NIGERIA Law and Practice Contributed by: Adedoyin Afun and Michael Abiiba, Bloomfield LP
6.4 Arrest of Vessels Subject to Foreign Arbitration or Jurisdiction Nigerian courts can order the arrest of vessels or other attachments where the relevant claim is subject to a foreign arbitration and/or jurisdic - tion, due to a foreign jurisdiction or arbitration clause. Notably, by virtue of Order 7 Rule 8 of the AJPR, where an application is for a warrant of arrest of a ship or other property in respect of a claim commenced in a court outside Nigeria or com - menced by way of arbitration proceedings (with - in or) outside Nigeria, such an application can be made without commencing an action before the court for the substantive claim. Thus, the FHC has the jurisdiction to entertain an action solely based on obtaining security via ship arrest in claims before a foreign court or arbitration (for - eign and local) proceedings. 6.5 Domestic Arbitration Institutes The Maritime Arbitrators Association of Nigeria (MAAN) is the primary domestic arbitration insti - tute that specialises in maritime claims. Other arbitration bodies that deal with general com - mercial arbitration, including maritime, include the Chartered Institute of Arbitrators UK (Nigeria branch), the Lagos Regional Centre for Interna - tional Commercial Arbitration, the Lagos Multi- Door Courthouse, and the Lagos Court of Arbi - tration. 6.6 Remedies Where Proceedings Are Commenced in Breach of Foreign Jurisdiction or Arbitration Clauses In relation to a foreign jurisdiction clause, the defendant may file an anti-suit injunction in the relevant foreign court. This approach is aimed at ensuring that the party in breach terminates the Nigerian proceedings in favour of proceedings
in the foreign court, as prescribed by the foreign jurisdiction clause. The defendant may apply for a stay of the pro - ceedings before the Nigerian FHC in accordance with the relevant foreign arbitration clause that has been breached and further to the provisions of the AJA and the AMA. If the FHC sees merit in the defendant’s application, it will grant the stay. Where a vessel is under arrest, the FHC may order that the proceedings be stayed on condition that the arrest and detention of the vessel shall stay or be satisfactory security for the release of the vessel for the satisfaction of any award that may be made in the foreign arbi - tration. 7. Ship-Owners’ Income Tax Relief 7.1 Exemptions or Tax Reliefs on the Income of Ship-Owners’ Companies Nigerian law does not have a special tax exemp - tion or tax reliefs applicable to the income earned by vessels. The recent tax demands by the Federal Inland Revenue Service (FIRS) on international shipping companies in Nigerian ter - ritorial waters are more about enforcing compli - ance with existing tax laws rather than introduc - ing new tax reliefs or exemptions. These actions are aligned with the amendments made in the Finance Act, 2023, which necessitates foreign companies, including shipping companies, to provide evidence of income tax filings and Tax Clearance Certificates to operate in Nigeria.
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