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Shipping Charges: NSC Moves To Recover N1trn From Terminal Operators



By Yusuf Babalola, Lagos

The Nigerian Shippers’ Council (NSC), the country’s certified ports economic regulator, has begun moves to recover over N1 trillion Shipping Line Agency Charges (SLAC) levied and collected illegally from Nigerian shippers by shipping companies.

A competent source in the NSC told LEADERSHIP Weekend that the management of the council had concluded the plans it will adopt in going after the shipping firms and ensure they return money collected as shipping charges since 2006.

“The management of the NSC has concluded plans to commence recovery of the money and a modality has been put in place for the process, including sanctions to be imposed on any shipping firm that refuses to return money it collected in the name of shipping charges.

“At the end of the exercise, a whopping sum of N1 trillion would be raked in for the federal government, which will be very useful in funding the country’s budget for this year”, the source who did not want his name in print stated.

The NSC’s decision to begin the process of recovering the money followed last Tuesday’s judgement of the Court of Appeal sitting in Lagos, which upheld the judgment of a Federal High Court affirming the appointment of the NSC as the Economic Regulator for seaports in Nigeria and its powers to impose charges.

The appellate court dismissed the appeal brought before it by the Seaport Terminal Operators Association of Nigeria (STOAN) challenging the Council’s powers to fix shipping charges.

In a unanimous judgment read by Justice C.N Uwa, the three- man panel of judges upheld the judgment of Justice Ibrahim Buba of the Federal High Court, Lagos and all the reliefs granted therein in favour of the defendants.

Justice Buba had in November 2015 affirmed the appointment of the Nigerian Shippers Council as the Economic Regulator for the Seaports in Nigeria and its powers to impose charges.

He held that the Shipping Line Agency Charges (SLAC) levied and collected from Nigerian shippers by the Shipping Companies since 2006 was illegal and that the shipping companies should account and pay to Nigerian Shippers Council all monies or fees charged and collected since 2006 as SLAC from shippers or users of shipping/ port related services from 2006 to date, which is estimated to be above one trillion naira.

The judge arrived at the decision while delivering judgments in two suits filed by some shipping companies and terminal operators in Nigeria who rushed to the court to challenge the power of the NSC to fix certain shipping charges.

Alraine Shipping Agencies Nigeria Limited and others as well as Apapa Bulk Terminal Limited and others had filed the suits.

But in his landmark judgment, Justice Buba threw out the claims of the shipping companies and terminal operators and ordered them to refund a whopping N1trn, which they had collected in arbitrary charges from shippers.

Pursuant to the appointment of the NSC as the economic regulator of the Nigerian ports by the federal government in February 2014, the NSC issued notices to both the shipping companies and terminal operators to reverse all illegal charges levied on Nigerian shippers.

But the shipping companies and the terminal operators, mostly foreign owned, filed the suits to invalidate the actions of the NSC.

The NSC, represented by Olisa Agbakoba (SAN), had raised and an objection to the suits as well as counter claim.

In the counter claim, the NSC sought a declaration that by virtue of the provisions of Clause 2(a) and (b) of the Memorandum of Understanding between providers and users of shipping/port and related services dated 28th March, 2001, the plaintiffs do not have the powers or rights to unilaterally introduce and impose Shipping Lines Agency Charges (SLAC).

It also sought a declaration that the unilateral introduction and imposition of the SLAC by the plaintiffs and collection of same from shippers or users of shipping/port-related services from 2006 was illegal, ultra vires, and therefore null and void.

By Tuesday’s judgment of the appellate court, shippers in Nigeria who have paid SLAC to the shipping companies beginning from 2006 when the ports were concessioned to them are entitled to a refund.



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