Suspension of the 846 Vehicle Valuation System and Urgent Need for a 90-Day Transitional Waiver
By Sea Empowerment and Research Center
Background:
The Nigeria Customs Service (NCS), pursuant to its powers under the Nigeria Customs Service Act, 2023 and in alignment with government efforts to modernize customs administration, recently issued a circular directing the immediate suspension of the 846 Vehicle Valuation System. This directive further mandates that all vehicles presently on ground in terminals, on vessels approaching Nigerian ports, and all future imports be subjected to the Vehicle Identification Number (VIN) Valuation System, with additional demand notices issued where necessary.
Aniezechukwu Francis Uchechukwu, DG, Sea Empowerment Research Center
While modernization is welcome, the abrupt nature of this shift raises concerns regarding the statutory obligations of the NCS to engage stakeholders and provide a transition period, as provided under the Customs and Excise Management Act (CEMA) and the Nigeria Customs Service Act, 2023.
Statutory Grounds for a 90-Day Waiver
1. Stakeholder Sensitization Mandate
Sections 28, 29, and 30 of the Nigeria Customs Service Act, 2023 mandate consultations and sensitization of stakeholders—importers, freight forwarders, and logistics service providers—before implementing significant valuation or procedural changes.
2. Trade Facilitation Obligations
Nigeria, as a signatory to the WTO Trade Facilitation Agreement (TFA), must provide advance publication and reasonable adjustment periods for new trade regulations to enhance transparency and predictability.
3. Established Precedents
Implementation of the VIN Valuation System in 2022 included stakeholder adjustment periods.
Similar phased approaches were adopted during the rollout of the Pre-Arrival Assessment Report (PAAR) and the single-window trade platform.
4. Need for Transitional Relief
A 90-day waiver would allow importers and logistics providers to realign procurement, shipping, and pricing structures with new valuation requirements, avoiding port congestion and unanticipated costs.
Consequences of Sudden Policy Change:
1. Investor Confidence and National Image
Abrupt regulatory shifts erode Nigeria’s reputation as a stable and predictable trade hub, discouraging foreign investors and vehicle manufacturers.
2. Ease of Doing Business
The Tinubu administration prioritizes improving Nigeria’s Ease of Doing Business ranking. Sudden policy changes contradict this agenda.
3. Economic Risks
Revenue Decline: The 846 valuation system boosted NCS revenue, particularly at roll-on/roll-off ports like PTML. Sudden suspension risks reduced cargo throughput and potential diversion to neighboring ports.
Operational Losses: Importers face unbudgeted duty uplifts, demurrage, and storage charges, raising costs for consumers.
Logistics Disruption: Vehicles already en route cannot retroactively comply with VIN valuation, causing delays and congestion.
Recommendations
1. Grant a 90-day transitional waiver for all vehicles shipped, landed, or on order under the 846 valuation framework.
2. Conduct urgent stakeholder consultations with importers, freight forwarders, OEMs, and terminal operators to ensure smooth migration to the VIN valuation system.
3. Issue clear, consistent implementation guidelines to safeguard transparency and investor confidence.
4. Preserve the gains in revenue and operational efficiency achieved through the 846 valuation system.
Conclusion
A phased approach to suspending the 846 valuation system aligns with statutory obligations, protects importers from unforeseen losses, sustains customs revenue, and upholds President Bola Ahmed Tinubu’s commitment to trade facilitation and economic stability.
Signed:
Aniezechukwu Francis Uchechukwu Director General, Sea Empowerment and Research Center
