Home Maritime Give Shippers’ Council legislative powers to effectively oversight, regulate the operation at the ports—CPPE

Give Shippers’ Council legislative powers to effectively oversight, regulate the operation at the ports—CPPE

by Business News Report

Centre for the Promotion of Private Enterprise CPPE, has urged the federal government to give Shippers’s Council the necessary powers to regulate activities at the nation’s ports. It said that the absence of an effective regulator is affecting the international trade facilitation process in the country. The non governmental organisation in its half year economic review said “the port ecosystem requires an effective regulator with full legislative powers. Therefore, we request that in order to protect the interest of all the stakeholders in the international trade processes, particularly in the cargo clearing ecosystem, the port regulator needs to be adequately strengthened, empowered and given a commensurate authority backed by legislation that will match the enormity of the regulatory responsibilities. We therefore request the National Assembly and the President of the country to expedite the process of giving the Shippers’ Council the enabling legislative powers to effectively oversight and regulate the operation at the ports. This will ensure that the interest of all the stakeholders in the ports are duly protected.

“Port users are still grappling with high cost of operations, the tedious procedures, documentation, weak application of technology and extortion. Scanners are yet to be fully operational at the ports, the single window is yet to take off and weigh bridges are not in existence at the ports.  This is not a good commentary for the ports in the largest economy on the African continent. These issues have become intractable and we appeal to the authorities to look urgently into the plight of port users. The port is a very critical part of this economy. The port is the gateway for import and export and therefore very critical to the prosperity of the Nigerian economy. We acknowledge the need for all operators at the ports to abide by the terms and agreement of their operation including the financial obligations. We recognise the need to enforce compliance with such obligations. However, this should be done in a way that would not impact negatively on innocent stakeholders at the ports. We therefore request that in imposing sanctions on terminal operators or other agencies at the ports, innovative ways should be adopted to avoid collateral negative effect on other stakeholders particularly the importers and the exporters. There are instances where consignments on which duties have been paid and cleared, have been trapped in terminals that have been sealed. The Nigerian Customs Service should therefore review its strategy on sanctions imposition to avoid disruptions of businesses of innocent economic players. 

“The activities in our maritime sector are 24-hour activities. Therefore, it is imperative for all agencies working at the ports to have operating hours that accommodates the nature and character of the port’s ecosystem. Therefore, both the shipping companies and the terminal operators should operate working hours that reflect the character of the industry in order not to impose unnecessary hardship on importers and other players in the sector. The current practice for instance is that shipping companies open at 9 am and close at 4 pm, and in-between they observe a one-hour break. Some of the off-dock terminals do not open until 11 am. Some terminals don’t even work on weekends. This practice is inimical to the operations of business and the smooth processes of international trade. Additionally, some of the major terminals do not issue Terminal Delivery Notes (TDO) after 4 pm.  All of these operating hours are not compatible with an efficient value delivery to importers and exporters.  They are not customer friendly.  Many of the terminals and operators do not have electronic payment platforms that allow for efficient transactions with their institutions. 

“The working hours at the cargo terminals of the Nation’s international airports are completely at variance with the demands of the investors, who ought to be treated as customers.  The airport operates twenty – four hours, some agencies of government like the immigration and Customs, Plant Quarantine operatives also operate twenty – four hours. It is therefore inappropriate for the operatives of the airport cargo terminals to have operating hours that are not business friendly. From information, the airport cargo terminals open at 10 am and close at 4 pm, and in-between they observe a one-hour break.  This is essentially operating for just five hours a day. On Saturdays they operate between 10 am and 12:30 pm. Essentially, it is as though these very critical agencies of government work for only five-hour a day and only for about two-hours on Saturday. For an agency that is supposed to support international trade which is a 24 hours business transaction, the operating hours should be reviewed. The dispute resolution system between importers and the agencies of Customs including the Customs, terminal operators and shipping companies is not effective and therefore hurting investors in the economy. In many cases what we have as a dispute resolution committee where the accuser is also the judge.  There is therefore a need for an independent appeal framework for resolution of disputes in the international trade ecosystem. This is to ensure fairness and equity in the way disputes are resolved. Current appeal committees are populated by operatives of the very agencies against which the appeals are being lodged. This cannot serve the end of justice and a credible outcome.

In spite of the efforts of government over the years to put an end to the disruption of cargoes that have been duly cleared and released at the ports, the problem has persisted. We recall the Presidential Executive order on ease of doing business which stipulates that there should be no disruptions of movement of cleared cargoes within the vicinity of our ports. This has not been complied with. Importers still have to grapple with disruption of movement of their consignments by security agencies especially the FOU, the CG Strike Force and CG Border Drill.  We call on government to put an end to the disruptions of the movement of cargoes that have been duly cleared by government agencies within the ports.  This is against the spirit of the Ease of Doing Business and it is negatively impacting the confidence of investors. The experience is that of overlapping examination of cargo, additional time and additional expenses, thus escalating the cost of doing business. The revenue generation objectives of the Customs have taken precedence over trade facilitation. This is certainly not good for the economy and not good for the commitment of government to create jobs. It is not investment friendly and we urge the relevant authorities to accord the proper priority to issues of trade facilitation for the benefit of the economy, investment growth and employment generation. 

“Many importers have been encountering serious challenges with recovery of container deposits from the shipping companies. This is a matter that requires urgent intervention by the relevant authorities. Refunds takes between five to eight months and the cumulative container deposits outstanding are quite staggering. There is a need for the shipping companies to improve on the refund of container deposits. They should also facilitate the delivery of empty containers to them. The current approach of demanding that containers be taken directly into the ports is creating a lot of challenges for importers. Therefore, we demand that the shipping companies should comply with earlier directives of government that they should have a holding bay outside the ports for the delivery of empty containers. This will reduce the time it takes to return empty containers, reduce the demurrage that importers pay both for the containers and for the trucks that convey these empty containers. It will also reduce the problem of congestion at the ports because many of the trucks that are heading to the ports are carrying empty containers which creates a lot congestion and logistics problem within the ports. 

“Monopoly powers tends to adversely affect the growth of the economy and undermines the objective of building an inclusive economy. It also increases opportunities for consumer exploitation. Therefore, there is a need for the relevant authorities especially the Shippers’ Council and the Federal Competition Commission to ensure that all the monopolistic tendencies in the maritime sector, particularly the shipping companies and the terminal operators should be contained. Monopoly structures require strong regulatory oversight in order to protect all the stakeholders in the economy and particularly in the international trade ecosystem. We need a robust framework to prevent these monopolistic tendencies. These tendencies are inimical to competitive practices and also poses a major risk to the survival of small businesses in the maritime and port ecosystem. The Shippers ‘Council and the Federal Competition Commission should curb this growing trend and tendencies in order to ensure that there is an inclusive framework for all operators in the sector and to also reduce the vulnerability of the system to undue exploitation and crowding out of SMEs in the sector”.

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