On January 1st 2018, the Federal Government of Nigeria commenced the implementation of the 2017 Revised Import2 and Export3 guidelines. The implementation of the guidelines is in line with the government's efforts to improve international trade whilst enhancing the ease of doing business in Nigeria. The following are key provisions in the revised guidelines: 1. Reduction of Documentation
The required documentation for exports and imports has been reduced from ten (10) to seven (7) and from fourteen (14) to eight (8) respectively.4 2. Palletization of all Cargoes 2.1 Due to goods being shipped into Nigeria which are usually stacked haphazardly without pallets thereby making physical examination impractical or unduly tedious, the guidelines provides that shipping lines are required to ensure that containerized cargoes bound for Nigeria are palletized.5 2.2 Palletization is the process of placing or anchoring the consignment to a pallet or base made of wood or metal. Goods on a pallet may be secured with strappings, stretch wrap or shrink wrap. This method allows for easier handling and storage of
1 Adetola Ayanru, [Senior Associate], and Oluwasolape Owoyemi, [Associate] SPA Ajibade & Co., Lagos, NIGERIA.
2 http://www.finance.gov.ng/images/docs/ImportGuidelines2013.pdf ; and http://www.finance.gov.ng/images/docs/AddendumTo2017RevisedImportGuidelines.pdf.
3 http://www.finance.gov.ng/images/docs/EXPORTGUIDELINESNONOIL.pdf. 4 http://www.finance.gov.ng/images/docs/reductionImportExport.pdf. 5 Section H(5) Ministry of Finance Revised Import Guidelines, procedures and documentation
requirements under the destination inspection scheme in Nigeria (December 2017). 1 of 6
the goods. The advantages are a drastic reduction in storage costs as well as a reduced time frame for loading and unloading operations which was otherwise popular in the era of containerization. Palletization also enables efficient examination of the consignments.
3. Complaints and Detriments of the Palletization Policy
3.1 Importers and stakeholders have expressed dissatisfaction regarding the new palletization policies. Some of these complaints are as follows: a. The Federal Government's new policy on cargo palletization could cost Nigerian importers $60 million dollars 6 and cost the economy over N500 billion annually.7
b. The palletization policy would increase rather than reduce the need for manual cargo examination due to the non-deployment of the required technological input to aid the palletization process. Such inputs include; scanning machines, automated customs processes and good access to the ports.8
c. Palletization takes up a lot of space. Cargoes to be freighted in one container will have to be divided and importers will have to pay increased freight charges for fewer amounts of goods.9
d. Fragile goods and liquids cannot be packed on wooden pallets and it may encourage the diversion of cargo to neighboring countries which will in turn, aid corruption.
e. Palletization on wooden pallets could attract importation of strange organisms into Nigeria if not specially treated.
f. It may lead to importers reverting to the era of Unimodal means of transportation thereby reducing the amount of cargoes that come through the Nigerian seaports.
g. Loss of revenue for the Government.10
6 http://punchng.com/cargo-policy-maritime-operators-fret-as-fg-threatens-defaulters/ accessed 19th February 2018.
7 https://guardian.ng/news/nigeria-may-lose-n500-billion-yearly-to-new-cargo-policy/ accessed 3rd February 2018.
8 https://guardian.ng/business-services/maritime/deficient-scanners-and-controversial-cargo-policy/ accessed 19th February 2018.
9 Ibid. 10 Ibid.
2 of 6
4. Addendum to Palletization Policy of Containerized Goods in the 2017 Revised Import Guidelines Procedures
Due to the series of complaints from stakeholders, shippers, clearing agents, operators and requests received from the trading public in respect of the palletization policy contained in the 2017 revised import guidelines, the Federal Ministry of Finance on 12th February 2018, released an amendment to the Addendum on the Palletization Policy for Containerized Goods in the 2017 Revised Import Guidelines Procedures and Documentation Requirements Under the Destination Inspection Scheme in Nigeria.11 The following changes have been introduced:12
4.1 All containerized cargoes coming into Nigeria must comply with international standards for packing/stuffing and loading into containers;
4.2 Cargoes must comply with specific packing and stacking standards prescribed by the original manufacturer of the product;
4.3 Loading without pallets or containerized cargoes are only accepted if they comply with international standards or with specific packing and stacking standards prescribed by the original manufacturer or product;
4.4 With the exception of used automobiles and heavy machinery, all loosely packed items without loading and packing prescription should be packed in crates or cartons on top of pallets.
4.5 Cargoes must be loaded neatly in a manner that is safe and will facilitate speedy examination and clearance at the ports by the Nigerian Customs Service (NCS).
4.6 Importers that default on the palletization provisions for shipped goods shall be asked to take back onboard the non-palletized cargo13 or be liable to a fine of 25% of the total cost of the freight on Board (FOB) charges of the unpalletized goods. The amount shall be paid into the Comprehensive Import Supervision Scheme account with the Central Bank of Nigeria (CBN). The sanction shall be enforced and implemented by the Nigeria Customs Service (NCS).14
4.7 The Minister of Finance, Mrs. Kemi Adeosun announced that all goods already loaded for shipment to Nigeria prior to 1st January 2018, (the date of implementation
11 http://www.finance.gov.ng/images/docs/palletizationPolicy.pdf. 12 Ibid. 13 Section I (1) Section H(5) Ministry of Finance Revised Import Guidelines, procedures and
documentation requirements under the destination inspection scheme in Nigeria (December 2017). 14 Ibid section J(1).
3 of 6
of the guidelines) will not be affected by the palletization policy, provided the shipped goods arrive Nigeria before 31st March 2018. Even with the addendum to the palletization provisions, the grace period given up until 31st March 2018 still remains in force.
5. Fresh list of documents required for shipment in international trade
S/No Import Trade Documents
Export Trade Documents
1. Bill of Lading
Bill of Lading
2. Certificate of Origin
3. Commercial Invoice
Certificate of Origin
4. Exit Note
5. Import Declaration Form (Form M) Single Goods Declaration (SGD)
6. Packing List
Nigeria Export Proceed (NXP)
7. Single Goods Declaration (SGD) Clean Certificate of Inspection (CCI0)
8. Product Certificate
6. Time requirement for processing exports and imports
6.1 The minimum cargo placement notice time for examination required by Terminal Operators has been reduced from twenty four (24) hours to a maximum of twelve (12) hours. This means that after the NCS agrees with all parties on a suitable time for physical examination, terminal operators now only require a twelve (12) hour notice to place the cargo for examination.15
7. Responsibilities of Authorised Banks
7.1 Authorised Banks shall remit in respect of imports, only the amount stated on the Certificate of Origin/Commercial Invoice/Final Invoice to the importer.16
7.2 Authorised dealer Banks are to ensure that shipping documents are received within 21 days after shipment and should retain evidence for the purpose of monitoring by the Central Bank of Nigeria.
15 https://www.customs.gov.ng/Publications/news_results.php?NewsID=277. 16 http://www.finance.gov.ng/images/docs/AddendumTo2017RevisedImportGuidelines.pdf.See
section (G) Addendum to Federal Ministry of Finance Revised Import Guidelines, procedures and documentation requirements under the destination inspection scheme in Nigeria (December 2017).
4 of 6
8. Repatriation of Export Proceeds
8.1 For repatriation of export proceeds for non-oil and gas products, all exporters shall ensure that export proceeds are repatriated and credited to their export domiciliary accounts within 180 days from the date stated on the Bill of Lading. It is the responsibility of the Central Bank of Nigeria to monitor the repatriation of all export proceeds.17
8.2 Any exporter that defaults in the repatriation of export proceeds within the time limit specified in the CBN Foreign Exchange Manual shall be liable to a penalty of 1% of the outstanding export proceeds.18
9. Additional responsibilities given to Nigerian Customs office, Nigerian Ports Authority and other officials
9.1 The Nigerian Customs Service (NCS) is now required to schedule and coordinate the Mandatory Joint Examinations and sign-off Form to ensure that there is only one point of contact between importers and officials. Prior to this innovation, importers had to reach out to requisite agencies and operators to schedule a time for the joint examination of cargo. This new directive will be carried out during official hours between Mondays and Saturdays. The purpose of this is to avoid a consignment being examined multiple times by multiple agencies of Government as was the situation prior to the introduction of the revised guidelines.19
9.2 Shipping companies are now required to transmit the cargo manifest electronically to the NCS and the Nigerian Ports Authority (NPA), before leaving the last Ports of call to Nigeria.20
9.3 Upon receipt of the manifest electronically from the shipping company, the NCS and NPA shall take the necessary steps to circulate the cargo manifests to other examination and regulatory agencies as soon as they are received, to provide enough time for risk assessment, profiling and optimized placement of cargoes.21
17 Section 23 (a), (c) Federal Ministry of Finance Revised Export Guidelines for Non-Oil Export (March 2017).
18 Ibid section 26(b). 19 https://www.customs.gov.ng/Publications/news_results.php?NewsID=277 accessed 22nd January
2018. 20 Section H(4), Ministry of Finance Revised Import Guidelines, procedures and documentation
requirements under the destination inspection scheme in Nigeria (December 2017). 21 Ibid section H(3) and section H Addendum to the Ministry of Finance Revised Import Guidelines
5 of 6
9.4 In order to accommodate the regulatory functions of more agencies in respect of international trade, the NCS is required to strengthen the functionality of the Nigeria Integrated Customs Information System (NICIS).22
9.5 The NPA shall also continue to be responsible for traffic management and the smooth pilotage of vessels.23
Conclusion The World Bank's 2018 report on doing business 24 which gives an indication of where it is easier to do business around the world, ranked Nigeria 145th of 197 countries assessed. Although still on the low end, the ranking is a significant improvement from Nigeria's previous ranking of 169th in the 2017 report. The implementation of these revised guidelines signals a new wave towards greater efficiency, accountability and transparency in the export and import industry. It will also encourage diversification in Nigeria's economic sectors and reassure investors and parties in International trade of the efforts by the Government to promote a conducive business environment. The Federal Government's amendment to the Addendum on Palletization Policy for Containerized Goods contained in the 2017 Revised Import Guidelines also indicates that the government is listening and taking into account the opinion's and concerns of stakeholders and traders. The policies in place seek to encourage the elimination of bottlenecks which had erstwhile contributed to inefficiencies in international trade dealings in Nigeria. It is hoped that these guidelines will lead towards a better regulated, more transparent and business friendly environment.
For further information on this article and area of law please contact Adetola Anyanru at: S. P. A. Ajibade & Co, Lagos by telephone (+234 1 472 9890), fax (+234 1 4605092), mobile (+234 807 819 1720) or email (firstname.lastname@example.org), or Solape Owoyemi via email email@example.com.
22 An electronic trade platform deployed as a virtual single window framework for relevant regulatory agencies to facilitate and enhance the management of international trade dealings. https://www.customs.gov.ng/downloads/nicis-brochure.pdf
23 Section G(2) Ministry of Finance Revised Import Guidelines, procedures and documentation requirements under the destination inspection scheme in Nigeria (December 2017).
24 http://www.doingbusiness.org/~/media/WBG/DoingBusiness/Documents/AnnualReports/English/DB2018-Full-Report.pdf accessed 18th January 2018.
6 of 6