Relief For Importers: NCS Suspends Controversial 4% FOB Charge.

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Nigeria’s telecommunications industry faced a major challenge last year, with over 50,000 fiber cuts reported, according to Dr. Aminu Maida, EVC/CEO of NCC. “This is a pivotal moment for the telecommunications industry and its customers. Fiber networks are the foundation of Nigeria’s broadband ecosystem,” Dr. Maida emphasized.

The persistent issue of fiber optic cuts and damages caused by road construction and rehabilitation activities has led to significant disruptions in telecommunications services across Nigeria. To address this challenge, the Federal Ministry of Works (FMoW) and the Federal Ministry of Communications, Innovation, and Digital Economy (FMoCIDE) have established a Joint Standing Committee on the Protection of Fiber Optic Cables.

Dr. Maida noted that the lack of an efficient handshake mechanism between road construction companies and operators of the fiber infrastructure is a key contributor to the increasing number of fiber cuts attributed to road construction activities. “I am optimistic that the work of this committee will lead to a significant reduction in fiber cuts attributed to road construction,” he said.

Engr. Olufunso Adebiyi, Permanent Secretary of FMoW, directed committee members to establish modalities to ensure the reduction of damage to deployed fiber optic cables resulting from road construction and maintenance activities, as well as vandalism. “They are also expected to develop an instant communication mechanism to facilitate prompt communication and dissemination of information amongst all stakeholders,” he said.

Engr. Farouk Yusuf, Permanent Secretary of FMoCIDE, highlighted the significance of fiber optic cables to the country’s economy, stating that fiber networks are the backbone of Nigeria’s digital economy. “The Committee’s work is crucial to ensuring that telecommunication services are not hampered by the work of construction companies,” he said.

In a related development, the Nigeria Customs Service (NCS) has cancelled all import declarations made during the initial implementation period of the four percent free-on-board charge on imports. Abdullahi Maiwada, National Public Relations Officer of the NCS, explained that the measure is necessary to ensure clarity, maintain consistency in customs operations, and prevent any disruptions in clearance processes.

“Sequel to the earlier press release announcing the suspension of the four percent free-on-board charge on imports, the Nigeria Customs Service wishes to inform stakeholders that all import declarations made during the initial implementation period have been cancelled,” Maiwada said. He urged all affected stakeholders to promptly recapture their entries through the designated customs processing platforms.

Maiwada emphasized that the service remains steadfast in its commitment to implementing government fiscal policies in alignment with the provisions of the “Nigeria Customs Service Act 2023 through robust consultation and dialogue with all stakeholders.” He encouraged stakeholders to take advantage of the opportunity to avoid any further delays in the clearance of their consignments.

The NCS had earlier announced the suspension of the implementation of the widely criticised four percent free-on-board value on imports. The amount, as stipulated in Section 18(1)(a) of the Nigeria Customs Service Act 2023, has already raised concerns among businesses struggling with high operating costs.

Maiwada said the suspension presents an opportunity to review the revenue framework holistically. “The suspension of the four percent FOB charge is a welcome development, and we are committed to working with stakeholders to ensure that our revenue framework is fair and equitable,” he said.

The FOB charge, which is calculated based on the value of imported goods, including transportation costs up to the port of loading, means importers will pay more to bring goods into Nigeria, a cost that will likely be passed on to consumers.

Maiwada assured that the NCS is committed to ensuring that the suspension of the FOB charge does not disrupt the clearance process. “We have put in place measures to ensure that the clearance process is seamless, and we urge all stakeholders to cooperate with us to achieve this goal,” he said.

The NCS has also directed customs commands nationwide to provide assistance and clarification to importers and agents requiring support during this period. “We are committed to providing excellent service to our stakeholders, and we will do everything possible to ensure that the clearance process is smooth and efficient,” Maiwada said.

The suspension of the FOB charge has been welcomed by stakeholders, who have been calling for a review of the charge. “We commend the NCS for suspending the FOB charge, and we look forward to working with them to ensure that the revenue framework is fair and equitable,” said a stakeholder who preferred not to be named.

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