—– attribute sluggish port processes, high port costs to physical examination of cargo
—- Customs processes contribute 81.7 to costs of port operations
The Operators of terminals at the Nigerian ports have slammed the Nigeria Customs Service for reversing the great milestone recorded by the port concession programme of 2006.
The Chairman of the Seaport Terminal Operators Association of Nigeria(STOAN) Princess Vicky Haastrup, who ventilated the feelings of the operators, said the Customs’ incurable passion for 100 percent physical examination of cargo has set back the progress which the ports have made after exiting the chaotic, disorderly and sluggish port services that characterised the pre- concession era.
Princess Haastrup was speaking as a lead speaker at the one-day town hall meeting organised in Lagos yesterday by the League of Maritime Editors to discuss ”Achieving Effective Digitalization Nigeria’s Maritime Industry.”
The STOAN Chairman, who was unsparing in her condemnation of the damage the customs’ archaic cargo clearance procedures have done to the well being of the port industry, said that despite the gains recorded since 2006 with the efforts and investments of the terminal operators and the Nigerian ports Authority ( NPA), the Customs operations have continually been a drag on the efficient service delivery at the Port.
“The efficiency of our ports has improved multiple folds.
“Vessel waiting time has since been eliminated resulting in significant savings for importers and exporters.
” Government now generates revenue in trillions of Naira – through the tax authorities, Customs, NPA and NIMASA – as against the few billions generated before the concession.
“The concession, without a doubt, has increased the competitiveness of our ports and enhanced movement of goods across international borders.
“I am also glad to inform you that all terminal operators in the six seaports across Nigeria today have effectively deployed technology to drive their operations.
“Consignees and their agents do not need to be at the port physically with regards to their transactions with terminal operators.
“The question that may readily come to your mind at this point will be: why then are there so many people visiting the ports daily in connection with their consignments?
“Why is the cost of doing business at the port still high? Well, my answer to this question is Customs processes.
“Despite the tremendous improvements recorded in cargo handling operations and the provision of marine services by NPA, consignees and their agents still face numerous man-made hurdles at the port because cargo clearing processes have remained manual.
“Customs’ cargo clearing systems in Nigeria, using the words of a former CEO of Nigerian Shippers’ Council Mr. Hassan Bello, have remained “archaic”.
Haastrup believed that this outdated mode of goods clearance by the Customs has not only become a breeding method for extortion and corruption, it has also significantly slowed down the process of cargo clearance at the port.
“From the point of 100% physical examination of cargoes, the discretionary powers of Customs officers kick in.
“Negotiations and underhand dealings inevitably happen due to unbridled human contact.
“A study conducted by Akintola Williams Deloitte in 2017 blamed the high cost of doing business at the nation’s seaports on the Nigeria Customs Service and other government agencies.
“The study stated that Customs processes are responsible for not less than 81.7 percent of the charges incurred by consignees.
” It said Shipping Companies are responsible for 13.8 percent of the port cost; Terminal Operators 1.4 percent; Transporters 1.4 percent and Clearing Agents 1.7 percent.” she quoted.
Princess Haastrup maintained that a major reason for the high cost associated with Customs is manual processes.
She however stated that the only solution to this problem is for the customs to embrace automation in its cargo clearance process by reducing the level of manual process to about 10 per cent and engaging in the use of digital technology such as scanners
“The solution to this major obstacle is to drive the clearing process from end-to-end with digital technology.
“The human interface and the discretionary powers of officers should be taken out of the mix.
Haastrup lamented that manual examination of cargo by Customs has assumed an endemic nature which if not checked will continue to denigrate the efforts of the government to attain proficiency in port Operations.
“Manual examination of cargoes has assumed the proportion of an endemic sore point in Nigeria’s Customs administration.
”The Nigeria Customs Service performs 100 percent physical examination on almost all cargoes passing through the ports.
“This is not efficient and it constitutes a huge drawback to port efficiency. The manual inspection by Customs contributes in no small measure to the high dwell time of cargoes at our ports.
” It is also the main reason why importers and agents troop to the port daily. This is in addition to breeding corruption through numerous human contacts.
Haastrup also faulted the present arrangement by the government to procure a “few” scanning machines for customs.
She believed that apart from the fact that the number of the scanners procured is not enough, they should not be entrusted with the customs to manage for fear of sabotage.
She rather advocated for the engagement of the private sector to acquire and manage these scanners for efficiency as was previously done under the scrapped destination Inspection scheme.
“The solution is for the Federal Government to engage the private sector, as was done under the previous Destination Inspection scheme, to acquire high-end scanners for use of the Nigeria Customs Service.
“It is not enough to merely acquire a couple of scanners as the government is doing at present.
” A sufficient number of high-end scanners should be acquired to put a definitive end to manual cargo examination.
“The effective usage and maintenance of the scanners are also critical. Left in the hands of government officials, the scanners may be grounded in no time – as it happened before – and the system will be reset to the manual era.
“The services of risk assessment/management companies should therefore be engaged and retained for the purposes of providing, effectively utilizing, and maintaining the scanners.
” If we are truly desirous of creating efficiency at our ports, the manual examination will have to be reduced to less than 10 percent of the cargoes handled at the port, in line with international best practices.
“Full automation of the clearing process and the deployment of a sufficient number of scanners at the port will invariably cut down the multiple checks of cargoes by Customs and other security agencies” the STOAN Chief noted.
Exclusive! Customs heads to court to vacate injunction against Customs concession project
—-accuses aggrieved litigants of pulling out of project
The Nigeria Customs Service has instructed its legal team to head to court in a bid to vacate the restraining order on the implementation of the $3.2billion Customs concession programme.
A Federal High Court in Abuja on Friday has restrained the Federal Government from enforcing or giving effect to an agreement on the Customs Modernisation Project otherwise known as E- custom allegedly executed by its agents on May 30, 2022.
Justice Inyang Ekwo issued the orders while ruling on an ex-parte motion filed by two firms – E-Customs HC Project Limited and Bionica Technologies (West Africa) Limited, which was argued on Friday by their lawyer, Anone Usman.
However, the Nigeria Customs, through its National Public Relations Officer, Deputy Comptroller Timi Bomodi, said the service will go to court to challenge the order.
In an exclusive interview with our reporter, Bomodi declared that the management of the agency will not engage in what he called small talk over the matter that is already in court because that would be sub-judicial.
”We will go to court”, he declared emphatically.
We can’t be making small talk over a matter that is already in court, that will be sub judicial.
”Customs will make its reaction in court and that will be for the public to judge what the issues are”, the Customs spokesman stated.
He further explained that the litigants, E-customs HC Project Limited and Bionica Technologies (West Africa) Limited, pulled out of the agreement on their own accord when they said they could not accept the terms and conditions of the projects.
Bomodi stated that the Trade Modernization Project Limited; Huawei Technologies Limited and African Finance Corporation, who eventually won the concession bid, agreed with the same terms and conditions that the litigants rejected for the same amount.
”The people that took the Customs to court were in the beginning part of the process, they disagreed with certain parts of the agreement and they couldn’t go forward.
”Of course, if you have some people who disagreed with what you are planning together and they pulled out and they were not asked to leave, they pulled out on their own, does that mean because they were there in the beginning, the project cannot go on?”, he asked rhetorically.
”That doesn’t make sense.
”The project was conceived to help the service better and those that we started the journey together couldn’t agree with the terms and conditions of the project and they left and some other people came in to take up their slot.
”Those ones said they could achieve the same results with the same terms and conditions which the other party rejected” Bomodi said.
He stated that the Customs shall argue its case in the court and will leave the judge to decide the merit or otherwise of the case.
Customs shall be in court and do the needful”, the Customs spokesman concluded with emphasis.
The court, on Friday, also issued an order of interim injunction against the Federal Government or its agents acting through the Federal Executive Council from retrospectively ratifying the decision to concession the Customs Modernisation Project also known as the e- custom project to Trade Modernization Project Limited, Huawei Technologies Company Limited and African Finance Corporation.
The restraining order issued by Justice Inyang Ekwo of the Abuja Division of the court shall last till the hearing and the determination of a suit brought against the Federal Government and other parties by two aggrieved companies.
The two aggrieved companies, E-customs HC Project Limited and Bionica Technologies (West Africa) Limited jointly challenged the alleged unlawful and fraudulent concession of the E-custom project to the defendants.
Counsel to the two aggrieved companies, Anone Usman, had on behalf of the two plaintiffs, argued an ex-parte application praying the Federal High Court for the interim orders against the defendants to protect the interest of his clients.
Justice Ekwo, while ruling on the ex-parte application, granted the prayers of the plaintiff having placed sufficient evidence of interest in the concession project.
The judge also granted permission to the aggrieved companies to serve a writ of summons and all other filed processes on the African Finance Corporation at its head office, located in Ikoyi, Lagos through DHL courier services.
Defendants in the suit are the Federal Government of Nigeria; Attorney-General of the Federation; Minister of Finance, Budget and National Planning; the Infrastructure Regulatory Concession Commission; Nigeria Customs Service; Trade Modernization Project Limited; Huawei Technologies Limited; African Finance Corporation and Bergman Security Consultant and Supply Limited being 1st to 9th defendants respectively.
Justice Ekwo subsequently fixed June 28 for the hearing in the matter.
The two plaintiffs had in their statement of claim narrated how they proposed to carry out customs modernization project through several government officials for the benefit of the Nigeria Customs Service.
They claimed that after a series of meetings and negotiations with some of the defendants, President Muhammadu Buhari granted anticipated approval for the e- custom Project
They averred that on September 2, 2020, the Minister of Finance presented a memo number EC2020/153 to the Federal Executive Council, (FEC) the highest decision-making body of the Federal Government, and secured approval for the two plaintiffs to be granted the concession.
Plaintiffs further claimed that trouble started when the Nigeria Customs Service unilaterally reviewed the FEC approval and imposed other conditions among which are the shareholding formula and governance structure.
They claimed that the power of the NCS to unilaterally review FEC approval was protested and that the Comptroller General of Customs stood his ground.
Plaintiff asserted that to their surprise, they read in the news that the Nigeria Customs Service had executed a concession agreement with Trade Modernization Project on May 30, 2022, Huawei Technologies Company and African Finance Corporation, in total breach of the Concession Agreement vetted by the AGF in conjunction with the Minister of Finance.
They averred that Trade Modernization Project was incorporated April 2022 at the Corporate Affairs Commission with one Alhaji Saleh Amodu, a close friend of the Comptroller General of Customs as the chairman.
Plaintiff asserted that the new company, having been just incorporated in April 2022, could not have obtained and did not obtain the full business case compliance certificate from the Infrastructure Regulatory Concession Commission and the approval of the Federal Executive Council to carry out the e- custom project.
They, therefore, asked the court to make a declaration that the decisions of the Federal Government and its agents to enter into a concession agreement with Trade Modernization Project, Huawei Technologies Company and African Finance Corporation in respect of the e-customs project is illegal, null and void, having been made in gross violation of Section 2 of the Infrastructure Concession Regulatory Commission Act 2005.
They also asked the court to declare that E-customs HC Project Limited is the approved and rightful concessionaire for the e-customs project as approved by the Federal Executive Council at its meeting of September 2, 2020 and in line with Section 2 of the Infrastructure Concession Regulatory Act.
They also applied for an order of the court directing the Federal Government through the AGF, Finance Minister, ICRC and NCS to consummate the E- custom project with the 1st plaintiff as approved by FEC in September 2020.
Besides, the two plaintiffs asked the court to compel the defendants to pay them a sum of Two Hundred Million Naira as the cost of litigation.
The Federal Government had on May 30, 2022 signed the e-Customs concession agreement with Africa Finance Corporation (AFC) and China’s Huawei Technologies Limited.
The Comptroller-General, Nigeria Customs Service (NCS) Hameed Ali, while signing the agreement in Abuja, enthused that the implementation of the project will generate a revenue of $176 billion over the next 20 years.
Ali said, the e-Customs concession project would ease the cost of doing business, boost revenue, enhance productivity and put a stop to every arbitrariness in the service.
“The $3.2 billion e-Customs project to be financed by the Africa Finance Corporation (AFC) and managed by Huawei Technologies Limited under a 20-year concession window, when fully implemented, will quadruple Customs’ current N210 billion average monthly revenue collection” Ali declared.
The agents who allegedly executed the disputed concession agreement are the Nigeria Customs Service, Trade Modernization Project Limited, Huawei Technologies Company Nigeria Limited and African Finance Corporation.
Apapa Customs frustrates covert attempt to exit illicit drugs from port
20 containers of gold, silver ore stolen within Customs control in biggest heist operation.
Eyewitness reporter with agency report
The Mexican Customs Authority has announced the biggest heist in the history of the port when 20 containers laden with expensive gold, silver Ore and television disappeared from a freight yard within the Mexican Customs control.
According to the Head of Mexican Customs, Horacio Duarte, thieves stole the shipping containers this month from a freight yard in what was described as an organised crime.
The theft took place earlier this month but was not reported until Monday.Local newspaper, El Pais, reported that over a dozen fully-armed thieves broke into a private freight yard near a port in Manzanillo, dubbing it the “biggest heist’ in the port’s history.
The thieves reportedly gagged the guards at the yard and took eight hours to pick out the high-value shipping containers.
El Pais reported that the men knew how to use the cranes and other gear at the location and connected the containers to several trucks before driving away.
“It is unprecedented, there had been no robbery of this nature before this,” Gustavo Adrin Joya, a spokesperson for the security department of Colima state, said in a statement to El Pais.
The goods have not been seen since then, the local newspaper reported.
El Pais reported that the port is a main thoroughfare for the cartel, especially for unloading synthetic drugs that are made in Mexico and sold in the US.
While freight theft is not uncommon, it is unusual for dozens of containers to be stolen at once.
CargoNet’s Vice President of operations, Keith Lewis, told Insider freight yards can be a vulnerable place for high-value goods.
“A shipment is most vulnerable anytime it is parked,” Lewis said.
In 2020, cargo theft hit a record in the US as hundreds of thousands of shipping containers flooded ports and nearby shipping yards amid the supply-chain crisis.
Lewis said that multi-million dollar shipments like containers full of semiconductor chips or television sets are often fitted with security devices in the US, including covert trackers and specialty locks to deter thieves.
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