Communique Of The 2022 Compliance Roundtable
The Maritime Anti-Corruption Network (MACN) and the Convention on Business Integrity (CBI) in collaboration with the Independent Corrupt Practices and Other Related Offences Commission (ICPC), the Technical Unit on Anti- Corruption Reforms (TUGAR), the Nigerian Shippers Council (NSC) held a roundtable Discussion on Compliance Function in the Nigerian Maritime sector on the 31st March 2022 at the Transcorp Hilton Hotel, Abuja, FCT.
The Roundtable Introduction
The roundtable with the theme ‘A Maritime Sector Fit For Purpose’, brought together Heads/Representatives of Port Agencies including the Federal Ministry of Transportation (FMoT). Nigeria Immigration Service (NIS), Nigeria Quarantine Service (NQS), Port Health, the Nigeria Shippers Council (NSC), Nigerian Maritime Administration and Safety Agency (NIMASA), National Drug Law Enforcement Agency (NDLEA), Nigeria Customs Service, Nigerian Police Force (Marine Police). Other agencies and organisations present included the Independent Corrupt and Other Related Practices Commission (ICPC), the Technical Unit on Governance and Anti-Corruption Reforms (TUGAR), National Association of Government Approved Freight Forwarders (NAGAFF), Council for the Regulation of Freight Forwarding in Nigeria (CRFFN), Lagos Chamber of Commerce and Industry (LCCI), Calabar Chamber of Commerce and the MACN Integrity Alliance (IA) leaders from Lagos, Port Harcourt and Calabar.
Discussion Overview
The conference was convoked to discuss the compliance functions of port agencies, the importance of compliance functions as relates to the standards and procedures individual organizations have set and an exploration of how sanctions-based compliance (negative incentives) and rewards-based compliance (positive incentives) can help achieve the operational outcomes ports agencies desire.
Welcome Address
The event began with a Welcome Address by Ms. Jane Adidu-Onwumere, Head TUGAR. In her welcome address, Ms. Adidu Onwumere thanked the organizers for the opportunity given to TUGAR to welcome participants and expressed her appreciation to the Convention on Business Integrity (CBi) and the Maritime Anti-Corruption Network (MACN) for organizing the roundtable which seeks to develop strategies to sustain the successes achieved in the ease of doing business and ensure that Nigeria reclaims its place not just amongst West Africa’s Maritime States but globally.
Going further, she gave a brief history of the present reform efforts in the maritime sector, beginning with the concerted efforts of TUGAR, ICPC, and the Bureau of Public Procurement (BPP) in 2011 to develop a country-specific methodology for conducting Corruption Risk Assessments, train and certify a pool of Corruption Risk Assessors drawn from the anti-corruption agencies, select states and the civil society and the subsequent conduct of Corruption Risk Assessment in 6 Nigerian Seaports. This culminated in the creation of the Port Steering Committee (PSC) to drive and implement the recommendations from the assessment. Ms. Adidu- Onwumere then spoke of the development of Standard Operating Procedures (SOPs), the Port Service Support Portal (PSSP), and the Nigerian Port Process Manual (NPPM) launched by the Office of the Vice President in 2019. While acknowledging the partnership of MACN and CBI, she pledged to continue to partner with and support the work of the MACN and CBI in the sector and enjoined all the stakeholders in the sector to collectively do same in order to ensure transparency and accountability and facilitate effectiveness and efficiency of Nigeria’s ports.
Goodwill Messages
Following the welcome address, Mr. Edward Kabir, representing Mr. Mohammed Bello-Koko, Managing Director of Nigerian Ports Authority (NPA), gave a goodwill message. ln his remarks, the MD while thanking the Maritime Anti-Corruption Network for sustaining the discourse around ridding Nigerian Ports of corruption and allied perversion of processes and procedures that impedes the attainment of service excellence noted that theme of the roundtable “A Maritime Fit for purpose” aptly captures what should constitute the overriding objective of stakeholders in the global maritime value chain. While noting that the vision of NPA is to be the preferred Port in Africa is tied to the imperative of elimination of corruption, he also observed that the Federal Government’s goal of diversifying the economy from sole dependence on oil to non-oil export can only be successful if corruption is curbed and the ease of doing business is ensured.
He went on to pledge that the NPA will continue to improve on its services as well as continue to sensitize port users on the Nigerian Port Process Manual (NPPM) through its media points. He also pledged to continue to support the work of the Port Steering Committee (PSC) and the Port Standing Task Team (PSTT) to enhance efficiency, and improve competitiveness and productivity that will boost the Nigerian economy. In concluding, he called on all agencies in the ports to embrace the determination to bring corruption to the barest minimum so that Nigerian Ports can be aligned with international best practices.
Hon. Emmanuel Jime, Executive Secretary of NSC, who also gave a goodwill message spoke on role of NSC and the state of the maritime sector. He highlighted the uncertainties in global oil market, the ripple effects of COVID 19 still in effect today and thus emphasized that it has become pertinent that government institute reforms that will diversify the economy. The maritime sector, he observed, is a low hanging fruit for diversification if properly harnessed. He noted that the potential of the sector is enormous and estimated to bring in 7 trillion naira annually as well as create 4 million jobs in the next 5 years if Nigeria properly taps into the blue economy. He mentioned the need to address infrastructure decay, maritime security, port inefficiencies, and other infrastructural challenges. NSC, Nigeria Customs Service, and the NPA, he noted, all have vital roles to play for the sector to realize its full potentials. He concluded by committing the NSC to remaining open, independent, neutral, and to make all decisions based on buy in of stakeholders.
Keynote Addresses
In his Keynote Address the ICPC Chairman Professor Bolaji Owasanoye (SAN) represented by Mr. Sulahiman Jimoh stated that the ICPC appreciates collaboration to make ports competitive and efficient and that the maritime industry represents a gold mine for Nigeria. The intervention of the ICPC in the Maritime sector, he said, is premised on its mandate to examine practices, systems and procedures of public bodies, and where such practices, systems, and procedures facilitate fraud or corruption to direct and supervise a review of such. He mentioned ICPC’s intervention in the maritime sector beginning from 2011 includes the conduct of the Corruption Risk Assessment, membership of the Project Steering Committee (PSC) of the Port Service Support Portal (PSSP), drafting of Standard Operating Procedures (SOPs) for port agencies and the Nigeria Port Process Manual (NPPM), and the establishment of the Port Standing Task Team (PSTT) in conjunction with the NPA and NSC. While noting that it is disturbing that only the NSC is currently funding the PSTT, he concluded by declaring that impunity is over in the maritime sector and the unrelenting commitment of ICPC in facilitating the promotion and strict enforcement of the SOPs, PSSP and NPPM.
The Hon. Minister of Transportation, Hon Rotimi Amaechi represented by the Permanent Secretary Dr. Magdalene Ajani, in his Keynote address expressed his best wishes and that of the Hon Minister of State for Transportation. The Minister going further mentioned the several successes the Ministry of Transportation has achieved, including government led reforms in infrastructure, policy, and operations. While noting that the Federal Ministry of Transportation through NSC, TUGAR, and ICPC, in collaboration with MACN and CBi have built reform momentum from successes, creating a prime opportunity for growth. He observed that the challenges are still enormous. He noted delays, red tape, rent seeking, corrupt demands, human and vehicular traffic congestion still exist. Future progress he observed depends on institutionalizing a system where port operations are protected. The Hon. Minister in his address underlined the need to strengthen compliance within port agencies saying that “we cannot afford to lose gains and momentum that we have built”.
Addressing Challenges
Going further, the Hon Minister underlined the need for an assertive system of sanctions and rewards-based compliance, and called for the support and political will of those who play key roles in the maritime sector including supporting, energizing, and synergizing on how best to enforce compliance, especially for those outside oversight of the highest level of port agencies. Speaking further on the role of compliance officers and the need to share best practices for mainstreaming compliance function into agencies even amid constraints, the Minister emphasized the need for an appropriate, relevant, realistic framework for compliance function within port agencies.
Mr. Soji Apampa, CEO, CBI, while giving the background to the roundtable thanked participants for their attendance. While highlighting the reason convening the roundtable, he said the Nigerian maritime sector is at the cusp of either great progress, stagnation, or regression. Based on data from the CBi help desk, MACN’s Anonymous Reporting Platform, and NSC’s managed PSSP data tracking, a drastic drop in demand for unreceipted large cash payments on the vessel clearing side of port operations has been observed. Noting that “Something has shifted; something has changed”, he said that it is either this momentum continues into cargo clearance and port corridors, or else nothing is done and the sector slips back on the successes recorded. While observing that the sheer size and spread of what needs to be done is great (including in the sea ports, terminals, and offshore facilities like floating production platforms), he stated that simply policing these different facilities (via the PSTT alone) is not feasible. He underlined the need for a compliance function at a high enough level in operations internally in each of the port agencies and in each location so as to ensure compliance with SOPs, which will also maintain the dignity and harmony within each agency while PSTT deals with outliers. The tone-at-the-top through the buy-in of Heads of Agencies, he emphasized, has been demonstrated so far with vessel clearance but reiterated that the concern now is how to get same level of compliance with the rank-and-file on a daily basis with the different port agencies. In conclusion, he mentioned the need to find a balance between trade facilitation and revenue generation by the Nigerian Government and port agencies.
In the follow up discussion session, Mr. Moses Fadipe, the National Coordinator of the Port Standing Task Team (PSTT) in his progress report on the “Rationale, Progress, and Challenges” of the PSTT observed that the PSTT has become arguably the single most impactful initiative of the administration’s drive in the Ease of Doing Business, especially in the ports sector. While describing the systemic intervention and successes achieved so far, he referred to the drastic reduction from an average of 5 hours to an average of 90 minutes for ships from anchorage to berth, ensuring that only manning agencies permitted by the port process manual board vessels and reduction in corruption in terms of cash and other gift items received on boarded vessels by government officials among many other successes. He concluded by highlighting the challenges of the PSTT including financial, human, logistics and equipment challenges and the need for the relevant port agencies to support the work of the PSTT.
In the ensuing plenary discussions, which examined the Role of Compliance in the Nigerian Maritime Sector, Existing Compliance Arrangements Within Port Agencies, and What is Possible Within the Current Operational Framework, participants observed as follows -
That in the spirit of the Federal Government’s goal of diversifying the economy from sole dependence on oil to non-oil sources of revenue, Nigerian ports and indeed the Nigerian maritime sector remains a major means of achieving this goal.
To achieve this aim, corruption must be curbed and the ease of doing business has to be ensured.
The need to break down and dismantle territorial boundaries/turf by port agencies and focus on Nigeria as an entity.
That despite the development of the Standard Operating Procedures by port agencies towards curbing corruption and unethical practices, adherence to the SOPs remains low across port agencies.
The need to support the work of the PSTT with the requisite resources in terms of finance, equipment and manpower.
The need for the compliance function to be mainstreamed into the activities of port agencies and selection of officers with the requisite seniority level (not below a Deputy Director or its equivalent) and field operation experience to perform such a function.
That while there exists traders and importers/exporters who are keen to short circuit the system for personal gain, there must be in place a system to reward compliant traders/importers/exporters.
That despite the incremental changes recorded in the vessel clearance of the Nigerian maritime sector, a lot needs to be done in the clearance and post- clearance of cargoes in the sector.
The existing menace of multiple checkpoints in the ports corridors and beyond (over 300 between Lagos and Kaduna) and the cost of such checkpoints to the cost of goods clearance and cost of doing business.
The economic impact and implications of multiple checkpoints shows up in terms of lost businesses to neighboring countries by Nigerian businessmen and landlocked countries bordering Nigeria choosing to avoid Nigerian ports.
The need for a national maritime policy and development of deep seaports.
The need to periodically move officers of port agencies so as to avoid the entrenchment of criminal cabals within the ports and its corridors. Ports Police/Maritime/Marine Police promised to do this immediately. The meeting called on customs and other to follow suit.
The existence of area boys and criminal elements representing government agencies and the extortion of port users by such elements under the cover and protection of government agencies.
Conclusion and Proposals
At the end of the plenary discussion sessions, participants proposed as follows:
The need to focus on the collective interest of Nigeria and breakdown/dismantle territorial boundaries and turfs between port agencies.
Operationalization and mainstreaming of compliance function in all port agencies and locations in Nigeria.
Gazetting of the existence and functioning of the activities of the PSTT.
Provision of requisite resources for the PSTT in terms of funding and human resources.
The Hon. Minister represented by the Permanent Secretary in his concluding remarks after the plenary conversations instructed port agencies to ensure the consistent application of the SOPs to at least 80% compliance level by the end of year 2022.
He promised to support the planned initiative to clear checkpoints from the port corridors on April 11. The Hon Minister also proposed for a meeting of all port Agencies in December 2022 to review and measure implementation as well as adherence to the SOPs. The Hon Minister as represented concluded by saying that ‘the world is waiting for Nigeria, and we should not disappoint our future generations.
MACN's Commitment
At the conclusion of the discussion sessions, Mr. Vivek Menon, Associate Director of MACN, spoke of MACN’s experience in Nigeria for the last ten years. He expressed his admiration for the successes the various Agencies have achieved, and reiterated the need for a robust, reliable Compliance Function in each Agency to sustain the progress made. He expressed MACN’s commitment to continue to support Agencies with specific training and capacity building as they institute the compliance function. He also requested the ongoing goodwill and collaboration of the various Agencies and stakeholders to continue, so as to build a Maritime Sector on transparency and accountability.
