By Kenneth Jukpor
Over the years the freight forwarding sector in Nigeria has been in a warzone and the administration of the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN), particularly the collection of Practitioners’ Operating Fees (POF) has been at the heart of the conflict.
The absence of a governing board of CRFFN and unending inter-association fracas ensured that the practice of freight forwarding in the nation remained comatose, characterized by unprofessionalism and corruption.
However, after a decade of doing nothing to make the CRFFN functional the sector reaped the beautiful fruits of nothingness. In fact the situation deteriorated to the point that other players in the shipping sector perceived freight agents as uncultured people.
With the dearth of the professionals and ethics in the practice and growing common challenges, the gladiators decided to give peace a chance, agree on a sharing formula for slots on a new governing board and openly supporting the collection of POF which was promised to empower the CRFFN carry out its core function of training freight agents.
The Presidents of the five associations registered associations not only endorsed the collection of POF but solicited support from their members to enable the operation survive and CRFFN did its part by getting the Ministry of Finance introduce the POF receipts as prerequisite for cargo clearance.
The POF sharing formula is also encouraging and clear as 20% goes to CRFFN, 20% for the technical partners involved in the collection, SW Global, 25% allotted as Internally Generated Revenue for the federal government and 35% for the declarant (freight forwarder).
However, the latest development is that 100 percent of the fund would first go into government’s Treasury Single Account (TSA) and applications would have to be made for any party to access the fund. While CRFFN and SW Global could apply for their percentages, it is unclear as to how freight forwarders or the associations will get theirs.
It is shocking that none of the associations had ironed out how the practitioners would access the 35 percent accruable to them, despite having fifteen members on the governing board of CRFFN. Would the refund be quarterly, monthly or yearly? What will be the procedures or processes to access the fund? Would the associations, freight companies or the individual freight forwarders be the recipients of the fund?
According to the CRFFN Registrar, Barr. Samuel Nwakohu, the government was yet to decide how the freight forwarders would access the monies, however, the technical partners and CRFFN were already clear on how to apply for theirs.
This development has left port stakeholders worried about the sincerity of the government on refunding the 35 percent accruable to the freight forwarder. There are numerous reasons to be perplexed because history shows a similar approach with the Cabotage Vessel Finance Fund (CVFF) established over a decade ago with 2 percent Cabotage levy for local shipping business collected by the Nigerian Maritime Administration and Safety Agency (NIMASA) yet no framework for disbursement up till date.
State governments have also learnt the trick as the Lagos State government under the leadership of Babatunde Fashola introduced the Wharf Landing Fees to generate revenue from the ports with the promise of fixing the overburdened road infrastructure, but the infrastructure received no attention from the government while the collection persists.
If a freight forwarder brings in 100 20ft containers in a month, what would it cost to apply for his 35 percent POF which would be about N35,000? How many freight agents would have the patience and time to chase such seemly paltry fund? Has the government developed a framework that wouldn’t allow freight agents benefit?
These are questions that boggle the minds of several freight forwarders even as the payment of POF commenced last week.
Speaking with MMS Plus on this last week, the Founder, National Association of Government Approved Freight Forwarders (NAGAFF), Dr. Boniface Aniebonam asserted that 100 percent of the fund wouldn’t go to the TSA as the private company SW Global would collect the association’s 35 percent while remitting 65%.
In his response, the President, Association of Nigeria Licensed Customs Agents (ANLCA), Hon. Tony Iju Nwabunike asserted that the current position of the Registrar differed from what they earlier agreed.
According to Nwabunike, the practitioners were meant to believe that while the percentage due to the federal government would go TSA, the funds for the technical partners, freight forwarders and CRFFN would go to a different account from where it would be properly disbursed to parties involved.
The ANLCA boss stressed that he would reach out to the CRFFN Registrar for clarity on the new development.
His words: “As much as we are supporting POF, we need to know the critical aspects of POF and how to handle it. We are going to sit down with the Registrar, the Chairman. Don’t forget that we have fifteen freight forwarders in that Council. All associations are going to come together to solve our problems. We need to streamline this thing but we shouldn’t stop POF collection. Now that it is going on with TSA, it is a good thing because no money is lost. So, we implore everybody to continue to be law abiding freight forwarders and customs brokers until we get that thing sorted out. It is a process and they must move on.”
He stated that ANLCA members agreed to support the POF collection based on the promises they received.
“I want to say that this association agreed totally that CRFFN should collect the POF based on the things they have told us. What did CRFFN tell us? They told us that they are going to train us from the money. That we are going to get the one that will not go to TSA. That they are going to take care of us. That they will take care of our welfare and that they will take care of the associations”, he added.
While the freight forwarding associations nurse hopes that some percent of the POF would be reserved in a separate account, the Managing Director of SW Global, Mr. Abubakar Kuso told MMS Plus that the whole funds would be paid into the TSA.
“All the monies go into the TSA. It is the government that will disburse it after applications have been made for the fund. As the technical service providers we don’t get our percentage until the money goes into TSA. Everybody would have to write an invoice to apply for the fund” Kuso said.
When contacted, the President of NAGAFF who is also a governing board member of CRFFN, Chief Increase Uche opined that only CRFFN could explain how the practitioners would get their monies.
Looking at the plight of freight forwarders with the impending crisis in accessing the POF, one can liken the situation to a typical working class Lagos resident. You wake up at 4:00am, bath, dress up and by 5:00am you’re out to beat the hurdles of the ever growing traffic knowing that every minute wasted, not being on the road, equals at least an additional fifteen minutes in traffic, so you hurry.
While freight forwarders have been quick to support POF only concerned about getting to work early like the average Lagosian, a couple of others are concerned about getting up and out early enough to meet you hurrying, unsuspecting and vulnerable enough to enter their ‘one-chance’ vehicle.
At the bus-stop, you should be concerned about a lot of things, such as; the man standing beside you; ‘what if he’s also going your route?’ how do you outsmart him to get into the bus first? ‘What if he’s a pick-pocket?’ how do you guard your property from theft? You value every minute and with each passing second, your pulse rises. What if you get to work late? You’ve probably received a query recently and have been warned never to repeat your late-coming again or get fired. You see a suspicious vehicle but take the risk regardless, you enter speedily; your job is at stake after all. For every chance missed to board a vehicle, it’s another struggle with hundreds of others going that way, fighting for the limited buses.
This ‘one chance’ vehicle also known as POF collection has moved with the freight forwarders onboard and the doors have been shut.
Oh! Nigerian freight forwarders are confronted with the danger of ‘one chance’ robbery. Who can save them now? Who would blame the victims/ freight forwarders? What will be their fate with the POF regime?