Nigeria has won $6.2 million arbitration case against the European Dynamics UK Ltd, an international technology contractor which entered into a dispute with the Bureau of Public Procurement, BPP.
Mr Kamarudeen Ogundele, Senior Assistant on Communication and Publicity to the Attorney-General of the Federation and Minister of Justice disclosed that the European Dynamics UK Ltd, an international technology contractor had entered into a dispute with the BPP over a national e-Procurement project.
It noted that the ruling which is final and not subject to appeal was dismissed by Mrs Funmi Roberts, the Sole Arbitrator when the tribunal sat at the International Centre for Arbitration and Mediation, Abuja.
“The tribunal dismissed the contractor’s claims in their entirety, relieving Nigeria of potential financial exposure estimated at over 6.2 million dollars (approximately ₦9.3 billion) in claimed payments and damages.
“The European Dynamics UK Ltd had claimed approximately 2.4 million dollars for alleged milestone completions, 3 million dollars in general damages and an additional 800,000 thousand dollars settlement claims.’’
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It added that the Director-General of the BPP, Dr Adebowale Adedokun, inherited a stalled technology project together with ongoing arbitration proceedings upon assumption of office.
Prior to Adedokun’s appointment, there had been discussions around an out-of-court settlement but the bureau, however, elected to continue with the arbitral process, maintaining that payments must be tied strictly to demonstrable value delivered.
The underlying contract concerned the design, development, customisation, supply, installation and maintenance of a national electronic Government Procurement (eGP) system financed with support from the World Bank.
The project was designed to strengthen transparency, accountability and efficiency across federal public procurement processes.
Central to the dispute was the User Acceptance Test, UAT, but the BPP identified significant functional deficiencies, including critical omissions and errors affecting system performance.
The bureau argued that unlike conventional supply contracts where delivery may occur upon physical handover, software customisation projects are performance-validated.
That delivery crystallises only upon satisfactory UAT confirming that the system operates in accordance with the technical requirements, statutory workflows, and operational environment for which it was commissioned.
The ministry noted that the tribunal accepted Nigeria’s position that these deficiencies fell within the vendor’s responsibility to remedy at no additional cost.
It further held that the contractor, as the technical expert, bore the obligation to ensure that the delivered system complied with contractual requirements irrespective of earlier technical documents that might have been approved by the BPP.
The tribunal also found no evidence that the bureau consented to the merger of multi-phase modules into a single phase and nothing in the contract suggests that such a merger is permissible, particularly given that payment is structured in phases.
Consequently, the tribunal dismissed all claims by European Dynamics UK Ltd in their entirety and ruled that the contractual framework was distorted.
The ministry also noted that Adedokun, during a formal presentation of the award to the minister of justice, described the outcome as an important signal for public sector technology contracting.
“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.
He expressed appreciation to the minister for approving the proceedings, noting that without such support, Nigeria would have lost billions of Naira that can now be spent on critical national development.
The AGF, Lateef Fagbemi commended Adedokun’s courage and the brilliance of the legal team adding that 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 minister commended the president for sustained support to institutional strengthening within the justice sector, saying “We have a leader, mentor and father that can always watch our back.
The statement noted that the legal representative for the BPP encouraged the incorporation of lessons from the arbitration into ongoing e-procurement reforms to strengthen contract performance oversight and reduce the risk of future disputes.
It added that the Nigeria’s legal team was led by Johnson & Wilner LLP, a Nigerian business and technology law firm, with Basil Udotai, Founding Partner, leading the arbitration together with the firm’s strategic partners and associates.
NAN
