Comparative Guides
Welcome to Mondaq Comparative Guides - your comparative global Q&A guide.
Our Comparative Guides provide an overview of some of the key points of law and practice and allow you to compare regulatory environments and laws across multiple jurisdictions.
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Results: 4 Answers
International Arbitration
1.
Legal framework
1.1
What is the relevant legislation on arbitration in your jurisdiction? Are there any significant limitations on the scope of the statutory regime – for example, does it govern oral arbitration agreements?
 
Nigeria
Arbitration in Nigeria is regulated by:

  • the federally enacted Arbitration and Conciliation Act, contained in Chapter A18 of the Laws of the Federation of Nigeria 2004 (ACA), which started life as a decree promulgated by a military government in 1988 and is based on the 1985 UNCITRAL Model Law on International Commercial Arbitration; and
  • the Arbitration Law of Lagos State No 55, Vol 42 of 2009, which was enacted by the Lagos State House of Assembly in 2009 and draws heavily on the 1996 Arbitration Act of England, Wales and Northern Ireland.

The arbitration regime under both laws is limited to written arbitration agreements. While the ACA is described, in its title, as “An Act to provide a unified legal frame work for the fair and efficient settlement of commercial disputes by arbitration and conciliation”, the only reference to commercial disputes in the body of the legislation is under the part making provision for international arbitration.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
1.2
Does this legislation differentiate between domestic arbitration and international arbitration? If so, how is each defined?
 
Nigeria
The ACA contains provisions relating to both domestic and international arbitration. Part I applies to domestic arbitration, while Part III applies only to international commercial arbitration. The Lagos Arbitration Law makes no distinction between domestic and international arbitration. Although there is no definition of ‘domestic arbitration’ in the ACA, ‘international arbitration’ is defined in Section 57(2) as including the following:

  • The parties to an arbitration agreement have, at the time of conclusion of the agreement, their places of business in different countries;
  • One of the following places is situated outside the country in which the parties have their places of business:
    • the place of arbitration, if such place is determined in or pursuant to the arbitration agreement; or
    • any place where a substantial part of the obligation of the commercial relationship is to be performed or the place with which the subject matter of the dispute is most closely connected;
  • The parties have expressly agreed that the subject matter of the arbitration agreement relates to more than one country; or
  • The parties, despite the nature of the contract, expressly agree that any dispute arising from the commercial transaction shall be treated as an international arbitration.
For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
1.3
Is the arbitration legislation in your jurisdiction based on the UNCITRAL Model Law on International Commercial Arbitration?
 
Nigeria
The ACA is primarily based on the 1985 UNCITRAL Model Law on International Commercial Arbitration. The 2006 amendments to the model law have yet to be incorporated; a bill that seeks to amend the ACA has been passed by the Senate of the National Assembly and is presently before the House of Representatives. Section 53 of the Arbitration and Conciliation Act also refers to the adoption of the UNCITRAL Arbitration Rules in international arbitration agreements. The Lagos Arbitration Law incorporates relevant provisions from the 2006 UNCITRAL Model Law.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
1.4
Are all provisions of the legislation in your jurisdiction mandatory?
 
Nigeria
All provisions of the ACA that relate to domestic arbitration are mandatory, including the procedural rules (the Arbitration Rules) contained in the First Schedule. The Arbitration Rules are optional for international commercial arbitration, with the parties at liberty to adopt any rules they wish. The Lagos Arbitration Law applies in Lagos State only to agreements where it is expressly indicated to be the applicable law. There have been suggestions that the Lagos Arbitration Law is invalid for being ultra vires the legislative powers of the Lagos State legislature, but there have been no judicial pronouncements on the issue.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
1.5
Are there any current plans to amend the arbitration legislation in your jurisdiction?
 
Nigeria
As indicated above, a bill seeking the repeal and re-enactment of the ACA was passed by the Senate on 1 February 2018 and passed its second reading in the House of Representatives on 12 April 2018.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
1.6
Is your jurisdiction a signatory to the New York Convention? If so, have any reservations been made?
 
Nigeria
Yes, Nigeria is a signatory to the New York Convention. Nigeria acceded to the convention on 17 March 1970 and it came into force on 15 June 1970. The convention is set out in Schedule 2 to the Arbitration and Conciliation Act, and is expressly incorporated into Nigerian law. In accordance with Article I(3) of the convention, Nigeria’s applicability of the convention is on the basis of reciprocity to the recognition and enforcement of awards made only in the territory of a member state to the convention and to disputes arising out of legal relationships, whether contractual or not, which are considered as commercial under Nigerian law.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
1.7
Is your jurisdiction a signatory to any other treaties relevant to arbitration?
 
Nigeria
Nigeria is a signatory to various other treaties, such as the International Centre for the Settlement of Investment Disputes Convention and the Economic Community of West African States Energy Protocol. Nigeria has also entered into bilateral investment treaties with Finland, France, Germany, Italy, South Korea, the Netherlands, Romania, Serbia, Spain, Sweden, Switzerland, Taiwan and the United Kingdom. Additionally, Nigeria has entered into investment promotion and protection agreements (IPPAs) with the United Kingdom, France, the Netherlands, Romania, Morocco, Switzerland, Spain, Singapore and South Africa. The purpose of these IPPAs is to protect investments and to settle investment disputes through arbitration. Nigeria also entered into a treaty with the Asian African Legal Consultative Organisation on 26 April 1999, guaranteeing the continued operation of the Regional Centre for International Commercial Arbitration, which was established in Lagos in 1989.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
2.
Arbitrability and restrictions on arbitration
2.1
How is it determined whether a dispute is arbitrable in your jurisdiction?
 
Nigeria
The issue of arbitrability is not codified in Nigeria, and neither the Arbitration and Conciliation Act nor the Lagos Arbitration Law lists disputes that are not arbitrable. The test has been stated to be whether the dispute can be settled lawfully by way of accord and satisfaction (United World Ltd Inc v MTS (1998) 10 NWLR (Pt 568)106). General legal opinion is that matters that impact on the legal status of an individual are not arbitrable. A number of decided cases have described certain disputes as non-arbitrable. For instance, in Kano State Urban Development Board v Fanz Construction Limited ((1990) 4 NWLR (Pt 142) 1 at page 33 paragraphs A – B) the Supreme Court listed the following as non-arbitrable in Nigeria:

  • indictments for an offence of a public nature;
  • disputes arising from an illegal contract;
  • disputes arising from agreements that are void as being by way of gaming or wagering;
  • disputes that lead to a change of status, such as divorce petitions; and
  • any agreement purporting to give an arbitrator the right to give judgment in rem.

The Court of Appeal, in Shell (Nig) Exploration and Production Ltd v Federal Inland Revenue Service (Unreported Appeal CA/A/208/2012; delivered by the Court of Appeal, Abuja on 31 August 2016), stated that tax disputes are non-arbitrable. The decision has been appealed to the Supreme Court and is still pending.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
2.2
Are there any restrictions on the choice of seat of arbitration for certain disputes?
 
Nigeria
There are no restrictions on the choice of seat and the parties are at liberty to agree on the seat.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
3.
Arbitration agreement
3.1
What are the validity requirements for an arbitration agreement in your jurisdiction?
 
Nigeria
Under the Arbitration and Conciliation Act (ACA), arbitration agreements must be in writing and be contained in:

  • a document signed by the parties;
  • an exchange of letters, telex, telegrams or other means of communication which provides a record of the arbitration agreement; or
  • an exchange of statements of claim and defence in which the existence of an arbitration agreement is alleged by one party and not denied by another.

The Lagos Arbitration Law contains similar provisions concerning the written form of an arbitration agreement, but goes further to stipulate that ‘writing’ includes data that provides a record of the agreement or is otherwise accessible so as to be useable for subsequent reference. It further defines ‘data’ in a more extensive manner, so as to better capture electronically generated material.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
3.2
Are there any provisions of legislation or any other legal sources in your jurisdiction concerning the separability of arbitration agreements?
 
Nigeria
Both the ACA (Section 12(2) and the Lagos Arbitration Law (Section 19(2)) provide for the separability of arbitration agreements.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
3.3
Are there provisions on the seat and/or language of the arbitration if there is no agreement between the parties?
 
Nigeria
Sections 16(1) and 18(1) of the ACA provide for the tribunal’s powers as to the language and seat of arbitration in the absence of the parties’ agreements. Section 16 enables the tribunal to determine the language or languages to be used, bearing in mind the relevant circumstances of the case, in the absence of agreement between the parties. Section 18 stipulates that the place of arbitration is to be determined by the tribunal, in the absence of any provision to that effect in the agreement, having regard to the circumstances of the case, including the convenience of the parties. The Lagos Arbitration Law provides, at Section 33(1), for the tribunal to determine the seat of arbitration in the absence of any agreement between the parties; and Section 36(1) provides that the language of the arbitration, in the absence of any agreement between the parties, shall be English.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
4.
Objections to jurisdiction
4.1
When must a party raise an objection to the jurisdiction of the tribunal and how can this objection be raised?
 
Nigeria
Under Section 12(1) of the Arbitration and Conciliation Act (ACA), jurisdictional objections must be raised no later than the date on which the objecting party submits its points of defence or, with respect to a counterclaim, in the reply to the counterclaim. Under Section 12(2), a plea that the tribunal has exceeded the scope of its authority can be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the proceedings. Similar provisions are contained in Section 19 of the Lagos Arbitration Law.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
4.2
Can a tribunal rule on its own jurisdiction?
 
Nigeria
Under both the ACA and the Lagos Arbitration Law, a tribunal may rule on its own jurisdiction, either as a preliminary question or in an award on the merits. Under both laws, such ruling is stated to be final and binding.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
4.3
Can a party apply to the courts of the seat for a ruling on the jurisdiction of the tribunal? In what circumstances?
 
Nigeria
Given the provisions of Section 34 of the ACA and Section 59(1) of the Lagos Arbitration Law, the courts shall not intervene in any matter governed by the ACA other than as provided in the ACA; and in the absence of any express provision enabling applications in respect of the jurisdiction of the tribunal to be made to the courts, the parties may not apply to the courts in Nigeria for a ruling on the jurisdiction of the tribunal. Where the tribunal’s decision on its jurisdiction is an issue, it would appear that recourse may be sought only in connection with an application to set aside an award.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
5.
The parties
5.1
Are there any restrictions on who can be a party to an arbitration agreement?
 
Nigeria
The parties to an arbitration agreement must have the capacity to enter into the agreement. Beyond this, there are no restrictions.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
5.2
Are the parties under any duties in relation to the arbitration?
 
Nigeria
The Lagos Arbitration Law imposes an express duty on parties to “do all things necessary for the proper and expeditious conduct” of the arbitration proceedings. The Arbitration and Conciliation Act (ACA) does not expressly impose such a duty on the parties.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
5.3
Are there any provisions of law which deal with multi-party disputes?
 
Nigeria
There are no provisions in the ACA dealing with multi-party disputes. However, the parties may agree to confer on the tribunal, in the case of multiplicity of claims, the power to consolidate the claims or join other claims. The Lagos Arbitration Law makes express provision for the consolidation of arbitration proceedings or concurrent hearing upon agreed terms.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
6.
Applicable law issues
6.1
How is the law of the arbitration agreement determined in your jurisdiction?
 
Nigeria
The law of the arbitration agreement is determined in the same manner as that of an ordinary contract. The first step is to ascertain whether the parties have made an express choice of law to be applied to the arbitration agreement. Where such a choice has been made, that law prevails. Where there is no express choice of law, it becomes necessary to consider whether any choice can be implied from the circumstances. Where no law is implicit, the agreement will be governed by the law with which the agreement has the closest and most real connection.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
6.2
Will the tribunal uphold a party agreement as to the substantive law of the dispute? Where the substantive law is unclear, how will the tribunal determine what it should be?
 
Nigeria
Both the Arbitration and Conciliation Act (ACA) and the Lagos Arbitration Law, in their respective rules of procedure (Articles 33 and 34 respectively), require the tribunal to apply the law designated by the parties as applicable to the substance of the dispute. The Lagos State rules go further to direct that, in the absence of any such designation, the tribunal is to apply the law that it determines to be appropriate. Under the ACA, it is submitted that the position is similar, in that the tribunal should apply the law with which the agreement has the closest and most real connection.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
7.
Consolidation and third parties
7.1
Does the law in your jurisdiction permit consolidation of separate arbitrations into a single arbitration proceeding? Are there any conditions which apply to consolidation?
 
Nigeria
The Arbitration and Conciliation Act (ACA) does not empower the tribunal to consolidate separate arbitrations. Section 40 of the Lagos Arbitration Law states that the parties are free to agree to consolidate arbitration proceedings with other proceedings, and concurrent hearings may be held on agreed terms.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
7.2
Does the law in your jurisdiction permit the joinder of additional parties to an arbitration which has already commenced?
 
Nigeria
The ACA contains no provisions on the joinder of a non-signatory party or an additional party to the arbitration proceedings. However, given that there is no express prohibition, it would appear that, with the consent of the existing parties to the arbitration, a non-signatory party or an additional party may be joined to the arbitration. The Lagos law further provides that a party that was not originally a party to the proceedings may be joined with the consent of the other parties.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
7.3
Does an arbitration agreement bind assignees or other third parties?
 
Nigeria
Assignees will ordinarily be bound by an arbitration agreement. Only third parties that become bound by an agreement, such as personal representatives of a party to an agreement where obligations succeed the deceased, will be bound by the agreement.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.
The tribunal
8.1
How is the tribunal appointed?
 
Nigeria
The Arbitration and Conciliation Act (ACA) and the Lagos Arbitration Law provide for the default appointment of arbitrators. The general position is that the parties determine the procedure for the appointment of the arbitrators (Section 7(1)). However, where the parties have not agreed on a procedure for appointment, the ACA provides a default procedure under Section 7(2). Where the parties do not agree on the appointment of a sole arbitrator or the third arbitrator in a three-person tribunal, resort is to the court in domestic arbitrations. In international arbitrations, recourse is to the appointing authority: that is, the secretary general of the Permanent Court of Arbitration at The Hague. Section 8 of the Lagos Arbitration Law makes the Lagos Court of Arbitration the appointing authority where the parties fail to provide alternative default provisions.

Under both laws, the appointment is made according to the default provisions, on the application of any party to the arbitration agreement, if:

  • a party fails to appoint its arbitrator within 30 days of receipt of the request to do so by the other party; or
  • the two arbitrators fail to agree on the third arbitrator within 30 days of their appointment.

In addition, where any of the parties, the arbitrators or the relevant institution fails to take any steps required of it, any party can apply to the court or the Lagos Court of Arbitration respectively to take the necessary action, unless the parties’ agreement provides for any other recourse (Section 7(3) of the ACA and Section 8(4) of the Lagos Arbitration Law).

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.2
Are there any requirements as to the number or qualification of arbitrators in your jurisdiction?
 
Nigeria
The ACA does not specify the number and qualifications of arbitrators, and parties are free to select their preferred arbitrators. In the absence of an agreement as to number, the default number of arbitrators is three for arbitrations to which the ACA applies and one for arbitrations conducted under the Lagos Arbitration Law.

Neither the ACA nor the Lagos Arbitration Law stipulates any qualification for appointment as an arbitrator, and under Section 44(10) of the ACA no one can be disqualified from appointment as arbitrator by reason of nationality.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.3
Can an arbitrator be challenged in your jurisdiction? If so, on what basis? Are there any restrictions on the challenge of an arbitrator?
 
Nigeria
Yes, the appointment of an arbitrator can be challenged, on the basis that the arbitrator:

  • has failed to disclose circumstances likely to give rise to any justifiable doubts as to his or her impartiality and independence; or
  • does not possess the qualifications agreed by the parties.

The parties are free to determine the procedure to be followed when challenging an arbitrator. Under the ACA, where a party intends to challenge the appointment of an arbitrator, it shall, within 15 days of receiving notification of such appointment, send a written statement to the tribunal giving its reasons. The written statement must be notified to the other party and to other members of the tribunal. The arbitrator must withdraw if the other party agrees to the challenge; even if the other party does not agree to the challenge, the arbitrator can still decide to withdraw. Unless the arbitrator decides to withdraw or the other party agrees to the challenge, the tribunal and, in the case of an international arbitration, the appointing authority shall decide on the challenge to the appointment.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.4
If a challenge is successful, how is the arbitrator replaced?
 
Nigeria
Where a challenge is successful, the replacement arbitrator is appointed according to the same rules as applied to the appointment of his or her predecessor. Where an arbitrator dies or resigns in the course of the arbitration proceedings, fails to act or is unable to perform his or her functions, he or she can also be replaced.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.5
What duties are imposed on arbitrators? Are these all imposed by legislation?
 
Nigeria
Generally, an arbitrator has the duty to decide disputes on the evidence before him or her, acting judicially and in accordance with the arbitration agreement and the law. The ACA also stipulates that an arbitrator has the duty to:

  • give the parties adequate notice of the date, place and time of hearings;
  • ensure that the parties are accorded equal treatment and are given full opportunity to present their cases (Section 14 of the ACA);
  • make disclosure relating to independence and impartiality (Section 8 of the ACA; Article 9 of the Arbitration Rules);
  • communicate expert reports to the parties (Section 20(4) of the ACA);
  • decide ex aequo et bono or as amiable compositeur only where authorised to do so by the parties (Section 22(3) of the ACA);
  • decide and dispose of all issues submitted to it by the parties;
  • give a reasoned and valid award, ensure that the award is enforceable; and
  • in the absence of provisions, conduct the proceedings in such a way as to ensure a fair hearing (Section 15 of the ACA).
For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.6
What powers does an arbitrator have in relation to: (a) procedure, including evidence; (b) interim relief; (c) parties which do not comply with its orders; (d) issuing partial final awards; (e) the remedies it can grant in a final award and (f) interest?
 
Nigeria
(a) Procedure, including evidence?

The tribunal’s powers, as they relate to procedure, are derived from the arbitration agreement, the relevant legislation and the applicable procedural rules under the legislation. The tribunal has the power to:

  • rule on its own jurisdiction;
  • extend the timeframe for filing case statements, pleadings and written statements;
  • issue a consent award upon settlement or agreement of the parties; and
  • of its own volition, correct in the award any errors in computation, clerical or typographical errors or any errors of a similar nature, and terminate the arbitration proceedings.

With regard to evidence, the tribunal has the power to:

  • order the production of evidence;
  • administer oaths or take affirmations of parties and witnesses appearing before it;
  • determine the admissibility, relevance, materiality and weight of any evidence placed before it; and
  • admit relevant evidence such as statements, documents, other information, expert reports and evidentiary documents.

(b) Interim relief?

Under the ACA, the tribunal has the power to order any party to take such interim measures of protection as the tribunal may consider necessary in respect of the subject matter of the dispute and to require any party to provide appropriate security in connection with any measure taken (Section 13). There is no restriction on the types of interim relief which the tribunal can grant; however, in awarding interim relief, the tribunal should be careful to act within the scope of its jurisdiction as determined from the arbitration agreement and the applicable law. Although Section 13 of the ACA confers on the tribunal the power to grant interim relief without recourse to the court, it is doubtful whether the tribunal can enforce compliance with its interim orders, since it has no coercive powers.

The Lagos Arbitration Law contains more detailed provisions concerning the grant and enforcement of interim relief (Sections 21 to 30), which may be sought from either the High Court or the tribunal.

(c) Parties which do not comply with its orders?

Where a party fails or refuses to comply with the tribunal’s orders - for example, to produce documents - the tribunal cannot compel the party to do so, although it may make adverse inferences regarding the failure to comply, if appropriate.

(d) Issuing partial final awards?

Under Article 32 of the Arbitration Rules of the ACA, an arbitrator may make interim, interlocutory or partial awards. Under Article 33 of the Lagos Arbitration Law, the tribunal may make “separate awards on different issues at different times”.

(e) The remedies it can grant in a final award?

The ACA does not stipulate the types of remedies that a tribunal can grant. Based on common law, the tribunal has implied powers to grant the relief sought by a party if it could be granted by a high court. This includes declaratory relief, monetary awards, specific performance and the award of interest. The ACA also gives the tribunal the power to award costs.

In contrast, Section 38 of the Lagos Arbitration Law provides that the parties are free to agree on the remedies that may be granted by the tribunal and specifically empowers the tribunal to make declarations as to any matter to be determined in the proceedings, and to order the payment of sums of money in any currency. In addition, the tribunal is specifically granted the same power as a court to order:

  • a party to do or refrain from doing anything;
  • the specific performance of a contract (other than a contract relating to land); and
  • the rectification, setting aside or cancellation of a deed or other document.

(f) Interest?

The ACA contains no express provision empowering the tribunal to award interest. However, under the ACA, interest is usually awarded on principal claims at rates established by evidence of the party seeking the award of interest. The award of interest on costs is unusual, but there is no express prohibition against the award of interest on costs.

The Lagos Arbitration Law, by contrast, provides at Section 46 that arbitrators may award interest.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.7
How may a tribunal seated in your jurisdiction proceed if a party does not participate in the arbitration?
 
Nigeria
The ACA stipulates how the tribunal should proceed if a party does not participate in the arbitration. Section 21 provides that:

  • where the claimant fails to state its claim, the tribunal shall terminate the proceedings;
  • where the respondent fails to state its defence, the tribunal may continue the proceedings without treating such failure in itself as an admission of the claimant’s allegations; and
  • where any party fails to appear at a hearing or to produce documentary evidence, the tribunal may continue the proceedings and make an award.

Section 41 of the Lagos Arbitration Law contains similar provisions with regard to party defaults.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
8.8
Are arbitrators immune from liability?
 
Nigeria
No provision in the ACA confers immunity on arbitrators. Section 18 of the Lagos Arbitration Law confers immunity on an arbitrator for anything done or omitted in the discharge of his or her functions as arbitrator, unless the act or omission is determined to have been in bad faith.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
9.
The role of the court during an arbitration
9.1
Will the court in your jurisdiction stay proceedings and refer parties to arbitration if there is an arbitration agreement?
 
Nigeria
The ACA has two separate provisions (Sections 4 and 5) relating to the stay of proceedings, which can produce different effects. Section 4, which has mandatory application, provides that the court must stay proceedings and refer the parties to arbitration where an action which is the subject of an arbitration agreement is brought before it, if a party so requests no later than when submitting its first statement on the substance of the dispute. Section 5, on the other hand, grants the court discretion as to whether to stay proceedings. It provides that if a party to an arbitration agreement commences any action in any court with respect to any matter that is the subject of that arbitration agreement, a counterparty to the arbitration agreement may, at any time after appearance and before delivering any pleadings or taking any other steps in the proceedings, apply to the court to stay the proceedings and refer the parties to arbitration. The court may stay the proceedings if it is satisfied that there are no sufficient reasons why the matter should not be referred to the arbitration.

The Lagos Arbitration Law contains no such contradiction, as Section 6 makes it mandatory for the court to grant a stay where an action brought before it is the subject of an arbitration agreement, on the application of a party by no later than submission of its first statement on the substance of the dispute, so long as it concerns that matter.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
9.2
Does the court in your jurisdiction have any powers in relation to an arbitration seated in your jurisdiction and/or seated outside your jurisdiction? What are these powers? Under what conditions are these powers exercised?
 
Nigeria
Section 34 of the ACA and Section 59(1) of the Lagos Arbitration Law limit the scope of court intervention in the arbitration process to the extent provided in the legislation. Nigerian courts have the power to assist in arbitrations by:

  • staying proceedings and referring the parties to arbitration;
  • appointing an arbitrator under the ACA;
  • issuing witness subpoenas;
  • setting aside awards; and
  • enforcing awards.

In its 2013 decision in Statoil (Nig) Ltd v NNPC ([2013] 14 NWLR (PT 1373) 1) and its 2014 decision in Nigerian Agip Exploration Limited v NNPC ((2014) 6 CLRN 150 (CA) 176), the Court of Appeal affirmed that Section 34 of the ACA limits the ability of courts to intervene in arbitration matters to the specific instances contained in the legislation. However, in its 2016 decision in The Shell Petroleum Development Company of Nigeria Limited v Crestar Integrated Natural Resources Limited ((2016) 9 NWLR (Pt 1517) page 300), the Court of Appeal, while repeating the opinion contained in Statoil and Nigerian Agip Exploration, went further to distinguish between domestic arbitration governed by the ACA and international arbitration, which it ruled is not regulated by the ACA. Having made this somewhat dubious distinction, the court went on to hold that the Nigerian courts, in exercising their general powers to grant injunctions, may issue injunctions relating to international arbitration not governed by the ACA. The court then went on to restrain the continuation of an International Chamber of Commerce arbitration that was ongoing in London. That decision has been appealed to the Supreme Court.

The present position, on the back of these decisions, is that the extent to which the Nigerian courts may intervene in domestic arbitration is limited to the express powers granted by the relevant arbitration legislation. With regard to arbitration not governed by domestic arbitration legislation, the Nigerian courts may exercise the powers that they ordinarily possess.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
9.3
Can the parties exclude the court's powers by agreement?
 
Nigeria
No provision in either law precludes the parties from excluding the court’s powers by agreement. However, agreements that oust the jurisdiction of the courts may be held to be contrary to Nigerian public policy and unenforceable.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
10.
Costs
10.1
How will the tribunal approach the issue of costs?
 
Nigeria
Under the ACA, five items are recognised as comprising the costs of an arbitration:

  • the tribunal’s fees;
  • the travel and other expenses incurred by the arbitrators;
  • the costs of expert advice and other assistance required by the tribunal;
  • the travel and other expenses of witnesses, to the extent that these are approved by the tribunal; and
  • the reasonable costs of legal representation and assistance.

The Lagos Arbitration Law recognises these five items and includes a sixth: the fees and expenses of the appointing authority.

In the rules under both laws, in principle, costs are to be borne by the unsuccessful party. However, the tribunal is entitled to apportion each of the above costs between the parties if it determines this to be reasonable. The tribunal or appointing authority is also empowered to request that the parties deposit advances for the recognised costs.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
10.2
Are there any restrictions on what the parties can agree in terms of costs in an arbitration seated in your jurisdiction?
 
Nigeria
There are no restrictions as to what the parties can agree in terms of an arbitration seated in Nigeria, with regard to the apportionment of costs. For example, it is not uncommon for the parties to agree that each side will bear its own costs or that a particular party will pay all or a different proportion of the costs.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
11.
Funding
11.1
Is third-party funding permitted for arbitrations seated in your jurisdiction?
 
Nigeria
Third-party funding is not prohibited in Nigeria. No laws in Nigeria expressly prohibit third-party funding. The common law crimes and torts of champerty and maintenance, which may prevent third-party funding in some common law jurisdictions, are not part of Nigerian law and therefore cannot operate to prevent third-party funding.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
12.
Award
12.1
What procedural and substantive requirements must be met by an award?
 
Nigeria
Under Section 26 of the Arbitration and Conciliation Act (ACA) and Section 47 of the Lagos Arbitration Law, an award must be in writing and be signed by the arbitrators or by a majority thereof. The award must also contain:

  • the reasons upon which it was based (unless both parties have agreed that no reasons need be given);
  • the date on which it was made; and
  • the place of arbitration.

A copy of the award must further be delivered to each party.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
12.2
Must the award be produced within a certain timeframe?
 
Nigeria
The legislation in Nigeria does not stipulate any timeframe for the issuance of awards. However, it is expected that the award must be made within a reasonable timeframe.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
13.
Enforcement of awards
13.1
Are awards enforced in your jurisdiction? Under what procedure?
 
Nigeria
Awards are enforced in Nigeria. Awards in domestic arbitration can be enforced by the court under procedures provided under both the Arbitration and Conciliation Act (ACA) and the Lagos Arbitration Law, and shall be recognised as binding upon application in writing to the court (Section 31 of the ACA and Section 56 of the Arbitration Law). Under the Lagos Arbitration Law, no distinction is made between domestic and foreign awards.

The ACA incorporates the New York Convention in its Second Schedule. Under Section 54(1), awards from contracting states may be enforced in Nigeria, provided that:

  • such contracting state has reciprocal legislation recognising the enforcement of arbitral awards made in Nigeria in accordance with the provisions of the convention; and
  • the award concerns a dispute arising out of a contractual relationship.

The party wishing to enforce the award must supply the following:

  • a duly authenticated original award or a duly certified copy thereof;
  • the original arbitration agreement or a duly certified copy thereof; and
  • where the award or arbitration agreement was not made in the English language, a duly certified translation thereof into the English language.
For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
14.
Grounds for challenging an award
14.1
What are the grounds on which an award can be challenged, appealed or otherwise set aside in your jurisdiction?
 
Nigeria
Awards cannot be appealed in Nigeria. However, under Sections 29 and 30 of the ACA, awards can be challenged and set aside if the aggrieved party can furnish proof that:

  • the award contains matters beyond the scope of submission to arbitration;
  • the arbitrator misconducted himself or herself; or
  • the award was improperly procured.

An award is final and cannot be appealed, and the Court of Appeal does not have jurisdiction to hear appeals of decisions of tribunals. However, the Court of Appeal can sit over a decision of the High Court on a challenge of an award up to the Supreme Court. Section 49 also states that a party bringing an application for an award to be set aside must prove the following:

  • A party to the arbitration agreement was under some legal incapacity;
  • The arbitration agreement is invalid under the law chosen by the parties or, failing such an indication, under Nigerian law;
  • The aggrieved party was not given proper notice of the appointment of an arbitrator or of the arbitration proceedings, or was otherwise unable to present its case;
  • The award deals with a dispute not contemplated by, or not falling within the terms of, the submission to arbitration;
  • The award addresses matters which are beyond the scope of the submission to arbitration;
  • The composition of the tribunal or the arbitral procedure was not in accordance with the parties’ agreement;
  • Where there is no agreement between the parties as to the tribunal or the arbitral procedure, the composition of the tribunal or the arbitral procedure was not in accordance with the Arbitration and Conciliation Act;
  • The subject matter of the dispute is incapable of settlement by arbitration under Nigerian law; or
  • The award is against Nigerian public policy.

The Lagos Arbitration Law contains a similar list of requirements for setting aside awards under Section 57.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
14.2
Are there are any time limits and/or other requirements to bring a challenge?
 
Nigeria
A party that is aggrieved by an arbitral award can apply to the High Court to set aside the award within three months of the date of the award or correction of the award. In the case of an additional award, the aggrieved party may apply to the court from the date on which the request for the additional award is disposed of by the tribunal.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
14.3
Are parties permitted to exclude any rights of challenge or appeal?
 
Nigeria
Arbitral awards are not appealable, but they can be challenged based on the instances listed in question 41. Therefore, agreements that exclude right to appeal do not affect the aggrieved party’s right to challenge the award.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
15.
Confidentiality
15.1
Is arbitration seated in your jurisdiction confidential? Is a duty of confidentiality found in the arbitration legislation?
 
Nigeria
A thorough review of both the Arbitration and Conciliation Act (ACA) and the Lagos Arbitration Law confirms that there are no rules of confidentiality in arbitration proceedings in Nigeria. Thus, the extent of confidentiality and privacy in any proceedings is a matter to be determined by the arbitration agreement between the parties and the discretion of the tribunal. However, arbitration proceedings are generally considered confidential and private in Nigeria by practitioners and users alike. Article 25(4) of the Arbitration Rules of the ACA provides that hearings shall be in camera, unless the parties agree otherwise.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore
15.2
Are there any exceptions to confidentiality?
 
Nigeria
Exceptions to confidentiality include where the parties consent or where a court order states that information pertaining to arbitration proceedings may be disclosed.

For more information about this answer please contact: Babajide Ogundipe from Sofunde Osakwe Ogundipe & Belgore