The gale of seizures of Nigeria’s offshore assets by a Chinese company over a trade dispute with a Nigerian constituent is at best a cranky and an infernal assault on the nation’s sovereignty.
The firm, Zhongshan Industrial Investment Company Limited, in an audacious move, recently got three Nigerian presidential jets, two of which were on routine maintenance, grounded in France.
The jets, seized on the orders of the Judicial Court of Paris, included a Dessault Falcon 7X, a Boeing 737 and a newly acquired Airbus A330. The firm, however, released the Airbus as a gesture of goodwill for President Bola Tinubu, especially with his scheduled meeting with his French counterpart, Emmanuel Macron, last week.
The dispute over which the Chinese firm seized those planes was between it and Ogun State, which is merely a sub-national entity. The question is, what is the basis of seizing federal assets over a dispute with a constituent of a country in a federal system? More so, those airplanes are sovereign assets that have diplomatic immunity against legal seizures!
That is the legal conundrum currently racking Nigeria concerning the Chinese firm’s rapacious obsession to corner the nation’s assets over its dispute with Ogun State government. The whole thing, much like the interminable P&ID attempted heist, reeks of subterfuge, international conspiratorial and insufferable mischief.
In March, 2021, an arbitration tribunal, chaired by the former President of the United Kingdom’s Supreme Court, had awarded $74.5 million in favour of the Chinese company for an alleged breach of agreement against Ogun State. In March and August, this year, according to the Presidency, the Chinese company also obtained two orders of the Judicial Court of Paris against Nigeria without notifying both Ogun State and the Federal Government.
“This arm-twisting tactic by the Chinese company is the latest in a long list of failed moves to attach Nigerian government-owned assets in foreign jurisdictions,” the Special Adviser to the President on Information and Strategy, Bayo Onanuga, quipped.
In the Chinese company’s desperation to recover the $74.5million awarded to it by the UK arbitral tribunal, it has also seized two residential buildings belonging to Nigeria in Liverpool, UK. The firm is preparing to sell those buildings, located at 15, Aigburth Hall Road and Beech Lodge, 49, Calderstones Road in the UK city. The company is also moving to confiscate other Nigerian assets in eight jurisdictions, including UK, United States of America, Belgium, Canada, France, Singapore and the British Virgin Island!
What is the crux of the matter? Why is the Chinese firm succeeding in obtaining those court orders, especially after having lost all the four cases it instituted in Nigeria over the same issue?
The facts of the dispute are largely inchoate because there are still suits and counter-suits in various jurisdictions abroad over the matter. The sum total of submissions by Nigerian officials is that the company’s incivility against the country tends to rest on the fulcrum of misinformation, deliberate and surreptitious concealment of facts in most of its suits against Nigeria.
The row stems from a 2007 contract between Zhongshan Industrial Investment Company Limited and Ogun State for the former to build a free trade zone(FTZ), where a massive industrial park was to be developed to attract investors.
Things, however, went awry along the line and the agreement was terminated in the first half of 2016. The Chinese company then resorted to the legal option to reclaim project. Those who sighted some of the court documents said the Chinese claimed that Ogun State violated a 2001 trade treaty between Nigeria and China by abridging its rights to the free trade zone in 2016.
The company dragged Nigeria before the arbitration panel in 2018 in UK, alleging that the country allowed its federal organs such as the police, immigration and export processing authority to be deployed by Ogun State without due process.
The company alleged, in addition, that two of its executives were expelled from Nigeria in 2016, after one of them had allegedly been detained and tortured by the police.
However, former Governor Ibikunle Amosun, during whose tenure the contentious agreement was revoked, refuted the allegation that the state government used security agencies to harass, intimidate or beat anyone.
Amosun said in a statement issued on the matter: “It is not also true that our administration sent police or any security agent to harass, intimidate or beat anyone. If there was any such situation, it must have been from among the disputing rivals in the bid to outdo one another. Security agencies can further investigate the allegation and uphold the truth.”
The former governor said the Federal Government should not give the Chinese company any listening ear or negotiate with it because doing so would be tantamount to encouraging “an unlawful entity without locus standi to appropriate our common patrimony.”
Recalling the genesis of the dispute, Amosun said: “Our administration assumed office on May 29, 2011. Very shortly after we took office, two different sets of Chinese companies, Messrs China Africa Investment FXE and Zhongful (also called Zhongshan) International Investment FXE, laid claims to the management rights over the Ogun Guangdong Free Trade Zone.
“The business dispute and rivalry between the Chinese concerns soon became fierce, grounded seamless business activities and threatened public peace and safety within the zone and neighbouring communities.
“There were claims and counter-claims as to who between the two was the lawful representative of the original venturer, Guangdong Providence, China, and subsequently who had the right to manage the zone.
“Zhongful (Zhongshan) International Investment FXE, pretending to be a concerned and genuine tenant and zone stakeholder, volunteered very damaging and destructive information about the official representatives of Guangdong Province, the joint venturer and lawful zone managers, China Africa Investment FXE, and consequently requested to be appointed as interim zone managers.”
According to the former governor, on March 12,2012, Zhongful (Zhongshan) was appointed an interim zone manager to prevent any unwholesome development in the zone pending the completion of a fact-finding exercise.
However, the state government, Amosun recalled, later discovered that Zhongful’s (Zhongshan’s) claims against China Africa were lies to de-market it and convert state-owned assets of Guangdong Province in China. He said a diplomatic note from the Government of China, dated March 11,2016, confirmed China Africa as the rightful investor.
The former governor, who is now a senator, said after extensive consultations, the state government honoured the request of the Chinese government by returning China Africa and then served Zongful (Zhongshan) International Investment FXE a formal termination notice in May, 2016.
He added that Zhongful (Zhongshan) consequently approached Nigerian courts “to ventilate its legal and business rights,” but the company, according to him, lost all the four cases in court.
The former governor disclosed that a final judgment delivered in Nigeria on the matter on March 29, 2017 described the matter as a trade dispute between two Chinese entities without connection with either Ogun State government or the Federal Government.
“Like every Nigerian,” Amosun added, “we are concerned that a purely business dispute between two Chinese nationals and corporations have degenerated into an unlawful attempt to appropriate Nigeria’s sovereign assets. This is unacceptable to all people of goodwill and must not be allowed to stand.”
Former Governor Gbenga Daniel whose administration initiated the FTZ deal in 2007, in his succinct reaction to the dispute, described the legal conundrum as a sensitive matter involving collective national assets and common wealth, which every Nigerian should be concerned about.
Daniel, who is also currently a senator, said he was ready to provide documents that would help the Federal Government pursue the case against the Chinese firm and assist President Bola Tinubu find “a diplomatic resolution to the national embarrassment.”
The Presidency, commenting on the seizure of the three presidential jets, accused Zhongshan Industrial Investment Company Limited of fraudulent activities and misleading the Judicial Court of Paris in its attempt to claim Nigerian assets.
Onanuga, presidential spokesman, refuted any contractual obligation between Nigeria and Zhongshan, emphasizing that those jets, being sovereign assets, are protected by diplomatic immunity and cannot be legally seized by foreign courts.
He said the ongoing legal issues pertain exclusively to Zhongshan and Ogun State government and not the FG. “Undoubtedly, Zhongshan withheld vital information and misled the Judicial Court of Paris into attaching Nigerian government’s presidential jets which are on routine maintenance in France.”
“The use and nature of the presidential jets as assets of a sovereign entity whose assets are protected by diplomatic immunity forbid any foreign court from issuing an order against them.
“We are convinced that the Chinese company misled the Judicial Court of Paris regarding the use and nature of the assets it seeks to attach and did not fully disclose to the court as required by law. This same Chinese company had tried to enforce its questionable judgment in the UK and USA but failed,” the Presidency posited.
Onanuga said the Presidency is aware of Zhongshan’s attempt to take over Nigeria’s offshore assets through subterfuge, even though the”FG is not under any contractual obligation with the company.”
“The FG is fully aware of efforts being made by the Ogun State government to reach an amicable resolution on the matter. It must be said without equivocation that Zhongshan has no solid ground to demand restitution from the Ogun State government based on the facts regarding the 2007 contract between the company and the Ogun State to manage a free trade zone…
“The material facts in the transaction between the Ogun State government and Zhongshan point to P&ID case in which unscrupulous and questionable individuals falsely presented themselves as investors with the sole aim of undercutting and scamming governments in Africa,” the Presidency submitted.
Like the elders say, it is the cracks in the wall that allow an easy access for the lizard. If former Governor Amosun’s administration had been more circumspect on the FTZ deal, this whole embarrassment would probably not have arisen. Specifically, we are non-plussed as to why the government did not pulse awhile to verify Zhongshan’s alleged “very damaging and destructive information” against its rival, China Africa Investment, before effecting a change that has led to this mess. If that had been done, this implacable foe, Zhongshan, now bent on stripping the nation of its offshore assets in Europe and America, would never have been able to corral a fraudulent stake in the deal.
The truth of the matter is that white elephant projects dot the landscapes today all over the country because many elected political leaders at various levels are always too hasty to discontinue their predecessors’ projects or programmes, however lofty, especially if they belong to opposing political parties and/camps. Rather than complete those projects, they prefer to start and fund their own, thus unnecessarily dissipating resources.
Secondly, like the Federal Ministry of Foreign Affairs has warned, it is incautious for any state government to exclusively initiate and sign deals with foreign investors without involving the the ministry that has the expertise to handle those deals without any negative repercussions. The Ogun case would probably have been avoided if the authorities had done the needful. States are, therefore, admonished to be heedful to the ministry’s guidelines to guard against any unwholesome consequences in future.
In the final analysis, it is reassuring that legal fireworks and diplomatic shuttles are ongoing at the various levels— The Presidency, Foreign Affairs Ministry,Attorney-General of the Federation and National Security Adviser— not only to vacate the questionable court orders seizing the nation’s offshore assets but pull the rug off the feet of the Chinese firm and foe. Our stained sovereignty must be recouped and polished.
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