Nigeria Destination Inspection Scheme

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Nigeria Destination Inspection Scheme

• Presentation to the
• West Africa Trade Transport Seminar
• Thursday 4th May, London
• Sue Keen
• Documentation Manager, Cotecna UK

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Presentation Content

• Outline of DI scheme
• Type of contract
• Who is involved
• How it works from start to finish
• Current issues (as we understand them)
• Form M opening
• Processing of final documentation

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Agencies involved

• Three Scanning and Risk Management Service
  Providers (SCs) have been appointed
• Each SC has a 7 year BOOT contract
• Build Own Operate Transfer
• Each has been allocated specific ports of entry
  (sea, air land) unlike PSI which was determined
  by country of supply

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Agencies involved

• Cotecna
• Seaports Apapa,Tin Can Island
• Airports Kano, Abuja Land Borders Jibiya,
  Banki
• SGS
• Seaports Onne, Port Harcourt
• Airport Port Harcourt Land border Idiroko
• Global Scan Ltd
• Seaports Warri, Calabar
• Airport Ikeja (MMA) Land borders - Seme

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Outline of process

• Exporter raises proforma invoice (PFI) and sends
  to Importer
• Importer raises form M at authorised dealer
  (bank) using PFI and other required documents
  (specific licences, insurance certificate etc)
• Authorised dealer sends the form M and associated
  paperwork to the relevant SC within 5 days of
  opening

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Outline of process

• SC approves or rejects the form M application
  within 1 working day of receipt from authorised
  dealer
• SC returns rejected form Ms to the authorised
  dealer with reason (or reasons) for rejection
• Authorised dealer is responsible for informing
  importer no goods can be imported until the
  form M is approved

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Outline of process

• SC sends details of approved form Ms to
  Customs Headquarters and Customs Area Command at
  the relevant port of entry (sea, air or land)
• Goods shipped - exporter submits final documents
  who to depends on specific details (ie valid
  for forex, personal effects etc)
• Authorised dealer sends final documents to the
  appropriate SC

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Outline of process

• SC checks all final documents received and
  approves if acceptable or rejects if not
  acceptable
• If documents are rejected they are returned to
  the authorised dealer
• It is the authorised dealers responsibility to
  notify the importer and arrange rectification

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Outline of process

• For approved final documents SC generates a
  Risk Assessment Report (RAR)
• Within 5 days for sea shipments
• Within 2 days for air / land shipments
• The RAR includes the SCs opinion on
• customs classification
• valuation
• recommended intervention level

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Possible intervention levels

• Green channel
• No inspection direct release
• Yellow channel
• Scanning by SC responsible for that port of entry
  (sea, air or land)
• Red channel
• 100 physical inspection by Nigeria Customs
  Service

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Image of a scanned container
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Outline of process

• RAR is printed on plain paper
• Customs copy issued to port of entry (sea, air or
  land)
• Importers copy sent to bank
• RAR data is also transmitted by EDT to NSC
  Asycuda system
• Importer collects RAR from their bank and submits
  Customs Entry to NCS

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Outline of process

• NCS assess duties and taxes and any other charges
  payable
• They use the information in the RAR but do not
  have to accept the SCs customs classification or
  valuation
• NCS determines the intervention level they do
  not have to accept the recommendation made by the
  SC

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Outline of process

• Consignment progresses through the chosen
  intervention level once the importer has paid the
  duties taxes to the designated bank
• Green Lane Direct Release
• Release Order (RO) printed by Customs after
  duties taxes paid
• Importer presents RO to Nigeria Ports Authority
  (NPA) pays port charges
• Consignment released

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Outline of process

• Yellow Lane scanning
• Authorisation to Load for Scanning (ALS) issued
  by Customs after payments confirmed
• Container scanned
• If discrepancy container moves to Red Lane
  for full physical inspection by NCS
• If satisfactory RO printed
• Importer presents RO to Nigeria Ports Authority
  (NPA) pays port charges
• Consignment released

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Outline of process

• Red Lane physical inspection
• If discrepancy two options
• NCS may seize the cargo importer loses goods
  which are either destroyed or sold at auction
• NCS issue an Assessment Notice (AN) detailing
  additional duties, taxes and penalties to be paid
• Importers pays additional charges RO printed
• If satisfactory RO printed
• Importer presents RO to Nigeria Ports Authority
  (NPA) pays port charges to NPA
• Consignment released

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Current Issue Form M rejection

• Cotecna rejections
• 1 Jan to 25 Apr 23 of form Ms rejected
• Reasons for rejection are varied
• Some problems stem from the authorised dealer
  others are caused by the importers
• Some are caused by the exporter in the production
  and submission of their proforma invoice

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Reasons for form M rejection

• Authorised dealer
• Late submissions to the SC (after 5 days)
• Not signed, dated, stamped (ie authorised)
• Wrong bank code / numbering or prefix
  (duplicates, too many or too few digits, exempt)
• Other required documents not provided
• For example NAFDAC, NEPA licences SONCAP
  paperwork Insurance Certificates

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Reasons for form M rejection

• Conflicting information where details quoted on
  the form M do not match attached documentation
• Exporter details
• (names, addresses, phone/fax numbers)
• Values (FOB, Freight etc)
• Countries of origin and supply
• Port of entry (sea, air or land)

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Reasons for form M rejection

• Proforma invoices not acceptable
• Full exporter details must be given
• Insufficient description of the goods
• Generic product name brand name where applicable
• Model name or number where applicable
• Description of the quality, grade, specification,
  capacity, size etc
• Other missing information
• Quantity, packaging or packing unit prices
  freight
• Country of Origin and/or supply
• PFI expired (now only valid for 3 months)

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Proforma invoices

• Why do PFIs have to be so detailed?
• This is the only information the SCs have to
  complete price analysis and perform customs
  classification
• Failure to provide this detail may result in
  goods being incorrectly classified and valued
• This in turn may result in an incorrect RAR being
  issued which may delay clearance

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Current issue final documents

• Cotecna rejections
• 1 Jan to 25 Apr 23 rejected
• Reasons for rejection are varied
• CCVOs
• Information inconsistent with form M (currency,
  different exp/imp higher quantities or values)
• Do not add up correctly
• No number or date missing freight values
• Missing or incorrect unit prices quoted

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Current issues final documents

• Transport documents
• Missing completely
• No dates or numbers
• Container information not quoted
• Name of vessel, port of loading and port of
  discharge missing
• Inconsistent with other documentation

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What can exporters do to help?

• Improve the quality of data in proforma invoices
• This will stop the form Ms being rejected
• This will stop delays in L/Cs being opened
• This ensures that goods can be shipped quickly
• Improve the quality of data in final documents
• This will stop the documents being rejected
• This will stop delays in the issuance of the RAR
• This will stop delays to your customer getting
  his goods

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• Thank you