Customs Denies Manipulating FX Charges, Cites CBN Authority: A Breakdown of Nigeria’s Trade Valuation System

In a formal statement, the Nigeria Customs Service (NCS) has categorically denied allegations of manipulating foreign exchange (FX) rates used for customs valuation. The Service asserts that the Central Bank of Nigeria (CBN) is the sole statutory authority for FX rate determination and that its automated B’Odogwu platform integrates these rates electronically without human interference. This article provides a detailed, SEO-optimized analysis of the NCS position, the technical and regulatory framework, and practical guidance for traders.

Introduction: Understanding the Controversy

The accurate valuation of imported goods is a cornerstone of customs revenue collection and trade facilitation. In Nigeria, this process hinges on the official foreign exchange (FX) rate applied by the Nigeria Customs Service (NCS) to convert invoice values from foreign currencies to Nigerian Naira. Recent public discourse and media reports have questioned the transparency and consistency of these applied rates, suggesting potential manipulation by customs officials. This controversy directly impacts importers, exporters, and the broader business environment, influencing costs, predictability, and perceptions of governance.

On February 16, 2026, the NCS, through its spokesperson, issued a definitive rebuttal. The Service’s statement is not merely a denial; it is a technical exposition on the separation of duties between Nigeria’s apex financial institution and its customs authority, and a defense of the automated systems designed to ensure integrity. This article will dissect the NCS statement, contextualize it within Nigeria’s legal and financial framework, analyze the operational safeguards, and provide actionable insights for stakeholders in international trade.

Key Points: The NCS Position Summarized

• No Authority to Set or Change Rates: The NCS explicitly states it does not determine, generate, or alter FX charges. This function rests solely with the Central Bank of Nigeria (CBN).
• Automated, Non-Discretionary Application: The B’Odogwu customs platform receives FX rates via electronic transmission from the CBN and applies them uniformly across all ports and formations automatically, eliminating human discretion in rate selection.
• Clarification on Reported Rates: The NCS refuted a specific reported rate of ₦1,451.63/$ on February 6, 2026, stating it originated from a legacy portal (company.gov.ng) not used for live customs processing. The authoritative rate on that date was ₦1,365.56/$.
• Authoritative Source Designation: The only official portal for real-time customs declarations and valuation is the B’Odogwu platform: https://bodogwu.customs.gov.ng.
• System Integrity Safeguards: The system retains the last valid CBN rate during data transmission gaps, ensuring continuity and preventing arbitrary changes.
• Future Enhancements: The NCS is collaborating with the CBN to implement a more robust API-based integration for seamless, real-time rate transmission.
• Commitment to Transparency: The Service reaffirms its dedication to transparency, predictability, and the facilitation of legitimate trade in line with national policy.

Background: The Legal and Institutional Framework

To understand the NCS statement, one must first grasp the distinct but complementary roles of the CBN and the NCS under Nigerian law.

The Central Bank of Nigeria (CBN): The Sole FX Arbiter

Enshrined in the Central Bank of Nigeria Act 2007, the CBN is the national authority responsible for monetary policy, including the management of Nigeria’s foreign exchange reserves and the determination of official exchange rates. The CBN publishes various rates (e.g., Official Rate, Nafex, Investor & Exporters Window rates) through its official channels. Its mandate is to ensure price stability and maintain the external value of the Naira. No other government agency, including the NCS, has the legal backing to set or modify these rates. The NCS’s use of a CBN rate is a matter of regulatory compliance, not discretion.

The Nigeria Customs Service (NCS): The Valuation Implementer

The NCS derives its powers from the Customs and Excise Management Act (CEMA) Cap C45 LFN 2004. Its primary duty is to assess and collect customs duties, enforce trade regulations, and facilitate trade. Valuation for duty purposes follows internationally recognized principles, primarily the World Trade Organization (WTO) Agreement on Customs Valuation, which Nigeria has adopted. This agreement prioritizes the transaction value of goods (the price actually paid or payable), converted to Naira using an appropriate FX rate. The NCS’s role is to apply the correct rate to a correctly declared transaction value—it does not set the rate.

The B’Odogwu Platform: Nigeria’s Trade Digitalization Backbone

The B’Odogwu platform (formerly the Nigeria International Trade and Procedures Portal) is the NCS’s flagship electronic customs system. It was designed to automate processes, reduce human interface, and enhance transparency. A critical component of this automation is the direct integration of the CBN’s official FX rate. The system’s architecture is intended to fetch the rate electronically and apply it as a default, non-negotiable parameter in the calculation of duty liabilities. This is a key control against corruption and arbitrary valuation.

Analysis: Deconstructing the NCS Statement

The NCS statement is a strategic communication aimed at restoring trust. Its technical details form the core of the defense.

The Allegation: Unauthorized Rate Manipulation

The implied accusation is that customs officers, either manually or through system backdoors, select or input different FX rates than the official CBN rate to inflate duty assessments or create opportunities for rent-seeking. This would constitute a breach of CEMA and undermine the entire digitization effort.

The NCS Rebuttal: A Technical Defense

1. Source Authority: By repeatedly citing the CBN as the “sole statutory authority,” the NCS legally distances itself from rate determination. It frames any suggestion of manipulation as a misunderstanding of Nigeria’s financial architecture.
2. Process Automation: The claim of electronic transmission and routine integration “without human interference” is the most critical technical point. If true, it means an officer on the ground cannot override or select a different rate. The system pulls and applies the rate autonomously.
3. Uniform Application: “Uniformly applied across all customs formations” addresses concerns about port-to-port discrepancies. It asserts that a single, national rate is in effect at any given time, ensuring predictability.
4. Debunking the N1,451.63 Figure: This is a specific factual correction. The NCS identifies the source as company.gov.ng, a legacy portal. This is a crucial distinction. Legacy portals may have cached or outdated data and are not connected to live clearance systems. Relying on them for “current valuation figures” is erroneous. The NCS provides the “authoritative” rate (₦1,365.56) and the authoritative source (B’Odogwu), effectively discrediting the reported figure as irrelevant to actual transactions.
5. Safeguard Protocol: The explanation about retaining the “last valid Central Bank rate” during transmission updates is a standard IT control (a “fallback” or “caching” mechanism). It ensures that if the live feed from CBN has a temporary glitch, the system doesn’t default to zero, an old rate, or allow manual entry. It defaults to the last known good rate, preserving valuation integrity until the new official rate is successfully uploaded.

Systemic Implications and Trust

The NCS’s argument rests on the infallibility of its automated system. The public’s skepticism often stems from a historical context of manual, opaque processes. The statement is therefore an attempt to rebuild trust by emphasizing that the old ways are gone. The mention of future API-based integration with the CBN is a forward-looking promise to make the system even more resilient and real-time, further closing any perceived gaps.

Practical Advice for Importers, Exporters, and Customs Brokers

For businesses engaged in international trade, navigating the FX rate for customs valuation is a critical operational and financial task. Based on the NCS statement and standard best practices, here is actionable advice.

1. Know and Use the Official Source

Always verify the applied FX rate through the official B’Odogwu customs portal (https://bodogwu.customs.gov.ng) during the declaration process. Do not rely on third-party websites, legacy portals, market rumors, or unofficial “black market” rates for customs purposes. The rate displayed in your final assessment notice from B’Odogwu is the legally applicable rate.

2. Understand the Rate Applicability Date

The FX rate applied is typically the one in force on the date of arrival of the vessel/aircraft or the date of commencement of the importation process, as defined by CEMA. It is not necessarily the rate on the invoice date or the payment date. Confirm the exact “rate date” used in your transaction with your customs broker.

3. Document Everything

Maintain meticulous records: the commercial invoice, bill of lading/air waybill, your broker’s assessment screenshot from B’Odogwu showing the applied rate, and the final duty payment receipt. If there is ever a dispute, your documented proof of the rate applied by the official system is your primary evidence.

4. Report Genuine Discrepancies Through Official Channels

If, during the declaration process on B’Odogwu, you encounter what appears to be a technical error in the rate displayed (e.g., an old rate after a known CBN change), do not proceed with the declaration. Immediately:

• Take a screenshot.
• Report the issue formally to your licensed customs broker’s supervising office.
• The broker should escalate it through the NCS’s technical support or grievance redress channels.
• Do not engage in off-system negotiations to “correct” the rate, as this could expose you to allegations of complicity in fraud.

5. Stay Informed on CBN Policy

While the NCS applies the rate automatically, significant changes in Nigeria’s FX policy (e.g., unification of rates, creation of new windows) emanate from the CBN. Monitor CBN circulars and official rates published on www.cbn.gov.ng to understand the broader context of the rate being applied.

FAQ: Frequently Asked Questions on Customs FX Valuation

Q1: Can I request the customs officer to use a more favorable FX rate (e.g., the parallel market rate) for my valuation?

A: No. The customs valuation is bound by law to use the official FX rate as determined by the CBN and automatically applied by the B’Odogwu system. Any agreement to use a different rate is illegal and constitutes customs fraud, punishable under CEMA. Both the importer and the complicit officer risk severe penalties, including seizure of goods, fines, and prosecution.

Q2: The rate on my invoice is different from the rate applied by customs. Why?

A: This is common and expected. The rate on your invoice is the rate you transacted at (e.g., a bank rate, parallel rate, or a contracted rate). For customs duty calculation, the law requires the use of the official CBN rate in force on the date of importation, as applied by the NCS system. The difference is a normal cost of importation and is not indicative of manipulation.

Q3: What should I do if my broker tells me the B’Odogwu system is “down” and we need to use a “manual rate”?

A: This is a major red flag. According to the NCS, the system should have a fallback mechanism with the last valid CBN rate. A true system outage should be reported and handled by NCS ICT officials, not by brokers. You should refuse to proceed with a manually inputted rate and insist on written confirmation from the Customs Area Command about the technical issue and the official procedure being followed. Document all communications.

Q4: Does the NCS profit from using a higher FX rate?

A: No. The FX rate is a conversion factor. A higher Naira-per-Dollar rate increases the Naira value of the invoice, which in turn increases the calculated duty (since duty is a percentage of the value). The additional revenue goes to the federal government’s consolidated revenue fund, not to the NCS as an institution or its officers. The incentive for manipulation would be to solicit bribes from importers seeking a *lower* applied rate, not to apply a higher one arbitrarily.

Q5: How often does the CBN update the official FX rate that customs uses?

A: There is no fixed public schedule. The CBN updates its official rates based on its monetary policy decisions and market interventions. The NCS’s system is designed to receive and integrate these updates electronically as they are transmitted by the CBN. Traders should assume the rate can change at any time and verify the rate in effect on their specific date of importation.

Conclusion: Transparency Through Technology and Clarity of Roles

The Nigeria Customs Service’s denial of FX rate manipulation is a clear assertion of its operational boundaries and technological capabilities. Its position is legally sound: the CBN is the undisputed authority on exchange rates. The NCS’s value proposition is in the automated, uniform application of that authority’s directives via the B’Odogwu platform. The controversy highlights a persistent trust deficit that can only be bridged by sustained system reliability, transparent communication, and the consistent demonstration of non-discretionary processes.

For the trading community, the practical takeaway is unambiguous: the B’Odogwu portal is the single source of truth. Vigilance, proper documentation, and the use of licensed, ethical customs brokers remain the best defenses against valuation errors or fraud. The ongoing collaboration between the