By Stephen Ubanna
After several years of behind the scene maneuvering and litigations, the Nigerian Liquefied Natural Gas, NLNG, limited, a subsidiary of the Nigerian National Petroleum Corporation, NNPC, has finally bowed to the superior maritime powers of Dakuku Peterside, the no nonsense Director General, Nigerian Maritime Administration and Safety Agency, NIMASA.
The Nigerian Apex Maritime Regulatory Agency has been on the neck of the NNPC subsidiary, over the years for the payment of the statutory Shipping , Cabo age and sea protection levies which the Company had been reluctant to pay despiration of their 10 years tax holiday.
Recall that at the start of operation in the country in the late’ 90s past and present Director Generals of the Agency had taken up the issue of statutory payment of the maritime levies with the Company but met stone wall. They could not understand why the NNPC subsidiary company are proving too tough to manage in in the payment of the statutory levies to the Agency to cover their operational cost after the expiration of the 10 years tax holiday, granted it by then Ibrahim Badamosi Babangida, popular, IBB, a retired Army General and former Head of state.
The Value News learnt that the Agency made repeated appeals including sending reminder letters to the Company on the need to pay the statutory levies of three percent levy on ship s on the Gross freight on the free On Board, FOB, on the in-bound and out-bound international cargoes, two percent Cabotage Levy and sea protection levy .
It was gathered that the pressure piled on the NLNG by the Agency the Agency Director Generals including Tony Attah, the present Managing Director, could not be ignored that they were forced to do a rethink on the payment of the levies. This may have prepared their mind that no matter how they tried to avoid the Agency or make trouble with it, the levies are still waiting for it because it is contained in the Act establishing the Agency in May 2007 by then government of Babangida.
The Nigerian Maritime Authority, NMA, now baptised NIMASA ,was armed with the powers to collect such levies from Ships and Shipping Companies operating within Nigeria shores. take for instance, the NIMASA Act , Cabotage Act, Marine Environment Regulations and other extant laws of the Federation which made it clear that all operators within the country’s water ways ,including the NLNG must pay the levies.
It was not surprising why NIMSA has insisted that the NNPC subsidiary must pay the statutory three percent ship levy, two percent Cabotage levy and the sea protection levy . Indeed, the deliberate refusal of the NNPC subsidiary to pay the levies may have encouraged Patrick Akpobolokemi, then Director General of NIMASA , to drag the company to Court to force it to pay the outstanding levies which run into millions of dollars in 2013.
A Statement issued by Isechei Osamgbi, a Deputy Director and Spokes person of the Agency , said the NNPC , subsidiary ought to have paid an outstanding surcharge of $283 million on Cabotage l trade undertaken by its vessels within 200 nautical miles of the baseline s and Nigerian coastal and Inland waters ways as contained in the coastal and Shipping Cabotage ,Act of 2003.
Insiders told the value News that the Agency provided soft landing for the Company t to settle the matter in the case brought against it out of Court . The Agency, according to a source has sought an interpretation of the relevant Act of the Company’s approved Fiscal Incentives, Guarantees and Assurances Act , Cap N87 laws of the Federation of Nigeria 1990 in contrast with the NIMASA Act of 2007.
The dispute became so pronounced that Sambo Dasuki, a retired Army Colonel and then National Security Adviser. NSA, to President Goodluck Jonathan, , had no option but to intervene to save the situation from degenerating. A NIMASA source confirmed that the intervention was at the instance of the former Bayelsa state born President to ensure that the country’s gas business thrive.
Given the deal brokered by the NSA, between the parties, it was revealed that the NNPC subsidiary ”undertook to pay up all outstanding $20 million levies as well as agreed to comply with the requirements of the NIMASA ACT 2007 as well as the Cabotage Act. With the resolve of the Company to pay the levies, the government apex regulatory maritime Agency was forced to lift the blockade placed on its ocean going vessels in January 2013. It was said to have gone a step further to withdrew the case filed against the Company in Court to create room for amicable settlement of the dispute out of Court.
In apparent moves to enforce the NIMASA Act in May , 2013, and to ensure total compliance by the NNPC, subsidiary , i the Agency was said to have met stubborn resistance by the Company which was not ready to comply with the laws. Perhaps, angered by the action of the Company, Akpobolokemi, then NIMASA boss , was said to have ordered the arrest and detention of its vessels for non compliance.
Kudo Eresia Eke, then Spokes person of the Company disclosed that the following vessels: LNG Enugu, LNG Oyo, and LNG Imo , were barred by the Agency from accessing or leaving the Company’s loading bay at Bonny Island, Rivers state. The NLNG Spokes person disclosed that the Agency has no reason to take such drastic action against the Company because of its implication on its international LNG buyers.
He claimed that the NNPC subsidiary had paid about N3.2 billion from its outstanding levies to NIMASA, amidst protest. But the Company may have shown that it was not ready to make peace with the Agency when in June 18, 2017, it dragged NIMASA to Court to seek legal interpretation on the legality of the levies.
The Company may have taken advantage of the 30 days notice allowed it to pay the outstanding statutory levies to run to the Appeal Court in 2017. Andy Odeh, Manager , Corporate Communication and Corporate Affairs , of the Company said they had gone to Court to seek legal interpretation of certain issues in the case from Abubakar Malami, a Senior Advocate of Nigeria and the Attorney General of the Federation , who incidentally is the Minister of Justice and Global West.According to him, the issues in the NIMASA Act , which the Company needed legal interpretation include the legality or otherwise of the levies , NIMASA , had imposed on its operations despite being an Agency of government.
Worried by the alleged obnoxious levies, the NLNG, which had headed to Court was s said to have got a favourable judgment which exempted it from paying the NIMASA levies. The Management of NIMASA, under Perterside, did not find it funny. It could not understand why the NNPC subsidiary , which had earlier given its words to pay all statutory levies accruable to the Agency , including the three percent levy on Gross freight on inbound and outbound cargoes , two percent Cabotage levy and sea protection levy would hide under the cover of the Court not to pay the levies again.
The Rivers state born NIMASA boss, who was not ready to sit by and watch the NNPC subsidiary, make mockery of the Nigerian Maritime laws has no option but to prepare the ground for the Agency to appeal against the Judgment exempting NLNG, from paying the statutory levies as contained in the Act establishing the Agency.
The Agency was said to have headed to an Appeal Court in Lagos Division. On Friday, March 29, 2019, NIMASA heaved a sigh of relief over the case as the Court set aside an earlier judgment of a Federal High Court which had exempted the NLNG ,from payment of the NIMASA levies . The Appeal Court had justified its decision on the grounds that ” NIMASA was not given a fair hearing at the lower Court”. Justice Mohammed Lawal Gruba , who delivered the Judgment was said to have ordered that the” case be sent back to the High Court for a fresh trial under a different Judge”.
An elated Peterside, said the” Court Judgment has shown that the nigeria Judiciary is unbiased and a beacon of hope for Nigerians”. He disclosed that the Agency and the NNPC Subsidiary are neither foes nor competitors but two Organisations working together for the common good of the country. He disclosed that the landmark Judgment would go a long way to ” strengthen the institution and ensure greater bonding” .
The questions on the lips of most Nigerians was: why the NLNG which is making millions of dollars from its trading business in Nigeria is reluctant to obey the country’s maritime laws to pay its maritime levies which is not different from what obtain in other IMO member nations .
This is where Rotimi Amaechi, a former governor of Rivers state and minister of Transportation who has the ear of President Muhammadu Buhari has to throw his weight behind Peterside, the NIMASA boss, to succeed in his plans to ensure that NLNG and other recalcitrant shipping Companies pay the statutory maritime levies to boost the revenue of the Agency.
