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January 26, 2022
National News

Proposed Custom Service Reform Bill Will Cripple Free Trade Zones – NEPZA

By Matthew Ayoola

Nigeria Export Processing Zones Authority, NEPZA, has opposed some sections of the proposed Custom Service reform bill, citing three reasons why amendment to give the Customs Service powers to make regulations in Free Trade Zones will weaken and subvert Nigeria’s Special Economic Zones.

In a submission at the ongoing public hearing on the Custom reform bill at the House of Representatives, NEPZA said “Free Trade Zones are areas designated by the President to serve as one-stop-shop investment hub where incentives are provided in form of tax holidays, simplified Customs and Immigration processes, amongst others, with a view to attracting investors.

“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 noted.

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

The Authority in its response also held that the development if not nipped in the bud would result in either multiple regulations that might be contradictory thereby creating avoidable legal tussles or make registration of enterprises unnecessarily cumbersome and unattractive.

It further submitted that: the proposed sections of the bill which seeks to make the Free Zones Customs- Controlled Zones invariably seek to create antithetical Free Trade 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 through the operations of the free zones contributed tremendously to the national economy, noting that the Lekki Free Zone Quadrant that comprised Lekki Free Trade Zone, Lagos Free Zone, Dangote Free Zone Enterprises, the Alaro City Free Zone, the Calabar Free Zone and the Kano Free Zone were alluring testaments of how it continued to fast track the country’s Industrialisation.

NEPZA, has in the response, 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.

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.

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