The Customs e-auction is an apparent failure

For decades, the Nigeria Customs Service used the most unorthodox way to dispose of seized and overtime cargoes. It used its own discretion to decide who got what and for how much. The service also used government licensed auctioneers.

No doubt, that  system allowed for favouritism and prejudices, we heard of Controllers of strategic commands where seizures are made using such as patronages for traditional rulers, friends, politicians and so on.

Under the previous arrangement, once a cargo has been certified and gazetted after seizures or after having stayed in the ports or border  commands’ warehouse above the stipulated period (which is three months or 90 days), it is liable for auction and the Customs headship decided what to do, including who to sell to and how to sell it. The process is long and tedious, the courts are also involved. The goods must be gazetted before they can be sold.

Once the process of gazetting is completed, Customs sometimes (under some special arrangement) allowed the owners of such goods the right of first refusal, that is, to buy such goods before any other person. Customs at a time did also use registered auctioneers to sell the cargoes.

However, the most common approach often used by Customs was to allocate the auction papers directly to whoever they liked.

All taken, the ageless method of Customs cargo auction was open to abuse. It lacked any modicum of transparency. It allowed the top hierarchy of the Nigeria Customs Service to use the exercise to ‘reach out’ to their friends. The process was always used to settle politicians, political leaders, traditional rulers and other friends of the service. Of course, senior officers of the service also benefitted directly.

But this year, Customs announced that it was jettisoning the old idea of ‘manual auctioning’ of seized goods, it added that, with effect from July 1, the novel electronic auction method would start.

While justifying the new method, the Public Relations Officer of the Nigeria Customs Service; Deputy Comptroller Joseph Attah had said that the new system it was simply to bring sanity and transparency into the process of Customs auction exercise. “The auction exercises will be electronically driven. So when we say e-auction platform, (we mean) a platform in our trade portal that gives opportunity to all interested people to see what they want with a full description of its present state”, he said during one of his media interactions.

He affirmed that the Comptroller General of Customs, Col. Hameed Ibrahim Ali (rtd) introduced the process as a way of enhancing transparency, reducing human contacts and ensuring that only the highest bidders for any auctioned item takes it.

With the processes that have been put in place, it is most likely going to be a departure from the old method.  

Under the guidelines, auctioned items cannot be replaced or funds paid refunded to the bidders. Successful bidders are expected to make payments within five working days as auctioned items whose winners fail to pay within the period would forfeit the auctioned item to the second highest bidder.

The demand for Tax Identification Number (TIN), the disqualification of customs officers and their families from participating in the bidding process either directly or indirectly, is quite commendable.

Sadly, the fears that were expressed at the onset of the exercise is coming to reality. The most trending fear that was expressed had to do with the activities of internet fraudsters who are most likely gearing up to hack into the portal to defraud unsuspecting buyers. Another fear is the likely collusion by Customs officers who will be in charge of the process. 

No one even thought that the Nigeria Customs Service would midway lose capability for the e-auction, so much so that the various commands are now filled with thousands of seized but not auctioned vehicles. Some of these vehicles have stayed for more than two years, some are already scraps.

When the system started, many Nigerians had cried out that they couldn’t access the Customs e-auction portal. Some banks were exempted for flimsy reasons such as their non-cooperation. 

Even though Customs boasted that the e-auction portal was fully networked to designated banks to facilitate easy access, it was found to be a difficult task logging in.

A system that excluded customers of  leading commercial banks, but gave unfettered access to customers of banks that are not only new but whose customer base is in a particular section of the country or whose customers are of a particular religious faith  can not but be accused.

We are not impressed or persuaded by the reasons alluded to by the Public Relations Officer of the Service, that the process of condemning  and forfeiting the seizures through the Court is long and therefore responsible for the apparent abandonment of the e-auction.

It has taken the Customs months after the last auction, in fact after the first experiment was puplicised; it has only carried out one or two more auctions, even though it claimed that it is weekly exercise.

Curiously, after the initial figures of N272,115,366 from the auction of 646 vehicles under  the supposedly novel e-auction, the Service has remained silent.

While the service is battling with the failure that the electronic auction has become, multi-billion Naira vehicles are wasting away under the sun and rain. Many of these vehicles are now scraps that are no longer worth their value.