BUSINESS ESSENTIALS VOL. 4 No.10
Dear Esteemed Member,
In keeping with our continued tracking of developments in the economy to support informed decisions by business leaders, we captured recently released inflation figure by the National Bureau of Statistics (NBS), which showed a relative decline. This is the first decline in 15 months and a sign of a resonating economy from the recession.
We also reviewed a recent policy of the Nigeria Immigration Service (NIS) on the Business Visa for foreigners and Investors and a circular from Federal Inland Revenue Service (FIRS) for Taxpayer’s compliance and guidance.
Our regular Labour and Employment Law Review and Upcoming Training Programmes were not left out.
Have a pleasant reading.
In this Issue:
- Inflation Rate Declines by 0.94% in February 2017
- Nigeria Reviews Visa Policies for Foreigners & Investors
- Taxpayers To Validate Official Email Address With FIRS
- Labour & Employment Law: The National Industrial Court
- Upcoming Training Programmes
Announcing: Annual Retreat of NECA Technical Committees
Theme: Repositioning Enterprise for Growth
Keynote Speaker: Mr. Taiwo Adeniyi,
Group Managing Director, Vitafoam Nig. Plc
Date: 24-25 March 2017
For Bookings: contact Celine (08064716927,email@example.com) or Adewale (08069720364, firstname.lastname@example.org)
Inflation Rate Declines by 0.94% in February 2017
The Consumer Price Index (CPI) measures the average change over time in prices of goods and services consumed by people for day-to-day living i.e it measures the Inflation Rate.
According to the National Bureau of Statistics (NBS), Inflation moderated from 18.7% in January to 17.8% in February, marking the first decrease since October 2015 and the lowest point since August 2016. Higher inflation in February was driven by an across-the-board increase in all components of the index. Electricity, liquid and solid fuels, fuels and lubricants for transport equipment were the components that reported the highest increases. Despite February’s drop, annual average inflation soared from 16.4% in January to 17.0% in February, the highest point in almost 11 years.
Core consumer prices, which exclude farm products and energy prices, rose 1.1% in February (January: +0.7 month-on-month). Lastly, core inflation dropped from 14.5% in January to 14.0% in February.
- Forex market: Output in the Nigerian climate is a function of forex availability and market policy consistency. The CBN has sold approximately $1.4bn in spot and forwards auctions, with a significant amount in the latter. If this is sustained, we expect to see a further convergence in market rates, a reduction in import costs and a boost in inventory levels. The PMI for March and April should record expansions based on anticipations of improved dollar liquidity and inventory.
- Supply side factors: According to reports, on average Nigeria loses over 1,000MW of every 3,000MW of power generated. On a cumulative scale, this comes to about N400bn each year, which is almost equivalent to the amount of funds budgeted for the Power, Works and Housing ministry of N500bn.
This loss is not sustainable as lack of adequate power supply feeds the surge in diesel prices (diesel is used to power generators). Diesel prices averaged N270 per liter in February. The impact of a surge in the price of diesel transcends into other aspects of the production process via increased costs of distribution and logistics. Therefore, there has to be a conscious effort to taper the level of waste in the power sector.
On a lighter note, efforts by the presidency and the militants in the Niger Delta will help deter the level of militant activity on gas pipelines, thereby increasing the capacity for power generation.
- Money Supply: Money supply will continue to be a central focus for the CBN, as an increase in narrow money without a corresponding increase in output will increase inflationary pressure in the country. The good news is that the CBN’s frequent sale of dollars mops up naira liquidity. In February, the average opening position was N74.9bn short, compared to a long position of N152.9bn in January. So far in March, the average opening position in banks is N19.7bn long (March 13).MPC meeting next week (20th – 21st March, 2017): The confluence of good news in the economy increases the temptation to pursue a more accommodative stance. The good news ranges from a tapering in inflation and slow expansion in GDP to external reserves above $30bn. Ultimately, the consensus is that the MPC should adopt a wait-and-see approach with slight changes to the CRR at best.
Nigeria Reviews Visa Policies for Foreigners & Investors
As part of Nigeria’s drive to improve the ease of doing business, the Nigeria Immigration Service (NIS) has announced changes to the scope of activities that can be carried out on a business visa. The NIS has also shortened the approval period for visa on arrival, opened new production centres for residence permits and decentralised the reissuance of missing passports or those requiring biodata changes.
Before the new changes announced by the Minister of Information on 26 February 2017, business visas were limited to business meetings. Under the new visa regime, foreigners can now obtain business visas where a temporary work permit was previously required. These include visits for conferences, seminars, contract negotiation, marketing, sales, purchase, distribution of goods, trade fairs, job interviews, training of Nigerians, emergency or relief work and research. Also crew members, staff of nongovernmental organisations and musical concert performers can now apply for business visas.
Procedure for obtaining Business visas
Applicants are to apply for the visas in their country of origin or legal residence. Each High Commission may have different requirements.
Visa on Arrival (VoA)
The VoA facility is available to business visitors who may not be able to obtain visas at the Nigerian Missions/Embassies in their countries of residence either due to the absence of a Nigerian mission in those countries or exigencies of urgent business travels. It is issued for a month but can be extended to 90 days.
Procedure for obtaining Visa on Arrival
Step 1: A representative in Nigeria must apply for a VoA approval. The application must contain information such as the visitor’s name, passport number, nationality, purpose of visit, date of entry etc. The approval is issued within 48 hours and valid for 14 days after issuance.
Step 2: Applicants are to log on to https://portal.immigration.gov.ng to fill the necessary information and pay the VoA fee. At the port of entry, visitors are to present the approval letter and evidence of payment. An entry visa will be issued subsequently.
- Decentralisation of NIS: The NIS has decentralised the reissuance of passports from its headquarters to the state commands. Previously, Nigerians who needed to make changes to their passport details due to marriage or those who lost their passports had to apply at the headquarters in Abuja.
New Production Centres: The NIS has opened 28 new residence permit production centres across state commands. Previously, three state commands could share a zonal production centre often causing delays and backlogs.
The new changes are expected to make it easier for foreigners to visit Nigeria for business, tourism or other purposes. It is important to note that expatriates who are on business visa may be exposed to personal income tax if they derive income from Nigeria.
Taxpayers To Validate Official Email Address With FIRS
Federal Inland Revenue Service (FIRS) has issued a public notice requesting taxpayers to validate their official email addresses in FIRS’ records. The validation process is expected to commence with immediate effect.
FIRS requires taxpayers to complete ‘E-Filing Access Application Form’ with appropriate details. The forms are expected to be submitted to FIRS’ offices where taxpayers file their tax returns. Following a successful validation, FIRS will no longer manually issue physical receipts for tax payments.
Rather, electronic copies of tax receipts would be sent to the designated email address against a company’s name on FIRS’ portal. Considering what is being used to capture this information is the E-filing Access Application Form, it is envisaged that authorised personnel of a company will be granted access to the FIRS e-filing portal.
We therefore, advice taxpayers to comply with this new directive to make obtaining tax payment receipts seamless in future.
Labour & Employment Law: The National Industrial Court
- What the National Industrial Court is.
The National Industrial Court is a judicial institution established in 1976 vides the Trade Disputes Act (TDA) Cap 432, Law of the Federation of Nigeria (LFN) 2004. The Court became functional in 1978. Due to a number of shortcomings in the TDA which impacted adversely on the workings of the Court, the National Industrial Court Act, 2006, re-established the National Industrial Court as superior court of record with jurisdiction on labour and industrial relation matters.
The 1999 Constitution (Third Alteration) Act, 2011, established the Court as a superior court of record specifically and expressly under the Constitution. The Court has and exercises exclusive jurisdiction in civil causes and matters relating to labour, employment, trade unions, industrial relations, and matters arising from workplace, the conditions of service, including health, safety welfare of labour employee, worker and matters incidental thereto and connected therewith.
Section 254C (5) of the 1999 Constitution Third Alteration Act, 2011 confers on the National Industrial Court jurisdiction and powers in criminal causes and matters arising from any cause or matter on which jurisdiction has been conferred on it.
The Court is dedicated and specialized with exclusive jurisdiction in civil causes and matters relating to,
- Labour laws
- Industrial actions;
- Interpretation of laws;
- National minimum wage;
- Unfair labour practice or international best practice in labour matters;
- Discrimination or sexual harassment at workplace;
- Application or interpretation of international labour standards;
- Child labour;
- Collective agreements;
- Payment or non-payment of salaries, wages, etc;
- Appeals from any award or judgement of the Court
- Types of cases before the National Industrial Court.
The Court is empowered to hear and resolve all-
- Disputes relating to or connected with-
- Disputes relating to or connected with disputes arising from payment or non-payment of salaries, wages, pensions, gratuities, allowances, and benefits and any other entitlement of any employee, worker, political or public office holder, a judicial officer, or any civil or public servant in any part of the Federation and matters incidental thereto;
- Disputes relating to or connected with any personnel matter arising from any free trade zone in the Federation or any part thereof;
- collective agreement;
- an award of made by an arbitration tribunal in respect of a trade dispute or trade union dispute;
- award or judgment of the Court
- Trade union dispute or employment dispute as may be recorded in the memorandum of settlement
- Trade union constitution, the constitution of an association of employers or any association relating to employment, labour, industrial relations or work place
- Disputes relating to or connected with employers and
- employees relationship;
- Disputes relating to or connected with environment,
- conditions and or terms of work;
- Disputes relating to or connected with health of workers;
- Disputes relating to or connected with workplace safety;
- Disputes relating to or connected with welfare of labour, employee and workers;
- Disputes relating to or connected with Factories Act, Trade Disputes Act, Trade Unions Act, Labour Act, Workmen’s Compensation Act or any other Act or Law relating to labour, employment, industrial relations, workplace or any other enactment replacing the Act or Laws;
- Disputes related to or connected with an order granted to restrain any person or body from taking part in any of the following;
- Industrial action;
- Conduct in contemplation or furtherance of a strike;
- Disputes related to or connected with any disputes over the interpretation and application of Human Rights as they relate to any employment, labour, industrial relations, trade unionism, employer’s association or any other matter which the Court has jurisdiction to hear and determine;
- Disputes related to or connected with any dispute arising from minimum wage for the Federation or any part of the Federation;
- Disputes relating to or connected with unfair labour practice or international best practices in labour, employment and industrial relation matters;
- Disputes relating to or connected with any dispute arising from discrimination or sexual harassment at workplace;
- Disputes and matters relating to or connected with or pertaining to the application or interpretation of international labour standards;
- Disputes and matters related to or connected with child labour, child abuse, human trafficking, or any matter connected therewith or related thereto;
- Disputes relating to determination of question as to the interpretation and application of any;
- Appeals from the decisions of the Registrar of Trade Unions, or matters relating thereto or connected therewith
- Appeals from the decisions recommendations of any administrative body of commission of enquiry, arising from or connected with employment, labour, trade unions or industrial relations
- Such other jurisdiction, civil or criminal and whether to the exclusion of any other court or not
- Disputes relating to or connected with registration of collective agreement;
- Disputes related to, connected with or pertaining to the application of any international convention, treaty or protocol of which Nigeria has ratified, relating to labour, employment, workplace, industrial relations or matters connected therewith
- Entertain any application for the enforcement of the award, decision, ruling or order made by any Arbitral Tribunal or Commission, or Administrative body or Board of Inquiry relating to or connected with, arising from or pertaining to any matter which it has jurisdiction to entertain.
To be continued next week ( culled from the website of the National Industrial Court)