Authorised Economic Operator (AEO) Programme in Nigeria
Prepare for Change
The World Customs Organization (WCO) has, over the years, acknowledged that the physical presence of Customs administrators at the gateway to a country means that compliance checks would be conducted before a decision is made to release a consignment of goods into the country.
The physical presence of Customs administrators not only acts as a deterrent to would-be fraudsters but also ensures that only permissible goods are allowed into a country.
This notwithstanding, the WCO has also noted that where Customs administrators carry out excessive and time-consuming checks at the point of clearance, the process becomes counterproductive. Consequently, many Customs administrators are currently choosing to concentrate their controls on post import and export entry checks.
Against this background, the Nigeria Customs Service has recently announced that it would implement the Authorised Economic Operator (AEO) programme and strengthen its Post Clearance Audit administration in Nigeria.
This follows the enactment of the Nigeria Customs Service Act, 2023 and several stakeholder engagements including engagements with the WCO.
The AEO programme is a scheme used by Customs administrations to encourage Economic Operators (EOs) to achieve a high level of compliance with the extant Customs rules as well as increase the adoption of safety and security standards in exchange for benefits that tend to improve the supply chain efficiency of EOs i.e., cheaper, quicker, and smoother clearance of goods.
It is a trade facilitation concept driven globally by the World Trade Organization (WTO) through its Trade Facilitation Agreement (TFA) and the WCO through the Revised KYOTO Convention and the Framework of Standards to Secure and Facilitate Trade (SAFE Framework).
In this publication, we will explain what the AEO programme is about, how it is different from existing trusted trader programmes implemented by the NCS, and how Nigerian EOs should approach this recent development. We will also unpack the likely changes that could occur as a consequence of NCS’ shift to a more post-clearance and risk-based approach towards trade compliance and facilitation.
