Why Nigeria needs antitrust law now, by STOAN chief
The Chairman of Seaports Terminal Operators Association of Nigeria (STOAN), Princess Vicky Haastrup has called on the Federal Government to urgently enact an antitrust law to engender competition and discourage monopoly in all facets of the nation’s economy.
Antitrust laws are enactments that regulate the conduct of business corporations with a view to promoting fair competition for the overall benefit of the citizens. While such laws are known as antitrust law in the United States, they are known as competition law in other English speaking countries.
Princess Haastrup, who spoke while fielding questions from our correspondent commended the Buhari government for ending a form of monopoly foisted on the maritime sector through a so-called oil & gas cargo terminal which restricted the reception of such cargoes to one of the terminal operators out of the 26 that won the 2006 port terminal concession.
Making reference to the recent presidential directive on maritime sector titled “Conveyance of Presidential Approval-Re: Report on Concessioned Terminals on the Ports,” which effectively ended the era of the so-called oil and gas cargo terminals and empowers all terminal operators to receive cargoes in line with the Port Concession Agreement of 2006, Haastrup said such monopoly should not have arisen in the first place.
She said: “Let me state that, this situation ought not to have happened in the first place because in maritime language, globally, there is nothing like an oil & gas cargo… You have either ro-ro, container or general cargo. Everything about the so-called oil & gas cargo falls under general cargo. When we were all going through the period of due process of tendering and applying for the concessioning of these ports, these were the only three categories, the only acceptable language, so to speak, all over the world. None of us applied to be an oil & gas terminal because such terminology did not and still does not exist.
”But along the line, after we had commenced operations, the language began to change, we didn’t know why it started in the first instance, it ought not to have started. So the issue of monopoly should not have been there in the first place.
“So the issue of it happening in the first instance is absurd and it’s against the spirit of the concession itself because what you are seeing is that importers of goods to Nigeria do not have a right to go to any terminal of their choice and when there is monopoly, cost of doing business over that particular cargo goes up, it’s either you come to me or you forget it.”
Following strident calls by members of STOAN and other key stakeholders in the industry on the Federal Government to end the regime of monopoly in the maritime sector through a pronouncement against the recognition of oil & gas cargo terminal, the government through a presidential directive on May 5 2017, acceded to the agitation.
The directive was unambiguous: “FGN remains guided by the general global practice in the designation of terminal/ports operations into three broad categorisations of bulk cargo, container cargo and multi-purpose cargo. Accordingly, the FGN rejects the categorisation of oil & gas multi-purpose cargo terminal, as this is alien to the relevant concession agreements and inconsistent with global shipping practices.” This directive effectively brings the regime of monopoly in the industry to an end, according to maritime sector watchers.
With the presidential directive, Haastrup said the maritime sector, the economy and the nation as an entity are the winners.
She broke this down: “With this directive, the volume of cargo to Nigeria will definitely increase, this will translate to increase in cargo throughputs, which will lead to reduction in the cost of doing business; implying more activities in the ports, thereby boosting employment and strengthening the economy in the final analysis.”
To ensure that the nation does not go back to the era when only one operator could receive the so-called oil & gas cargo at its terminal, Haastrup urges the government to, first, gazette the latest presidential directive, and then, enact an antitrust law.
Along the same line as Princess Haastrup, another leading operator and Managing Director of Ports and Terminals Operations Nigeria Limited (PTOL), Mrs Lizzie Ovbude, in a media chat, said the industry had been made vibrant with the presidential directive.
With the new policy pronouncement, according to Mrs Ovbude, the high cost of business at the ports when monopoly was in place would come down thereby attracting importers who had hitherto relocated to ports in neighbouring countries.
Ovbude said: “It’s been quite revealing since the presidential directive, even our customers are now in high spirits, knowing that they have options now and nobody is forcing them to take a particular terminal. When monopoly was the order of the day, we lost a lot of cargoes because a lot of clients went to Cotonou, acquired terminals where they were taking these cargoes to and then freighted in by road. So it was a loss to the Federal Government, a big loss. With this directive; a new era is here. It is good for the operators, for NPA, for the industry and for the economy.”