It is now a few months to the expiration of the contract for destination inspection which involved the use of service providers. The scheme was introduced as a method to be adopted for ascertaining certain factors regarding imports into Nigeria. The task was given to three companies, that is, Cotecna, Global Scan and SGS.
It is now a few months to the expiration of the contract for destination inspection which involved the use of service providers. The scheme was introduced as a method to be adopted for ascertaining certain factors regarding imports into Nigeria. The task was given to three companies, that is, Cotecna, Global Scan and SGS.
The nation’s entry points (including air, sea and land) were farmed out such that Cotecna was given Lagos seaports, Jibya and Banki land borders in Katsina and Borno states respectively. SGS won the contract to inspect imports coming into the country through Onne port (Rivers state), Idiroko land border (Ogun state) and Port Harcourt airport. Lastly, Global Scan got the deal for Warri and Calabar seaports, Seme land border in Lagos state and Lagos airport.
The idea of the scheme called destination inspection of imports was first mooted in 2001, with July of the same year fixed as its commencement date, but that was not to be as the federal government through the then- minister of finance, Dr Ngozi Okonjo-Iweala announced a new take-off date of 2004.
Cotecna was given the contract for destination of all imports into Nigeria; a development which was resisted by some interest groups. This delayed the take-off date.
But on account of the myriads of disagreements and opposition to Cotecna’s exclusive contract, government eventually agreed to split the deal among the three destination inspection agents, hence, the commencement on January 1, 2006.
Certainly, expectations have been very high as to whether or not the scheme could correct the shortcomings of many years of pre-shipment inspection of imports, which we are told, was fraught with many problems such as: discrepancies in value, quantity and delay in issuance of the all-important Clean Report of Inspection (CRI) by the pre-shipment inspection agents. There were also allegations of discovery of large-scale importation of prohibited items upon physical examinations by the Nigeria Customs Service personnel.
Its alternative, that is, the Destination Inspection scheme is hinged on two principles, which are: risk profiling and scanning. Upon its introduction in 2006, government had stated that it was dropping pre-shipment inspection system in order to enhance trade facilitation, protect the nation’s security and increase customs revenue collection capability.
Opinions may be divided as to the extent to which these objectives are being met, but we are sure of certain facts. One is that the revenue profile of the Customs has been on the rise since the scheme was flagged-off, so also has the incidence of interception of contraband been on the rise.
From available statistics and having watched the system operate for almost six years, we are sure that the nation’s ‘gateways’ have been playing hosts to prohibited items since 2006. The daily reports of seizures by the various commands and the federal operations units (FOU) of the Nigeria Customs Service are confirmation that importers still circumvent the rules. The nation has been moving steadily towards achieving the objectives of embracing the scheme.
We recall that a few months after destination inspection came on stream, the then-Comptroller General of Customs, Alhaji Hamman Bello Ahmed, at a meeting with the Manufacturers Association of Nigeria (MAN) alluded that many years of pre-shipment inspection had eroded the capability of Customs to perform its statutory roles which include collection of revenue accruable from imports through accurate valuation and classification.
We are convinced that since 2006 when destination inspection came up, the Nigeria Customs Service has become more professional.
If Nigeria were to hold on to pre-shipment inspection, we doubt if the Customs will today be talking of Automated System for Customs Data (ASYCUDA), Direct Traders Input (DTI), e- payment method, fast track and other innovations which the customs import duty collection process has witnessed.
Perhaps, the greatest challenge to destination inspection remains the quest to clear cargo within 48 hours of arrival in the ports. It is the need to achieve this that has given rise to DTI, fast track, e-payment and other innovations that the nation’s cargo clearance procedure has witnessed in the last couple of years.
But, the successes that have so far been recorded wouldn’t have been without the professionalism that the three destination inspection agents have brought to bear on their assignment.
We may not yet have a perfect and iron-cast system, but the average importer or freight forwarder will agree that the abuses to which cargo clearance was being subjected to have largely reduced. Incidences of under declaration, falsification, concealment and outright abuses of the system have been on the decline.
As much as we agree that the service providers have done well in the execution of the contract, we are saddened by what is now coming to the fore and which indicates that the three destination inspection agents are reluctant to leave at the expiration of the contract in December 2013.
At the commencement of their contract in 2006, the terms were clearly spelt out to include the fact that they would operate and transfer on December 31, 2012.
There is no justification for the submission of the service providers that the Nigeria Customs Service is not ready to take over, it is certainly not part of the contract that the service providers should appraise the preparedness of the Nigeria Custom Service.
We think that the decision to either extend or terminate the contract of the three service providers should not be based on the ongoing lobbying and the sentiments that are being raised by the agencies, rather, the federal government through the minister of finance should objectively weigh the options.
Most importantly, we are strongly of the opinion that, if Nigeria desires a Customs service that is equal to the task of trade facilitation without losing sight of the essentials of revenue collection, then the time is ripe to hand the whole process of cargo inspection and all that has to do with it over to the Nigeria Customs Service.
We are aware that many officers of the Nigeria Customs Service have been trained by the service providers, so the argument about Customs officers readiness is unacceptable.
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