Nigeria Customs Service: Imperative of urgent reforms

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Customs processes and procedures for the clearance of cargo at the ports is one of the biggest challenges currently faced by the business community.  It is severely hurting investors and adversely affecting economic recovery efforts.  The situation calls for urgent intervention and reforms of the Nigerian Customs service. There are issues of undue delays, weak application of technology, arbitrariness in valuation, impunity, uncertainty of international trade transactions, cost escalation, negative investment climate perception, ineffective mode of seeking redress, pervasive human interface, among others. The business community is compelled to interface with too many units of the Nigerian customs service and other government agencies which makes doing business extremely difficult and frustrating.  It also predisposes the system to brazen extortionist practices.

These units include the Pre-Arrival Assessment Report [PAAR] office, Valuation units, Examination, Releasing, Unblocking, DC Report, StampingUnit, Exit Gate, Enforcement, Other government agencies that businesses have to contend with at the ports include NAFDAC, SON, Plant Quarantine, SSS, Police Anti Bomb Squad, and the Port Police.  Outside the ports, importers are confronted with Federal Operations Unit of the customs, Customs Strike Force, and the Customs Police.  Encountersby the private sector with these numerous agencies imposes unbearable burden on importers and investors in terms of costs, time, and the bureaucracy.

There are also recurring issues of valuation of imports and HS Code classification of products. PAAR Issued by customs headquarters are frequently queried by customs operatives at the ports.  Many businesses have suffered severe disruptions in their investment projections because of large variations arising from revision of value and re-classification of imports by the PAAR Office at the Customs headquarters and the Customs units at the ports.  This phenomenon has become persistentand hurting investors.  It has also become a major source of uncertainty for businesses.

The trade facilitation role of the Nigerian Customs Service has been practically jettisoned in pursuit of revenue targets.   This disposition is impacting negatively on investors. There are too many queries on imports emanating from diverse sources and too many discretionary powers exercised by customs operatives in valuation and classification decisions.The frustrations of Importers are compounded by the clumsy, long winded, bureaucratic processes for seeking redress.  Importers hardly get fair hearing because the customs are the accusers and the judge. A fair, just, speedy appeal process is most urgently needed to save the private sector from the tyranny of the Nigerian customs service.

It is imperative for the federal government to urgently domesticate the WTO Trade Facilitation Agreement to which Nigeria is a signatory. Nigeria ratified on 16th January 2017.