Non-assent to NTC Bill: A burden of unregulated industry

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By Eugene Nweke

I wish to undertake this particular statement on the basis of a sub caption: “Unregulated maritime industry and the Rest of us”.

Background

Annually, the Nigeria maritime industry generates revenues for the government, without a corresponding wealth/job creation. The industry from all available reports of researches indicates that many sectors of the industry are either untapped or under-utilized.

The industry is characterized by the prevalence of inadequately monitored cases of insincerity and criminal activities revolving amongst public executives and the corporate raiders. The absence of a legislated economic regulator (that is duly and fully supported by all arms of the government, while standing in as the central monitoring agency of the government) in the industry is a major factor responsible for the present state of the industry.

For instance, the lifeblood practice of organized crime where millions of gallons of toxic wastes are dumped indiscriminately into our marine environment and the impact of municipal sewer system, the adverse effects affect both the aquatics and human lives, apart from destroying revenues that would have been generated through fishing and healthy transport activities.

In the Industry, the international trading activities, millions of products known by their manufacturers to be faulty or even dangerous to human health are sold to unsuspecting public. Worst still, products quality regulatory standards is a major threat; the influx of fake, substandard and counterfeit products for both local and mostly imported seems to be a permanent condition of trading environment.

The adverse effect of capital flights and inflation, which undermines the purchasing power of the citizenry, speaks obvious. This requires a dual monitoring, so as to ensure that concerned agencies subject themselves to central monitoring umpire on behalf of the government, by so doing the concerned agencies will be strengthened and agencies’ compromises put on checks.

In some facets of the industry, it suggests an environment where deliberate programs are initiated for the attainments of operating legitimate business environment; rather officials of the agencies, firms (“corporate raiders”) cum concerned practitioners take undue advantage of the program, sacrifice the entire initiative on the altar of compromises and unwholesome practices.

Discovery enough, the activities of ‘corporate raiders’ over the years, now results to the establishment of industry scammers or con men almost in all facets of operations. It is almost a common sectors norm for this conmen to engage or conduct research into a clever new ways to defraud the government, by way of collective bilking, opening up loopholes and alternating certain fiscal policies.

The industry provides a symptomatic picture of a business environment in which nothing is quite what it appears. Imports racketeering and compromises thereof, as concocted in the boardrooms of the conmen, collaborated by internal theft (an official of the government agencies taking bribes, kickbacks aka “connivance for a fee”), continues to open windows for the soaring influx of counterfeit and substandard products into the country.

Without a central monitoring agency in the status of the National Transport Commission -NTC  (a general industry watch dog), the high corporate crimes that attracts media attention, becomes an individual moral laxity that leads other practitioners to join the bandwagon of “If you can’t beat them, you join them”. This is not good for the sustenance of the industry and the nation at large.

Dwindling Industry Fortunes

a).  Prompt Discharge of Function: “The responsibility of any business is not to knowingly do harm to an industry or the users of related services in the industry, but to make certain that it knows harm is being done and failing to act promptly”, inevitably much harms are steadily done to the business and business interests in the maritime industry. For instance, the Apapa port gridlock cannot be exempted from deliberate harm done to businesses and business interests. Why? Because someone as organ of the government, has failed to act promptly, but watched as the roads and traffic regulatory controls gradually degenerates into a state of chaos.

b). Impact of Greed: In the business environment, “Greed” is seen as a selfish motive, openly acknowledged and respected mostly in an unregulated business environment. Business itself has an underlying motive shared by all, that is ‘greed’, except if otherwise regulated. It is on the basis of greediness inherent in our maritime industry in general, that gave impetus for reconsideration on the non-assent or signing into law the National Transport Commission Bill.

On one hand, it is seen as an open admittance on the part of the government that it has no indepth knowledge of the implications of an unregulated maritime industry, thereby encouraging the existing brazenness to greed in the port industry or in other hand the government is at home with the private sector oligopoly.

c). Arbitrariness and Impunities in the System: Presently, in the port industry, it has been noted that, “For an operator to win patronages and must keep wining patronages by hook or crook or it will wither and die”. Wherefore, on the premise of this business thought, a shipper or his agent must loose capital or investment directly or indirectly (courtesy of extortive and exploitative practices/ charges). Indeed, arbitrary and extortive charges accounting for its profits earnings, is the only form of legacy they prides in.

From a practical stand point, where port services are not premised on innovative and efficient service delivery and competitive pricing environment, rather port related services thrive on basis of non-compliance and regulatory compromises in relation to international best practices/ standards. Quest to increase operating costs and willingness to cut corners (collecting fees for services not rendered) becomes the norm.

d). Profit Maximization without Recourse: The only meaningful standard that seems to exists and highly acceptable amongst the operators is profitability. Profits maximization without a corresponding services delivery or recourse to its impact on the national economy is a way by which they rate themselves. They rate their operational performance according to the profits or revenue it coasted into the bank, derivable from extortive and exploitative charges. Performances are not rated on the basis or level of value added to the industry which engender an effective and prompt services delivery.

e). The Concept of Quick Reap from Investment: The promotion of long term investment plan and practices that guarantee a gradual reaping from investment is now an old fashion. Short term plans and practices that guarantee an immediate reaping from investment is the order of the day. This particular practice drives the operators into all manner of exploitative activities in the port system. It is on record that, so far only the indigenous and two other operators have demonstrated capacity to invest meaningful on cargo handling equipment.

f). The Place of Corporate Morality: In our maritime industry today, what passes as “Corporate Morality” is akin to a non-particular moral opprobrium at incurring a penalty, any more to this, suggests  being in an off side position or wrong tackles in a football competition. The tradition is, if you break the rules, you pay the penalty and go back to the game but not evenly so in the maritime industry anymore, because the powers of the supposed Professional Centre Referee (respectable Central Regulator) is whittled unlike in the game of football centre Referee.

g). The Nigerian Shippers’ Council – Expectations or Regulatory Effectiveness: From the happenings in the port Industry, other agencies and stakeholders belated the Nigeria Shippers Council as not being the spectacle of a  bloated regulatory umpire the shippers and their agents  had expected. This assertion too, gave rise to this earnest modest.  Over the years, we have witnessed among some agencies and corporations, projects and even practices of dubious legality being given code names, the motive behind such acts may be hidden behind vague euphemisms and outright misnomer, but in all, it is a mere act to evade compliance/standards of practices.

In the industry, where judgement are secured against certain stakeholders by a supposed economic regulator, other than show of remorse, what obtains is for the guilt to engage and explore the services of politicians, mostly employed to derail the execution of judgements, by greasing their political mercenaries and tactics to encourage delays.

We have seen in some sectors of the industry where, the defendant to serious corporate crimes are convicted on pleas of “nolo contendre” (no contest), which are tantamount to admittance of guilty and pleas, and yet political greasing of mercenaries and tactics comes to play and the earlier pleas goes without carrying any stigma or punishment on the guilt. So, the crime repeats itself over and over again.

Another regulatory weak kneed but prevalent device is the consent admittance in the court as a first offender, in which the company or executives involved neither affirms or deny past delinquencies, but affirms they will not commit the said offences or crimes in question in the near future. This prevalent device has raised this important question: “Can a bank robber pay a modest fine, admit no guilt, and promise not to rob any more banks? This question begs for an answer.

But the truth is that, laws don’t seem to carry much authority in part because of the light punishment meted out to those who break them and which punishment serves as perpetual wrongdoings – indeed almost to sanctify it.

This can be likened to the short celebrated case between the Nigeria Shippers’ Council, Shipping companies and terminal operators. To say the least, company executives rarely feel the stings of judicial rebuke. Company may only collect a fistful of judicial and regulatory censures for ripping off Nigerian shippers and their agents, even committing unspeakable acts (extortion and exploitation) against the economy and industry, etc.

Citing for reference sake, of the essence of firm regulatory objectives, a comparative case scenario in America suffices. Sometimes in 1985, the U.S Air Force asked General Electric Company and the United Technologies Incorporated to pay back $208 million in alleged overbillings. Altogether, about four hundred suppliers have been suspended or permanently barred from defense contracts. In 1986, nine of the Pentagon’s top ten private sector contractors were under criminal investigation for alleged kickbacks and other fraud. The probes culminated in the conviction against firms like General Electric, Litton Industries Inc., etc.

The same feat was achieved last year 2018, when the Nigeria Shippers’ Council secured a judgement from an Appeal Court against the shipping companies, their association, the terminal operators and their association, for an alleged extortion, exploitation and overbillings of the shippers via different self-instituted illegal, arbitrary and illogical charges etc.

The question here is, what’s the level of enforcement of the said judgement? Has the guilty party desisted from such acts? Only the Nigeria Shippers’ Council can answer. At certain instances, questionable behaviour has taken the form of a concerted efforts to make the public pay for industry unregulated practices and private greed. Worst still, greed also encourages an unfathomable insensitivity.

h). Investors Adherence to International Best Standards and Respect to National Laws: It agitates the mind, given the extent of corporate wrongdoings often perpetrated by assuming respected and venerable private operators especially so, when you travel outside the shores of this country to see the same company adhering itself to international best practices and adherence to national laws and seriously committed to corporate social responsibilities.

The thought of knowing that the executive of a guilty organization continues to walk the industry freely without fear of going to jail on the basis that they are not responsible but the company is, beats ones imagination as to ask if we are in a failed Industry.

I). Corporate Crimes Most Times are Uneasy to Prosecute: However, it is appreciable to assert that corporate crimes are tough to prosecute. Oftentimes, no witness and intent is often impossible to prove. This perhaps suggests the handicap of the Nigeria Shippers” Council in its regulatory quests. But where given the necessary political supports and proper funding, it can adequately perform judging from its track records in the industry.

For instance, cheering enough, to note that with witnesses available, the Economic Financial Crime Commission (EFCC) recently secured a judgement against the immediate past Director General of NIMASA. That is by the way.

j). The Corporate Executives Excesses: A peep into the  excesses of the Chief Executives of a corporate operators and agencies of the government indicates that sometimes, imprudent, illegal conducts, and practices leads to non-performance of a given agency or an organization. From findings, in this excess practices, corporate miscreants are not alone, as general  lawlessness has taken hold among those that are supposedly at the front lines of social reforms, many seems to be entangled, but majority though still have their integrity intact.

The maritime industry have also seen and witnessed several policy formulation and initiative, which are merely self-seeking and very bad from the day it was initiated or formulated, yet received the endorsement of the government at the center courtesy of self-seeking lobbyists,  leading to monumental financial wastages.

k). Professional Misdirection: Some professional has often insisted that, they are caught up in righteous causes, when impatience suddenly drives them to ignore laws they do not like – this is the scenario around some shippers, their agents and government agencies.

L). Personal Professional Position: As a professional freight forwarder, what I consider as “Irony of Ironies” is that stakeholders and authorities are suspicious of the fraudulent practices in the port industry, but we can’t prove anything. Wherefore, it suffices to say that the fraudulent practices in the port industry could be likened to “Free Sex Situation: You saw the abuses growing, but you also saw an absence of people getting caught, so the atmosphere grew relaxed”.

m). On a Note of Conclusion: Unfortunately, the expectations from the stakeholders, that the present administration will look up to plights of the stakeholders by passing the NTC Bill into law was shattered and seemingly sacrificed on the altar of inter agencies rivalries and supremacy tussles. One such and simple approach to tackle corruptions is by enacting a legislative law that guarantees the existence of an industry economic regulator, especially in the maritime industry. This will be the hallmark of fighting corruptions in the land.

So, we all now ask the Ministry of Transportation: Nigeria Maritime Industry – Which Way Do We Go??

Dr. Eugene Nweke is the Director of Research, Sea Empowerment Research Centre located at Amuwo-Odofin, Lagos State.

Photo: Dr. Eugene Nweke.

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