European Tech Giant Loses $6.2m International Arbitration In A Case Against Nigeria

In another victory by the administration of President Bola Ahmed Tinubu, Nigeria, through the Bureau of Public Procurement (BPP) has yet again won a complex international arbitration.
European Dynamics UK Ltd, an international technology contractor, had entered into a dispute with the bureau over a national e-procurement project.

In the ruling, which is final and not subject to appeal, the 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 claimed 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, leading the arbitration together with the firm’s strategic partners and associates.

Upon assuming office, the Director-General of the BPP, Dr Adebowale Adedokun, inherited a stalled technology project together 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.
Prior to Dr Adedokun’s appointment, there had been discussions around an out-of-court settlement. The Bureau, however, elected to continue with the arbitral process, maintaining that payments must be tied 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.

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 aimed to strengthen transparency, accountability and efficiency across federal public procurement processes.

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.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.
“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,” it ruled.
Consequently, the arbitrator dismissed all claims by European Dynamics UK Ltd in their entirety.

Dr Adedokun, during a formal presentation of the award to the Attorney General of the Federation and Minister of Justice, Prince Lateef Fagbemi (SAN), 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.

Responding, the AGF commended Adedokun’s courage and the brilliance 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 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.”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 incorporating lessons from the arbitration into ongoing e-procurement reforms to strengthen oversight of contract performance and reduce the risk of future disputes.