Nigerian courier industry: LCCi picks regulations Gov must delete, and why

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The Lagos Chamber of Commerce and Industry (LCCI) has called on the Honourable Minister of Communications & Digital Economy, and indeed the Federal Government to take urgent steps to clean up provisions in the courier regulations and guidelines  that are stifling and suffocating the industry. 
LCCI, applauded the the Honourable Minister of Communications and Digital Economy, Dr. Isa Pantami, to have promptly reversed the increase in licence and renewal fees imposed on courier companies by Nigerian Postal Service (NIPOST). 
We commend him for that swift response,  however, beyond the fees, there are other fundamental regulatory issues that the Hon Minister needs to urgently address,” said Dr. Muda Yusuf, Director- General of LCCI.
He said that the regulatory issues include: * A framework in which NIPOST is both a regulator and operator is detrimental to the development of the courier business in the country. This is inconsistent with best practice principles of business regulations globally.
“Currently NIPOST is vested with powers to regulate its competitors. This arrangement is unfair, inequitable, and inherently repressive. It is a negation of the ease of doing business policy of the Federal Government and inconsistent with the extant competition law of the federal republic of Nigeria. We therefore urge the federal government and the National Assembly to urgently remedy the situation.
“The LCCI has strong reservations over a provision in the courier regulation guidelines which prescribes that “an operator of courier and logistics services shall contribute a sum equal to 2% of its total annual revenue to the Postal Fund which sum shall be used for postal development and delivery of postal services in rural and underserved areas.”
‘We submit that this provision will put too much burden on courier and logistics businesses and make them unsustainable,” he said.
“These businesses are already grappling with multitude of taxes and levies in the course of their daily operations.  We request that this provision be expunged immediately in the interest of investments and investors in the courier and logistics sector of the Nigeria economy.
” Also of concern is the provision in the Courier regulation which vests the Minister with powers to compel any licensed courier and/or Logistics Services Operator to undertake free delivery service for the purpose of Universal Postal Service Obligations/or any Social Service Delivery in National Interest needs to be reviewed.  It borders on overbearing powers with little regard for the interest of investors.”
“Another  issue is the provision in the Courier regulation which stipulates that: “All courier items/articles such as Right Issues, Shares Certificates, Statement of Accounts, Cheques, Letters or Offer documents, etc weighing below 0.5kg brought to a Courier/Logistics service operator shall be recorded and referred to the nearest Post Office of the Nigerian Postal Service for processing and delivery. Failure to do so will attract payment to Nigerian Postal Service of a penalty of 90% of the amount charged on the item by the erring Operator.”
Again, this is an unfair provision.
“The citizens should not be compelled to patronise NIPOST against their will, irrespective of the size or weight of the items. Indeed, it is an infringement on the rights of citizens and in conflict with the principle of fair.  It is a revolting provision which the Honourable Minster for Communications needs to immediately expunge.
“It is also important to clarify whether NIPOST or its parent Ministry has powers to regulate the business of Logistics in the country.
“The current NIPOST Regulation and Guidelines made copious reference to the business of Logistics,” said LCCI.
The Nigerian courier industry is one of the most troubled sectors of the Nigerian economy at this time. Prior to Covid 19, the sector had been grappling with the following challenges:
• The sector is a major victim of disruptions foisted by the increasing adoption of digital technology as a dominant medium of information transmission.
This include emails, text messages, social media platforms, etc. This has drastically reduced the demand for physical delivery of information.
This include letters, greeting cards, dividend warrants, annual reports, academic certificates, examination results, among others. The impact of this disruption is very profound.
• Incursion into the business by many informal and unregistered operators, undertaking delivery of mails and parcels across the country, especially commercial vehicles that ply inter-state routes.
•Escalating cost of logistics resulting from high transportation cost, absence of functional railway system and poor road networks, among others.

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