$9bn judgment: Nigeria must pay $200,000 in 14 days or loose ‘stay of execution’ order
London, Sep 27, 2019 (AltAfrica)-The UK Commercial Court has granted the Nigerian government’s application for a ‘stay of execution’ of a $9 billion judgment debt in favour of the Irish firm, P&ID.
The judge however ordered Nigeria to deposit $200 million in the court’s account within 60 days pending its appeal, and Nigeria must pay some court costs to P&ID within 14 days, Reuters news agency reported.
If Nigeria fails to deposit the amount in the court’s account within the stipulated period, which the P&ID lawyer said was the minimum period it will take Nigeria to raise the funds from the capital markets, the court will have no option than to lift the stay of execution order.
P&ID said it was satisfied with the order for Nigeria to deposit $200 million pending the appeal, describing the allegations of fraud by Nigeria as “red herring”.
The UK Business & Property Courts (the Commercial Court), presided by Justice Butcher, on August 16 granted P&ID’s request to enforce a March 20, 2013 award against Nigeria by a District Circuit Court in Washington DC.
He also granted Nigeria’s request for a leave to file the appeal in respect of the $9.6bn arbitral award.
Court’s ruling on enforcement not award—P&ID
It said the Thursday’s ruling by the British court was not a permission to the Federal Government to appeal against the arbitral award but to appeal against its enforcement in the form of seizure of its assets.
The statement read, “For background, today’s judgment granted the Nigerian government leave to appeal the UK court’s decision that it could be subject to asset seizures to enforce the arbitration award in favour of P&ID.
“It does not allow the government to appeal the award itself.
“As you’ll be aware, the High Court in the UK heard arguments in the case today, with the Nigerian government seeking a stay of asset seizures and leave to appeal the asset seizure decision.
“The court has ruled the government may appeal – if it meets the conditions that $250,000 must be paid to P&ID in costs within 14 days and $200m in security paid to the court within 60 days.”
The British court had in August this year delivered a judgment recognising a London-based arbitration panel’s award of $9.6bn against Nigeria over a failed Gas Supply Processing Agreement signed in 2010 between the Federal Government and P&ID for “lean gas” production in the country.
Parties to the case returned to the court on Thursday with Nigeria obtaining the leave of the court to appeal against the judgment and an order of conditional stay of execution of the judgment subject to the Federal Government’s payment of security fund of $200m into the court’s account within 60days.
Nigeria failed to raise fraud allegation against us at UK court, says P&ID
Reacting to the Thursday’s proceedings in a separate statement posted on a website dedicated to the firm’s public relations on the controversial judgment, the P&ID said the Federal Government’s much-touted allegation of fraud in the GSPA which led to the arbitral award of $9.6bn against the country, was not canvassed when the matter came up before a United Kingdom court on Thursday.
The Federal High Court in Abuja had on September 19, 2019 convicted and wound P&ID Limited incorporated in British Virgin Island, and the firm’s Nigerian affiliate, P&ID (Nigeria) Limited, for fraud, tax evasion, among other sundry offences.
The Attorney General of the Federation, Mr Abubakar Malami, had said the conviction of the two firms was a judicial proof that the GSPA was fraudulent.
He had said the proof of fraud would be presented before the UK court to boost Nigeria’s chances of having the judgment set aside.
But P&ID said the fraud allegation about the agreement turned out to be a mere red herring as no evidence was put forward to back it by the Nigeria’s legal team in court.
It stated, “The Nigerian Government’s recent media exercise to allege fraud against the P&ID turned out to be a red herring. Indeed, the Nigerian Government did not present any evidence to support Attorney General Malami’s ‘findings’ from his sham investigation.
“The Nigerian Government knows there was no fraud and the allegations are merely political theatre designed to deflect attention from its own shortcomings.”
It said Nigeria must have to quickly pay the sum of $200m to avoid immediate seizure of its assets
“The court has ruled that the Nigerian Government must put up $200m to maintain a stay of execution whilst it pursues an appeal against enforcement of the now $9.6bn award in favour of P&ID.
“The Nigerian government will now have to put its money where its mouth is if it wants to avoid immediate seizure of assets.”
P&ID can seize Nigeria’s assets if deadlines are missed – Court
AFP reports that Justice Butcher said on Thursday that P&ID had the right to seize Nigerian assets should either of those deadlines be missed.
It quoted Justice Butcher as further ruling “that there may be immediate and potentially severe damage to Nigeria if there is no stay”.
FG welcomes stay of execution order
Meanwhile, the Federal Government, on Thursday, welcomed the decision of the British court that granted Nigeria’s request for a stay execution of the $9.6bn judgment it delivered in favour of Process and Industrial Development in August this year.
It described the development as a positive resolution which was an important step in government’s efforts to have the matter resolved in its favour.
The Attorney-General of the Federation, Abubakar Malami (SAN), made the government’s position known shortly after the order was made.
Malami, who is leading senior government officials who are in London said, “I am pleased with today’s development in the court and see this as a positive resolution that constitutes an important step in the government’s efforts to defend itself in a fair and just process.
“We will study the court rulings, exercise the right of appeal and consider the legal options available at our disposal as it relates to the payment of $200m in view of the 60 days window stipulated by the court.
“We look forward to challenging the UK Commercial Court’s recognition of the tribunal’s decision in the UK Court of Appeals, uncovering P&lD’s outrageous approach for what it is: a sham based on fraudulent and criminal activity developed to profit from a developing country.
Also, a statement from the Office of the Minister of Information and Culture, Lai Mohammed, quoted the attorney general as saying the decision was “a positive resolution that constitutes an important step in the government’s efforts to defend itself in a fair and just process.”