Modern day commercial activities cannot be complete without solving the timeless problem of LOGISTICS which involves the gap-bridging activity of getting goods from the manufacturer or vendor to the end-user/customer.
The need for logistics services increased to an even more problematic level during the Covid-19 pandemic in 2020 that saw international and national commercial activities heavily dependent on physical or in-person contact and interactions grind to a near-halt, especially in places like Lagos in Nigeria with a humongous population of at least 20million people by conservative estimates who have daily personal, utility and business needs from food and medicines to retail and wholesale goods purchases.
The pandemic also gave rise to a previously overlooked subsector of the Logistics Industry – Courier services heavily dependent on intra-city, inter-city and inter-state speedy deliveries in heavily populated areas with typical traffic problems, creating a demand gap left by the top-level Industry players like DHL which began to be filled by SMEs using smaller delivery platforms like pick-up trucks, tricycles (otherwise called “Keke” in Nigeria) and Motorbikes, some of them operating via Digital business models.
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This led to the agency in charge of regulating this industry, The Nigerian Postal Service(NIPOST), through the Federal Ministry of Communications and Digital Economy, released a set of revised Guidelines known as the Courier & Logistics Services Operations Regulations 2020 to govern the licensing and operation of Courier and Logistics companies in Nigeria.
As a result, this article aims to let you know:-
– The legal definitions of Courier and Logistics services in Nigeria under the Regulations;
– The available categories of licenses under the Regulations and their licensing and renewal requirements;
– Any further Regulatory Compliance requirements existing under laws other than the regulations and the NIPOST Act.
What are “Courier” and “Logistics” services under the Regulations?
The Regulations define Courier services as “Door-to-Door” time- sensitive logistics services which include the delivery of documents, parcels, merchandise and/or cargo with a total weight of not less than 0.5kg and not more than 50kg.
The Regulations go further to define Logistics as “delivery services which include haulage, conveyance & dispatch/delivery of items or goods weighing not less than 50kg.
What are the available Licence categories and their licensing application and renewal requirements?
Under the Regulations, the following license categories are currently available in Nigeria :-
- 1. An International Courier license :- This is for logistics companies that wish to engage in rendering logistics services across International borders.
- 2. A National Courier license :- This licence is for companies that wish to carry out logistics services Nationwide.
- 3. A Regional Courier license :- This licence is for companies that wish to engage in logistics services within a Geo-Political zone.
- 4. State/Special SME license :- This licence category is for companies seeking to render logistics services within a State, city or having not more than 5 motorcycles.
The licensing requirements for the above categories include :-
– An application from your lawyer to the Postmaster-General of NIPOST;
– The Certificate of Incorporation and Memorandum/Articles of Association of the applicant company;
– The Business plan, Company profile and Operations manual of the company (the operations manual in particular must involve consulting a lawyer to advise you fully on the provisions of the Regulations);
– A Goods-in-Transit policy of the applicant company;
– A Tax clearance certificate;
– Evidence/Proof of Share Capital being allotted and subscribed to;
– A filled application form P306 along with a non-refundable licence application fee of 20,000Naira payable to the Treasury Single Account (TSA);
– Evidence of storage and warehousing facilities on inspection;
– Office location details;
– Evidence of Compliance regarding Expatriate quota Regulations where Non-Nigerians are to be hired by the applicant company;
– Evidence of payment of licensing fees for a particular category.
The applicable license and renewal fees for each category are as follows:-
– International Courier license
License fee – 20 Million Naira.
Licence renewal fee- 1,875,000.00 Naira.
– National Courier license
License fee – 3 Million Naira
Licence renewal fee-625,000.00 Naira
– Regional Courier license
Licence fee – 2 Million Naira
Licence renewal fee- 437,000.00 Naira
– State/ Special SME license
Licence fee – 250,000.00 Naira
Licence renewal fee-100,000.00 Naira
How long do License applications take to be determined?
License applications take at least 30 days from the date of receiving the application to be determined.
For how long are licences under the Regulations valid until renewal?
Licences granted under the Regulations are valid for 1(One) year and are to be renewed not later than 3months to the expiration date of a license.
Are there penalties for failing to renew a license?
Yes there are. A licence renewal default attracts a penalty of 50% of the renewal fee in addition to paying the main renewal fee as well as possible license revocation.
Can a License application be rejected and if yes, on what grounds?
Yes, a License application can be rejected on the basis of unsuitability or on grounds of public policy/the public interest.
What are the complete ethical compliance requirements of the Regulations?
You will have to consult your lawyer on this as the requirements are quite numerous and need to be explained in-depth.
What is the name of the actual agency in charge of regulating Courier services in Nigeria?
The agencies in charge of regulating Courier services in Nigeria are the Nigerian Postal Service and The Federal Ministry of Communications & Digital Economy through the Courier Regulatory Department(CRD).
Are there further laws and/or regulations that are to be complied with by existing or intending Courier companies at the Federal or State level?
Yes there are. At the state level especially in Lagos State, there’s a Transport Sector Reform Law (TSRL 2018) that also has to be complied with.
I would like to brand all my courier vehicles with my company logo and other trademarks as a form of advertisement for my business. Can i do this freely?
No, you cannot. In states like Lagos branded cars and vehicles along with billboards and public/outdoor advertisement or signage platforms are governed by the Lagos State Structure for Signage & Advertisement Agency (LASAA) which issues permits in response to applications for the purpose of engaging in the activities mentioned above.
Branding in this case can either be Semi-branding (with just the name, address and phone numbers of the company being displayed) or Full branding (involving the additional display of images representing the company, product, service or any other Trademark.
It should be noted that for Courier companies an application for a LASAA permit should also be made specifically for a Mobile Advert permit allowing for the use of branding on Courier vehicles for the purpose of advertisement.
What are the requirements for a LASAA/Mobile Advert Permit?
The requirements for this type of permit (renewable annually) include the following :-
– A completed Mobile Advert Form;
– A photograph of the vehicle and its registration details;
– A copy of the license of the vehicle;
– Permit fee payment proof.
The fees for securing a Mobile advertisement permit are :-
–Truck/Trailers
Semi-branding – 9,900.00 Naira
Full branding – 49,900.00 Naira
– Coaster Buses
Semi-branding – 9,900.00 Naira
Full branding – 49,900.00 Naira
– Jeeps
Semi-branding – 7,900.00 Naira
Full branding – 39,900.00 Naira
– Cars
Semi-branding – 3,900.00 Naira
Full branding – 19,900.00 Naira
– Motorcycles (Okada)
Semi-branding- 1,900.00 Naira
Full branding – 19,000.00 Naira
– Tricycles (Keke)
Semi-branding – 1,900.00 Naira
Full branding – 19,000.00 Naira
– Bicycles
Semi-branding – 1,900.00 Naira
Full branding – 19,000.00 Naira
–Pushcarts (Can apply to Wheelbarrows)
Semi-branding- 1,900.00 Naira
Full branding – 19,000.00 Naira
Conclusion :- It can be seen from the above write-up that the Regulatory Framework governing Courier/Logistics services in Nigeria is quite detailed and open to constant evolution, albeit with somewhat strict penalties for default put in place . Going into this lucrative field with the right planning requires that you have the right professional guidance to enable you make better-informed decisions and ensure a better Compliance record from the Pre-licensing stage to the post-licensing, operation and licence renewal stages going forward.