Contract law and negotiations in Nigeria

What do you need to know about Nigerian business culture?

The people of Nigeria are largely unaware of the ways of the western world. They have their unique understandings and perspectives on how to conduct business. Since there could be a large gap between your business habits and the ones that the Nigerians practice, it may be better to enter the local market with a well versed negotiator or consultant. The Nigerians are simple and straightforward. Their ways of negotiation may seem one sided and unfair though. This is where you will need to use your skills of persuasion and hope for the best!

Nigeria’s political and economic situation

The fact is that Nigeria is a rare option for foreign investment due to economic and political situation. Prolonged periods of regional strife, poverty and lack have weakened the very fabric of the Nigerian tapestry, leaving behind a hopeless situation.

One still needs to see if any real improvements have resulted in transparency and governance. Meanwhile, the country struggles along and those wishing to do business in Nigeria need to be aware of the issues that await them.

What are the right negotiation tactics in Nigeria?

These are some points to consider before negotiating:

  • Expect a lengthy negotiation as time is not a big concern in Nigeria
  • It’s important that you use an intermediary for at least the initial part
  • Contracts are always flexible, be it oral or written
  • Always keep a translator by your side

How much is a contract worth in Nigeria?

Nigerian people usually do not compromise in negotiation. Tricking other party’s into unusual conditions in contracts is a common practice in Nigeria. The contracts between parties are legally bound in Nigeria, but in times of conflict, it is a trend that the government would favor its local party.

What are pricing policy, pressure and restraints in Nigeria?

As Nigeria is mainly an oil economy. This subsequently controls the market prices of most other commodities within the country. A fall in crude oil prices pressure has exerted immense pressure on Nigerian markets.

Another influencing factor is Nigeria’s complex social and political history that has affected every part of the country’s economy and continues to do so.

What is the Nigerian legal system?

Nigeria has a civil law of which one part is English law originating from its colonial rule, and another part is the common law developed after independence.

Apart from these, the Islamic or Sharia Law has been adopted by the following Nigerian states: Zamfara, Sokoto, Kano, Niger, Katsina, Bauchi, Borno, Jigawa, Kebbi, and Yobe. This has triggered a level of fanatical behaviour among these communities, hampering their relations with other communities and nationalities.

What is the arbitration and litigation in Nigeria?


In the events of dispute, commercial arbitration is the best way to resolve in Nigeria. Arbitration is governed by Arbitration and Conciliation Act 1988. The advantages of Arbitration in Nigeria are:

  • Arbitration is a faster way of resolving most of the disputes
  • It lowers the legal expenses and other expenses
  • In the sensitive matters, it ensures privacy
  • It is easier to enforce Arbitration being a foreign investor than the court’s judgment


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