Nigeria defeats European tech firm in $6.2m arbitration over e-procurement project
Nigeria has secured a major legal victory after an arbitral tribunal dismissed a $6.2 million claim filed by European Dynamics UK Ltd against the Bureau of Public Procurement (BPP).
The dispute arose from a national electronic Government Procurement (e-GP) project financed with support from the World Bank. The contractor had sought about $2.4 million for alleged milestone completions, $3 million in general damages, and an additional $800,000 in settlement claims.
The arbitration was presided over by sole arbitrator Mrs. Funmi Roberts at the International Centre for Arbitration and Mediation**, Abuja. In a final award not subject to appeal, the tribunal dismissed all claims, effectively shielding Nigeria from potential liabilities estimated at over $6.2 million (about ₦9.3 billion).
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According to a statement from the Office of the Attorney General of the Federation, Nigeria’s legal team was led by Johnson & Wilner LLP, with Basil Udotai Esq. spearheading the defence alongside strategic partners and associates.
The Director-General of the BPP, Dr. Adebowale Adedokun, inherited both the stalled technology project and the ongoing arbitration upon assuming office. While there had previously been discussions about an out-of-court settlement, the Bureau opted to continue with the proceedings, insisting that payments must strictly correspond to verified deliverables.
At the heart of the dispute was the User Acceptance Test (UAT), which the BPP said revealed major functional deficiencies, including omissions and system errors. The Bureau maintained that in software customisation contracts, delivery is only complete after successful performance validation through UAT.
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The tribunal upheld Nigeria’s argument, ruling that the deficiencies were the contractor’s responsibility to correct at no extra cost. It further held that the vendor bore the obligation to ensure compliance with contractual and technical requirements, regardless of any earlier approvals of technical documents.
The arbitrator also rejected claims that multi-phase project modules had been legitimately merged into a single phase, noting that the contract’s phased payment structure did not permit such an alteration.
Reacting to the outcome, Dr. Adedokun described the ruling as a landmark decision, noting that the company had previously prevailed in similar disputes across other African countries. He said Nigeria’s success demonstrated confidence in local legal expertise and institutional resolve.
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Attorney General of the Federation and Minister of Justice, Prince Lateef Fagbemi (SAN), commended the BPP leadership and legal team, describing the judgment as a strong message that Nigeria is committed to protecting public resources and strengthening governance systems.
The ruling highlights the importance of rigorous User Acceptance Testing, clearly defined milestones, and strict contract compliance in public sector technology projects, as Nigeria continues reforms aimed at improving transparency and efficiency in procurement processes.
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