The Proposed NAFDAC Regulation Bill on Cocoa Export – What You Need to Know

Sunpress Weekly Bulletin - Issue 4

The Nigerian National Agency for Food and Drug Administration and Control (NAFDAC) recently submitted a proposed bill to the federal government suggesting significant changes to regulations around export activities in Nigeria.

NAFDAC’s intention behind the proposed regulations is to introduce stringent measures to bolster efforts in guaranteeing the quality and safety of export goods.?

However, several of the affected stakeholders, particularly, cocoa and cocoa product exporters are opposed to the bill, voicing their concerns on the potential implications of the bill on their operations if passed into law.

Understanding the Proposed Export Regulation Bill.

NAFDAC’s proposed export bill seeks to impose strict regulatory measures on all export activities involving several product categories within its operational purview. The regulations will apply to commodities classified as;

Regulated products, food, drugs, cosmetics, medical devices, packaged water, chemicals, and related matter.

Stakeholders involved in the exportation of these products will have to adhere to the following provisions of the bill.

• Authorization and Mandatory Certification: The proposed bill would require exporters to obtain NAFDAC certification for all products intended for export.?
• Increased Inspection and Monitoring: The bill will also impose additional pre-shipment inspections and monitoring activities overseen by NAFDAC's designated personnel or agencies on export goods.
• Traceability Requirements: The bill would also require the exporters to implement robust traceability and documentation systems to track the origin and movements of their products as well as the information of the producers, suppliers, and other key actors involved in the supply chain.
• Export Fees and Levies: The regulatory activities proposed in the bill will attract commiserate fees and levies. These charges will be incurred by the exporters who must remit the dues on their export consignments.

How Will The Bill Affect Cocoa Exporters?

Cocoa, being one of the commodities covered under the regulated products category will be significantly affected by the regulation if passed into law. Cocoa exporters are likely to experience three main drawbacks from the regulations;

• Increased operational costs from the additional taxes, tariffs, and the financial implications of installing new measures and processes to comply with the regulatory requirements.
• Export delays arising from additional inspections and monitoring which may take significant time to complete
• Compliance challenges, stemming from the need for exporters to put new infrastructure and policy in place to cater for the provisions of the regulations. Exporters already have to deal with the strict requirements of several other regulatory bodies, the new demands from NAFDAC will only increase their burdens.

How Cocoa Exporters Are Responding

Considering the implications of the proposed bill, it is easy to understand why members of the affected parties would be opposed to the proposition. Expectedly, several actors in the Nigerian cocoa industry have vocalized their concerns with the proposed bill.

The most popular sentiment revolves around how some of the propositions in the bill would result in a duplication of the responsibilities and functions of other government agencies. For example, the pre-shipment inspection cited in the bill is already within the purview of NEROLI technologies.

Similarly, the export application administration and certification are already part of the Nigerian Export Promotion Council’s (NEPC) responsibilities.?

As such, NAFDAC incorporating such measures in their processes would likely be a redundant development that would cost the stakeholders extra money and delay their operations.

In addition, a section in the bill seeks to authorize NAFDAC to seal any premises without lawful order. Without appropriate checking measures in place, this policy could be susceptible to abuse and use as a manipulative tool.?

Final Takeaway

The intentions behind the proposed bill might be great, but the implications aren’t.?

While the proposed NAFDAC export regulation bill aims to enhance the quality and safety of Nigerian agricultural exports, several of the proposed conditions in the bill present significant challenges that could negatively impact the operations of cocoa exporters.?

A more detailed version of this post is available on our blog, you can read it here.

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