Nigeria has secured a major international arbitration victory after a tribunal dismissed in its entirety a $6.2 million claim brought against the country by European Dynamics UK Ltd over a disputed national e-procurement project.
The case, instituted against the Bureau of Public Procurement (BPP), stemmed from a contract for the design, development, customisation, installation and maintenance of a national electronic Government Procurement (eGP) system supported by the World Bank.
In a final award not subject to appeal, the arbitral tribunal rejected the contractor’s claims for approximately $2.4 million in alleged milestone payments, $3 million in general damages and $800,000 in settlement claims. The ruling effectively relieved Nigeria of financial exposure estimated at over $6.2 million, equivalent to about ₦9.3 billion.
Nigeria’s legal team was led by Johnson & Wilner LLP, with its founding partner, Basil Udotai, spearheading the defence alongside strategic partners and associates.
The dispute originated from the implementation of the eGP system intended to enhance transparency, accountability and efficiency in federal procurement processes.
Upon assuming office, the Director-General of the BPP, Dr Adebowale Adedokun, inherited both a stalled project and ongoing arbitration proceedings. Prior to his appointment, discussions had reportedly been held regarding a possible out-of-court settlement. However, the bureau opted to proceed with arbitration, maintaining that payments under the contract must correspond strictly to demonstrable value delivered.
Central to the dispute was the outcome of the User Acceptance Test (UAT), which identified significant functional deficiencies in the system, including critical omissions and performance errors. The BPP argued that in software customisation contracts, delivery is validated through satisfactory performance testing rather than mere physical handover.
The tribunal upheld Nigeria’s position, ruling that the identified deficiencies fell within the contractor’s obligation to remedy at no additional cost. It further held that the vendor, as the technical expert, bore responsibility for ensuring that the system complied fully with contractual specifications, regardless of any prior technical document approvals.
The tribunal also found no contractual basis for the contractor’s alleged merger of multi-phase modules into a single phase, noting that payment under the agreement was structured in phases. Consequently, all claims by European Dynamics UK Ltd were dismissed.
Speaking during a formal presentation of the award to the Attorney General of the Federation and Minister of Justice, Lateef Fagbemi (SAN), Dr Adedokun described the outcome as a landmark for public sector technology contracting.
He noted that the contractor had previously prevailed in disputes against several African countries, adding that Nigeria’s success signalled a shift in approach to contract enforcement and dispute resolution.
Responding, Fagbemi commended the BPP leadership and the legal team for what he described as a courageous and professionally executed defence. He stated that the ruling sends a strong message to the international business community that Nigeria will rigorously defend its contractual and financial interests.
The Attorney General also praised the administration of Bola Ahmed Tinubu for supporting institutional strengthening within the justice sector.
Legal representatives for the BPP said the ruling underscores the importance of clearly defined milestones, rigorous User Acceptance Testing and strict adherence to performance-based standards in government technology projects.
They urged that lessons from the arbitration be integrated into ongoing e-procurement reforms to strengthen oversight, improve contract management and minimise the risk of future disputes.
