Some agencies at the ports have rolled out some palliatives for port users, Oluwakemi Dauda looks at how the palliatives are being administered.
TOUCHED by the problems caused the economy by the ravaging coronavirus pandemic, the Federal Government gave some reliefs to some sectors of the economy, including maritime.
These include suspension of payment of demurage and storage charges.
Storage and demurrage
When a container is discharged from a ship, it is moved to the Container Yard (CY) area of the port. This is where containers are stored before they are loaded on the ship in the case of exports or offloaded from the ship in the case of imports.
When the customer has cleared with Customs and is ready to take the container, he/she will move the container from the CY.
No port can store many containers at the CY area. It is essential that the importers clear the cargo within the “free period” offered by the port. However, there are cases where the consignee may be unable to take delivery due to documentary, financial or the Coronavirus pandemic.
In such cases, the containers will be stuck in the yard space, causing berth and port congestion. To discourage this, the port authorities will surcharge a container that has not been moved out within the specified free time.This is called port storage.
Also, when there is delayed clearance, the shipping line charges demurrage, a levy on the consignee if the container is not cleared and returned to the empty depot within the specified free days offered by the line.
It is possible that a container can incur both demurrage and storage on the same shipment, if the agencies of government fail to take the steps.
Ports suffering from poor and inefficient service
A maritime lawyer Mr Sunday Adebayo said despite being the leaders in the region through sheer market size and the options they bring, the seaports continue to suffer from poor and inefficient service delivery to its customers.
He said: “Many importers and clearing agents are paying through their nose to clear their goods from the Lagos ports despite that the world economy is going through a very sorry period because of the pandemic
“Based on the outbreak of pandemic and the decision of the Federal Government to keep the Lagos Port Complex (LPC), Apapa and the Tin-Can Island port open, the terminal operators and the shipping companies are using the opportunity to impose storage and demurrage charges on cargoes coming to the sea ports and smilling to the bank at the detriment of the people, the nation and its economy.’’
NPA and NSC to the rescue
To reverse the situation, the Nigerian Ports Authority (NPA) and the Nigerian Shippers Council (NSC) last week, brought succour to importers, clearing agents and other port users.
This came following the outcry by clearing agents that terminal operators and shipping firms have refused to comply with demurrage and storage waivers imposed by the NPA and the NSC.
NPA, in a second letter to the terminal operators last week, defined the terms of reference on port charges that need to be waived and given as palliatives for importers and clearing agents.
It directed terminal operators in Lagos to extend the suspension of terminal storage fees otherwise known as demurrage on consignments for another 14 days from April 13.
Its General Manager, Corporate and Strategic Communications Mr Jatto Adams, who made known this at the weekend said this follows the extension of the lockdown in response to the COVID-19 outbreak by President Muham-madu Buhari on April 12.
Jatto said the gesture was in recognition of the pressure of the pandemic on businesses as well as attaining the objectives of the Federal Government’s Ease of Doing Business policy during this period.
He said: “The authority states that compensation to terminal operators will be as spelt out in its April 8, letter to the terminal operators.”
The memo was signed by the NPA’s General Manager, Ugo Madubuike for the NPA Managing Director.
The NPA stated that it would grant terminal operators Credit Notes, commensurate with the reliefs the operators give to consignees.
“Further to our letter dated 2nd of April, 2020, directing the suspension of rent charges on consignments for an initial period of 21 days and effective from 23rd March, 2020, kindly be informed that to relieve you of the effects of the loss of rental charges due to Covid-19 pandemic, the Authority will grant Credit Notes commensurate to the rental reliefs granted by you to consignees within the period in reference.
“Kindly note that the compensation will be guided by the following terms: the compensation will only cover cargoes situated in your terminal within the period under reference; the terminal must produce evidence of delivery records indicating waiver of rent for the period in reference; the compensation shall only cover storable cargo within respective terminals; and the compensation shall only cover charges approved by the Authority and published by the terminal. Any charge outside these will not be accommodated,” Madubuike said.
Jatto, however, told The Nation that the NPA would not tolerate any non-compliance with directive and not hesitate to apply the appropriate sanctions.
NPA had, on March 27, directed terminal operators to suspend the collection of terminal storage fees for an initial 14 days from March 23 to cushion the effect of the Covid-19 lockdown on its customers.
The Executive Secretary of Nigerian Shippers Council (NSC), Mr Hassan Bello, has also directed shipping lines to suspend demurrage till the end of the lockdown.
Bello, who spoke in Lagos, reminded the firms that this was part of the incentives given to importers and exporters during the lockdown by the Federal Government and warned that any firm that flaunts the directive by imposing demurrage charges on shippers risk severe sanctions.
According to him, in line with the presidential directive that port operations are essential services, the council has been monitoring activities to ensure that seaports run efficiently and smoothly within this period, and in compliance with the existing health and safety guidelines for the prevention and containment of the spread of COVID-19.
Leave a Reply