1. >>>>> www.cotecna.com Nigeria Destination Inspection Scheme Presentation to the West Africa Trade & Transport Seminar Thursday 4 th May, London Sue Keen Documentation Manager, Cotecna UK

2. >>>>> www.cotecna.com Presentation Content > Outline of DI scheme >Type of contract >Who is involved >How it works from start to finish > Current issues (as we understand them) >Form M opening >Processing of final documentation

3. >>>>> www.cotecna.com Agencies involved > Three Scanning and Risk Management Service Providers (SCs) have been appointed > Each SC has a 7 year BOOT contract >Build Own Operate Transfer > Each has been allocated specific ports of entry (sea, air & land) unlike PSI which was determined by country of supply

4. >>>>> www.cotecna.com Agencies involved > Cotecna >Seaports – Apapa,Tin Can Island >Airports – Kano, Abuja; Land Borders – Jibiya, Banki > SGS >Seaports – Onne, Port Harcourt >Airport – Port Harcourt; Land border – Idiroko > Global Scan Ltd >Seaports – Warri, Calabar >Airport – Ikeja (MMA); Land borders - Seme

5. >>>>> www.cotecna.com Outline of process > Exporter raises proforma invoice (PFI) and sends to Importer > Importer raises form M at authorised dealer (bank) using PFI and other required documents (specific licences, insurance certificate etc) > Authorised dealer sends the form M and associated paperwork to the relevant SC within 5 days of opening

6. >>>>> www.cotecna.com Outline of process > SC approves or rejects the form M application within 1 working day of receipt from authorised dealer > SC returns rejected form Ms to the authorised dealer with reason (or reasons) for rejection > Authorised dealer is responsible for informing importer – no goods can be imported until the form M is approved

7. >>>>> www.cotecna.com Outline of process > SC sends details of approved form Ms to Customs Headquarters and Customs Area Command at the relevant port of entry (sea, air or land) > Goods shipped - exporter submits final documents – who to depends on specific details (ie valid for forex, personal effects etc) > Authorised dealer sends final documents to the appropriate SC

8. >>>>> www.cotecna.com Outline of process > SC checks all final documents received and approves if acceptable or rejects if not acceptable > If documents are rejected they are returned to the authorised dealer > It is the authorised dealers responsibility to notify the importer and arrange rectification

9. >>>>> www.cotecna.com Outline of process > For approved final documents SC generates a Risk Assessment Report (RAR) >Within 5 days for sea shipments >Within 2 days for air / land shipments > The RAR includes the SCs opinion on: >customs classification >valuation >recommended intervention level

10. >>>>> www.cotecna.com Possible intervention levels > Green channel >No inspection – direct release > Yellow channel >Scanning by SC responsible for that port of entry (sea, air or land) > Red channel >100% physical inspection by Nigeria Customs Service

11. >>>>> www.cotecna.com

13. Image of a scanned container

14. >>>>> www.cotecna.com Outline of process > RAR is printed on plain paper >Customs copy issued to port of entry (sea, air or land) >Importers copy sent to bank > RAR data is also transmitted by EDT to NSC Asycuda system > Importer collects RAR from their bank and submits Customs Entry to NCS

15. >>>>> www.cotecna.com Outline of process > NCS assess duties and taxes and any other charges payable > They use the information in the RAR but do not have to accept the SCs customs classification or valuation > NCS determines the intervention level – they do not have to accept the recommendation made by the SC

16. >>>>> www.cotecna.com Outline of process > Consignment progresses through the chosen intervention level once the importer has paid the duties & taxes to the designated bank > Green Lane – Direct Release >Release Order (RO) printed by Customs after duties & taxes paid >Importer presents RO to Nigeria Ports Authority (NPA) – pays port charges >Consignment released

17. >>>>> www.cotecna.com Outline of process > Yellow Lane – scanning >Authorisation to Load for Scanning (ALS) issued by Customs after payments confirmed >Container scanned >If discrepancy – container moves to Red Lane for full physical inspection by NCS >If satisfactory – RO printed >Importer presents RO to Nigeria Ports Authority (NPA) – pays port charges >Consignment released

18. >>>>> www.cotecna.com Outline of process > Red Lane – physical inspection >If discrepancy – two options >NCS may seize the cargo – importer loses goods which are either destroyed or sold at auction >NCS issue an Assessment Notice (AN) detailing additional duties, taxes and penalties to be paid >Importers pays additional charges; RO printed >If satisfactory – RO printed >Importer presents RO to Nigeria Ports Authority (NPA) – pays port charges to NPA >Consignment released

19. >>>>> www.cotecna.com Current Issue – Form M rejection > Cotecna rejections: >1 Jan to 25 Apr – 23% of form Ms rejected >Reasons for rejection are varied > Some problems stem from the authorised dealer; others are caused by the importers > Some are caused by the exporter in the production and submission of their proforma invoice

20. >>>>> www.cotecna.com Reasons for form M rejection > Authorised dealer >Late submissions to the SC (after 5 days) >Not signed, dated, stamped (ie authorised) >Wrong bank code / numbering or prefix (duplicates, too many or too few digits, exempt) > Other required documents not provided >For example: NAFDAC, NEPA licences; SONCAP paperwork; Insurance Certificates

21. >>>>> www.cotecna.com Reasons for form M rejection > Conflicting information where details quoted on the form M do not match attached documentation >Exporter details >(names, addresses, phone/fax numbers) >Values (FOB, Freight etc) >Countries of origin and supply >Port of entry (sea, air or land)

22. >>>>> www.cotecna.com Reasons for form M rejection > Proforma invoices not acceptable >Full exporter details must be given >Insufficient description of the goods >Generic product name; brand name where applicable >Model name or number where applicable >Description of the quality, grade, specification, capacity, size etc >Other missing information >Quantity, packaging or packing; unit prices; freight >Country of Origin and/or supply >PFI expired (now only valid for 3 months)

23. >>>>> www.cotecna.com Proforma invoices > Why do PFIs have to be so detailed? >This is the only information the SCs have to complete price analysis and perform customs classification >Failure to provide this detail may result in goods being incorrectly classified and valued >This in turn may result in an incorrect RAR being issued which may delay clearance

24. >>>>> www.cotecna.com Current issue – final documents > Cotecna rejections >1 Jan to 25 Apr – 23% rejected >Reasons for rejection are varied > CCVOs >Information inconsistent with form M (currency, different exp/imp; higher quantities or values) >Do not add up correctly >No number or date; missing freight values >Missing or incorrect unit prices quoted

25. >>>>> www.cotecna.com Current issues – final documents > Transport documents >Missing completely >No dates or numbers >Container information not quoted >Name of vessel, port of loading and port of discharge missing >Inconsistent with other documentation

26. >>>>> www.cotecna.com What can exporters do to help? > Improve the quality of data in proforma invoices >This will stop the form Ms being rejected >This will stop delays in L/Cs being opened >This ensures that goods can be shipped quickly > Improve the quality of data in final documents >This will stop the documents being rejected >This will stop delays in the issuance of the RAR >This will stop delays to your customer getting his goods

27. >>>>> www.cotecna.com Thank you