Building respect for IP: Nigeria Customs Service on the frontline

September 2018

By Nnenna Ugo Awa, Assistant Superintendent, Nigeria Customs Service, Abuja, Nigeria

With some 182 million residents, Nigeria is the world’s seventh most populous country. It is also Africa’s largest oil producer, pumping on average 1,943 million barrels per day. With a mixed economy and burgeoning financial, services, communications, technology, and entertainment sectors, Nigeria’s huge economic potential and ability to attract foreign direct investment (FDI) are widely recognized.

Nigeria’s huge economic potential and ability to attract foreign direct investment (FDI) is widely recognized. However, translating that economic potential into reality presents many challenges, including the need to clamp donw on levels of counterfeiting and piracy (Photo: Courtesy of Nigeria Customs Service).

However, translating this economic potential into reality presents many challenges. Not least of these is the need to improve the enforcement of intellectual property (IP) rights to clamp down on levels of counterfeiting and piracy. In 2002, the World Health Organization (WHO) reported that 70 percent of drugs in Nigeria were fake or substandard. But the problem of counterfeiting goes well beyond pharmaceuticals. Generally speaking, all categories of imported goods are susceptible to counterfeiting, and many of them find their way into Nigeria.

The huge influx of counterfeit products into the Nigerian market is driving down the country’s ranking in global indices for FDI. For example, the 2017-2018 Global Competitiveness Report, published by the World Economic Forum, ranked Nigeria 125 out of the 137 countries evaluated. Such indicators suggest that Nigeria is not a fertile destination for FDI, which is, of course, a major driver of rapid economic growth.

This worrying trend is evident in spite of Nigeria’s accession to a number of international, regional, and bilateral agreements. At the international level, in 1995, Nigeria joined the World Trade Organization and signed up to the Agreement on Trade-Related Aspects of Intellectual Property (TRIPS), which establishes the responsibilities of member governments with respect to the protection of IP rights.

At the regional level, Nigeria has signed the Common and External Act of Economic Community of West Africa (ECOWAS). Schedule 4 (Item 3) of the ECOWAS Common and External Tariff (www.customs.gov.ng/Tariff/) prohibits the importation of “all counterfeit materials or articles, including base or counterfeit coins of any country.”

In 2002, the World Health Organization (WHO) reported that 70 percent
of pharmaceuticals in Nigeria were fake or substandard. All categories
of imported goods are susceptible to counterfeiting and many of them
find their way into Nigeria (photo: Courtesy of Nigeria Customs Service).

Also at the bilateral level, Nigeria is working with its partners to strengthen IP enforcement. For example, at an IP seminar in Accra, Ghana, in 2009, which was co-organized by ECOWAS and the United States Department of Commerce, ECOWAS members agreed to “establish within their respective customs agencies, “a unit that shall be responsible for IP matters. The unit so established shall represent the agency and member state in regional Customs Union IP under the auspices of ECOWAS.” This culminated in the establishment, in January 2014, of an IP Rights Unit in the Nigeria Customs Service (NCS), the lead IP enforcement agency in Nigeria.

While NCS’s statutory presence at the country’s borders makes it the first link in the chain of IP enforcement, its ability to deliver on its IP mission is hamstrung by a number of factors.  These include:

a) Insufficient political will

Despite the existence of an enabling framework of IP laws, insufficient political will makes it difficult to enforce IP rights in Nigeria. In a country with multiple challenges, policymakers can easily lose sight of the importance of IP enforcement to the nation’s economic performance. For example, in July 2016, the Presidential Enabling Business Environment Council (PEBEC) was set up by the President of Nigeria to remove bureaucratic constraints, with a view to making Nigeria an easier place to start and grow a business. Yet, the PEBEC has put IP enforcement on the back-burner in a move that suggests that it does not recognize that the protection of IP rights is one of the biggest challenges facing businesses in Nigeria today.

b) Lack of ex-officio powers

The legal framework governing the work of the NCS does not provide customs officers with ex-officio authority for IP enforcement. The NCS’s recently established IP Enforcement Unit relies heavily on partnerships with right holders to apprehend illicit imports of counterfeit products. While it has scored some recent successes, these are limited in their scope and could be significantly boosted by empowering customs officers to confiscate suspect goods in the face of compelling evidence of infringement.

c) Unwillingness of right holders to partner with NCS on IP enforcement

NCS has fostered a number of partnerships with right holders under the WCO Customs-Business Partnership initiative, and has made positive moves to strengthen IP enforcement. However, many right holders operating in Nigeria are reluctant to partner with NCS in enforcing their IP rights regardless of the advantages of doing so.

In partnership with various regulatory border agencies with a mandate
to enforce IP, the Nigeria Customs Service has been able to seize
IP-infringing goods worth several million Naira (photo: Courtesy of
Nigeria Customs Service).

A 2017 study (available from the author) on the relationship between the NCS and right holders highlights a number of factors that weaken right holders’ interest in engaging with the Service. These include low-levels of awareness about the role NCS plays in IP enforcement; opaque IP-related customs procedures; the cost of IP enforcement; the slow pace of NCS processes; and corruption.

To address these concerns, the study highlights the need to improve information-sharing between customs and other stakeholders; to update the IP legal framework governing NCS’s activities; and to tackle ethical issues, such as corruption. Such action, the study suggests, would greatly improve right holder engagement with NCS.

The journey so far

NCS enjoys a robust relationship with various regulatory border agencies with a mandate to enforce IP. These include the National Agency for Foods and Drugs Administration and Control (NAFDAC), the Standards Organisation of Nigeria (SON), and the Nigeria Copyright Commission (NCC). These partnerships have made it possible to seize IP-infringing goods worth several million Naira. In 2017 alone, over 3 million counterfeit medicines were intercepted. NCS has also recently signed an agreement with the Nigeria Copyright Commission to better coordinate border management of copyright-infringing imports.

In some instances, close collaboration with right holders has made it possible to significantly reduce the illicit trade in counterfeit goods. NCS’s collaboration with British-American Tobacco (BAT), for example, which dates from 2001, has helped to significantly reduce the smuggling of cigarettes into the country and, indeed, to boost the company’s commercial performance. Such outcomes can flow from robust customs-right holder partnerships.

In March 2018,  the Anti-Counterfeiting Collaboration of Nigeria (ACC) whose members include Gongoni (a producer of high-quality aerosols and other consumer products), Japan Tobacco International (JTI), Diageo, Nestlé, Tara Cosmetics, Canon Inc., Glaxosmithkline, Pfizer, Gucci, and Nike, joined ranks with NCS. In an attempt to tackle the scale of counterfeiting and its all-pervasive nature, the ACC and NCS undertook a two-week capacity-building program to train 124 frontline officers from across the country on IP enforcement.

This highly successful initiative helped build IP awareness among border officials and boost the confidence of right holders in NCS operations. It also has given rise to a number of additional initiatives that promise to further strengthen relations with right holders.

These promising first steps will enable us to make even greater strides towards enabling more effective IP enforcement in the coming months and years.

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