The hope of some terminal operators to get their concession agreement renewed has been dashed as findings by Shipping Position Daily have revealed that the Minister of Transportation; Alhaji Muazu Jaaji Sambo failed to present the documents for the renewal before the Federal Executive Council (FEC) during the last meeting held on Wednesday last week.
Our correspondent gathered that the Minister failed to present the document before the FEC., owing to the alleged failure of the Nigerian Ports Authority (NPA) and the Nigerian Shippers’ Council (NSC) to agree on modalities for the performance audit on the terminal operators before the meeting.
A source close to the Minister who pleaded anonymity said the Minister had frowned at both NPA and NSC over the failure of both agencies to work together on the documents .The source quoted the Minister as saying: “I can’t go and rubbish myself before the FEC, if they have failed to do the right thing, it is for them to be blamed”.
The source further said even though the Minister was eager to get the concession renewed, the two agencies failed to work together in working on the port concession agreement documents.
Recall that the Minister had earlier submitted the documents for the renewal of concession of the terminal operators whose concession agreements were due for renewal.
The FEC however turned it down, querying the absence of the inputs of the NSC, who is the economic regulator and ordered a review.
The FEC had asked the Minister to return the concession agreement process for the input of the economic regulator and return it after all necessary inputs have been added.
Findings by our correspondent confirmed that the inter-agency rivalry between the two agencies may have cost the terminal operators the failure to get their concession renewed.
Recall that the NSC had no input in the concession renewal of the terminal operators, not until February this year when the Minister said companies seeking renewal of ports concession agreements must show satisfactory evidence of performance in terms of fulfilling the agreements, meeting key performance indicators and other obligations incumbent upon them by the NSC.
Sambo had stated this during an official visit to the Council in Lagos in February this year. He also placed the responsibility of approving ports concession agreements renewal on the Nigerian Shippers’ Council, while charging the agency to be meticulous in the screening process and to drop any company that could not satisfy the conditions for renewal of the agreements.
He had said: “The renewal of the concessions should be based on the performance of the company that was handling it. Get the ports concession agreements that were signed in 2006, identify all the key performance indicators (KPIs) for each terminal that is due for renewal, look at their performance in terms of meeting these KPI’s including development plans, cargo traffic, revenues and other obligations that were incumbent upon them.
“Where a terminal operator’s concession should not be renewed, you must be bold enough to say it should not be renewed because they have not been able to match the target that was set for them and we will look for other companies that will meet the conditions”.
You will also recall that Shipping Position Daily had in March this year reported that the directive by the Minister to the NSC may cause inter-agency rivalry between the NPA and NSC “NPA.
One of the stakeholders who spoke to our correspondent argued that the Minister was turning logic upside down by attempting to drag the Shippers’ Council into an agreement that had been concluded by both the NPA and ICRC.
The source said, while the process of the agreement was at the preliminary stage, the Shippers’ Council was duly represented in the inter-ministerial committee set up by the immediate past Minister of Transportation; Mr Rotimi Amaechi, “to follow everything to the end”.
“Mind you, the inter-ministerial committee set up by Rotimi Amaechi had submitted a report over a year ago, and in that Committee, the Shippers’ Council was represented by Chief Agu and Mrs Ifeoma. So for the current Minister to turn around now to say that the Shippers’ Council was not carried along does not arise, because, one, they were represented, even though, legally speaking, they are not a party to the agreement and they have no part to play in the concession agreement. Their role in the Act setting up Shippers’ Council does not include the role the Minister is giving to them.
“They are not technically equipped to know what NPA or the terminal operators are doing. Their job does not include the role the Minister is giving to them, so whatever the Minister is doing is totally illegal and has no place in law. It is an overkill”, our source said.
However, in his reaction to the directive a maritime lawyer and senior partner; Akabogu and Associates. Dr. Emeka Akabogu stated that the minister’s directive was in order, even as he argued that the NSC is empowered to undertake the responsibility which is being thrust upon it by the minister.
Akabogu said: “The Minister is trying to involve relevant agencies of government who have a mandate with regards to the port operations and the regulations of the port to be involved fully in that process, as opposed to leaving out organisations which actually have a role to play in that process.
“Now you recall that under the NPA Act of 1999, there is provision or contemplations for concessions of the ports and the port environment and that is why there was a push at the time, the concession agreement were being considered for a review of the NPA Act towards the Port and Harbours Act; that initiative did not see the light of the day and even up till now the legal framework upon which the port concession is standing remains nothing more than the contracts between NPA as the landlord and the concessionaires as the operators and the BPE as confirming party”.
“Now in their (NSC) capacity as the Economic Regulator of the port, one of the powers they are conferred with is the power to advise the Federal Government through the Minister on matters relating to port charges, port facilities related matters. It equally empowers them to advise with regards to the provision of the port concession agreement entered into between the NPA, the BPE and the concessionaires and don’t forget, if you look at the regulations it cut across not just of the mandate or operations relating to the port, but with regards to ensuring efficient operations, safe practices, fair trade and overall compliance with competitions and its related requirements within the port environment.
“So the NSC is actually significantly empowered to undertake the responsibility which is being thrust upon it by the Minister and the Minister, in thrusting upon it, that responsibility is not doing it a favour by way of his discretion. He is actually simply getting them to do what they’re empowered to do under the NSC Port Economic Regulations of 2015”.
Explaining further, he said: “I think the Minister’s directive is not for them to review the agreement, but to audit compliance with relevant issues relating to the agreement. So I think largely the Minister is not wrong and I will not agree that the Minister is setting the NPA and NSC at loggerheads”. He had argued.
Checks by our correspondent however confirmed that terminal operators that are not affected by the delay include: Port and Cargo Handling Services at Tin Can Port, ENL at Lagos Port Complex, Josepdam at Tin Can Port, AMS in Warri and the Port and Terminal MultiServices Limited in Lagos.
This is according to documents originating from the Ministry of Transportation and the Infrastructure Concession Regulatory Commission (ICRC) and which were sighted by our correspondent. The concessionaires were said to have complied with all the rules and were duly awarded the appropriate certificates by ICRC, which is the constitutionally mandated agency for that purpose.
It was also confirmed that the renewals were granted as far back as December, 2022. This was further confirmed in a memo from the ICRC, dated December 30, 2022 and referenced ICRC/HQ/P/S.04/266.
The memo reads in part: “The Honourable Minister may wish to note that the Commission had given approval to the Nigerian Ports Authority (NPA) for the renewal of the Terminals Concession through letters referenced ICRC/DG/50/S.52/118 dated September 24, 2021, subject to obtaining all necessary approvals including the Federal Executive Council for ease of reference, and attached copies of the letters.
Confirming its action further, the ICRC said its “approval was given based on the Business Case submitted to the Commission by the NPA and subsequent negotiations held between the Government team (NPA, ICRC, the “Transaction Adviser) and the affected Terminal Operators.”
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