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Nigerian Shippers’ Council has powers to regulate terminal operators —Appeal Court

The crux of the appellants’ case is the definition clause of Exhibits NSC-1 (The Lease Agreement dated June 3, 2003) in respect of Break Bulk Terminal ‘D’ at Apapa Port made between ENL Consortium LTD (2nd Appellant) and representatives of the Federal Government, the Nigerian Ports Authority and Bureau of Public Enterprises, which defined the functions of a regulator (the Appellants challenged the validity of the 1st Respondent as Economic Regulator for Nigerian Ports) to reduce costs of doing business at the ports and making it more user-friendly. Exhibit NSC-2 is the letter of the Minister of Transport dated  February 20,  2014 which conveyed the approval of the Defendant as the Economic Regulator of Nigerian Ports by the President of Nigeria.

In Exhibit NSC-1,  a regulator was defined as “Any Government Authority of Nigeria established, assigned, chartered or commissioned to regulate and control the development and/or conduct of Nigeria’s Maritime Industry, including without limitation, the Lessor and the Port.”

The implication of the above definition of “Regulator” as contained in Exhibit NSC-1 as agent or authority appointed to regulate the activities at the port qualifies as Regulator, as rightly argued by the learned counsel to the 1st Respondent. The definition of a Regulator as deposed to in the appellant’s reply affidavit is different from the definition clause of Exhibit FA2 which the Appellants regarded as a Standard Copy of the agreements.

The Appellants relied on Section 7(b) of the NPA Act to insist that the NPA is the Economic Regulator of Nigerian Ports. Section 7(b) of the NPA Act provides as follows:

  1. “The main functions of the Authority shall be to (b) Maintain, improve and regulate the use of the ports.” The above provision deals with the maintenance and use of the ports.

It did not empower the NPA to determine and fix the chargeable rates by Terminal Operators like the appellants on services rendered by them at the port. There is no statutory provision or agreement appointing the NPA an Economic Regulator of the ports to curb excess charges as argued by the learned Senior Counsel to the Appellants. The agreements relate to physical maintenance and use of the ports. The appellants had argued that the agreements they entered into only recognised the NPA as their only regulator.

But Section 5(1) (b) of the Constitution allows the President to execute and maintain all matters within the legislative competence of the National Assembly. It was in the exercise of the President’s executive powers that the appointment was made to check the excessive loss of revenue from the Maritime Sector caused by the appellant’s increase of progressive storage charge and reduction of the free storage period from seven(7) days to three (3) days. The 1st Respondent’s appointment as the Economic Regulator of the ports was made to curb the appellants’ excesses and curtail the huge losses on the ports of Nigeria by importers using other coastal lines in the West African region.

I am at one with the finding of the trial court that the appointment of the 1st Respondent as Economic Regulator did not contravene the provisions of the NPA Act or any clause in the agreement. The learned trial judge was right to have held that the appointment of the 1st Respondent as an Economic Regulator, how it conflicts with the Nigerian Ports Authority Act and the Regulations has not been established by the appellants.

Also that the powers are additional powers which complement the statutory functions/powers of the 1st Respondent which plays an advisory role to the Government in order to achieve the objectives of the Act. The major role is to protect the interest of the port users and Maritime Service providers which would enhance economic growth for Nigeria. Its role is also advisory in nature as a Statutory Agent for the protection of the interest of the Shippers.

The functions of the 1st Respondent’s appointment as Economic Regulator for Nigerian Ports by  a letter dated  February 20, 2014 with Reference No. T4252/SA/T/47 (Exhibit NSC-1) are well outlined which include to regulate, monitor and enforce the standard for service delivery, provide guideline on tariffs and to review/modify charges imposed to alter or disrupt the economic progress of the ports amongst many other functions.

As rightly found by the lower court, the National Assembly has not made any law to check the leakages in revenue accruable to government from the Maritime Sector due to the activities of the appellants, the 1st Respondent was appointed as the Economic Regulator of the ports to regulate and enforce all existing agreements.

A look at “the Notice,” it is clear that it is not a “review or modification or increase of charges or introduction of new charges” as alleged but, it is a directive urging the appellants to revert to the approved rates contained in the Minister of Transport’s letter of May 15, 2009. As rightly argued by the learned counsel to the 1st Respondent, it is not subject to the statutory requirement of prior negotiation and agreement with the Appellants within the context of Section 3(f) of the NSC Act and Regulations 1 and 2(1) of the 1997 Regulations.

The Notice was not issued under the 1st Respondent’s powers under the NSC Act and Regulations but, pursuant to its appointment as Economic Regulator. Therefore, there was no wrong exercise of statutory powers as alleged by the appellants, the case of INAKOJU VS. ADELEKE (supra) and the cases cited along the same line do not apply.

The questions the appellants sought to be determined by the lower court are centered around the business of the concession agreements; these formed the appellants’ issues 1-4 in this appeal while issues 6-8 were on evaluation of evidence, where the same points on the agreements were re-argued. Issue 7 dwelt on the same terms of the concession agreements. The reliefs sought are declaratory in nature except relief 7 which sought for a perpetual injunction. The appellants in this appeal are challenging the Notice and its purpose.

The Notice was not issued by NSC pursuant to its powers under the Nigerian Shippers’ Council (Local Shipping Charges on Imports and Exports) Regulations, 1997 but, the 1st Respondent’s appointment as earlier held in this judgment was at the Port Economic Regulator which is not traceable to the 1997 Regulations, See, NSC-2, pages 210 to 211 of the printed records and paragraphs 15-19 of the 1st Respondent’s Counter Affidavit.

(Abridged version).



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