Mandatory And Voluntary Product Standard – The National Practices By The Standard Organization Of Nigeria (SON)

mms plus October 13, 2014 COMMENTARY 2 Comments 3,734 Views

– By Dr. Eugene Nweke

Mandatory And Voluntary Product Standard – The National Practices By The Standard Organization Of Nigeria (SON) — Eugene Nweke

Preamble: The recent spates of news making wave within the port industries on the activities of the Standard Organisation of Nigeria, has draw my attention on the need to discuss product standardization practice, hence, my resolve to consult notes and visit the internet, with the mindset to offer a better understanding to both the general public and trading public in particular. As usual, my column shall cover series with statistic and references to give clarity to this modest.

First, it has been noted that; countries often require imported products to conform to the mandatory standards they have adopted for the protection of the health and safety of their people or for the preservation of their environment.

The Agreement on Technical Barrier to Trade (TBT) provide that such mandatory product standards should not be so applied by countries as to cause unnecessary obstacles to international trade. Furthermore, they should be based on scientific information and evidence.

From the viewpoint of the Agreement, mandatory product standards do not create unnecessary barriers to trade if they are base on internationally agreed standards. Where for geographical, climatic and other reasons, it is not possible for members’ countries on international regulations; they are obliged to published these regulations in draft form to give producers in other countries an opportunity to commend on them. The Agreement also obliges members countries to take such comments into consideration when the standards are finalized, thus countries are taken into adequate account.

Voluntary standards, with which compliance is not mandatory, may also pose problems in international trade if they differ widely from country to country. The Code of Conduct Practice for the Preparation Adoption and Application Standards an integral part of the Agreement on TBT therefore urges countries to use their best endeavours to require national standardizing bodies to use the same principles and rules in preparing and applying voluntary standards as are laid down for mandatory standards.

It is in view of the above curred summary from the WCO publication as captioned above, that it has become imperative to undertake a performance appraisal of the application and Practices of the Agreement on Technical/Barrier to Trade (TBT) by the Standard Organization of Nigeria (SON)

The Confessions of Dr. JOSEPH ODUMODU, DG, SON

For reviewal purposes, it will suffice to note down some of the official confessions made by Dr. Joseph Odumodu, the Director General of Standard Organisation of Nigeria (SON) in his passionate interviews on Punch Newspaper of October 4, 2014, Vol. 7247, on Page 42 and 43.

This modest tends to use these confessions by Dr. Odumodu to open-up issues and set an agenda for further enlightment. On the ideal voluntary/mandatory standard practices’

1.”The influx of substandard products in the country was slowly killing the nation’s economy”.

”I am responsible and I take responsibility for the statement too. It was a statement borne out of, sometimes, frustration. I joined SON in February 2011 and one of the things I did when I started was to do a baseline study, and our study revealed that almost all the market segments in Nigeria, such as building construction, electrical, electronics, baby toys, etc have a preponderance of substandard products up to about 80 per cent and above: no particular segment was spared”.

”Study also showed that most of these products were coming from China and related countries, so, it wasn’t really as if we didn’t know what was wrong or the problem was. I went to China, we spoke with their people but I found out that there was reluctance on their part to cooperate with me in solving the problem because they are earning from it. Rather, the feedback I got was that our people come to them to request for substandard product and they oblige because they are businessmen. But they make something they know that people cannot use in their own country, and send them to our own country? In that same year, we were able to bring the level of standard products down to about 50 per cent from about 85 percent. Then, there was a government pronouncement that we should leave the ports. Since then, we introduced newer products like the electronics products registration but they have not effectively brought the figure down to a level that we want to achieve. But as I said, that statement was made out of frustration”.

4.”I realized that to deal with the Chinese, you needed to involve government at the high level. It’s not something I could do alone. I could talk to my colleague in China but at the end of the day, it is a bilateral thing at the highest level of government, which is one thing I am pushing for at this time because we need to be able to check this. Now we are creating a database through our electronics products registration. We have posted our people to the markets, so major markets have SON people in them. This is because at the end of the day, every product that comes into Nigeria must find its place in the markets to be sold effectively, even if you are not at the port, Our people are there taking database. The reason why we are doing that is ultimately for the bilateral agreement to help us to get those countries to backlist manufacturer that are found wanting. Unfortunately, we have not achieved that up till now”.

5.”When I was invited to make a presentation to the Economic Management Team, chaired by the President, I explained to them that my job is like being asked to fight a lion but my hands are chained at the back. It won’t work, but we can only try. People know what they do, either in Alaba market or Computer Village or anywhere else, have been doing it for many years, so when I came and said we must change, they said ‘change to where’. These are people who come from where I come from, and so it’s often more difficult because if you do something against an Igbo man, he takes it personal. Before you know it, it becomes an issue with Odumodu, not the DG, SON. I also know the risk I’m running in doing that, so we don’t use a strong and tactics, we won’t succeed”.

FOOT NOTES:

From the above confessions, the right views and questions to be deduced from the Director General of Standard Organization of Nigeria confessions is to reask again whether he is subtly seems to have admitted as follows:

a). That the Federal Government has not given the agency the required support to discharge

It’s regulatory obligation to the Nigerian Populace, hence, he posited that he is like a lion sent to go and fight but with his hands being chained behind.

b). That he understands his agency’s weakness, knows and identified that, the substandard products litering the Nigeria Markets comes from China, but lacks the regulatory powers to securing a bilateral trade agreement with the Chinesse government, invariable resorting to fate and alternatively accepting compromises.

c). That his agency administrative failure and inability to firmly discharge its obligatory mandates is responsible for the slowly killing of the Nigerian Economy and the untimely death of so many Nigerians, implying that the Federal Government is insensitive to the plight of the people, also underscoring the fact that the Federal Government generally lacks regulatory abilities to control investors.

d). That the National Legislatures should consider laws that will give room for the creation of Private Quality Standard Accreditators to operate side by side with, as recommended in the agreement on Technical Barrier to Trade (TBT).

e). That the influx of substandard product has rendered our manufacturing sectors uncompetitive and ineffective, thereby hampering on Job creations and employement.

f). That the solution to ending the influx of substandard product into our Country is national decisiveness known as ‘strategic protectionism’ and not lax bilateral agreements.

g). That his greatest albatross are his kinsmen as far as the fight against the influx of substandard product is concerned.

Recall that the Standard Organisation was enacted since 1971 under the regime of General Yakubu Gowon ( Rtd). Till date the agencies work force is less than 2000 Staffs. The Agencies is expected to have a liaison officer housed at the nations foreign embassies especially, in all Nigeria Trading Partner international markets.

THE AGREEMENT ON TECHNICAL BARRIER TO TRADE – TBT: –

A Glance into its Provisions.

At this junction, these modest, shall undertake to a comparative note from the stand point of the global industry practices as enshrined in international Agreements and relevant Protocols to underscore the peculiarities in the Nigeria national product standardization practices as undertaken by the Standard Organisation of Nigeria (SON). These comparative notes (agreements) shall be highlighted side by side with the inherrent imports and trade practices within our trade – port environments, as such, for emphasis sake, it is important to note that;

“International rules on the application of mandatory standards (which are also called Technical Regulations) ARE CONTAINED IN THE Agreement on Technical Barriers to Trade (TBT) the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS) lay downs rules and applying SPS measures. The basic claim aim of the detailed rules and guidelines of two Agreements is to ensure that technical, sanitary and phytosanitary regulations are not formulated and applied by countries so as to create unnecessary obstacles to trade”.

The main organization developing international standard applicable to industrial products are as follows:

International Organization for Standardization (ISO);

International Electronical Commission (IEC);

International Telecommunication Union (ITU); and Codex Alimentarius Commission.

It is worthwhile to visit the following Provisions of this Agreement offer and observe a ‘foot notes’ there after, so as to highlight the obvious.

(1) Re-examining the Role of Standard

The standard agency has a duty to protect the health and ensures the safety of its population and to conserve the environment, wherefore, compliance with standards imposed by regulatory agencies is obligatory.

However, the Agreement on TBT requires mandatory product standards to be applied on a non-discriminatory basis to imported product. The role of standards can be reviewed from a general approach and in trade promotion concept:

Standards permeate all business activities and even the day-to-day life of the man on the street. They play an important role in the manufacturing and service industries and in the sale of their product in national and international markets.
One of the characteristics of modern manufacturing is that manufacturing enterprises do not themselves produce all the parts and components they need situated in far-off countries. The standardization of parts and component gives enterprises a wider chance of lower-cost supplies. It also enables them to maintain inventories at comparatively low-levels and give them the flexibility to use substitute component on the assembly line. Standards thus help industries to cut cost and improve productive efficiency.
Standards are indispensable for the international marketing of products as they convey consistent and understandable information to the buyer. A foreign buyer who knows the standards to which a product is produced has an insight into its specifications and is able to assess its quality. Standards thus help reduce disputes over specification and the quality of goods and service exported and imported in and out of the country.

FOOTS NOTES:

It cannot be proven whether SON is using its chronicle of charges as discriminative mechanism against imported products. By initially accepting any standard by a shipper provided such product standard is boldly indicated on the product and not the national regulator standard, as canvassed by the former Director General seems to be part of SON general approach and trade promotion concept.

SON has officially noted that ‘‘the influx of sub-standard products is killing our economy’’ but SON has informed the Nigerian public and the government of the consequences of substandard products on the day to day life of the ordinary Nigerian on the street, it lacks an effective investigation department to investigate and provide a statistical data on how many Nigerians have lost their lives and not just properties as a result of substandard products imported into the country on yearly basis.

It is surprising that for so many years past, SON has never published for the national consumption the statistical breakdown of the total substandard products imported into the country on product by product basis.

It beats the imagination of patriotic Nigerians as to why regulatory compliance on product quality is compromised from the onset. While the agency is commended at least for its regulatory standards efforts (MANCAP) on locally manufactured products, the government is encouraged to look into the activities of SON and invest positively as well as taking SON strategic relevance in the economic development and safety of the populace sensitivity.

c. (2) In Promoting Trade

While standard facilitate international trade transactions by enabling foreign buyers to assess the specifications and the quality of products offered for sale, they can become barriers to trade if they differ widely from country to country. Buyers generally are reluctant to purchase goods that are based on standards that differ from those of their own country. Manufacturers wishing to carry out manufacturing operations in other countries may therefore have to adjust their production processes to those countries’ specifications. This increases tooling cost and prevent producers from taking advantage of their products and are subjected to stricter tests or higher fees than those required for domestic products.

The solution to these problems lie in harmonizing standards at the international level and in developing guidelines for determining conformity to standards. Work in these two areas in all sectors of industry and technology is being carried out by international standardization organizations.

In addition to collecting Customs duties on imported goods, countries require that such goods should conform to the mandatory quality health and safety standards applicable to like products produced domestically.

The numbers of technical regulations laying down mandatory standards is steadily increasing in most countries. The trend is the response of governmental regulatory authorities to growing public demand that products marketed should meet minimum quality and safety standards, and not have any adverse impact on the health of the consuming public and on the environment.

Though such regulations are adopted by countries to attain legitimate policy objectives, they could in practice be used to provide disguised protection to domestic products.

FOOTS NOTES:

SON should formulate its conformity assessment and other related trade programmes and administration with trade altitude to create an enabling competitive environment and to regulate the facilitation of trade.

SON is hereby once again urged to rise up to the occasion by addressing the public demand that products marketed and sold in our markets should meet minimum quality and safety standard and not have any adverse impact on the health of the consuming public and the environment.

c. (3). Definition/Clarifications:

(i) Technical Regulations and Standards

As noted earlier, the international rules applicable to product standards used in the trade in goods and the procedures used for assessing conformity with such standards are contained in the ~Agreement on TBT. The Agreement uses the term ‘technical regulations’ to cover standards with which compliance is mandatory. The term ‘standard’ is used to cover standards used on a voluntary basis.

Both terms cover:

· Product characteristic including those in relation to quality;

· Process and production methods (PPMs) that have an effect on product characteristics;

· Terminology and symbols; and

· Packaging and labelling requirement as they apply to the product.

The rules of the Agreement apply to process and production methods only if these methods have an effect on the quality or other characteristics of produce. Other processes and production methods are not covered by the provisions of the Agreement on TBT.

C.3. (ii). Distinction between products standards and PPM standards

Product standards define product characteristics, or the product’s quality, design or performance. They need to distinguish from standard applied before and during the production stage, i.e before the product is placed on the market.

The provision of the Agreement on TBT apply primarily to product standards, they do not cover PPM standards, except when the production process or method used has an effect on product quality.

INSTANCES:

Let us assume that a prohibit imports of pharmaceuticals from country B. On the grounds that country B has failed to meet its requirements for proper manufacturing practice and plant cleanliness, thereby affecting product quality. In this case the PPM standard is covered by the TBT Agreement and country A can justify its action if it can establish that its production and processing requirements have an impact on product quality.

Now assuming that country A prohibits imports of steel on the grounds that pollution standards at the steel plant in country B are much lower than those enforced by country A. In this case, no environmental damage is done to the importing country; country A’s process standard would therefore not be covered by the Agreement and its prohibition on imports would not be justified.

FOOT NOTES:

As noted above, the Standards Organization of Nigeria, apart from being encouraged to intensify efforts in its enlightenment programmes, the Organization should set up a ” SON Trade Information Desk” (STID) -in all the International Markets across the Nation, taking a clue from the Nigeria Customs Service Trade Hub information Centers situated at the heart of the International trade centers and is still consolidating on it. Reason being that; the essential ingredients in responsible partnership or collaboration is transparency, while Transparency in the context of compliance entails strategic reaching out.

It is expected that information in relation to; “Technical Regulation” covering standards with which compliance is mandatory and that covering standards which is used on voluntary basis; products characteristics; etc should be published, hosted on the website, printed as a flyer and circulated freely cut across all Trading Centre’s , Chambers of Commerce within and outside.

As part of its sensitization efforts, the Standards Organisation of Nigeria should organize and maintain a monthly Zonal “Town Hall Meetings” with the Trading Public and not limiting it only to the Manufacturing Associations as the case may be.

Essentially, the proposed Town Hall Meeting will feature mostly, information on products regulatory, compliance, procedures, offense, etc related issues.

As a mark of responsible partnership the Organisation should improve on its Customer service relation not withstanding its umpire structures because international trade environment revolves more around flexibility and less rigidity in this regards rather treating the so called informal sectors as inconsequential, they should be seen as core investors and treated as responsible partners in progress, hence, their positive contributions towards the growth of our GDP.

The Organisation stands to achieve more, if it evolves the concept of propagating its gospel of compliance with an attitude of converting the unrepentful and uninformed traders via strategic sensitization and responsible partnership. With effective mobilization and sensitization the Organisation will win and actualize its products quality standards quest.

c.3 (iii). Conformity Assessment

The usefulness of standards in facilitating international trade depends greatly on how far the buyer has confidence in the manufacturer’s statement that the product meets a particular standard. For most of the products entering international trade, buyers generally rely on the manufacturer’s declaration

FOOT NOTES:

‘‘SONCAP’’ was intended to achieve the feat; but the truth is that both the Standard Organisation of Nigeria (SON) and the trading public do not rely on the manufacturers declaration, because its glaring that the product by mere seeing and founding are substandard as such except for company practice no sane or right thinking manufacturer will offer unverifiable statement on such products, when in the first instance the manufacturer is not even ISO duo certified.

Therefore, SONCAP only seems to offer a trader a product registration opportunity and to indicate the low quality it met not necessary meeting the national regulatory or particular standard per say.

This justifies the reasons why most product markets having SONCAP registration number and certification are grossly substandard. Therefore, SONCAP seems to service mostly as a revenue tool for the Standards Organisation of Nigeria (SON) and in reality has created and becomes technical carrier to trade.

c. 3 (iv). Quality Management Systems

The third form of conformity assurance is assessment by a third party of the producer’s quality management system. while testing and certification aim at evaluating the quality of the products themselves, the assessment of the quality assurance system by a third party aims at assuring the purchaser that the manufacturer has in place a viable and effective system that is capable of producing product of consistent quality with little or no variation. It is a production management tool for controlling and monitoring variables in the manufacturing process that lead to product defects.

The best known quality assurance system is the ISO 9000 series of standards. Developed by ISO, the system emphasizes that the maintenance of consistent product quality is possible only if it is acknowledged as important management responsibility. It further lays down the documentation procedures and records that a company should maintain in order to demonstrate to, and assure its clients and purchase that adequate attention is being paid to the maintenance of the quality system. ISO 9000 also provides guidelines for training, the statistical monitoring of results and continuous improvement.

Registration or certification of an enterprise to ISO 9000 is granted after an assessment is made by an independent third party that the system in place meets all requirements. Subsequent periodic audits are made to ensure that the company continues to operate in accordance with the system.

Purchasing companies all over the world are increasingly given reference to suppliers registered to ISO 9000 for their raw materials, parts and components. Regulations in many countries oblige government purchasing agencies to obtain the requirements from such companies.

FOOT NOTE:

It is practically most administrative convenience and effective for the Standards Organisation of Nigeria (SON) to put in place ISO 9000 administrative verification and confirmation procedures as the first step towards guaranteeing the product quality assurance to serve as testification, further support and proof of the manufacturer products ‘quality statement assurance# whereby, as a practice such product will bear the endorsement of the manufacturers ISO 9000 number on it.

The Standards Organisation of Nigeria (SON) at this stage of its administrative existence should be able to evolve a process that will promote the classification /registration of the local manufacturers with ISO 9000 compliance.

Perhaps, the poor exportation of finished products outside the shores of Nigeria may be responsible for the administrative lax in ISO – 9000.

Again, the production process and best practice of most foreign and indigenous manufacturing firms in the country are nothing less than poor and now compliance to industrial production process – otherwise known as the quality management systems.

Accreditation Procedures

Accreditators are generally by professional bodies or association of industries in the private sector. In a number of countries, however, the right to accredit is granted through legislation to a national standardization body or to a separate body acting jointly with it.

Supplying industries as well as their clients are likely to have confidence in conformity assurance systems if the competence of the testing laboratory product certifier or quality assurance registrar is accredited by an independent technical body. The procedure by which such independent technical entities evaluate and formally acknowledge the competence of the above-mentioned first layer conformity assessment bodies is known as ‘accreditation’.

The basic aim of the Agreement is to ensure that

– Technical regulations and standards including packaging, marking and labelling requirements, and

– Procedure used for assessing conformity with such regulations, requirement and standards

Are not formulated and applied so as to create unnecessary barriers to trade. The agreement assumes that the aim can be attained if countries use, wherever appropriate and possible, international standards in formulating their technical regulations or in developing voluntary national standards.

To provide an incentive to countries to use international standard, the Agreement provides that, where international standards or guidelines or a conformity assessment system has been used as a basis for a technical regulation, it shall be presumed that they do not create unnecessary obstacles to trade. It further urges member countries to participate in the work of international standardization organization, so that international standards are available to products for which they wish to adopt technical regulation in developing voluntary standards. Countries are also urged to participate in the activities of such organization in order to develop international guides and recommendation that can be used in developing national conformity assessment procedures.

FOOT NOTE:

Since this agreement canvassed for the right National Legislatures to grant a national standardization body (like SON) or to a separate body acting jointly with it – it is the candid advise of this modest that the National Assembly should evolve a legislative process that will give birth to private accreditors this will promote trade facilitation and cushion the inefficiency questions of SON as noted by its Director General.

Moreso, that the trading public/manufacturers are gradually losing confidence in the Standards Organisation of Nigeria (SON): product testing laboratory certifier, conformity assurances system or quality assurances registrar.

Rather than using revenue driven enforcement, deploying chronicle of cargoes/levies to enforce conformity compliance, SON is advised to devote much time to evolve and handle it voluntary national standards, while observing international standard in formulating its technical regulations. In this regards prompt international collaboration, partnership and networking should be intensified upon.

The appointment of a pre-shipment inspection agent that specializes in goods classification, valuation and Risk Management level for customs users does not fall within the context of the above suggested partnership, so that the collaboration will not open up our economic doors to capital flight and inflation. Moreso, that it has been observed from the contractual obligation that the pre-shipment inspection agent are to issue conformity assessment report on all the Nigerian sea bound used vehicles, which attract an inspection fee payable by the Nigeria Shippers is indeed a replica of the failed cargo tracking notes (CTN) regime of the Nigeria Port Authority of 2011.

CONCLUSION

The Director General of the Standards Organization of Nigeria is here advised to refrain from the mindset and eliminate from his thoughts that his Kinsmen are his major obstacles to the crusade against the importation of substandard products. The Director General should appreciate his so called Kinsmen as International Businessmen and core investors to the Nigeria economic development project, who are willing to adapt to regulatory provisions provided such provisions are properly and uniformly structured without leaving room for uneven competition or preferential treatments and undue rigidity. Regarding them as a ‘common informal sector people’ all the time, leaves them with the option believing themselves that they are worthless and disregarded by the Government, who is only interested in their taxes only.

Products quality standard regulation requires National might or Political Supports, it’s not enough for the Director General to go to China and ask for their support in the crusade against substandard product exportation to Nigeria, while forgetting that the Chinese themselves are merely maximizing the concept of “Comparative Advantage”, while insisting that, its our traders that ask for the quality they are shipping into our market.

Yet Nigeria is not a banana republic.

On this note therefore, it was expected before now that pursuance to political support the Director General Should have generated statistics on the colossal impact of the influx of substandard products into the economy and on the social and economic well being of Nigerians, then approached the Presidency through the Honorable Minister who will work collaboratively with our High Commissioner in China, so as to evolve and secure a bilateral trade Agreement with China Government. This is achievable with respect to our sovereignty.

The Organization should be effectively transparent in its administrative givings and service driven in relating with the trading public. To this end, its Public Relations department should be accorded prompt support so as to cope effectively with the dynamism of Information dissemination and projections.

The Organisation should as well understand that within the context of international trade parlance the more obstacle or barrier we create in the fluidity of trade goods flow, either by rigid, cumbersome procedures, chronicles of charges or arbitrary fees, levies, etc, the more red tapes trader initiates in the process at the long run, hence, the global quest to eliminate red tapes/trade barriers on the part of all trading parties. Therefore, the need for a simplified, compact or “One Stop Shop” administrative process and procedures should be promoted by the Organization, as well as consolidating its charges, fees, levies and penalties.

Above all, the Federal Government should take the Standards Organization of Nigeria seriously, especially with its strategic regulatory obligation to the improvement of the social, safety, environmental, healthy and economic well being of the citizenry.

Looking at the unapproved trade routes within the length and breathe of our Country in relation to its national function and placement, a staff strength of 20,000 Nigerians gainfully employed in the organization is not too much how much more leaving the organization with less than staff strength of 1500. This is a high point of government insensitivity to the yearnings of the masses.

Finally, this modest is a professional counsel to the SON without prejudice

Dr. Eugene Nweke

References:

WTO document.

Agreement on TBT:

Annex 1.; -Annex 1:3.;- Article 2:1;- 2:2;- 2:4; -2:5;-2:6; -2:9;- Article 4:

Annex 3.Article 5 and Article 6.