FG Relaxes 4% FOB for Specific Industries

…Names Beneficiaries of Cargo Re-release Regime

BY EGUONO ODJEGBA

In a landmark move aimed at boosting Nigeria’s industrial competitiveness, the Federal Government has approved strategic exemptions from the 4% Free on Board (FOB) charge for select sectors, following a high-level consultation between the Nigeria Customs Service (NCS) and the Manufacturers Association of Nigeria (MAN).

At a joint press briefing which followed a closed door meeting between both organizations held on Friday, September 26, 2025 at MAN’s Secretariat Lagos, said to have been convened in response to the Ministry of Finance’s directive suspending the 4% FOB levy, NCS and MAN said the meeting provided a platform for both institutions to align trade facilitation efforts with the operational realities of Nigeria’s manufacturing sector.

The Nigeria Customs Service announced that manufacturers importing raw materials, machinery, and spare parts under Chapters 98 and 99 of the Customs Tariff will now enjoy exemptions from the 4% FOB charge.

While these chapters cover concessionary imports critical to industrial production, the following categories have been named as beneficiaries of the cargo re-release regime:

1. Manufacturers not currently listed under Chapters 98 and 99, pending expedited onboarding.
2. Government projects with valid Import Duty Exemption Certificates.
3. Goods imported for humanitarian and life-saving purposes.
4. Participants in the Presidential Initiative for unlocking the healthcare value chain, and :
5. Commercial airlines importing spare parts.

It was also resolved that manufacturers who have already paid the 4% FOB but are yet to be onboarded will have their payments held as credit for future customs transactions.

The engagement also spotlighted broader trade facilitation reforms whereupon; the NCS reaffirmed its commitment to balancing revenue generation with industrial support through initiatives such as the Authorized Economic Operator (AEO) scheme, Advance Ruling, and Time Release Studies.

While MAN commended the AEO program and called for clear admission guidelines, both parties agreed to reduce bureaucratic bottlenecks, streamline regulatory processes via one-stop-shop frameworks, and deploy digital solutions to enhance clearance efficiency and reduce compliance costs.

In the spirit of the new era of collaboration, the meeting concluded with a commitment to institutionalize regular consultations between NCS, MAN, and the Federal Ministry of Finance. These will include proactive policy dialogues, real-time feedback mechanisms, and periodic reviews to ensure customs policies support Nigeria’s industrial growth, job creation, and foreign exchange conservation.

The joint statement, signed by MAN President, Otunba Francis Meshioye and Comptroller General of Customs, Bashiru Adewale Adeniyi, emphasized that constructive dialogue remains key to achieving regulatory excellence and economic transformation.

Speaking earlier in the day during the preamble, CGC Adeniyi  provided the basis for the long drawn meeting with local manufacturers, noting that the essence is to engage robustly and build consensus, in line with federal government initiatives to ensure that the organized private sector is actively involved in fiscal policy discussions and implementations.

“The recent directive to suspend the FOB policy opens the door for deeper dialogue. While the policy is legally grounded in the Nigeria Customs Service Act 2023, its implementation must be shaped by consultations like today’s”, Adeniyi said.