A court has ordered another Nigerian asset to be seized over the country’s ongoing legal tussle with Zhongshan Fucheng Industrial Investment Co. Ltd., a Chinese firm.
In January 2023, the superior court of Quebec in Canada
ordered the seizure of Bombardier 6000 Jet (type BD-700-1A10) belonging to
Nigeria.
The Canadian court ordered “Mise-en-cause (Tibit Limited)
and/or the Custodians (Aviation Etcetera SEC and/or Starlink Aviation Inc.) or
any of their parent, subsidiary or affiliated entities” to hand over the jet.
The order was made by David Collier, the judge.
The Chinese firm approached the Canadian court for the
seizure in a bid to enforce a $70 million arbitral award against Nigeria.
NIGERIA’S DELAYED
RESPONSE
After the seizure order in January 2023, Nigeria was
summoned to the Quebec court.
According to court documents, Nigeria had been notified of
the legal action by the Chinese on April 19, 2023, through diplomatic channels.
Nigeria did not file its response within the timeframe as
stipulated in the Code of Civil Procedures.
Although the deadline is not mandatory, the Canadian court
reserves the right to determine whether a party filed within the timeframe.
After receiving the diplomatic notification of the request
to enforce the arbitral award in Canada, Nigeria filed a response on January
11, 2024.
On February 15, 2024, Nigeria filed a request to be absolved
of its failure to respond within the stipulated time.
Nigeria had told the court that it could not respond
expeditiously because there was a delay while comparing notes with the Ogun
state government — the subnational entity responsible for the arbitral award.
Nigeria said Ogun held a governorship election in March 2023
and that an attorney-general for the state was not appointed until October
2023.
Nigeria added that it was unable to brief its Quebec lawyers
before January 11, 2024.
In his ruling in March 2024, Chantal Corriveau, a judge at
the superior court of Quebec, dismissed Nigeria’s argument as “unreasonable”.
HOW NIGERIA GOT THE
SEIZED JET
In May 2020, a court in the province of Quebec granted the
seizure order of the jet in favour of the federal government.
The government told the court that the jet was originally
acquired by Dan Etete, a former minister of petroleum.
Nigeria said the jet was procured from the controversial oil
prospecting licence (OPL) 245 deal.
It was also alleged that the jet was acquired in the name of
Tibit Limited, a company incorporated in the British Virgin Islands.
The sum of $57 million was said to have been used to
purchase the jet in 2011.
The OPL 245 deal involves the $1.3 billion purchase of an
oil block by Royal Dutch Shell and Eni from Malabu Oil and Gas, a company in
which Etete had major shares.
THE CHINESE FIRM’S
CASE
In 2010, Zhongshan, through Zhuhai Zhongfu Industrial Group
Co. Ltd. (Zhuhai), its Chinese parent company, acquired rights to develop a
free trade zone in Ogun state.
A year later, Zhongshan set up Zhongfu International
Investment (NIG) FZE (Zhongfu) to manage the project, with the permission of
the Ogun state government.
However, things took a different turn in July 2016 when the
investor accused the state government of abruptly moving to terminate its
contract, while attempting to install a new manager for the free trade zone.
Subsequently, Zhongfu initiated an investment treaty
arbitration against Nigeria under the bilateral investment treaty between the
People’s Republic of China and Nigeria (the China-Nigeria BIT).
The arbitrators had ruled that Nigeria was in breach of its
obligations under the China-Nigeria BIT and awarded Zhongshan a compensation of
about $70 million.
Recently, a French court ordered the seizure of three
presidential jets belonging to the Nigerian government over the contract
dispute.
A court of appeal in the United States also ruled that Nigeria’s
claim of sovereign immunity cannot stand in a commercial venture.
A commercial court in London had also granted the Chinese
firm permission to seize two residential properties owned by Nigeria in the UK
— over the arbitral award.
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