Mrs Shola Oshodi-John is the Registrar/CEO, Nigerian Chartered Institute of Arbitrators, NICArb. In this interview, she speaks on current civil unrest in the country and how ADR can play a significant role in tackling the challenge. She also speaks about NICArb’s forthcoming virtual annual conference and why this year’s event is unique. Excerpt
By Henry Ojelu
How would you rate the acceptance of arbitration so far in Nigeria as an alternative dispute resolution mechanism?
There is a growing acceptance of arbitration in Nigeria. Financial (and commercial) institutions have historically been sceptical about arbitration as an effective dispute resolution mechanism in the commercial context. As a result, the various agreement and documentations used in commercial financial transactions have generally or by default required that disputes be submitted to the courts of a particular jurisdiction.
In recent years, however, these institutions have shown an increased interest in considering the relative merits of arbitration for certain complex international and national financial transactions. The result is that a number of initiatives have developed in response to new thinking. However, in Government transactions, the nature of international transaction and treaties requires arbitration as a ready alternative to litigation.
Some stakeholders have advocated for a national policy on arbitration. How relevant is this suggestion?
Yes, a national policy on arbitration is significant from both an economic and judicial standpoint. This is premised upon the position that arbitration agreements in respect of all disputes arising from contractual relationships in Nigeria should have Nigeria as the seat of arbitration. We can start from implementing the Local Content Act in full, as dispute resolution (arbitration and ADR) are also service offerings, therefore the same principles should apply.
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This is significant because Nigeria generates a significant volume of commercial transactions, both domestic and international with about 80 percent of these transactions originating and or terminating in Nigeria especially Lagos, Port Harcourt, Kano, Abuja. Unfortunately, disputes arising from these transactions that are basically Nigerian and can be termed ‘domestic’ are ultimately arbitrated in foreign countries.
This translates to a loss of revenue in billions of dollars to the majority of arbitrators (and service providers in both arbitration and hospitality sector), including tax revenue to the government. It is also a source of huge capital flight from Nigeria in the form of arbitration fees and other related charges. This and many more areas are what a national arbitration policy can address.
In your experience, what are the challenges currently hampering arbitration practices in Nigeria?
The challenges can be divided into two Ps; Policy and People. The Policy (and legal) framework for arbitration in Nigeria need to be re-visited carefully. For example, there is a need for new local legislation that speaks to the needs of global demand and expectations. There is also a need for the Presidency to take the development of a National Arbitration Policy serious.
This is considering the enormous potential of arbitration in the economy. Furthermore, as part of the policy efforts to tackle the challenges to arbitration in Nigeria, there is an urgent need to revisit and renegotiate the many treaties signed by the Federal Government which hamper the growth of arbitration in Nigeria.
As to the people, the challenges with the widespread adoption of arbitration (and other forms of ADR) in Nigeria is still evident especially among implementers of government policy, judicial officers and legal practitioners.
Some of their attitudes may be viewed as calculated attempts to evade or frustrate the use of arbitration and ADR in dispute resolution. Sometimes it portrays ignorance or poor knowledge about the ethos and nuances of Arbitration and ADR to litigation in the practice of law.
Nigeria is currently in crisis over years of injustice and human rights abuses. Can arbitration play any role in solving some of these perceived wrongs?
The concept of arbitration as a method for dispute resolution in human right cases is growing, and there is a strong argument for it. Arbitration can play a significant role in human rights disputes, considering the speed at which justice is dispensed, as well as the opportunity to leverage the expertise of professionals, unlike in the traditional litigation process.
There is a growing concern on the impacts of business activities on human rights from the economy, environment and governance standpoint. This led to the launch of United Nations Guiding Principles, a set of guidelines endorsed by the UN Human Rights Council in 2011 and thereafter the Hague Rules on Business and Human Rights Arbitration (BHR arbitration) in 2019, called the Hague Rules.
The Hague Rules can play a significant role in addressing perceived human right abuses that are traceable to business activities of both state and non-state actors. However, it is germane to state that business activities that border on human rights dispute can only be resolved by arbitration if the parties involved consent to arbitration. Therefore, consent remains the cornerstone of commercial and human rights arbitration, including all facet of arbitration.
NICArb virtual Annual Conference is scheduled for next month. What necessitated your choice of theme, ‘Making Arbitration and ADR work for Africa’?
The theme of this year’s Annual Conference is borne out of the need to discuss the policies militating the practice of arbitration in Africa and Nigeria in particular, increase collaboration in terms of policy, people, and programmes in the arbitration community. This is largely because the practice and application of arbitration in Africa has increased in the last decade.
In addition, the African arbitration landscape is seeing an increasing number of arbitral professionals who play significant roles in the global arbitration community; as well there is an increasing number of arbitral centres and institutes such as NICArb.
More so the recent signing of the African Continent Free Trade Agreement by African Countries including Nigeria necessitated the urgent need to come up with some form of a working document that can come up with a framework for dispute resolution. Going through the Agreement, this area has not been fully catered for and it is imperative that effective dispute resolution mechanisms and structure are put in place in many African countries before the full take-off of AfCTA otherwise this may become a clog in its successful implementation.
Therefore, with all these positive indicators, NICArb (the first arbitration institution in sub-Saharan Africa) is convinced this is the right time to take a leading role in driving collaboration across arbitral institutions and professionals, as well as drive policies that will help position Africa in the global arbitration community.
Share more insight on the programme and what participants should expect.
The Conference which is to hold from November 18 to November 20 of this year will have in attendance the best of the best arbitral (and ADR) professionals and speakers from literally every continent in the world and from institutions such as the World Bank, the United Nations, as well as continental institutions such as APAA (Association for the Promotion of Arbitration in Africa, Arbitral Women, (ITA) Institute of Transnational Arbitration (OHADA) Harmonisation of Business Law in Africa etc.
This year’s conference will hold virtually and we are partnering with the Arbitration Place Canada to deliver the best experience possible. We have also made efforts to ensure it is free, but registration is required.
The topics to be covered will range from conversations about alternative dispute resolution as a process, AfCFTA, technology and innovation, Investment treaties, the Singaporean Convention on Mediation, to renewable energy and the environment, opportunities for growth of arbitration and ADR in Africa and many others.