if it granted Sovereign permission to operate private jet services, with Mr. Joaquin saying BAS had won an exclusive right to offer private jet services through an open tender in 1997 and made its concerns over the breach known to the Transport Ministry.