.Contracting and Negotiation Services in Nigeria, Out-of-Court Settlement

By Innocent Anaba, ABUJA

A Federal High Court sitting in Abuja has dismissed a suit seeking to nullify Section 257(2) and (3) of the Petroleum Industry Act (PIA) 2021.

Trial judge, Justice Taiwo Taiwo, held that there was no inconsistency in Section 257(2) and (3) of the PIA and Section 36(1) and (2) of the 1999 Constitution (as amended), as contended by the plaintiffs.

The section concerns whether payments made by a settlor under Section 240(2) of the PIA are deductible for hydrocarbon tax and companies income tax and under what conditions a host oil community will lose its financial entitlements.

Plaintiffs in the suit were George Timinimi, Chief Boro Dose and Philemon Ugedi.

The plaintiffs sued for themselves and on behalf of the entire members of the Gbaramatu-Egbema and Ogulagha Coastal Communities Front, GEOCCE, of Delta State.

The first and second defendants are the Attorney-General of the Federation and the National Assembly.

The plaintiffs in the suit had asked the court to declare that S.257(2) and (3) of the PIA are under Section 36 (1) and (2) of the Constitution, unconstitutional, null and void and of no effect whatsoever among other reliefs.

In his judgment, Justice Taiwo said: “The right of the plaintiffs to challenge any act under section 257(2) and (3) has not been extinguished. The Act has not taken away the rights of the plaintiffs to approach the court if it thinks that the decision to deduct any percentage from what is due to the host community has not been well thought out. The provisions of Section 257(2) and (3) are very clear and unambiguous.

“I, therefore, see no inconsistency in Section 257 (2) and (3) of the PIA and section 36(1) and (2) of the Constitution of the Federal Republic of Nigeria.

“The suit ought to be dismissed. Same is accordingly dismissed. This is the judgment of the court.”

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