OPINION: Nigeria Custom Valuation Laws and the Misrepresentation by Tokunbo Olubodun

The Nigeria Customs in recent times was blessed with the new CEMA ACT, 2023 and the essence of the new law is to redefine the modus operandi of the Customs in line with the realities of the global community. The ACT provides for a robust reform of the administration and management of Customs and Excise in Nigeria, thereby creating a balance between revenue generation and trade facilitation.

The Nigeria Customs value of goods in the past has been focused on revenue generation with diminutive attention to trade facilitation and consequently it encouraged a whole lot of unwholesome practices in which any proper officer may at will raise a query on the value of transactions arbitrarily and discretionarily. Then we had what was called Nigeria Customs Service Current Value Range Data for General Goods, it was a value check manual endorsed by the management of the Customs which dictates the value of a lot of goods. Apart from the fact that it negates the open market system and trade liberalization, it did not take into account global market dynamics and the attendant constant changes.

The former and unseemly valuation system encouraged countless and counter-productive practises that made the business communities globally to perceive the Nigeria Customs service as one of the most corrupt because the action of officer were not regulated and any proper officer can decide at will what the price of goods should be.

The signing into law of the new CEMA ACT 2023 was a welcome development because it addressed most of the negative vices that has be-deviled the operations of the Customs Service, it has to a very reasonable extent reduced the supreme like nature of personnel of the service, though it is supposed to create a form of relief for the importing community but its yet to achieve that because officers are yet to fully follow through with the implementation.

Regarding customs value section 69 of the CEMA unambiguously spells out the nitty gritty of the issue, it states that the primary basis for the customs value of goods shall be the transaction value, it defined the transaction value as the price payable or paid for the goods when sold for export to the Federal Republic of Nigeria. In addition it asserts that transaction value can be questioned if buyer and seller are related with definition of their relationship in the said section 69 subsection 5 and further recommends that if transaction value is questioned, that of identical goods from unrelated buyer be applied, it emphasised transaction value of identical goods imported about the same time and substantially the same quantity.

Section 70 of the CEMA also emphasised the responsibility of officers in concord with section 69 but submits that when more than one transaction value of identical goods is found the lowest of such value shall be used to determine the customs value of the imported goods.

In practise, officers for reasons best known them queries value of the transaction in which both parties (Exporter and Importer) are related and does same for unrelated parties with the assumption that prices of goods in question must be uniform across board regardless of timing and quantity which is at variance with the provisions of the law.

This write-up is not aimed at maligning any particular character but to crave the indulgence of the management board of the Nigeria customs to properly inform officers the need to allow their sentiment to align with the provisions and position of the law to avoid the double standards of the past and reduce to a reasonable extent unprofessional mode of attending to the business community.

Tokunbo Olubodun, an Historian, Policy Analyst, Project Management Consultant and Director of TOKSCETERA INT'L LIMITED, A Clearing Agency.

He can be reached through

08091771723.

"Disclaimer: The views and opinions expressed here are those of the author, Tokunbo Olubodun and do not necessarily reflect the official policy or position of Legit.ng."

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Source: Legit.ng