VIN Valuation: Congestion Likely At Nation’s Ports As Importers Abandon Vehicles 

In spite of the review of the VIN Valuation policy, importers and freight agents are having tough times as they have resorted to abandoning their vehicles at the port terminals with an attendant accumulation of demurrage and other sundry charges, a situation stakeholders fear might lead to congestion.
Speaking at a roundtable organised by the Maritime Journalists Association of Nigeria (MAJAN) in Lagos, a member of the Association of Professional Freight Forwarders and Logistics in Nigeria (APFFLON), Clinton Okoro, said the Nigeria Customs Service (NCS), should exercise patience in test-running the VIN Valuation policy and expressed concern that Customs officials seem to be implementing the policy in a hurry.

“Although the NCS gave a three-month window after the protests that greeted its introduction, the way they made us believe it will work is not the way it is working. So, the policy is not okay with us, because it is causing a lot of delays, which come with congestion and accumulation of demurrage. Worse still, the officials don’t explain the challenges to the terminal managers,” Okoro lamented.
However, on what he thinks should be done, Okoro said two widows should be created in the VIN Valuation System to incorporate the manual and standard systems before gradual harmonisation of the entire system.
Also responding to the effects and workability of the VIN Valuation policy, another member of APFFLON, Iyke Umelo, said: “It is true that the Federal Ministry of Finance introduced the new system through the NCS to facilitate trade, but it is also true that we applauded the Customs when they introduced the policy because we were seeking a way of harmonising clearance procedures to save time and eliminate bottlenecks.

“But we have found out that there are several contradictions in the new valuation system to the extent that some vehicles like Toyota Corolla and Mercedes Benz have not been imputed into the system.”
He pointed out that the major problem was non-standard value, because of the delay and high duty on non-standard rated vehicles, which he said, was causing a lot of stress for car dealers, freight forwarders and importers.
“Furthermore, everyone is complaining about the high valuation, which is forcing people to abandon their vehicles at the ports. Terminal operators are not also having it easy with congestion in their terminals. Even the Customs officers are not left out of the lamentation, because there is a drop in revenue generation and meeting their target is becoming a Herculean task.

“People are also suspicious that the Customs is systematically phasing out the importation of over-aged vehicles, which is why the difference between the 2016 model of Toyota Corolla and that of 2013 is so wide,” he said.
On his part, George Okafor of the National Association of Government Approved Freight Forwarders (NAGAFF), lamented that the high valuation of vehicles was due to the fact that the NCS was trying hard to meet the target given to it by the Federal Government, while also trying to plug the gap left by the 20 per cent drop in duty collection.
“The value of Mercedes and Toyota Corolla are so outrageous, if you are on 846, they use the new template of 2003 to 2013, which cost is about N2.8 million, as against between N390,000 and N400,000. This has made most owners abandon their vehicles, although consultations and meetings are going on to find a solution to the anomaly,” he said.
Another stakeholder, Mrs Jewel Igwe of NCMDLCA, said: “Non-standard value is the cause of the outrage, as there was no circular to that effect. What we had was 15 years, before they said they were going to work with 12 years, but they imputed nine years into the system.”
She urged the authorities to adjust the duty and review the age limit of vehicles adding:

The letter of error in valuation is causing serious congestion in most terminals, but at Tin Can, the CAC Code will rescue the situation, because it has been routed to the Controller instead of the registry.

“The Customs has said there is no going back on the VIN Valuation policy and we agree with them, because of our experiences with the Ad-hoc Task Force, which usually extort us on the roads.”