Mixed Reactions Trail FG Position on Destination Inspection

13 Jan 2013

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Comptroller-General, Customs, Inde Dikko Abdullahi

The Federal Government about two weeks ago extended the contract for destination inspection of goods at the nation’s ports. The decision came at a time when the Nigeria Customs Service (NCS) had prepared to take over the scheme fully from the Destination Inspection Agents (DIAs), reports Francis Ugwoke

The news about two weeks ago extending the contract of destination inspection to three Destination Inspection Agents (DIAs) came as a surprise to industry stakeholders. But the news may have jolted the management of the Nigeria Customs Service (NCS) the more. In the past few weeks, the Customs had celebrated a possible take-over from SGS, Global Scan and Cotecna that provided the scanning services at the nation’s ports and border stations.  The Comptroller-General of Customs, Inde Dikko Abdullahi, had at the Customs Annual Conference held in Katsina recently boasted that the Service was ready to take over from the agencies. Abdullahi had claimed that his Service has all the facilities and expertise to take over the scheme. But the Federal Government decision may have proved the Customs boss wrong. However, in the past one year, Customs appeared to have prepared for this with training and retraining of thousands of officers that will implement the scheme.  This is moreso with a clear picture that the contract of the DIAs was going to end December 31 last year.

Customs had as part of the moves to really take over from the DIAs issued notices to its commands and freight forwarders introducing Pre-Arrival Assessment Report (PAAR) to replace the Risk Assessment Report (RAR).  In line with the Single Window system, Customs Comptroller-General had explained shortly before the Federal Government extension of the contract for the DIAs that PAAR was expected to be “a once-and-for-all document for clearing of goods in the ports”.  PAAR addresses the issue of under-valuation usually blamed on the DIAs for which Customs had to resort to issuing Debit Notes (DNs) that contribute to the delay in goods clearance at the ports. However, all these preparations have been put on hold with the decision extending the contract of the DIAs.

The Contract between FG and DIAs
The contract for destination inspection was signed seven years ago at a time that the Federal Government decided to end the scheme of pre-shipment inspection.  Following the failure of pre-shipment inspection, government decided that it was better to introduce destination inspection which means that goods are inspected on arrival in the country. Incidentally, some of the PIAs turned out to be engaged as DIAs in the Destination Inspection regime.

The DIAs while working with the Customs provided the scanning equipment to be able to check importation of dangerous weapons into the country.  Under the contract terms, the Customs Service was to take-over from the DIAs who was expected to provide trainings for the customs officers.  In keeping with these terms, the agencies were believed to have done this, and this explained why the Customs Service prepared to take over the scheme until government changed this plan.

Why the Contract Was Extended…
The reasons for the extension of the contract has not been clear, but industry sources said it may not be unconnected  with the strong feeling by government that  the Customs management  was ill-prepared for the assignment. Though the Customs boasted that it was ready for the scheme, it is still surprising how it would have done this without adequate equipment for the job.

The customs indeed has the personnel who are qualified for the job, but there was no information that the Customs tried to inherit the scanners that were being used by the DIAs for the job.  The DIAs were believed to have swiftly withdrawn their personnel that manned the scanners in what would have been a mess at the ports if the government did not extend the services of the agencies. The Customs, it was gathered was planning to carry out the scheme through physical examination, a system that government believes will not achieve fast clearance of goods at the ports.

How Clearing Agents Worked Against Customs
Apart from the weaknesses of the Customs in terms of failing to arrange for scanning equipment at the ports, some top officials of the DIAs were said to have engaged freight forwarders to ensure that their contract was extended. A top official of one of the firms was said to have engaged some top clearing agents who betrayed the Customs by insisting that it is not prepared for the scheme. The clearing agents were said to have been invited to Abuja to make a strong case before the Finance Ministry and Presidency officials who based on this information extended the contract of the DIAs.

What Stakeholders Say
Freight forwarders who spoke to THISDAY on the extension of the contract said it came as a surprise.  However, founder, National Association of Government Approved Freight Forwarders (NAGAFF), Dr. Boniface Aniebonam told THISDAY on phone that government is in a better position to make decision for the people knowing what is better for them.”They may know things we don’t know, both government and customs are working together”, he said.

He said there is no need to dissipate energy on the issue, adding that what is needed is to give government the support it needs.
President of the National Council of Managing Directors of Customs Agents (NCMDCA), Mr. Lucky Amiwero welcomed the decision to extend the contract. His argument is that Customs did not prepare for the take-over. Like Aniebonam, he referred to the issue of scanning equipment and necessary training, and argued that the Service may not have coped.

Former Chairman of the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN), Iju Tony Nwabunike welcomed the extension of the contract of the DIAs, arguing that it makes room for consistency. He recalled that some of the agencies had acquired  equipment that are not up to one year,  adding that it is normal that contract terms are reviewed on expiration. .Nwabunike when asked to rate the performance of the DIAs said that though it was not initially fantastic, it is now improving.

However, other industry stakeholders believe that the programme introduced by the Customs to take over from the DIAs was perfect and could have changed so many things in the ports.

They pointed to the Single Window option and the transition from RAR to PAAR as capable of actually leading to fast clearance of goods at the ports with its global acceptance. A freight forwarder, Mr. Onchie Ibuzor blamed government for insincerity and for dancing to the tune of few beneficiaries of the system and those who were ‘recruited’ to work against customs on the planned take-over.

Tags: Business, Nigeria, Featured, Destination Inspection

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