As Shippers’ Council Tackles Containers Deposit Conundrum

One major obstacle to the clearance of container-laden cargoes at the nation’s seaports is the return of empty containers to shipping companies and the refund of the container deposit by shipping companies to importers.

Recently, it was gathered that importers lose approximately N1.7 billion annually on container deposits due to delayed return.

However, lack of transparency, inefficient tracking systems for monitoring container movement, timely returns, and disagreements between clearing agents and shipping companies over container deposits and refunds have played a crucial role in the delay in collecting the deposits.

While the exact figure is difficult to pinpoint due to the various contributing factors, it is clear that Nigeria experiences substantial financial losses related to container deposits annually, thereby having a spiral effect on the nation’s economy.

But, to end this yearly financial loss, the Nigerian Shippers’ Council (NSC) has been at the forefront of ensuring that the yearly loss is halted through an insurance company underwriting the refund of container deposits.

According to the Shippers’ Council, the idea is for consignees to pay a small service charge instead of the typical deposit, ensuring containers are returned to shipping companies within a specific timeframe.

This, the council argued, would avoid the issue of unrefunded deposits and guarantee the return of containers.

To this end, French Shipping Company, CM have removed container deposit requirements from all bookings since May 2025.

According to CMA/CGM, removing the container deposit followed by sustained stakeholder engagements is a significant step toward promoting a more efficient, customer-friendly shipping environment in Nigeria.

The NSC commended this initiative and views it as a milestone in ongoing efforts to reduce trade barriers, enhance compliance, and boost competitiveness at Nigerian ports.

This policy shift is expected to ease shippers’ financial burdens, reduce disputes over refunds, and further drive reforms across the maritime sector.

Removing the container deposit aligns with industry-wide calls for more transparent and cost-effective practices within the port and logistics value chain.

In a formal communication to the council, CMA CGM attributed the decision to valuable customer feedback received over the years. They emphasised that the move aims to streamline operational procedures, simplify logistics, and improve service delivery.

The council encourages other shipping lines in Nigeria to adopt similar customer-focused policies for fairness, transparency, and improved service efficiency.

However, speaking on the development, the former acting national president of the Association of Nigeria Licensed Customs Agents (ANLCA), Dr Kayode Farinto, noted that for over four years, stakeholders have been at loggerheads with the Shippers’ Council over the controversial container deposit system, which he described as exploitative and unjust.

Farinto, who commended the initiative of the midwife by the Shippers’ Council, decried how shipping lines have turned container deposits into a lucrative venture at the expense of Nigerian importers and freight forwarders, stressing that many companies hold on to these deposits for months, using the funds for private gains, withholding interests accruable to the original payers.

Addressing the argument that container deposits are the only incentive for freight forwarders to return empty containers, Farinto disagreed strongly. He argued that a more effective and globally accepted system, Goods in Transit (GIT) insurance, can take its place.

“No shipping company refunds your container deposit within one month. That means they are trading with your money. A freight forwarding company can be asked to provide a GIT insurance that covers a year. If a container is not returned, the insurance company is held responsible. They will know how to get their money back from the forwarder,” Farinto explained.

Also speaking, Mr Festus Ukwu, secretary general of the National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), emphasised that every shipping line operating in Nigeria must establish an empty container depot to manage empty container returns effectively.

He proposed that all discharged containers be returned through a unified container deposit centre, from where they would be loaded onto vessels heading back to their country of origin.

Ukwu also revealed ongoing stakeholder efforts to end the practice of collecting refundable container deposits from importers and freight agents. According to him, a new system involving Insurance is under consideration. According to him, this system would replace cash deposits with an insurance-backed guarantee to ensure containers are returned without financial exploitation.

However, he called on other shipping lines in Nigeria to follow CMA CGM’s example, urging regulators, especially the Nigerian Shippers’ Council, to fast-track the implementation of a new legal framework that bans the imposition of container deposits on Nigerian shippers.

“If it is insured and the container goes back and gets to them, there’s no need to collect container deposits. The truth is, most of the time, these shipping companies don’t return the money. They find one trick or another to exhaust the entire deposit,” Ukwu said.

On his part, the Tin Can chapter public relations officer of the Association of Registered Freight Forwarders of Nigeria (APFFLON), Clinton Okoro, lamented the exploitative practices of some shipping companies, noting that in some cases, excessive demurrage is charged weeks in advance.

Okoro recounted a personal experience in which he had to challenge an inflated bill for 10 containers from a shipping company. He disclosed that some stakeholders have already taken legal action against certain shipping lines, including Mediterranean Shipping Company.

According to him, the Nigerian Shippers’ Council has previously emphasised that container deposit refunds should not exceed four days, or at worst, one week. However, many freight agents still wait months without a refund, with no interest paid on withheld funds.