POF: When Money Tears The House Apart

• Amaechi's Alleged Impunity

Send by email
Minister of Transportation, Rotimi Amaechi

 

What some clearing agents describe as a misguided directive by the Transportation Minister on the Practitioners' Operating Fee (POF) has once again exhumed past animosities, pitching freight forwarding associations on one hand against the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) over who gets what from the collection. Okey Ibeke writes that the confusion, wrangling and tussle that ought to have been settled by now for the benefit of the sub-sector are rather being exacerbated, with additional reports from Gloria Ehiaghe.

Freight forwarders operating across the country, their regulatory body- the  Council for the Regulation of Freight Forwarding in Nigeria (CRFFN)- and the Minister of Transportation, Rotimi Amaechi, are currently embroiled in fierce war over the collection and sharing of money called the Practitioners' Operating Fee (POF). The war is so fierce and intense that the heat is being felt not only at the ports and border stations, but also in Abuja and many court rooms of the nation's judiciary.  How did this war start and who are the major gladiators?

On July 5, 2017, Rotimi Amaechi, the Minister of Transportation, issued a directive to all freight forwarding groups announcing the approval and commencement date of collection of the controversial practitioners' operating fees.  In the letter which conveyed the approval, the Minister directed them to add operating fees to their charges of cargo clearing and that defaulters would face stiff penalties.

Going further, he ordered that collection of the controversial POF should commence from August 1, 2017 and that the election into the governing board of the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) be held by September 23.

Considering the sensitivity of the POF and the rancour the collection has generated so far, stakeholders have said, a responsible minister ought to have explored ways to settle matters first before issuing out directives from the comfort of his office in Abuja.

Expressing concern on what the minister's motive might be, Prince Olayiwola Shittu, National President of the Association of Nigerian Customs Licensed Agents (ANLCA) reminded the minister that presently, the CRFFN has no governing board and this issue must be trashed out first.

Secondly, going ahead with the collection of the POF will add to the huge burden licensed agents face following the numerous fees they pay yearly before being allowed to operate in the ports.  POF will add to the cost of doing business in Nigeria, a burden that will be transferred eventually to consumers of imported goods. The fees, Shittu stated, include the License Renewal (N215, 000), Nigerian Ports Authority License Renewal (N6,000), Customs Command Operating Fee (N15,000), Bank Change for Customs Bond (N52,500), and CRFFN Annual Payment (N70,000).

To press home their rejection of Amaechi's directive, the ANLCA on 7th August 2017, after six days of the supposed commencement date for the collection of the fee, mobilized its members to embark on protest against the directive.

They described the order as tyrannical, unacceptable and a display of impunity. The protest which began from the ANLCA Secretariat at the National area of Tincan Port, took them to the offices of the Nigeria Customs Service as well as all the terminals at the seaport. As stated by Mr. Akande Balogun who led the protest, the association was bent on resisting the collection of the POF.

ANLCA's position is that only a well constituted Governing Council of CRFFN has the power to determine fees to be collected and not the Minister of Transportation, Hon. Chibuike Rotimi Amaechi or the Registrar of CRFFN, Sir Mike Jukwe.

Before the scenario, the ANLCA chief recalled that the association had written to the Minister of Transportation raising the alarm over the whereabouts of over N5 billion that had accrued to CRFFN as budgetary allocations since 2011/2012 when the Council's Governing Board was dissolved.

PIX 1: Sir Mike Jukwe, Registrar of CRFFN

In the letter dated 14th July, 2017, ANLCA had stated that: “We believe election into the Governing Board of CRFFN should be held and the Board inaugurated to determine the fate of the Practitioners' Operating Fees and resolve some other issues, and not the other way round. Despite the absence of a Governing Board for several years, CRFFN has been receiving budgetary allocations yearly through the Federal Ministry of Transportation, without recourse to accountability.” The letter was in response to the ban the minister had earlier placed on the POF collection.

PIX 2

 Adding a fresh angle to the dispute, ANLCA spokesman, Kayode Farinto, explained that budgetary allocations to the CRFFN became public only when the administration of President Mohammadu Buhari came into being. “In 2016, the CRFFN was given budgetary allocation of about N700million. In 2017, it rose to about N3billion. Before 2015, we did not even know how much the Council got, or how it was spent. But when a new government took over power in 2015, subsequent budgets were made public.   

All these became known following the transparency mantra of the new administration. That was how we got to know that the CRFFN had been collecting budgetary allocations through the Federal Ministry of Transportation even without a governing board. If not for divine intervention, we wouldn't have known there is a budget for the CRFFN”.

The Governing Board of the CRFFN was dissolved in 2012. Ever since then, the Registrar of the Council, Mr Mike Jukwe, has been in charge of its affairs. The Council, as alleged, has been collecting budgetary allocations since then.

“That is why ANLCA wrote to the Minister of Transportation, Rotimi Amaechi to halt collection of the POF and address other issues such as the whereabouts of the CRFFN budgetary allocations since 2012. What has it been used for?” Farinto queried.

Farinto said that ANLCA's position is clear: it is governing board election, amendment of the Act and then POF, not the other way round. “Those who are regularly ferried to Abuja to cook up stories for the ministry of transportation for survival would have saved the Registrar such funds so that election can be conducted. Suggesting electoral timetable without guideline is a pointer to deceit. The non-gazette of agreement reached for a percentage the declarant is entitled to, is a betrayal”, he insisted.

Similarly, the President, National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Mr. Lucky Amiwero said he had earlier written to the Acting President, Prof. Yemi Osinbajo, protesting NPA's inclusion of the CRFFN registration as a yardstick for freight forwarders to be issued with port pass. Quoting some sections of the CEMA Act, Awimero said the power of the minister as contained in section 5-(1) specifically states: “The Minister may give to the Council direction of general character which limits the function of the minister to only when the Council is in place”. Section 5-(2) clearly states that prior to giving a direction under section (1) of this section, “the Minster shall serve a copy of the proposed directive on the Council and afford the Council opportunity of making representations to him.

As provided in section 5-(1) 7(2), he implies, the Minister cannot interfere in the affairs of the Council without a properly- constituted Council elected under the provisions of section 2.  Amiwero recalled that the Council ceased to exist since November 2012 and wonders why the Minister should issue a directive concerning an expired Council whose fate was decided by a high court and a letter from the Secretary to the Federal Government which houses the decision-making body of the Federal Government of Nigeria.

Contrary to the submissions of other major freight forwarding groups, National Association of Government Approved Freight Forwarders (NAGAFF) seems to be solidly behind the minister and his directive on the collection of the fees.

Speaking for NAGAFF, its recently appointed President, Uche Increase, said those that are kicking against the directive are the same people who allegedly collected such monies (the POF) in the past and diverted same into their pockets. He stated that the council needed the POF collection to stay afloat and carry out its statutory responsibilities. He referred to the POF as an issue in the public domain. If government gives a directive through a supervising ministry and somebody or a group is not comfortable with the arrangement, under normal circumstances, freedom of speech allows the person or group to voice out its displeasure, he advised.

“The council needs the POF; those saying it will add to the cost of doing business are just being petty”.

In the same vein, Ben Ndee, factional leader, National Council of Managing Directors of Licensed Customs Agents (NCMDLCA) also endorsed the collection of the POF, noting that his association was comfortable with the take-off date given by the minister for the collection.  “This (POF collection) has lingered for more than three years now.  If we had agreed and accepted it without ANLCA going so violent at Seme Border and scaring the CRFFN registrar out of Lagos, causing the whole thing to be put on hold, this money we are talking about should have amassed for the agents”.

PIX 3: Mr. Lucky Amiwero, President NCMDLCA

Agreeing with Ndee, the President of Association of Registered Freight Forwarders (AREFF), Frank Ukor, called on the associations to halt the lingering bickering and give the CRFFN necessary support and chance to work.

“It is really surprising that those who supported the POF collection earlier, which would have started since 2012 if not for disagreement over sharing formula, are now singing another tune.

“POF collection is not illegal. ANLCA went to court seeking an injunction to restrain CRFFN and others from collecting the money. The court has not granted the injunction”. He maintained that the CRFFN should continue to collect the money according to the Minister's directive and approval pending when the court grants the injunction being requested and declares the POF legal.

 

THE HISTORY OF THE POF

In a February 26, 2015 letter  with reference Number T. 4252/S.46/C.3/1/177, addressed to the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN), then Minister of Transport, Senator Idris  Umar, approved the collection of the Port Operating Fee (POF ).  The federal government went further to gazette the approval after which the CRFFN intensified the sensitization of stakeholders and later issued a public notice for the commencement of the collection with effect from May 11, 2015.

As soon as the date for the commencement of collection was published, crisis started brewing again as before when the same fee under a different name was approved for collection in 2012 but later suspended because of imminent crisis. This time, while four out of the five CRFFN - recognized and registered freight forwarding associations were jubilating and thinking in their minds what they would do with their own share of the money, one of the associations, the oldest and largest, suddenly turned against the collection.

PIX 4: Prince Olayiwola Shittu, (ALCLA President)

At the end of its National Executive Council meeting held on May 14, 2015, four days after the collection of the fee was to commence, the Association of Nigerian Customs Licensed Agents (ANLCA) issued a communiqué directing its members to shun any request by CRFFN to pay the POF. The association went further to set up an eight-member committee to discuss and negotiate with CRFFN and take “all appropriate steps towards the realization of ANLCA's interest.”

Hon. Uche Increase, NAGAFF President

The communiqué said the association supported the actions already taken and those yet to be taken by their members at the international airport chapters who had already resisted collection of the fee by CRFFN. According to CRFFN, this expression of support implied an endorsement of the earlier threat to the safety of the CRFFN Registrar during two sensitization meetings in Lagos on the 28th April and 7th May 2015 by the association's Lagos International Airports Chapter representatives at the meetings. 

Things came to a head on May 19, 2015 when CRFFN officials on sensitization mission were attacked at Seme Border by a mob of estimated 1000 persons. It was alleged that the mob was led by ANLCA Seme Border chairman, Mr Patrick Ozobialu. The CRFFN officials were beaten up, their properties destroyed along with the CRFFN Coaster Bus that took them to the place. Reports had it that some members of rival associations whose support for the fee collection was known were also attacked.

 

REACTION OF OTHER ASSOCIATIONS AND CRFFN

Believing that ANLCA had taken the assault on their collective interest too far and knowing that they could not effectively fight back as individual associations, the other four associations quickly came together to forge a common front with the formation of a new association known as Concerned Accredited Freight Forwarding Associations (CAFFA).  The idea was to give the “renegade” association a run for its money. In a swift reaction, the new association which could best be described as a coalition condemned the May 19 incident at Seme Border and called for tough sanctions against ANLCA. It described the attack as premeditated and based on the directive of ANLCA National Executive Council (NEC) as contained in its communiqué of 14th May, 2015.

The associations reaffirmed their support for CRFFN and the collection of the port operating fee. Urging their members to remain calm and peaceful, the associations canvassed for police protection for CFRRN officials as they collected the fee. The four associations called on CRFFN to enforce the collection of POF immediately and also called for a stop to all collections by ANLCA at the ports and border posts. Stating that the “lawlessness of ANLCA in the ports” be checked to discourage other associations from taking a cue, CAFFA called on CRFFN to urgently deregister ANLC from the register of freight forwarders in line with Section 5 of the CRFFN Act. This was necessary in view of the enormity of flagrant abuse and disrespect for constituted authority of the CRFFN by ANLCA.

“It is our belief that we should nip this act in the bud,” the associations maintained in a memo signed by their then national presidents: Eugene Nweke (NAGAFF), Festus Ejiofor (now late) for the National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), C.A.T. Agubamah, National Association of Freight Forwarders & Consolidators (NAFFAC) and Frank Ukor of the Association of Registered Freight Forwarders of Nigeria (AREFFN).

In his reaction on the controversial directive, the CRFFN Registrar, Mike Jukwe, quipped thus:  “I don't run issues with them (the associations). There is a directive that the POF should be collected from the 1st of August and then the elections would come up in September. So, what else am I going to say when there is a directive from the government?

“On any grievance they have, they can make their representation to the honourable minister. There is no need quarrelling on the passages of newspapers or wherever.  If they have any reservations, they can get back to him. I have no quarrel with anybody; I'm only carrying out the directive for the government. If they have any issue, it is between them and government.”

On the N5billion fund ANLCA alleged was not accounted for by the council, Jukwe said: “That is not true; they are only being mischievous. That is not true at all.”

He stated that rather than bickering afresh over the POF, adequate funding should be availed to the body to fulfill her mandate. He said that with appropriate funding, there should have been many highly educated freight forwarders who would have changed the face of Nigerian maritime industry. The council, he regrets, had not engaged in capacity building for practitioners to enable them adopt international best practices in freight forwarding.

“With the training programmes put in place by the council, it is expected that the practice of freight forwarding in Nigeria will conform to international standards. The standards are to ensure best practices for the much-needed employment and wealth creation that will ultimately impact positively on national growth,'' Jukwe said.

With discordant tunes trailing the POF for years and the minister's interference unable to make a difference, where lies the fate of CRFFN?

The directive by the minister has failed to answer certain critical questions. Does the minister's directive an affront to court processes and breach of rules of law as alleged by ANLCA?    Does the minister over-reached his authority by directing that the fees be collected in areas that are not under his jurisdiction, like border stations? As the fees are meant to be paid through Remita, has the sharing formula be gazzeted by the government to allay the fears of some clearing agents? Are the terminal operators complying with the ministerial directives?

These and many other questions must be satisfactorily answered before the confusion, contentions, allegations and mistrust that the directive unleashed on the industry would be buried and peace restored.  

As soon as the date for the commencement was published, crisis started brewing again as before when the same fee under a different name was approved for collection in 2012, but letter had to be suspended because of imminent crises.

This time, while two out of the five recognized and registered freight forwarding association by CRFFN were jubilating and thinking in their minds what they would do with their own share of the money, one of the oldest and the largest suddenly turned against the collection.

PIX 5: Nigerian Ports Authority, RoRo Port

The freight forwarding group that is opposing the commencement of the collection is Association of Nigerian Customs Licensed Agents (ANLCA), with a very surprising support from Mr. Lucky Amiwero’s faction of National Council of Managing Directors of Licensed Customs Agents (NCMDLCA).

While other groups see the directive as a welcome development, ANLCA and the Council appear to be questioning the minister’s interest.

Section: