Two Nigerian properties in the United Kingdom are on the verge of being taken over by Chinese investor Zhongshan Fucheng Industrial Investment following an order to enforce a $70 million investment treaty award against Nigeria.
On June 14, Master Sullivan of the Commercial Court in London granted final charging orders over two UK residential properties owned by the Nigerian government, also attaching a £20 million debt related to the high-profile P&ID case. The properties, located in Liverpool and valued at a combined £1.7 million, have been converted to commercial use, outside Nigeria’s diplomatic activities, thus allowing enforcement of the order.
This legal battle saw Zhongshan represented by Withers and barristers at 3VB, while Nigeria was represented by Squire Patton Boggs and a barrister at Atkin Chambers. The underlying arbitration stemmed from a 2013 joint venture with Nigeria’s Ogun State to establish a free trade zone near Lagos. Zhongshan’s subsidiary held a 60% stake, but Ogun terminated its participation in 2016.
In 2021, a London-seated UNCITRAL tribunal chaired by Lord Neuberger, with Matthew Gearing KC and Rotimi Oguneso SAN, found Nigeria guilty of expropriation and other breaches of the China-Nigeria bilateral investment treaty, ordering the country to pay $55.6 million plus interest and costs. Nigeria challenged the award on jurisdictional grounds but later withdrew its challenge.
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Mrs. Justice Cockerill granted Zhongshan an ex parte enforcement order in December 2021, which Nigeria did not contest within the legal timeframe. In July 2023, the Court of Appeal in London upheld the enforcement order, ruling that state immunity did not apply.
Interim charging orders over the Liverpool properties were obtained by Zhongshan in June and August 2022. Master Sullivan rejected Nigeria’s attempts to dismiss these orders, ruling that the properties were leased to residential tenants, with no consular activities taking place. Sullivan also dismissed Nigeria’s claims of improper service and lack of full disclosure by Zhongshan.
Timi Balogun of Squire Patton Boggs, counsel for Nigeria, expressed disagreement with the decision, highlighting complex public international law issues, including state immunity and the rights of a foreign state’s High Commission. Nigeria intends to appeal to higher courts for further consideration of these issues.
Zhongshan has sought enforcement of the award in various jurisdictions, including Washington, DC, where Nigeria’s sovereign immunity defense was rejected, and Quebec, where conservatory seizure of a private jet is being pursued. In the British Virgin Islands, Zhongshan secured an interim attachment over a £20 million liability owed to Nigeria by Process & Industrial Development (P&ID) under an English Commercial Court ruling.
Nigeria’s Ministry of Foreign Affairs has yet to respond to inquiries about this development.