…P&ID case would have crippled Nigeria’s economy – AGF Fagbemi
The Federal Government has called on the United Nations to evolve reforms that will protect national sovereignty in arbitration disputes between investors and member-states.
The Nigerian government also advocated reforms that would reinforce rather than bypass domestic courts in Investors-States Disputes Settlement (ISDS).
A statement by Kamarudeen Ogundele, the media aide to the Attorney General General of the Federation (AGF) and Minister of Justice, Prince Lateef Fagbemi (SAN) on Thursday, in Abuja said, the AGF said this during the heads of delegations roundtable at the Chief Legal Advisors Forum (CLAF) 2026 in Singapore on Thursday.
Fagbemi said the ISDS reforms sought would address the inadequacies and imbalances in legal framework in order to protect investments and country’s taxpayers.
The AGF, while commending the forum convened by the Ministry of Law of Singapore, said as global investment flows evolve and
states confronting new
development challenges, the need for a modern, balanced, and credible dispute‑settlement system had never been more urgent.
The minister said upon assuming office, he had taken some steps to address the challenges by constituting a committee of experts to review Nigeria’s bilateral treaties and Nigeria’s commitment under multilateral treaties and conventions in order to promote and protect investments in Nigeria.
He said Nigeria became a strong proponent for clarity concerning calculation of damages because of the experience in the Process and Industrial Developments Ltd. (P&ID) case which would have crippled the nation’s economy.
“States consistently express concern about the opacity of arbitral proceedings and the unpredictability of awards. Nigeria continues to support reforms that enhance transparency of proceedings, consistency in arbitral reasoning, and predictability in outcomes. These elements are essential for investor confidence and state trust alike.
“That is why Nigeria is a strong proponent for clarity concerning calculation of damages. The current position largely relies on the whims of each arbitrator or tribunal. For example, in the notorious case of P&ID, damages were calculated on the basis of compound interest, which would have had a crippling effect to the tune of billions of dollars.
“It is with this belief that Nigeria reformed its Arbitration Act to reflect the importance of transparency. There is growing openness to fresh approaches beyond traditional arbitration,” the AGF said and added that, states had acknowledged that ISDS reform was not optional as It was essential for maintaining the legitimacy of the international investment regime.
According to the him, “Nigeria sees this consensus as a positive development: it signals that the global community understands the need for recalibration to ensure fairness, predictability, and development alignment.
“Many states, Nigeria included, believe that incremental adjustments will not address the structural imbalances embedded in the current system. There is increasing support for systemic reform, including clearer treaty standards, improved procedural safeguards, stronger accountability mechanisms, and more balanced rights and obligations for investors and states. This reflects a desire for a dispute‑settlement system that is durable and future‑proof.”
Fagbemi said Nigeria saw significant value in the innovations, particularly in reducing costs, preventing escalation, and strengthening cooperative problem‑solving and stated further that, “Strengthening national judicial institutions is central to building long‑term rule‑of‑law capacity and reducing over‑reliance on external arbitration”.
The AGF advised that there must be consideration for the integration of public interest in ISDS as it must reflect contemporary global priorities including climate action, environmental protection,
human‑rights obligations, community welfare, and sustainable development.
He added, “Nigeria strongly supports reforms that ensure investment protections do not undermine legitimate public‑interest regulation. And this is clearly reflected in the 2016 Nigerian Model Bilateral Investment Trade (BIT), which is currently under review after 10 years of being in use.
“There is a growing recognition that the challenges are shared, solutions must be collective, and reform must balance the needs of capital‑importing and capital‑exporting countries.”
END
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