There are strong indications that the much- expected review of the Coastal and Inland Shipping Ac t (otherwise, called Cabotage Act) is to commence in earnest. The House of Representatives has fixed June 26, 2012 for the public hearing.
The review of the nine –year old law has been going on quietly in the lower chamber for some months and in fact, the amendment has been gazetted at the lower chamber. It has also scaled through the statutory first and second reading.
There are strong indications that the much- expected review of the Coastal and Inland Shipping Ac t (otherwise, called Cabotage Act) is to commence in earnest. The House of Representatives has fixed June 26, 2012 for the public hearing.
The review of the nine –year old law has been going on quietly in the lower chamber for some months and in fact, the amendment has been gazetted at the lower chamber. It has also scaled through the statutory first and second reading.
Jointly sponsored by the deputy speaker of the House of Representatives, Hon Emeka Ihedioha and the chairman of the House Committee on Marine Transport, Hon Ifeanyi Ugwanyi, the amendment is aimed at expanding the jurisdiction of the Act to cover all vessels in oil and gas exploration and exploitation activities on or under water as well as all forms of transhipment activities within Nigeria’s domestic waters.
But a member of the House committee on marine transport who pleaded anonymity confirmed to Shipping Position Daily last week that “there are six items that require legislative intervention, out of the 13 or 14 aspects that have been found to be defective or require intervention”.
He identified one of the aspects that require legislative action as the Seafarers Identity Document (SID), adding that the executive is expected to forward the document to the National Assembly.
Out of these, six it’s only about two or three that require direct amendment, he disclosed, even as he added that, “for instance, the fishing trawlers owners believe that they should be removed from Cabotage”.
One major aspect is the issue of jurisdiction as it relates to offshore platforms that were not captured by the Act, whereas in the United States Jones Act which Nigeria copied, operations of offshore platform come under the Jones Act.
Our source disclosed that the lawmakers have sufficient facts to the effect that the Cabotage Act has left out key areas where offshore operations are increasingly going on and where Nigerians have been largely shut out.
According to him, stakeholders have been expressing concern about issues like the Cabotage Vessel Financing Fund (CVFF) and the waiver clause. These are issues that require administrative attention from the executive and once that is done, the National Assembly knows what to do.
Although it was received with great enthusiasm, industry stakeholders have lamented that the law is still deficient and impossible to implement in favour of local companies. One key area they fingered as the problem is the exclusion from jurisdiction of several offshore operations in the Oil and Gas sector as prescribed in the Act.
A portion of the draft bill which was sighted by our correspondent last week confirms where the law makers are headed. Specifically, part II of the amendment to the Act prescribed in the clause titled: ‘Restricting of Vessels in Domestic Coastal Trade’, that: “A vessel other than a vessel wholly owned and manned by a Nigerian citizen, built and registered in Nigeria shall not engage in the domestic coastal carriage or cargo and passengers within the coastal, territorial, inland waters, island or any point within the waters of the Exclusive Economic Zone of Nigeria”.
It also adds in clause 4(1) that: “A tug or vessel not wholly owned by a person who is a Nigerian citizen shall not tow any vessel from or to any port or point in Nigerian Waters, or tow any vessel carrying any substance whatsoever, whether of value or not or any dredge material whether or not has commercial value from a port or point within Nigerian waters”.
Shipping Position Daily recalls that, while leading debate on the general principles of the amendment bill, chairman of the A House of Representatives committee on marine transport, Hon Ugwanyi had pointed out that, “as legislators, we have a duty to contribute our own to the success of the Cabotage Act in order to bring it in line with other international jurisdictions. The Amendment sought will expand jurisdiction to cover all vessels in oil and gas exploration and exploitation activities on or under water, as well as forms of trans-shipment activities within our domestic waters reflecting the trend of our nation’s oil and gas operations”.
He had told his colleagues that Nigerian stood to reap financial benefits from a well-articulated and implemented Cabotage. One of the ways to generate a substantial chunk of the nation’s revenue is through participation of Nigerians in the huge shipping and logistics services in the oil and gas sector as statistics show that average cargo traffic of 152 million metric tons worth $5billion is generated in freight earnings annually.
“As at today, over 90 percent of this income is earned by foreign shipping companies who deny employment opportunities to our seafarers and refuse to make use of our local ship and refuse to invest in local maritime infrastructure development”, he stressed.
Expected at the public hearing are stakeholders in the Nigerian maritime as well as oil and gas sectors of the economy.
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