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NEPZA kicks against provisions of Custom Service Bill before NASS

By Anthony Otaru, Abuja
16 December 2021   |   12:10 pm
The Nigerian Export Processing Zones Authority (NEPZA) has opposed some sections of the proposed Custom Service reform bill before the National Assembly especially the aspect of the amendment that will give the Customs Service regulatory powers in the Free Zones. It says such development will further weaken, subvert Nigeria's Special Economic Zones. The NEPZA team…

The Nigerian Export Processing Zones Authority (NEPZA) has opposed some sections of the proposed Custom Service reform bill before the National Assembly especially the aspect of the amendment that will give the Customs Service regulatory powers in the Free Zones.

It says such development will further weaken, subvert Nigeria’s Special Economic Zones.

The NEPZA team led by the Managing director, Prof. Adesoji Adesugba, made the position known yesterday in a submission to the ongoing public hearing on the Custom reform bill at Nigeria’s House of Representatives,

NEPZA said, “free Zones are areas designated as such by the President to serve as one-stop-shop investment hub wherein incentives are provided in form of tax holidays, simplified Customs and Immigration processes, amongst others, with a view to attracting investors.”

It said for example, that the One-Stop-Shop concept, in furtherance of which Regulations were made for all the active Free Zones with the involvement of the Nigerian Customs Service and all relevant stakeholders, would be eroded if the provisions of the bill are allowed.

The Authority, therefore, urged the National Assembly to be circumspect by avoiding the temptation of allowing any legal framework that would cripple NEPZA and the free zone scheme.

It added that by providing regulations for the free zones, the Nigeria Customs Service would be setting a dangerous precedent, as other agencies would want to do the same.

Still responding, the authority also held that the development if not nipped on the board would result in either multiple regulations that might be contradictory thereby creating avoidable legal tussles or making registration of enterprises unnecessarily cumbersome and unattractive.

It further explained that the proposed sections of the bill which seek to make the Free Zones Customs- Controlled Zones invariably seek to create antithetical Free Zones Customs Territory alien to the global free trade zone model used around the world.

While listing specific areas of the Bill it finds objectionable, the Authority stated that it had contributed to the national economy, noting that the Lekki Free Zone Quadrant that comprised Lekki Free Trade Zone, Lagos Free Zone, Dangote Free Zone Enterprises and the Alaro City Free Zone as well as the Calabar Free Zone and the Kano Free Zone were alluring testaments of how it continued to fast track the country’s Industrialization.

“Dangote Free Zone, a national asset, is a zone with enormous prospects for the Nigerian economy. With the heightened insecurity in Nigeria amidst the COVID-19 Pandemic, the introduction of a new bureaucratic bottleneck such as this proposed legal framework would only scare away investors and retard the free trade zone scheme.

“Bureaucratic bottlenecks have been identified as one of the reasons for Nigeria’s low ranking on the World Trade Organization’s index of Ease of Doing Business. The free zone scheme, therefore, seeks to tackle the problem of corporate investments characterized by bureaucratic challenges, multiple taxation, conflicting regulations,” the Authority said.

It, however, allayed the fears of the Nigerian Customs Service about revenue leakages, adding that it had put in place proper customs procedures and regulations to guide investors operating in the zones in order to avoid or prevent bureaucratic bottlenecks while ensuring that all applicable laws, regulations, and guidelines were duly observed.

These safeguards, NEPZA noted, could be ascertained in its enabling Act, as well as the regulations of the respective free zones.