SENATE yesterday began a comprehensive probe of the activities of the Nigerian Customs Service, NCS, with a view to blocking all sources of revenue leakages. The probe launched by the Senate Committee on Customs and Excise which began in Abuja on Wednesday, is to look at ways to increase revenue generation capacity of the service. Chairman of the committee, Sen. Hope Uzodimma, during an oversight visit to the headquarters of the NCS in Abuja, said that service should be generating enough revenue to fund the nation’s budget. He expressed grave displeasure at a report by the Ministry of Finance which showed that the Customs Service had generated less than N400 billion in 2016. While speaking at the end of the oversight visit, Uzodinma said that the committee might resort to re-enacting the Act establishing the NCS for optimal performance. “We are looking into the operations of Customs service, looking at the areas of revenue generation and possible leakages with a view to finding solution. “We have done a very detailed work here we have established contacts with the commands. All we are interested in doing is to bring up a robust position that will help the NCS earn more revenue. “In order to do that effectively, we are looking at their current modus operandi with a view to refining how things are done so that more revenue can accrue to the service. “By the time we look at the operations of some of these ports, we will come back and look at how best to amend and alter the existing Act. “We want to create a document that will be bold enough to earn the country the kind of revenue we are looking for from non-oil sector,” he said. Speaking on the revelation that oil majors were not accessible to the service for payment of levies, the senator said that those were some of the areas that required enabling laws. “There are some limitations that has not made it possible for Customs to perform the way they should according to their mandate. “Those are things that we will also look at and remove all obstacles to enable them function effectively,” he said. Earlier while interacting with the Comptroller-General of the service, Col. Hameed Ali (rtd), the committee requested the submission of certain relevant documents to enhance the probe. It gave the commission until Friday, October 28, to submit the requested documents and answer all the queries posed. The committee sought to know how the seven percent Negotiable Duty Credit was managed as well as how it handled seized cargoes and overtime cargoes. The service is expected to bring details of how it handles seized cigarette and alcohol, record of auctioned overtime cargoes as well as auctioned seized cargoes. The committee also sought the record of all waivers granted in the last three years and the value of the waivers. The detailed record of sugar levy is also to be submitted to the committee as well as other details of accruable revenue. The committee frowned at the service for always seeking for funds instead of working to generate more funds. Uzodinma frowned at the situation where the service was not collecting duty from oil companies and promised a legislation to review the law. In his remark, Col. Ali assured the committee of the full cooperation of the service, as he directed his officials to provide the committee with all the information and documents it required. Meanwhile, the committee has proceeded to Lagos for the second phase of the oversight and plans to visit all the ports and customs offices in the state. Proposes 10% revenue for HYPPADEC host communities Senate yesterday proposed a 10 percent total revenue for Hydroelectric Power Producing Areas Development Commission, HYPPADEC, host communities. In his lead debate titled ‘A Bill for an Act to amend the Hydroelectric Power Producing Areas Development Commission (Establishment Act), 2010, Senator David Umaru (APC, Niger East) said the proposed amendments would validate and give legal backing to the 10 percent HYPPADEC charge being deducted from the invoices of companies ( i.e GENCOs, DISCOs, etc) and retained by various government agencies, including the Market Operator, MO, the Nigerian Bulk Electricity Trading, NBET, between 2013 and 2015. Umaru said the proposed amendments would be reduced from 30 percent to 10 percent, the charge imposed on the total revenue generated from the operations of any company or authority operating hydroelectric dams in any member state of the commission. He noted that host communities had been ravaged by flood and others afflicted by water- borne diseases, environmental pollution and loss of lives and properties, stressing that the plight of communities in the HYPPADEC member-states remained an issue of great concern to many. He stressed that “section 14 (2) (a) of the Principal Act which this Bill proposes to amend provides that “ 30 per cent of the total revenue generated by any company or authority from the operation of any hydroelectric dams in any member State of the Commission shall be remitted to HYPPADEC as one of the main sources of funds to execute its mandate under the Principal Act.” According to him, the 30 percent charge imposed on the total revenue of GENCOs, DISCOs, etc. from the operation of hydroelectric dams under section 14 (2)(a) became the bone of contention between investors, market participants and the regulator of the electricity industry and NERC, leading to a demand for a downward review of the charge imposed by the Principal Act. He said: “The demand for the review of the surcharge imposed on the annual revenue of the above mentioned entities from 30 percent as contained in the Principal Act to 10 percent, was based on the fact that it became impracticable for such a large percentage of the total revenue of hydro-based electricity generating companies to be remitted to HYPPADEC without having
adverse effect on the performance of these entities considering the capital intensive nature of the industry and the myriad of problems inherited by these investors following the unbundling of NEPA. “The plight of communities in the HYPPADEC member states remains an issue of great concern to many. Host communities have been ravaged by flood, and others afflicted by water borne diseases, environmental pollution, loss of lives and properties.” He, however, called on government to as a matter of urgency inaugurate the commission which is long overdue, noting that if it became operational it would take custody of accumulated HYPPADEC charge now presumably in the custody of different government agencies. In his remarks, Deputy Senate President Ike Ekweremadu who presided during plenary referred it to the Committee on Finance and to report back within four weeks. Senate passes Bill to boost business competition, seeks scrapping of CPC Senate yesterday approved a bill seeking to promote business competition among the 36 states and destroy all forms of business monopolies in the country. Accordingly, the upper legislative chamber approved that the Consumer Protection Council, CPC, be scrapped and replaced with Federal Competition and Consumer Protection Commission. The bill, which was sponsored by Senator Andy Uba (PDP Anambra South), passed second reading with the Senate directing its Committee on Trade and Investment to conclude all legislative works on the bill and report back within four weeks. The Senate believed that promotion of business competition would be achieved by the provisions of this bill, in which it seeks “to control existing monopolies, discourage the abuse of dominant market position and other restrictive trade and business practices.” The bill is part of the Reform Bills highlighted by the eighth Senate (at the inaugural National Assembly Business Environment Roundtable held in March 2016). The upper chamber as disclosed that the bill was capable of improving the ease of doing business in Nigeria and producing a direct impact on the prospects of the Nigerian economy. Leading the debate on the general principles of the bill, Uba stated that, “The essence of this important bill, which extends
the present reform culture of government into the areas of business and commercial practice, is to promote a balanced development of the Nigerian economy; the welfare and interests of consumers, and provide them with competitive price and product choices; and competition and enhance economic efficiency in production , trade and commerce. “The rest are expansion of opportunities for domestic enterprises to participate in world markets; the ability of small and medium enterprises to compete effectively; and the restriction of business practices which prevents, or distorts competition or constitute the abuse of a dominant position of market power in Nigeria.” Senator Uba further explained that the bill was initiated because “it is necessary to ensure through legislation that monopolistic enterprises in our country do not take undue advantage and hurt consumers at will. “The issue of resale price maintenance is critical in every market, and because it is well known that Nigeria is the largest market in Africa, it is crucial to ensure that we do not allow our country to be a dumping ground for inferior quality products or to be seen as promoting unfair trade practices,” the lawmaker added. The bill provides that it is unlawful for any two or more enterprises that are suppliers of products to enter into or carry out any agreement where they undertake to “withhold supplies of products from dealers (whether parties to the agreement or not) who resell or have resold products in breach of any condition as to the price at which those goods may be resold; refuse to supply products to such dealers except on terms and conditions, which are less favourable than those applicable to other dealers carrying on business in similar circumstances. “Just as collective agreements by suppliers is unlawful, so too is collective agreement by dealers illegal under this proposed bill. “Dealers who withhold orders for supplies (whether parties to the agreement or not) discriminate in their handling of products supplied and so commit an offence punishable under this bill, if passed into law.” According to the bill, the Federal Competition Commission shall have powers to give clearances for mergers, takeovers and acquisitions and give authorization for them. Section 77 deals with monopolies. “For instance, any person or body corporate who monopolises or attempts to monopolise or combine or conspire with any other person or persons to monopolise any part of trade or commerce, commits an offence under this proposed act.”


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