LADOL Refutes Claims Of Illegal Charges On Investors

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The management of Lagos Deep Offshore Logistics (LADOL) has refuted claims of imposing illegal charges for its operations, noting that all charges were statutory and backed up by law.

Managing Director, LADOL, Amy Jadesinmi, made this known to journalists in Lagos.

Some investors had accused LADOL of illegally imposing a levy of one percent Free on Board (FOB) charges for the Egina Floating Production Storage Offloading (FPSO) unit for SHI-MCI FZE totalling about $33 million.

In its defence, Jadesinmi stated: “All charges are mandated by the federal government policy which is within a transparent frame work. No company operating in the LADOL free zone have been charged with charges not mandated by the government.

“It is wrong to calculate the value of the one percent management fee in the contract when the project had not yet left the free zone. This is not a unilateral action by us, and to say otherwise is completely false and highly mischievous since we have been transparent at all times.

“The enterprises operating within the LADOL free zone and the related parties are aware of the charges and the rules and regulations in detail. The charges are known and required to maintain the zones and the free zone scheme.

“There is nothing that was not known at the start of the project. Within the approved tariff, you have what is called the one percent management fee as the statutory charge. The one per cent management fee is one per cent of the cost of the product when it leaves the free zone. Obviously you can’t calculate that till the end of the project so what is known is that there will be that calculation and that management fee is clearly stated on the tariff schedule and it’s not unique to this project and is not unique to Samsung.”

Meanwhile, operators had stated that the crisis will in a long run hinder the efforts put in place by the Federal Government through the Vice President, Yemi Osinbajo, after the Executive Orders to improve Nigeria’s ranking on the Global Ease of Doing Business signed in May 2017.

Citing the case of Samsung Heavy Industries (SHI) of Korea, that has 70 percent stake in the SHI-MCI FZE, a joint venture company, which is currently integrating the $3.3 billion Egina FPSO, operator said, “some privately-owned free zones are known for blind sighting authorities to raise their own revenue rather than raising public fund.”

However, another official of an IOC alleged that the free zone management company has usurped the powers of federal government agencies, adding that “we also doubt if the company wants to improve Nigeria’s economy or to increase its own revenue”.

“The free zone management company is refusing to grant SHI-MCI FZE’s, SHI Nigerian local joint venture company, operating license renewal without a clear legal basis. Further to this refusal, SHI, which invested over $300 million, has faced the risk of dooming their subsidiaries just after over four years of operation in Nigeria,” he said. He called on the federal government and its various agencies to intervene in the operations of the private free zones in the country to save foreign investments.

“At a time when foreign investments are highly desired, these investor-unfriendly policies have the potential to scare investors,” he added.

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