A contract signed between the Ogun State Government under the administration of Senator Gbenga Daniel and a Chinese company, Zhongshan Fucheng Industrial Investment Co. Ltd. may cost Nigeria a fortune. The contract, signed on June 28, 2007 was for the management of a free-trade zone by the Chinese......READ THE FULL STORY>>.....READ THE FULL STORY>>
The Ogun State government was alleged to have granted a 99-year Certificate of Occupancy to the company for over 2,0000 hectares of land in the Zone.
However, the contract was terminated by the immediate past governor of the state, Senator Ibikunle Amosun.
Amosun was alleged to have called for a renegotiation of the contract, which the Chinese declined.
This led to a dispute between the parties in 2015, with arbitration commencing in 2016, with the Chinese country awarded $55.6 million in compensation from Nigeria and $75,000 in moral damages, alongside interest and legal and arbitration fees.
Ogun State’s full statement on the issue
OUR STAND ON ZHONGSHAN’S SUBTERFUGE AND PARIS COURT’S SEIZURE ORDER—-OGUN STATE GOVERNMENT
On 14 August 2024, the attention of the @OGSG_Official was drawn to the provisional attachment of three Nigerian government owned aircrafts in France by the Chinese company, Zhongshan Fucheng Industrial Investment Co. Ltd. (“Zhongshan”).
Ogun State also learned of two orders of the Judicial Court of Paris dated 7 March 2024 and 12 August 2024 respectively, both obtained by Zhongshan without notice being duly given to the Federal Government or Nigeria, Ogun State or their legal counsel. This is the latest in a series of ill-advised attempts by Zhongshan to attach Nigerian-owned assets in foreign jurisdictions, none of which have to date led to the recovery of any sums from Nigeria. Each of the three aircrafts is used solely for sovereign purposes and as such are immune from attachment under international and French law.
In obtaining the provisional attachments, Zhongshan deliberately withheld information from the Federal Government of Nigeria, Ogun State and their legal counsel. Shockingly, it also appears to have misled the Judicial Court of Paris as to the use and nature of the assets it seeks to attach and not made full disclosure to the court as required by law.
Ogun State in conjunction with the Federal Government of Nigeria, has taken swift action to ensure that these provisional attachments are lifted without delay. Just like the P&ID case, this is another unfortunate case of unscrupulous individuals masquerading as foreign investors with the sole aim of defrauding Ogun State and Nigeria.
It should be recalled that the underlying contract between Ogun State and Zhongshan was executed in 2007, 12 years before the present administration, for the management of a free-trade zone. The parties entered into a dispute in 2015 with arbitration commencing in 2016. By 2019, when the current State Administration took office, the hearing at the arbitration had been all but concluded. The Arbitral Panel awarded over 60 million USD against the Federal Government of Nigeria (FGN) which was a co-Defendant, when all Zhongshan had done was to build a perimeter fence around the free-trade zone.
Needless to say this was a bad/unfair decision. The present State Administration could not in all good conscience allow such an unconscionable and baseless decision, which would dissipate the commonwealth of the good people of Ogun State, to stand. Accordingly, and based on erudite legal advice, this Administration resolved to resist the enforcement of the award.
The resistance was successful in 8 different jurisdictions. Currently, there are pending appeals against recognition orders issued in both the US and UK. On the further advice of counsel, Ogun State also engaged Zhongshan in settlement discussions on reasonable terms. The last meeting attended by several officials of Ogun State, including His Excellency Prince Dapo Abiodun – the Governor of Ogun State, and the Honourable Attorney General/Minister of Justice lasted for three days, in September 2023 in London. Zhongshan’s initial reasonable readiness to consider Ogun State’s offer, was surprisingly reversed by the second day, with an insistence on the payment of the full debt.
This led to a breakdown of the mediation, with parties agreeing to meet again in the first quarter of this year. Since then, Zhongshan has in bad faith been evasive and instead embarked on a series of enforcement proceedings which the legal team appointed by the FGN and Ogun State have successfully opposed. In cases similar to the present one where Zhongshan obtained an ex-parte order, Ogun State has successfully set aside the orders.
We naturally regret any embarrassment this has caused the Federal Government of Nigeria, HE President Asiwaju Bola Tinubu, GCFR and the good people of Ogun State and re-affirm our commitment to constantly and consistently protect the integrity of the nation and its assets. We have taken all necessary legal steps to ensure that this spurious and baseless order is vacated within the shortest possible time.
As a sovereign nation, whose assets are protected by laws of sovereign immunity, we vow to resist any attempts at blackmail and theatrics clearly designed to extort and embarrass our dear country. It is important to note that Ogun State never gave up on a reasonable settlement option, with the most recent letter sent to Zhongshan, last week. Unfortunately, Zhongshan only responded after obtaining this latest order.
A reasonable and objectively quantifiable settlement figure has always been our preference and continues to be an option in the resolution of this protracted dispute.
