Nigeria has secured a final international arbitration ruling dismissing $6.2 million in claims brought by European Dynamics UK Ltd over a stalled national electronic procurement project, according to a statement from the Office of the Attorney General of the Federation.
The dispute arose from a contract for the design, customisation, installation, and maintenance of a national electronic Government Procurement (eGP) system overseen by the Bureau of Public Procurement (BPP). The project, supported by the World Bank, was intended to improve transparency and efficiency in federal procurement processes.
In its final award, the arbitral tribunal dismissed all claims by the contractor, relieving Nigeria of potential liability estimated at $6.2 million, comprising $2.4 million for alleged milestone completions, $3 million in general damages, and $800,000 in settlement claims. The ruling is not subject to appeal.
At the centre of the dispute was the User Acceptance Test (UAT), a performance validation process used to confirm that software meets contractual and operational requirements. According to the statement, the BPP identified “significant functional deficiencies, including critical omissions and errors affecting system performance” during testing.
The tribunal upheld Nigeria’s position that in software customisation contracts, delivery is only deemed complete upon satisfactory UAT results. It found that the deficiencies fell within the vendor’s responsibility to correct at no additional cost and ruled that the contractor bore the obligation to ensure compliance with contractual requirements.
The tribunal also rejected claims that the BPP had agreed to merge multi-phase modules into a single phase. “Nothing in the contract suggests that such a merger is permissible, particularly given that payment is structured in phases. Consequently, the contractual framework was distorted,” the ruling stated.
Nigeria’s legal team was led by Johnson & Wilner LLP, with Basil Udotai, Esq., serving as lead counsel.
Speaking during a presentation of the award to the Attorney General of the Federation and Minister of Justice, Lateef Fagbemi, the Director-General of the BPP, Dr. Adebowale Adedokun, described the outcome as significant. “This particular vendor has taken various African countries to court and won every single case. Nigeria is the first to defeat them. We stood our ground against one of the best legal teams in the world because we believed in the expertise of our own Nigerian legal professionals,” he said.
Responding, Fagbemi said the decision signalled a shift in Nigeria’s posture in international disputes. “Nigeria is a country blessed with both natural and human resources. This win sends a clear message to the international community: Nigeria has resonated. It is no longer business as usual. By standing up to European Dynamics, we have instilled courage in other African nations to protect their own resources,” he said.
The arbitration outcome comes amid broader efforts to reform Nigeria’s public procurement processes, with officials indicating that lessons from the case will inform future technology contracting and oversight standards.
