Nigeria, through the Bureau of Public Procurement (BPP), has secured another major victory in a complex international arbitration, defeating claims brought by European Dynamics UK Ltd over a national e-procurement project.
In a final ruling not subject to appeal, the arbitral tribunal dismissed the contractor’s claims in their entirety, relieving Nigeria of potential financial exposure estimated at over $6.2 million (approximately ₦9.3 billion) in alleged payments and damages.
Nigeria’s legal team was led by Johnson & Wilner LLP, a Nigerian business and technology law firm, with Basil Udotai Esq., Founding Partner, spearheading the arbitration alongside the firm’s strategic partners and associates.
Upon assuming office, the Director-General of the BPP, Dr. Adebowale Adedokun, inherited a stalled technology project alongside 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 in settlement claims.
Before Dr. Adedokun’s appointment, discussions had reportedly been held around an out-of-court settlement. However, the Bureau opted to continue with the arbitral process, maintaining that payments must be strictly tied to demonstrable value delivered. This decision led to the engagement of a specialised Nigerian legal team with expertise in technology contracting to review the technical and contractual issues in dispute.
The underlying contract involved 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 intended to strengthen transparency, accountability and efficiency in federal public procurement processes.
Central to the dispute was the User Acceptance Test (UAT). The UAT conducted by the BPP identified significant functional deficiencies, including critical omissions and system errors affecting overall performance.
The Bureau argued that unlike conventional supply contracts, where delivery may be completed upon physical handover, software customisation projects are performance-validated. Delivery, it maintained, crystallises only upon satisfactory UAT confirming that the system operates in accordance with technical requirements, statutory workflows and the intended operational environment.
The tribunal upheld Nigeria’s position, ruling that the identified 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 approved by the BPP.
The tribunal also found no evidence that the Bureau consented to merging 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.
Accordingly, all claims by European Dynamics UK Ltd were dismissed in full.
“Nigeria Can No Longer Be Taken for Granted”
Speaking during a formal presentation of the award to the Attorney General of the Federation and Minister of Justice, Prince Lateef Fagbemi (SAN), Dr. Adedokun described the outcome as a defining 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. 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.
The DG expressed appreciation to the Attorney General for approving the continuation of the proceedings, noting that without such support Nigeria could have lost billions of naira that can now be channelled into critical national development priorities.
Responding, the Attorney General commended Adedokun’s resolve and the competence of the legal team.
“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 also praised the President for sustained support towards strengthening institutions within the justice sector, stressing the importance of building resilient public systems.
The ruling underscores the importance of rigorous User Acceptance Testing, clearly defined milestones and expert-driven software delivery standards in government technology projects.
In a statement issued by Kamarudeen Ogundele, Special Assistant to the President (Communication and Publicity), Office of the Attorney General of the Federation and Minister of Justice, Nigeria’s legal representatives encouraged incorporating lessons from the arbitration into ongoing e-procurement reforms to enhance contract performance oversight and reduce the risk of future disputes.
