‘Nigeria Has Many Positive Features Which Make It Attractive For International Arbitration’

A member of the London-based international law firm, Hogan Lovells and its partner, international arbitration group, Mr. Nathan Searle, visits Nigeria regularly and is very conversant with African legal market.

In this interview with Assistant Editor, Law and Foreign Affairs, JOSEPH ONYEKWERE, he explained that Nigeria has a lot of positive features that make it attractive for international arbitration, adding that the new arbitration act, when passed into law would refine international arbitration process in the country. 

Nathan Searle, a law graduate of Bond University, Australia is a partner in Hogan Lovells International arbitration group, acting for large multinationals in complex and high-value international arbitrations and cross-border disputes. He has extensive experience in African-related disputes and is an active member of the firm’s cross-practice Africa group.

Nathan also has experience in other emerging markets including Asia, India, Russia and the Commonwealth of Independent States (CIS).Nathan has higher rights of audience in the English courts and regularly appears as an advocate in international arbitrations. He also advises clients on risk management and strategies to avoid or resolve disputes at an early stage.

Given your extensive experience, what in your opinion are the most successful mitigation strategies in settling disputes in African markets?

My top three tips for mitigating risk and managing emerging disputes are: Identify and preserve your rights – find out whether you have a leg to stand on. 2. Communicate your position clearly and consistently – make sure that you have the right team and that you are all working together to communicate the same message. 3. Pick your battles wisely – make sure that you have assessed all the potential advantages and disadvantages of pursuing a particular course of action. Legal proceedings can be lengthy, costly, damaging to relationships and reputation. Don’t rush off to start legal proceedings without first thinking through whether there may be other options to find a solution.

What are the advantages of using arbitration over litigation in intellectual property/copyright infringement?
In arbitration, parties are able to resolve disputes confidentially, which is particularly attractive in cases involving intellectual property, trade secrets and copyright. Parties are also able to appoint a tribunal who has specialist expertise in intellectual property which is a specialist area of the law. Many intellectual property cases involve highly technical material or where knowledge of a specific technology would be beneficial and arbitration generally allows the parties or appointing authority to select arbitrators with the relevant technical skills and knowledge.

In this part of the world (Africa), cases arising from copyright infringement take a lot of time and resources to be settled. How can this be mitigated?
Let’s look more broadly into the African region where we often see intellectual property disputes arising in cases of technology transfer and trademark licensing.

In a situation like this where the subject matter is highly technical, parties may wish to use arbitration to bring in specialists with relevant technical knowledge to act as arbitrators in order to cut through these technical issues that often arise in intellectual property disputes (because they already have experience and expertise).

If you have a decision maker that has the expertise and experience in the relevant subject matter, they can resolve an arbitration more efficiently leading to large savings of time and cost for the parties. Time is reduced in the proceedings as the tribunal can identify the important issues based on the expertise and direct the parties to address them so there is not a lot of time wasted on unimportant matters.

What are the best ways to control the cost of arbitration without compromising the fairness of the process?
It is important to select arbitrators who are familiar with the arbitral process and able to drive the case forward efficiently, especially in technical disputes.

For example, an arbitrator can decide that in appropriate cases there is a preliminary issue that can be disposed of easily at an early stage, which can make the whole arbitration run more efficiently. The parties are also free to set time limits in their arbitration clause and we often see arbitration clauses now that require low value disputes to be decided on paper so that this reduces the cost of the arbitration.

In spite of its many obvious benefits, the use of arbitration and other ADR mechanisms in resolving disputes has not gained much popularity among Nigerian litigants as many still want to go to court to settle their disputes. How can we stimulate interest in arbitration in our commercial environment?
Their lawyers often influence clients’ views of arbitration and how to resolve their disputes. Accordingly, a key way to stimulate interest in arbitration is to educate and train lawyers and create a forum for lawyers to discuss and engage in how to drive forward arbitration in Nigeria.

There are a number of organisations in Nigeria seeking to do this. These include the Association of Young Arbitrators in Nigeria, which in June 2019 launched the Africa Arbitration Academy bringing together 30 African practitioners for a three-week intensive training in London with leading arbitrators from across Africa and the broader arbitration community.

Grassroots initiatives like this, which was developed and organised by seven young Nigerian lawyers, are inspiring and will affect a real step-change for arbitration in the region. Building greater understanding among younger practitioners and showing the benefits of arbitration for resolving commercial disputes for small to medium-sized enterprises (particularly as the procedures are flexible and can be adapted to suit the parties and the nature of the dispute) could really drive growth in the use of arbitration in Nigeria.

In Nigeria, intellectual property theft and privacy are very rampant and investors lose billions over these issues. How can those be addressed?
I think it is partly about creating awareness of the repercussions of IP theft and piracy.

The exciting thing is Nollywood has a huge domestic demand and also exporting the content of those films internationally. Consumers need to understand the policy behind the protection of intellectual property rights and realize it is about protecting the investments of those creating the content and essential to the growth and success of the creative industries.

I think it’s something that will take time because it involves changing people’s culture and values. It also requires the government and judiciary being supportive of existing laws to protect intellectual property rights. Resources should also be devoted to clamp down on the pirates and support intellectual property owners in taking action to enforce and protect their rights.

We have the largest population as well as the largest economy on the African continent. In what ways do you think we can make arbitration more attractive in Nigeria and stop the outflow of arbitral tribunals?
Nigeria has many positive features which make it attractive for international arbitration. It has a modern arbitration law, which the new Arbitration Act being considered by the Nigerian National Assembly will further improve and refine.

It also has a large community of lawyers who have specialist knowledge and training in arbitration, as demonstrated by the fact that it has the largest number of members of the Chartered Institute of Arbitrators of any African country.

So how can Nigeria further grow its vibrant arbitration community and attract a higher volume of arbitrations?

Looking on a global scale, the cities which have become most popular and successful for international arbitrations are those which have focussed on becoming a regional hub to attract disputes from parties who are based outside their country.

A key to Nigeria becoming a regional hub for arbitration will be for Nigeria to attract parties from outside to come to Nigeria to arbitrate their disputes and appoint Nigerian arbitrators to decide disputes between non-Nigerian parties. This is already happening.

There are many well-known Nigerian arbitrators who are being appointed to sit as arbitrators on large international arbitrations. For example, I am currently involved in two cases where there are Nigerian arbitrators on the panel but in neither of these cases is a Nigerian party involved.

Do you think government can approach the issue of arbitration more effectively through policy or legislation?
The Nigerian Government is already taking action to further refine and improve the arbitration law through the new Arbitration Act, which I understand the Nigerian National Assembly is in the process of considering passing into law.

What do you think accounts for the spread and acceptance of international arbitration?
The three most attractive features of arbitration are: Enforceability – the New York Convention means that arbitral awards are enforceable in over 150 countries. Flexibility – the parties are free to select the process for appointing arbitrators and the procedure to be adopted to resolve their dispute. It gives the parties control over the process so that it can be tailored to their commercial needs. Neutrality – where you have parties of different countries, language or culture it enables them to appoint a neutral tribunal to resolve their dispute rather than being in the “home” courts of one of the parties.

Despite the attractiveness of arbitration, which includes speed and confidentiality, it appears that commercial disputes still pass the whole hog of litigation. What do you think accounts for this?
Because of the flexibility of the arbitral process it is difficult to make generalisations about a “typical” arbitration for a commercial dispute.

I have had large commercial cases where the parties have required an outcome within a few months and the tribunal has made this happen. I have also been involved in arbitrations where the scope of document production ordered has been very limited. However, if the lawyers and parties wish to run the arbitration in a manner similar to litigation there is flexibility for them to do so with the tribunal’s agreement.

In my experience, the amount of time and money that parties are willing to spend on resolving a dispute tends to be in proportion to the value at stake.

How do you allay the fear of African lawyers, particularly Nigerians, who are reluctant in embracing arbitration so as not to lose fees, which come from traditional litigation?

Lawyers are integral to the arbitration process both as counsel and arbitrators. There are substantial opportunities for Nigerian lawyers who embrace arbitration.