VIN Implementation: Customs agents plead for 90-day moratorium 

An aerial view of PTML port, Lagos

After a week-long peaceful protest during which customs processing activities in Tin Can Island Port and PTML Terminals were boycotted, organised licensed customs agents and freight forwarders in Tin Can Island under the umbrella of Coalition of Association of Stakeholders in Tin Can Command, have petitioned the Comptroller-General of Customs and demanded from the Federal Government a 90-day moratorium before the commencement of the implementation of the Vehicle Identification Number – Valuation.

The Coalition also submitted a five-point position to the Comptroller-General jointly signed by ANLCA, NAGAFF, ARRFFN, NCMLCA, APFFLON and LCCI. They described the VIN initiative as brilliant and a welcome development that would enhance trade facilitation by reducing physical interface between Customs officials and customs agents but expressed reservations about the flag-off and its timing which did not factor in their members whose position is vital in revenue facilitation for government.

Customs clearing activities at Tin Can Island Port have come to a standstill for several days in late February following protests over the sudden introduction of VIN-Valuation and its accompanying 900 percent increment in tariff payable on imported vehicles. Distraught customs agents who have since stopped work and barricaded Customs Processing Centre entrances have voiced their grievances on this development and seemed determined not to go back to work until the Federal Government revisits and reviews downwards the new charges.

The Coalition put forward to the CG the under listed working terms, going forward as follows: The timing of the introduction of VIN was short with no adequate information and sensitization

Provision be made for Depreciation on Calculated Values which concedes 10 percent for wear and tear on used vehicles and machines.

Inclusion of stakeholders in future policy decision making before implementation.

All assessments and Paid Declaration caught up in the VIN-Valuation crisis should be attended to and released by Customs in order to stave off demurrage and storages from shipping companies and terminal operators.

A plea for 90 days moratorium to the authorities especially the Federal Ministry of Finance and the Nigeria Customs Service before a rescheduled official take off.

Experts including the Customs Area Controller of PTML Customs Command, Comptroller Festus Okun and top customs agents have all uniformly declared the new VIN instrument as a very positive development that would take the customs clearing trade to the next level.

VIN would engender transparency – Comptroller Okun

According to Comptroller Okun, VIN is a necessity for customs and importers as it would engender transparency and predictability, no speculation or miscalculation any longer. There will be uniformity of values across all customs commands in Nigeria.

Okun further noted that “it will eradicate human contacts, remove discretionary duty value borne out of sentiments and address the problem of having variations in the value of same vehicle model and age in various commands of the Nigeria Customs Service.”

Okun said VIN is a reality which importers, licensed customs agents and freight forwarders have to embrace with an open up their mind, and warned them not to be caught on the wrong side of the law as the robust audit system in the service will unveil infractions and demand for revenue evaded

The CAC added that with the VIN valuation, the longer time hitherto spent on raising value will be saved and more importation processed within a short time.

VIN is an import value crisis – Nwosu

Mr. Godfrey Nwosu, the Chief Servant of Africa Professional Freight Forwarders Association of Nigeria (APFFLON), Tin Can Island Chapter, who described the VIN an import value crisis said the VIN is a good policy but its time of implementation by the Federal Government is wrong as it has cause spike and instability in the prices in the open markets.

While concurring with the position of the Customs on the desirability of the VIN for the economy, Nwosu averred that the government should educate freight forwarders and customs agents who will in turn take the information about the policy down to their principal importers.

He said that many vehicles cleared over four years are yet to be sold, saying that the VIN would further lead to chaos if not properly managed. According to him, “the policy is already affecting the customs in terms of revenue as many importers have abandoned their vehicles in the ports. Time is not ripe for its implementation because there was no wider consultation and awareness by the customs for freight forwarders. The online awareness is not enough; there is a need for physical conference. I want to appeal to the government to suspend the policy for now; apply a conflict resolution and dialogue with them and importers.”

VIN be subjected to rigorous test – Imonitie

Speaking to PortNews on the development, Barrister Ovien Michael Imonitie, the Secretary of Association of Nigeria Licensed Customs Agents (ANLCA), Tin Can Chapter, said the VIN is a good policy but must be subjected to a rigorous test of conformity especially in the area of depreciation of used vehicles and other goods that do not appreciate in value.

Admitting that the VIN would enhance trade and lead to increase revenue for the government, Imonitie said that its implementation was ill-timed as the government did not enlighten customs agents who, in turn educate their importers, adequately.

The ANLCA scribe maintained that ANLCA is not against the policy but rather the approach of the customs towards the implementation. He noted that customs agents have taken their times to comply with all government policies including the Ease of Doing Business but the Customs has not helped the situation as all its units and departments want to partake in cargo release transaction, especially valuation.

Imonitie averred that there should a timeline of 90 to 120 days for government to enlighten key stakeholders in import chain before going ahead for implementation. According to him, this period would give importers and their agents enough time to reappraise their imports, do damage control and effectively key in into the policy.

“There should be a timeline for the new policy to kick off, at least 90 to 120 days, so that everyone will key in not when importers had already imported. This period will give us ample time to do damage control. It is unfortunate that terminal operators taking advantage of the situation as many vehicles abandoned in their terminals are attracting huge demurrages.

“I want to beg the government to conduct a training/sensitization on the VIN for customs agents and other important stakeholders in import and export business. This will give customs agents opportunity to sensitize their importers too on the importance of VIN,” Imonitie advised government.

VIN laudable but exploitative – Nweke

Baring his mind on the VIN issue, Dr. Eugene Nweke, said VIN is a laudable but exploitative. He said the Nigeria Customs deserves commendation for the initiative, especially in the context of trade facilitation and operational enhancement, but the revenue motive is another ball game.

According to Nweke, the former President of National Association of Government Approved Freight Forwarders (NAGAFF), First, we must agree that using or driving a tokunbo vehicle in the present-day Nigeria, is a necessity and not a luxury in the face of rising population and urbanization without a corresponding transport Infrastructures and networking.

Secondly, good or bad, the Management deserve a commendation for the initiative, especially in the context of trade facilitation and operational enhancement, but the revenue motive is another ball game.

On the VIN saga, my take after a careful observation, VIN is laudable and exploitative.

Exploitative because, it is a subtle but deliberate imposition of an outrageous benchmarks for used vehicles, all in the name of actualizing revenue objectives without recourse to wider social and security implications.

Here again, in matters like this, we must appreciate that, the Customs Service is a revenue generating arm of the government. The government of the day, believes too much that the best way to rate the service performance per year is by its revenue yearly generation and not be the quantum of value it adds up to the port value adding supply chain, in this case, trade rigidly, scrutiny and exploits is a sure performing word to its daily activities. So other than taking it way too hard on the service, it is always important for one to mirror the handwork of the government behind the service.

For all intents and purposes, this policy seems to have failed to meets its expectations. I don’t want to visit the aspect of economic advantages cum benefits that was propounded and canvassed by the promoters of the said auto policy then.  Other than admit its failure of administering a sound national auto policy, it resorts to duty benchmark imported used vehicles, mainly for revenue, while the national auto industry is left in the ocean of administrative inconsistency.

Let’s go back to history, then posit this important question, at what point did we as a nation resort to the Importation of used vehicles? We lost it as soon as we sacrificed our national auto policy of 1973 and altered our brands taste of Volkswagen, Peugeots, Fiats, etc for Japanese & Mercedes brands.

Peugeot series and Volkswagen series were our popular brands then, till the military administration signed up for Structural Adjustment Program of the World Bank, the prevailing situations, including the so-called VIN is the outcome of that compromise.

The resort to VIN or benchmark is an open admission on the part of government that we are a second-hand nation.

In conclusion, the VIN can be adjudged as a laudable concept if viewed from the context of trade facilitation and as such desirous, this is because it reduces human contacts, in clearance operations.

VIN lacks predictability -Farinto

The Vice President of Association of Nigerian Licensed Customs Agents (ANLCA) Dr. Kayode Farinto has stated that the Vehicle Identification Number (VIN) valuation policy is not helping the nation’s economy as it lacks predictability and unable to drive revenue collection.

Farinto in a media chat said for the last past one week, clearance of vehicles has been stopped due to the outrageous VIN values by the Nigeria Customs Service.

“We won’t be tired of informing the Nigerian government what is happening in our industry. In the last one week, our members were unable to clear vehicles from the ports as a result of introduction of VIN by the Customs.

“Why should we opt for VIN valuation? You will agree with me that before now, I was one of those that said there was no uniform value on the clearance of vehicles. For example, if you have 2015 Camry in Tin Can, Apapa and PTML, you will never pay the same duty on them and these vehicles are going to the same market.

“This is causing serious unease for our members; it encourages corruption and it is making us not to have predictability in business transaction. One of the first criteria of Central Bank of Nigeria (CBN) is, there must be predictability in Customs clearance. Hence, we now say okay, give us uniform value or key into that of Ghana system. That is where the issue of VIN came onboard,” Farinto said.

According to him, before Customs implement any policy, it is expected of them to collaborate with stakeholders especially the licensed Customs brokers, adding that Customs needs to subject their value to public criticism for stakeholders to have their inputs.

However, he argued that the introduction of VIN is not helping the economy as it has made the clearance of cargoes particularly vehicles stagnant in the last four days. Vehicles are accumulating storages at the nation’s seaports.

“We are now calling on the Customs to invite us, subject the values to criticism because you cannot shave our head in our absence. The legal notice 30 talks about we are and tier, rebate. Once a vehicle is bought in 2022 in America, if you buy a car on January 1 and you drive it from Houston to Texas to far north, once it is used, it depreciates, 10% depreciation law comes in, same thing everywhere in the whole world. It is a standard thing.”

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