What It Means
The Pre-Arrival Assessment Report, universally known as PAAR, is a cornerstone of Nigerian import logistics. Issued by the Nigeria Customs Service on behalf of the Central Bank of Nigeria, it replaced the old Risk Assessment Report (RAR) system.
When a dealer imports a car, their bank opens a Form M. Based on the shipping documents, Customs then issues the PAAR, which explicitly states the amount of duty, VAT, and other levies that must be paid to clear the vehicle. The PAAR is generated before the ship docks at Apapa or Tin Can Island.
Understanding PAAR is vital because it locks in the exchange rate for duty payment. In a volatile economy where the Naira fluctuates aggressively against the Dollar, the exact date a PAAR is generated can mean a difference of millions of Naira in clearing costs. If the CBN exchange rate jumps while the car is on the water, but the PAAR was generated at the older, lower rate, the importer saves money.
In the Nigerian Market
In the daily operations of car dealers in Lagos, PAAR is a major buzzword. Delays in the issuance of PAAR by banks lead to port demurrage (storage penalties), which directly increases the final selling price of the car.
Furthermore, unscrupulous agents sometimes attempt to "work the PAAR"—manipulating the declared year of manufacture or vehicle specifications to generate a PAAR with a lower duty assessment. If Customs physically inspects the car and finds a discrepancy between the car and the PAAR, they issue a "Debit Note" (DN), forcing the importer to pay the difference plus penalties.
How It's Used
"The vessel has arrived in Lagos, but I cannot start clearing because the bank has not issued the PAAR yet. I will end up paying heavy demurrage."
Buyer's Tip
As an end-user buyer, you won't interact with the PAAR directly, but if you are pre-ordering a Tokunbo car and the dealer asks for a price adjustment, ask them to show you the PAAR and the Customs Debit Note to prove that official duties were higher than anticipated.
Seller's Tip
When clearing vehicles, ensure your agent accurately declares the vehicle specs. Attempting to get a lower PAAR by declaring a 2018 model as a 2014 model almost always results in a heavy Customs Debit Note at the port, delaying your exit and wiping out your profit.
Common Misconceptions
A common misconception among private importers is that the price you bought the car for in the USA determines the duty. It does not. Customs uses their own internal valuation database to generate the PAAR. Even if you got the car for free, the PAAR will assess duty based on the standard market value of that vehicle.
Effect on Price
The PAAR directly dictates the legal clearing cost of a vehicle. A high PAAR assessment forces the dealer to raise the final selling price. Sudden policy changes by the CBN regarding the import exchange rate for PAAR calculation can cause the price of all incoming Tokunbo vehicles to jump overnight.