This article was featured in Jus Mundi‘s 2024 Arbitration Year in Review, in collaboration with VYAPs, a yearly collection of articles from jurisdictions all around the globe updating you on arbitration-related developments from the previous year.
THE AUTHORS:
Christopher Awodimila, International Arbitration Attorney
Elizabeth Arubalueze, International Arbitration Practitioner
2024 was a year of consolidation for arbitration in Nigeria. With major innovations introduced in the Arbitration and Mediation Act the previous year, the year under review saw significant improvements in judicial support for arbitration and the emergence of third-party funders, demonstrating the gains of Nigeria’s new legislative framework, and the ambition to be an ideal seat in Africa. On the international scene, Nigeria remained in the news, with the enforcement of the first known arbitration award under the China – Nigeria Bilateral Investment Treaty (2001) (“BIT“) claiming the spotlight. In this report, we provide a bird’s eye view into the most notable developments of the past year.
Market Highlights
LCIA Africa User’s Council Africa Roadshow 2024
In January 2024, the African Users’ Council of the London Court of International Arbitration (“LCIA”) undertook a West Africa roadshow in Ghana and Nigeria. The main objective of the Roadshow was to showcase the LCIA as the premier dispute resolution institution for Africa-related disputes. The Roadshow comprised a series of events (meetings, seminars, sessions and networking events) hosted by law firms and institutions in collaboration with the LCIA. It provided a platform for useful discussions and stakeholder engagements on topical issues in arbitration and the role of arbitral institutions such as the LCIA ensuring the integrity of the arbitral process.
Importantly, the roadshow brought together the arbitration communities in Accra and Lagos in both social events (the LCIA Meet and Mingle Cocktails) and formal engagements such as panel discussions. The business communities in both cities also participated in the events, with representatives from businesses across all sectors. The roadshow also benefitted from a strong delegation from the user’s council and the LCIA Young International Arbitration Group.
The 1st ICC Nigeria Arbitration Days
In July 2024, the International Chamber of Commerce (ICC) hosted the first-ever ICC Nigeria Arbitration Days in Lagos, focusing on the theme “Harnessing the Prospects of Arbitration and ADR in Emerging Hubs” and signaling its deepening engagement with Nigeria’s arbitration landscape. The event brought together practitioners, in-house counsel, and business leaders to discuss how arbitration and Alternative Dispute Resolution (“ADR”) can support business growth in emerging markets.
Discussions explored practical strategies for strengthening Nigeria’s arbitration framework, how arbitral institutions can ensure procedural efficiency, and how the Arbitration and Mediation Act 2023 is shaping dispute resolution in the region. There was also a strong focus on sector-specific arbitration, particularly in energy, infrastructure, and finance, where efficient dispute resolution mechanisms are critical for investor confidence.
Beyond the panel sessions, the event provided a valuable opportunity for networking, reinforcing connections between local and international arbitration practitioners. As the ICC expands its presence in Nigeria, this event marked an important step in fostering a more arbitration-friendly business environment.
The CiArb (Nigerian Branch) Annual Conference
In November 2024, the Chartered Institute of Arbitrators (“CIArb”) Nigerian Branch held its annual conference with the theme “Fresh Perspectives: Back to Basics in ADR.” Against the backdrop of rapid changes in the dispute resolution space, the conference took a step back to examine the fundamentals: party autonomy, procedural efficiency, and best practices in case management.
One of the highlights was the practical workshops designed to refine advocacy skills in arbitration and mediation. The sessions also tackled pressing issues such as the role of arbitral institutions in ensuring procedural integrity and the increasing intersection of mediation with commercial dispute resolution.
Beyond the panel discussions, the conference was, as always, a strong gathering of the arbitration community, from seasoned arbitrators to newer practitioners eager to build their expertise. The induction of new CIArb fellows and members was a key moment, reflecting the continued expansion of Nigeria’s ADR ecosystem.
Significant Cases
Seizure of Three Nigerian Presidential Jets by a Chinese Firm
In October 2024, the Chinese firm, Zhongshan Fucheng Industrial Investment Co. Ltd., intensified efforts to enforce a circa US$70 million award against the Federal Republic of Nigeria. The award resolved the first known claim under the China-Nigeria BIT, a dispute arising from the development of the Ogun Guangdong Free Trade Zone (“FTZ”) in Nigeria. In March 2021, the UNCITRAL Tribunal chaired by Lord Neuberger of Abbotsbury ruled in favour of Zhongshan, and the Final Award was subsequently recognized and enforced in various jurisdictions, including the United Kingdom, Quebec, and Paris.
Nigeria’s efforts to challenge enforcement of the award on grounds of sovereign immunity were rejected by the English courts. The courts found that:
- Nigeria had exceeded the time limit to set aside the enforcement order, thereby waiving its right to raise the defense of sovereign immunity; and
- Nigeria had failed to provide sufficient evidence to support its claim of sovereign immunity. The English Commercial Court therefore granted interim charging orders against two Nigerian properties in the UK, valued between £1.3 and £1.7 million in June and August 2023. Nigeria’s diplomatic immunity defence was also rejected, and a final charging order was granted in June 2024.
In August 2024, the US Court of Appeals for the District of Columbia Circuit upheld the English Court of Appeal’s decision on the enforceability of the Final Award. Subsequently, a Paris court granted an order permitting Zhongshan to seize three presidential jets owned by Nigeria, towards the enforcement of the arbitral award.
Nigerian Court Grants Anti-Suit Injunction in Favour of Arbitration Agreement
In P.E Bitumen Resources (Nigeria) Limited (“PEBR“) v. Cocean Nigeria Integrated Limited (“Cocean“), the High Court of Lagos State issued an anti-suit injunction restraining Cocean from pursuing multiple proceedings in breach of an arbitration agreement. The dispute arose from a transportation agreement entered into by the Parties in May 2019. The agreement was governed by Nigerian law, and it provided for an ICC arbitration seated in Lagos, Nigeria.
Cocean initiated five separate actions against PEBR related to the dispute, including an application at the High Court of Imo State to recover an alleged debt from PEBR. Cocoean also took subsequent actions in trying to restrain the arbitral tribunal from continuing with the arbitration and sought to move the courts to invalidate the ongoing arbitration. On its part, PEBR approached the High Court of Lagos, requesting an anti-suit injunction to restrain Cocean from pursuing any proceedings against it, other than arbitration as agreed by the parties The High Court of Lagos State granted the anti-suit injunction, ordering Cocean to refrain from commencing, prosecuting, or participating in any proceedings against PEBR in any court or tribunal, other than the arbitration.
In reaching its decision, the Court affirmed its discretionary power to grant anti-suit injunctions and emphasised the need for parties to respect arbitration agreements. The court further condemned Cocean for commencing multiple proceedings in breach of the arbitration agreement, which constituted an “abuse of process,” and ordered costs against Cocean’s counsel for indulging in the abuse of process.
P&ID Saga: English Court of Appeal Affirms Nigeria’s Entitlement to Payment of Costs in Sterling, rather than Naira
Following the successful set aside of the US$11 Billion Final Award issued against Nigeria in P&ID v. Ministry of Petroleum of Nigeria reported last year, P&ID lodged an appeal against the costs order of £43 million. In particular, P&ID argued the High Court should have granted costs in Nigerian Naira (“NGN“), rather than Pounds Sterling (“GBP“). This was premised on the assertion that at time of commencing and prosecuting the suit, the fees and disbursements would have cost Nigeria a total of about NGN23 billion; but if P&ID is required to pay GBP43 million in costs at the time of judgment, the naira-sterling exchange rate would ramp up the sum to about NGN76 billion.
The Court of Appeal clarified its jurisdiction to entertain the appeal on the basis that the issue of costs was not a decision made under Section 68 of the Arbitration Act. Consequently, a cost order was not subject to the limitations set by section 68. Nevertheless, the appellate court upheld the lower court’s decision on Nigeria’s entitlement to payment in GBP. The Court held that awarding costs in Pounds Sterling was appropriate since Nigeria had been invoiced, incurred liabilities, and made payments to its legal counsel in GBP.
Supreme Court Affirms “The Existence of Dispute” as a Prerequisite for Referral to Arbitration
In December 2024, the Supreme Court of Nigeria affirmed a High Court decision which enforced an arbitration agreement by referring the parties to arbitration in Sembcorp Eng. Pte Ltd. v. IPCO (WA) Holdings Ltd. [2024] 17 NWLR (Pt. 1968) 531.
Sembcorp and IPCO entered into a contract under which Sembcorp agreed to supply various forms of equipment to IPCO. The contract was to enable IPCO to fulfil its obligations under a contract with the Nigerian National Petroleum Corporation (“NNPC”) for the refurbishment of Bonny Export Terminal in Rivers State. A dispute arose concerning the failure of IPCO to make payments to Sembcorp.
Sembcorp commenced legal proceedings against IPCO. In response, IPCO filed an application for a stay of proceedings under Section 5(1) of the Arbitration and Conciliation Act 1988, the predecessor act to the Arbitration and Mediation Act 2023. The High Court partially upheld the application for a stay of proceedings by entering judgment on the claims that were admitted by the respondents and referring the parties to arbitration on other disputed claims. This decision was upheld by the Court of Appeal and, most recently, the Supreme Court.
At the relevant part, the Supreme Court affirmed that the existence of a dispute is a vital prerequisite for a referral to arbitration under Section 5(1) of the ACA. The Court’s analysis was premised on the content of the relevant arbitration agreement, which evinced parties’ intention to refer “disputes” and “differences” to arbitration. The Apex Court defined a dispute as follows:
“A dispute or difference occurs where two or more people have a disagreement or are unable to agree on a matter or an issue. Hence, there cannot be a dispute or difference where a party has admitted to a point being made by another.”
This decision provides some insight into the Nigerian Supreme Court’s approach to enforcing arbitration agreements. However, it is unclear if the Supreme Court will maintain the same reasoning for applications considered under the extant Arbitration and Mediation Act 2023, especially in light of its section 91(10) which provides that “[i]n the interpretation of [the] Act, regard is to be had to its international origin and to the need to promote uniformity in its application and the observance of good faith and the Court may also have recourse to the travaux preparatoires of the UNCITRAL Model Law on International Commercial Arbitration and Model Law on Commercial Mediation.”
ABOUT THE AUTHORS
Christopher Awodimila is a Nigerian-qualified lawyer with over five years of post-qualification experience practicing litigation and arbitration. He holds an LL.M. degree in International Disputes Settlement from the Centre for International Dispute Settlement (“MIDS”), Geneva, Switzerland. Christopher has worked with the arbitration teams of leading international law firms, including Quinn Emanuel Urquhart & Sullivan LLP (Paris), A&O Shearman (Paris), and LALIVE (Geneva). Prior to this, he served as the Special Assistant to the Attorney-General of Delta State Nigeria. In this role, he advised and assisted the Attorney-General on several high net-worth disputes against and for Delta State. Additionally, Christopher also worked at Broderick Bozimo & Company (Abuja), a law firm which specialises in arbitration and dispute resolution. Through these experiences and education, Christopher has acquired a deep knowledge of international investment arbitration and commercial arbitration.
Elizabeth Ebelechukwu Arubalueze is a recent law graduate with a profound interest in International Arbitration. Building on this passion, she gained valuable experience interning with leading arbitral institutions in Singapore and Nigeria, developing her skills and gaining different perspectives in the field.
Discover more insights into the latest developments in arbitration in 2024 from around the world now
*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
