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Legal issues dominate ports regulation agenda

By BusinessNews Staff on April 28, 2014

Experts drawn from the legal profession and industry chieftains gathered at a stakeholders’ forum recently, where they identified the urgent need for legislative empowerment and other issues to be addressed to aid the success of the Nigerian Shippers Council (NSC) as ports economic regulator, reports Francis Ugwoke

It was a gathering of legal experts and shipping industry chieftains, among others. And the issue at stake was how to achieve an efficient port system through regulation. The port reform programme of the federal government which led to the concessioning of the seaports eight years ago left a vacuum as it was done without a regulator in the system. Since then, stakeholders have been lamenting this gap. While many thought that it was only the shippers that were being oppressed by the terminal operators and multinational shipping agencies, it was revealed that the concessionaires were also suffering under the Nigerian Ports Authority (NPA) as a landlord.

Although, they have been silent on this, they however opened up during the recent breakfast meeting organised by the Nigerian Shippers Council (NSC) for stakeholders. The terminal operators claimed that while they have tried to fulfill the provisions of the concession agreement by providing relevant infrastructure that have led to increase in cargo and ship traffic, the NPA has failed to fulfill its own side of the bargain, yet has been antagonistic to them. The Chairman of the Association of Terminal Operators of Nigeria, Princess Nikky Haastrup, said it was a welcome development therefore that the NSC had now been appointed as a regulator to oversee every operation in the ports industry. Haastrup said that with this, the terminal operators now have who to report grievances to at any point in time.
But one major issue that dominated discussion by participants was the need to be fully armed in terms of legal instrument by the ports regulator. The participants called on the government to quickly push for the passage of the ports and Harbour and Nigerian Transport Commission (NTC) bills into law to give strong backing to the NSC as a regulator.

Expert Views on Regulatory Powers
Former Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA) , Mrs Mfon Usoro, a lawyer, was of the view that government must not stop at just appointing the NSC as economic regulator, but must be seen as providing enough legal backing that can give the regulator teeth to bite when necessary. Usoro who also identified funding as a critical factor for the agency to succeed added that the regulator needs to be fully armed with powers of the law to execute its statutory functions. She called on President Goodluck Jonathan and the Transport Minister, Senator Idris Umar, including the Chairman of the Board of the Council, Gen. Halilu Ibrahim (rtd), to pursue the passage of the bills as soon as possible so that the council can succeed.
Similarly, a maritime lawyer, Mr Louis Mbanefo (SAN), also identified the need for legal backing for the council as a regulator, adding that it ought to have been the first thing. But he said government should now speed up the process to give more powers to the regulator.
Another maritime lawyer, Mr Chidi Ilogu (SAN), who pointed out that the council can operate as a regulator with its current law, however, added that the need for urgent passage of the necessary bills for the regulator to operate cannot be over-emphasised.

Noting that eight years of the ports concession were long enough for a law guiding operators in the industry to be in place, Ilogu said that the sector had witnessed arbitrary charges as a result of the absence of strong regulation. He argued that now that government has appointed NSC as a regulator, every effort should be made for the passage of the necessary bills by the National Assembly to enable the council perform as regulator. Ilogu called on the President to intervene on the issue to ensure that effective regulation was made possible by the ports regulator. He also urged the transport minister not to rest until the Ports Bills were passed, adding that the outcome will lead to increased efficiency in the ports.
Noting that the NSC has no conflict of interest in the ports, Ilogu opined that the Council should be given a progressive support in all areas to succeed and transform into the Nigerian Transport Commission (NTC), adding that this will move the industry forward.
Former Executive Vice Chairman, Nigerian Communications Commission (NCC), Dr. Ernest Ndukwe, who was specifically selected to advise the NSC on regulation based on his experience in the communications sector also stressed the need for strong legal framework that will empower the Council.

Describing the ports as critical infrastructure, he said there was the need for a regulator to protect both the providers and consumers of shipping services. According to him, deregulation in any sector of the economy requires an independent regulator since, according to him, the ministry cannot do this because of the bureaucracy and conflict of interests. Ndukwe noted that many people see regulator as a policeman but added that in doing this, the regulator must have a role to ensure that the enterprises in the system work well. He said the regulator must check sharp practices, adding that the major role of a regulator is to protect consumer interest.

“The regulator must also promote efficiency. The regulator must have rules guiding the activities of the operators and those enjoying the services. It is important to have rules and regulations. The regulator must have powers to approve tariff, ensure fair competition. It must be involved in adjudicating on matters in the industry. Making profit is not a sin, but arbitrary charges must be checked by the regulator. The regulator must have documents that will authorise these operators to work well.
“The regulator must have room for introducing new services and doing away with old services. Interaction should be regular with industry stakeholders. Before a rule is introduced, it is good to present such rule to the industry stakeholders. Once consultation is done, then the rule becomes binding. The regulator must have power to summon anybody to appear before it. The regulator must also have power to demand the reasonableness of a tariff, and that it is justifiable. The regulator must have enough funding, and must not depend on operators”, he said.
Former Managing Director of the NPA, who was also former Executive Secretary, NSC, Chief Adebayo Sarumi, also spoke strongly on the need to equip the regulator in terms of necessary laws. Sarumi recalled his days in the council and the difficulty he had dealing with shipping companies who introduced unapplicable charges in the Nigerian ports. He said while the council insisted that the charges be dropped, the shipping companies went to court to question the powers of the council to do so. The shipping companies, he said, also got an injunction against the council that lasted for two years. Sarumi said such scenario would repeat itself if the necessary regulations were not passed to back the council’s port regulatory functions in the ports.
“There would be chaos without regulation. The NSC cannot succeed without regulation. We need the laws to give NSC the necessary powers”, he said. Salihu Ibrahim, Bello Assure of Fairness to Terminal Operators, Others
Chairman of the Board of the NSC, Lt Gen. Salihu Ibrahim (GCON), and the Executive Secretary, Mr Hassan Bello, had during the meeting with stakeholders assured that the ports regulator would not disappoint the stakeholders. Ibrahim who described the appointment of the NSC as economic regulator as a welcome development added that the best way to make the assignment a huge success for all was to listen to expert advice and contributions as a guide to the Council in the preparation of its working document for effective implementation.
Bello in his speech assured stakeholders, including the terminal operators, shipping companies and consumers of services of fairness in its new assignment. He maintained that the council would not be biased, adding that all the Council wants to achieve is efficiency in the conduct of businesses in the nation’s ports. According to him, the council will consult widely in every policy measure to be introduced at the ports, and urged the providers and consumers of shipping services for cooperation. “No matter how daunting the challenges are, the NSC has the capacity to carry out regulation at the port. When the appointment was made, I called them and looked into their eyes and asked them, can we do this national assignment… and we all agreed that we can do it. And based on this, I am sure the staff of the NSCV are capable of discharging this responsibility.”
Bello added: “Regulation is something that has to be scientific, it has to be open, and we shall be consulting with stakeholders on the best way forward, and this we have already started. Regulation of the ports is for the benefit of the economy. There will be balance to achieve the best. The investors have invested so much and their interest will be protected. But you also have to ensure that they provide quality service.”

[This Day]

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