The Cabotage Vessel Financing Fund(CVFF) In Nigeria
The Cabotage Vessel Financing Fund (CVVF) is an initiative of the Federal Government of Nigeria aimed at providing a credit line to participants in the Nigerian Cabotage trade sector.
This article will be looking at the provisions of the regulatory framework governing this fund, particularly the subtopics of :-
– Its objectives/purposes
– Sources of funding
– Its contributory parties
– Eligibility requirements
– Application requirements
What is the purpose of the CVFF?
– It is utilized by the Nigerian Maritime Administration and Safety Agency (NIMASA) to offer financial assistance and create access to funding by financial institutions with the sole aim of increasing indigenous ship acquisition capacity.
Disbursement of the fund shall be subject to the approval of the minister of transportation upon recommendation by NIMASA.
Who are the recognized contributory parties of the CVVF?
The contributory parties of the CVVF are the following :-
– NIMASA (The Nigerian Maritime Administration and Safety Agency)
– Primarily Lending Institutions (PLIs)
– Beneficiaries of the fund
– Fund managers.
What are the pre-conditions for accessing credit facilities via the CVVF?
Applicants are required to :-
– Prepare bankable feasibility reports subject to independent verification by NIMASA & PLIs.
– Pay all prescribed fees.
– Satisfy the fund of its managerial and operational ability.
– Provide acceptable equity participation as may be required for each project application.
What are the sources of funding for the CVVF?
The Cabotage Act provides that the following shall be paid into the fund :-
– A surcharge of 2% of contract sum on contracts performed by any vessel engaged in Cabotage trade.
– A sum as shall , from time to time, be determined and approved by the National Assembly.
– Monies generated under the Cabotage Act including tariffs, fines and fees for licenses and waivers.
– Such further sums accrued by way of interest paid on and the repayment of principal sums of any loan granted from the fund.
What are the requirements for a CVFF application?
– An application to NIMASA
– The name of the company
– Address of the company
– Amount & Tenure of the loan
– Number/type/size of the vessel to be procured
– Other Cabotage Investment disclosures where applicable
– Level of maritime activities
– Number of vessels owned
– Copies of existing contracts with international oil companies if any
– Benefits of investment to the Nigerian Cabotage regime (maximum of $25 Million).
It should be noted that ONLY Nigerian citizens and shipping companies wholly-owned by Nigerian citizens are eligible to benefit from the CVVF scheme.
Cabotage Trade Waiver Requirements In Nigeria
Cabotage involves the transport of goods along inland waterways and coastal routes. In Nigeria, Maritime Cabotage is regulated by virtue of the Cabotage Act which requires that engaging in Cabotage trade cannot be permitted without registration with the Nigerian Maritime Administration and Safety Agency (NIMASA)
This article will be dealing with the requirements for Cabotage trade licensing in Nigeria which starts with registration under the following categories :
- Wholly- Nigerian Owned Vessels
Requirements For Registrators
– Relevant Cabotage application forms
– Certificate of Nigerian Registry
– Detailed crew list
– Certificate of minimum safe manning
– Evidence of registration of company with NIMASA
– Certified True Copies of CAC Form 2 & CAC Form 7
- Bare Boat Charter Vessels
Registration Requirements
– Relevant Cabotage application forms
– Certificate of Registry
– Detailed crew list
– Certificate of minimum safe manning
– Charter-party agreement
– A copy of the applicant’s memorandum and articles of association (MEMART)
– A certificate of incorporation
– Current Tax clearance certificate
– Evidence of registration of the company with NIMASA
- Cabotage Licensing for Foreign Vessels
Requirements
– Application Form
– Copy of certificate of registry
– Declaration of ownership certificate
– Completed crew declaration form
– Certificate of tonnage measurement
– Passenger ship safety certificate
– Cargo ship safety certificate
– Ship safety equipment certificate
– Certificate of minimum safe manning
– International safety management certificate
– Load line certificate
– Survey certificate
– Safety radio certificate
– Classification certificate
– A copy of current certificate of vessel insurance
– A CTC of the applicant’s certificate of incorporation
– A copy of the applicant’s memorandum and articles of association (MEMART)
– CTCs of the applicant’s CAC forms 7 & 2
– A current tax clearance certificate
– Evidence of registration with NIMASA
– Evidence of payment of registration fees
– An undertaking to train a prescribed number of Nigerian cadets.
What are the requirements for a Cabotage waiver renewal?
– A letter of renewal application by an authorized representative
– A completed Cabotage waiver application form on oath in a Federal High Court
– A completed Cabotage affidavit form
– A foreign certificate of registry for foreign vessels
– A registry certificate for joint venture vessels
– A detailed crew list
– A minimum safe manning certificate
– A certificate of incorporation
– A copy of the applicant’s memorandum and articles of association (MEMART)
– Evidence of 2% surcharge payment
– Evidence of Nigerian Cadet training
– Evidence of dry docking where applicable
– A survey report copy for newly imported vessels
– A copy of the applicant’s Nigerian ship registry certificate.
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