THE ROLE OF ARBITRATION IN RESOLVING COMMERCIAL DISPUTES IN NIGERIA

Abstract

This research critically examines the role of arbitration in resolving commercial disputes in Nigeria. Arbitration has evolved as a preferred mechanism for dispute resolution due to its efficiency, confidentiality, and finality. In Nigeria, arbitration is rooted in customary practices but formalised under statutory law, beginning with the Arbitration Ordinance of 1914 and culminating in the Arbitration and Mediation Act 2023, which modernises the framework in line with international best practices. The study Investigates the effectiveness of arbitration in Nigeria, highlighting both its advantages—such as reduced court congestion and party autonomy—and its challenges, including judicial interference, inconsistent enforcement of awards, high costs, and limited institutional capacity. It also analyses relevant case law, the institutional framework (e.g., Lagos Court of Arbitration, NICArb), and international influences like the New York Convention and UNCITRAL Model Law. Using a doctrinal and comparative methodology, the research draws insights from other jurisdictions, particularly the UK, US, and Singapore, to evaluate Nigeria’s arbitration practice. Findings reveal that while Nigeria has made significant progress in aligning with international standards, challenges in enforcement, judicial attitude, and institutional growth hinder arbitration’s full potential. The study concludes with recommendations for strengthening arbitration in Nigeria through legislative reform, institutional development, judicial training, and greater public awareness. Ultimately, arbitration remains indispensable for enhancing investor confidence, promoting economic growth, and positioning Nigeria as a regional hub for commercial dispute resolution.