Stakeholders woke up last week to the news that the Comptroller-General of Customs (CGC), Col. Hameed Ali (rtd.) has ordered that henceforth all cargoes coming into the country will now undergo 100% physical examination at all seaports across the country.
It will be recalled that Ali had in his chat with newsmen during his recent visit to Lagos a fortnight ago said that the customs management was withdrawing the fast track facility used by some perceived honest traders who are majorly manufacturers to exit their goods out of the ports with examination conducted subsequently by the customs officers at their warehouses so as not to delay their production process.
The Customs boss decision to withdraw the fast track facility and commence 100% physical examination of imports into the country was informed by the fact that a fast track beneficiary, D.T Host Limited, had brought in brand new car tyres, but falsely manifested it as paper board and machinery. Paper Board and machineries are regarded as raw materials for production and are qualified for fast track goods.
The customs boss who was surprise at the high level of malpractices, by way of false declaration, despite his warnings to importers, agents and customs officers said, “Enough is enough, we are ready to fight corruption to its standstill”.
Annoyed by this discovery, Col. Ali has mandated that all containers must go through physical examination saying that with this scenario, the NCS could no longer repose confidence on importers and traders who are on fast track.
He also said that henceforth all goods falsely declared would be seized warning that any officer who raised Demand Notice (DN) for falsely declared goods would go in for it even as warned all agents, that any infractions committed by their importers, they would go in for it, as they act as lawyers to their clients.
The customs boss must have made this comment and left the scene without knowing the effect of his comments on the stakeholders who had since then expressed divergent opinion on the matter with majority of them showing discontentment with the way and manner the CGC marshaled out that directive.
This medium sampled the opinion of the stakeholders in the industry on the pronouncement of the Comptroller-General and the responses coming from them indicated that Hameed Ali may have been misinformed or that he failed to listen to advice.
According to the former National President, National Association of Government Approved Freight Forwarders (NAGAFF), Dr. Eugene Nweke, the Customs CG was not aware of the message he had sent to the international community even as he said that the comment was capable of compelling the shipping lines and carriers to inflate certain charges since they were aware that obviously, there was a system failure that had that capacity to create the ripple effect of congestion at the nation’s seaports.
Nweke recalled that Nigerians went through 100% physical examination before now wondering if the CGC had undertaken a study of the ocean freight before coming out to make such comment adding that there are things one holding a position of authority need not say especially as a result of one abuse even as he said that on the event of any abuse, such abuse should be rectified before such a person coming out to make statements.
“What that man has done with due respect to my good friend, Hameed Ali, the man has succeeded in saying that customs modernization effort is a failure in quantum, that you have spent money to develop a system that has the capacity to profile a particular importer through a fast lane system to know what is what, that defect should have been detected between the PAAR ruling centre at the point of declaration and the audit system before you bring the cargo or give trigger to whosoever that will take it because there must be a declaration to that effect.
“Is this the first time it is happening? So, coming out to make that statement that henceforth, every cargo coming to Nigeria will undergo 100% physical examination is telling the world that trade facilitation is not possible in the world. Who said so? Who are the officers who go to examine at the warehouse of the importer? Have you call them to probe them? What disciplinary measures have you meted out to them? Because somebody has been assigned to go and carry out examination at the importers warehouse, 10 have gone before and the remaining ones were still inside the ports and you now had information about this and you came. What of the others that have gone?
“So, the system needs to be probed with the intent of correcting the system but not to make statements that you are stopping fast lane. So, condemning the whole system by that statement to me is a misnomer with due respects to my good friend the CG of Customs, Col. Hameed Ali”, Nweke said.
On falsely declared goods, the former NAGAFF boss opined that instead of outright seizure of such goods as posited by Ali, defaulting importer would be made to pay a penalty fee, 100% examination conducted on such good and the real value still be paid by the defaulting importer rather than outrightly seizing the good.
“What you need to do is simple, there are offenses that will require you to sanction by way of penalty. You can’t just say you will seize international traded, after you seize, you still go ahead and auction, how many will you auction? If you discover that he has made a false declaration, you say pay N250, 000 for example before attending to the goods. At the end of the day, you pay that N250, 000, the real examination conducted and the real value will be paid. That is trade facilitation. If you seize the goods, the same importer will go all over and still commit the same crime, this is general and of course, another thing is integrity and trust”, he stated.
On his part, the Managing Director of Wealthy Honey Investment Limited, Dr. Kayode Farinto described the CGC’s decision on fast track as being too hasty even as he argued that one need not throw away the baby with the bath water.
Farinto maintained that in international trade, there were bound to people who declared honestly and those with sinister motive or those he referred to as the non-conformists querying whether the customs would because of the non-conformists who he said were very negligible in percentage punish the honest ones.
He queried,” How can you conduct 100% physical examination which we have left behind about three years ago even when Dikko was the CG? It was because of the delay and congestion at the ports that he introduced what is fast lane for importers of raw material. It was because of that we have scanners to scan some of the containers. Virtually all the scanners at the ports are not working and you want to subject consignments to 100% physical examination, who pays the bills on the demurrages.
“He is the CGC but let him come and implement it himself, let him come and conduct 100% physical examination in one terminal and he will see what the officers are going through and for crying out loud, you cannot just seize my goods. There are some infractions which is not intentional in the sense that there some goods that fall within the borderline which the importer wrongly applied without any intention to cheat, you now seize such goods in this country when we are not foreigners? It won’t work.
“I just want to say that the CG’s position is his personal opinion. I am very sure he has not consulted widely because if he has consulted widely, he will be advised against that. What the CGC should have done is to call a stakeholders’ meeting and say, this is what we witnessed and we will advise him. Since he became the CG, he has never for one day call any stakeholders’ meeting except the last one he did when he took over office about eight months ago. Where is that one done? This is maritime industry, it takes two to tango, customs cannot midwife its duty without the collaboration of stakeholders.
“The last Customs administration talked about collaboration with the stakeholders and this present one has jettisoned that, issuing out decrees as if we are in the barracks. I want to believe that the CG was misguided or he has goofed because you cannot do a hundred percent physical examination on all consignment at the ports especially when we don’t have the wherewithal.
“And fast track is for people who bring in raw materials so that they cannot pay heavy demurrage. Manufacturers are very powerful people, he has to withdraw that statement because they will take him to the Presidency and if the Presidency refuses them, they will take their consignments to the ports of the neighbouring countries. Who loses? These consignments will find their way into the country whether you like it or not. Is it not these our borders that are so porou? It is very unfortunate that they did not advise him well or that he did not listen to advice because cutting off the head is not the solution to headache”.
But on the contrary, the Chairman of NAGAFF, Apapa Chapter, Dr. Fred Ajuzie described the action of the CGC as a welcomed development saying that what Ali did was to reinforce the customs law as embodied in the Customs and Excise Management Act (CEMA).
According to Ajuzie, wrong declaration of imports attracts outright seizure of the imported good as penalty.
On why customs chose to issue DN rather adhering strictly to its law since it was embodied therein, he replied,” Because there was an understanding and an internal memo to that effect from the customs headquarters. Now, when this administration came onboard, they needed revenue because they are moving away from oil revenue trying to source for revenue from other ends and maritime sector is part of the areas they want to focus more attention so that the country can gain more revenue. Probably, many people are not going by the rule, the customs helmsman decided to make sure that that law is enforced and implemented the way it should be and that was why the statement came”.
Ajuzie however said that his position was not that customs should seize goods wrongly declared by an honest importer who had no intention of cheating government as according to him,” Customs officers are human beings, any error made mistakenly, although that is not an excuse in the face of the law, but there are permissible mistakes. Not that you carry a full load of consignment and you wrongly declare it, it cannot be unintentional declaration. But if you carry come mixed items and some of them are classified wrongly, it is understable because there are some items their classification looks alike”.
“Yes! I am an advocate of the closure of fast track because customs have discovered that the government is losing a lot of revenue through fast track and we have to help government plug loopholes in the revenue generation. It is a welcomed development but they are only spoiling business for those who are genuine”, he said.
Different strokes for different folks you will say. From the foregoing, it is evident that the decision of the Comptroller-General of Customs did not go down well with some stakeholders and this call for a second look at that position by the Nigeria Customs Service with input from stakeholders on the best way forward.
Whichever way one looks at it, it is the Nigerian economy and Nigerians that are on trial here as any economic policy made especially in this period of economic recession in the country, will have its impact on the economy of the nation as well as on its citizen hence the need for government policy formulators to consult widely and wisely so as not to further plunge the nation further into the deep mud of recession. All policy should be geared towards internationally accepted best practices as Nigeria cannot work in isolation.
Importers and their agents on their own should be honest and not abuse privileges given to them so as to help them reduce cost of doing business in the country and not bring ill-luck to some honest traders who play and are ready to play by the rule any day, any time. That way, they could help shore up the economy of this nation which has since lost its leading role in Africa and ensure that the dream of the government in making the Nigerian ports hub for the West and Central Africa is realizable.
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