Imperatives of Passing the Maritime Sector Bills
Eromosele Abiodun writes that the plea by the federal government for the House of Representatives to support its effort to review and amend many of the moribund laws and regulations in the maritime sector is a major step in the quest to move the sector forward
Following the conclusion of the port reform programme by the Bureau of Public Enterprise (BPE) without a legal framework, the House of Representatives initiated the Ports and Harbour bill. Ten years after cargo handling operations have been handed to private operators following the port reforms in 2006, the legal framework is still pending.
Regarded as one of the most important bills to Nigeria’s maritime sector, the Ports and Harbour bill was designed to provide adequate framework for the private sector participation and to promote efficiency based on the principles of accountability, fairness, competition and transparency.
However, the non-passage of the bill has become a major cause of concern for many stakeholders in the maritime industry, especially concessionaires who are worried that the bill, when passed into law, assures the terminal operators of the concession.
During the 7th National Assembly, most maritime stakeholders were in high spirits that the bill would be passed into law. They were rather discouraged when the blame game over who was delaying the bill became the order of the day.
The bill when passed into law ought to give a legal backing to the entire port reform programme and also create an Independent Port Regulatory Commission for the port industry as done in other climes where the landlord port model, such as Nigeria’s is practiced.
In 2014, the Senate Committee and House of Representatives Committee on Marine Transport expressed open dissatisfaction over the failure of the Presidency to submit the Ports and Harbour Bill and the Nigerian Transport Commission Bill to the National Assembly for necessary action.
Other maritime bills before the National Assembly include: the Chartered Institute of Shipping of Nigeria (CISN)Bill; the National Transport Commission Bill, the Bill Establishing the Economic Regulator (shipping sector); the National Inland Waterways Authority Bill; the Maritime Security Agency Bill; and Nigeria Railway Bill, the Maritime Zones Bill.
As part of the measures to speed up the passage of the Ports and Harbour Bill and several other maritime bills before the national assembly, experts have advised that stakeholders pile up pressure on the Senate Committee to enable them see the benefits of the bills to the maritime industry and the nation at large.
The experts also advised stakeholders so invite the Senate and House of Representatives Committees to maritime symposiums to expose them to the reality of the maritime industry. Critical stakeholders were also urged to conduct researches on these bills, their applications in other countries and the results and send these findings to both chambers. Meanwhile, there is hope that the bills may soon be given the needed attention if the recent request for support for the passage of the bill by the federal government is anything to go by.
FG seeks Reps support
Last week, the federal government urged the House of Representatives to support it in its effort to review and amend many of the moribund laws and regulations guiding the management and operations of the maritime sector.
Minister of Transportation, Rotimi Amaechi stated this while speaking at a two-day retreat of the House of Representatives Committee on Ports, Harbours and Waterways in Lagos.
Amaechi, who was represented by the Permanent Secretary, Ministry of Transportation, Sabiu Zakare said the review and amendment of the laws would make them not only relevant but also capable of handling current challenges and developments in the industry.
Amaechi also asked for adequate allocation in annual budgets for the implementation of critical maritime projects and programmes towards the realisation of the change agenda of the Buhari administration.
According to him, “In this respect, the honourable members may wish to be informed that currently, several states governments in the federation have enacted legislations which are in conflict with the powers conferred on the federal government for the management and operations of ports and the inland waterways.”
In his speech, Speaker of the House of Representatives, Yakubu Dogara, said the transport sector is vital to the diversification and growth of the Nigerian economy.
He therefore called for a suitable synergy between the legislature and the executive foe a sustainable partnership between the two arms of government.
Dogara, who was represented by the Deputy Chief Whip, House of Representatives, Mr. Paley Eriase pointed out that the present economic recession is undoubtedly taking its toll on Nigeria adding that all hands must be on deck to support the government in its determined efforts to create and propel other sources of revenue to boost the economy.
Specifically, he said: “I am happy to say that we in the legislature are fully committed to giving maximum support to the timely passage of the 2017 budget so that implementation of the projects of the Federal Ministry of Transportation can commence. Let me use this opportunity to comment Mr President for the giant strides he has made in the transport sector within a short time, especially in the rehabilitation and revitalisation of the rail infrastructure as disclosed by oversight reports.”
The Nigerian ports and the maritime sector, he said, has the potential to sustain the economy adding that the present administration is doing a lot to reposition the sector.
He added, “It is truly heart-warming that the industry stakeholders have finally agreed on the importance and inevitability of an economic regulator as evidenced in public hearing the house conducted on the National Transport Commission Bill. One of the decisions that should come out of this retreat is the shape and form of an industry regulator and the need or otherwise of the National Transport Commission.”
On his part, the Chairman House of Representatives Committee on Ports, Harbours and Waterways, Patrick Asadu said the retreat would arm members with the real time knowledge needed to revisit the relevant laws by way of amendments so as to bring them up to speed with international standards, “with the specific aim of re-engineering our nation al economy through the maritime industry.”
He added that the leadership and members of the House of Representatives are determined to conclude all outstanding transport sector bills pending before the house, especially those related to the maritime sector.
“The committee attaches importance to the key issues in the pending laws and the soon to be concluded NTC Establishment Bill which public hearing had long been concluded and report prepared to be laid before the house upon resumption, “he said.
NPA Seeks Quick Passage
Also speaking, the Managing Director, Nigerian Ports Authority (NPA) Ms Hadiza Bala Usman urged the National Assembly to pass Ports and Harbours Bill, National Transport Commission Bill and other maritime bills before it to boost port development plan.
NPA, she said, was committed to capacity building of its workforce because its business is international and requires that the agency constantly keep abreast with global developments and cutting edge in technology and shipping developments. Thus in building capacity, NPA staff exposure to the international scene is vital.
She said there was an urgent need to pass the bills to replace the existing obsolete laws, which are not supportive of developmental goals of the country.
NPA, she said, was excited about the efforts by the Federal Government to reform and develop other related areas such as Inland water ways and ports, rail way and road network to promote inter-modalism, which, according o her, is very key to the success of the port.
“This forum is coming at a most auspicious time, a time when the President Mohammadu Buhari led federal government is exploring ways of diversifying and improving the Nigerian economy. I must say that this is a very welcome innovation. This is the first time this kind of forum is being organized by the House Committee. I am particularly happy because it will foster exchange of ideas and collaboration and I hope it will become an annual event as the gains from it cannot be overemphasised.
“I am also grateful that the ports have been identified as key areas of the economy with the potential to put the nation back on the track of economic boom. One of the key objectives of the retreat is to expose the Honorable Members of the House Committee and stakeholders to the dynamics of the maritime industry, which are quite vast. It is very gratifying that we can count on the support of this Honorable Committee in our efforts to reposition the ports to play the desired role in the current economic agenda of the Federal Government,” she said.
From the objectives of the retreat, Ms Usman said NPA drew the following conclusions: “That our industry is one of the key areas of focus for economic development; That the National Assembly is committed to cooperating with the Executive to realize the development goals and objectives set for the sector; That the House Committee is concerned about bringing our sector up to speed with international standards and that the House Committee is desirous of creating suitable synergy between the National Assembly and the Federal Ministry of Transport.”
Need to harmonise the bills
The National President of the National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Lucky Amiwero disagrees with other stakeholders stressing that the bill has nothing much to do with the maritime sector.
“The bills cannot transform the marine time sector. We have so many bills before the national assembly from the sector. Our sector is more related to finance. The port and harbour is just a bill that is suppose to bring about new port act by repealing old one, look at what we are doing and try to see how we can work according to international best practice. But I have been in the assembly, we have seen the port and harbour bill. We believe that if the port and harbour bill is to be passed and the national transport commission bill is to be passed there is need for harmony within the port and harbour bill, the railway bill and national transport commission bill and the inland water ways bill.
“This is because it is a multi-sectoral regulatory arm. But if it’s not done and the port and harbour bill is passed it will be very difficult for you to pass the national transport commission bill. And if the transport commission bill is passed on its own that means the other bills will be passed with some elements of regulatory process in the bills in the laws which will be very difficult for the national transport commission to regulate those agencies. Like what is happening now, it looks like a railway bill is going on its own and if a railway bill is passed on its own, that means it’s no more being controlled by the national transport commission bill. And if the port and harbour bill goes on its own, that means it is off and will not be acceptable. If it is multi-soctoral bill there will need for us to look at it holistically and see how these bills can be pass for the benefit of the country.”
He called on the national assembly to put politics aside and pass the bills to ensure a better future for the maritime sector.
According to him, “These bills cannot be a political bill whereby I am passing it because I am the managing director today. They are bills that are going to midwife and reshape the maritime industry for the betterment of the economy. Because we are losing out, we control almost 80 per cent of the cargoes within the sub region and we have lost up to 60 per cent of the cargoes to our neighbouring countries. We have lost all our freight components to our neighbouring countries and you found out that Nigerians are moving out to all these neighbouring countries. They are the one doing the business there.
“What is the population of strength of Cote D’Ivoir, they are not more than 40 million but their tonnage is higher than Nigeria and who is the owner of those goods there, they are Nigerians goods. Togo, what is their population strength they are not more than Lagos and look at their tonnage; go round and see what we are talking about, it not just that some civil servant sitting down in Lagos and start to tell you one things or the other. Nigeria is losing out in a very serious way and this is very serious issues because the freight components which create employment are being diverted to other countries. Once a ship diverts, it goes with the freight components and you come back with the cargoes. The freight components are those charges that are supposed to be for Nigerians. For instance, if a cargo which is supposed to be for Lagos is diverted to Togo, the charges the shipping company is supposed to charge, the service the terminal operators is supposed to charge and the charges the licensed custom agent is supposed to charge and the transporters are now going to be charged there.”
He added, “And when these goods come in, they come in just like that and only pay import duty. So, those components are what we call freight components because we paid you for it. So, Nigerians are entitled to their freight payment. That’s why in all over the world, freights are teamed with struggle because that freight is what generate employment. In our case, our freights are left alone for diversion and more than 60 per cent are out of this country. And these goods are still coming into this country perfectly. That is why you find out that our unemployment level is terribly high.
“You cannot continue to run a team without experts. Most of the people who are managing these areas are not experts. Most of the go to government and give them wrong information. Most of these information’s are not correct. Because when you go, you have to look at what is happening in Ghana, Togo, and Cameron and others. These are our competitors and for every increase you make here, they deduce their charges for them to attract our cargoes. So it is a very serious issue. It is not an issue of one just sitting down and someone who doesn’t understand just take over and that is the end of the whole thing.”
Apart from the Ports and Harbours Bill, National Transport Commission Bills that are yet to be passed, another Act, the Customs and Excise Management Act (CEMA) that is said to be very important for the nation’s economy, has also attracted many controversy.
Last year the Nigeria Customs Service (NCS) presented its draft bill for amendment of the Customs and Excise Management Act (CEMA) to maritime industry stakeholders for observation and input before submission to the National Assembly for consideration and passage.
The CEMA is the principal law guiding the Administration of Customs and Excise in Nigeria. It is divided in to 13 parts, spanning 195 Sections and 3 Schedules. Section 37-5 deals specifically with Duty on Imported goods, Relief from duty of goods entered for transit or transshipment; Relief from duty of goods temporarily imported, Exempt from goods and goods delivered free of duty; Valuation of imported goods for purpose of ad valorem duties among others. This is not the first time effort has been made to review CEMA.
In 2010, the federal government forwarded a bill to the National Assembly requesting that the lawmakers repeal and re-enact the CEMA 2004 as well as repeal the existing Destination Inspection Act 2003 to allow Nigeria Customs Service take over all obligations of the Federal Ministry of Finance and the CBN under the Act. At that time, there were indication that the National Assembly tinkered with the Customs CEMA in order to make it more proactive to meet the challenges of a modern day customs service. This, the lawmakers said, became necessary after it was discovered that some of the conditions adopted by the CEMA to deter crimes especially via fines were no longer relevant or stringent enough to deter such crimes.
THISDAY gathered that the CEMA, enacted in the 1950 does not reflect the sovereignty of an independent Nigeria.
“The CEMA does not reflect the realities of modern day international trade and it is also silent on Destination Inspection of the present day NCS.
Trade practices procedures and sanctions that existed in the 1950 are no longer relevant, fines and penalties prescribed by CEMA are ludicrous and generally incapable of deterring economic criminals even if fully enforce,” said a player in the maritime industry who pleaded anonymity.
He stated that the National Assembly in the course of its statutory over sight functions had discovered that if the service was to incorporate Customs practice, traditions and obligation, then various recommendations and instrument on Customs and trade standard practice must be in consonance with the World Customs Organisation (WCO), the United Nation Trade and Development (UNICTAD) and the World Trade Organization (WTO).
“For Nigeria to fully exploit the benefits of its strategic placement and its ambition to be the maritime hub of the sub-region, our trade laws, especially as they relate to NCS operations must be made very simple and harmonised, with that of other Customs organisations of the sub region,” he said.
Speaking on the issue of overtime cargo, he highlighted that the national assembly has a duty of transforming over time cargo task into a transparent Public Auction System (PAS); separate the board chairman from the supervising minister as is the case with other parastals under the Ministry of Finance (MOF) as well as make NCS operations to become more proactive.
He frowned on what he described as undue emphasis on revenue generation by the Customs service and advised that it was trade liberalisation that should be prioritised.
“Emphasis all over the world is on trade facilitation, liberalisation, economic integration and globalisation of markets rather than revenue generation which the CEMA stoutly promotes,” he added.
He charged the board of customs to carry out a holistic review and update of all customs notices, tariff, codes and books of instructions on imports and exports and harmonise them in line with global best practices.
CGC seeks stakeholders support
Speaking at a stakeholders meeting in Lagos, Comptroller-General, of customs, Col. Hameed Ali (rtd), urged stakeholders to consider national interest in their inputs to the review of the Customs and Excise Management Act.
The comptroller-general said that the review was necessary and overdue to enable the NCS to meet up with modern Customs administration under a template provided by the world customs organisation.
Ali said that stakeholders are strong pillars for any modern Customs administration, adding that, “Customs legal framework defines who Customs is, what it does and how or who the laws relate with. Over the years, both Customs and stakeholders have clamoured for a review of our enabling law which was first enacted in 1958.”
He added, “CEMA did not undergo any major review for over half a century. This attempt represents a collective resolve to update our laws and realign its provisions with modern realities. Most importantly, we need to take a second look at the provisions for sanctions that are neither punitive nor deterrent enough to promote compliance.”
He explained that the review of the CEMA was originally initiated by the last administration of Customs, adding that they could not get Presidential assent after undergoing the legislative processes.
Ali said that review process by the last administration, therefore lapsed adding that, “the present administration is back at the starting blocks again to review the CEMA law.”
The comptroller-general urged government agencies and stakeholders to always access customs trade hub for any information relating to any consignment coming into the country, without visiting any Customs office.
MAN, LCCI kick
The President, Manufacturers Association of Nigeria (MAN), Dr. Jacobs Udemba, said that the association recommended that the Minister of Finance should be the Chairman of the Board of Customs and not the Customs boss.
Jacobs said that there is the N1.5 million fine proposed to be paid by any person who infringed on imports, exports, transit laws or two years imprisonment.
He said that such fine should be increased to enable importers desist from such acts of infringement.
In the same vein, a member of the Lagos Chamber of Commerce and Industry (LCCI), Mrs Julie Ogboru, suggested that the Finance Minister should be the Chairman of the Board, while the Comptroller-General of Customs should be the Deputy Chairman of the Board.
Ogboru said that the inputs of all the stakeholders should be included in the review to enable them have a say in the implementation.
ANLCA, NAGAFF, CRFFN Position
In his contribution, the President of the Association of Nigerian Licensed Customs Agents (ANLCA), Mr. Olayiwola Shittu, said that all administrations set up for checks and balances should be abrogated.
Shittu said that Section 58 (1) of CEMA Law says “examination of goods should be at the examination bay.”
He said that there was no reason for officers to continue taking samples when there was no dispute on a particular consignment.
The Chairman, Murtala Airport Chapter of the National Association of Government Approved Freight Forwarders (NAGAFF), Dr. Segun Musa, said that there was need to review all fees imposed by all government agencies on importation, exportation as well as Transit goods.
He said that there should be fact of value of any particular consignment, saying that Customs officers should stop using their discretion to value consignments.
A representative of the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN), Mr. Okudili Alagbi, said that the CEMA law should allow the Council to be issuing licenses to all freight forwarding practitioners to fulfill the Council’s Act.
Alagbi said that the CRFFN Act 2007 stated the council’s obligations to all freight forwarding practitioners.
In his concluding Remarks, the Customs comptroller-general said that all the inputs of the stakeholders and other agencies would be looked into.
Ali said that the senior officers of Customs and the Review Committee would be having a three-day to review all contributions.
He said that about five chapters of the laws related to the stakeholders were the critical aspects of the law.
The comptroller-general said that all the suggestions would go through scrutiny, adding that only those suggestions that would add value to operations would be considered.
Ali said that every suggestion that would be added must be in conformity with the existing laws.