Will Bermuda's Gamble Bring Back Luxury Ships?

June 10, 2008

In a move that signals an increased sense of urgency and -- dare we say -- desperation, the government of Bermuda has passed measures that will overturn a long-held ban on the operation of cruise ship casinos and suspend a cabin tax currently levied on ships calling on the island.

The legislation is aimed at reviving Bermuda's wilting popularity as a cruise destination, especially among luxury lines, which have greatly decreased visits to the island in recent years. Regent Seven Seas Cruises, the last luxury cruise company to offer seasonal sailings to Bermuda, pulled out after its 2003 season and has no desire to return.

"At this time, we have no plans to reinstate a full season of calls," an RSSC spokesman told Cruise Critic.

Once considered among the world's most prestigious cruise destinations, there was a time when Bermuda tourism officials could pick and choose which lines they allowed to call on the island's sought-after ports, denying visits to larger mega-ships for years in an effort to prevent overcrowding. Uniquely, it also required most ships to stay for three full days (though now only NCL's Norwegian Dawn, and Royal Caribbean's Grandeur of the Seas and Explorer of the Seas offer multi-day itineraries). A handful of other lines, such as Oceania, Silversea, Fred. Olsen, Crystal and Princess, occasionally visit Bermuda's ports for a day-long stop. The days of luxury ships doing Bermuda-only itineraries are gone.

The exodus of small and mid-sized premium ships, most of which have moved on to more trendy itineraries in the Mediterranean and elsewhere, has hit Bermuda hard.

As a result of overturning the restrictions, cruise lines will be able to open casinos and shops after 10 p.m. Allowing ships to open casinos at night is a big deal precisely because most of Bermuda's cruise calls are multi-day commitments. As such, passengers traveling on Grandeur of the Seas, for instance, could only access the casino during sea days. The new policy runs counter to the island nation's otherwise strict gambling laws, which prohibit gaming houses.

The government also acted to eliminate the $14 cabin tax currently levied on ships calling on the ports of Hamilton and St. George's -- where smaller luxury ships typically dock -- for a period of three years beginning in 2009. The benefit of that repeal could be negligible as most ships are now too large to enter either port and must dock at King's Wharf, which is not included in the repeal.

According to a report in Bermuda's Royal Gazette -- opponents of the initiative predictably criticize the government for not allowing public discourse on the issue, and claim that allowing cruise ship casinos to open will hurt local business by enticing passengers to remain onboard at night. What's not said, however, is that King's Wharf, the primary cruise facility, is located well away from most sources of nightlife in St. George's and Hamilton.

Even with the changes, Bermuda still stands to gain if cruise lines return. Those already operating the multi-day runs will make hefty monetary contributions to support Bermuda tourism, according to the Royal Gazette report. Premier and Tourism Minister Ewart Brown, who spearheaded the initiative, told the newspaper that Norwegian Cruise Line has already made commitments that include paying $150,000 per year to the Bermuda Music Festival, and donating $275,000 to the Bermuda Heritage Museum and St. George's Foundation.

NCL has not yet responded to a request for confirmation of those arrangements.

Brown also reported that negotiations are underway for a similar commitment from Royal Caribbean.

--by Michael Potter, Assistant Editor