AGF Fagbemi hails Nigeria's $6.2m arbitration win
…BPP’s DG commits to diligence on contract awards The Attorney General of the Federation (AGF) and Minister of Justice, Lateef Fagbemi (SAN), has expressed delight about the recent victory achieved
…BPP's DG commits to diligence on contract awards
The Attorney General of the Federation (AGF) and Minister of Justice, Lateef Fagbemi (SAN), has expressed delight about the recent victory achieved by the country in a contractual dispute with a foreign firm, European Dynamics UK Limited.
According to a statement by AGF's media aide, Kamarudeen Ogundele, European Dynamics UK Ltd, an international technology contractor, had a contract with the Bureau of Public Procurement (BPP) for, among others, 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 aimed at strengthening transparency, accountability, and efficiency across federal public procurement processes.
At one point, a dispute arose among the parties regarding the User Acceptance Test (UAT).
According to the statement, "The UAT carried out by the BPP identified significant functional deficiencies, including critical omissions and errors affecting system performance."
Parties later submitted to an arbitration process, which found in favour of the country.
The statement reads in part, "Upon assuming office, the Director-General of the BPP, Dr. Adebowale Adedokun, inherited a stalled technology project along with ongoing arbitration proceedings." European Dynamics UK Ltd had claimed approximately $2.4 million for alleged milestone completions, $3 million in general damages, and an additional $800,000 settlement claims.
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"Prior to Dr. Adedokun’s appointment, discussions had occurred regarding an out-of-court settlement. The Bureau, however, elected to continue with the arbitral process, maintaining that payments must tie strictly to demonstrable value delivered.
"That led to the engagement of the specialised Nigerian legal team with expertise in technology contracting to review the technical and contractual issues in dispute.
"Central to the dispute was the User Acceptance Test (UAT). The UAT carried out by 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.
It also argued 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 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.
“The tribunal also found that nothing in the contract suggests that such a merger is permissible, particularly since payment is structured in phases, adding that the contractual framework was distorted."
The statement added that the Sole Arbitrator, Mrs. Funmi Roberts, dismissed all claims by European Dynamics UK Ltd in their entirety.
Ogundele quoted the AGF as commending the Director General of the BPP, Adebowale Adedokun, for his courage in insisting that the arbitral process be seen through, rather than opting for an out-of-court settlement.
He further quoted Fagbemi as saying: "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."
According to Ogundele, Fagbemi also 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. If he says leave it, we have no choice… he wants to nurture strong institutions.”
According to Ogundele, Adedokun, during a formal presentation of the award to Fagbem described the outcome as an important signal for public sector technology contracting.
He quotes Adedokun as saying, “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 added that Adedokun expressed appreciation to the AGF 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.
Ogundele said the ruling underscores the importance of rigorous User Acceptance Testing, clear milestone definitions, and expert-driven software delivery standards in government technology projects.
"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," Ogundele said.
