Oil and Gas Free Zone Authority stops container fees in free zones; exporters, investors hail decision

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Umana Okon Umana MD, Oil and Gas Free Zone Authority

The Oil and Gas Free Zones Authority (OGFZA) has stopped all charges on containers imported into the nation’s oil and gas free zones to cut the cost of doing business. In a letter of 23 May stopping the levy which was called “oil related cargo delivery charge,” OGFZA’s head of operations and technical services, Mr Adekunle Ajayi, who signed for the managing director, directed the West Africa Container Terminal (WACT), the company that was charging the fees, to suspend the imposition of the levy at once.

The letter to WACT explained that the levy was not authorized by OGFZA and was therefore in violation of section 11 of the Oil and Gas Free Trade Zone Regulations 2003 which states that “the Authority shall issue a schedule of tariffs which shall apply in the Free Zone and which shall be reviewed from time to time and copies made available to the licensees operators.”

The managing director of OGFZA, Mr Umana Okon Umana, described the cancellation of the unauthorized container levy as a significant expression of commitment by OGFZA to the federal government policy on the ease of doing business and a vote for due process.

Umana said there was need to do all that is proper to help free zones investors who have felt the pinch of the economic downturn on their bottom line.

The Exporters’ Association of Nigeria has hailed the policy decision as “a welcome development and good news” to hundreds of “exporters who were already complaining about the terminal charges.” Prince Joseph Idiong, director-general of the association, said his office received a written complaint from association members in July last year not just about the levy but even about an increase in the charge per container.

Idiong explained that following the complaint, the association wrote to the World Bank office on global competitiveness asking them to intervene and get the Nigerian government to do something about the tariff. “It is therefore gratifying that while we were still expecting to hear from the World Bank, OGFZA has delivered the good news,” Idiong said. “I want to commend the management of OGFZA on behalf of exporters for this good news.”

Indorama port terminal operator at Onne Oil and Gas Free Zone, Mr Manjunath Gowdara has endorsed the OGFZA ban on container charges, adding that the agency was right in stopping the unauthorized levy.

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