oil and gas

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THE NIGERIAN OIL AND GAS LOCAL CONTENT REGIME AND ITS (NON-)COMPLIANCE WITH THE TRIMS AGREEMENT

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Uchenna Jerome Orji *

ABSTRACT

One major milestone for the Nigerian oil and gas industry was the enactment of the Nigerian Oil and Gas Industry Content Development Act in 2010. The Act establishes a comprehensive local content regime that enshrines legal measures which promote the patronage of Nigerian products and services by operators in the Nigerian oil and gas industry. This article examines the provisions of the Act and Nigeria’s obligations under the WTO’s Trade Related Investment Measures (TRIMS) Agreement with a view to determining whether the provisions of the Act are in violation of Nigeria’s obligations under the TRIMS Agreement. It also examines whether any exemptions can justify the derogation of Nigeria’s obligations under the TRIMS Agreement. The article finds that requirements under the Act constitute trade-related “investment measures” within the meaning of the TRIMS Agreement because such requirements are explicitly meant to apply to “all operations or transactions” connected with the oil and gas industry. This article also finds that some provisions of the Act are not in compliance with Nigeria’s obligations under the TRIMS Agreement. In particular, sections 10 (1), 11(1), and 12 of the Act which favour the use of local products and materials for projects in the oil and gas industry contravene Nigeria’s obligations under the TRIMS Agreement. The article further identifies exemptions which can justify Nigeria’s application of oil and gas industry local content measures that derogate obligations under the TRIMS Agreement. In this regard, the article suggests that the exemptions under Article 4 of the TRIMS Agreement, which permit a WTO member whose economy is in the early stages of development and can only support low standards of living to temporarily apply local content measures, can be applied by Nigeria to justify the oil and gas industry local content measures under the Act for the purpose of promoting economic development and improving living standards in the country.

* LL.B (Hons.), (University of Nigeria); LL.M (University of Ibadan); PhD (Nnamdi Azikiwe University Nigeria) Barrister and Solicitor of the Supreme Court of Nigeria.

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THE TREASURY SINGLE ACCOUNT AND THE SEARCH FOR EFFECTIVE REVENUE MANAGEMENT IN NIGERIA’S OIL AND GAS SECTOR

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Law Amadi* and Peter Chukwuma Obutte**

ABSTRACT

The Treasury Single Account (TSA) policy was designed to block revenue loopholes, promote transparency and accountability, prevent mismanagement of government’s revenue, unify government bank accounts, improve the processing of payments and collections, and reduce borrowing costs. It aims to ensure complete, real-time information on cash resources and improves operational and appropriation’s control. Despite its clear conceptual aims, its practical implementation has been fraught with several legal challenges and questions. This article examines the concept and historical origin of TSA in Nigeria as well as its application in petroleum revenue management with a view of determining its legality and constitutionality. The article further considers whether the application of TSA had occasioned conflict or confusion between the Federation Account and the Consolidated Revenue Fund as provided under the 1999 Constitution of the Federal Republic of Nigeria, as amended in the aftermath of the reform. It argues that TSA is not an account, but a policy nomenclature directed towards the compliance with sections 80 (1) and 162 (1) of the 1999 Constitution as amended. Although it is currently not provided for in any law or the Constitution, the article insists that the constitutionally recognized accounts for the payment of revenue are the Federation Account and the Consolidated Revenue Fund. TSA is a good and effective policy for the management of petroleum revenue. The article recommends a robust legal and institutional reform to secure its legality, continuity and sustainability. It urges the legislature to review some of the laws and amend the Constitution to entrench TSA in the legal regime.

* LL.B (RSU), BL (Lagos), LL.M (Ibadan), Doctoral candidate, Center for Petroleum, Energy Economics and Law (CPEEL), University of Ibadan, Nigeria.

** LL.B (Ibadan), BL, LL.M (Ife), Cert. Antitrust (Fordham), Sp. LL.M, LL.D (Oslo). Ag Head, Department of Jurisprudence and International Law, Faculty of Law, University of Ibadan

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LEGAL STATUS OF SECTIONS 10 AND 12 OF THE NIGERIAN OIL AND GAS INDUSTRY CONTENT DEVELOPMENT ACT (2010) UNDER THE GATT REGIME

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Adewale Adetola Aladejare*

ABSTRACT

The Nigerian Federal Government in 2010 made a regulatory intervention in the Nigerian oil and gas industry by enacting the Nigerian Oil and Gas Industry Content Development Act (The “Act”). The Act prescribes in sections 10 and 12 that preference should be given to ‘...goods manufactured in Nigeria’. This paper considers the legal standing of these sections in international trade law against the backdrop of the national treatment principle contained in Article III of General Agreement on Tariffs and Trade (GATT). A comparative analysis is made using Article III to establish that the two sections flagrantly violate the obligations of the Nigerian state as a member of the World Trade Organisation (WTO) and GATT. An unexplored contract alternative to legislation argument is then advanced and recommended.

Keywords: Local content, trade, GATT, WTO, national treatment

* Adewale Aladejare, LL.M (UK), LL.B (Ife) is a lecturer at the College of Law, Afe Babalola University, Ado Ekiti.