The Nigeria Customs Service (NCS) has announced the suspension of the 4% Free-on-Board (FOB) charge on imports, as outlined in Section 18(1)(a) of the Nigeria Customs Service Act (NCSA) 2023. This was revealed in a press statement by the NCS National Public Relations Officer, Assistant Comptroller of Customs, Abdullahi Maiwada, released on February 11.
According to the statement, the suspension follows ongoing consultations with the Minister of Finance and Coordinating Minister of the Economy, Olawale Edun, and other stakeholders. The move is aimed at facilitating further consultations regarding the implementation framework of the Act.
The NCS clarified that the timing of the suspension coincides with the expiration of the contract agreement with service providers, including Webb Fontaine, which had previously been funded through the 1% Comprehensive Import Supervision Scheme (CISS). Under the previous funding arrangement, the separation of the 1% CISS and 7% cost of collection had caused operational inefficiencies and funding gaps in customs modernization efforts.
The new Act addresses these issues by consolidating “not less than 4% of the Free-on-Board value of imports,” which is intended to provide sustainable funding for key customs operations and modernization projects. The suspension period will allow for more comprehensive stakeholder engagement and help optimize the management of these frameworks to better serve both stakeholders and the nation.
Additionally, the Act empowers the NCS to modernize its operations with various technological advancements. Notable innovations include the development and maintenance of electronic systems for information exchange, as authorized under Section 28 of the NCSA 2023. The NCS has already begun implementing several digital solutions, such as the recently introduced B’Odogwu clearance system, which has improved clearance times and transparency for stakeholders.
Other solutions authorized by the Act include Single Window implementation (Section 33), risk management systems (Section 32), non-intrusive inspection equipment (Section 59), and electronic data exchange facilities (Section 33(3)).
The suspension will provide the NCS with the opportunity to further engage stakeholders while ensuring the proper alignment of the Act’s provisions for sustainable funding of these modernization efforts. The NCS remains committed to implementing the Act in a way that supports stakeholders and fulfills its revenue generation and trade facilitation mandate.
A revised implementation timeline will be communicated after the conclusion of stakeholder consultations.
