Experts fault container disposal practices, warn of $600m revenue loss

The disposal of empty shipping containers by foreign shipping lines operating in Nigeria has come under fresh scrutiny following claims that the practice may have deprived the Federal Government of more than $600 million in customs revenue over the years. A maritime trade consultant, Mr. Okey Ibeke, therefore called on the Nigeria Customs Service (NCS) to investigate the sale of containers imported under temporary admission arrangements, warning that widespread non-compliance with customs procedures could be resulting in significant revenue leakages. Speaking at a press conference in Lagos, Ibeke cited reports that one of the leading shipping Agencies plans to sell more than 2,500 empty containers located in the country. According to him, the containers are reportedly being offered at prices ranging between $1,600 and $2,000 per unit, with payments to be made in U.S. dollars through domiciliary accounts. He argued that the proposed transaction raises questions about compliance with customs regulations governing temporary imports and the Federal Government’s efforts to curb the dollarisation of domestic transactions. “Under Nigeria’s temporary importation regime, shipping containers enter the country duty-free on the condition that they will be re-exported after use. Before they can be legally sold within Nigeria, the containers must be converted to permanent import status through a process that includes customs valuation and payment of applicable duties, taxes and levies. “Any sale conducted without completing these procedures could amount to a breach of the Nigeria Customs Service Act 2023 and result in the loss of government revenue,” he said. He estimated that the Federal Government stands to lose between $350 and $400 in duties and taxes on every container sold without proper customs conversion, adding that based on the reported sale of 2,500 containers, potential revenue losses could approach $1 million from a single transaction. The trade expert, however, described the issue as an industry-wide challenge rather than an isolated case involving one operator. “Nigeria’s persistent trade imbalance, characterised by high import volumes and relatively low containerised exports, has led to the accumulation of thousands of empty containers at ports and inland locations across the country. “With shipping lines facing high costs to reposition empty containers back to Asia and Europe, many are reportedly disposed of locally” he said. Ibeke estimated that as many as 250,000 containers may have been sold or converted for local use over the past three decades. Using an average value of $1,500 per container, he said the cumulative loss of customs duties and value-added tax could exceed $375 million, while broader estimates put the figure at more than $600 million when penalties and related charges are considered. Beyond the revenue implications, he expressed concern over the reported practice of invoicing container sales in U.S. dollars, warning that it could undermine efforts by the Central Bank of Nigeria to strengthen the naira and reduce pressure on foreign exchange demand. He urged the Comptroller-General of Customs to suspend ongoing sales of temporary import containers pending investigation and to conduct a comprehensive audit of shipping lines and agents that have handled such containers over the years. The consultant also called for the reconciliation of port exit records with customs import data to determine the number of containers that were re-exported, formally converted to permanent import status or disposed of without regulatory approval. He further urged the government to recover any outstanding duties, taxes, levies and penalties arising from identified violations and to sanction operators found to have breached customs regulations. According to him, addressing the issue would not only boost government revenue but also strengthen regulatory compliance, enhance transparency in the maritime sector and support broader economic reform efforts aimed at improving Nigeria’s fiscal position.