Indigenous Shipping Firms to Be Boosted By New Bill
 1st OCT 2006

Federal Government of Nigeria may soon introduce another cargo preference version aimed at encouraging the emergence of national carriers. The new cargo preference version was contained in a draft bill that would provide legal justification to the existence of the National Maritime Administration and Safety Agency (NAMASA).

According to the bill now before the National Assembly for consideration, freighting of all cargoes belonging to the federal, states and local governments may have to be reserved for the indigenous carriers to be registered by NAMASA.

The bill, which has already scaled through the first reading at the House of Representatives seeks to reserve the carriage of export and import cargoes belonging to all tiers of government, including their companies and agencies to national carriers.

Section 52 of the draft bill also made it mandatory for government and the national carriers to give Nigerian shippers incentives that would enable them patronise the national carriers that may emerge from the new policy. The draft bill also stated the quality of a national carrier to benefit from the cargo reservation policy, saying such carriers should be fully owned by Nigerian individuals or own at least 60 per cent of equity shares of the national carrier company. Besides, the Nigerian owner would need to own at least 60 per cent share of any vessel owned by the company and that the company would have to be registered in Nigeria.

In addition to the ownership condition, the law when passed would make it mandatory for any shipping firm to benefit from the impending policy to own vessels that operate on international route - deep sea navigation and not mere navigation on the country's coastal or inland waterways.

The bill gave other qualities of a national carrier to benefit from the coming dispensation as:

• That the head office of the shipping company should be located in Nigeria just as the management and control of its vessels are directed from its Nigerian office;
• that the carrier company owns at least one ocean-going vessel of not less than 5,000 net registration tonnage;
• that the terms and conditions of the employment of seafarers engaged by the company are in conformity with Nigerian rules and standards;
• that the company's vessels are registered in the Nigerian ship registration office and the vessel satisfy all conditions stipulated in the Merchant Shipping Act; and,
• that 100 per cent of the crew and at least 75 per cent of the shipboard officers, including the captain and chief officers and whatever chief engineers are Nigerians.

The bill, which from all indications is meant to promote the emergence and growth of indigenous shipping companies also reserved the right to participate in the carriage of liquid and bulk cargoes in line with UNCTAD Code of Conduct for liner conference.

Specifically, it said subject to the UNCTAD Code of Conduct for liner conference, "the participation of national carriers in the carriage of bulk cargo to and from Nigeria shall not be subject to a carriage right of not less than 50 per cent of such cargo."

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