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JURISDICTION TO LEGISLATE
ON ARBITRATION:
DOES THE FEDERAL LEVEL OF
GOVERNMENT IN NIGERIA
HAVE EXCLUSIVE
JURISDICTION?
May 2009 Vol. 22: Issue # 5
In 2007, the government of Lagos State
in Nigeria set up a committee to make
an arbitration law for the state. The
efforts of the committee gave birth to the
state's Arbitration and Conciliation Bill
which is still pending before the state's
Assembly. The Bill contains many
landmark provisions designed among
other things to establish a regional
Arbitration Court in Lagos aimed at
making the state the arbitration hub of
West Africa.
Following this development, a debate
has arisen among arbitrators, lawyers,
and various stakeholders as to which
tier of government in Nigeria has power
to legislate on Arbitration? Being a
federal government, the core issue is
whether arbitration falls under the
exclusive, concurrent or residual
legislative list? Does the 1999
Constitution or any other law forbid any
state of the Federation from making her
own law on Arbitration? Or is the
Federal Government's power to legislate
©Blackfriars LLP 2009. All rights reserved. This document is for general guidance only. Definitive advice
should be sought from counsel if required. Blackfriars LLP is a Nigerian law firm with a representative
office in Toronto, Canada.
on this subject curtailed or limited to
specific area(s) of the subject?
Indeed, the opinions of lawyers in
Nigeria are divided on this issue.
Having emerged from decades of
military rule and the attendant
distortion of the federal impulses and
frameworks of governance, it is not
surprising that many otherwise
knowledgeable lawyers would be
instinctively inclined to defer to the
federal level of government on this
issue.
While many lawyers are agreed on the
importance of arbitration as one of the
alternative dispute resolution
mechanisms, there are serious
disagreements on the question of the
extent to which a state or the Federal
Government can legislate on arbitration.
A sampling of the opinions of lawyers
reveals the existence of three schools of
thought on the issue.
The first school of thought argues that
the federal level of government is
constitutionally empowered to legislate
on arbitration. A second school of
thought argue that only the states had
the unfettered power to legislate on the
subject while the third school of thought
is of the view said the states do not have
power to enact arbitration laws.
On the second school of thought, a more
nuanced approach contends that the
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Federal Government's power to legislate
on arbitration is constitutionally limited
to bilateral investment treaties while a
state has the power to legislate on all
other areas of arbitration. Reliance is
placed by this school of thought on Item
52 of the Second Schedule of the 1999
Constitution which gives the Federal
Government power to legislate only on
the arbitration issues arising from
bilateral investment treaties (Between
Nigeria and other countries and
between states); thus, preserving the
power of states to legislate on the
remaining aspects.
With regard to the first school of
thought, it is often posited that Section
315 (1) of the 1999 Constitution
preserves the 1988 Arbitration and
Conciliation Act, which of course
applies to the whole of the country. I
humbly disagree with this. However,
Item 58 of the Second Schedule contains
a provision that gives the Federal
Government power to legislate on "any
matter incidental or supplementary to
any matter mentioned elsewhere in the
list." Arguably, the Federal Government
has the power to legislate on the subject.
However, the question is whether this
power is exclusive.
The better view seems to be that
jurisdiction to legislate on arbitration is
dependent on the parties involved in the
arbitration and the subject-matter of the
arbitration. Item 58 of the Second
©Blackfriars LLP 2009. All rights reserved. This document is for general guidance only. Definitive advice
should be sought from counsel if required. Blackfriars LLP is a Nigerian law firm with a representative
office in Toronto, Canada.
Schedule of the 1999 Constitution
cannot reasonably be construed to debar
states from creating arbitral bodies and
procedures on matters within the
jurisdiction of states. If one follows the
reasoning of the first school of thought,
the result would mean that the Federal
Government would legislate on
virtually every subject-matter including
disposal of refuse in villages. Surely,
such an outcome could not have been
the intendment of the law-giver.
It is therefore submitted that the test
ought to be: what is the subject-matter
of the arbitration? And, who are the
parties to the arbitrations? Where the
subject-matter of a dispute subject to
arbitration clause pertains to
international trade and commerce with
international or inter-state correlation, it
stands to reason that the applicable law
ought to be the National Arbitration
law. The National Assembly should
have the exclusive jurisdiction to
legislate on such arbitration issues.
On the other hand, for disputes which
ordinarily fall within the legislative
jurisdiction of state Houses of
Assembly, it will be absurd to deny
states the power to provide for
arbitration. It would be perverse to hold
that a state House of Assembly or the
High Court of states can make rules for
litigation on some issues as delimited by
the 1999 Constitution and yet deny the
same institutions the power to make
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rules on arbitration on the same subject-

matter. Perhaps, the Nigerian
authorities would do well to borrow a
leaf from other federal systems of
government with well-developed
systems of arbitration.

For further information, please contact:

Ms. Nkeiru Onyeaso

Ms. Nkeiru Onyeaso
Tel: +234 808 718 0833
Email: Nkay@blackfriars-law.com
Fax: +1 646 536 8978

Dr. Virtus Igbokwe

Tel: +234 802 220 4755
Email: Virtus@blackfriars-law.com
Fax: +1 646 536 8978

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©Blackfriars LLP 2009. All rights reserved. This document is for general guidance only. Definitive advice
should be sought from counsel if required. Blackfriars LLP is a Nigerian law firm with a representative
office in Toronto, Canada.