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Executive Report on Strategies in Nigeria
ICON Group International, June 2007, Pages: 386
How to Strategically Evaluate Nigeria
Perhaps the most efficient way of evaluating Nigeria is to consider key dimensions which themselves are composites of multiple factors. Composite portfolio approaches have long been used by strategic planners. The biggest challenge in this approach is to choose the appropriate factors that are the most relevant to international planning. The two measures of greatest relevance are “latent demand” and “market accessibility”. The figure below summarizes the key dimensions and recommendations of such an approach. Using these two composites, one can prioritize all countries of the world. Countries of high latent demand and high relative accessibility (e.g. easier entry for one firm compared to other firms) are given highest priority. The figure below shows two different scenarios. Accessibility is defined as a firm’s ease of entering or supplying from or to a market (the “supply side”), and latent demand is an indicator of the potential in serving from or to the market (the “demand side”).
Framework for Prioritizing Countries
Demand/Market Potential Driven Firm
Relative Accessibility
Accessibility/Supply Averse Firm
Relative Accessibility
In the top figure, the firm is driven by market potential, whereas the bottom figure represents a firm that is driven by costs or by an aversion to difficult markets. This report treats the reader as coming from a “generic firm” approaching the global market - neither a market-driven nor a cost-driven company. Planners must therefore augment this report with their own company-specific factors that might change the priorities (e.g. a Canadian firm may have higher accessibility in Canada than a German firm).
Latent Demand and Accessibility in Nigeria
This report provides an extremely detailed overview of factors driving latent demand and accessibility in Nigeria. Latent demand is largely driven by economic fundamentals. But, latent demand only represents half of the picture. A country may at first sight appear to be attractive due to a high latent demand, but it is often less attractive when one considers at the macro level how easy it might be to serve that entire potential and/or general business risks.
Chapter 2 deals with macro-accessibility. While accessibility will always vary from one company to another for a given country, the following domains are typically considered when evaluating macro-accessibility in Nigeria:
Openness to Trade in Nigeria
Openness to Direct Investment in Nigeria
Local Marketing and Entry Strategy Alternatives
Local Human Resources
Local Risks
Across these domains, a number of not-so-obvious factors can affect accessibility and risk. These are also covered in Chapter 2, which is presented from the perspective of an American firm, though it is equally applicable to most firms entering Nigeria. This chapter has been authored by local offices of the U.S. Government. I have included a number of edits to clarify the provided information as it relates to the general strategic framework.
In Chapter 3, I summarize the economic potential for Nigeria over the next five years for hundreds of industries, categories, and products. The goal of this chapter is to report my findings on the real economic potential, or latent demand, represented by Nigeria when defined as an area of dominant influence. The data presented are the result of various spatial econometric and time-series forecasting models which, for each category presented, are applied to forecast and allocate latent demand across all countries of the world and major distribution centers or centers of dominant influence within each country. This is accomplished knowing that economic fundamentals (e.g. income) generally vary from one country to another within a given country over time. In this chapter, I report the allocation for each category for Nigeria as an area of dominant influence in Africa and, potentially, the world.
As a whole, this report presents a strategic assessment of Nigeria by considering an extremely broad set of factors affecting both latent demand and accessibility, as outlined in the following chapters.
MACRO-ACCESSIBILITY IN NIGERIA
Economic Fundamentals and Dynamics
Prospects for sustainable economic growth are mixed. Nearly 70 percent of Nigerians are employed in agriculture, but the sector accounts for only about 35 percent of GDP. Minerals (including petroleum) and the services sectors account for about 30 percent and 24 percent of GDP respectively. Manufacturing sector contributes only about 5 percent, while government accounts for the balance, 6 percent.
Regional Integration
Nigeria is one of 16 members of the Economic Community of West African States (ECOWAS). The Treaty of Lagos established ECOWAS in May 1975. Members signed a revised ECOWAS treaty in 1993 that designates a common market and a single currency as economic objectives. Nigeria is a founding member of the New Partnership for Africa’s Development (NEPAD). NEPAD, established in 2001, has a stated goal of eradicating poverty in Africa. It is developing a peer review process on economic governance.
Petroleum
Nigeria’s economy is highly dependent on its oil sector. Oil revenues comprise about 80 percent of Federal Government revenues, 90-95 percent of export revenues, and more than 90 percent of foreign exchange earnings. Almost all the state-owned joint-venture contracts under which most oil is produced require the Government to invest large sums of money into the sector. The United States imports about 10 percent of its crude oil from Nigeria, making it the fifth largest supplier of crude to the United States. Nigeria has about 31 billion barrels in proven oil reserves.
Nigeria is the seventh-largest OPEC producer. Ethnic clashes, community strife, vandalism, seizure of hostages, and the rise of other criminal activity challenge oil company operations.
Nigeria has the world’s tenth-largest natural gas reserves, estimated at 125 trillion cubic feet. About 2 million cubic feet of gas is flared each day, more than elsewhere in the world. The Government is requiring producers to cease all flaring of gas by 2008. Much progress has been made on the expansion of a natural gas liquefaction plant and the construction of another plant. A West African pipeline is under construction as well.
Political Risks
Since the return to civilian rule in May 1999, there has been significant progress in restoring respect for basic human rights and civil liberties and in bringing market discipline to some sectors of the economy. Yet, parts of the country are plagued by communal disputes, a substandard infrastructure, and an ineffective and often corrupt bureaucracy and judiciary.
Labor
The Nigerian Government’s relationship with organized labor remains uneasy, especially over fuel prices, the minimum wage, and economic reform.
Political Violence
Violence in the Niger Delta region continues due to interethnic, economic, and political tensions. Kidnappings of Nigerian and expatriate oil service workers, mostly for economic reasons, continues. Workers taken hostage were released following negotiations between local communities, companies, and government officials. The Niger Delta Development Commission (NDDC), headquartered in Port Harcourt, established in December 2001 commissioned an overall development plan for the region. Many Nigerians believe the NDDC is not fulfilling its mission to alleviate poverty and protect the environment. Instead, these Nigerians believe these goals may be achieved through increased local control of oil and gas revenues.
There have been instances of violence in other areas as well: Plateau State, Taraba, Nasarawa, and Kaduna, for example.
Formal venues for business-to-government and business-to-business dialogue are not well developed. Most leading business executives have developed individual channels of communication with relevant government players.
The Political System
The Federal Government features a presidential executive and a bicameral national legislature. Each of the 36 States has a Governor and a unicameral legislature. Nigeria has an independent Federal judiciary, but the judicial branch has been greatly weakened by neglect and endemic corruption during the past years of military rule.
Marketing Strategies
As in most developing countries, personal ties and patience are key to successful business activity in Nigeria. The Nigerian market offers significant opportunities for U.S. exporters but a clear road map and a well thought-out business strategy are required.
Nigeria, the largest market in Sub-Saharan Africa, is a cash-based economy. In Nigeria, most transactions are paid for in (Naira) cash. Credit instruments such as credit cards are in their early stages of use. Two separate consortiums of 38 and 36 banks have been rolling-out two different credit card systems called “Smart Card” and “GEMCARD” in major cities such as Lagos, Port Harcourt and Abuja. The Smart Card Society of Nigeria was launched in April 2002. Industry watchers blame the widespread reluctance of individuals and corporate organizations to embrace e-commerce, and the absence of a reliable and robust credit system. Nonetheless, awareness and acceptance of Smart Cards as a veritable instrument of payment are on the rise.
E-Commerce
Industry analysts say that fewer than 20 percent of the Nigerian urban population use or know about the Internet. Recent trends, however, show an acceleration of IT-related businesses taking hold in Nigeria, particularly in urban centers.
Agents and Distributors
Concerning establishing a presence in Nigeria, some U.S. firms prefer an exclusive agent/distributor relationship with a locally registered company. Many foreign manufacturers and suppliers, however, opt to appoint more than one agent/distributor to accommodate Nigeria’s geographical size and ethnic complexities. In Nigeria’s complicated environment, all relevant terms and conditions of such arrangements must be carefully negotiated. U.S. firms interested in the Nigerian market are strongly advised to seek the assistance of experienced commercial lawyers. Enforcement of international property rights remains a problem in Nigeria despite official pronouncements and existing copyright laws.
Principles governing agency and distribution agreements are largely based on Nigerian case law established over many years. Key issues include:
Geographical area of representation
Duration of the agreement and the conditions under which it can be canceled or revised
Specific assignments
Right to refuse orders
Terms of payment
Restraints after termination to solicit sales from previous customers
Restraints on the use of registered logos, company product or brand names and trademarks
Selling Strategies
U.S. firms are permitted to package their products as they wish to secure the largest market share or to achieve the highest sales penetration for their products and/or services. Brand names or trade marks, however, are not allowed to be confusingly identical or so confusingly similar to a brand name or a label already on the market, as to be likely to lead to deception of the purchasing public.
There is public policy restraint on the use of trademarks, names or labels that are scandalous or not entitled to protection in a court of justice by virtue of their violation of law and morality. Commonly accepted names of chemical elements or compounds are not registered under the Nigerian Trademarks Act.
The Nigerian government requires firms intending to export food and drug products for sale in Nigeria to obtain a product license from the National Agency For Food and Drug Administration and Control (NAFDAC) before such products can be brought into and sold in Nigeria. U.S. firms may appoint a Nigerian attorney or elect their Nigerian business associates to file an application for a NAFDAC license on their behalf.
This requirement does not exclude the importation of such reasonable quantities of the products to be exported as samples in connection with the application for a product license. The rule states all drugs and chemical products should incorporate the common chemical or pharmaceutical name(s) of those products on the product label, including the brand name.
U.S. firms are advised to register all brand names and labels intended for use on products to be sold in Nigeria at the Trademarks Registry to guard against product counterfeiting and the “passing-off” of sub-standard goods as originals by local competitors.
Joint Ventures and Licensing Options
Apart from Nigerian government-owned enterprises, there are three forms of business recognized under the Allied Matters Act of 1990: companies, partnerships, and sole proprietorships. As foreign firms cannot operate through a branch office, potential U.S. manufacturers and suppliers must establish a place of business and incorporate within Nigeria in order to conduct business. According to the 1990 Act, establishment of a joint venture by itself is not sufficient to constitute a legal entity. A foreign firm can only participate as a shareholder in a local company incorporated for the purpose of the joint venture. Nigeria’s trade and investment promotion decree permits 100 percent ownership of firms locally incorporated and in Nigeria except businesses such as arms and ammunition, production military uniforms, etc contained in the so-called negative list.
Public Sector Marketing
The government of Nigeria buys products and services through a “tenders board” composed of senior government officials and may include local consultants or foreign firms with representatives in Nigeria. The Central Bank of Nigeria (CBN) does not buy products and services for the Nigerian government or its agencies. Inquiries and business proposals emanating purportedly from the CBN on behalf of the Nigerian government or any of its agencies should be disregarded.
Customs Regulations
The Nigerian government has reintroduced Destination Inspection (DI) abandoned in 2000 due to official corruption, which flawed its implementation. The replacement of Pre-Shipment Inspection (PSI) of imports with “100 percent” DI has compounded port congestion and delays in clearing of imports due largely to a lack of appropriate inspection equipment and confusing clearing procedure. However, the Nigerian government has announced an international tender for the supply and management of x-ray equipment for the 100 percent inspection of imports at the various ports. Despite mounting opposition especially from local importers whom the Nigerian government accuses of deliberate under valuation of imports and smuggling, the Nigerian government has vowed to stick to the 100 percent DI and the on-going port reforms.
The controversial port reform is an attempt to check official corruption at the ports, reduce continued diversion of Nigerian imports to Cotenou in Republic of Benin and shorten the time spent clearing imports through customs. Industry watchers are divided in their assessment of the merits and disadvantages of the port reform. Most people argue that whatever benefits the reform was intended to achieve have been wiped out by the very absence of appropriate equipment and functional systems at the ports, which is fueling official corruption - the evil the reform is intended to eradicate. Those who support the return of destination inspection argue that the rising wave of armed robbery and related crimes in Nigeria is due largely to massive importation of arms and ammunitions following lax pre-shipment procedure and falsification of import documents. Additionally, there were accusations of under-valuation of imports, a scheme most analysts believe is aided by corrupt Custom Agents and security operatives at the ports.
Over the past 23 years, the pre-shipment inspection has been a major source of revenue for the Nigerian government. Swede Control/Intertek (a joint venture between a U.S. firm and a Nigerian firm) was responsible for inspection of Nigerian imports originating from the United States.
Intertek Services International, Ltd.
3741 Red Blue Road
Pasadena, Texas 77503
Tel: (713) 473-2082
Fax: (713) 473-2083
Telex: 6868554 ISIUW
Contact: Eamoan Cooney, Contract Manager
The inspection agents are required to verify the following:
Tallying of imported goods to ensure that the correct container and volume of goods match and are accounted for especially for import duty Assessment
Reconciliation of details on import manifest, bills of lading, tallying records, etc.
Ensuring that accurate payment of duties and other relevant charges for all goods released have been made
Destination inspection requires verification of above documents and import claims at the port of entry in Nigerian. U.S. exporters are advised to ensure that their exports to Nigeria conform to the above import prescription.
The on-going port reforms are already yielding positive dividends, especially in terms of reduced numbers of security operatives (often accused of official corruption and bottlenecks resulting in long delays at the port), and the number of days its takes to process import duties and clear imports through customs and immigration. Currently, only the following agencies are permitted to operate under the supervision of the Nigerian Ports Authority:
Nigerian Customs Service (NCS)
The Port Police
Nigerian Immigration Service
Authorized licensed Customs Agents
The GON has directed that only the Federal Aviation Authority of Nigeria (FAAN), Customs, Immigration and Authorized licensed Customs Agent are authorized to inspect imports at the Nigerian airports.
In an attempt to check official corruption and long delays during clearing process at the ports, the Nigerian government appointed private auditing/accounting firms in 1998 to collect import and excise duties through some selected banks. Some of the banks include:
First Bank of Nigeria PLC
Afribank
Union Bank of Nigeria PLC
Universal Trust Bank
United Bank for Africa PLC
FSB International Bank
Diamond Bank Limited
The use of letter of credit for all imports valued more than $1,000 was made compulsory by the Nigerian government in 1994. Therefore, U.S. suppliers are advised to ship through an irrevocable letter of credit confirmed by a U.S. or a major international bank.
Advertising and Trade Promotion
Advertising plays a significant role in marketing products and services in the Nigerian market. However, due to limited communications links, especially in heavily populated rural areas, advertising strategies by U.S. firms should put emphasis on “below-the-line advertisements” (sales promotions including gifts and discounts). Agents and distributors of foreign suppliers and manufacturers usually expect promotional support such as subsidies and brochures to participate in trade shows.
The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) publishes an annual directory of trade shows in Nigeria. However, Nigeria’s international trade fairs may not be very effective in promoting highly specialized, technical products due to their emphasis on “general” products. Although a visit by a non-exhibiting U.S. exporter to an international Nigerian trade fair can help identify a potential agent or distributor, it is not required to penetrate the Nigerian market.
The Manufacturers Association of Nigeria (MAN) publishes a journal entitled “Who Makes What,” which reports on developments and opportunities in various sectors and provides commentary on the Nigerian economy. Additionally, it is an important source of information on the Nigerian market, and a useful medium in which to advertise products and services to the trade. Inquiries regarding the journal may be directed to:
The Manufacturers Association of Nigeria
72 Obafemi Awolowo Way, Ikeja
Lagos, Nigeria
Tel: (234-1) 266-0756, 266-8992, 266-8985
Business Magazines and Newspapers
Business magazines and newspapers distributed or published in Nigeria may be of use to U.S. manufacturers and suppliers.
Weekly/Monthly Magazines and Newspapers
African Technical Review of Business and Technology
Policy Magazine (Pro-Business)
Business Standard (Weekly Pro-Business)
Newswatch (Weekly Magazine)
Business Times (Pro-Business)
The Week (Weekly Magazine)
The News (Weekly Magazine)
The Source (Weekly Magazine)
IT Digest (Monthly)
PC World Nigeria (Monthly)
Federal Government Press
News Agency of Nigeria (NAN) is the government’s voice for news and opinion media in Nigeria.
Others
New Nigerian
Daily Times
Abuja Times
West Africa Magazine
State Government Press
Daily Star (Enugu)
Sketch (Ibadan)
Triumph (Kano)
Nigerian Standard (Jos)
Chronicle (Calabar)
Observer (Benin City)
Tide (Port Harcourt)
Ambassador (Umuahia)
Independent Publications
The Guardian (Nigeria’s Foremost Business Daily)
This Day (Dynamic And Nationwide)
Vanguard (Lagos Daily)
Champion (Daily, Pro-Eastern Nigeria)
The Diet (Daily, Pro-Business)
The Post Express (Daily, Pro-Business)
Sunray (Daily, Eastern, Partly American-Owned)
The Democrat (Daily, Northern Islamic, Pro-Government)
Tribune (Ibadan Daily)
Daily Trust/Weekly Trust (Most Read Newspaper in the North)
Import and Export Regulation Risks
Trade Barrier Risks
Nigeria established its current tariff structure schedule comprising 5,147 tariff lines on March 1, 1995. Under this structure, import duties ranging from 5 to 60 percent are levied on imported goods.
For pharmaceutical products, the importation of drugs and other regulated products through land borders is banned. Drugs will only be imported into the following ports:
Calabar Seaport - Finished drug products and pharmaceutical raw materials
Aminu Kano International Airport - Finished Drug Products and pharmaceutical raw materials
Murtala Mohammed International Airport, Lagos - Finished Drug Products and Pharmaceutical Raw Materials
Apapa Seaport, Lagos - Finished Drug Products and Pharmaceutical raw materials
Fruit juices can only be imported in concentrates and in drums (not in ready-to-drink retail packs). Other agricultural products had duties reduced from 15% to 5%. Other food items such as canned fish had duties slashed from 100 to 50 percent. The duty on processed sugar was reduced from 50 to 30 percent. With a c.i.f. levy of 5 percent on sugar imports, the effective duty on sugar is 35 percent. In a circular after the release of 2003 tariff amendment list, the following items were completely banned:
Toothpicks in any form
Table drinking water (spring or sparkling)
All types of biscuits
Spaghetti and noodles
Ice cream
For used vehicles, the ban on 5 year-old vehicles was extended to eight-year old ones due to a public outcry against this policy.
Most mineral products had duties reduced from 15 to 5 percent. For plastic and rubber articles, duties were raised 5 to 25 percent and in some cases as high 65 percent in line with the Nigerian government efforts to encourage and protect the growth of home industries. On the other hand, base metals needed by most local industries for manufacturing had their duties reduced from ranges of 30 - 20 percent to 5 percent. Duties on spare parts for electrical and recording appliances originally ranging between 40 and 15 percent were reduced to 5%. However, excise duties of 2002 remain in place.
The customs duty (tariff) levied ad valorem with no variable or seasonal tariffs:
A port surcharge of 7 percent on duty payable
A VAT of 5 percent levied on the c.i.f. value plus duty and other charges
A National Automotive Council tax of 2 percent levied on the c.i.f. value of imported vehicles and parts
A sugar levy of 5 percent applied to the c.i.f. value of sugar imports
A community levy of 0.5 percent for the Economic Community of West African States (ECOWAS)
An administrative charge of 1 percent levied on the f.o.b. value of imports
Nigerian banks appointed to collect duties by the government include the following banks:
First Bank of Nigeria Plc
Afribank Nigeria Plc
Union Bank of Nigeria Plc
Universal Trust Bank
United Bank For Africa Plc
FSB International Bank
Diamond Bank Plc
Zenith International Bank Limited.
Platinum Bank
Valuations on Imports
The Nigerian Customs and Excise Tariff utilizes the Customs Cooperation Council Nomenclature (CCCN). Duties are either specific or ad valorem, depending on the commodity, and are payable in Naira upon entry. Import tariffs are non preferential and apply equally to all countries. In addition, a local insurance company must insure all imported goods.
A special duty may be imposed on imported goods if the government feels that such goods are being dumped or unfairly subsidized, thus threatening established or potential domestic industries.
Duties previously paid on abandoned, re-exported, damaged, or destroyed goods may be refunded. However, a claim must be made before the goods leave customs custody. A destruction certificate must be obtained from a customs officer to obtain a refund of duties paid for goods that were subsequently destroyed.
Upon presentation of a customs certificate attesting to the landing of goods in another country, duties paid on such goods in Nigeria will be refunded.
Overpaid duties may be refunded upon application to customs within 12 months of importation. Nigeria is a signatory to the United Nations International Convention to Facilitate the Importation of Commercial Samples and Advertising Material.
Samples of commercial value may be imported duty free under bond. In practice, however, customs officials exercise considerable discretion in rejecting requests for duty free admission even in cases involving samples or patterns.
Licenses Required for Imports
Since Nigeria ceased issuing import licenses for importation of goods in 1986, importers must utilize Form “M”. Importers are required to open an irrevocable letter of credit after receipt of an approved revised Form “M” processed through their banks. Since September 1, 1999, all goods except personal effects, used motor vehicles and perishables (e.g. day-old chicks, human eyes, human remains, vaccines, and periodicals/magazines) imported into the country are subject to pre-shipment inspection in the country of origin. Used vehicles and perishables are exempt from pre-shipment inspection.
In May 2001, the Nigerian government ordered 100 percent inspection for all goods entering Nigerian ports and border stations, thus in effect canceling the pre-shipment inspection program already in place. Although destination inspection is currently going on, the policy is not fully established due to infrastructure problems.
Form “M”
There are two types of Form “M” -- “Valid for Foreign Exchange” and “Not Valid for Foreign Exchange”. Local banks responsible for processing a Form “M” are also responsible for delivering Form “M” to the Nigerian liaison offices of the appointed inspection agents. Usually, a Form “ M” and relevant pro-forma invoice must contain a proper description of the goods to be imported including relevant specifications.
Controls on Exports
At present, there is no export tax in Nigeria. The Nigerian Government prohibits the exportation of the following items:
Rawhides and skin
Timber (whether processed or not) and wood in the rough, excluding furniture component, railway slippers, floor and ceiling tiles, doors, windows and pallets
Raw palm kernels
Unprocessed Rubber and Rubber Lumps
Documentation Required for Trade
According to “Guidelines for Imports into Nigeria,” effective April 1, 1996 all imports into Nigeria must possess a Clean Report of Finding (CRF) and an Import Duty Report (IDR) to be cleared through customs. Previously, imports valued less than USD 1,000 and imports classified as personal effects were exempt from pre-shipment inspections. Designated accounting firms and banks work with customs as duty collection agents and banks have now replaced accounting firms as duty collectors.
Among other relevant points contained in the guidelines for importers:
A Form “A” will continue to be used with respect to import services (Invisible Trade)
A Modified Form “M” in sextuple should be used for all imports into Nigeria. The form is obtainable from all offices of the inspection agents, Nigerian embassies, local banks, branches of Nigerian banks overseas, and their correspondent banks. Three copies are to be sent to the pre-shipment inspection agents and one each to the importer’s bank, the Nigerian Customs Service and the National Maritime Authority (NMA).
Letters of credit or cash payments remain mandatory for imports into Nigeria. Checks from customer’s bank must be cleared before the original IDR and shipment documents are released to the importer.
The Guidelines’ key provision is that all goods imported into Nigeria must be accompanied by an IDR issued by the pre-shipment inspection agents. Goods without Import Duty Reports (IDRs) will not be released by the Nigerian Customs. Shippers/Carriers should ensure that cargoes/containers carried by them are pasted with a hologram or mark issued by the pre-shipment inspection agents. Once the Guidelines’ conditions are met, Nigerian Customs is obligated to release goods to importers within 48 hours.
Observers note little success to date in reducing red tape and corruption. The confusing situation at the ports has been worsened by the introduction of 100 percent destination inspection. Among other things, the destination inspection is aimed at checking a growing incidence of under-valuation of imports and smuggling, most specifically of arms and ammunitions. to reduce delays in the import clearing process, a Central Clearing System (CCS) has been introduced as a one-stop shop to replace the “long room” method, which most importers associate with corrupt practices.
Imports from the U.S. are inspected by:
Intertek Services International
3741 Red Bluff Road
Houston, Texas 77503
Tel: (713) 475 2082
Fax: (713) 475 2083
To claim any goods at Nigerian ports, the following documents must be presented to officials of the Customs and Excise Department:
Bill of lading
Bill of entry
Approved revised Form “M”
Marine insurance policy (issued by a Nigerian insurance firm.)
Certificate of quality from the exporting country for (food and drugs.)
Evidence of payment of VAT
Approved product quality and release certificate from the Standard Organization of Nigeria (SON)
Following is a detailed list of current regulations and paperwork requirements governing imports into Nigeria, effective April 1, 1996. They apply for all imports and collection of import duties in Nigeria:
Modified form “M” shall be used for all imports into Nigeria, and shall be in sextuplicate of which three copies shall be sent to the Reshipment Inspection Agents and one each to the importer’s bank, the Nigeria Customs Service and Nigerian Maritime Authority (NMA). Modified Form “M” is obtainable from all the offices of the inspection Agents, Nigerian embassies, local banks, branches of Nigerian banks overseas and their correspondent banks
Form ‘A’ shall continue to be used for imports of services (invisible trade).
The completed Modified Form “M” originating from abroad will be returned through the appropriate Reshipment Inspection Agents abroad to any of the designated banks or any bank of importer’s choice in Nigeria.
Letters of Credit or Cash Payments are mandatory for imports into Nigeria.
All containerized and non containerized goods, irrespective of value, are subject to pre-shipment inspection.
Issuance of Clean Report of Finding (CFR) and Import Duty Report (IDR) are mandatory for all imports, including accompanied personal effects.
All imports into Nigeria must be accompanied with the relevant IDRs. Imports for which IDRs are not produced will be confiscated, the importer prosecuted and the shipping lines/carriers will be liable to a fine not exceeding the value of the goods.
Pre shipment Inspection Agents (PIAs) must forward a copy of the Import Duty Report (IDR) directly to the importer’s local bank or the bank to which the Form ‘M’ was originally sent, another copy to the designated bank, and a third copy to the Nigerian Customs Service.
It is the duty of the importer’s bank or the bank to which the Form ‘M’ was sent to issue a certified check for the amount stated on the IDR to the customer who shall pay such check to any of the design
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