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Members of the Federal House of Representatives yesterday passed through second reading a bill seeking to repeal the Nigerian Export Processing Zones Authority Act 1992 to give way for the establishment of the Nigerian Free Trade Zone Commission.
Sponsors of the bill argued that the bill when eventually passed into law will have the powers to organized management and administrative structures to regulate the activities of all Free Trade and Export Processing Zones in the country.
Honourable Etim Bassey, one of the sponsors who led the debate on the general principles of the bill, said the proposed law will enhance efficiency, ensure national security as well as promote accelerated transformation in the operations of the Free Trade Zones in Nigeria.
Etim argued that unlike the Free Trade Zones in countries such as Malaysia, Singapore, Moldova, Dubai and the United States of America, the Free Trade Zones in Nigeria have a weal legal framework and have therefore failed to deliver on their mandate. According to him, the Nigeria Export Processing Zones Act was enacted without a clear purpose and as such its provisions have promoted waste rather than accelerate trade and commerce.
The new bill, he said, has therefore been designed to bring the laws guiding the Free Trade Zones in conformity with the 1999 Constitution, remove all bottlenecks in their operations and provide enabling tools for legislative oversight on the operations of these special trade zones.
He observed that over the years, Free Trade Zones in Nigeria have deviated from the objectives of attracting domestic and foreign investments; creating opportunities for technology transfer and creating employment to becoming safe haven for corporate tax evaders, money laundering havens and enclaves for gun runners.
“We have discovered that the total exemption of enterprises operating in these zones from all forms of taxes, levies and rates as provided under the 1992 Act is too generous and not in the best interest of our country. Also the NEPZA Act completely exempts enterprises operating within the zone from foreign exchange regulations. It is known that banks operating in the zones are mere branches of banks operating within the Custom territories.
This therefore takes these banks away from the control of the Central Bank of Nigeria and the banks are therefore prone to trade-based money laundering, terrorist financing and Hawala, which is a type of money laundering that takes place within branches of the same bank,” Etim said.
Members of the Federal House of Representatives yesterday passed through second reading a bill seeking to repeal the Nigerian Export Processing Zones Authority Act 1992 to give way for the establishment of the Nigerian Free Trade Zone Commission.
Sponsors of the bill argued that the bill when eventually passed into law will have the powers to organized management and administrative structures to regulate the activities of all Free Trade and Export Processing Zones in the country.
Honourable Etim Bassey, one of the sponsors who led the debate on the general principles of the bill, said the proposed law will enhance efficiency, ensure national security as well as promote accelerated transformation in the operations of the Free Trade Zones in Nigeria.
Etim argued that unlike the Free Trade Zones in countries such as Malaysia, Singapore, Moldova, Dubai and the United States of America, the Free Trade Zones in Nigeria have a weal legal framework and have therefore failed to deliver on their mandate. According to him, the Nigeria Export Processing Zones Act was enacted without a clear purpose and as such its provisions have promoted waste rather than accelerate trade and commerce.
The new bill, he said, has therefore been designed to bring the laws guiding the Free Trade Zones in conformity with the 1999 Constitution, remove all bottlenecks in their operations and provide enabling tools for legislative oversight on the operations of these special trade zones.
He observed that over the years, Free Trade Zones in Nigeria have deviated from the objectives of attracting domestic and foreign investments; creating opportunities for technology transfer and creating employment to becoming safe haven for corporate tax evaders, money laundering havens and enclaves for gun runners.
“We have discovered that the total exemption of enterprises operating in these zones from all forms of taxes, levies and rates as provided under the 1992 Act is too generous and not in the best interest of our country. Also the NEPZA Act completely exempts enterprises operating within the zone from foreign exchange regulations. It is known that banks operating in the zones are mere branches of banks operating within the Custom territories.
This therefore takes these banks away from the control of the Central Bank of Nigeria and the banks are therefore prone to trade-based money laundering, terrorist financing and Hawala, which is a type of money laundering that takes place within branches of the same bank,” Etim said.
