Nigeria has secured a major legal victory after an arbitral tribunal dismissed in its entirety a $6.2 million claim brought against the country by European Dynamics UK Ltd, an international technology contractor, over a disputed national e-Procurement project.
The ruling followed an arbitration initiated by the company against the Bureau of Public Procurement (BPP) and was delivered at the International Centre for Arbitration and Mediation, Abuja. The decision, which is final and not subject to appeal, was handed down by Mrs Funmi Roberts, the sole arbitrator.
This development was disclosed in a statement issued by Mr Kamarudeen Ogundele, Senior Assistant on Communication and Publicity to the Lateef Fagbemi, the Attorney-General of the Federation and Minister of Justice.
According to the statement, the tribunal dismissed all claims by European Dynamics, thereby relieving Nigeria of a potential financial exposure estimated at more than $6.2 million—equivalent to about ₦9.3 billion in claimed payments and damages.
European Dynamics had sought approximately $2.4 million for alleged milestone completions, $3 million in general damages, and an additional $800,000 as settlement claims, all of which were rejected by the tribunal.
Background to the Dispute
The dispute arose from a contract for the design, development, customisation, supply, installation and maintenance of a national electronic Government Procurement (eGP) system. The project was financed with support from the World Bank and was designed to enhance transparency, accountability and efficiency in federal public procurement.
Upon assuming office, the Director-General of the BPP, Adebowale Adedokun, inherited both a stalled technology project and ongoing arbitration proceedings. Although discussions had previously taken place regarding an out-of-court settlement, the bureau opted to proceed with arbitration, insisting that payments must be strictly tied to verifiable value delivered.
Tribunal Upholds Nigeria’s Position
Central to the dispute was the User Acceptance Test (UAT) conducted by the BPP, which revealed significant functional deficiencies in the system, including critical omissions and errors affecting performance.
The bureau argued that unlike traditional supply contracts, software customisation projects require performance validation, with delivery deemed complete only after a successful UAT confirming compliance with technical, statutory and operational requirements.
The tribunal agreed with Nigeria’s position, holding that the identified deficiencies were the contractor’s responsibility to remedy at no additional cost. It further ruled that European Dynamics, as the technical expert, bore full responsibility for ensuring compliance with contractual obligations, regardless of any earlier technical documents approved by the BPP.
The arbitrator also found no contractual basis for the contractor’s claim that multiple project phases had been merged into a single phase, noting that payments under the contract were clearly structured in phases.
A Landmark Signal for Public Sector Contracting
Presenting the arbitral award to the Minister of Justice, Adedokun described the outcome as a landmark moment for public sector technology contracting in Nigeria.
“This particular vendor has taken various African countries to court and won every single case. Nigeria is the first to defeat them,” he said, praising the confidence placed in Nigerian legal professionals.
He expressed appreciation to the Attorney-General for authorising the proceedings, noting that the decision saved the country billions of naira that can now be redirected toward critical national development.
Commending the BPP leadership and the legal team, Fagbemi described the victory as a strong signal to the international community.
“By standing up to European Dynamics, Nigeria has instilled courage in other African nations to protect their own resources. It is no longer business as usual,” the minister said.
Legal Representation and Lessons Learned
Nigeria’s legal team was led by Johnson & Wilner LLP, a Nigerian business and technology law firm, with Basil Udotai, the firm’s founding partner, leading the arbitration alongside strategic partners and associates.
The ministry noted that legal representatives for the BPP have encouraged the integration of lessons from the arbitration into ongoing e-procurement reforms, with the aim of strengthening contract performance oversight and reducing the risk of future disputes.
