PAUL OGBUOKIRI reports 
•Say: It’s a costly duplication of functions
•‘Foreign interests eyeing multi-billion naira CISS fund’
As independent finding reveals that despite the ravaging coronavirus (COVID-19) pandemic, the Nigeria Customs Service (NCS) has collected over N569 billion as revenue as at end of May 2020; representing 63.2 per cent of the N900 billion 2020 revenue target given to the service by the Federal Government, PAUL OGBUOKIRI reports that there is renewed criticisms against the planned 20-year concession of the revenue collection duties of NCS to four firms in a now controversial e-Customs project. Excerpts…
Controversy over $300m modernisation (e-Customs) contract
It was a well-thought out project, or so it seems. Wrapped under the ‘Customs Modernisation Project’ or “e-Customs Project”, which is to establish a digital /paperless Customs administration was an initiative by the Federal Government to concession the revenue-collection function of the Nigeria Customs Service (NCS) to a consortium of four private firms.
The project targets the Comprehensive Import Supervision Scheme (CISS) fees, paid into a domiciled account at the Central Bank of Nigeria (CBN); the Nigerian Export Supervision Scheme (NESS) and subsequently Customs revenue.
According to the project’s framework, the CISS and NESS revenue sharing arrangement is to “commence on a pro-rata basis against the phase one of the $300 million investment programme only upon commissioning of investments, verifiable by CBN’s Letters of Credit or valid import documentation; and an appropriate termination clause be effective if the consortium is unable to reach financial close within nine months of the concession agreement being effective.”
Sources disclosed that a directive from the Presidency was issued to the ministers of Justice and of Finance, Budget and Planning, mandating them to finalise the concession agreement between Infrastructure Concession Regulatory Commission (ICRC), Nigeria Customs Service (NCS) and a Special Purpose Vehicle company for the deal.
A letter approving the new deal signed by late Chief of staff to President Muhammadu Buhari, Mallam Abba Kyari had generated controversies last year, leading to calls by lawmakers in the House of Representatives that the deal be stopped and investigated.
But the project, which has Bionica Technologies West Africa Limited as sponsors; Bergan Security Consultants and Supplies as co-sponsors; African Finance Corporation (AFC) as lead financiers and Huawei Nigeria as partners has not only been described as a costly duplication of an existing function, but has also come under fresh condemnation.
Stakeholders renew call for cancellation of contract
Aside the lawmakers, several experts and stakeholders have described the deal as an attempt to concession customs revenue collection function to private outfits at a time the Customs is seen to be performing well in revenue collection, trade facilitation and application of existing technology to prevent losses of government income.
They maintained that the NCS has built a robust system especially since 2017 when it introduced the NICIS II which centres around a paperless platform and accommodates relevant organisations such as the CBN, FMF, SON, NAFDAC, NSA and FIRS, commercial banks and more than 3000 private sector companies comprising of importers, shipping lines, airlines, clearing agents, etc.
Sunday Telegraph learnt that NCS has collected more than N569 billion as at the end of May 2020 using its present system- the Webbfontain platform. This collection in the first five months of 2020 indicates likelihood of meeting and surpassing the the N900 billion revenue target for this year even in the face of trade disruptions caused by COVID-19 pandemic.
Speaking, the President of the National Council of Managing Directors of Nigerian Licenced Customs Agents (NCMDLCA), Lucky Amiwero, described the project as “an unnecessary duplication and waste of taxpayers’ money”.
According to Amiwero, Nigeria is presently operating a robust “e-Customs” which he said, integrates the NCS with other government agencies and private operators.
“It is wrong to start talking of giving the same job again four private companies. What new thing are they coming to do? I am talking as an expert, not as one with political or business interest. I was in the Presidential Committee and I served as a sub committee chairman too. I have information. I served in that committee in 2010. The Webbfontain platform has been good all through. When the Pre-Arrival Assessment Report (PAAR) system failed, former Minister of Finance, Ngozi Okonjo-Iweala reverted to that platform, and has been good for the service, the industry and the country with refard to efficent revenue collection and trade facilitation ,” he said.
Amiwero further said: “Any payment being presently made in respect of new contract is an illegal payment and misapplication of scarce national resources. We have a post investment platform in place. We already have e-Customs on ground already. Most of those involved in this new contract are not experts. It is wrong to be making payments on such project when the old functioning one is the one doing the job.
“Who are those four companies, where have they worked? I am talking as a member of the defunct Presidential Task Force on Customs Reforms. Those talking about a new e-Customs are only using language to deceive people. We already have e-Customs on ground. It’s been functioning well over the years.
“The four companies are not experts in trade facilitation. They don’t have any background qualifying them for such job. All we needed to do as a country is to audit and maybe upgrade at a lesser cost.”
A retired Comptroller of Customs, who pleaded anonymity, condemned the planned concessioning of NCS revenue collection function to the four private companies under a Customs modernisation project, describing the deal as a sham.
He said the plan is uncalled for and not in Nigeria’s national interest.
According to him the move is unwise especially as it is coming at a time when Customs is recording significant improvement in its ongoing modernisation processes, insisting that there was no need to engage a third party to develop a technology for the NCS.
He added that the push for the $300 million investment to modernise service is an attempt by some individuals to siphon government’s revenue into private pockets.
He said: “The move is not wise. I don’t know what the government is talking about e-Customs that will make them to concession Customs revenue collection. It has been an issue that some people have been trying to do right from the days when we were in Customs. They want to take the Comprehensive Import Supervision Scheme (CISS) that is being collected from Free On Board (FOB), a very huge amount and the foreigners were the ones collecting this money all through the pre-shipment inspection time.
“When we came back to Destination Inspection, it was reverted and that is what they have been struggling to collect back. I don’t know what the government is talking about e-Customs because as far as I am concerned, Customs has been properly modernised as attested to by the Secretary-General of World Customs Organisation during his visit to Nigeria.
“I challenge anybody to come to the Customs and see what it has on ground and see whether there is a need to invite a third party to come and help Customs in that area. With the technical knowledge of the young officers we have in place, Customs is already doing well, it is just some people who want to steal government money that are pushing for the so called e-Customs.
“e-Customs has always been there at least starting from year 2000. e-Customs was embarked on a very rigorous scale. 19 years after, Customs had done tremendously well in that area. So, for anybody to say they want to put in $300 million to modernise Customs, it is a sham, fraud and anybody that is supporting it is an enemy of the country.
“Secondly, to concession Customs for 20 years is something I cannot comprehend. It means they have sold the agency outrightly.
“Who is collecting Customs revenue today? Is it not the Federal Government through the Central Bank of Nigeria (CBN)? So how can they say they want to concession collection of revenue?”
Reps kicked against the project
Last year, some lawmakers in the House of Representatives vehemently moved against the contract and challenged it’s propriety on the floor of the House of Representatives.
In a letter titled: “Suspension of proposed concession arrangement for the Customs modernisation project”, jointly signed by Chairman House Committee on Finance, James Faleke; Chairman Public Petition, Jerry Alagbaoso, and Chairman Customs, Yuguda Hassan Kila, the lawmakers described the proposed concession as “curious.”
The letter with reference number NASS/CHR/9/2019/JOINT/001 dated October 30, 2019, sources disclosed, led the minister to direct the Permanent Secretary to ensure compliance.
According to the letter: “The House of Representatives on Thursday, October 10, 2019 at the plenary passed resolution No. HR132/10/2019 mandating a joint committee on Finance, Customs and Public Petitions to investigate the curious proposed concession agreement between the consortium Bionaca Technologies West Africa Limited- (Sponsors), Bergman Security Consultant and Supplies – (Cosponsors), African Finance Corporation (lead financiers) and Huawei (lead technical service provider).”
The lawmakers added that their action is pursuant to Section 88 (1) (a) and (b) of the 1999 Constitution of the Federal Republic of Nigeria, as amended, which confers on the National Assembly power to conduct investigations.
They urged all parties involved including the Nigeria Customs Service and Infrastructure Concession and Regulatory Commission to maintain the “Status quo ante pending outcome of investigation.”
On October 10, 2019, Alagbaoso moved a motion that the deal be investigated and his motion was agreed upon via a unanimous voice vote by the House.
Alagbaoso said: “There are some foreign companies who are very eager to sponsor, finance and provide technical services to what they call the modernisation of Customs, without recourse to the National Assembly.
“My motion is the need to investigate the curious concession proposed arrangement between the consortium Bionica Technologies West Africa Limited, who are the sponsors; Bergan Security Consultants and Supplies, who are cosponsors, African Finance Corporation, who are lead financiers and Huawei, Nigeria Customs Service and Infrastructure Concession Regulatory Commission (ICRC) for customs modernisation project.
“The House is aware that various customs modernisation projects in the past. For example in the 90s, the United Nations Conference on Trade and Development (UNCTAD) for the installation of ASYCUDA++ and training of customs officers for three years.
“The House is also aware that the Federal Government agreed to engage former pre-shipment companies for valuation and classification of goods, hence some service providers namely Webbfontaine, Cotecna, SGS and Globalscan were engaged for that purpose.
“This contract was to last for seven years,
