The Central Bank of Nigeria has moved to curb abuse of forex acquisition by dealers as the apex bank banned with immediate effect involvement of third parties in getting forex for imported goods in the country.
The apex addressed dealers and the general public via a circular titeld ‘Destination payment for all Forms M, Letters of Credit and other forms of payment’, signed on Monday by Dr O. S. NNaji, its Director, Trade and Exchange Department, the apex bank
Nnaji said, “Authorised dealers are hereby directed to desist from opening of Form M whose payments are routed through a buying company/agent or any other third parties.
“Accordingly, all authorised dealers are hereby requested to only open Form M for Letters of Credit, bills for collection and other forms of payment in favour of the ultimate supplier of the product or service. The directive is with immediate effect.”
He said the directive was part of continued efforts by the CBN to ensure prudent use of the nation’s forex resources and eliminate incidences of over-invoicing, transfer pricing, double handling charges, and avoidable costs ultimately passed to the average Nigerian consumers.
He added that in line with best practices around the world, the CBN would be immediately introducing a product price verification mechanism to forestall over-pricing and/or mispricing of goods and services imported into the country.
According to the apex bank, all authorised dealers should use the mechanism to verify quoted prices before Forms M are approved.
Form M is a mandatory statutory document to be completed by all importers for the importation of goods into Nigeria.
Without the form, goods cannot be approved for importation into the country.
The documentation process is put in place by the Federal Government through the CBN and the Nigeria Customs Service.