Despite US court ruling, FG says presidential jets are immune from seizure

The federal government says presidential aircraft are sovereign assets immune from seizure over a contractual dispute.

The government’s position comes after a US appeal court ruled that Nigeria’s claim to sovereign immunity, in its dispute with a Chinese firm, cannot stand in a commercial venture.

BACKROUND

Recently, a Paris court in France ordered the seizure of three jets belonging to the Nigerian government following an arbitral award to Zhongshan Fucheng Industrial Investment Co. Ltd, a Chinese firm.

The court ruled that the firm should use the three jets at the Paris-Le Bourget and Basel-Mulhouse international airports “as security for its claim of EUR 74,459,221”.

The presidency and the Ogun state government had accused the firm of attempting to fraudulently acquire Nigeria’s offshore assets.

In a statement on Thursday, Kamarudeen Ogundele, a media aide of Lateef Fagbemi, attorney-general of the federation (AGF), said the AGF and national security adviser (NSA) have commenced steps to set the order aside.

“We wish to clarify that, though the dispute originated from engagements of Ogun state government, however, the consequential enforcement actions are being directed against the federal government and its assets in line with extant principles of international law which holds that the actions of a subnational or local entity are attributable to the state or country itself,” the statement reads.

“The Offices of the National Security Adviser and the Attorney-General of the Federation, have already set in motion both legal and diplomatic steps to ensure the discharge of the inappropriate orders against the aircrafts, which are covered by sovereign immunity.

“While further actions are being put in place to resolve the entire dispute through available legal means, the firm position of the Federal Government remains that the aircrafts in question are sovereign assets used solely for sovereign purposes and are therefore immune from attachment as Zhongshan has sought to do.”

ZHONGSHAN FUCHENG VS NIGERIA

In 2010, Zhongshan, through Zhuhai Zhongfu Industrial Group Co. Ltd. (Zhuhai), its Chinese parent company, acquired rights to develop a free trade zone in Ogun state.

A year later, Zhongshan set up Zhongfu International Investment (NIG) FZE (Zhongfu), a Nigerian entity, to manage the project under the permission of the Ogun state government.

However, things took a different turn in July 2016 when the investor accused the state government of abruptly moving to terminate its appointment while attempting to install a new manager for the free trade zone.

Subsequently, Zhongfu initiated an investment treaty arbitration against Nigeria under the bilateral investment treaty between the People’s Republic of China and Nigeria (the China-Nigeria BIT).

The arbitrators had ruled that Nigeria was in breach of its obligations under the China-Nigeria BIT and awarded Zhongshan compensation of around $70 million.

In January 2022, the Chinese company initiated a case to seek enforcement of the arbitration award.

Nigeria pleaded state immunity but was turned away by Sara Cockerill, a high court judge in the UK, who said the country abused the time frame for appealing arbitral awards.