Expert Warns FG, States Should Tighten Security To Protect FDI After Jets Seizure Incident

Expert Warns FG, States Should Tighten Security To Protect FDI After Jets Seizure Incident

A Professor of International Law, Ademola Abbas, has urged the Federal Government to review the Bilateral Investment Treaty (BIT) it signed with China in 2001 which promotes investment between the two countries.

The legal expert also encouraged the Federal Government and states not to let down their guards in the name of attracting Foreign Direct Investments (FDIs).

Abbas was a guest on Inside Sources with Laolu Akande, a sociopolitical programme aired on Channels Television on Friday.

“When countries are looking for investments, sometimes, they let down their guards and try not to be as stringent as they should be,” he said.

The law professor said that while encouraging investors to come to Nigeria, the government should not “kill itself with poison out of courtesy, which Nigeria did eventually”.

A French court recently ruled in favour of Zhongshan Fucheng Industrial Investment Co. Limited and granted the seizure of presidential jets belonging to the Nigerian government.

In the dispute involving an arbitration award, the court in Paris ruled in favour of the Chinese firm, allowing it to seize three presidential jets on routine maintenance in France as “security” for claims in a decades-long judicial matter between the foreign company and the Ogun State government.

Abbas faulted Article 9 in the existing BIT between Nigeria and China labelling it as a “misnomer” and a “grievous error” that should not have made it into the treaty.

He said the article “confers right on third parties who are not party to the treaty” even though the treaty was between two countries.

“There are 13 Articles in the treaty but Articles 8 and 9 permit resolution mechanisms in terms of conflicts between any of the countries and their nationals instead of disagreements between the two countries,” Abbas said.

Abbas said the Federal Government created a misnomer through Article 9 of the treaty by allowing a national to go after the Nigerian Government when the agreement should have been solely between Nigeria and China.

“It could have just limited the whole thing to arbitration between China and Nigeria. If there was no Article 9 in that BIT.

“What could have happened in this situation that a Chinese company has been wronged, the Chinese company would apply what is known as espousal doctrine meaning that if there is a treaty between two countries and a party is injured by one of those two countries, that person cannot go after the other country; rather, you will go to your country to espouse your right. So, it will be country to country.

“If Article 9 had not been there, Zhongshan would have returned to China to take it up with Nigeria. And China would have gone to the International Court of Justice or find a way to diplomatically resolve this with Nigeria,” he said.

Asked to suggest ways out of the debacle, the law professor said, “First, the way out is for the country to go back to the drawing board and look at this kind of treaty and try to understand the kind of arbitration clauses permitted. Maybe if the government was aware of Article 9, this wouldn’t have happened.

“There should be a national coordination and synergy between the national (the Federal Government) and sub-national authorities (states). The Chinese are not stupid, they didn’t go after Ogun State because they know they won’t get anything.