Govt Losing $8.810b Yearly To e-Customs Row

Nigeria is losing $8.810 billion annually to the non-take-off of the $3.1 billion e-Custom mordenisation project, it was learnt yesterday.

Finance, Budget and National Planning Minister Mrs. Zainab Ahmed, who appeared before the House of Representatives Joint Committees on Customs and Excise, Finance and Banking and Currency, blamed situation on a chain of suits against the government.

He told members of the committees that the government has three suits filed against it by Messrs Adani Nigeria Limited, the contractor initially franchised to handle the project.

The e-Custom mordenisation project is expected to fetch the government about $176.2 billion for the over 20 years at an average of $8.810 billion annually

In October last year, Green Chamber directed its committees on Custom and Excise, Banking and Currency as well as Finance to investigate and resolve the issues affecting the take-off of the project between the Centeral Bank of Nigeria and Adani Mega system.

The minister told the committees that the contract awarded by the Technical Committee on Comprehensive Import Supervision Scheme (TC-CISS) of the CBN on March 20, 2017, was cancelled by the same body on the September 18 of the same year after further due diligence.

She said: “In a letter Ref. TED/DIR/GAM/GEN/01/025 dated 18th the September, 2017, the technical committee cancelled the agreement following further due diligence which revealed that the technical partners of the Company (Messrs. Adani International Ltd) a company registered in the United Kingdom (UK) that did not possess the required expertise in relation to the project field nor proven track record in the execution and operation of projects in the field covered by the contract.

“The technical committee noted that the misrepresentations were material breaches that affected the company’s integrity, capacity and competence to deliver on such a project given its importance to the Nigerian economy.

“Expectedly, Messrs. Adani Mega Systems Limited (ASL)in an effort to validate its contract with TC-CISS instituted cases in courts against the Federal Government of Nigeria for breach of contract allegedly entered into between it and the technical committee on the Comprehensive Import Supervision Scheme (TC-CISS).

“Presently, there are three active cases before the court on the matter at the instance of the Company as listed as Suit No: FHC/ABJ/CS/850/2017 Adani Mega Systems Limited vs the AG of the Federation & 3 Others; Suit No: FHC/ABJ/CS/1156/2020 – Adani Mega System Limited vs HAGF and 3 Others and Suit No: FHC/ABJ/CS/860/2020 – Adani Mega System Limited vs Air Wave Limited & two others.”

She said Messrs Adani Mega Systems Limited argument was that the substance of the contracts awarded to E-Customs HC Project Limited and Airwave Limited are the same with the one awarded to it.

“The crux of all the cases still connect to the first case – parties are at a stage where there is need to address the Court on whether all the cases, apart from the one at the arbitration, before the Attorney-General of the Federation should be transferred to the same judge so that they can either be heard simultaneously by the same Judge or be consolidated, since they are all sister cases. One of the cases comes up on the in March 2022.

“There is no doubt, the pending cases are impeding the commencement of the e-Customs project. In order to pave the way for the take-off of the project, the Ministry is liaising with the Office of the Attorney General of the Federation to ensure that the arbitration is speedily concluded. This we believe could settle all the pending matters and allow the E-Customs project to commence without further delay.”

Comptroller-General of Nigeria Customs Service, Col. Hameed Ibrahim Ali said Adani Nigeria Limited were supposed to be prosecuted for presenting false information to obtain contract.

He also said that the contract with the company was awarded by a committee of the CBN with the knowledge of Finance ministry and the NCS.

According to him, the House Committee in the Eight Assembly investigated the matter and made its recommendations.

Col. Ali, however, said that the NCS found out that Messrs Adani Mega Systems Limited outsourced the agreement to an unauthorised third party Adani International Limited (UK), a company registered four months after the agreement was signed.

He said Adani International Limited (UK) has since been dissolved, adding that the assertion by Adani Mega System Ltd that its international partner has a proven track record, capacity, expertise and competense to execute and operate within the project field covered by the agreement was false and misleading.

Chairman of the House Committee on Custom and Excise, Leke Abejide, lamented what he called back and forth on the e-customs modernisation project with an objective to automate Customs administration.

He said the cost of concession implementation over a 20-year period is put $3.1 billion and projected to generate about $176.2 billion.

“We equally understood the SPV is to recover their investment based on negotiated and staggered recovery strong ratio from the Comprehensive Import Supervision Scheme (CISS) and Nigerian Export Supervision Scheme (NESS),” Abejide said.