Mr. Godfrey Emeka Nwosu, the Tin Can chapter chairman of APFFLON.
Story by Dili Utomi.
The prevalence of differing regimes of the valuation of vehicles for the payment of duties and rates at the different Ports in the country led to the persistent calls for a uniform duty regime in all Nigerian Ports which has culminated in the introduction of the Vehicle Identification Number valuation as enunciated recently by the management of the Nigeria Customs Service (NCS). The above assertion was made by Mr. Godfrey Emeka Nwosu, the chairman of the African Association of Professional Freight Forwarders and Logistics of Nigeria (APFFLON), Tin Can Island Port chapter.
Mr. Nwosu, a firebrand social critic and an advocate for paradigm shift from the manual to the automated means of doing business at the Ports spoke with us on the brouhaha about the recently introduced VIN valuation and much more.
Mr. Nwosu said that the issue about the disagreement borders on value, be it e-invoicing or VIN valuation and that the introduction of the VIN valuation is a reaction to the the long term clarion calls by Operators for the government to introduce a standard valuaton regime that will be uniformly applied at all Nigerian Ports, he stressed that before now, when you take possession of a cleared vehicle from the Apapa Port, the value you paid would have been different from that of the PTML, Tin Can or even the Onne Ports, hence the call for uniformity in valuation over time.
“The question now is how come the sudden introduction of the new valuation protocol? When you talk about valuation , you talk about using the vehicle chassis number to determine the value of the duty acruable from such a vehicle. Here, we have the two categories of Vehicles Valuation, the Standard which is for the American made vehicles and the Non-Standard which is for the European and Asian made vehicles. Their applications differ, for the American vehicles, you have 17 digit numbers for the Chassis number while for the others, you have less than 17 digit numbers and so in such cases applying the VIN valuation becomes a point of crisis since vehicles of the same make, model, year of manufacture and other factors may now attract different VIN valuaton since they were made in different Countries. The issue of percentage depreciation value is also one that has created some level of confusion since the law says that there is a 10% depreciation calculation on every imported vehicle for each year from year of manufacture. Again, a government document introduced in 2020 says that no vehicle should enjoy more that 30% depreciation calculation no matter how old it is and this has caused more confusion within the system, and most operators are not aware of the existence of this document”.
Mr. Nwosu went on to ask the question ” Who represents the operators at any forum meant to engage the policy formulators and implementations, where is the platform for the freight forwarders and importers to have the needed interface with such government agency like the Central Bank of Nigeria or any other agency that formulate policies on the business”. This particular question has always been raised by operators and industry watchers alike and were not answered before the rolling out of these policies of Pre-Arrival Assessment Report (PAAR) and the Vehicle Identification Number valuation, this has thereby compounded the problems that tend to militate against the efficient running of the Ports as the main actors seem to be working at cross purposes with each other, a situation that an observer likened to the children’s cat and mouse cartoon programme aptly named Tom and Jerry. The seeming non-engagement of freight forwarders before, during and after making such policies resulted in the impasse that was witnessed after the activation of the VIN valuaton policy which though, right now looks like through the various channels of dialogue is being settled and the frayed nerves seemingly calming on the matter.
The chairman, noted that it was strange for freight forwarders to realise that after imputing the various data on the vehicle into the system, an outrageous value that was not understood would appear and this led to the temporary withdrawal of service by some members of the freight forwarding community. He declared that though it was mainly the informal freight forwarders, people who work within the corridors of the Customs and valuaton within the business were in the forefront of the protest, but the formal freight forwarders in the registered freight forwarding associations did not really take part in the protests over the introduction of the new protocol, because they could not come together to decide on the modalities for challenging the new policy.
“It is rather unfortunate that the management of the Nigeria Customs Service (NCS) never truly deemed it fit to engage stakeholders before any policy was formulated and this argument was brought to the fore at the stakeholders’ meeting on the 1st of March at the Customs Training School, Ikeja, but the Customs people declared that they had had some level of consultations with some leaders in the freight forwarding business, although they ended up not mentioning any names. At that meeting, we made it known to them that that was the kind of stakeholders’ meeting that we usually clamour for”.
Mr. Nwosu said that generally, everybody has accepted that the VIN valuation is the way to go and that the Customs Headquarters has also declared that there is no going back on the policy. He rather asked then what the basis for arguement is and also answered the question himself. He also asked what the parameters for giving value is, whether it is based on depreciation or the usual internet value? ” In calling on stakeholders to go back to work, the Customs gave a 30 days grace period for all vehicles that have been trapped through this period of argument to be cleared based on the old and existing regime of valuation chart which had hitherto been hidden from operators, they only add depreciation based of certain grading, for example a 2000 model vehicle can be upgraded to 2007 and the depreciation charged attached to it from that year 2007 and so on and so forth. I know for sure that after the expiration of the 30 days grace, the new VIN valuation regime may be fully implemented and we should brace up for this. The only question is the value given on the vehicle, is it the global or the Nigerian value?”.
The Customs has insisted that a level of comparative cost analysis was done with other West African countries before arriving at the rate now being charged, but they forgot to take into consideration that Nigeria is a very large market in terms of importation and that in Ghana, the newer the vehicle, the lower the duty paid on it and the older the vehicle, the higher the duty paid on it and that may be the direction where the NCS is headed and not towards the global price index.
“It is obvious from the body language of the Customs people that they are bent on implementing the new valuaton regime, I am not going to sit here and categorically say that they will or will not do it, but rather say that their body language speaks volume of their intentions, the one month grace period ends on the 8th of April and may be before then, they will come up with a policy statement on the matter. We can only prepare our minds for any kind of decision and as a leader of freight forwarders, I will also advise as far as this matter is concerned that we should not choose where to sleep before the nightfall”.
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