Nigeria News

NIGERIA: Pay Your Tax, Senate Committee Tells NLNG

The Senate Committee on Marine Transport Tuesday asked the Nigeria Liquefied Natural Gas (NLNG) to fulfill its tax obligations to the Nigerian Maritime Administration and Safety Agency (NIMASA).

This directive was given by the committee during its meeting with the two government agencies and relevant stakeholders at the National Assembly Tuesday.

NLNG is alleged to be owing NIMASA a whopping sum of $158 million.

The tax includes the three per cent gross levy on freight (in-bound and out-bound) cargo ships, two per cent surcharge on cabotage levy as well as sea protection levy charged on all foreign flagged ships arriving at the nation’s ports.

Earlier, President Goodluck Jonathan had directed the Attorney General and Minister of Justice, Mohammed Adoke, to intervene in the rift between the agencies with a view to resolving it.

In the course of the intervention, NLNG was asked to liquidate the debt in instalments.

Consequently, the NLNG paid the initial $20 million but refused to complete the repayment and instead, opted to return to court to contest the payment.

Speaking at Tuesday’s meeting, a member of the committee, Senator Benedict Ayade (Cross River North), demanded the reason NLNG as a corporate body owned jointly by the federal government and some international oil companies was failing to meet its tax obligations.

The meeting was attended by stakeholders from the Nigerian Ports Authority (NPA), Shippers Council, Maritime Authority of Nigeria (MAN) and officials of the Ministry of Transport.

The lawmaker said if international oil companies always pay taxes in their home countries, “I see no reason why they pay taxes in their countries and will not want to pay the Nigerian government.”

He commended the courage of the Director General of NIMASA  to take up NLNG, assuring him that he has “the full backing of the Senate: “The committee will want to be fully clarified on this issue so as to pull more weight with NIMASA in generating more revenue for the federal government of Nigeria.”

Meanwhile, Justice Mohammed Idris of the Federal High Court in Lagos Tuesday fixed July 12 for ruling on the lingering dispute between NLNG and the NIMASA over an alleged failure to make some statutory charges to the federal government.

Justice Idris is to rule on two preliminary objections filed by a private firm, Global West Vessels Specialists, challenging the jurisdiction of the court to adjudicate on the suit as well as the commencement of contempt proceedings.
Global West was sued as an agent of NIMASA alongside the Attorney General of the Federation (AGF).

Arguing the objections, Global West’s lawyer, Abiodun Owonikoko (SAN), urged the court to dismiss the suit on the ground that proper parties were not sued as defendants.

He said the court had been robbed of jurisdiction owing to the fact that the suit was incurably defective.

According to him, “The Supreme Court has held in a plethora of cases that this kind of case cannot go on against us in the absence of NIMASA.

“The deliberate failure of the plaintiff (NLNG) to sue NIMASA is aimed at circumventing Section 53 (2) of NIMASA Act which mandates them to file a pre-action notice.

“At this stage, that error is fatal to the case of the plaintiff and it cannot be rectified by amendment or joinder.

“My Lord, even the AGF is not a proper party to this suit as the Supervisory Minister for NIMASA is the Transport Minister. So, in essence, NLNG has failed to sue the proper defendants.”

On the commencement of contempt, Owonikoko said NLNG failed to comply with the proper procedures, as same was served on one Romeo Itimi, who died in 2012.

Replying, NLNG’s lawyer, Wale Akoni (SAN), said the case of his client was primarily against the federal government and its agents, and that AGF could be sued in any matter involving the federal government.

Akoni further insisted that the contempt proceedings were commenced in line with the rules of court.

He relied on a publication in Daily Independent Newspaper where NIMASA announced that it had blocked the vessels of NLNG using Global West Vessels, adding that the said Global West was rightly sued as a defendant in the case.

According to suit, NLNG is claiming $37 million damages against the defendants jointly and severally over the said blockade of its vessels.

Justice Idris had on June 18 granted an ex-parte order restraining the defendants from charging, imposing, demanding or collecting the three per cent of gross freight earnings or any other sums further to Section 15(a) of NIMASA Act 2007 on all of NLNG’s international
inbound or outbound cargo ships owned, contracted or subcontracted by it.

On Monday, Justice Idris struck out two separate applications filed by the AGF and Global West asking that the ex-parte order should be discharged.

The judge, however, refused to reaffirm the ex-parte when asked to do so by NLNG’s lawyer, Akoni.

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