Business

Automotive Law: We are Only Being Smart, Says Stallion Group

The Senate Committee on Investment yesterday commenced probe into the allegations by Nigeria's auto firms that Stallion Group of Companies was privy to information on the new automotive policy at the expense of others.
 
According to the firms, the policy which was adopted by the federal government on October 2, gave  Stallion Group a competitive edge over other local dealers having been privy to it before its introduction.
 
 
Stallion Group, which is the major importer of Honda, Nissan, Hyundai, Volkswagen and Audi brands, drew the ire of its competitors following accusations that it took advantage of information at its disposal to secure credit letters to the tune of $382 million covering three years of imports of 20,000 cars.
 
They argued that the move was aimed at exploiting the policy, which hiked car tariff from its current 20 per cent to 70 per cent and billed to take off in February next year.
 
At a public hearing organised by the Senate Committee on Investment yesterday, its Chairman, Senator Nenadi Usman, did not mince words to say: "The committee has received figures of vehicle imports over the years and we will go back as a committee and do our verification. Clearly, stakeholders have no problem with the auto policy, but have reservations on the manner of implementation, I think that is why we are here."
 
But the Managing Director of VON Automobile Nigeria Limited, Mr. Tokunbo Aromolaran, while speaking on behalf of the Stallion Group of Companies, described the allegations as false.
According to him, stakeholders in the automotive industry were already aware of the planned automotive policy, saying Stallion Group was only being smart and proactive by its foresight ahead of 2014 business year.
 
He criticised suggestions by some stakeholders that the policy be deferred.
"In business, when information comes, you can either act on it or otherwise. How fast you move is a function of how fast you are. There will never be a right time to start an automotive policy… over the six months, Nigerians will be provided with low cost vehicles," Aromolaran said.
 
But Auto Manufacturers' Representatives Group in Nigeria led by the Proprietor of Elizade Motors, Chief Michael Adeojo, who said his group was not opposed to the policy, insisted that the timing was wrong and therefore sought extension by two years.
 
"There have been three failed attempts at motor manufacturing. The fourth must not fail. Implementation of the auto policy should wear a human face. We are not opposed to this policy, but we are not agreeable to the way it is to be implemented," Adeojo said.
 
According to the policy, the duty on fully built units passenger cars is between 20 and 35 per cent, while a 10 per cent flat rate has been imposed on commercial vehicles.
The automotive policy has raised the duty on passenger vehicles to 70 per cent and 30 per cent for commercial vehicles.
 
Responding, Minister of Trade and Investment, Olusegun Aganga, said all stakeholders were carried along before evolving the policy.
He assured that the government would be fair to all.
 
But Nigerian Associations of Chambers of Commerce, Industry, Miines and Agriculture (NACCIMA) which supported the policy, asked for 18 months of grace before implementation, noting that without adequate time, the policy will promote corruption and continuous smuggling of old cars as a result of porous borders.
 
Also yesterday, the Joint Senate Committee on Communication organised a public hearing on a bill seeking to prohibit and punish electronic fraud and crime.
The bill is sponsored by Senator Gbenga Kaka (Ogun East).
 
While declaring the hearing open, Senate President David Mark, said: "The bill is not just important but a delicate one. It is not an ordinary bill, it is not a bill we can just grab with both hands as an acceptable bill. What this bill is saying is that they can monitor your phone conversation and who knows what it is going to be used for?
 
"The bill is trying to say that, 'well, if they suspect that I am a terrorist, then they can begin to monitor my phone because the emphasis for pushing this bill is because of terrorism but that is not the only thing that people get phone calls for.
 
"Millions of citizens make genuine phone calls that have nothing to do with national security.  So, on that basis, the excuse for national security, people should not go and tap on telephone lines and listen to conversation,  then you are breaching the very fundamentals on which democracy is set up," he said.

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