•Stakeholders petition Shippers’ Council, Marine Ministry
By Steve Agbota [email protected]
Customs brokers have raised the alarm over the persistent exploitative practices of cargo consolidators in Nigeria, accusing them of levying arbitrary charges and unnecessarily swelling the cost of goods as the consumers bear the brunt of the exploitation.
To this end, they have called on the authorities, especially the Nigerian Shippers’ Council and the Ministry of Marine and Blue Economy to stop the unregulated charges as they are injurious to the economy.
Cargo consolidation, commonly referred to as groupage, involves combining goods from multiple shippers into one container.
However, experts who spoke with Daily Sun described the activities of these cargo consolidators as illegal and exploitative, noting that it goes against normal practices in other maritime jurisdictions.
Today, the nation’s ports are among the most expensive in the world in terms of trade and ease of doing business due to multiple charges and taxes. The cargo consolidators imposing unregulated charges on clearing agents and importers have also contributed to the high cost of doing business at the ports.
Stakeholders lamented that if these arbitrary charges are left unregulated, it would increase the cost of living in the country and negatively impact the nation’s economy.
Speaking with Daily Sun, former Acting President of the Association of Nigerian Licensed Customs Agents (ANLCA), Dr. Kayode Farinto, lamented the arbitrary charges imposed on Nigerians by cargo consolidators in the maritime sector.
He said the unregulated charges would have adverse effects on the nation’s economy, calling on the Nigerian Shippers’ Council (NSC) and the Ministry of Marine and Blue Economy to take decisive action.
Farinto highlighted the exploitative practices of consolidators, particularly the Associated Port and Marine Development Company (APMDC), and their adverse impact on the maritime industry.
He revealed that cargo consolidation, commonly referred to as groupage, involves combining goods from multiple shippers into one container.
While the practice is essential for cost-effective shipping, he noted that some consolidators impose exorbitant and unregulated charges on cargo owners, which he described as extortionate and detrimental to the Nigerian economy.
Using a consignment of an elevator meant for a church project as a case study, Farinto detailed his experience with APMDC.
He said the elevator, occupying 10.6 cubic meters (CBM) in a 20-foot container, incurred consolidation charges amounting to N3,117,368.
He explained that APMDC charged N270,172 per CBM for consolidation, along with additional documentation and VAT charges. Further, the company issued a separate debit note of N438,223 for terminal-related fees, bringing the total charges for the consignment to over N3.5 million, according to documents sighted by Daily Sun.
“These charges are outrageous. For a 20-foot container, even in a standard terminal, you cannot pay more than N1 million for all charges, including terminal fees and shipping costs,” Farinto asserted.
He further criticized the lack of transparency in determining these charges, stating that there should be a standard operating procedure in line with the concession agreement.
“Where do these consolidators get their charges from? Who regulates them? The Nigerian Shippers’ Council is aware of these exploitative practices, yet no concrete action has been taken,” he added.
Farinto also cited a similar case involving Sharafa Shipping, where the company charged N165,220 per CBM for a consolidated consignment, along with separate terminal charges.
He emphasized that these arbitrary charges inflate the overhead costs of imports, which are ultimately passed on to Nigerian consumers.
Meanwhile, he called on the Nigerian Shippers’ Council, as the economic regulator, to protect Nigerian shippers by addressing the issue of arbitrary charges.
He demanded sanctions against APMDC for alleged exploitation of shippers and failing to communicate effectively with clients during a prolonged closure of its terminal by the Nigerian Customs Service over alleged infractions.
“The closure of the terminal affected numerous project cargoes, including the elevator meant for a church project, which could not be installed on time due to the delay. Yet, APMDC did not apologize or offer explanations to its clients. Instead, they continued to impose illegal charges,” Farinto lamented.
He also warned shippers and importers to be cautious when engaging cargo consolidators, urging them to verify the credibility of terminal operators and shipping companies.
He further highlighted the importance of addressing these issues to ensure the success of the African Continental Free Trade Agreement (AfCFTA), where the role of cargo consolidators will be critical.
He urged the Ministry of Marine and Blue Economy to intervene and prevent these exploitative practices from becoming a systemic menace in Nigeria’s maritime sector.
“We must act now to protect importers and ensure that cargo consolidation serves its intended purpose of reducing costs rather than becoming a tool for exploitation,” he stated.
Meanwhile, the National President of the National Council of Managing Director of Licensed Customs Agents (NCMDLCA), Lucky Amiwero, said clearing agents are correct about the activities of the cargo consolidators.
“The problem is that, who is a cargo consolidator? A consolidator is the one that receives cargo. You have a container, you collect small cargoes from different people, and consolidate it into one container and ship it. These cargo consolidators must be regulated,” he said.
According to him, it depends on the technical competence of the Shippers’ Council to regulate them because the work of cargo consolidators is to consolidate cargo.
“When they consolidate, they overcharge. I regulated those things in those days when I was in a committee. They are much in the airport. You see them in the seaport and all the rest. These cargo consolidators issue different kinds of charges, and a committee needs to be set up, especially for all ports.
“The whole ports must be reviewed. The Nigerian ports face a lot of excessive charges. Every charge in the port is excessive, and nobody controls them. The Shippers’ Council is not controlling anybody. They have not reduced any charge. The terminal operators are operating those charges,” he added.
He said now that there is no law at the moment to regulate most of these things, the government has the power to do it because what consolidators are doing is exploitation.
“What they do is duplicate charges. Why are they charging? It is duplication of charges. You charge when you are offloading and uploading. It is duplication. This country is just being run by people who do what they like. You collect money as consolidators to put things into the container, and at the export end, you collect money again,” he added.
He pointed out that a consolidator doesn’t have the link to do what they are doing because what they are doing is illegal.
He said a lot of things are illegal in the ports and that everything in the port must be reviewed, saying that Nigerians are operating the most expensive ports in the world, and nobody cares.
He added that people are suffering in the ports, and changes must be made to put things in the right perspective.