AN APPRAISAL OF THE NIGERIAN NATIONAL POLICY ON ARBITRATION AND ALTERNATIVE DISPUTE RESOLUTION

AN APPRAISAL OF THE NIGERIAN NATIONAL POLICY ON ARBITRATION AND ALTERNATIVE DISPUTE RESOLUTION

In February 2025, the Federal Ministry of Justice unveiled the Nigerian Policy on Arbitration and ADR for the period of 2024-2028. The policy marks a major advancement in strengthening Nigeria's legal framework, with the goal of establishing the country as a leading centre for arbitration and alternative dispute resolution (ADR) across Africa (Art 2 &3).

The policy aims to harmonize Nigeria's dispute resolution systems with global standards like the UNCITRAL Model Law, New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, amongst others, thereby creating a favourable climate for both local and international business activities. In addition, the policy also aims to encourage the use of arbitration and other alternative dispute resolution to resolve commercial disputes in order to decongest the courts. Further, it aims to promote the use of arbitration among Federal Government Ministries, Departments and Agencies (FG MDAs), hence it contains guidelines for their participation in arbitration and recommends the inclusion of arbitration clauses in agreements involving state government ministries, departments and Agencies (SG MDAs).

 The policy also emphasizes the need for capacity building by promoting training and education in arbitration and ADR, thereby improving the expertise of professionals and relevant stakeholders. (Art. 18) By creating a reliable and efficient dispute resolution framework, that prioritises the hallmarks of arbitration; transparency, fairness and efficiency, the policy seeks to boost investor confidence and stimulate economic development.

Key features of the policy include;

The appointment of arbitrator(s) in disputes involving claims exceeding 50 million must be confirmed by the Attorney General of the Federation or the Attorney General of the state involved in the dispute. This measure aims to ensure supervision and consistency in arbitral practices. (Art. 6)

In line with its capacity building measure, the policy also advocates for the engagement of Nigerian counsel in arbitration cases, particularly in disputes involving government entities. In circumstances where a foreign counsel is engaged, the policy encourages collaboration with Nigerian lawyers to facilitate capacity building and knowledge transfer. (Art. 7)

The policy encourages users and stakeholders to choose Nigeria as a seat and venue for arbitral proceedings, thereby boosting Nigeria as an arbitration hub. (Art 13)

These key provisions have significant implications for businesses, stakeholders, investors, the government and all its entities. For the legal community, law students, lawyers and arbitrators would benefit from more training, increased legal representation and more appointments. Investors and businesses will enjoy a robust and reliable dispute resolution system that guarantees experienced and neutral tribunals which would enhance ease of doing business, attract foreign investment and foster economic growth. The Ministries, Departments and Agencies are provided with a framework for engaging arbitration promoting consistency and efficiency in handling disputes

The policy articulates a comprehensive framework to build a global standard of arbitral practice in Nigeria but its success hinges on effective implementation. Although the policy has commendable objectives, it lacks a proper mechanism of implementation. The policy requires structured plan for implementation which will outline responsibilities and coordinated execution strategies. The same applies to raising public awareness about the policy, Art. 18 emphasises the importance of developing capacity and infrastructure required for arbitration; however, it goes on to state that government will collaborate with private sector stakeholders to create awareness. This also appears to lack a defined strategy.

In conclusion, Nigeria's National Policy on Arbitration and ADR (2024–2028) represents a great initiative to modernize the country's dispute resolution landscape. By aiming to align with international standards, promoting capacity building, and encouraging the use of arbitration, as well as making the country a seat and venue for arbitration, the policy aims to enhance legal efficiency and economic development. Successful implementation will depend on the proper strategy, collaborative efforts of government entities, law firms, legal professionals, and stakeholders to realize the policy's objectives.