Unchecked Squabbles, Litigations Killing Maritime Industry

Nigerian Port

 

As poor fiscal policies threaten the growth of the maritime sector, the plethora of court cases between the agencies and some key players appear to be adding salt to an injury, thus preventing the sector from contributing as much as expected to the growth of the economy.  Who are the dramatis personae in the various court cases? As the issues persist, what are the implications on the development of a sector whose bountiful potentials ought to be exploited and positioned as alternative revenue source in the face of dwindling fortunes from the oil and gas sector? IZUCHUKWU OZOEMENA writes.

Between the Nigerian Ports Authority (NPA) and private terminal operators, the Nigerian Maritime Administration and Safety Agency (NIMASA) and ship owners, Nigerian Shippers’ Council and Shipping Companies, the National Inland Waterways Authority (NIWA) and the Lagos State government, Maritime Academy, Oron and the Federal Ministry of Transportation, the Nigeria Customs Service and freight forwarders, Nigeria’s maritime industry is locked in an internecine conflict.

PIX: Dakuku Peterside, NIMASA DG

 

Supremacy struggle, protection of special interests and even massaging of egos have combined to stifle the search for a better business environment, scuttling every attempt at innovation and threatening the enforcement of security measures and, more importantly, negating the provision of improved services to users of shipping services.

At the heart of the crisis is the Federal Ministry of Transportation that has failed to provide leadership and evolve a clear policy direction. Rather, the ministry has become a party to most of the conflicts and has had a fair share of its contribution to triggering its own conflict.

PIX: Hadiza Bala Usman, NPA MD

 

Experts are alarmed that while the maritime industry is drifting like a rudderless ship, Nigeria is bearing the brunt of the opportunities being missed as the country seeks to shore up income from the non-oil sector.

 

STOAN, ALSA SLUGGING IT OUT WITH SHIPPERS’ COUNCIL

 

It all started in 2014 as what appeared as a muscle-flexing between the Council on one hand and the Association of Shipping Line Agencies (ALSA) and the Seaport Terminal Operators Association of Nigeria (STOAN) on the other. The bone of contention was storage charges at the ports. Terminal operators had, without consultation, increased storage charges against the requirements of the contract agreement entered into during port concession. The action took place in a surreptitious manner.  When this became public, the Nigerian Shippers’ Council called them to order, reminding them that much as they reserved the right to make such increases, it must be done in agreement with the economic regulator, importers and exporters as well as other interest groups.  

PIX: Princes Vicky Haastup, STOAN Boss

 

On October 29, 2014, the Council published a newspaper advertisement announcing the reversal of storage charges at the ports to what they were as at May 1, 2009.The NSC also ordered an increase in the free storage period at the ports from three to seven days. The organisation which is charged with the responsibility of protecting the interests of shippers equally directed shipping companies to reduce their shipping line agency charges from N26,500 to N23,850 on a 20ft container and from N48,000 to N40,000 on a 40 ft container. It also called for a refund of container deposits by importers and agents within 10 working days after the return of empty containers.

Dissatisfied with the directive, the shipping companies and terminal operators headed to the Federal High Court and instituted an action against the Council. At a point, the Shipping Association of Lagos State (SALS) became involved as an interested party.

In a judgment delivered by Justice Ibrahim Buba on December 17, 2014, the court annulled the illegal port charges and ordered shipping companies to refund billions of naira collected from shippers (importers and exporters) beginning from 2006. The judge affirmed the appointment of NSC as the economic regulator of the ports and dismissed the claims of shipping companies and the terminal operators.

As at today, the matter is still a subject of litigation as rather than accepting this judgment, ALSA and STOAN appealed the judgment.

 

SUPREMACY CONTEST BETWEEN NIWA AND LAGOS OVER WATERWAYS

 

The silent disagreement between the Lagos State government and the Federal Government over the ownership and control of inland waterways in Lagos blew open on November 14, 2013 at the 13th National Council on Transportation held in Lagos. Speaking at the meeting, Babatunde Fashola, the then governor of Lagos State made what observers described as a declaration of ‘war’ when he said the state government would not be bound by some sections of the National Inland Waterways Authority (NIWA) law as these constituted a cog in the wheel of progress of Lagos State in her efforts to develop inland water transportation for the people.

 

“Let us reflect on the role of NIWA as it relates to municipal water transportation services within Lagos city. I find it difficult to believe that I should obtain a permit or license from NIWA before I could build jetties and bridges in Lagos State across the lagoons that would promote water transport. NIWA says we must get its approval to build a bridge that will facilitate water transportation to alleviate the movement of the public. We say no to that”, Fashola fumed.

In line with its Waterways Authority Laws of 2008, the Lagos State government, on August 8, 2017, began the enforcement of its laws on waterways, thus renewing the age-long rivalry with NIWA over the control of its inland waterways. This enforcement was based on an appellate court’s judgment on July 18, 2017, giving full and exclusive control of the bodies of water within the state to Lagos State Waterways Authority (LASWA).

PIX: Governor Akinwunmi Ambode

 

Describing the judgment as a watershed Governor Akinwunmi Ambode said “the judgment is a major success in the quest of the state government to control its resources and enshrine the true spirit of fiscal federalism.

“With the judgment, the era of uncontrolled dredging is over in the state as the state government would take firm control over its inland waterways and the adjoining lands including all sand dredging activities,” Ambode stated.

The government gave all operators on its waterways seven days to fully subject themselves to state government regulation especially in matters of payment of approvals for dredging, boat operation, payment of levies and charges, warning that it would not hesitate to sanction operators who refuse to comply with the extant laws.

PIX: Engr. M. J. Sambo, NIWA Lagos Area Manager

 

But NIWA cautioned that the state should not be “over-excited” on a matter it did not originate. According to the Federal Government agency, the state government needed to come out with the true picture of the said judgment, as it claimed that the judgment was rather in favour of NIWA than the Lagos State government.

In a statement, NIWA’s then Managing Director, Boss Mustapha, said the Court of Appeal only granted Lagos State the power to legislate on intra-state waterways, that is, waterways that originate and end within Lagos State.

“However, such waterways do not exist in Lagos State because all bodies of waterways in Lagos State are either international, tidal, intra-coastal and/or inter-state waterways,” the NIWA boss pointed out.

NIWA further contended that the Court of Appeal retained for the agency the power to regulate international, intra-coastal and inter-state waterways, “being items provided under Articles 36 and 64 of the Exclusive Legislative List of the 1999 Constitution (as amended).”

He said NIWA was also a co-defendant like Lagos State in the matter on which the judgment was given, and not the plaintiff as wrongly painted by the state.

Beside the Court of Appeal judgment, the former NIWA chief noted, there is another subsisting Court of Appeal decision in G. M Ent. Ltd vs C.R. Investment Ltd. reported in (2011) 14 N.W.L.R. part 1266, page 125, where it was held that  NIWA has been conferred with far-reaching powers and right to control, develop, manage and use all the lands, navigable waterways, inland waterways, river ports throughout Nigeria.

“The position, therefore, remains that it is only the Federal Government that can regulate inland waterways, shipping, navigation and dredging activities within the Nigerian Inland Waterways and its Right-of–Ways,” he emphasized.

He told boat operators and dredgers to disregard the latest claims by the Lagos State government, urging them to remain calm and continue to carry on their legitimate businesses as regulated by NIWA.

Mustapha said the agency has filed an appeal against the judgment at the Supreme Court, pending the transmission of the judgment to NIWA, he said Lagos State had nothing to be excited about since the judgment did not change the status quo ante.

But the chairman, Association of Tourists, Boat Operators and Water Transporters of Nigeria (ATBOWATON), Chief Wellington Akingbulu, who claimed that it was his association that took NIWA, NIMASA and LASWA to court over who to pay charges to, said contrary to the Lagos State government’s claim, the ruling was unmistakably in favour of NIWA.

PIX: Emmanuel Damilde, LASWA MD

 

“It is a clear issue and the judiciary has given its judgment. It was ATBOWATON that sued NIMASA, NIWA and LASWA on who to pay tariff to and the Appeal Court gave judgement in favour of NIWA; so, we will continue paying to NIWA. To us nothing has changed,” he said.

“If Lagos can show us any such water that begins and ends in Lagos, that is what the Appeal Court gave judgment over. The judgment was very clear in stating that NIWA still has control over any other kind of water that flows into Lagos and flows out of the state to other states or joined with others into either the lagoon or the Atlantic Ocean’’, Akingbulu concluded.

The key to resolving the logjam lies either in the Supreme Court’s pronouncement, the path which NIWA has taken, or the National Assembly amending the laws which gave it exclusive regulatory rights to the nation’s waters.

Meanwhile, pending the settlement of the case, operators remain uncertain as to who to relate. This is definitely working against the interest of operators and the use of the waterways as viable public transportation channels.

 

POF: AGENTS SUE CRFFN, MINISTER

 

Presently, the Association of Nigerian Licensed Customs Agents (ANLCA) is at loggerheads with the Minister of Transport, Chibuike Rotimi Amaechi, over his directive to the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) to commence the collection of the controversial Practitioners’ Operating Fee (POF) at the nation’s seaports effective August 1, 2017. The battle is still raging.

The association had accused Amaechi of flouting a court order that stopped collection of the controversial professional fee.

ANLCA said the fee would increase the cost of doing business at the ports, and that its collection would amount to violation of an order of a Federal High Court sitting in Lagos directing that the status quo be maintained pending the determination of a case instituted by the association.

“It is contempt of court for the Honourable Minister and the CRFFN Registrar to commence collection of POF. We have been informed that the Minister has sent a letter to terminal operators to collect the fee for CRFFN but we will not hesitate to use any legal backing to stop this illegal collection,” ANLCA said.

Before the stalemate currently trailing the collection came to be, the CRFFN had planned to collect N1,000 per twenty-feet (TEU) and N2,000 per forty-feet (FEU) containers as professional operating fees. It was also set to collect N1,000 per truck load of general cargo, N500 per imported car and N1,000 on other types of imported vehicles.

Importers and agents are expected to bear the additional cost, which could translate to annual revenue of about N10 billion into the coffers of the cash-strapped CRFFN, leaving the final consumers of imported goods to bear the brunt by way of increased cost of goods.

 

MAN ORON, TRANSPORTATION MINISTER IN COURT

 

The controversial appointment of a six-man Interim Management Committee to run the affairs of the Maritime Academy of Nigeria (MAN), Oron, for six months is the subject of a court case at the Federal High Court in Uyo.  Involved in the matter are the Minister of Transportation, Chibuike Amaechi, and the Attorney General of the Federation. Joined in the suit are the Maritime Academy of Nigeria and Chief Adebayo Sarumi sued for and on behalf of the Interim Management Committee which he heads.

The plaintiffs, Mr. Ene Ntang Ene, a candidate who had applied for admission into the National Diploma programme (ND) for the 2017/2018 academic session of the maritime training institution and a youth activist, Mr. Francis Edem Otioro, jointly instituted the suit challenging the legality of the appointment of the Committee. The suit, number FHC/UY/CS//141/2017, was filed on Friday, 13th October, 2017 by Lagos-based legal practitioner and human rights activist, Mr. Inibehe Effiong, on behalf of the plaintiffs. The Court is being approached to determine the legality of the Minister of Transportation or the President appointing an Interim Management Committee to administer, manage, or participate in running the affairs of the Maritime Academy of Nigeria, when the Maritime Academy of Nigeria Act has vested the power to do so solely on the Governing Council and the Rector of the Academy.

Mr. Ene further stated that the Committee suspended the 2017/2018 admission into the National Diploma, Higher National Diploma and Post Graduate Diploma programmes of the institution thus derailing his chances of admission into the Academy. Several documents were attached to the affidavit as exhibits.

PIX: Maritime Academy of Nigeria, Oron

 

Upon resolution of the above question, the plaintiffs are also seeking about nine reliefs from the court.

As the proverbial elephants fight, the grasses suffer. In this case, it is the smooth operation of sectoral activities and, by implication, the economy that bears the brunt.

 

‘THE INDUSTRY IS DRIFTING’

 

“It hurts when you realise that we are in a time of national emergency, yes we are in an economic emergency given the debilitating effect of the prolonged recession, a critical area that should be driving the weaning of the economy from oil is drifting due to failed leadership,” the chief executive of one of the major indigenous shipping companies told Business and Maritime West Africa.

He said the Federal Ministry of Transportation ought to have provided the leadership that will galvanise all stakeholders to articulate a road map for optimising the potentials of the industry.

“When Amaechi opposed the establishment of the Maritime University at Okerenkoko and the government overruled him, it became clear to me that the maritime industry is snookered, as leadership will be a huge challenge. And that is how it has turned out,” the ship owner stated.

The bickering and intrigues among the agencies and stakeholders has gone on unchecked with the supervising ministry even introducing its own dimension with the uncertainty generated by the decisions made on Maritime Academy, Oron. Rather than playing a father-figure role in reconciling all groups, the ministry is now embroiled in its own controversy over run.

In the absence of the desired leadership, the industry has been rudderless in the past two years.

However, stakeholders are calling on the government to take urgent measures and stop the rot. A freight forwarder lamented that the seeming leadership vacuum and lack of support for agencies has been exploited by the foreign shipping community to impose arbitrary fees on shippers. Pointing at the lingering dispute over the surcharge unilaterally imposed by foreign shipping companies, the freight forwarder noted that if the Nigerian Shippers’ Council had the unflinching support of its supervising ministry, it would have been able to rein in the ship owners.

“We need every hand to be on deck now to see how the cost of shipping services can be reduced and more revenue generated there from. This situation where the minister is giving the green light for imposition of Practitioners Operating Fee (POF) under the auspices of the CRFFN is counter-productive. That decision amounts to putting the cart before the horse. We need Amaechi to first restore sanity, law and order in the industry by backing the shippers’ council in its campaign to impose a measure of supervision on private terminal operators and ship owners.

“If he demonstrate government’s resolve to usher in a new order, it will have a ripple effect on the economy,” he stated.

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