Nigeria has called on the United Nations to evolve reforms that will protect national sovereignty in arbitration disputes between investors and member-states.
The country advocated reforms that would reinforce rather than bypass domestic courts in Investors-States Disputes Settlement (ISDS).
Attorney General of the Federation and Minister of Justice, Prince Lateef Fagbemi (SAN), stated this position yesterday during the heads of delegations roundtable at the Chief Legal Advisors Forum (CLAF) 2026 in Singapore.
He said the ISDS reforms sought would address the inadequacies and imbalances in legal framework in order to protect investments and country’s taxpayers.
The AGF, while commending the forum convened by the Ministry of Law of Singapore, said as global investment flows evolve and states confronting new development challenges, the need for a modern, balanced, and credible dispute-settlement system had never been more urgent.
The minister said upon assuming office, he had taken some steps to address the challenges by constituting a committee of experts to review Nigeria’s bilateral treaties and Nigeria’s commitment under multilateral treaties and conventions in order to promote and protect investments in Nigeria.
He said Nigeria became a strong proponent for clarity concerning calculation of damages because of the experience in the Process and Industrial Developments Ltd. (PandID) case which would have crippled the nation’s economy.
‘States consistently express concern about the opacity of arbitral proceedings and the unpredictability of awards. Nigeria continues to support reforms that enhance transparency of proceedings, consistency in arbitral reasoning, and predictability in outcomes. These elements are essential for investor confidence and state trust alike. That is why Nigeria is a strong proponent for clarity concerning calculation of damages. The current position largely relies on the whims of each arbitrator or tribunal. For example, in the notorious case of PandID, damages were calculated on the basis of compound interest, which would have had a crippling effect to the tune of billions of dollars.
‘It is with this belief that Nigeria reformed its Arbitration Act to reflect the importance of transparency. There is growing openness to fresh approaches beyond traditional arbitration,’ he said.
The minister said states had acknowledged that ISDS reform was not optional as It was essential for maintaining the legitimacy of the international investment regime.
‘Nigeria sees this consensus as a positive development: it signals that the global community understands the need for recalibration to ensure fairness, predictability, and development alignment.
‘Many states, Nigeria included, believe that incremental adjustments will not address the structural imbalances embedded in the current system. There is increasing support for systemic reform, including clearer treaty standards, improved procedural safeguards, stronger accountability mechanisms, and more balanced rights and obligations for investors and states. This reflects a desire for a dispute-settlement system that is durable and future-proof.’
Fagbemi said Nigeria saw significant value in the innovations, particularly in reducing costs, preventing escalation, and strengthening cooperative problem-solving.
‘Strengthening national judicial institutions is central to building long-term rule-of-law capacity and reducing over-reliance on external arbitration,’ he said.