Customs Act 2023: A ‘True Child of Necessity
By Kabir Abdulsalam,
A few days before former President Muhammadu Buhari handed over power to President Bola Tinubu, precisely on May 23, 2023, he assented to the Nigeria Customs Service Act, after rejecting it four times. The new law marked the first amendment to the Act in over 64 years. The act is expected to introduce fundamental changes to the operations of the Service.
In 2022 alone, the former President rejected the amendment twice, in July and October, citing disagreements with several clauses, including 4(b), 7(2), 7(3), 10(1)(a), 10(1)(b), 12, 14(1)(g), 16(3), 17(4), 18(1), 18(3), 18(6)(c), 111(3), 165(5)(a), 170(1)(a), 171, 175(1)(2), 180, 181, 184, 189, 194, 279, and 181.
Although we have less interest in the highs and lows of how the act was passed, however, the major highlights of the Act will shape its operations.
In the new Act, the Presidency granted an additional four percent of Free-On-Board (FOB) value of imports handled by the Service.
The fresh four percent incentive for Customs is outside the existing seven percent cost of excise duty collection, statutorily undertaken by the Service in accordance with international best practice.The Customs had stated that the funds would be part of what the service shall keep and maintain for its operation.
The NCS is now mandated to prepare and forward to the National Assembly, no later than September 30th each year, an estimate of its expenditure and income for the succeeding year.
“The Service shall cause proper accounts and proper records to be kept, and when certified by the Board, the accounts shall be audited by auditors appointed by the Service in accordance with the guidelines supplied by the Auditor General for the Federation.
“The Service shall not later than three months before the end of each year, submit to the National Assembly a report on the activities and administration of the Service during the immediate preceding year and shall include in such reports, audited accounts of the Service and the Auditor’s report on those accounts,” Section 21 of the Act said.
The new Act provides that the President will appoint the Comptroller General of Customs from among career-serving officers of the NCS, not lower than the rank of Assistant Comptroller General (ACG). This is a departure from the previous practice, where the Comptroller General could be appointed from outside the Service.
Recall that the immediate past CG of Customs, Col. Hameed Ali (Rtd) was appointed from outside the Service, a development that had raised eyebrows, especially as a result of his refusal to wear the Customs regalia throughout his almost eight-year reign.
It was this scenario that heralded the appointment of Bashir Adewale Adeniyi, a Deputy Comptroller General, as the acting Comptroller General of the Nigeria Customs Service, becoming the 14th indigenous CGC and 31st since its establishment in 1891.
Interestingly, analysts opined that Mr. Adeniyi, a career officer, as the new helmsman of the NCS, will not only restore the confidence of the rank and file of the agency but will also reposition the service to tackle its failure to maximize its capacity in revenue generation and insulate the economy from the menace of smuggling.
Adeniyi understands that the success of customs administration depends on collaborative efforts with various stakeholders. In his few months in office, he has actively engaged with a wide range of actors to ensure the effective implementation of the New Customs Act.
He forged strategic partnerships through stakeholder engagement with industry associations and trade organizations. Through regular dialogues and consultations, he ensured that the customs procedures are aligned with the needs and expectations of the business community. This collaborative approach has led to smoother trade operations and increased compliance.
During his remarks at a sensitization workshop on the implementation of the Nigeria Customs Service Act 2023, he said that the service will continue to sensitize and educate the public on the provisions of the law.
The Customs boss said: “The Nigeria Customs Service is one of the very important agencies of the Federal Government saddled with the enormous responsibility of administering, managing, and enforcing the provisions of the defunct Customs and Excise Management Act Cap C45 LFN 2004 (CEMA).
“This CEMA was enacted 63 years ago and had remained in operation since then without any significant amendment notwithstanding the expansion in government, growth in population, and dynamic progress and challenges in the economy.
“Consequently, several attempts were made in the past to cause amendments or the repeal of CEMA to no avail. The efforts were necessary because the provisions of CEMA had become obsolete and could no longer adequately meet the contemporary fiscal policies of the Government and the mandate of the Service.”
He added, “We are aware of the onerous responsibilities on the shoulder of Nigeria customer service. And I want to assure all our stakeholders that by working on the pillars of consolidation, collaboration, and innovation, we will discharge our responsibilities on the Act.
“We are going to engage in very constructive consultations with members of the organized private sectors and all the other stakeholders to ensure we get the maximum benefit from this act. We recognize the role of customs as catalysts of economic growth.
Expectedly, economic experts said the impact of the amended act will have a number of positive roles on the NCS effectiveness and improved funding. The additional 4% free-on-board import value will provide the NCS with much-needed additional funding to carry out its operations.
Public Awareness Campaigns
The new Customs Chief spearheaded public awareness campaigns to educate the public about the new customs regulations and promote compliance through several visits to media organizations with prompt and timely press releases.
These campaigns have not only informed citizens about their rights and responsibilities but have also helped in reducing incidents of customs violations.
Under his leadership, he launched an extensive public awareness campaign. This initiative includes targeted engagements with media organizations, facilitating open dialogues with journalists and editors to clarify regulations and inform the public. Additionally, the Service has maintained a proactive approach by issuing timely press releases to address concerns and promote compliance. As a result, incidents of customs violations have significantly decreased, fostering transparency, responsibility, and cooperation within the community and ensuring the successful implementation of the Act.
*Improved Ease of Doing Business*
The Customs chief has streamlined the procedures to improve the ease of doing business in the country. Traders and businesses were assured to face fewer hurdles when importing or exporting goods, to attract foreign investments and boosted economic growth.
Mr Adeniyi has restated that the Service will collaborate with relevant stakeholders for the benefit of Nigerians, to organize a Sensitization Workshop for the two parties.
Similarly, to actualise his dream, he forged a pact with members of the National Trade Facilitation Committee (NTFC) to strategically review the the implementation of the trade facilitation agreement and take bold and courageous decisions to improve Nigeria’s rankings in various indexes.
He made the charge at 2-day National stakeholders retreat on implementing the trade facilitation Agreement in Nigeria, in Lagos.
According to him, the NCS has taken some measures in furtherance of its trade facilitation mission, which includes the automation of trade procedures.
He said, “Customs has raised the bar with the recent launch of the advanced ruling and the recent migration from fast track 2.0 to the Authorized Economic Operator (AEO) system.”
The AEO, he said, is a globally recognized program introduced by the World Customs Organization to secure and facilitate global trade.
“We will identify such countries and, working with all our stakeholders, I will propose that we also have benchmarking visits to study best practices, to note what works in those places and what does not work and why our system can also measure up with what they’re doing,” he added.
It is no longer doubtful that this will help protect the Nigerian economy and generate more revenue for the government. The amendments Act is a welcome development and is expected to improve funding, transparency, accountability, and professionalism of the NCS, while reducing smuggling and trade-based money laundering in the country.
Kabir Abdulsalam is Senior staff writer with Spokespersons digest
