ENFORCEMENT OF ARBITRAL AWARDS IN NIGERIA: CHALLENGES AND RECOMMENDATIONS

INTRODUCTION

On the 26th of May, 2023, the Arbitration and Mediation Act 2023 came into force, replacing the Arbitration and Conciliation Act, marking a significant milestone in Nigeria’s dispute resolution landscape.[1] The Act was widely seen as an effort to strengthen Nigeria’s arbitration framework and align it with global best practices.[2] Yet, despite this legislative progress, a persistent question remains: how effective is an arbitral award if it cannot be readily enforced?

Arbitration has long been promoted as a faster, more flexible alternative to litigation, particularly in commercial disputes.[3] In Nigeria, it is widely adopted by businesses as a private dispute-resolution process established to settle disputes by a neutral third party.[4] Its appeal lies in benefits such as confidentiality, procedural flexibility, and relative efficiency. However, the true value of arbitration lies not merely in obtaining an award, but in the ability of the successful party to enforce it through the courts when necessary.[5]

Building on this, arbitration has been defined as a mechanism for the resolution of disputes that takes place in private pursuant to an agreement between two or more parties under which the parties agree to be bound by the decision of the Arbitrators.[6] Furthermore, the legal foundation for arbitration in Nigeria is primarily established by the Arbitration and Mediation Act 2023 (AMA), which repealed the Arbitration and Conciliation Act 2004 (ACA).[7] The AMA provides a unified legal framework for the fair and efficient settlement of commercial disputes by arbitration and mediation.[8] It also recognizes the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, ensuring that awards made in Nigeria are recognized and enforceable in over 160 member countries.[9] Within this framework, the AMA’s provision aligns with international standards, including the UNCITRAL Model Law, which ensures consistency and enforceability of arbitral awards.[10]

It is against this backdrop that this article examines the legal and practical challenges associated with the enforcement of arbitral awards in Nigeria, arguing that while the legal framework is largely supportive, procedural inefficiencies and judicial attitudes continue to undermine its effectiveness.[11] It further explores the extent to which recent legislative developments have addressed these issues.

The discussion is limited to the enforcement of both domestic and foreign arbitral awards within Nigeria, placing particular focus on the provisions of the Arbitration and Mediation Act 2023 and relevant judicial practices.

This article begins with an overview of the legal framework governing the enforcement of arbitral awards in Nigeria, followed by an examination of the key challenges encountered in practice. It then considers practical solutions and reforms aimed at improving enforcement mechanisms, before concluding with final observations.

LEGAL FRAMEWORK GOVERNING ENFORCEMENT OF ARBITRAL AWARDS IN NIGERIA

Arbitration in Nigeria has experienced significant changes and development over the years. In an attempt to evolve and include emerging areas in arbitration, a new Act was enacted, the Arbitration and Mediation Act 2023.[12] Similarly, arbitral awards in Nigeria, whether domestic or foreign, are enforceable as court judgments under the Arbitration and Mediation Act 2023 and the New York Convention, subject to specific procedural and public policy conditions, reflecting Nigeria’s commitment to aligning with global arbitration standards.[13]

Under the Act, an arbitral award is binding on the parties and may be enforced by the courts in the same manner as a court judgment.[14] This means that once an award is delivered, the successful party may apply to the High Court for its recognition and enforcement.[15] Nigeria also remains a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which involves parties from different countries, with the dispute typically involving multiple legal systems and governed by international conventions or agreements.[16]

Ultimately, in international arbitration, cultural, legal, and linguistic diversity is often prioritized to ensure fairness and acceptance of awards, while domestic arbitration leverages local expertise and familiarity with national laws, customs, and business practices.[17] Thus, arbitral tribunals often consist of arbitrators from different jurisdictions to mitigate bias and ensure balanced decision-making.[18]

The problem lies in the fact that, despite this strong legal framework, enforcement is still largely dependent on judicial processes, which can introduce delays and procedural complications.[19]

ENFORCEMENT OF ARBITRAL AWARD IN NIGERIA

The Act expressly provided that parties to an arbitration agreement can agree on the number of arbitrators to the Arbitral Tribunal; in instances where the parties cannot agree on the number of arbitrators, a sole Arbitrator can be appointed.[20]

In enforcing Arbitral Awards, the Arbitration and Mediation Act requires that the court stay in  proceeding and uphold any arbitration agreement; the court is mandated to refer the parties to arbitration in instances where there is an arbitration agreement.[21] The only exception is if the arbitration is void, operative, and incapable of being performed, when the court orders a stay of proceedings, the court may, for the purpose of preserving the right of the parties, make an interim or supplementary order.[22]

Similarly, section 34 of the AMA provides that the statutes of limitation that apply to judicial proceedings also apply to arbitral proceedings.[23] In calculating the time for the commencement of proceedings to enforce an arbitral award, the period between the commencement of the arbitration and the date of the award shall be excluded.[24]

JUDICIAL ATTITUDE AND CASE LAW DEVELOPMENT

The judicial attitude towards arbitration in Nigeria has evolved, with recent decisions highlighting the extent of support for commercial arbitration.[25] The Nigerian courts have generally demonstrated a pro-arbitration stance, recognizing the importance of party autonomy and the need to uphold arbitral awards in commercial disputes.[26] The courts have repeatedly affirmed that arbitration is intended to provide finality, and as such, arbitral awards should not be interfered with except on strictly limited statutory grounds.[27]

Furthermore, this position is rooted in the principle of party autonomy, which emphasizes the freedom of parties to determine the rules governing their dispute and to be bound by the outcome.[28] The Supreme Court affirmed this position in Mekwunye v. Imoukhuede, where it held that an arbitral award constitutes a final determination of the matters submitted to arbitration, and that courts are enjoined, as much as possible, to uphold and enforce such awards, particularly where parties have voluntarily submitted to arbitration.[29]

Accordingly, courts have consistently maintained that arbitral awards should not be lightly interfered with, except in circumstances such as difficulty in selecting an arbitrator, misconduct by an arbitrator, lack of jurisdiction, or breach of public policy.[30] This approach, however, reinforces the principle that arbitration is not an extension of litigation, but a distinct dispute resolution mechanism whose outcome is expected to be final.[31]  

However, despite this supportive stance, enforcement proceedings often reveal tension between arbitral finality and judicial supremacy.[32] In practice, losing parties frequently attempt to resist enforcement by raising technical objections or framing their challenges as jurisdiction issues. This sometimes results in being drawn into prolonged interlocutory disputes, thereby delaying the enforcement process.[33]

Although Nigerian courts have consistently reiterated that arbitral awards should not be treated as mere recommendations, the persistence of enforcement-related litigation suggests that the practical effectiveness of arbitration remains dependent on judicial efficiency and strict adherence to statutory limits of review.[34]

CHALLENGES OF ENFORCING ARBITRATION AWARDS IN NIGERIA

Arbitration has increasingly become a preferred method of dispute resolution in Nigeria, especially in commercial transactions.[35] However, enforcing arbitration awards continues to pose significant challenges. The Arbitration and Mediation Act (AMA) 2023 governs Nigeria’s arbitration framework and aims to create an efficient and effective system.[36] Despite this legislative effort, parties often encounter numerous obstacles affecting arbitration awards, thereby undermining arbitration’s role as a reliable alternative dispute resolution mechanism.[37]

The difficulties associated with enforcing arbitration awards in Nigeria have far-reaching consequences that impact both parties and the broader legal and economic environment. These challenges include:

Procedural Delays and Loss of Time

One of the most significant challenges in enforcing arbitral awards in Nigeria is procedural delay.[38] Although arbitration is intended to provide a faster alternative to litigation, enforcement proceedings are still subject to the pace of the court system.[39] As a result, successful parties often experience prolonged delays, leading to loss of time and frustration, and undermining the efficiency that arbitration is designed to achieve.[40]

Increased Costs and Financial Burden

Enforcement proceedings can also be financially demanding, as parties are often required to incur additional legal fees and administrative costs in seeking recognition and enforcement of awards.[41] These expenses, when combined with delays, can significantly reduce the cost-effectiveness of arbitration and discourage parties from fully pursuing their remedies.[42]

Impact on Commercial Confidence and Foreign Investment

The combined effect of these challenges is a decline in confidence in Nigeria’s arbitration framework.[43] For both domestic and foreign investors, the reliability of dispute resolution mechanisms is a key consideration.[44] Persistent enforcement difficulties may therefore discourage investment and reduce Nigeria’s attractiveness as a commercial hub.[45]

Implications for the Rule of Law

Finally, ongoing challenges in enforcing arbitral awards may have broader implications for the rule of law.[46] Where court judgments or arbitral awards are not effectively enforced, it can weaken trust in the legal system and raise concerns about the overall integrity of judicial processes[47].

CONCLUSION

This article examined the enforcement of arbitral awards in Nigeria under the Arbitration and Mediation Act 2023. It established that while arbitration is intended to provide a faster and more efficient alternative to litigation, its effectiveness ultimately depends on the ease of enforcing arbitral awards. The analysis revealed that Nigerian courts generally support arbitration and uphold the finality of awards; however, enforcement is still affected by procedural delays, post-award litigation, and occasional judicial inconsistencies, weakening the efficiency of the system.

The study concludes that while Nigeria has a strong legal framework, the effectiveness of arbitral awards ultimately depends on the efficiency and predictability of enforcement in practice. Furthermore, these findings highlight the need for improved judicial efficiency and consistency. Strengthening enforcement mechanisms will enhance confidence in arbitration and support Nigeria’s position as an arbitration-friendly jurisdiction.

RECOMMENDATIONS

To improve the enforcement of arbitral awards in Nigeria, the arbitration framework should be refined to ensure clarity and alignment with international standards, particularly by limiting unnecessary judicial intervention and preserving the finality of awards. Judicial efficiency can also be strengthened through specialized training for judges on arbitration practice, which would enhance consistency and predictability in enforcement decisions. In addition, arbitral institutions should be strengthened through improved case management systems to ensure faster processing of awards. Finally, courts should be empowered to adopt practical enforcement measures, including asset preservation orders, to prevent the frustration of successful awards.

Ultimately, the true value of arbitral awards lies not in their issuance but in their effective and timely enforcement within the legal system.

REFERENCE(S):

L. Abimbola & O. B. Akinola, Court Intervention in Arbitration and the National Policy on Arbitration and Alternative Dispute Resolution 2024 vis-à-vis the Arbitration and Mediation Act 2023: Pathways and Pitfalls, Int’l J. L., Pol. & Hum. Rsch. (2025).10.70382/caijlphr.v8i6.021

[1] M. L. Abimbola & O. B. Akinola, Court Intervention in Arbitration and the National Policy on Arbitration and Alternative Dispute Resolution 2024 vis-à-vis the Arbitration and Mediation Act 2023: Pathways and Pitfalls, Int’l J. L., Pol. & Hum. Rsch. (2025).10.70382/caijlphr.v8i6.021

[2] M. U. Onyirioha, An Evaluation of the Arbitration and Mediation Act, 2023 of Nigeria: An Analysis of Its Impact on Dispute Resolution in Nigeria, 6 Orient L.J. (2025).

[3] S. Kumar, Arbitration: A Streamlined Alternative to Court Litigation, 2 LawFoyer Int’l J. Doctrinal Legal Rsch. 655 (2024).

[4] N. M. Akano & H. Ahmad, Reconceptualising Commercial Dispute Resolution: The Role of Alternative Dispute Resolution in Avoiding Contentious Litigation, 1(2) AEFUNAI L.J. Pub. & Priv. L. (2025).

[5] Gary B. Born, International Arbitration and Forum Selection Agreements: Drafting and Enforcing 1–336 (2021).

[6] C. B. Nwakoby, Use of Alternative Dispute Resolution (Arbitration, Mediation and Negotiation) in Resolution of Marital Conflicts, 10(1) Chukwuemeka Odumegwu Ojukwu Univ. L.J. (2025).

[7] A. A. Oluwabiyi et al., Legal Interventions of the Arbitration and Mediation Act, 2023 of Nigeria, 6(2) Ife J. Human. & Soc. Stud. 15–33 (2024).

[8] D. Shoukat, Resolving Civil-Commercial Disputes Through Mediation in Pakistan: Legal Framework, Sector-Specific Application, and Digital Trends, 3(2) J. Soc. Sci. Archives 10–59075 (2025).

[9] I. Nwakoby & C. Iloka, Recognition and Enforcement of International Commercial Arbitral Award: New York Convention in Focus, 4 IJOCLLEP 147 (2022).

[10] M. S. M. Jain, Emergency Arbitration: An Emerging Paradigm in Dispute Resolution Challenging Traditional Mechanisms, 14(4) J. E.-W. Thought 193–201 (2024).

[11] C. U. Akpuokwe, A. O. Adeniyi, S. S. Bakare & N. E. Eneh, The Impact of Judicial Reforms on Legal Systems: A Review in African Countries, 6(3) Int’l J. Adv. Rsch. Soc. Sci. 850 (2024).

[12] Ibid.

[13] Ibid.

[14] N. Bindal & T. Singh, Correction and Interpretation of Arbitral Awards, 4 Indian J.L. & Legal Rsch. 1 (2022).

[15] N. Alexander & S. Chong, Leading the Way for the Recognition and Enforcement of International Mediated Settlement Agreements: The Singapore Convention on Mediation Act 2020, 34(1) Sing. Acad. L.J. 1–50 (2022).

[16] C. P. Ojiegbe, The Overview of Private International Law in Nigeria, 17(3) J. Priv. Int’l L. 601–618 (2021).

[17] T. K. Alhasan, Linguistic Proficiency Disclosures in International Arbitration: Enhancing Fairness and Efficiency, 38(5) Int’l J. for the Semiotics of Law / Rev. Int’l de Sémiotique Juridique 1805–1827 (2025).

[18] M. Gicquello, Biased or Not Biased? Arbitral Decision-Making and Arbitrators’ Preferences, 13(3) J. Int’l Disp. Settlement 348–369 (2022).

[19] Z. P. Ahdout, Enforcement Lawmaking and Judicial Review, 135(4) Harv. L. Rev. 937–1006 (2022).

[20] B. Harris et al., The Arbitration Act 1996: A Commentary (John Wiley & Sons 2025).

[21] Ibid

[22] J. Tseng, Insolvency of a Party in International Arbitration: Considerations on Staying Arbitration Proceedings, 16(3) J. Int’l Disp. Settlement idaf027 (2025).

[23] Utazi, G. (2024). Appraisal Of The Arbitral Review Tribunal Under The Nigerian Regulatory Arbitration Framework. Available at SSRN 5141771.

[24] Y. Lin, Arbitral Procedures, in China Arbitration Yearbook (2021) 115–131 (Springer Nature Singapore 2022).

[25] A. K. Osinachi, The Role of Arbitration in Resolving Commercial Disputes in Nigeria, Alex-Ekwueme Fed. Univ. Faculty of Law LL.B. Project (2025).

[26] Ibid

[27] D. Nikolić, Agreements Limiting or Expanding Grounds for Annulling International Arbitral Awards, 68(4) Anali Pravnog Fakulteta u Beogradu 30–57 (2020)

[28] . Hassan, Financial Arbitration: Comparative Perspectives on Islamic and Common Law Approaches, J. Bus. Mgmt. & Islamic Banking 199–226 (2025).

[29] Aminat Tijani, Procedural Arbitrability in the Light of the Decision in Mekwunye v. Imoukhuede, 13 NWLR (Pt. 1690) 439 (2019).

[30] U. P. Emelonye & U. Emelonye, Public Policy Exception in the Enforcement of Arbitral Awards in Nigeria, 12 Beijing L. Rev. 266 (2021).

[31] Akano, N. M., & Ahmad, H. (2025). Reconceptualising commercial dispute resolution: the role of alternative dispute resolution in avoiding contentious litigation. Aefunai law journal of public and private law, 1(2).

[32] U. Ojiako, A Constitutional Perspective of the Finality Principle in Arbitration, 15 J. Legal Aff. & Disp. Resol. Eng’g & Constr. 04522030 (2023).

[33] S. Aman, Enforcement of Arbitral Awards and Mediation Settlement Agreements: Navigating Legal and Practical Challenges, 5(3) Pakistan Islam. (An Int’l J. of Islamic & Soc. Sci.) 7–15 (2025).

[34] Ibid.

[35] Ibid.

[36] Ibid.

[37] Ibid.

[38] G. A. Okparaibea & E. G. A. Okparaibea, A Critical Examination of Challenges Facing the Enforcement of Arbitral Awards in Nigeria, 10(2) ADSU Int’l J. Applied Econ., Fin. & Mgmt. (2025).

[39] S. Kumar, Arbitration: A Streamlined Alternative to Court Litigation, 2 LawFoyer Int’l J. Doctrinal Legal Rsch. 655 (2024).

[40] A. A. Abwunza, T. K. Peter & K. Muigua, Explaining the Ineffectiveness of Construction Arbitration, 14 J. Legal Aff. & Disp. Resol. Eng’g & Constr. 04522009 (2022).

[41] G. Bottini, C. Titi, F. P. Aznar, J. Chaisse, M. Jovanovic & O. P. Sola, Excessive Costs and Recoverability of Costs Awards in Investment Arbitration, 21 J. World Inv. & Trade 251–299 (2020).

[42] Ibid.

[43] Ibid.

[44] G. Kaufmann-Kohler & M. Potestà, Why Investment Arbitration and Not Domestic Courts? The Origins of the Modern Investment Dispute Resolution System, Criticism, and Future Outlook, in Investor-State Dispute Settlement and National Courts: Current Framework and Reform Options 7–29 (2020).

[45] N. N. Ninyio, Foreign Direct Investment in Nigeria: Challenges and Prospects, 11 KAS Afr. L. Study Libr. 617–634 (2025).

[46] Ibid

[47] P. K. Bookman, Arbitral Courts, 61 Va. J. Int’l L. 161 (2020).