Individual Corruption

The Nigeria Customs Service (NCS) is a notoriously corrupt public institution, according to the Transparency International Global Corruption Barometer 2005. This is corroborated by the Transparency International Global Corruption Barometer 2010, in which more than half of surveyed households who had contact with the customs administration throughout 2009 report to have paid a bribe.

Business Corruption

According to Global Integrity 2010, due to corruption, customs and excise laws are not always enforced uniformly or without discrimination. The process of clearing goods through Nigerian ports is very bureaucratic and prone to corruption, and this is supported by the World Economic Forum Global Enabling Trade Report 2010, which illustrates that trade in Nigeria is impeded by customs procedures and irregular payments, such as bribes taking place during import and export processes.

According to the US Department of State 2011, companies are known to attempt to undervalue their goods to evade duties. Furthermore, due to the high number of companies operating in the informal sector that are not formally taxed, many companies resort to smuggling instead of legal trade. Bribery of customs and port officials remains common. As a response to the high levels of duty evasion, the government has instituted a 100% inspection requirement in the Port of Lagos, which has resulted in massive congestion and delays. However, according to the US Department of State 2011, shippers now report that the efforts to modernise and professionalise the process have reduced the resulting clearance times caused by the congestion and delays.

Political Corruption

The borders of Nigeria are porous, and smuggling through Nigeria's seaports and land borders is common. In particular, the smuggling of subsidised Nigerian petrol is widespread and lucrative. Due to the high levels of smuggling, the Nigeria Customs Service (NCS), a parliamentary organisation, has an armed paramilitary unit. According to the US Department of State 2011, the smuggling is facilitated by the high frequency of corruption amongst customs and port officials.

There have been a number of corruption and fraud scandals involving foreign companies paying a large sum of bribes into the pockets of Nigerian customs officials, in exchange for services such as circumventing customs regulations or to obtain false documentation. One example took place between 2002 and 2005; when according to a 2007 press release by the US Department of Justice, in 2007, three subsidiaries of the oil service company Vetco pleaded guilty to US authorities for authorising a Swiss based freight company, Panalpina, to make a series of illegal payments amounting in total to USD 2.1 million to the Nigerian Customs Service officials in exchange for preferential treatment. Another bribery case involves Transocean Inc., a Swiss based offshore drilling contractor, paying USD 90,000 in bribes in Nigeria in order to get around customs regulations, as reported in a November 2010 news release by the US Department of Justice.

Frequency

The World Bank & IFC: Doing Business 2012:
- It takes an average of 24 days and 10 documents to export a standard container from Nigeria, at a cost of USD 1,263.

- It takes an average of 39 days and 9 documents to import a standard container to Nigeria, at a cost of USD 1,440.

World Economic Forum: The Global Competitiveness Report 2011-2012:
- Business executives give the efficiency of customs procedures (formalities regulating the entry and exit of merchandise) in Nigeria a score of 3.5 on a 7-point scale (1 being 'extremely inefficient' and 7 'extremely efficient').

World Economic Forum: The Global Enabling Trade Report 2010:
- Business executives give the transparency of border administration (irregular payments in exports and imports) a score of 2.8 on a 7-point scale (1 'not transparent' and 7 'transparent').

Transparency International: Global Corruption Barometer 2010:
- 51% of households who had contact with customs services in 2009 report to have paid a bribe.

Transparency International: Bribe Payers Index 2008:
- Business executives give customs a score of 4.3 on a 5-point scale (1 'not at all corrupt' and 5 'extremely corrupt').

The World Bank & IFC: Enterprise Surveys 2007:
- More than 33% of companies expect to give gifts in order to obtain an import licence.