Nigeria

Adeola Oyinlade & Co is delighted to announce that it has been recognized as a Tier 1 law firm in Nigeria for the 2025 edition of the Lawyers Global 2025 Annual Legal Awards. The law firm retains the number one position as the Nigerian Law Firm of the Year 2025 after ranking first (1st) in the 2024 edition of the Annual Awards released by the Lawyers Global in Lisbon, Portugal. Adeola Oyinlade & Co. is a market-leading law firm with a strong reputation in corporate and commercial law, particularly in areas like corporate advisory, banking, finance, intellectual property, tax, dispute resolution and consistently ranked for its expertise in various practice areas. The latest ranking affirms the expertise, client satisfaction, and market presence of the lawyers at Adeola Oyinlade & Co and the firm’s commitment and reputation for, and an outstanding record of, carrying out critical, innovative and complex work to the highest standards of excellence. The Lawyers Global Annual Awards recognizes the best lawyers and law firms globally in over 95 countries across the world. Read here – Adeola Oyinlade & Co ranked Tier 1 firm, wins Nigerian Law Firm of the Year – The Lawyers Global Awards 2025  

1.0 INTRODUCTION As international trade and investment expand, disputes arising from cross-border commercial transactions are increasingly being resolved through arbitration rather than litigation. Arbitration offers parties a private, neutral, and often faster forum to resolve disputes. However, the value of arbitration lies not only in obtaining an award but in ensuring that the award can be enforced in the jurisdiction where the debtor’s assets are located. Nigeria, a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), has developed a robust legal framework for the recognition and enforcement of foreign arbitral awards. This framework is significantly enhanced by the Arbitration and Mediation Act, 2023, which repealed the Arbitration and Conciliation Act, Cap A18, Laws of the Federation of Nigeria 2004. This article provides a comprehensive overview of the meaning of arbitration and arbitral awards, Nigeria’s legal framework, procedural steps, defenses to enforcement and limitation issues. 2.0 WHAT IS ARBITRATION? Arbitration is a form of alternative dispute resolution (ADR) in which the parties to a dispute agree to submit their claims to a neutral third party (the arbitrator or arbitral tribunal) for a binding decision, rather than resorting to court litigation. Arbitration is usually governed by an agreement between the parties, known as an arbitration agreement, which stipulates the rules, seat, language, and procedure of the arbitration. 2.1 WHAT IS AN ARBITRAL AWARD? An arbitral award is the final and binding decision issued by an arbitral tribunal at the conclusion of the arbitration proceedings. The award resolves the substantive issues in dispute and may include orders for payment of money, specific performance, interest, and costs. Once issued, the award is enforceable under applicable national and international laws, similar to a court judgment. 3.0 LEGAL FRAMEWORK FOR ENFORCING FOREIGN ARBITRAL AWARDS IN NIGERIA The enforcement of foreign arbitral awards in Nigeria is governed by both international treaties and domestic legislation. 3.1 INTERNATIONAL FRAMEWORK Nigeria is a contracting state to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), having acceded to it in 1970. The Convention mandates the recognition and enforcement of arbitral awards made in other contracting states, subject to specific exceptions.[1] 3.2 DOMESTIC LEGISLATION The Arbitration and Mediation Act, 2023 (the “Act”) incorporates the provisions of the New York Convention into Nigerian law. The Act provides that the Convention applies to any award made in a country other than Nigeria, provided that: The country is a party to the New York Convention; and The differences arise out of a legal relationship, whether contractual or not, considered commercial under Nigerian law.[2] This incorporation ensures that foreign arbitral awards are recognized and enforceable in Nigeria, subject to the conditions stipulated in the Convention and the Act. 4.0 WHAT QUALIFIES AS A FOREIGN ARBITRAL AWARD IN NIGERIA? A foreign arbitral award refers to an award made outside Nigeria pursuant to a valid arbitration agreement. For such an award to be enforceable in Nigeria, the following criteria must be met:[3] The award must be final and binding on the parties. It must be made in a country that is a party to the New York Convention. The subject matter of the dispute must be commercial under Nigerian law. The arbitration agreement must be valid under the law to which the parties have subjected it. 5.0 HOW TO ENFORCE A FOREIGN ARBITRAL AWARD IN NIGERIA: STEP-BY-STEP GUIDE The enforcement process involves initiating legal proceedings in a Nigerian court. The following steps outline the procedure: 5.1 FILING THE APPLICATION An application for the recognition and enforcement of a foreign arbitral award is made on application in writing,[4] before the Federal High Court or a State High Court with appropriate jurisdiction. It may be made ex-parte or on notice.[5] The application must be accompanied by: The duly authenticated original award or a duly certified copy thereof; The original arbitration agreement or a duly certified copy thereof; and A certified English translation of the award and agreement, if they are not in English.[6] An affidavit verifying the authenticity of the documents and compliance with the conditions for enforcement.[7] A written address outlining the legal arguments in support of the application. 5.2 COURT PROCEEDINGS Upon filing, the court reviews the application to ensure compliance with the statutory requirements. If satisfied, the court may recognize and enforce the award as a judgment of the court. The respondent has the opportunity to oppose the application by raising any of the grounds for refusal stipulated in the Act. 5.3 INTERACTION WITH THE FOREIGN JUDGMENTS (RECIPROCAL ENFORCEMENT) ACT Where an arbitral award is made in a foreign territory to which the Foreign Judgments (Reciprocal Enforcement) Act applies, and it was rendered in accordance with the law of that place, the award may be enforced in Nigeria as if it were a foreign judgment.[8]The provisions of the Act will apply mutatis mutandis. 6.0 GROUNDS FOR REFUSING ENFORCEMENT OF A FOREIGN ARBITRAL AWARD IN NIGERIA While Nigerian courts generally favor the enforcement of foreign arbitral awards, the Act provides specific grounds upon which enforcement may be refused. These grounds, reflecting Article V of the New York Convention, are categorized as follows: 6.1 GROUNDS INVOKED BY THE RESPONDENT The court may refuse enforcement if the respondent proves that:[9] A party to the arbitration agreement was under some incapacity, or the agreement is not valid under the applicable law. The party was not given proper notice of the appointment of the arbitrator or the arbitral proceedings or was otherwise unable to present their case. The award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration. The composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or the law of the country where the arbitration took place. The award has not yet become binding on the parties or has been set aside or suspended by a competent authority in the country where it was made. 6.2 GROUNDS CONSIDERED BY THE COURT SUO MOTU The court may also refuse enforcement if it finds that:[10] The subject matter of the dispute is not capable of settlement by arbitration under Nigerian law. The recognition or enforcement of the award would be contrary to the public policy of Nigeria. 7.0 TIME LIMITS AND LIMITATION ISSUES IN ENFORCING FOREIGN ARBITRAL AWARDS IN NIGERIA The Act does not specify a limitation period for enforcing foreign arbitral awards. However, by virtue of the Arbitration and Mediation Act, the Limitation Act applies to arbitral proceedings as it does to judicial proceedings.[11] It is important to note that the period between the commencement of arbitration and the final award is excluded from the computation of the limitation period.[12] This provision ensures that parties are not penalized for delays inherent in the arbitration process. 8.0 CONCLUSION Nigeria’s legal framework, underpinned by the Arbitration and Mediation Act, 2023, provides a robust mechanism for the recognition and enforcement of foreign arbitral awards. By aligning domestic legislation with international standards, Nigeria reinforces its commitment to fostering an arbitration-friendly environment conducive to international commerce. Parties seeking to enforce foreign arbitral awards in Nigeria can be assured of a legal process that upholds the sanctity of arbitration agreements and the finality of arbitral awards, subject to the limited exceptions provided by law. Written by Adeola Austin Oyinlade and Felicia Ayeomoni for Adeola Oyinlade & Co Email: [email protected] Telephone Number: +234 803 826 7683 / +234 802 686 0247 _________ Ranked as a top law firm in Nigeria, Adeola Oyinlade & Co is known for its expertise in resolving disputes through arbitration, a form of alternative dispute resolution. The firm often handle complex, high-stakes cases across various industries and jurisdictions. With a strong track record in arbitration, deep knowledge of international arbitration rules and institutions, and the ability to manage cross-border disputes effectively, our services have earned us the Nigeria Law Firm of the Year Award at the Lawyers Global 2024 Annual Legal Awards and the prestigious International Law Firm of the Year in Nigeria of Corporate INTL Global Awards for the years 2022, 2023, 2024 and 2025 (4 years in a row) among others. [1] Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), 1958, Articles I–V. [2] Section 60 of the Arbitration and Mediation Act, 2023. [3] Ibid [4] Section 57 (1) of the Arbitration and Mediation Act, 2023. [5] Order 52 Rule 16 (1) of the Federal High Court Civil Procedure Rules, 2019. [6] Section 57 (2) of the Arbitration and Mediation Act, 2023. [7] Order 52 Rule 16 (2) of the Federal High Court Civil Procedure Rules, 2019. [8]  Order 52 Rule 17 of the Federal High Court Civil Procedure Rules, 2019 [9] Section 58 (2) (a) of the Arbitration and Mediation Act, 2023. [10] Section 58 (2) (b) of the Arbitration and Mediation Act, 2023. [11] Section 34 (1) of the Arbitration and Mediation Act, 2023. [12] Section 34 (4) of the Arbitration and Mediation Act, 2023

Introduction Nigeria remains a compelling destination for foreign direct investment in 2025. With its population of over 200 million, abundant natural resources, and a growing technology and services sector, the country offers significant business opportunities across industries—from fintech and logistics to manufacturing, infrastructure, and real estate. However, Nigeria’s regulatory and legal landscape is complex, multi-layered, and often misunderstood by newcomers. At The Trusted Advisors, we routinely guide international clients through the process of entering and operating within Nigeria’s business environment. This article outlines the legal considerations every foreign investor should understand before launching or expanding a business in Nigeria. Choosing the Right Business Structure The most common and suitable structure for foreign-owned businesses is the Private Company Limited by Shares (Ltd), which allows for 100% foreign ownership under Nigerian law. Other structures, such as partnerships or public limited companies, may apply in certain industries or for joint venture models. Setting up a private limited company involves registration with the Corporate Affairs Commission (CAC), followed by obtaining statutory documents such as: Certificate of Incorporation Memorandum & Articles of Association Tax Identification Number (TIN) While the CAC has embraced digital registration, foreign investors often benefit from engaging local counsel to navigate name reservations, documentation requirements, and post-incorporation filings efficiently. Sector-Specific Licensing & Regulatory Approvals Merely incorporating a company does not authorize business in regulated sectors. Depending on the nature of your operations, you may need one or more approvals from relevant regulators: Failure to secure the right licenses can result in fines, shutdown orders, or denial of repatriation rights. In the fintech and payments sector, the Central Bank of Nigeria (CBN) serves as the primary regulator, with common approvals including the Payment Service Provider (PSP) license and the Microfinance Bank (MFB) license. For the securities and cryptocurrency space, oversight is handled by the Securities and Exchange Commission (SEC), which issues the Virtual Asset Service Provider license as a key approval requirement. In logistics and transport, the Courier Regulatory Department under the Ministry of Transport regulates the industry, with approvals such as courier licences and vehicle permits being commonly required. The manufacturing and import sector is supervised by agencies such as NAFDAC, the Standards Organisation of Nigeria (SON), and the Nigeria Customs Service. Companies in this sector typically need approvals like product registration and import permits. Lastly, the telecommunications and ICT sector is regulated by the Nigerian Communications Commission (NCC), with approvals such as the Internet Service Provider (ISP) license, among others. Capital Repatriation & Tax Considerations A key concern for foreign investors is the ability to repatriate capital and profits. Nigeria permits this through official channels under certain conditions: Certificate of Capital Importation (CCI): Issued by a commercial bank and endorsed by the Central Bank of Nigeria (CBN), this document proves that investment funds came into Nigeria legally. It is a prerequisite for dividend/profit repatriation and loan repayment in foreign currency. Tax Compliance: Company Income Tax (CIT) – 30% (or 20% for SMEs) Withholding Tax – 5% to 10% on dividends, interest, royalties Value Added Tax (VAT) – 7.5% Other levies – may apply at state or local government level Strategic tax planning especially in the context of cross-border structures can significantly reduce exposure and ensure compliance. Immigration and Employment Regulations Setting up local operations may require foreign personnel. Key immigration steps include: Business Permit from the Ministry of Interior Expatriate Quota approvals Combined Expatriate Residence Permit and Aliens Card (CERPAC) for individual employees At the same time, companies must comply with Nigerian labour laws, which regulate employment contracts, termination rights, minimum wage, and statutory contributions (e.g., pension, health insurance, and industrial training). A well-drafted employment contract and an employee handbook tailored to Nigerian law are essential to managing your workforce risk. Contracting and Legal Risk Management Whether leasing property, engaging vendors, or entering a joint venture, you must ensure your contracts are: Legally enforceable in Nigeria Clear on jurisdiction, dispute resolution mechanisms, and governing law Reviewed in light of statutory protections, such as the Investments and Securities Act or the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act We advise clients to prioritize risk allocation in commercial agreements, IP protection, and exit clauses, especially when dealing with unfamiliar partners or markets. Dispute Resolution: Courts or Arbitration? Nigeria recognizes both litigation and alternative dispute resolution (ADR) mechanisms. In cross-border arrangements, arbitration is often preferred due to: Neutrality Speed and confidentiality Recognition under the New York Convention (to which Nigeria is a signatory) The Trusted Advisors provides strategic advice on drafting effective dispute resolution clauses tailored to your commercial realities and enforcement concerns. Conclusion: The Value of Local Counsel Navigating Nigeria’s legal terrain requires more than general knowledge. It demands local insight, regulatory awareness, and a practical, deal-oriented approach. At The Trusted Advisors, we provide end-to-end legal support to foreign investors from business registration to license acquisition, contract negotiation, regulatory compliance, and long-term legal advisory. We pride ourselves on bridging the gap between legal complexities and commercial execution. If you’re considering entering or expanding into the Nigerian market in 2025, we’d be delighted to support your journey. To schedule a free consultation or make Further details, contact Olawunmi Ojo on: +2348038954988, [email protected] By Olawunmi Ojo

Introduction Nigeria is one of Africa’s most attractive markets for foreign direct investment, but entering the market alone can be daunting. Many foreign investors especially those in industries like oil and gas, infrastructure, agriculture, logistics, and manufacturing—opt to partner with Nigerian companies through joint ventures (JVs). Joint ventures can offer foreign investors speed to market, local market intelligence, regulatory compliance, and risk sharing. However, a poorly structured JV can lead to disputes, loss of investment, or regulatory penalties. At The Trusted Advisors, we regularly help clients structure, negotiate, and manage joint ventures that protect their interests while leveraging the power of local partnerships. This article explores the key legal considerations for foreign investors entering into joint ventures in Nigeria. Advantages of using Joint Venture for Entering Foreign Markets (Nigeria as a case study) Joint ventures are especially valuable for: Market entry with reduced risk Access to local licenses, approvals, or sectoral knowledge Meeting Nigeria content or equity participation requirements (especially in oil & gas, telecoms, mining) Leveraging an existing company’s infrastructure, client base, or distribution network Joint ventures can be contractual or equity-based, with varying levels of integration depending on the business model and risk appetite. Forms of Joint Ventures in Nigeria There are two primary structures: Equity Joint Venture This involves the creation of a new entity jointly owned by the foreign and local partners. The parties contribute equity, assets, or expertise and operate the business through the new company. In an equity joint venture, ownership is typically structured via a Shareholders’ Agreement, governance is handled through a Board of Directors and profits are shared in proportion to equity or as agreed. This is the most common model for long-term partnerships in Nigeria. Contractual Joint Venture In this model, parties do not incorporate a new entity but work together under a detailed contract to pursue a specific project (e.g., construction, EPC, logistics). This is common in one-off projects or short-term collaborations, it is easier to set up but harder to manage over time and disputes can arise if roles and risks are not clearly defined Regulatory Approvals and Compliance in Joint Ventures in Nigeria Depending on the sector, your JV may require approvals or licenses from one or more Nigerian regulators. For instance: In the oil and gas sector, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is the key regulator. Companies operating in this space are required to ensure Nigerian Content compliance and, where applicable, obtain joint venture (JV) approval. Within the telecommunications and ICT sector, regulation is overseen by the Nigerian Communications Commission (NCC). One of the major requirements in this industry is compliance with licensing conditions, particularly in relation to foreign shareholding. For the finance and fintech sector, the Central Bank of Nigeria (CBN) serves as the principal regulator. Entities in this sector must secure the necessary licenses and, in some cases, obtain shareholder approval before commencing or expanding operations. Finally, in the power and infrastructure sector, the Nigerian Electricity Regulatory Commission (NERC) regulates participation. Companies intending to operate in power generation or distribution must obtain the relevant permits from NERC. Also, equity contributions from foreign partners must be reported through authorised dealers to obtain a Certificate of Capital Importation (CCI)—essential for repatriating dividends or disinvestment proceeds.  Key Legal Documents You Must Get Right Whether equity-based or contractual, these documents are critical: Joint Venture Agreement Shareholders’ Agreement (if a company is formed) Memorandum of Understanding (MoU) for early-stage alignment Service or Technical Assistance Agreements  if IP, technology, or management is provided by one party Non-Disclosure and Non-Compete Clauses Exit Clauses and Dispute Resolution Mechanisms We strongly advise against “template” JV agreements. Your structure must reflect your unique regulatory, tax, and commercial realities. Risk Allocation and Governance Issues in Joint ventures A well-drafted JV agreement should address the following issues: Capital Contributions: cash, IP, equipment, goodwill? Decision-Making: board control, veto rights, deadlock resolution Profit Distribution: based on shareholding or custom formula? Management Roles: who appoints key executives? Exit Options: drag-along, tag-along, buyouts, termination triggers Dispute Resolution :  local courts vs arbitration, seat of arbitration Tax and IP Considerations Double taxation may arise if not structured properly. Nigeria has tax treaties with some countries, which can be leveraged for withholding tax relief. Determine if the JV will enjoy any pioneer status incentives, which offer tax holidays. If your JV involves technology, processes, or proprietary tools, you must protect your IP through licensing agreements, registrations, or trademark protections Cultural and Operational Alignment Beyond legal issues, many JV failures stem from misaligned expectations, communication gaps, or incompatible operational cultures. We advise our clients to: Conduct thorough due diligence on potential Nigerian partners Align expectations and objectives early Start with a pilot or phased rollout where possible Frequently Asked Questions (FAQs) Q1: Can a foreign company own 100% of a joint venture in Nigeria? A: Yes, a foreign company can wholly own a Nigerian company that enters a joint venture with another entity. However, in some regulated sectors such as oil and gas, telecoms, and aviation, Nigerian content laws may require a minimum level of local participation or ownership. Q2: Is it mandatory to incorporate a new company for a joint venture in Nigeria? A: Not necessarily. Joint ventures can be structured either through the formation of a new incorporated entity or by contract alone (contractual joint ventures). The appropriate structure depends on the nature, duration, and risk profile of the project. Q3: What legal documents are essential for a joint venture? A: At a minimum, foreign investors should ensure they have: A detailed Joint Venture Agreement A Shareholders’ Agreement (if an entity is formed) Clearly defined dispute resolution and exit clauses Non-disclosure and non-compete provisions Additional sector-specific agreements (e.g., IP licenses or technical assistance agreements) may also apply. Q4: How are disputes typically resolved in Nigerian joint ventures? A: Most JV agreements involving foreign parties include arbitration clauses. Nigeria is a signatory to the New York Convention, making international arbitration awards enforceable. Arbitration offers confidentiality, neutrality, and relative speed over local litigation. Q5: How long does it take to set up a joint venture in Nigeria? A: Timelines vary depending on the sector and complexity. A basic equity JV (with a new company) can be set up in 2–4 weeks, while contractual JVs may be quicker. If regulatory approvals or licenses are involved, allow 6–12 weeks or more. Conclusion: Strategic Partnerships Require Strategic Legal Advice Joint ventures in Nigeria can be the key to unlocking real value but only if structured thoughtfully, executed strategically, and governed wisely. At The Trusted Advisors, we bring deep experience in cross-border commercial structuring, regulatory advisory, and JV governance. Considering a joint venture in Nigeria? Let us help you get it right from day one. Contact our corporate advisory team head; Olawunmi Ojo below: Email: [email protected] Telephone: +2348038954988 By Olawunmi Ojo Corporate & Commercial Practice Group, The Trusted Advisors