23 November 2015, Lagos – Nigerian Shippers’ Council, NSC has faulted mounting opposition against the International cargo tracking note CTN, accusing the Shipping Association of Nigeria (SAN), the umbrella body for almost all shipping lines operating in Nigeria, of distorting facts regarding the International Cargo Tracking Note.
According to the Executive Secretary of the Nigerian Shippers’Council, Mr. Hassan Bello, ICTN is a global advanced cargo information system on all imports and exports adding that Nigeria is one of the few countries that is yet to implement it even though Nigerian importers are unknowingly paying for it as shipping companies operating in Nigeria charge ICTN fees.
Bello said that the shipping agencies are only creating disaffection among stakeholders, especially the organised private sector by promoting falsehood that ICTN will add to the cost of doing business. He explained that before approving the ICTN, the Federal Government had seen the enormous revenue leakages that were going on, both in the importation of dry cargoes and the exportation of wet cargoes. Bello said apart from blocking revenue leakages, the ICTN is also needed for security reasons.
Countering the argument of SAN concerning who bears the administrative cost of ICTN, the Council boss said that the ICTN does not come with additional cost to importers or exporters, rather the administrative cost is to be paid by the shipping lines, whom he said had for long inputted the cost in the bills they give to consignees in Nigeria.
“The shipping lines have been billing importers and exporters for it, and they do not want to let go, they have been hiding such cost on the final bills given to Nigerian importers to pay,” he added. SAN had last week issued a public notice in which it raised alarm that, the “implementation of International Cargo Tracking Note (ICTN) by the Nigerian Shippers Council will entail an additional cost for importers in Nigeria.”
But the Shippers’ Council reacted sharply by accusing SAN of deliberately deceiving Nigerians and mischievously pitching importers against the government. The ICTN, Bello said, is already part of payments that are already being made by importers to the shipping lines or the carrier.
According to the Council, “Whether the Shippers’ Council introduces cargo tracking note or not, shipping companies will continue to collect this taxation, the $25 per container and all the other listings are expected to come from the already existing freight taxation collected by the shipping lines on Nigerian freight.
The ICTN comes with payments that are already collected or payable per consignment, it is already included as part of the consignee’s payments.” He accused the shipping lines of forming a cartel and taking advantage of many West and Central African nations. “They are trying to truncate the ICTN because they are the same shipping companies dealing with all the 18 countries in West and Central Africa implementing cargo tracking note,” he added.
According to the Shippers’ Council boss, the administrative cost of implementing the ICTN in Nigeria is very low compared to what is paid in other West and Central African countries. He disclosed that, in some West and Central African nation, they collect as much as 65Euro per TEU, while the lowest cost is 35Euros.
“The ICTN in Nigeria is different from those being implemented in West and Central Africa, ours is Advanced Cargo Declaration that gives you a column where you must put the BAF (Bunker Adjustment Factor) CAF (Currency Adjustment Factor) you must tell us what the surcharge is -whether it is GRI (General Rate Increase) which shipping companies do from time to time and they hide it, when you go for a shipping invoice they will give you a lump sum, it doesn’t tell you what the GRI or what the basic freight is.
“Here in Nigeria, we are charging $25 per TEU, which is less than a quarter of the 65Euros charged by other countries, but they are not worried about that because they know that Nigeria controls 75 per cent of the cargoes,” he stated.
According to the Council, under the ICTN, containers attract a fee of $25 per unit, Roro vehicles, $10 per unit, break bulk cargoes attract $0.2 per unit, while conventional/groupage cargo attracts a fee of $1 per freight ton. Similarly, while crude oil export attracts $0.1 per ton, both empty containers and non-crude oil exports attract no fee.
The Council maintained that, the shipping lines and agents are trying to kick against the implementation of ICTN because they are aware that it will address wastages in the system and create choices for the shipper. In a sharp reaction against the introduction of the CTN, the Chairman of Shipping Association of Nigeria, Mr. Val Usifo told Vanguard that the issue of CTN is not an association matter adding that it is an issue that will affect international business.
“This is not an association matter, this is an issue that affects international trade,” Usifo said. However there were mixed reaction by various maritime stakeholders over the introduction of the Cargo Tracking Note. While some who are in support of the programme are saying that it will bring about a more secured port environment, others are of the opinion that it will bring additional cost.
In a statement, a cargo logistics expert, Mr. Lucky Amiwero said that the Nigerian Shippers’ Council is not empowered by law to midwife the CTN. He said that it is only the Ministry of Finance that is legally empowered to implement the CTN. Presidency sources told Vanguard that the CTN was approved by the Goodluck Jonathan administration two minutes to the end of its tenure, (the document approving the introduction of CTN was signed by former President Jonathan at 11: 58 on the 28 of May 2015).
According to Amiwero, the negative impacts generated by the introduction of International Cargo Tracking Note (CTN) necessitated the need for the cancellation as directed by the President and Commander-in-chief in 2011. On the legal front, Amiwero said that the introduction of ICTN to Nigeria imports requires an existing legislation by the agency involved, to carry out the implementation with regards to charges and international process, which is not contained in the statues that established the agency.
He also explained that the introduction of the ICTN by the NSC is against the international convention of the of the World Customs Organization on Advance Cargo Information (ACI). “The Advance Cargo Information(ACI) is Pre-arrival or advance information process that is a security tool covered under the World Customs Organisation (WCO) Safe framework of Standards to Secure and Facilitate Global Trade.
Advance Cargo Information/ advance electronic information requirements is a Customs security control process, which allows the use of control data aim to assist Customs to make the best use of an improve timeframe to carry out risk assessment routines well ahead of the arrival of consignments.
“Advanced electronic information is covered under standard 6 of the WCO Safe Frame Work of standard to secure and facilitate trade,” he added On the multiplicity of cost on import and the impact on the economy, Amiwero said that the pre- shipment and other cost on Nigeria import e.g. 1% Fee on Board, FOB, SONCAP fee and ICTN etc covered under various levies and charges are not statutorily covered or in most cases not tied to service, which contravenes World Trade Organisation (WTO) Articles VIII (Fees and Formalities Connected with importation and Exportation.
The provision clearly states that any amount charged on import and export must approximate cost of service rendered. He opined that the multiplicity of cost on our import and export has serious negative impact on manufactured products and the attraction of Foreign Direct Investment (FDI), which affects product competiveness globally and high port cost within the sub region that makes our port unattractive.
Similarly, National President of the Association of Nigeria Licensed Customs Agents, ANLCA, Prince Olayiwola Shittu, told Vanguard that they are in support of the ICTN because the NSC had promised that it will not increase the cost of transaction and that it will actually result in the reduction of the cost of transaction.
According to Shittu, “We are holding Shippers Council to their pledge that the ICTN will not add to the cost of transaction. The only thing that attracted us there is the ability of the ICTN to checkmate under-declaration by shippers and then claim not to have what they have including value because once you declare over there you cannot turn it up-side-down when you get here.
“If Customs works with ICTN, it means that we can now do proper declaration, importer pays his duty and nobody goes to meet you to extract money. That is the area that we see that it will add value to our operation, we are tired of all these settlement and corruption. “If it is true that the liners have already correcting these money then it is okay, we will wait and see. Forget about these shipping agents speaking from both sides of the mouth. We know there are some charges that they are giving us per ton that we cannot even explain what it stands for.
“How can you say there is a penalty for going to Nigeria, for God’s sake, what about countries like Somalia? Ships are still going there now. They are taking us for granted and eating the money. You know there is a cartel, once they come together they agree and hold us to ransom but it is our duty to expose them, let Shippers Council go ahead, all those illegal charges by the shipping lines will be dropped, he stated.
Duty National President of the National Council of Managing Directors of Licensed Customs Agents, NCMDLCA, Uchu Block, said that it was introduced some years back and was cancelled by government because it was not adding any value. Block said that the ICTN is not needed because even as a security documents as claimed, all the information that will be generated by the ICTN are already being generated from the Pre-Arrival Assessment Report, PAAR, which is being operated by the Nigeria Customs Service, NCS.
“I do not think we have need for it because it will increase the cost of business in the port even though the NSC says that there will not be extra charges for the consignee, I do not believe that. Even if they push the charges to shipping lines and their agents, it will finally be shift to the consignee because there is no free meal in Freetown,” he concluded.
It will be recalled that operators in the real sector of the economy, consisting mainly members of the Manufacturers Association of Nigeria (MAN), National Association of Chambers of Commerce, Industries Mines and Agriculture (NACCIMA) and the Lagos Chamber of Commerce and Industries (LCCI) have all been opposed to the introduction of the ITCN all locked in a fierce battle with the government, represented by the Nigerian Ports Authority (NPA) over the recently introduced Cargo Tracking Note (CTN) charges at the ports.