How VIN Strike Cost Agents N700 million, Farinto, Cautions Against Fresh Strike Over 15% vehicle Levy

By Stephen Ubanna

Importers with their Clearing Agents appear to have disappointed their Apapa Area boys Collaborators who had expected them to take advantage of the National Automotive Council, NAC, Levy of 15% on imported vehicles into the country despite the 20% rate of duty on such vehicles to withdraw their services  from the Tin can Island port and Port Multi-services Terminal, PTML.

 The Tin can Island port and PTML, are the only two areas where vehicles are shipped into the country from Europe, Asia and the North American country of the United States through their RORO facilities.

Note that with the ban on the importation of vehicles, both new and fairly used from the Land border in January 1, 20217, many of the transit vehicle importers patronizing the Autonomous port of Benin, Cotonu, and Bollore, port, both in Republic of Benin and other ports in the West African sub-region have relocated to Nigerian ports, particular, Tincan Island and PTML, which have the RORO facilities to take delivery of their vehicles.

Between 2017 and 2022, there have been a running battle between the Hameed Ali, a retired Army Colonel led Nigerian Customs Service, NCS, over the 35 duty on imported vehicles into the country. The government may have slammed the 35% duty on imported vehicles, both new and fairly used vehicles passing through the nation’s ports with the adoption of the five year-old Economic Community of West African States  Common External Tariff, CET, in 2017, which it had adopted based on the World Customs Organisation, WCO, recommendation.

While the Agents and the Customs Authorities and the the Leadership of the various Associations of the Freight Forwarders were still talking over the high rate of duty on imported vehicles, the government came up with another policy: Vehicles Identification Number, VIN, for assessing duty payable on imported vehicles. The introduction of the  VIN policy and its implementation

This may hay have forced the agents to withdraw their services from theTin-can Island and PTML on the grounds that the policy has increased the cost of clearing  an imported  vehicle through the nation’s port. Assistant Comptroller General of Customs, and Zonal Coordinator, Zone A, Aremu, Customs Comptrollers Kayode Oloyede, Tin Can Island Command Felix Okun, PTML,were said to have facilitated the call off of the strike , through several meetings with the Leadership of the Agents and a Town Hall meeting with the stakeholders.

The feed back from the various meetings with the Agents that was said to have been sent to the Customs Management may have encouraged them to approve a one month grace period for the importers with their Agents to take delivery of their abandoned vehicles throughout the period of the strike and the new arrivals at the Tin can Island port and PTML.

Informed sources told The Value New that even with the one month grace period given to the vehicle importers with their agents to take delivery of their vehicles at the port and vehicles terminals, the response have not been very encouraging.

Imported Vhicles At Fiver Star Terminal, Tincan Island Port Awaiting To Be Cleared

The source disclosed that the situation had been made worse with the signing of the Finance Act by President Muhammadu Buhari, a retired Army General, into Law and the NAC, policy,  which had encouraged the NCS Authorities to retain  the 2017-2022, ECOWAS CET, rate of duty for imported vehicles of 20% with a levy of 15%, which an insider had said was supposed to be a   two percent  of the Cost Insurance Freight, CIF, on imported  vehicles, or spare parts .

The NAC 15% Levy, according to ministry of Finance, Budget and National Planning sources is to be used by the Council  to support vehicle assembles, manufacturers of auto spare-parts and other local manufacturers enhance technology transfer and skill acquisition , create jobs and increase the country’s per capital income.  

The vocal group of Agents who are in the majority , in the Association of Nigerian Licensed Customs Agents, ANLCA, National Association of Government Approved Freight Forwarders, NAGAFF , National Association of Managing Directors  of Licensed Customs Agents, NAMDLCA and other Agents and Truck Drivers Associations at the port , who are working closely with the Area boys, were said to have been pushing the Leadership of these various Associations to declare another round of strike. There intention is  to paralyse operations at Tin can Island port and PTML to force Ali and his Management team, who are working closely with Hajia Zainab Ahmed, minister of Finance, Budget and National Planning to cancel the NAC 15% vehicle levy.They may have gotten it wrong.

Farinto: VIce President ANLCA

This is because Kayode Farinto,  Vice President, ANLCA, who may have spoken the mind of the Leadership of NAGAFF and other Associations, had said that those plotting for another round of strike at the Tincan Island port and PTML, used for shipment of  foreign vehicles into the country will fail.

 He noted that the strike will not be favourable to the vehicle importer with their agents and the country’s economy in general but would only  favour the terminal operators.  He has his reason.According to him, agents withdrawal of their services at the port and terminals, gives the terminal operators opportunity to make money from their services at the Tin can port and PTML, which have RORO facilities.

The ANLCA acting President may have sent a warning to the agents mobilizing to throw the Tin can Island and PTML into  another round of crisis to watch it as ‘’ the various terminal operators  and shipping Companies  will  not waive  demurrage incurred during such strike because they were  didn’t cause the strike action.

Farito, may have shocked Nigerians when he reportedly said that the VIN Strike, which was said to have paralysed operations at Tin-can Island port and PTML, that had lasted almost a month,  cost the Agents over N700 million in demurrage from terminal operators and shipping Companies.

Perhaps, this may have informed why the Leadership of ANLCA, particular, have resorted , to dialogue with the Customs Authorities as part of the rule of engagement to avert another crisis at the port and vehicle terminals that would give the terminal operators and shipping the room to fleece Nigerian vehicle importers in guise of demurrage.

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