Free Trade Zones Law Bans Industrial Strikes For 10 Years, Says Export Authority

The management of the Nigeria Export Processing Zones Authority (NEPZA) has reaffirmed that its law enforces a 10-year ban on industrial strikes and lockouts in the Free Trade Zones.

The managing director of NEPZA, Dr Olufemi Ogunyemi, clarified in Abuja following “frequent and excessive external union interferences” that have disrupted the smooth operations of the Dangote Refinery.

Recall that the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) had shut down critical oil and gas facilities last week over allegations that the Dangote Refinery had dismissed 800 workers who joined the union.

However, the refinery maintained that it only dismissed a few workers allegedly sabotaging the facility, describing the action as part of its ongoing reorganisation.

Meanwhile, in a press statement by Martins Odeh, Head, Corporate Communications, NEPZA, Dr Ogunyemi stated that the recent escalation of the trade dispute between the Zone and PENGASSAN, particularly considering the refinery’s status as a Free Trade Zone, was worrisome.

He added that the trade union should have channelled its concerns through NEPZA, as required by law, noting that the Authority operates a one-stop-shop administrative model to fast-track processes.

“Section 18(5) of the Nigeria Export Processing Zones (NEPZA) Act provides that there shall be no strikes or lockouts for a period of ten years following the commencement of operations within a Zone, and the Authority shall resolve any trade dispute arising within a Zone,” he said.

According to him, the above provision imposes a 10-year prohibition on strikes and lockouts within Free Zones while still allowing workers to join or form trade unions and engage in collective bargaining.

“We are pleased that the conflict has been de-escalated. Dangote Refinery is a designated FTZ that continues to benefit from tax incentives and customs duty waivers to support the economy, and NEPZA regulates it.

“The Free Trade Zone scheme in Nigeria is slightly over 30 years old, and we ought to be familiar with the scheme and the global rules that guide the operation of this economic model, which aims to accelerate economic development and industrialisation.

“The NEPZA Act requires us, along with all instruments of corporate governance within the industry, government agencies, and relevant sectoral and specialised bodies, to honour the Authority’s one-stop-shop status in overseeing the scheme,” Dr Ogunyemi said.

Dr Ogunyemi further reiterated that trade disputes originating within a Zone must be referred to the Zone Authority for resolution, adding that this restriction applied exclusively within the Free Zones and did not extend to the wider Nigerian economy.

The NEPZA chief executive also pointed out that Section 24(1) of the Act limits the extent to which external laws can interact with operations within the scheme, noting that laws applicable in the customs territory can only operate within Free Zones insofar as they are not inconsistent with the NEPZA Act.

“Consequently, in cases of conflict between the Trade Unions Act (TUA) or Trade Disputes Act (TDA) and Section 18(5), the provisions of Section 18(5) take precedence as the more specific regulation governing Free Zones,” he explained.

Therefore, he expressed the Authority’s appreciation for President Bola Ahmed Tinubu’s swift action to de-escalate the dispute, a clear demonstration of safeguarding a national asset.