Towards building a modern Customs

customs

The recent passing of the Nigeria Customs Service Management Act (Repeal and Re-enactment) Bill, 2017 by the Senate has opened up a new vista in the life of the Nigeria Customs Service (NCS), which has almost become desolate with the archaic Act it was operating under.

As rightly cited by the Senate, the Act establishing Customs had not undergone a major overhaul since 1958, so it is to right say that the passage of the bill would help to reposition the service which is a major revenue earner for the Nigerian government.

Legal experts and even laymen had bone to crack with the Act. The 1958 CEMA is considered one of the oldest key laws operational in Nigeria. In 1958 when the law was made, the country was under British colonial rule so the Act by implication had the imprimatur of the colonial Lords.

Those who drafted the law ruled on their perceived scope of the Nigerian economy, world trade facilities, capitalist and socialist inclination and poorly organized Nigerian society that lacked adequate local professionals at the time.

For instance, the 1958 CEMA does not cover oil-lifting rights. Understandably, oil was not the mainstay of the Nigerian economy when the law was passed, but the reality is different today.

Trade practices procedures and sanctions that existed in 1958 are no longer relevant, fines and penalties prescribed by CEMA are absurd and generally incapable of deterring economic criminals even if fully enforced.

The initial gap analysis of the 1958 Act conducted in 2009 revealed that gaps in between the law and provisions of the World Customs Organisation (WCO) revised Kyoto Convention, which Nigeria is a signatory to and which provides the benchmark for modern day Customs operation.

The 1958 Customs and Excise Management Act (CEMA) also does not contain provisions to support the use of modern information communication technology such as use of electronic documents, signatures and payments as well as application of risk management, post clearance audit and special, simplified procedures for qualified readers. This is understandably so because at the time it was passed, most operations were performed manually, unlike the IT-driven processes that rule the 21st Century.

The penalty structure of the 1958 CEMA is also severely outdated to the point where it has become inconsequential for unethical traders to break the law. Penalties of N100 or such-like are still contained in the law as punishment for grievous economic crimes.

Simply put, the 1958 CEMA became a clog in the wheel of progress – outdated, reactionary, inadequate and at odds with modern day realities.

Proponents of the amended CEMA saw the need to incorporate modern day Customs practices, traditions and obligation while not leaving out the various conventions and instruments on Customs and trade standard practices of the WCO, the United Nations Conference on Trade and Development (UNCTAD) and the World Trade Organisation (WTO).

So for Nigeria to fully exploit the benefits of its strategic placement and its ambition to be the maritime hub of the West and Central Africa sub-region, its trade laws, especially as they relate to the operations of Nigeria Customs Service, must become modernized, simplified and in consonance with present day realities.

While commending the upper legislative chamber for deeming it fit to reform the Customs law, we urge the lower chamber – the House of Representatives – to make haste to concur to the amendment. Acting President YemiOsinbajo must also be prepared to sign the law immediately it gets to his desk.

Most importantly though is the implementation of the law and restructuring of Nigeria Customs Service. The present Customs management must see the new law as a unique opportunity to overhaul the NCS and tune up its manpower and operation to respond in a prompt and timely manner to present day trade demands.

One of the problems of Nigeria’s trading system today is that its Customs processes are overly centralised and too manual.

Hameed Ali, a retired Colonel of the Nigerian Army, who heads the NCS at present, must take it upon himself to bequeath a legacy of reform on the establishment.

The opportunity to restructure Customs, automate its operation, eliminate manual processes and bring it up to speed is now. 

Copyright 2017 Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to www.shipsandports.com.ng as the source.