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Govt Directs NLNG to Pay Outstanding Levies to NIMASA

18 May 2013

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NIMASA

By Tokunbo Adedoja                                   

The dispute between the Nigerian Maritime Administration and Safety Agency (NIMASA) and the Nigerian Liquefied Natural Gas Company (NLNG) over the payment of taxes and levies has been resolved in favour of NIMASA, THISDAY has learnt.
An arbitration panel, which looked into the dispute was said to have aligned itself, on Friday, with the position that NLNG was not exempted from paying taxes and levies to the agency.


Though the outstanding payments have not been determined, it was gathered last night that the two agencies had been directed to meet next week to resolve the issues by working out the outstanding fees and modalities for payment.
The face-off between NIMASA and NLNG had climaxed early this month when NIMASA grounded all operations of NLNG over non-payment of taxes and levies to the agency.
Using GlobalWest Vessels Specialist platforms, NIMASA had blocked off access to the Bonny Channel from the fairway buoy at the beginning of the channel to buoys 17 and 18, thereby preventing all NLNG vessels operating in the area from leaving or entering the area until all statutory obligations were met.


NLNG had consistently maintained that the NLNG Act exempts it from paying taxes and levies as an incentive for the investment of its shareholders, and from the payment of taxes for a period of 10 years or  until the achievement of certain threshold in the price of gas, and that its enabling Act also exempts it from being bound  by any new laws, regulations, taxes and charges.


NIMASA, on its part, had insisted that it was mandated by its Act to collect three per cent of gross freight on all international inbound and outbound cargo from ships or shipping companies operating in Nigeria to meet its operational costs.
NIMASA had also argued that the Cabotage law stipulates a payment into the Cabotage Vessel Financing Fund, of a surcharge of 2 per cent of the contract sum performed by any vessel engaged in the coastal trade.


The Federal Government however appointed an arbitrator to resolve the dispute and several sittings were held in Abuja where both sides presented their positions for arbitration.
In order to resolve the dispute within the confines of the law, the arbitrator was said to have asked the Attorney General of the Federation, Mr. Mohammed Adoke, to submit a position paper on the dispute.


Though copies of the resolution could not be obtained as at the time of going to press, THISDAY gathered that the Attorney General made a four-point submission to the arbitration panel that consequently led to the resolution of the dispute in favour of NIMASA.


The AG, it was gathered, submitted that NIMASA Act was not discriminatory and was generally applicable and that NLNG could not claim exemption because, unlike military vessels which were clearly exempted, Section 2 (1) of the Act covers NLNG.


The particular section reads:  "The Act shall apply to ships, small ships and crafts registered in Nigeria and extend  to ships and crafts flying a foreign flag in the exclusive economic zone, territorial and inland seas, inland waterways and in the ports of the Federal Republic of Nigeria."
When contacted last night, NIMASA spokesman, Mr. Isichei Osamgbi, confirmed that the dispute had been resolved in favour of the agency


"FG intervened, as you know I am aware  that the issue has been resolved in our favour. We are happy that the resolution is in our favour. We have already initated conversation on how to sort out modalities for the payment of outstanding fees", Osamgbi, NIMASA deputy director and head of public relations, said.


However, when contacted on the phone last night, NLNG's Manager of Corporate Communications and Public Affairs, Gloria Ita Ikpeme, refused to comment on the recent development.

Tags: Nigeria, Featured, News, NIMASA

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