International Arbitration 2025 Comparisons

Prevalence and Use of International Arbitration in Nigeria

International arbitration has become an increasingly prominent method of resolving commercial disputes involving Nigerian parties, particularly where foreign investors, multinational corporations or cross-border commercial arrangements are involved. Historically, litigation before Nigerian courts was the primary route for dispute resolution, but there has been a marked shift in practice – driven by the need for neutrality, commercial confidentiality, swiftness in dispute resolution and the enforceability of arbitral awards under international instruments such as the New York Convention (to which Nigeria has been a party since 1970).

Domestic parties frequently agree to resolve disputes by international arbitration when entering into contracts with foreign counterparties, particularly in sectors like energy, infrastructure, construction, and maritime. The arbitration clauses often provide for a foreign seat (commonly London, Paris, Singapore or Dubai) and application of established institutional rules (such as ICC, LCIA or UNCITRAL). The choice of an offshore seat is typically to assure foreign investors of neutrality and efficiency.

In practice, international arbitration appears in Nigeria in several ways:

• It is frequently included in contracts by Nigerian companies entering into joint ventures, oil and gas, engineering, procurement and construction contracts, or trade agreements with foreign counterparties.
• Parties regularly seek to enforce foreign arbitral awards against assets located in Nigeria.
• Nigeria is also occasionally chosen as the seat of arbitration, although London, Paris and Dubai remain popular alternatives, especially when foreign investors are involved.

While Nigerian law recognises and supports arbitration, litigation remains popular – especially for disputes that are wholly domestic in nature or where parties prefer the authority and familiarity of the courts. That said, the recently enacted Arbitration and Mediation Act, 2023 (“AMA” or the “2023 Act”) has enhanced confidence in Nigeria as a potential seat of arbitration by modernising the legal framework, expressly recognising emergency arbitrators and interim measures, and codifying the presumption of arbitral autonomy.

Overall, international arbitration is most commonly seen in Nigeria either as a contractually chosen method of dispute resolution in cross-border transactions or in the context of recognising and enforcing foreign arbitral awards. Though there is growing interest in hosting arbitrations seated in Nigeria, the majority of truly “international” cases involving Nigerian parties still tend to be seated abroad.

Industries Driving International Arbitration Activity in Nigeria

In recent years, the most significant international arbitration activity in Nigeria has come from the energy and natural resources sector, especially oil and gas. This is hardly surprising given Nigeria’s status as one of Africa’s largest oil producers and the complexity and value of contracts in this industry. Disputes often arise from production sharing contracts, joint venture arrangements, and service agreements involving multinational oil companies and Nigerian companies or multinationals and the Nigerian government or its agencies.

Beyond oil and gas, the power sector has also seen a steady rise in international arbitration cases. The sector’s reform and privatisation process has led to complex contractual arrangements between Nigerian entities and foreign investors, which often designate arbitration as the dispute resolution method to protect foreign investment and ensure neutrality.

Other industries experiencing notable arbitration activity include:

• construction and infrastructure, driven by large-scale public-private partnership projects and foreign-financed developments;
• shipping and maritime, given Nigeria’s strategic coastal position and its active shipping and offshore support industries; and
• telecommunications, where foreign investment and licensing arrangements sometimes lead to cross-border disputes.

The preference for arbitration in these industries is largely driven by the need for specialised dispute resolution, confidentiality, enforceability of awards internationally, and confidence in a process that can proceed even if local courts are slow or unpredictable. The complexity and high value of contracts in these sectors make arbitration a natural choice to manage risk and protect commercial interests.

Preferred Arbitral Institutions for International Disputes in Nigeria

International arbitration involving Nigerian parties often proceeds under established global rules administered by bodies such as the International Chamber of Commerce (ICC), International Centre for Settlement of Investment Disputes and the London Court of International Arbitration (LCIA).

Multinationals often favour international arbitration or their predictability, strong case management and global enforcement network under the New York Convention. They are also popular due to their efficiency, experienced tribunal panels and flexibility, especially where the seat is London. On its part, the ICSID provides treaty-based jurisdiction and awards enforceable without local judicial review.

However, in addition to these, domestic institutions such as the Lagos Court of Arbitration and Regional Centre for International Commercial Arbitration have gained traction as they offer proximity to federal agencies and governmental bodies.

No entirely new national arbitral body has been established in Nigeria. Instead, existing centres have focused on expanding their services and infrastructure such as the Lagos Court of Arbitration enhancing its digital case-management platform and introducing an emergency-arbitrator protocol in late 2024, following the enactment of the AMA in 2023.

Designated Courts for Arbitration Related Matters in Nigeria

There is no specialised “international commercial court” solely dedicated to arbitration matters. Instead, the regular superior courts of record handle arbitration‑related disputes. While Nigeria has not formally established a separate international commercial court, the combination of statutory jurisdiction under the AMA and the practical concentration of arbitration-related matters in certain High Court divisions (particularly in commercial hubs like Lagos and Abuja) means that parties typically benefit from judges with considerable arbitration expertise.

In practice, specific courts have developed de facto specialisation:

• State High Courts and the Federal High Court: Both have jurisdiction under the AMA to hear applications for recognition, enforcement, and challenges to arbitral awards. The Federal High Court also hears cases involving issues within its exclusive jurisdiction, such as admiralty, banking, and intellectual property, when these overlap with arbitration.
• Lagos State High Court (Commercial Division): Widely regarded as Nigeria’s most arbitration-savvy court, this division often handles complex commercial arbitration-related cases, both domestic and international. Judges there frequently receive arbitration-specific training and are experienced in managing applications under the AMA.
• Courts of Appeal and the Supreme Court: They hear appeals from lower courts, primarily on questions of jurisdiction, procedural issues relating to arbitration, enforcement or setting aside proceedings.

Governing Legislation for International Arbitration in Nigeria

Arbitration in Nigeria is governed by the AMA, which is substantially modelled on the UNCITRAL Model Law, incorporating its core principles to ensure procedural fairness, respect for party autonomy, and limited judicial intervention. Notably, the Act mirrors the Model Law’s approach to the finality of awards and provides a framework that supports party equality and the tribunal’s competence to rule on its own jurisdiction.

While the Act retains the Model Law’s structure, it also introduces practical and innovative features designed to enhance Nigeria’s attractiveness as an arbitral seat, such as:

• Emergency Arbitrators: The Act expressly provides for the appointment of emergency arbitrators, enabling parties to seek urgent interim relief before a tribunal is constituted – a modern addition that the original Model Law does not cover.
• Third-party Funding: Another forward-looking innovation is the express recognition of third-party funding arrangements, subject to disclosure obligations to ensure transparency.
• Award Review Tribunal: Uniquely, the Act permits parties to agree to a review mechanism for arbitral awards before they become final, offering an additional opportunity to address potential errors within the arbitral process itself rather than through court challenges.

Recent Developments in Arbitration Law and Prospective Reforms

Over the past year, Nigeria has already implemented the AMA which is the most transformative arbitration reform in recent history. This new legislation replaced the older Arbitration and Conciliation Act and represented a major modernisation of Nigeria’s arbitration framework.

The 2023 Act introduced several significant innovations, including clear provisions for emergency arbitration, third-party funding transparency, party-driven award review panels, and streamlined mechanisms for consolidation and joinder of proceedings. These measures align Nigeria more closely with international norms and enhance its competitiveness as a seat for both commercial and investment arbitration.

At present, there are no pending bills or legislation expected to further amend the new Act. However, policymakers and key stakeholders, including the judiciary, legal practitioners, and arbitration practitioners/centres are discussing practical measures to enhance the infrastructure supporting arbitration.

Legal Requirements for Enforceable Arbitration Agreements in Nigeria

Under Nigerian law, arbitration agreements must meet the following essential requirements to be legally enforceable:

• Written Form and Clarity of Intent: The agreement must be in writing (recorded by any means, such as electronic communication, provided the content is accessible for future reference) and clearly express the parties’ intention to submit disputes to arbitration. While parties often incorporate arbitration clauses directly into commercial contracts, separate arbitration agreements are equally enforceable. Additionally, the language used should reflect an unequivocal commitment to arbitrate.
• Capacity and Subject Matter: Parties entering into an arbitration agreement must be entities or persons recognised under Nigerian law as capable of contracting. Additionally, the dispute must be arbitrable under Nigerian law.
• Fundamental contract principles, such as consideration, offer and acceptance, must be complied with.

Limits to Arbitrability Under Nigerian Law

There are subject matters that cannot be referred to arbitration, as these are considered to belong to the exclusive domain of the courts due to overriding questions of public interest, policy or statutory mandate. These include criminal matters; matrimonial causes and family law issues such as child custody; winding-up of companies; disputes involving title to land, debt recovery and matters involving taxation and revenue collection.

The general approach applied by Nigerian courts is to ask whether the dispute is capable of being settled by private agreement without affecting public rights or interests. If resolution would affect third‑party rights, invoke public law considerations, or contravene statutory provisions, it is typically deemed non‑arbitrable.

Determining the Law Governing the Arbitration Agreement

In cases such as Statoil Nigeria Limited v Nigerian National Petroleum Corporation (2013) 14 NWLR (Pt. 1373) 1, Nigerian courts generally follow well‑established principles of party autonomy and commercial certainty. Where the parties have expressly chosen the law governing the arbitration agreement, courts give effect to that choice. If there is no express choice, courts typically consider whether there is an implied choice, for instance, the substantive law chosen to govern the underlying contract. In the absence of an express or implied choice, Nigerian courts look to the system of law with which the arbitration agreement is most closely connected and this is often the law of the seat of arbitration. This was the kernel of the decision in Zenith Global Merchant Ltd v Zhongfu Int’l Investment (Nig) FZE & 2 Ors (2017) 7 CLRN 69.

Enforcement of Arbitration Agreements

Nigerian courts usually recognise that an arbitration agreement creates a contractual obligation to refer disputes to arbitration and will generally uphold it by staying parallel court proceedings. Under Section 5 of the AMA, where a party commences court proceedings despite an arbitration agreement, the other party may apply for a stay, which courts are to grant unless they find the agreement to be null, void, inoperative or incapable of being performed. However, the agreement becomes unenforceable where the party seeking to commence arbitration had instituted an action on the subject.

Validity of the Arbitration Clause Despite Invalidity of the Main Contract

In Nigeria, an arbitration clause may still be considered valid even if the rest of the contract is alleged to be invalid. This is because Section 14(2) of the AMA provides that the arbitration agreement is treated as distinct and autonomous from the underlying contract in which it is contained. Nigerian courts have consistently upheld the principle of separability to the effect that the invalidity, illegality, or non‑existence of the main contract does not, by itself, affect the validity of the arbitration clause.

Limits on Party Autonomy in the Appointment of Arbitrators

Nigerian law recognises and strongly protects the principle of party autonomy in choosing arbitrators. Under the AMA, parties are generally free to determine the number of arbitrators, the procedure for their appointment, and the qualifications they must possess.

However, there are a few important limits designed to safeguard the integrity and fairness of the arbitration process:

• All arbitrators must be impartial and independent. If there are justifiable doubts about an arbitrator’s impartiality or independence, that arbitrator may be challenged under Section 7(5)(b) and 8(1) of the AMA.
• Arbitrators must have the legal capacity to act; accordingly, minors or persons declared of unsound mind cannot validly be appointed.
• If the parties fail to agree on the appointment procedure, the Act provides default mechanisms for the appointment through an appointing authority or the court under Section 7 of the AMA.

Default Procedure for Appointment of Arbitrators

Under Section 7 of the AMA, the following fallback mechanisms apply if the parties’ chosen method for the appointment of arbitrator(s) fails:

• Where the arbitration is to be decided by three arbitrators, and the parties fail to appoint one arbitrator each (or the two appointed arbitrators fail to appoint the third), a party may request the court or designated appointing authority to make the necessary appointment.
• Where the arbitration is to be decided by a sole arbitrator, and the parties cannot agree on that person, either party may similarly apply to the court or appointing authority to step in.
• If multiple claimants and/or multiple respondents cannot jointly appoint their co‑arbitrators, any party may request the court or appointing authority to appoint all three members of the tribunal.

Judicial Intervention in the Selection of Arbitrators

Under the AMA, courts (or designated appointing authorities) can intervene in the selection of arbitrators, but only in clearly defined and limited circumstances such as where:

• parties fail to agree on a sole arbitrator;
• each party fails to appoint its arbitrator within the agreed time;
• the two party‑appointed arbitrators fail to appoint the presiding arbitrator; or
• in multiparty arbitrations, if the parties fail to jointly appoint arbitrators.

Nigerian courts have no power to choose arbitrators if the parties’ agreed appointment procedure is working, or to review the merits of an appointment decision made according to that procedure. The courts’ power is strictly procedural and supportive: it ensures that arbitration can proceed where the parties’ own mechanism has failed.

Challenge and Removal of Arbitrators in Nigeria

The AMA under Sections 8-10 contains specific provisions on the challenge and removal of arbitrators, aligning with international practice under the UNCITRAL Model Law. These grounds include justifiable doubts about impartiality or independence; failure to possess agreed qualifications; or incapacity or failure to act.

Procedure for Challenge

A party must raise the challenge within 14 days of becoming aware of the circumstances giving rise to it. The tribunal decides the challenge initially. If rejected, the challenging party may apply to the High Court or an agreed appointing authority for a final decision. However, any challenge for failure or impossibility to act may be presented at any time. However, any challenge against an emergency arbitrator must be presented within three days of the party becoming aware of the circumstance giving rise to the challenge. Please see Section 17 of the AMA.

Requirements of Independence, Impartiality and Disclosure

Arbitrators in Nigeria must be independent and impartial. They are required to disclose any circumstances likely to give rise to justifiable doubts as to their impartiality or independence (Sections 7(5(b) and 8(1) of the AMA). The disclosure must be made without delay, ensuring transparency so the parties can consider whether to challenge the arbitrator’s appointment. This duty applies both before acceptance of appointment and throughout the proceedings if new circumstances arise. The principal arbitration institutions used in Nigeria incorporate similar standards.

Tribunal’s Power to Rule on Its Own Jurisdiction

The principle of competence‑competence is expressly recognised and applied under Section 14 of the AMA as it grants an arbitral tribunal the power to rule on its own jurisdiction, including objections with respect to the existence or validity of the arbitration agreement; and whether the tribunal is properly constituted or empowered to decide the dispute.

Circumstances Where Courts May Address Jurisdiction

Courts may address the jurisdiction of an arbitral tribunal in three key scenarios:

• At the Preliminary Stage: Where a party applies for a stay of court proceedings on the ground that the dispute should be referred to arbitration, the court must decide prima facie whether a valid arbitration agreement exists.
• After a Tribunal’s Positive Ruling on Jurisdiction: If a tribunal rules under Section 14(6) of the AMA that it has jurisdiction, an aggrieved party may apply to the court (usually within 30 days) to contest that ruling.
• At the Setting‑Aside or Enforcement Stage: After an award has been made, the court may, under Section 55(3) and 58(2) of the AMA, consider whether the tribunal had jurisdiction when asked to set aside or refuse enforcement of the award.

Nigerian courts generally defer to the arbitral process and encourage parties to raise jurisdictional objections first before the tribunal (reflecting the competence‑competence principle). If the tribunal rules that it does not have jurisdiction (a negative jurisdictional ruling), Nigerian courts can review this. Under the AMA, a party dissatisfied with a negative ruling may apply to the court for a determination, and the court can overturn the tribunal’s finding if appropriate.

Timing for Challenge Before the Court

Parties have structured opportunities to ask the court to review an arbitral tribunal’s jurisdiction. These opportunities arise at different stages:

• Before the Tribunal is Constituted: A party sued in court despite an arbitration agreement may apply for a stay of proceedings and referral to arbitration. The court then assesses prima facie whether a valid arbitration agreement exists.
• After the Tribunal is Constituted and Makes a Positive Jurisdiction Ruling: If the arbitral tribunal decides it has jurisdiction (usually raised as a preliminary issue under the competence‑competence principle), an aggrieved party may apply to the court (generally within 30 days) to challenge this ruling. This is the most common formal route to test jurisdiction in court during the proceedings.
• After an Award is Rendered: A party may also challenge the tribunal’s jurisdiction indirectly by seeking to set aside the award or resist its recognition and enforcement on the ground that the tribunal lacked jurisdiction.

Questions of Jurisdiction

When a Nigerian court is invited to review a tribunal’s positive ruling on its own jurisdiction (under Section 14(3) and (7) of the AMA), the review is generally conducted de novo. The court will not simply defer to the tribunal’s decision; it will independently examine whether the arbitration agreement is valid, covers the dispute, and binds the parties. This approach is consistent with international practice under the UNCITRAL Model Law, on which the AMA is largely based. At the enforcement or set-aside stage, courts also apply a full merits (de novo) review of jurisdiction if it is raised as a ground to set aside or refuse enforcement of an award.

Questions of Admissibility

In contrast, questions that go to the admissibility of a claim (rather than the tribunal’s jurisdiction to hear it at all) are generally treated as falling within the tribunal’s exclusive domain. Nigerian courts have shown reluctance to interfere with procedural decisions or questions of timing, waiver, or compliance with pre-conditions, seeing these as matters of admissibility, not jurisdiction. In practice, courts adopt a more deferential approach to such matters, declining to revisit the tribunal’s conclusions except in cases of clear excess of mandate or misconduct.

Pro Arbitration Judicial Approach

Nigerian courts adopt a pro‑arbitration stance toward parties who commence court proceedings despite having agreed to arbitrate. This is reinforced by the AMA which largely follows the UNCITRAL Model Law.

When a dispute comes before a court in breach of an arbitration agreement, the usual approach is for the defendant to promptly apply for a stay of proceedings and request referral to arbitration. Provided the arbitration agreement is valid, operative, and capable of being performed, courts generally compel arbitration and stay their own proceedings.

Reluctance to Entertain Parallel Litigation

The courts recognise that permitting litigation to proceed would undermine party autonomy and the effectiveness of the arbitration process; as a result, they are generally reluctant to allow parallel proceedings to continue.

Exceptions and Procedural Discipline

However, courts do expect the party relying on the arbitration agreement to act promptly as delay, waiver or conduct inconsistent with an intention to arbitrate can lead courts to refuse a stay. In practice, courts scrutinise the timing and conduct of the party seeking to enforce the arbitration agreement to ensure it has not participated substantially in the court action before seeking the stay.

Limited Circumstances Under Nigerian Law

An arbitral tribunal generally lacks jurisdiction over individuals or entities that are not signatories to the arbitration agreement. However, Nigerian courts and tribunals may extend the effect of an arbitration agreement to non‑signatories where a non‑signatory so completely controls a signatory that it is appropriate to disregard the separate legal personality; a party has expressly or impliedly authorised another to enter into the arbitration agreement on its behalf; a non‑signatory subsequently assumes obligations under the contract containing the arbitration clause or where a non‑signatory has conducted itself in a manner that makes it inequitable to deny being bound, such as actively participating in the arbitration.

Application to Foreign and Domestic Third Parties

These principles apply equally to foreign and domestic parties. However, while tribunals seated in Nigeria may address jurisdictional objections and rule on their own jurisdiction under the principle of competence-competence, the question of binding non-signatories often ultimately depends on later judicial review – particularly if enforcement of an award against the non-signatory is sought.

Tribunal’s Power to Award Interim Reliefs and Types of Interim Measures Available

An arbitral tribunal is expressly empowered to grant interim measures of protection. Such interim measures are binding rather than merely advisory. Once granted, they have the same effect as an order of the tribunal and may be recognised and enforced by the courts, unless the court decides otherwise on limited grounds set out in the AMA. The tribunal may order a wide range of interim relief, including but not limited to preservation of assets that might later be used to satisfy an award and maintenance or restoration of the status quo pending determination of the dispute. Please see Section 20 of the AMA.

Court-Ordered Interim Measures in Support of Arbitration

Nigerian courts do play an important complementary role in granting preliminary or interim relief in arbitral proceedings. The courts may grant a broad range of interim relief in relation to domestic or foreign seated arbitration, including:

• orders preserving the subject matter of the dispute;
• orders securing assets or property that could be used to satisfy an eventual award; and
• orders to maintain or restore the status quo or to preserve evidence.

Emergency Arbitrators Under Nigerian Law

The AMA expressly recognises and permits the appointment of emergency arbitrators under the rules of arbitral institutions that provide for such procedures. Decisions or orders of an emergency arbitrator under Nigerian law are binding on the parties, in the same way as interim measures issued by a regular tribunal. The emergency arbitrator may grant relief aimed at preventing irreparable harm, preserving the status quo, protecting assets or evidence relevant to the arbitration.

Limits on Court Intervention Once an Emergency Arbitrator is Appointed

Once an emergency arbitrator has been appointed, the national courts generally cannot intervene to revisit or overturn the emergency arbitrator’s decision on the merits of the relief granted. However, courts may still exercise jurisdiction to enforce the emergency arbitrator’s order, or to address specific issues outside the scope of the arbitrator’s powers.

Power of Arbitral Tribunals to Order Security for Costs

The law expressly empowers arbitral tribunals to order a party to provide security for costs. Under the AMA, a tribunal may, upon application by a party, issue an order requiring another party to furnish security to cover potential costs of the arbitration. Tribunals typically consider factors such as the apparent merits of the claim or defence; the financial standing of the party against whom the order is sought; and whether the application is being used tactically to obstruct the proceedings.

Role of the Courts

While the arbitral tribunal is the primary decision‑maker on security for costs, the courts also have supporting powers. Before the tribunal is constituted, a party may apply to the court for interim relief, which may include an order for security for costs if circumstances justify urgent judicial intervention. Once the tribunal is in place, the courts usually defer to the tribunal’s competence to handle such applications, reflecting Nigeria’s policy of judicial non‑interference in matters within the tribunal’s jurisdiction.

National Legislation

The AMA regulates matters such as composition of the tribunal; conduct of proceedings; powers of the tribunal (including interim measures and emergency arbitrators); recognition and enforcement of awards; and setting aside and challenging awards.

Party Autonomy, Institutional Rules and Institutional Guidance

Beyond the national legislation, parties enjoy broad autonomy to determine procedural rules. Frequently, parties choose to incorporate into their arbitration agreements the rules of established arbitral institutions. In practice, many arbitrations seated in Nigeria follow institutional rules to promote procedural predictability, efficiency, and neutrality. However, ad hoc arbitrations are still common, especially where parties prefer to avoid administrative costs associated with institutions.

Procedural Steps Required by Law in Nigerian-Seated Arbitrations

The AMA requires certain minimum procedural steps (which are determined depending on the nature, complexity and context of each dispute) to safeguard fairness and due process such as:

• Proceedings start when the claimant serves a written notice stating the claim, relief sought, and arbitration agreement.
• The arbitral tribunal is constituted, either in accordance with the parties’ agreement or, failing that, by the court or a designated appointing authority.
• Both parties must have a full and equal chance to present their case, and this right cannot be waived.
• The tribunal sets deadlines for detailed submissions of facts, arguments, and evidence by both sides.
• Arbitrators are appointed following the parties’ agreement or default rules under the AMA.
• Arbitrators must disclose any circumstances raising doubts about their impartiality or independence.
• Parties may proceed based on documents alone but can request an oral hearing.
• The tribunal formally closes proceedings before issuing the award within the required timeframe.

Powers and Duties of Arbitrators under Nigerian Law

Arbitrators have a fundamental duty to remain impartial and independent throughout the proceedings. They are required to disclose any circumstances that could give rise to justifiable doubts about their impartiality or independence. This duty is complemented by the obligation to treat the parties fairly and equally, ensuring that each party has a full opportunity to present its case. Additionally, arbitrators must conduct the arbitration efficiently, avoiding unnecessary delay or expense, and maintain confidentiality over all matters related to the proceedings, unless the parties agree otherwise.

In terms of powers, the AMA grants arbitrators significant authority to manage the proceedings. This includes determining procedural rules, setting timelines, deciding on the admissibility and weight of evidence, and choosing whether to conduct oral hearings or resolve the dispute on written submissions alone. Arbitrators also have the power to issue interim measures, which can include orders to preserve assets or protect evidence, ensuring that the arbitration remains effective.

Representation in Arbitration: Qualifications and Requirements

In contrast, in domestic litigation before Nigerian courts, strict requirements apply: legal representation must be by lawyers called to the Nigerian Bar and enrolled to practise. However, these restrictions do not extend to arbitration.

Under the AMA, there are no mandatory requirements that restrict representation solely to lawyers qualified to practise in Nigeria. As a result, parties to an arbitration seated in Nigeria may choose representatives who are not locally qualified. This means foreign-qualified lawyers or technical experts may appear as counsel or representatives, provided the parties agree.

In Nigeria, arbitration practice reflects a balance between flexibility and procedural structure when it comes to collecting and submitting evidence, both at the pleading stage and during hearings.

Pleadings and Document Disclosure

At the outset, parties typically exchange statements of claim and defence accompanied by supporting documents. Nigerian arbitration does not follow the broad, court-like discovery process common in some jurisdictions. Instead, it relies on a disclosure model shaped by party agreement or institutional rules, with parties often submitting only those documents they intend to rely on or that are requested by the tribunal upon a reasoned application by the opposing side.

Use of Witness Statements and Cross-Examination

It is common practice for evidence-in-chief to be presented in writing through detailed witness statements filed with pleadings or shortly afterwards. During the oral hearing, these witnesses may be subject to cross-examination and, if necessary, re-examination.

Expert Evidence

Expert evidence may also be presented through written reports, and experts may be cross-examined at the hearing. Parties sometimes appoint their own experts, or the tribunal may appoint an independent expert if the issues require it.

Privilege and Admissibility

Under Nigerian arbitration practice, the principle that evidence which would be privileged before the courts remains privileged in arbitration is generally upheld. The tribunal has discretion to determine the admissibility, relevance, materiality and weight of any evidence.

Rules of Evidence in Nigerian-Seated Arbitral Proceedings

Arbitral proceedings seated in Nigeria are not strictly bound by the formal rules of evidence that apply in Nigerian courts, such as those found in the Evidence Act, 2011. Instead, the AMA grants arbitral tribunals the discretion to determine the admissibility, relevance, materiality and weight of evidence. While tribunals and parties sometimes draw guidance from the Evidence Act for persuasive value, they typically apply rules consistent with the chosen rules of procedure in line with arbitration practice and international standards.

Court Assistance and Powers of Compulsion in Nigerian-Seated Arbitrations

Arbitral tribunals do not have inherent powers of compulsion to force parties or non-parties to produce documents or attend hearings. Instead, the AMA provides tribunals with the ability to seek assistance from the courts where necessary for the issuance of summons for witnesses to attend and give evidence or compel the production of documents or other evidence relevant to the arbitration. Please see Section 43 of the AMA.

This assistance applies differently to parties and non-parties. Parties who have agreed to arbitrate are generally expected to comply voluntarily with the tribunal’s directions as part of their contractual commitment. By contrast, non-parties are not bound by the arbitration agreement, so tribunals must rely on the courts to compel their co-operation.

Confidentiality in Nigerian-Seated Arbitration

Arbitral proceedings seated in Nigeria are generally regarded as confidential, reflecting a widely accepted feature of arbitration as a private method of dispute resolution. The AMA reinforces this principle by expressly providing that the proceedings themselves – including pleadings, evidence and the final award – should remain confidential unless the parties agree otherwise.

However, confidentiality is not absolute. Nigerian law and practice recognise certain situations where disclosure may be necessary or permitted such as where disclosure is required to protect or enforce a party’s legal right (such as in setting-aside or enforcement proceedings before a court).

In practice, Nigerian courts have also acknowledged that once parties bring aspects of the arbitration into the public domain – such as by seeking enforcement of an award – the related documents and proceedings may become part of the court record, potentially limiting confidentiality to that extent.

Legal Requirements and Timing of Arbitral Awards in Nigeria

Per Section 47 of the AMA, an arbitral award must be in writing and signed by the arbitrator or all members of the arbitral tribunal. Where the tribunal comprises more than one arbitrator, the signatures of the majority suffice, provided that the reason for any omitted signature is explained.

The award must also state the reasons on which it is based, unless the parties have agreed otherwise or the award is made by consent of the parties (a settlement award). In addition, it must specify the date of the award and the place of arbitration, which is deemed to be the place agreed by the parties or determined by the tribunal under the AMA.

Regarding timing, the AMA generally requires that an award be made within 90 days of the date on which the parties or tribunal have declared proceedings closed, unless the parties agree to extend this period or the tribunal itself, for justifiable reasons, extends the time.

Limits on Remedies That May Be Awarded by an Arbitral Tribunal in Nigeria

Arbitral tribunals have broad powers to grant remedies that reflect the substantive rights of the parties, provided the relief sought is within the scope of the parties’ arbitration agreement and does not infringe statutory or constitutional rights. These include monetary damages, declaratory relief, injunctions, orders for specific performance, and rectification of contracts. However, there are important limits shaped by public policy and the nature of arbitration as a consensual process.

Tribunals generally cannot award punitive or exemplary damages, as these are seen to go beyond compensatory justice and into the realm of punishment, which remains the preserve of national courts. Similarly, tribunals are not permitted to award remedies that would contravene Nigerian public policy or mandatory provisions of Nigerian law, such as criminal sanctions or penalties.

Recovery of Interest and Legal Costs in Nigerian Arbitration

Parties to arbitration seated in Nigeria are generally entitled to claim interest on sums awarded, both for the period prior to the commencement of arbitration (pre-award interest) and for the period after the award is made until payment (post-award interest). Under the AMA, the arbitral tribunal has the discretion to award such interest at a rate it considers reasonable, unless the parties have agreed otherwise in their contract.

Regarding legal costs, the prevailing practice aligns with the principle of “costs follow the event”, hence the successful party is typically entitled to recover reasonable costs, including arbitration costs, tribunal fees, and legal representation expenses, unless the tribunal finds it equitable to order otherwise. The tribunal may also take into account factors such as the parties’ conduct, the complexity of the issues, or whether a party acted unreasonably in the course of proceedings.

Recourse Against Arbitral Awards in Nigeria: Setting Aside Rather Than Appeal

Under Nigerian law, particularly at Section 55(3) of the AMA, there is no right of appeal from an arbitral award in the traditional sense of appellate litigation. Instead, the AMA provides limited grounds on which a party may apply to set aside an award before the court of the place where the award was made, such as where a party to the arbitration agreement was under some incapacity; the arbitration agreement is not valid under the law to which the parties have subjected it; or the award is in conflict with Nigeria’s public policy.

Procedure for Applications to Set Aside Award

Applications to set aside must generally be made within three months from the date the party received the award. Courts typically take a restrictive approach, intervening only where the specified statutory grounds are clearly met.

The AMA introduces two new features that create additional, party-driven options. First, parties to a domestic arbitration may agree that an award can be appealed to the court on a question of Nigerian law. This right of appeal, however, is strictly limited to legal questions and depends entirely on party agreement. Second, the AMA establishes the option of an Arbitral Review Tribunal (a fresh arbitral tribunal that can reconsider an award before any recourse to court). This mechanism only applies if the parties expressly opt into it in their arbitration agreement or in writing.

Party Autonomy and the Scope of Challenge to Arbitral Awards in Nigeria

The principle of party autonomy is fundamental and widely respected. However, when it comes to excluding or expanding the statutory grounds for setting aside an arbitral award, the law draws a clear boundary. Parties cannot contractually expand the scope of appeal or challenge beyond what is provided in the AMA. Conversely, parties can agree to exclude certain challenges or restrict their right to seek to set aside an award, provided such an agreement itself does not violate mandatory provisions of the Act or public policy.

Separately, the new Arbitral Review Tribunal under the AMA provides an internal mechanism for reviewing awards within the arbitral process itself. Parties can opt into this by express agreement, thereby expanding the opportunities for correcting errors before an award becomes final.

Standard of Judicial Review of the Merits of a Case

Under Nigerian law, courts generally adopt a deferential approach to the merits of an arbitral award. Judicial review is not an opportunity for the courts to reassess the facts, evidence or substantive reasoning of the tribunal. Instead, courts focus strictly on the statutory grounds for setting aside or refusing recognition and enforcement of an award, as provided under the AMA.

The courts will not conduct a de novo review of the dispute or substitute their own assessment of the merits for that of the tribunal. Even where an application is brought to set aside an award or resist enforcement, the review remains limited to issues such as procedural irregularity, excess of jurisdiction, breach of natural justice or matters of public policy.

Nigeria’s Ratification of the New York Convention

Nigeria is a signatory to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, having ratified it on 17 March 1970. The country applies the Convention on the basis of two standard reservations:

• Reciprocity Reservation: The Convention applies only to awards made in other contracting states.
• Commercial Reservation: The Convention is limited to disputes arising out of legal relationships, whether contractual or not, that are considered commercial under Nigerian law.

In addition to the New York Convention, Nigeria is also a party to the 1965 ICSID Convention, which governs the settlement of investment disputes between states and nationals of other states.

Procedures and Standards for Enforcement of Awards

The enforcement of arbitral awards depends on whether the award is foreign or domestic.

• Domestic awards are typically enforced by applying to the High Court for enforcement as a judgment of the court. This is done under the AMA or, in some instances, under the older Arbitration and Conciliation Act if applicable by transitional provisions.
• Foreign awards are generally enforced under the 1958 New York Convention, which has been incorporated into Nigerian law through the AMA. The applicant must produce the original award or a duly certified copy, along with the original arbitration agreement or a certified copy.

Awards Set Aside at the Seat of Arbitration/Awards Subject to Ongoing Set-Aside Proceedings at the Seat

Nigerian courts tend to respect annulment decisions made by the courts at the seat of arbitration. If an award has been set aside at the seat, Nigerian courts are generally unlikely to enforce it. Where set-aside proceedings are ongoing in the courts of the seat, Nigerian courts may stay or suspend enforcement proceedings pending the conclusion of those proceedings. The AMA gives the court discretion to adjourn its decision on enforcement and may, on the application of the enforcing party, order the opposing party to provide security.

Sovereign Immunity at the Enforcement Stage

State and state entities may raise the defence of sovereign immunity to resist enforcement. Nigerian courts recognise the doctrine of restrictive sovereign immunity, meaning that immunity does not generally apply to commercial activities. Thus, if the state entity has entered into an arbitration agreement relating to commercial transactions, Nigerian courts are likely to treat this as a waiver of immunity from jurisdiction and possibly also from execution, subject to the particular facts and applicable statutory provisions.

General Approach of the Courts

Nigerian courts are broadly supportive of arbitration and generally adopt a pro-enforcement stance towards both domestic and foreign arbitral awards. Courts typically focus on procedural fairness and the narrow statutory grounds set out in the Convention and the AMA, rather than reviewing the merits of the underlying dispute.

Refusal on Public Policy Grounds

Public policy remains one of the key grounds upon which Nigerian courts may refuse enforcement of an award, but this is interpreted narrowly. Courts distinguish between domestic public policy, which reflects fundamental principles and values of Nigerian law (for example, fraud, corruption, or manifest injustice in the arbitration process), and international public policy, which tends to be narrower and applies to the recognition of foreign awards.

Class and Group Arbitration in Nigeria

Nigerian arbitration law does not specifically provide for class action arbitration or group arbitration. The AMA and prior legislation focus on party autonomy and typically contemplate arbitration between clearly defined parties who have agreed to submit their disputes to arbitration.

In practice, this means that for claims to be heard together or on a representative basis, there must be a clear, express agreement by all affected parties. The absence of statutory provisions permitting or regulating class arbitration creates a significant limitation: arbitrators in Nigeria generally lack jurisdiction to conduct class or group proceedings unless the parties have specifically consented to such a mechanism in their arbitration agreement.

As a result, multiparty disputes are often managed by consolidating separate arbitrations or through joinder procedures where parties consent, rather than through formal class arbitration. This position aligns with the principle that arbitration remains a consensual process grounded in party agreement, which Nigerian law continues to uphold.

Ethical Standards for Counsel and Arbitrators in Nigeria

In Nigeria, counsel appearing in arbitral proceedings are primarily guided by the Rules of Professional Conduct for Legal Practitioners 2023, issued under the Legal Practitioners Act. These rules impose obligations relating to honesty, fairness, avoidance of conflicts of interest, and maintaining client confidentiality. For arbitrators, the AMA codifies key ethical duties, notably requirements of independence, impartiality, and disclosure of any circumstances likely to give rise to justifiable doubts about these qualities.

Additionally, many Nigerian practitioners and arbitrators draw guidance from international soft law instruments, such as the IBA Guidelines on Conflicts of Interest in International Arbitration and the IBA Guidelines on Party Representation. While not binding under Nigerian law, these guidelines are increasingly influential and reflect widely accepted best practice in international arbitration conducted in or seated in Nigeria.

Third-Party Funding in Nigeria: Emerging Rules and Restrictions

Third-party funding is expressly recognised and regulated under the AMA. The Act permits parties to enter into third-party funding arrangements for arbitration and related proceedings, reflecting a modern and pragmatic approach aligned with international practice.

Under the Act, parties are required to disclose the existence of any third-party funding arrangement and the identity of the funder to the other parties and to the arbitral tribunal. This disclosure must be made promptly upon concluding the funding arrangement or upon the party becoming aware of it.

Beyond this statutory disclosure obligation, the Act does not currently impose detailed substantive restrictions on third-party funders such as licensing requirements or limits on the types of cases that may be funded. However, the legal and arbitral community continues to monitor how these rules operate in practice, particularly regarding potential conflicts of interest and transparency in proceedings.

Consolidation of Arbitral Proceedings in Nigeria

Arbitral tribunals seated in Nigeria and, in certain circumstances, Nigerian courts may order the consolidation of separate arbitral proceedings.

Consolidation may be ordered where:

• the parties have agreed to it; or
• the claims arise under the same arbitration agreement or compatible agreements, and the tribunal or court finds it appropriate to consolidate to promote efficiency and consistency.

Binding Third Parties to Arbitration in Nigeria

Under the AMA, arbitration is fundamentally based on party consent. However, in limited circumstances, third parties who were not original signatories to an arbitration agreement may nonetheless be bound.

National Courts and Foreign Third Parties

Nigerian courts may recognise these doctrines when deciding if a foreign third party should be joined to or bound by an arbitration agreement or award. However, the courts generally exercise caution and will only do so where the facts clearly establish legal grounds, in order to respect the principle of consent that underpins arbitration.