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Federal Government of Nigeria Granted Stay of Enforcement and Leave to Appeal in Key Arbitration Case

Practical Law Arbitration Blog

25 Oct 2019

Associate Jason Mbakwe authored an article for Thomson ReutersPractical Law Arbitration Blog that covers the stay of enforcement and leave to appeal granted to the Federal Government of Nigeria (FGN) in its dispute with Process & Industrial Developments Ltd (P&ID) in the English High Court.

“Having seen the arbitral award converted to an English High Court judgment in August 2019, P&ID had set about attempting to enforce the judgment against FGN’s foreign assets,” Jason writes, adding that “this was no small matter for FGN, as the amount of the arbitral award (initially $6.6 billion, now $9.6 billion, given the eye-watering interest of $1.3 million per day) would have a significant impact on Nigerian reserves and the Nigerian economy in general,” as $9.6 billion represents around 20% of FGN’s total foreign reserves, one third of FGN’s 2019 fiscal budget, 2.5% of its total GDP, and more than 50% of its earnings from crude oil in 2018.

“Although the English High Court’s recent decision may be seen to strengthen FGN’s hand slightly in potential settlement negotiations, the two parties remain a way off settlement, with the principally agreed settlement with FGN’s previous administration rejected by the current Buhari government,” Jason says, adding that “it’s difficult to predict how this dispute will be resolved, but, for now at least, it appears that FGN may get a second chance to make its case.”

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