ICSID may ruin OPL 245 prosecution, CSOs warn World Bank

A coalition of civil society organisations says Nigeria’s efforts to prosecute illicit funds with the OPL 245 deal may be compromised by the International Centre for Settlement of Investment Disputes (ICSID), a member of the World Bank group.

In a letter addressed to David Malpass, the World Bank president and ICSID chairman, the CSOs expressed concerns about ICSID’s “lack of diligence in dealing with serious corruption cases in Nigeria”.

According to the CSOs, ICSID’s actions may affect the global anti-corruption campaign especially since big oil companies are involved in the case.

The petition was titled ‘ICSID: Concerns over (1) lack of clear regulations governing cases involving corruption; and (2) the adjudication of cases where underlying Bilateral Investment Treaties (BITS) do not require compliance with host country law’.

It was signed by Olanrewaju Suraju for Human and Environmental Development Agenda, (HEDA Resource Centre); Bart-Jaap Verbeek, for SOMO; Simon Taylor, Global Witness; Luca Manes, Re-Common; and Nicholas Hildyard, for The Corner House.

The groups warned that a parallel trial of the OPL 245 charges by an ICSID arbitration tribunal, which lacks the clear rules and evidential powers that assist a criminal court, may affect the conclusions reached in Italian and Nigerian courts.

The coalition said ICSID as an institution, should not let cases start when they involve corruption that is being prosecuted or under official investigation adding that some of the affected companies are seeking refuge under ICSID to undermine ongoing court proceedings.

“ICSID should not allow itself to be put into a position where its registration or tribunal rulings undermine the rule of law or development policy on the fight against corruption,” the coalition said.

“Screening out such is essential if ICSID’s reputation (already undermined by its lack of transparency and the conflicts between its arbitration judgments and ICSID’s foundational development objectives) is not to be further damaged. Likewise, with cases where a lack of legality clauses might mean illegal contracts are considered fit for adjudication.

“ICSID should, according to the international coalition, acknowledge the primacy of national courts in trying corruption cases. We would therefore urge that rules are introduced to deny registration of cases where corruption has been proved or suspend registration and/or jurisdiction to cases that are either being prosecuted or under investigation by National prosecutorial authorities, pending the conclusion of such investigation or prosecution. The Eni case is a test of ICSID’s resolve in this regard.

“Since ICSID is part of the World Bank Group, the onus is on the World Bank to ensure that ICSID supports rather than hinders the fight against corruption. Indeed, it would be an affront for the World Bank Group to continue to give secretarial and other assistance to ICSID whilst it remains an avenue through which corruption is rewarded.”

The groups condemned the recent registration of a request by Eni International B.V. (The Netherlands), Eni Oil Holdings B.V. (The Netherlands), Nigerian Agip Exploration Limited (Nigeria) “the Eni companies” for the institution of arbitration proceedings against Nigeria where Eni accused Nigeria of refusing to comply with agreements signed in 2011 to convert an oil production licence for OPL 245 into an oil mining license.

“Should the ICSID proceedings be allowed to go ahead, there is a real risk that deficiencies in the ICSID rules will result in a ruling that conflicts with those of courts in Italy and Nigeria, to the detriment of justice” the coalition stated.

According to the CSOs, investigations by prosecutorial authorities in Italy and Nigeria have resulted in the conviction of two intermediaries in Italy for their role in the deal.

Eni S.p.A is currently being prosecuted in Italy and Nigeria over the deal, Nigerian Agip Exploration Limited is also being prosecuted in Nigeria while The Eni companies (along with other co-defendants) have denied any wrongdoing.