Law digest vol 6 autumn 2014 by Seyi Clement

LAW Issue 6

Digest Africa’s Premier Law Journal

Autumn 2014

George Etome

Visionary Business Lawyer and a perfect gentleman

Regulation and capacity holding back growth of law firms in Africa

Focus on Uganda Mini-skirt police – Ugandan style Overview of the Nigerian Capital Market The sentencing in Advance Fee fraud cases in Nigeria – A critique The fight against illicit financial outflow from Africa: why a global solution is necessary

UK: £3.50 US: $5.50 Nigeria: ₦1,000 www.nglawdigest.com

Law Digest Autumn 2014

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Contents

ISSN 2053-3209

PUBLISHER

XL Nominees Limited 1st Floor, 3 Market Place Broadway Kent, UK. DA6 7DU TEL: +44 20 3223 0805 FAX: +44 20 3538 9309

EDITOR

LEGAL ADVISORS

Augustine Clement 1st Floor, 3 Market Place, DA6 7DU, UK Bisi Iyaniwura & Co 3rd Floor, Arinkandi House 1 Raimi Adedokun Drive Lagos

Seyi Clement editor@nglawdigest.com

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SUBSCRIPTIONS, ADVERTISING AND EVENTS UK Aninder Dhillon Tel: +44 203 223 0805 sales@nglawdigest.com MIDDLE EAST John Adetiba johnadetiba@yahoo.com NIGERIA Yinka Olojede-James linksj1@hotmail.com Ranti Thomas Lawthomas81@yahoo.co.uk Adijat Ayobami kdjbukky@yahoo.com

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34 REGULATION AND CAPACITY HOLDING BACK GROWTH OF LAW FIRMS IN AFRICA

A report on the research into the state and prospects for the African legal services market. As part of our research we surveyed over 200 senior African lawyers to elicit their views on the future prospects for the continent’s legal services market. This is the first and largest survey of its kind ever conducted across African jurisdictions. The results were encouraging, with many bullish about the future. 73.17% of respondents believe that the quality and quantity of instructions will grow over the next 2 to 3 years and 69.72% see a brighter future prospect for their firms. These figures seem to mirror the growth in the continent’s economy and the re-emergence of the middle class with significant disposable income. Despite the bullishness of the firms and the undeniable economic indicators, which both show upward trajectory, some common and worrying themes emerged from the survey, which should concern the African regulators, policy makers and legal education providers.

COVER STORY 48. An exclusive Interview: George Etomi of George Etomi & Partners, Nigeria.

CONTRACT LAW 22. Is good faith and fairness or Ubuntu a contractual term in South Africa?

4. From the Editor 5. News 8. Case Review and development 32. Event Gallery 60. Focus on Uganda

CAPITAL MARKET 24. Overview of the Capital Market.

legal

COMMERCIAL LITIGATION 10. The fight against illicit financial outflow from Africa: why a global solution is necessary

Nigerian

CONSTITUTIONAL LAW 30. Mini-skirt police – Ugandan style

INTELLECTUAL PROPERTY RIGHTS 40. Domain Name hijacking, domain name disputes resolution and the entertainment industry in Africa- A strategic approach to brand management

TAX 18. Transfer pricing in Ghana and Nigeria

CRIMINAL LAW 56 The sentencing in Advance Fee fraud cases in Nigeria – A critique

AVIATION LAW 14. Recent development Aviation Law in Nigeria

FROM THE EDITOR

Law Digest Autumn 2014

Dear Colleagues, Welcome to our 6th issue. In this issue, we report on our research into the state and prospects for the African legal services market. As part of our research, we surveyed over 200 senior African lawyers to elicit their views on the future prospects for the continent’s legal services market. This is the first and largest survey of its kind ever conducted across African jurisdictions. The results were encouraging, with many bullish about the future. 73.17% of respondents believe that the quality and quantity of instructions will grow over the next 2 to 3 years and 69.72% see a brighter future prospect for their firms. These figures seem to mirror the growth in the continent’s economy and the re-emergence of the middle class with significant disposable income. Despite the bullishness of the firms and the undeniable economic indicators, which both show upward trajectory, some common and worrying themes emerged from the survey, which should concern the African regulators, policy makers and legal education providers. We have also introduced a new section focusing on the various African jurisdictions, starting with Uganda. With this section, we hope to examine the structures of the legal services market of each of the African jurisdictions, looking particularly at the opportunities and challenges. In the next issue, the focus will be on Ghana. You have nominated George Etomi of George Etomi & Partners as this issue’s Lawyer in the News. George Etomi has worked tirelessly for the development of business law practice in Nigeria, an effort recognised in Nigeria and internationally.

Law Digest - Expanding Minds 4

On another note, we are hosting the 2nd annual International Litigation and Asset Recovery Forum, on 4th November 2014, in Lagos, Nigeria. This is a must-attend event for lawyers specialising in fraud litigation, debt recovery and insolvency litigation. Why not come and network with forensic accountants, insolvency practitioners, in-house lawyers, risk analysts and heads of financial crime departments from banks and other financial institutions and other recovery specialists. This year’s Forum is supported by Eversheds LLP, Olaniwun Ajayi LP, Akin Delano LP, Great James Street Chambers, Peters & Peters Solicitors LLP, Berwin Leighton Paisner LLP, Skye Bank and Wema Bank to mention but a few. To find out more visit our event website at www.nglawdigestevents.com. To contribute articles or commentaries, please write to me at editor@nglawdigest.com. We particularly welcome contributions from our eastern and southern African colleagues. We hope that you will enjoy this issue. We welcome your contributions, comments, criticism and support. Yours,

Seyi Clement Publisher/Editor

News

Law Digest Spring 2014

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Sasol Chemical Industries feels the wrath of South Africa’s Competition Tribunal

n Thursday 5 June 2014, the Competition Tribunal (the “Tribunal”) announced that it has imposed an administrative penalty of R534 million on Sasol Chemical Industries Limited (“SCI”), a subsidiary of Sasol Limited (“Sasol”), for charging excessive prices for propylene and polypropylene in contravention of section 8(a) of the Competition Act, No. 89 of 1998 (the “Competition Act”). Section 8(a) of the Competition Act prohibits a dominant firm from charging an excessive price that is to the detriment of consumers. The Competition Act defines an excessive price as “a price for a good or service that – a. “bears no reasonable relation to the economic value of that good or service; and b. is higher than the value referred to in (a).” Relying on the decision of the Competition Appeal Court in Mittal Steel South Africa and others v Harmony Gold Mining Company and Another, the Tribunal adopted a multi-stage test to the excessive pricing inquiry, by determining i) the actual price charged

for the products; ii) the economic value of the products; iii) whether the difference between the actual price and the economic value was unreasonable; and iv) if so, whether the charging of the excessive price was to the detriment of customers. The Competition Act itself does not define the term “economic value”. In order to determine the economic value in this case, the expert economists used a variety of tests, such as pricecost tests, comparative pricing with other geographic markets, and comparative pricing of SCI’s import and export prices for each product. Employing these tests, the Tribunal found that SCI had indeed charged prices in excess of the economic value of the products. The Tribunal then considered the question whether the prices bore a “reasonable relation” to the economic value of each product. It considered a variety of factors in this regard, including the objective of the Competition Act to reverse economic exclusion and high levels of concentration; the importance of the products as intermediate

inputs in industrial development; the history of state support and protection provided to Sasol through legislation and regulation; and the reasons for SCI’s cost advantage in the production of purified propylene and polypropylene (namely, that feedstock propylene is produced in abundance as a byproduct of Sasol’s liquid fuels production). Based on the forgoing considerations, the Tribunal concluded that the prices charged by the SCI for purified propylene and polypropylene during the relevant period bore no reasonable relation to the economic value of the products. Turning to the last stage of the test, the Tribunal found that the excessive prices charged had a detrimental effect on customers. In this regard, the Tribunal found, in respect of purified propylene, that the prices charged had been detrimental to Safripol Proprietary Limited (“Safripol”), SCI’s only domestic purified propylene customer, and had prevented it from competing effectively with SCI in the downstream market for

Sasol garage in South Africa

polypropylene. Moreover, SCI’s excessive prices for polypropylene had a significantly detrimental effect on local plastic converters. With regards to remedy, whilst the Competition Commission (the “Commission”) sought the imposition of a maximum penalty of 10% of turnover, the Tribunal decided on a reduced administrative penalty, together with a “forward looking” behavioural remedy. Accordingly, the Tribunal imposed – In respect of purified propylene, • a R205.2 million penalty; and • an order – i) requiring SCI not to discriminate between the purified propylene

price charged internally to Sasol and that charged to customers such as Safripol, and ii) jointly with the Commission to submit to the Tribunal within 90 days a proposed pricing remedy that meets certain requirements. • In respect of polypropylene, (1) a R328.8 million penalty; and an order requiring SCI to sell polypropylene on an ex-works basis, without discriminating in price between any of its customers, regardless of their location.

Alegeh wins NBA election, to become 27th president of the Nigerian Bar Association which Thetook election place on

Tuesday July 15, 2014 in Abuja had five candidates running for the office of the President namely, Dele Adesina, SAN, Augustine Alegeh, SAN, Olufunke Adekoya, SAN, Adeniyi Akintola, SAN and Osas Erhabor. Alegeh won the race with a total of 691 votes. His runnerup, Dele Adesina, SAN had 370 votes, Funke Adekoya, SAN 255 votes, Niyi Akintola, SAN 126 votes and Osas Erhabor, 17 votes. At his inaugural speak delivered to a packed audience at the 54th Annual General Conference held in

Enugu, Imo State, Alegeh outlined his agenda for the presidency. In a speech which suggests that constitutional reforms will play a significant part in his tenure, the President, called for further reform of the Association’s constitution to address the cost of running NBA elections, promote better co-ordination of the National Executive Committee’s business and expand the E-voting process. In recognition of the perennial dispute between the national and branch levels of the Association over allocation of Bar Practice Fees, Alegeh promised

to look into increasing the level of Branch retention. The President also promised to look into the appointment process within the NBA to ensure fairness and transparency. The President expressed his dismay that appointment to the Boards, Commissions and Parastatals on which NBA is or ought to be represented remains shrouded in secrecy. He announced the setting up of an ad-hoc Committee to look into the matter and present a report on or before the end of October, 2014 His speech was not without its dose of populist measures,

as he made clear that the welfare of NBA members would be given high priority in his administration. He promised to propose to the NEC a 10% reduction across board in respect of Bar Practising fees for all Lawyers excluding Senior Advocates and a 40% reduction in the fee for the 2015 Annual General Conference. The President also confirmed that the Association has received offers in principle from partners to offer hotel & airline discounts and soft loans to NBA members. Controversially, the President raised concerns regarding the decision of the Supreme

Court of Nigeria in Akintokun v. LPDC SC/111/2006 which he believes has adversely affected the work of the Legal Practictioners Disciplinary Committee. He promised to engage the Honourable Attorney General and Minister of Justice to find a quick solution to the issue. He also wadded into the election disputes at the branch and Section levels. Consequently, he announced the appointment of Mr. Jide Koku, SAN as the Interim Chairman of the Section of Legal Practice with a mandate to run the Section until proper elections are held within six months.

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The South African OTC derivatives market comes of age I

n terms of South Africa’s commitment to the G20, the government is required to implement procedures for the regulation of unlisted over-the-counter (OTC) derivatives. On 4 July 2014, the National Treasury, Reserve Bank and Financial Services Board released draft regulations for public comment, in the

government’s next step to fulfil this requirement. The draft regulations provide for central clearing and trade data reporting, as well as the regulatory regime that will govern central counterparties and trade repositories. In particular, the draft regulations provide: 1. for licencing of OTC derivative providers in

terms of the Financial Markets Act (FMA); 2. for reporting of OTC derivative transactions by licenced OTC derivative providers to a South African licenced trade repository or a recognised external trade repository; 3. for clearing of OTC derivative

transactions cleared through a central counterparty; and 4. the functions and duties that may be undertaken by nonSouth African clearing houses, central counterparties, and trade repositories. The draft regulations are intended to, among other things, ensure that all OTC derivative

providers are authorised as a category of regulated persons, and that all central counterparties are sound and resilient. A stated aim is to promote transparency of the derivatives markets through regulations applicable to the licencing of trade repositories. Comments on the draft regulations are due on 3 September 2014.

Kenyatta under pressure from investors I

nvestors have increasingly pressured the Kenyan government to implement a clear fiscal and contractual regime and to open up new acreage for investment. The schedule for proposed legislation was first promised in late 2012 and, despite the new deadline, is likely to face further delays due to internal political disputes and external political pressures on the ruling Jubilee Coalition of President Uhuru Kenyatta. This will delay new licensing in oil and gas, as well as investment in existing license areas. Parallel legislative processes for mining and for natural resource revenue sharing are also likely to delay the passage of the petroleum law. On 18 July, the government announced that parliament was to introduce a new mining law aimed at giving government ownership of mineral resources and

enhancing transparency in the sector. The Energy Bill, which has specific provisions for the oil and gas sector, is also due for passage through parliament, but faces further delays. The sector is currently governed by the Petroleum (Exploration and Production) Act 1986 and the related regulations and model production-sharing contract; the Income Tax Act 2012 and relevant Finance Acts; and the 2010 constitution. Amendments to Kenya’s Petroleum (Exploration and Production) Act 1986 were tabled in October 2013; however, progress has been delayed. Parallel to the review of the Petroleum Act, the Energy Bill was produced, with a first draft appearing in March 2013; it is now in its fifth iteration. The Energy Bill covers upstream elements also covered by the Petroleum Act – resource

management, granting of licences, operations and oversight of the sector. It also covers extraneous issues such as revenue management. A Mining Bill has also been in development since 2013, an area also covered by the Energy Bill. More recently, the minister has promised a new Petroleum Bill to be presented to parliament this month or next and passed by October. The Ministry of Petroleum, in a recent statement, said it has been in preparation since March this year, led by the Inter-Ministerial Technical Committee. It is unlikely that new legislation will be ready in time to allow for new licensing. Cabinet Secretary Chirchir has stated that there are 15 new oil blocks to be allocated, drawn from relinquished acreage. Continued delay in clarifying procedures for awarding licences and clarifying the fiscal regime will require navigating informally,

President Uhuru Kenyatta of Kenya

so exposing investors to possible demands for bribes from public officials. The interim period will also expose investors to increased risk of contract renegotiation or cancellation, especially for investors aligned with certain political interests. In February 2014, Cabinet Secretary Chirchir revoked the licences held by Canada’s Vanoil Energy

for Blocks 3A and 3B located in Garissa. Chirchir claimed Vanoil had failed to carry out basic work requirements in accordance with the production-sharing contract (PSC) it signed with the government in 2007. Proposals drawn up by World Bankfunded consultants are likely to form the basis of any new legislation, but will not necessarily inform all aspects of it.

some senior government officials towards the disclosure requirement. Sirleaf replaced Executive Order No.38 with No.55 establishing a new Code of Conduct for public servants. However, corruption is on the increase in Liberia’s public sector. The country was ranked 83 out of 177 in Transparency International’s Corruption Perceptions

Index 2013, dropping eight places. In 2012, Liberia was regarded as the third least corrupt country in West Africa after Cabo Verde and Ghana. In February 2014, LACC opened an investigation into allegations that the National Oil Company of Liberia (NOCAL) had offered “bribes” to lawmakers to pass new oil legislation.

Ellen Johnson Sirleaf on war path T

he Liberian President, Ellen Johnson Sirleaf threatens senior government officials, including ministers, with sanctions of a month’s suspension and forfeiture of a month’s salary “for failing to file their Income, Assets, and Declaration”. This new measure came following the submission of a list of defaulting officials who failed to declare their assets by the Liberia Anti-

President Sirleaf, Liberia

Corruption Commission (LACC). Sanctions of a month’s suspension and loss of a month’s salary is President Ellen Johnson Sirleaf’s new stance as part of her administration’s broader plan to stamp out corruption in the public sector with the help of LACC. In a Press Release issued in July 2014, the Presidency voice frustration with the lackadaisical attitude of

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The fight against terrorism will be UK Companies face prosecution for failing to prevent conducted within the rule of law - economic crime - Jeremy Wright, QC to remain anonymous Speaking at the and develop new ways to Mohammed Bello Adoke, SAN. described the scenario as Cambridge Symposium expose and combat it. The

Mohammed Bello Adoke, SAN - Attorney General of Nigeria

ohammed Bello Adoke, SAN, the Attorney General of Nigeria assured audience at the recently concluded conference on “Terrorism in Nigeria”, hosted by the British Nigerian Law Forum and Hospital & Prison Action Network in London on the 14th of June 2014. He reiterated that the his office is particularly conscious of the need to fight terrorism within the confines of the law and due process, especially in line with the constitutional guarantees and procedures relating to fair hearing provided by sections 33 to 36 of the Nigerian Constitution. The Honourable Attorney General emphasised that the seemingly draconian enforcement measures contained in the Terrorism (Prevention) Act 2011 (the “Act”) are both necessary and proportionate in dealing with the crime of terrorism. He acknowledged that one of the greatest constraints

in the dispensation of justice in Nigeria is the vexatious issue of prolonged trials, which is caused by systemic, as well as other factors extrinsic to the court system. He however confirmed that the Act has taken due congisance of this problem by making provisions that empower the court to reduce delays where they cannot be avoided. Other measures announced by the Adoke, include capacity building in the Ministry of Justice and the Judiciary to develop expertise in dealing with terrorism cases. He also announced measure to assist with witness protection and the development of sentencing guidelines to bring consistencies in the sentencing regime. He confirmed that there are still challenges including but not limited to security of judges handling terrorism cases, which has led some judges to decline to handle some terrorism case.

on economic crime held on the 13th of August 2014, Jeremy Wright, the UK AttorneyGeneral, announced that the government is considering widening criminal liability for the corporate world through the creation of an offence of a corporate failure to prevent economic crime, in a move that would significantly increase the reach of the Serious Fraud Office, according to its director David Green. At present, companies can be prosecuted for failing to prevent bribery under the Bribery Act 2011. Separate rules due to come into force in October will see firms fined as much as 400% of any profits accrued from bribery. My Wright opined that, “the evolving nature of economic crime means we need to continue to find

Government is therefore considering proposals for the creation of an offence of a corporate failure to prevent economic crime”. In a new twist, the director of the economic crime command at the UK’s National Crime Agency (NCA), Donald Toon, has warned professional services firms that they will face investigation should they “enable” organised crime with their services. Mr Toon said a plan would be formulated by the end of the year on how to tackle “professional enablers” but action by both the NCA and the solicitors’ regulator could happen sooner. The significance of these developments is not lost on the law firms with exposure to African transactions. A partner of a firm in the City of London who wishes

nightmarish. He said his firm is already carrying out extensive due diligence on potential clients, but in future, this due diligence process will need to be extended to the transactions as well, for greater assurance of the legitimacy of the transaction. He opined that even that may not be enough, as in some cases, whilst the transaction itself may be legitimate, the proceeds of the transaction could be diverted unlawfully, which could still leave the firm exposed. He expressed concerns that the due diligence r e q u i r e m e n t s could lengthen the transaction time and increase cost, which could drive transactions to other jurisdictions with less stringent requirements.

Mozambican parliament introduce clarity in the oil and gas sector

he Mozambican p a r l i a m e n t approved on 14 August a proposal to revise the 2001 Petroleum Law, paving the way for the promulgation of the law by the President, most likely on 21 August. The new code gives the state control of “production, transport, marketing and transformation” of hydrocarbons through

state oil company Empresa Nacional de Hidrocarbonetos de Mocambique (ENH), and aims to promote local ownership and participation. The bill, which has been in preparation since 2012, also includes provisions to promote transparency in the sector, including the public disclosure of

tenders for contracts to supply goods and services to the sector and public disclosure of the “main terms” of contracts. Moreover, the code stipulates that 25% of the oil and gas production should be earmarked for the domestic market as part of wider efforts to maximise social and economic benefits for the country.

Law Digest Autumn 2014

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Case Review and Legal Development From the Research Desk

NIGERIA

Insurance Law Interpretation Illegality Condition Precedent Pleadings Amendment Corporate Ideal Insurance Limited –v- Ajaokuta Steel Co. Limited & 2 Ors - 2014 (2)LEDLR - 10 SUPREME COURT (FABIYI; RHODES-VIVOUR; PETERODILI; MUHAMMAD; OKORO, JJ.SC) The Appellant, an insurance company, agreed to provide insurance cover for the 1st Respondent’s equipment from 1996 to 2000 with a further agreement that the premium will be paid at a later date. The Appellant demanded payment of the premium, the 1st Respondent however failed to pay stating that it had no money. The Appellant instituted an action at the Federal High Court, Abuja claiming inter alia, the sum of ₦226,000,000 (Two Hundred and Twenty Six Million Naira) being the unpaid insurance premium. The 1st Respondent admitted that it owed the Appellant the sum claimed but that the federal government had not released funds to it. The Appellant applied for judgment based on the above admission. Judgment was entered against the 1st Respondent. Aggrieved, the 1st Respondent appealed to the Court of Appeal and raised the issue of the illegality of the insurance contract. The Court of Appeal unanimously set aside the trial court’s decision. Dissatisfied, the Appellant further

appealed to the Supreme Court. One of the issues for determination before the Supreme Court was: “Did the purported violation of Section 50 and 93 of the Insurance Act No. 2 of 1997 by the Insurance Contract between the parties render the said Insurance Contract unlawful, illegal, null and void?” Counsel to the Appellant argued that section 50(1) of the Insurance Act is intended to protect the insurer and merely relates to the contractual validity of the insurance cover. It contended that the section is more concerned about the validity of the contract than its illegality. Furthermore, where the condition precedent to a valid insurance contract is not met, then the insurance contract will be invalid and not illegal. Further, the Appellant argued that the statutory protection provided in section 50(1) of the Insurance Act may be waived by the insurance company, and the Appellant validly waived its right. Regarding section 93(1) of the Act, counsel to the Appellant further argued that if the Respondents sought to avoid the contract on the ground of lack of consent of the Head of State, they have the onus to prove this contention. Counsel stated that the 1st Respondent had the duty to comply with section 93(2) by obtaining the necessary waiver and not the Appellant. Counsel to the 1st Respondent argued that a contract is illegal where its formation or performance is expressly prohibited by a civil or criminal statute or where penalty is imposed for doing the act agreed upon. The 1st Respondent further argued that a contract could be illegal even where there is no sanction imposed. Section 50(1) of the Insurance Act prohibits entering into any insurance contract without the premium having first been paid and that non-compliance renders the contract illegal and unenforceable. Further, it was submitted that the

word ‘shall’ in section 50 (1) of the Act shows that the provision is mandatory and cannot be waived. The 2nd and 3rd Respondents argued along the same lines as the 1st Respondent. The Supreme Court unanimously dismissed the appeal agreeing with the finding of the Court that the insurance contract illegal and therefore unenforceable. The court said as follows: “A proper resolution of this issue turns on the construction or interpretation of Sections 50(1) and 93(1) and (2) of the Insurance Act, 1997. The appellant had contended that non-compliance with Section 50(1) of the Act renders the contract of insurance invalid and not illegal whereas the respondents think otherwise. For ease of reference, let me bring to the fore, the said provision. Section 50(1) of the Insurance Act provides: ‘The receipt of an insurance premium shall be a condition precedent to a valid contract of insurance and there shall be no cover in respect of an insurance risk, unless the premium is paid in advance.’ Clearly, the above provision means no other thing than what it says. There shall not be any valid contract of insurance until and unless the premium is paid in advance. In other words, payment of premium is a condition precedent to a valid contract of insurance. It is trite that a cardinal rule of interpretation of statute is that where the `words of a statute are clear and unambiguous, the courts are to give them their plain and ordinary meaning. It does not require any special or cannon of interpretation. This has been the position of this court in several decided cases. See Egbe v. Yusuf (1992) NWLR (Pt. 245) 1, Olarenwaju v. Governor of Oyo State (1992) 11/12 SCNJ. 92.”

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SOUTH AFRICA

Labour Law Employment Equity Act 1998

Amendments to the South African Employment Equity Act (“EEA”) came into force on 1 August 2014 and new employment equity regulations were published on the same day (effective immediately). They raise important issues of practical consequence for employers and employees. Affirmative action The controversial proposed mandatory formulae for how national and regional demographics should be applied in setting affirmative action goals and measuring compliance have been dropped. Other important affirmative action matters arising from the new regulations, include: • There are a range of new template formats which must be used by designated employers to capture their compliance with various duties. For example, there are new forms for: • capturing the mandatory analysis of employment policies, practices and procedures (EEA12); • an employment equity plan (EEA13); and • employers under review by the Director General, who will be expected to complete a new review assessment form (EEA7), which also describes the documents that the employer is expected to provide in a review process. This is an important indication to employers of the records that they should keep available for submission if they have a DG review. • Regional demographics is defined to mean the relevant provincially economically active population (previously there was uncertainty as to whether regional meant provincial or something narrower or wider). • Employees or applicants for employment with disabilities have the right not to declare their disability, unless it is ‘in line with the inherent requirements of the job’. • There is now a duty on employers to retain their employment equity plan and their employment equity report

for 5 years. • For designated employers who form part of a group of companies, there is still scope for consolidated reporting but subject to some conditions, e.g. there must be a consolidated employment equity plan supported by individual plans for each registered entity and this method of reporting must remain consistent for the duration of the plan. • There is a new obligation on designated employers to inform the Department in writing immediately of any changes to their trade name, designation status, contact details or any other “major changes”, including mergers, acquisitions and insolvencies. • Employment equity reports are designated to be public documents and copies can be requested by any member of the public, the only exception being the income differential statement (EEA4), which is not a public document. Pay discrimination The new section 6(5) of the EEA gives the Minister the power to prescribe in regulations the criteria and methodology for assessing work of equal value. The new regulations do this and arguably go beyond that, which itself may give rise to legal challenges to the regulations, but that is a discussion for another day. What emerges from the regulations is that employers may wish to undertake equal pay / terms and conditions audits, to assess whether there are unjustifiable differences in terms and conditions that may be linked to discrimination and, if so, to determine what remedial measures to take. Amongst the more noteworthy equal pay matters addressed in the regulations are the following: • The methodology for assessing possible pay discrimination claims is to • (a) establish if the work is of equal value and • (b) that there is a difference in terms and conditions of employment, including remuneration. • If so, one must then determine if the difference in terms and conditions is unfair, applying the new s11 of the EEA, which provides that, where discrimination is alleged on one of the listed grounds (e.g. race, gender,

disability, etc.), the employer bears the onus of proving that unfair discrimination did not take place, while the employee will bear the onus if the discrimination is alleged to be on an ‘arbitrary ground’,. The employer can prove there was no unfair discrimination if it proves that the discrimination either did not take place as alleged or that it did but that it was rational and not unfair or otherwise justifiable. • Determining whether work is of equal value must be evaluated by way of an objective assessment taking into account some fairly typical job valuation factors, such as the responsibility demanded of the work, skills and qualifications, etc. This exercise can be avoided only if the value of the relevant job has been classified in a sectoral determination. Unfortunately this does not extend to bargaining council collective agreements that classify job grades. What impact this may have on collective bargaining tactics and strategy remains to be seen. • Where the assessment reveals employees performing work of equal value but having different terms and conditions, the regulations provide that this will not be unfair discrimination where the difference is • (a) fair and rational; and • (b) is based on any one or a combination of certain prescribed grounds. Happily for employers, proposed compulsory consultation with employees regarding measures to eliminate pay discrimination, did not survive in the regulations. The impact of the regulations may also, in practice, stretch far beyond determining pay discrimination claims. The approach taken in the regulations to what is fair and rational in relation to differences in terms and conditions might, for instance, be argued by employees to be appropriate also in the assessment of unfair labour practice (provision of benefit) claims, not to mention the pay parity obligations indicated in the proposed amendments to the Labour Relations Act (LRA) in relation to part time employees, fixed term employees and labour broking, which have yet to be finalised.

COMMERCIAL LITIGATION Peters & Peters Solicitors LLP [UK]

The fight against illicit financial outflows from Africa: Why a global solution is necessary Introduction

Jonathan Tickner - Partner

Emma Ruane - Assiciate

Vlad Meerovich - Assiciate

Between 1980 and 2009, in excess of US$1 trillion left Africa in illicit financial flows. An illicit financial flow refers to a transfer of money earned through corruption, kickbacks, tax evasion and criminal activities. It can also potentially cover income which is earned legitimately but then transferred abroad in violation of exchange control regulations. Given that the size of the sum of money lost from Africa across three decades is the equivalent to the nominal size of Africa’s current gross domestic product, it is perhaps unsurprising that Africa has the highest proportion of assets held abroad of any region in the world.1 The former President of South Africa, Thabo Mbeki, commented on the problem while presenting the Progress Report of the High-Level Panel on Illicit Financial Flows at the Seventh African Union-Economic Commission Meeting on 30th March 2014. Mbeki lamented that money which would otherwise have been used to provide infrastructure and social amenities for the African community was instead being transferred to other (generally developed), countries.2 He noted the need to have the technical capacity to deal with sophisticated companies who have significant resources and are able to hire the best lawyers and the best accountants in order to maintain the outflow of funds from Africa. The issue has prompted Abdullah Haddock, the Deputy Executive Secretary of the United Nations Economic Commission for Africa (UNECA), to remark that illicit financial flows require “a global solution” because Africa cannot resolve the problem on its own.3 Criminal methods of asset recovery are of course available, but they require the wrongdoer to be convicted (either in the domestic court where the individual is based or possibly

Law Digest Autumn 2014

where the illicit funds are located) before a criminal confiscation order can be enforced. The UN Convention Against Corruption (UNCAC), which entered into force in 2005, provides a useful means through which the illicit financial flows problem can be tackled, but past cases have shown that satisfying all of the conditions needed to secure criminal convictions for different offences under the Convention can be extremely difficult. An alternative and effective means of preventing the illicit outflows of funds from Africa is to bring private asset recovery proceedings against wrongdoers through the civil courts. The use of civil proceedings is acknowledged in Article 53 of UNCAC, and it has the advantage that it is possible to recover assets or investments purchased with the funds in other jurisdictions. This article will discuss how the legal system of England and Wales can be used to assist in the enforcement of asset recovery. In recent years numerous sovereign states, corporates and individual victims have used the English courts to recover the proceeds of corruption and unlawful conduct; this analysis will focus on how the system can be used and why it is so effective.

An alternative and effective means of preventing the illicit outflows of funds from Africa is to bring private asset recovery proceedings against wrongdoers through the civil courts. Civil remedies Interim relief in support of foreign proceedings The High Court in England and Wales (henceforth referred to as “the English Court”) has wide-ranging powers to grant interim relief in domestic proceedings, such as worldwide freezing injunctions and search and disclosure orders (including Norwich Pharmacal orders).4 However, the Court may also grant interim relief in respect of proceedings in any foreign

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country pursuant to s.25 of the Civil Jurisdiction and Judgments Act 1982 (“the Act”), as extended by the Civil Jurisdiction and Judgments Act 1982 (Interim Relief Order) 1997, if: a. The facts of the proceedings in the foreign jurisdiction would warrant the relief sought if those proceedings were brought before the Court (“the First Condition”); and b. The Court does not consider, in light of the fact that it has no jurisdiction apart from s.25 of the Act in relation to the subject matter of the proceedings in question, that it would be inexpedient to grant the relief sought (“the Second Condition”).

The English criminal process may offer potentially cheaper and quicker assistance in the fight against illicit financial outflows from Africa. An illustrative example of the use of s.25 of the Act can be found in United States of America v Abacha and others.5 This case was brought by the USA, as a nation state, in support of an in rem forfeiture claim against certain assets held by the defendants. The USA claimed that assets derived from the proceeds of corrupt misappropriations carried out by the former President of Nigeria, General Abacha, and certain of his relatives and associates, were liable to forfeiture by reason of their involvement in money laundering in the USA. The USA applied to the Court under s.25 of the Act after its request to the English criminal enforcement agencies to apply for a freezing injunction under alternative legislation was refused. The First Condition was met as the judge, Mr Justice Field, accepted that the substance of the claim in the USA was civil rather than criminal in nature because it did not involve the prosecution or sentencing of an individual in a criminal court. Addressing the Second Condition, the judge remarked that it was

“unquestioningly expedient for this court to render the assistance sought by the claimant in aid of the US Claim. Corruption, like other types of fraud, is a global problem and it and its consequences are only going to be dealt with effectively if there is co-operation and assistance not only between the governments of states but also between the courts of different national jurisdictions”.6 Whilst in Abacha the USA sought to prevent the disposal of identifiable assets in England and Wales, the absence of such assets (or indeed connections to the jurisdiction) may not prevent the grant of relief. In Royal Bank of Scotland plc v FAL Oil Co Ltd and others, the claimant sought to continue a worldwide freezing injunction against the defendant companies and to require them to provide information as to the nature and location of their worldwide assets.7 Proceedings had been commenced by the claimant in Sharjah, where the first and second defendants were domiciled. The defendants sought to argue, inter alia, that they had no assets within England and Wales and that their connections there were non-existent, or tenuous at best, meaning that the Second Condition was not satisfied. In granting the orders sought by the claimant, the judge, Mrs Justice Gloster, found that the defendants did have the necessary links with the jurisdiction. She pointed to the credit facilities entered into between the claimant (an English bank) and the defendants, which were signed in London and in which the defendants agreed to accept service in London. The overdrawn accounts also demonstrated a real link with England, as did the fact that the first and second defendants held themselves out as having an operational presence there. The absence of any jurisdiction under the laws or procedural rules of the UAE to make the orders sought pursuant to s.25 of the Act was also relevant to the success of the claimant’s application. The judge noted that there was little danger of disharmony, confusion, or conflicting decisions, and as there was unlikely to be a potential conflict as to jurisdiction that could otherwise render it inappropriate or inexpedient to make a worldwide order.

London is one of the world’s largest financial centres and many international banks have a presence in the city. In the event that a defendant’s identity is not known or cannot reliably be established but a claimant is aware that funds have been transferred into a bank account or accounts, a Norwich Pharmacal order may be sought. Such relief compels a person caught up in the wrongdoing of another to disclose the identity of the wrongdoer so that proceedings may be brought. In relation to banks, this may mean that an order can be sought requiring the disclosure to the claimant of bank statements, correspondence, debit vouchers, transfer applications, and internal memoranda. This may still be the case even if the disclosure is ordered against a branch of an international bank, the headquarters of which are in another country, and it is envisaged that the disclosure will come from that country.8 Provided that the possibility or likelihood of such proceedings is explained in the

General Sanni Abacha, Former President of Nigeria

application, subsequent disclosure pursuant to a Norwich Pharmacal order may then be used to found proceedings in another jurisdiction, the Court having impliedly consented to the same by the making of the order.9 In the event that a respondent to an order bearing a penal notice on its face (such as a freezing injunction) fails to comply with its terms, a committal application may be made on the basis that there has been a contempt of court. A party found guilty of civil contempt of court may

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be imprisoned for up to 2 years.10 Just as an applicant can seek an order for committal against a defaulting respondent during the course of a domestic claim, this sanction may equally be imposed on a respondent to an order made pursuant to s.25 of the Act.11

Thabo Mbeki speaking at the 7th African UnionEconomic Committee on Illicit Financial Outflows

Bringing a claim in England and Wales The relief described above may equally be sought by commencing substantive proceedings in England, provided that the matter falls within the jurisdiction of the Court. The time to assess whether the English Court has jurisdiction is at the time the claim form is issued.12 In the event that the defendant cannot be served within the jurisdiction, an application for service outside of the jurisdiction may have to be made. In the event that the claimant must show that the UK is the appropriate forum for the claim to be heard (either to obtain an order permitting service out of the jurisdiction or in response to a challenge to jurisdiction) the Court will seek to apply the principles in either Council Regulation (EC) 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (“Brussels I”); the Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters 1968 (“the Brussels Convention”); or the Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters 2007 (“the

Lugano Convention”).13 The general rule set down by the Regulation and the Conventions is that the courts of the defendant’s domicile will have jurisdiction to hear the claim against him, regardless of his nationality.14 An individual will be taken to be domiciled in the UK, if he is resident in the United Kingdom and the nature and circumstances of his residence indicate that he has a substantial connection with the UK. If an individual has been resident in the UK for a period of 3 months prior to the issue of the claim form, a substantial connection with the UK is automatically established.15 If the individual is found to be domiciled in the UK, the Court is precluded from declining, as a matter of discretion, to exercise its jurisdiction on the ground that a court of another state would be a more appropriate forum to determine the action.16 If a claim is made against more than one defendant and jurisdiction on the basis that domicile can be established against one of the defendants, provided that the claims against the defendants are so closely connected that it would be expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings, the Court may assume jurisdiction over the other defendants, notwithstanding their domicile.17 If none of the defendants are domiciled in the UK, the Court may still exercise exclusive jurisdiction over a claim against them in certain circumstances including that: a. The claim relates to a contract and the UK is the place of performance of the obligation in question; b. The dominant or principal part of the claim concerns rights in immovable property or tenancies of immovable property situated in the UK;18 or c. The parties have agreed that the Court is to have jurisdiction to settle any disputes which have arisen or which may arise in connection with a particular legal relationship. Where the Court does not have exclusive jurisdiction, it must decide whether the UK is the appropriate forum for the claim to be brought.

Indeed, permission for service out of the jurisdiction will only be granted on this basis.19 Where it is common ground that the parties would have a fair trial in a competing jurisdiction, this exercise will normally involve the Court weighing up a number of different factors and deciding where the balance lies. In VTB Capital plc v Nutritek International Corp and others, Lord Justice Mance agreed that the Russian connection to the claim was of such strength and importance that, despite the existence of some factors favouring England, the claimant had been quite unable to discharge the burden of showing that England was clearly or distinctly the appropriate forum for determination of the issues in the case.20 In cases where there is another jurisdiction that may hear the case, claimants should consider the advantages and disadvantages of each jurisdiction as the forum for their dispute carefully. While the English legal process is transparent and gives parties a high degree of certainty, it can also be expensive. Parties have to conform to English procedural rules, regardless of the applicable law of the dispute, which may include the requirement for the claimant to disclose confidential internal or external documents relevant to their case. The Court is also committed to open justice, which may result in the publication of information the parties would otherwise not wish to be known which is read out during interim hearings or at trial. Finally, if witnesses are confined to another jurisdiction, it may be that any hearing has to take place, or be broadcast to the UK from, that jurisdiction.21 Criminal remedies The English criminal process may offer potentially cheaper and quicker assistance in the fight against illicit financial outflows from Africa. The assistance of English authorities can be sought by foreign prosecutors to restrain or confiscate assets pursuant to criminal proceedings in another jurisdiction.22 In the event that English or foreign authorities are unwilling or lack the resources to pursue criminal proceedings, a party may be able

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to commence a private prosecution provided there is a requisite jurisdictional nexus.23 A private prosecution is initiated by the laying of information before a Magistrates’ Court. The Magistrates’ Court will then decide whether to issue a summons. On the 22nd July 2014, a sentence of 8 years was imposed against Ketan Somaia in what is believed to be the largest private prosecution ever brought in England and Wales. The case was commenced by Peters & Peters Solicitors LLP on behalf of Mr Mirchandani, who had been defrauded of US$19.5 million. It is likely that cases such as these will only increase in the UK following the Court of Appeal’s judgment in R (Virgin Media Ltd) v Zinga, which stated that private prosecutors may pursue confiscation proceedings.24 Interplay between civil and criminal proceedings: A practical example A practical example of the realities of recovering illicit financial outflows can be found in the recovery of millions of dollars looted from Banco Noroeste, a bank established in San Paolo, Brazil. In that case, the head of the international division of the bank, Nelson Sakaguchi, misappropriated US$190 million through falsifying cash balances held offshore in the Cayman Islands after fraudsters duped him into believing that they were Nigerian government officials charged with the construction of a new international airport in Abuja. The black hole was discovered in 1998 as part of the due diligence process for the impending sale of the bank by its majority shareholders. By then the proceeds of the fraud had been laundered in Hong Kong, Switzerland, the UK, the US, Singapore and ultimately Nigeria for the ultimate benefit of Nigerian nationals Emmanuel Odinigwe Nwude, Christian Anajemba and Mr Anajemba’s widow, Amaka. In Switzerland, the criminal investigation secured the freezing of key bank accounts and afforded the Banco Noroeste claimants early access to the evidence that had been gathered. Pursuant to a warrant issued by the Juge d’Instruction in Geneva, Mr Sakaguchi was arrested in New York, and transferred to

stand trial in Geneva where he was subsequently imprisoned. In the UK, interim and summary judgments were obtained against Amaka Anajemba for US$150 million and US$290 million respectively. The UK proceedings involved 42 defendants and used a range of asset recovery tools including search and seizure orders, freezing injunctions, passport seizure orders, Norwich Pharmacal orders, interim payment orders, summary judgments, third party debt orders, charging orders and orders for sale. The civil judgments against Amaka Anajemba and subsequently Mr Nwude were transported to Nigeria and California for the purposes of enforcement. In Nigeria, the successes secured by the Banco Noroeste legal team working in conjunction with the Economic and Financial Crimes Commission (EFCC), established by the Nigerian Government to tackle money laundering offences head on, were spectacular. In July 2005, Amaka Anajemba pleaded guilty following a plea bargain arrangement and an agreement with the Banco Noroeste complainants. She received a 30 month sentence and fines of US$5 million and N1 million. In November 2005, Mr Nwude and another conspirator Nzeribe Okoli pleaded guilty, receiving five and four year sentences respectively and orders to forfeit assets. Ibrahim Lamorde, Chairman of the EFCC, has previously acknowledged these successes and has called for urgent action by countries in the African continent to come up and confront the menace of illegal cash movement across their various borders. Conclusion Illicit financial outflows represent a significant problem for African governments. Funds diverted in this way are funds that cannot be used for the betterment of the lives of the African population. The recovery of illicit financial outflows is entirely feasible and will quite often lead to asset recovery proceedings being instigated throughout the world. As detailed in this article, the UK’s legal system offers a variety of tools to prospective claimants, which can be used in tandem with measures taken in other jurisdictions.

1 Ashman, S., Fine, B. and Newman, S., ‘Amnesty International? The nature, scale and impact of capital flight from South Africa’, Journal of Southern African Studies, Volume 37, Number 1, March 2011. 2 This Day Live, ‘Mbeki: Nigeria, Others Lose $60bn Yearly to Illicit Financial Flows’, at http://www.thisdaylive.com/articles/mbekinigeria-others-lose-60bn-yearly-to-illicitfinancial-flows/175099/, 1 April 2014; The Africa Report, ‘Illicit Financial Flows: South Africa and Nigeria Speak Out’, at http:// www.theafricareport.com/West-Africa/illicitfinancial-flows-south-africa-and-nigeriaspeak-out.html, 27 June 2014. 3 ShanghaiDaily.com. ‘Report says Africa loses 50 bln USD in illicit cash flows’ at http://www. shanghaidaily.com/article/article_xinhua. aspx?id=217099, 8 May 2014. 4 Norwich Pharmacal Co v Customs and Excise Commissioners [1974] AC 133. 5 United States of America v Abacha and others [2014] EWHC 993 (Comm). 6 Ibid. paragraph 48. 7 Royal Bank of Scotland plc v FAL Oil Co Ltd and others [2012] EWHC 3628. 8 Credit Suisse Trust v Intesa San Paulo Spa and Banca Monte Dei Pasche Di Siena [2014] EWHC 1447 (Ch). 9 Shlaimoun and another v Mining Technologies International Inc [2011] EWHC 3278 (QB). 10 s.14(1), Contempt of Court Act 1981. 11 Kagalovsky and another v Balmore Invest Ltd and others [2013] EWHC 3876 (QB). 12 High Tech International AG and others v Deripaska [2006] EWHC 3276 (QB). 13 Domesticated by the Civil Jurisdiction and Judgments Act 1982. 14 Article 2 of Brussels I, Article 2 of the Brussels Convention, the Lugano Convention Article 3. 15 s.41(6) of the Civil Jurisdiction and Judgments Act 1982. 16 Owusu v Jackson (Case C-281/02), paragraphs 256 and 257. 17 Article 6(1), Brussels I. 18 Article 22(1), Brussels I. 19 Civil Procedure Rules, 6.37(3). 20 VTB Capital plc v Nutritek International Corp and others [2013] UKSC 5, paragraph 71. See also Standard Bank plc v EFAD Real Estate Company WLL and others [2014] 2 All ER (Comm) 208, where England was found to be the most appropriate forum for the claim. 21 For example, see Access Bank plc v Akingbola and others [2012] EWHC 2148 (Comm) where it was noted (at paragraph 7) that a video link was in operation throughout the trial of the matter, enabling the defendant to view the hearing as it progressed in London and for the Judge to view the evidence of the defence given in Nigeria, the representatives for all parties having travelled for this purpose. 22 See Part 11 of the Proceeds of Crime Act 2002 and the POCA 2002 (External Requests and Orders) Order 2005. 23 s.6(1), Prosecution of Offences Act 1995. 24 R (Virgin Media Ltd) v Zinga [2014] EWCA Crim 52.

AVIATION LAW George Gom, AELEX [Nigeria]

Recent developments in Aviation Law in Nigeria

George Gom Managing Associate

The Rules make provision for the arrest of aircraft by parties with a proprietary claim in an aircraft such as creditors, lessors, mortgagors and parties with secured interests

Recently, the Chief Judge of the Federal High Court enacted the Nigerian Civil Aviation (Procedure) Rules 2013 (“the Rules”) to regulate the practice and procedure of all aviation proceedings or matters brought before the Federal High Court.1 This article highlights some of the new features of the Rules. The Rules came into force on 31st January 2014 and apply to all aviation proceedings or matters brought before the Federal High Court pursuant to the Admiralty Jurisdiction Act 1991 and/or the Nigerian Civil Aviation Act 2006.2 The Rules do not apply to matters which are part heard before the rules came into force, but apply to matters which had been filed and no other step was taken except the filing.3 Prior to the enactment of the Rules, the practice and procedure relating to aviation claims were regulated by both the Admiralty Jurisdiction (Procedure) Rules 2011 (“the AJPR”) and the Federal High Court (Civil Procedure) Rules 2009. However the arrest provisions relating to aircrafts were not elaborate. The arrest provisions under the AJPR were made only in respect of ship and other property and did not make adequate provisions for the arrest of aircraft. The major provision relating to the arrest of aircraft under the AJPR is made under Order 19 which provides that the Court may grant an order for the arrest, detention, custody or

Law Digest Autumn 2014

preservation of an aircraft where the action relates to a proprietary claim concerning the aircraft. The AJPR did not make further provisions on how the aircraft may be arrested. It provides for the warrant of arrest to be executed by the Admiralty Marshall of the Federal High Court. Arrest provisions may also be found under Order 30 of the Federal High Court (Civil Procedure) Rules 2009 but may only be exercised in the form of a mareva injunction. Innovations under the Rules The Rules make provision for the arrest of aircraft by parties with a proprietary claim in an aircraft such as creditors, lessors, mortgagors and parties with secured interests. The Rules allow the arrest of sister aircrafts to provide security for an aviation claim where the sister aircraft is found or expected to arrive within jurisdiction. The arrest provisions under the Rules attempt to codify the remedies available to creditors, lessors and parties with secured interests in enforcing the security for their claim guaranteed under the Convention on International Interests in Mobile Equipment 2001(‘the Convention’) and the Protocol on Matters Specific to Aircraft Equipment (the Protocol) which are domesticated in Nigeria under the Nigerian Civil Aviation Act 2006.5 The Convention and the Protocol establish an international regime for the creation and enforcement of security interests held by lessors, creditors and conditional sellers of aircraft objects such as airframes, aircraft engines and helicopters. They govern the rights of parties with a proprietary interest in aircraft in Nigeria. Remedies to be exercised by creditors in the event of a default under the Convention, must be exercised in a commercially reasonable manner. Creditors may

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A party who secures an order of arrest of aircraft in a claim for the loss of luggage or goods may find itself liable to pay compensation for wrongful arrest

are carried out as prescribed by the manufacturer. The Court may with the assistance of a reputable aviation company order the aircraft, engine or other property to be leased on either an Aircraft, Crew, Maintenance and Insurance Lease (ACMI) or an Aircraft, Maintenance Insurance Lease (AMI) or a dry lease for such determined periods of time. The expenses of the

Damages for wrongful arrest After an order of arrest has been made and it afterwards appears to the Court that the arrest of any aircraft, or order of attachment, sale or injunction was made on insufficient grounds, or if the suit in which the application was made is dismissed or judgment is given against the

Another provision likely to give rise to difficulty in implementation is the arrest of a sister aircraft. Plaintiff, and it appears to the Court that there was no probable ground for instituting the suit, the Court may upon the application of the Defendant award reasonable compensation to the Defendant for any loss, injury or expenses he may have sustained by reason of the arrest. Implementation of the Rules The issues regarding arrest of aircraft are still unclear

procure the de-registration of the aircraft and the export and physical transfer of the aircraft object from Nigeria. Other remedies available to creditors include the power to take possession or control of the aircraft object; exercise the power of sale or grant a lease; receive profits arising from the management or lease of the aircraft object; or apply to the appropriate Court for an order directing any of the above acts.8 Interim orders for preservation of aircraft The Court has the power to make orders for the preservation, management or control of the aircraft under arrest. The Court may order the aircraft to be hangered in an aircraft hanger with a reputable independent aviation company where the necessary checks and services

Aviation Marshall in connection with the valuation and lease of the aircraft shall be deducted from the proceeds of the lease. Power of sale Where the owners have failed to provide bail for the aircraft after a period not less than three months, the Court may order that the aircraft under arrest be sold by the Aviation Marshall and the proceeds of sale paid into an interest yielding account pending further orders of the Court. The Court may also on application of a party either before or after final judgment order that the aircraft, asset or other property under arrest be valued or valued and sold. The Court may also order the aircraft, asset or other property to be sold where the aircraft is deteriorating in value.

It is not clear how the provisions for the arrest of aircraft, asset or other property to enforce an aviation claim will be interpreted and implemented by the Court. The Rules were fashioned largely after the provisions of the AJPR which made elaborate provisions only for the arrest of ship. The similarities between the arrest provisions of the AJPR and the recently enacted Rules may give room for controversy or difficulty in implementation. For example, under the AJPR, a party with a maritime claim can institute either an action in rem or an action in personam. The action in rem can be instituted directly against the ship as a maritime claim as defined under the Admiralty Jurisdiction Act 1991. An example of a maritime claim in rem could be a claim for the loss of or damage to goods carried by ship. There is no equivalent definition for an

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aviation claim under the Admiralty Jurisdiction Act 1991 or the Civil Aviation Act 2006. A claim for the damage to goods carried by aircraft should not ordinarily entitle a party to institute an action in rem against the defaulting aircraft. The relevant convention governing the liability for loss or damage to luggage or goods in Nigeria is the Montreal Convention 1999. Under the Montreal Convention 1999, the carrier is liable for damage sustained to any registered luggage or any goods if the occurrence which causes the damage so sustained took place during the carriage by air. From these provisions, a claim for the loss or damage to luggage or goods should be instituted as an action in personam against a carrier and not as an action in rem against the aircraft. A party who secures an order of arrest of aircraft in a claim for the loss of luggage or goods may find itself liable to pay compensation

for wrongful arrest. Another provision likely to give rise to difficulty in implementation is the arrest of a sister aircraft. The Rules simply provide for the arrest of a sister aircraft without guidance on what qualifies an aircraft as a sister aircraft. Unlike the Rules, the AJPR makes reference to Section 5 (4) (b) of Admiralty Jurisdiction Act 1991 for what qualifies a ship as a sister ship for the purpose of bringing an action in rem. A sister ship is defined as one in which the relevant person is either the beneficial owner in respect of all the shares or the charterer under a demise charter. There is no such reference under the Rules to the definition of a sister aircraft. The provisions of Section 5 (4) (b) of Admiralty Jurisdiction Act 1991 determine the conditions which must exist before a party can bring an action in rem against a ship. No such conditions are determined

in relation to an aviation action in rem. As the Rules currently stand, a party seeking to arrest an aircraft or sister aircraft in Nigeria would need to proceed with caution or take the risk of being sued for wrongful arrest. A subsequent review of the Rules may be necessary to bring certainty and greater clarity into the entire arrest process. 1 Pursuant to the powers conferred on him by Section 254 of the 1999 Constitution 2 Order 1 (2) (1) of the Nigerian Civil Aviation (Procedure) Rules 2013 (the ‘rules’) 3 Order 1(3) (2) Ibid 4 Order 19 (3) Ibid 5 See Schedules I-V 6 Articles IX (3) of the Protocol 7 Article IX (1) (a) and (b) Ibid 8 Article 8 (1) and (2) of the Convention 9 Order 18 Ibid 10 Order 9 (6) (2) Ibid 11 Order 15 (1) Ibid 12 Order 15 (1) (3) Ibid 13 Order 11 Ibid 14 Section 2 of the Admiralty Jurisdiction Act 1991 15 Section 2 (3) (e) Ibid 16 Article 17 (2) of the Montreal Convention 17 Order 5 (4) op cit fn 4

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TAX Celia Becker - ENSafrica [South Africa]

Transfer pricing in Ghana and Nigeria

Celia Becker African Tax and Country Risk Executive

“Nigeria and Ghana often compete to attract foreign investors wishing to establish operational or marketing hubs in West Africa and it is interesting to note the significant similarities between the transfer pricing provisions applicable in these two jurisdictions”

mportant considerations for investors wishing to establish a presence in a country include the potential tax implications in such jurisdiction, of which the transfer pricing provisions applicable to goods, services or intellectual property being transferred between related parties is an important aspect. Nigeria and Ghana often compete to attract foreign investors wishing to establish operational or marketing hubs in West Africa and it is interesting to note the significant similarities between the transfer pricing provisions applicable in these two jurisdictions. Transfer Pricing Regulations In Nigeria, broad rules regarding related-party transactions have always been included in the general anti-avoidance provisions contained in the Companies Income Tax Act 2004, the Personal Income Tax Act 2004 and the Petroleum Profits Tax Act 1990. In terms of these general rules, the Federal Inland Revenue service (FIRS) is entitled to adjust any transaction which is regarded as artificial and which reduces tax payable. Any transaction between related parties shall be deemed to be artificial or fictitious if, in the opinion of the Board, those transactions have not been entered into on terms which might reasonably have been expected to have been entered into by persons engaged in the same or similar activities dealing at arm’s length. In September 2012, the FIRS published transfer pricing rules, the Income Tax (Transfer Pricing) Regulations No.1 2012 (the Nigerian Regulations) effective for

Law Digest Autumn 2014

all tax years commencing on or after 1 August 2012. The Nigerian Regulations are based on the Organisation for Economic Cooperation and Development (OECD) Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (the OECD Guidelines) and the commentary surrounding the creation of the United Nations Transfer Pricing Manual (UN Manual) which was formally approved in October 2012. In the event of conflicts between interpretations contained in the UN Manual and the OECD Guidelines, the relevant tax laws will prevail. In terms of the basic transfer pricing

The Nigerian and Ghanaian Regulations both provide for the use of five specified methods as a basis for pricing controlled transactions provisions contained in section 70 of the Ghanaian Internal Revenue Act, 2000, Act 592 (the IRA), in a transaction between persons who are associates, the Commissioner may distribute, apportion, or allocate inclusions in income, deductions, credits, or personal reliefs between those persons as is necessary to reflect the chargeable income or tax payable which would have arisen if the transaction had been conducted at arm’s length. In making such an adjustment, the Commissioner may characterise the source of income and the nature of any payment or loss as revenue, capital, or otherwise. The Ghanaian Transfer Pricing Regulations 2012 (L.I.2188) (the Ghanaian Regulations) were introduced by the Ghana Revenue Authorities (GRA) on 27th July 2012, effective from 14 September 2012, to provide practical guidance regarding the implementation of the general anti-avoidance provisions contained in the IRA. The Ghanaian

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The Nigerian Regulations provide for controlled taxable persons to enter into a unilateral, bilateral or multilateral Advance Pricing Agreement (APAs) with the FIRS Regulations are also based on the OECD Guidelines. According to the Practice Notes on transfer pricing released in January 2013, the GRA will similarly apply the principles contained in the OECD Guidelines, except when they are inconsistent with the provisions of the Ghanaian Regulations. Related Parties The Nigerian Regulations are applicable to “connected taxable persons”, broadly defined as one party that participates, directly or indirectly, in the management, control or capital of the other, or where both parties have common control, management or shareholders. It is noteworthy that there is no specific threshold, such as stock ownership or voting shares, for determining control. As a result, two companies can be deemed to be “connected” due to the facts and circumstances of their relationship granting one effective control over the other, despite having no common ownership. For the purposes of the Nigerian Regulations, permanent establishments are treated as separate entities, and any transaction between a permanent establishment and its head office or another connected taxable person shall be considered a controlled transaction. The Ghanaian Regulations apply to transactions involving three broad categories of persons: (i) persons or taxpayers in a controlled relationship, (ii) permanent establishments and their head offices or other related

branches and (iii) taxpayers in an employment relationship. A “controlled relationship” in respect of corporate entities refers to a relationship between two persons where the terms of the relationship enable influence on the transfer price set in a transaction, and in which one person is inter alia (a) an associate of the other person or (b) a holding company, a subsidiary or a subsidiary of a holding company to which the first person is a subsidiary. Where a person, not being an employee, acts in accordance with the directions, requests, suggestions, or wishes of another person whether or not they are in a business relationship, both persons are treated as “associates” of each other. The definition of “associate” also specifically includes a person who is an entity and a person who, either alone or together with an associate(s) controls or may benefit from fifty per cent or more of the rights to income or capital or voting power of the entity, either directly or through one or more interposed entities. The definition of “controlled relationship” specifically includes transactions between two taxpayers who are in an employment relationship. As a result, interest free loans or other benefits granted by an employer to an employee at non-market interest rates or prices will be subject to transfer pricing adjustments. In both Nigeria and Ghana the Transfer Pricing Regulations are equally applicable, whether the controlled transaction is crossborder or domestic. Pricing Methods The Nigerian and Ghanaian Regulations both provide for the use of five specified methods as a basis for pricing controlled transactions. These methods are the same as those promulgated by the OECD Guidelines and the UN Manual, namely the Comparable Uncontrolled Price (CUP), Resale Price (RP), Cost Plus (CP), Transactional Profit Split

(TPS) and Transactional Net Margin (TNM) method. Both Regulations also provide for the use of an unspecified method if the taxpayer can demonstrate that none of the prescribed methods are suitable and the unspecified method provides an arm’s length result. Advance Pricing Agreements The Nigerian Regulations provide for controlled taxable persons to enter into a unilateral, bilateral or multilateral Advance Pricing Agreement (APAs) with the FIRS, in terms of which the FIRS and the taxpayer agree to the method and manner in which related party transactions will be priced for a specified period. There is no application or processing fee for an APA, but a minimum annual transaction value of NGN250 million (approximately USD1.6 million) is required. Generally APAs between the FIRS and taxpayers will have a term of three years. The Ghanaian Regulations do not make specific provision for APAs, but a taxpayer may, in terms of existing provisions of the IRA, apply for a binding private ruling from the GRA regarding the application of the IRA in respect of a transaction entered into or proposed by a taxpayer.

Neither of the Regulations provide for a unique penalty regime for transfer pricing. However, the penalties and interest provisions of the relevant Tax Acts will apply to transfer pricing adjustments. Safe Harbour Provisions In terms of the Nigerian Regulations, a connected taxable person need not comply with the documentation and filing requirements under

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the Regulations if the controlled transactions are priced in accordance with the requirements of Nigerian statutory provisions or the prices of connected transactions have been approved by other Nigerian government regulatory agencies, such as the National Office for Technology Acquisition (NOTA), the Department of Petroleum Resources (DPR) or the Nigerian National Petroleum Corporation (NNPC). However, despite these safe harbour provisions, such prices remain subject to the satisfaction of the FIRS that they are in fact at an arm’s length and it would be prudent for taxpayers to establish prices that are justifiable for transfer pricing purposes. The Ghanaian Regulations do not provide for any materiality thresholds. However, the Transfer Pricing Practice Notes confirms that transfer pricing compliance should not place an onerous burden on the taxpayer’s resources and the GRA therefore only expects information and documentation in respect of “material” intercompany transactions. The Practice Notes do not stipulate a threshold for materiality, but as a common “rule of thumb” the proportion of total goods or services derived from related party transactions are being considered. Documentation and Compliance In terms of the Nigerian and Ghanaian Regulations and subsequent guidance issued by the tax authorities, taxpayers are required to maintain contemporaneous transfer pricing documentation to

demonstrate the arm’s length nature of their related party transactions. Such documentation should include not only a global group transfer pricing policy, but also a domestic policy taking into consideration the requirements of the specific country’s transfer pricing framework. Specific information is required to be supplied with the annual tax return and the tax authorities are permitted to address a specific request to a person to submit additional information. In Nigeria an annual transfer pricing disclosure form must be submitted at the time of filing the annual income tax return. In addition, a transfer pricing declaration form must be submitted for the first year of submission of the transfer pricing returns. The transfer pricing disclosure form requires the provision of information about all the taxpayer’s controlled transactions, transaction volumes and selected transfer pricing methods. The transfer pricing declaration form requires the provision of information about the reporting entity, its parent, subsidiaries, ownership structure, major shareholders and directors. The GRA has issued an Annual Return on Transfer Pricing Transactions, which requires the taxpayer to disclose information on the intercompany transactions undertaken during the year to which the return relates and must be submitted as part of the annual income tax return no later than four months after the company’s financial yearend. The return requires detailed information on transfer pricing, including particulars

of the group structure, related parties with whom the taxpayer has entered into transactions during the relevant year and a breakdown of intercompany transactions. Penalties Neither of the Regulations provide for a unique penalty regime for transfer pricing. However, the penalties and interest provisions of the relevant Tax Acts will apply to transfer pricing adjustments. Recent Developments Both the FIRS and the GRA have been hosting stakeholders’ sensitisation sessions and workshops on transfer pricing with the objective to promote voluntary compliance with the legislation and educate companies on their transfer pricing obligations. The GRA announced in July 2013 its intention to establish a specialised transfer pricing unit in its large taxpayer centre, while the FIRS early in 2014 launched its transfer pricing division as an office within the tax administration to specifically implement the Nigerian Regulations. The Nigerian and Ghanaian tax authorities have both in recent months written to taxpayers requesting them to submit the required transfer pricing forms and supporting documentation, signalling their commitment to robust transfer pricing regimes. In light of these similarities, in all likelihood the FIRS and GRA will also implement similar enforcement approaches going forward.

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Law Digest Autumn 2014

CONTRACT LAW ENSafrica [South Africa]

Is good faith and fairness or Ubuntu a contractual term in South Africa?

Adriaan Hoeben – Director

he Constitutional Court, the highest Court in South Africa, which has now been given wider jurisdiction to hear matters of public importance has, due to an amendment to the Constitution of the Republic of South Africa, recently handed down a judgment which is expected to have a significant impact on the principles of the law of contract in South African law. In fact, the aim to uphold the principles of Ubuntu and to promote good faith and fairness in contracts is increasingly becoming a trend in judgments handed down by the Constitutional Court. What is good faith in the law of contract?

Sue Hayes – Director

Maria Domingos – Director

The notion of good faith is not a new phenomenon; it has always been part of South African common law. Good faith has been regarded as the doing of simple justice between person-and-person. It involves a respect for the other party’s interests in a contract. Because a contract is an agreement between two or more parties, and often involves the principle of reciprocity, parties should not enter into an agreement in bad faith, as doing so would destroy the trust between parties and create commercial chaos. However, good faith is not a standalone requirement in a contract. This much was made clear in judgments handed down by the Supreme Court of Appeal and its predecessor, the Appellate Division.

Law Digest Autumn 2014

Nonetheless, the Constitutional Court has attempted to develop this notion of good faith and, on a related note, the concept of fairness. The Constitutional Court has attempted to give content and understanding to the notions of good faith and fairness through interpreting and attempting to apply the concept and constitutional value of ‘Ubuntu’. While Ubuntu is not expressly stated as a constitutional value in the Constitution, it was provided for in the Interim Constitution. The Courts have also continually stated over the years that it is a constitutional value and that it assists in giving content to the three express constitutional values of freedom, dignity and equality. Determining fairness and good faith in contracts: Barkhuizen v Napier In the case of Barkhuizen v Napier (CCT72/05) [2007] ZACC 5; 2007 (5) SA 323 (CC); 2007 (7) BCLR 691 (CC) (4 April 2007), (“Barkhuizen” ) the Constitutional Court stated

While Ubuntu is not expressly stated as a constitutional value in the Constitution, it was provided for in the Interim Constitution that two questions need to be asked in determining the fairness of a contractual term: 1. whether the clause itself is unreasonable/contrary to public policy; 2. if not, whether its enforcement in the particular circumstances would be unreasonable/contrary to public policy. The Supreme Court of Appeal, in the case of Bredenkamp and Others v Standard Bank (599/09)

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In an attempt to develop the notion of good faith and fairness in contract, the Court subjected the enforcement of the cancellation clause to the fairness of doing so [2010] ZASCA 75 (27 May 2010), (“Bredenkamp” ) reacted to the Barkhuizen judgment and held that there was no over-arching requirement of fairness in contract. It held that Barkhuizen was limited to constitutional issues. The legal profession has been eagerly awaiting a judgment in which the Constitutional Court may react to the Bredenkamp judgment. Fairness over certainty: Botha and another v Rich N.O. The very recent case of Botha and Another v Rich N.O. and Others (CCT 89/13) [2014] ZACC 11; 2014 (4) SA 124 (CC); 2014 (7) BCLR 741 (CC) (17 April 2014), has given a further indication of the Constitutional Court’s approach to this issue of good faith and fairness in contracts, but it did not seem to authoritatively express its stance on this point. This case concerned an interpretation of s 27(1) of the Alienation of Land Act 69 of 1981 (“the Act”), which provides that if a person has paid 50% or more of the purchase price of property which is subject to an instalment sale agreement, that person can demand that the seller transfer the land into his / her name on condition that he / she registers a mortgage bond in favour of the seller over the said land. In this case, the seller purported to cancel the agreement and to enforce the forfeiture of the purchaser’s payments, because the purchaser had defaulted on her payments. One would have expected the Court to order the cancellation of the

A sitting of the Constitutional Court in Braamfontein

contract, due to the purchaser’s default but not forfeiture, which is unlawful, according to s 19 of the Act. Therefore, upon cancellation the purchaser would be entitled to full restitution. However, the Constitutional Court approached the issue in a different manner. In an attempt to develop the notion of good faith and fairness in contract, the Court subjected the enforcement of the cancellation clause to the fairness of doing so. One can see the Court’s attempt to infuse constitutional norms and values into the general principles of the law of contract. In fact, it was stated in the Constitutional Court case of Everfresh Market Virginia (Pty) Ltd v Shoprite Checkers (Pty) Ltd (CCT 105/10) [2011] ZACC 30; 2012 (1) SA 256 (CC); 2012 (3) BCLR 219 (CC) (17 November 2011), that Courts need to develop a new contractual order which is informed by constitutional and traditional African values. In the Botha case the Court dealt with s 27(1) of the Act, and interpreted that the purchaser is entitled to demand transfer of the land into his / her / its name, provided that the purchaser tenders payment of the arrears amount and, if applicable, any municipal charges and registers a mortgage bond over the property in favour of the seller. However, the seller had exercised its right to cancel the contract due to the purchaser’s default and that the purchaser made no attempt to pay

the arrears as contemplated by s 27(1) of the Act. The Court, however, considered whether the enforcement of a cancellation clause is fair under the circumstances, where the seller exercised its rights in terms of the contract to cancel such contract due to default by the purchaser. The Court held that such enforcement of the cancellation clause would be unfair, and accordingly dismissed the cancellation application and ordered that the Respondents do all things necessary to effect transfer of the property to the Applicant, provided that payment of all arrears amounts are paid to the Respondents and a mortgage bond is registered over the property in favour of the Respondents. It seems that the effect of this judgment is that the exercise of a contractual right may be subject to a standard of fairness. Consequently, although certainty is a requirement of the law of contract, it may be pushed aside in favour of upholding a standard of fairness in contract. Thus, the enforcement of a cancellation clause may be subject to a fairness enquiry by a Court. Parties must enter into contracts in good faith and act fairly to one another. The Constitutional Court is adamant to develop the law of contract in line with constitutional values and it will continue to do so. While the law is developing as such, this particular point of law will remain in a state of f lux.

CAPITAL MARKET Ebunoluwa B. Awosika - Associate Partner - Ajumogobia & Okeke1, [Nigeria] Law Digest Autumn 2014

Overview of the Nigerian Capital Market

Ebunoluwa B. Awosika Associate Partner

“SEC has stated that it will be addressing issues impacting on regulations in general focusing on stronger enforcement, regulatory oversight and capacity building”

he Nigerian capital market has gone through its fair share of ups and downs in recent times. This notwithstanding, it can be argued that the capital market has, for the past several decades, remained the most effective mechanism for Nigerian entrepreneurs and businesses to raise medium and long term capital. Since 1946 when the first loan stock was floated in the Country,1 the establishment of the Nigerian Stock Exchange (NSE or the Exchange) in 19612 and the establishment of the Securities and Exchange Commission (SEC or the Commission) in 1980,3 the development of the capital market as a mechanism for determining prices and a channel for sourcing capital, has made it possible for businesses seeking alternative methods of financing other than loan financing to remain viable in a very tough environment, whilst at the same time allowing the average investor the opportunity to become part owner of highly valuable and often profitable enterprises that they would ordinarily not have been a part of. The Nigerian capital market also felt the impact of the global meltdown in 2008 because many foreign investors divested from emerging markets such as Nigeria, in order to cushion the effects of losses suffered at home. It seemed that local investors also erroneously imposed banks’ shortterm orientations on a long-term capital market. The meltdown also exposed the inadequacy of some of the existing regulations particularly in the area of margin trading. At the end of 2013, NSE equity market capitalisation surpassed the market cap at the peak of the market in 2008 (₦13.23 trillion vs. ₦12.62

trillion).4 The capitalisation of listed equities grew by 47.33% and the NSE All Share Index (ASI) gained 49.19%. Currently the capitalisation of the NSE is about 27% of Nigeria’s gross domestic product (GDP).5 In comparison, the capitalisation of the Malaysian market for example is 270% of that country’s GDP, while that of Brazil and India is 130%. The regulators of the capital market do not have to be told that Nigeria’s capital is lagging behind comparable developing nations and that there is an urgent need to develop and grow the capital market as it is such an essential area of a nation’s economic development. It is not surprising therefore those reforms are being introduced to the

The Nigerian and Ghanaian Regulations both provide for the use of five specified methods as a basis for pricing controlled transactions capital market aimed at ensuring that the market capitalisation of the NSE grows in leaps and bounds henceforth, with a forecast target of 130% of the country’s GDP by 2024.6 To achieve this target, the SEC has stated that it will be addressing issues impacting on regulations in general, focusing on stronger enforcement, regulatory oversight and capacity building within the capital market, the introduction of new products and reducing overall costs of transactions among others. Initiatives Geared Towards Enhancing the Development of the Nigerian Capital Market. Reforms/Initiatives: The Main Board vis a vis the Alternative Securities Market Board The market structure and segmentation of the Exchange has undergone some changes in recent times. The First Tier securities market is now referred to as the Main Board while the Second Tier securities market is now referred to as the Alternative Securities Market (ASeM) Board.

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The market structure and segmentation of the Exchange has undergone some changes in recent times

Capitalisation of the Bovespa is 130% of the Brazilian GDP

The Main Board

matters in general.

The Main Board primarily features shares of large (blue chip) companies. There are three (3) important criteria for admission in to the Main Board. These are:

Registration of Over the Counter (OTC) Trading Platforms

1. at least 20% of issued shares must be held by the public; 2. the number of shareholders of the company must not be less than 300; and 3. the issuer is required to pay an annual listing fee based on its market capitalisation. The ASeM Board The ASeM Board on the other hand is a specialised board of the NSE for start-ups, emerging businesses, small and medium sized companies with high growth potential. The listing rules and requirements for admission to the ASeM have been made quite flexible to accommodate a wide range of small to medium sized businesses essentially to provide them the opportunity to access the many benefits of the capital market. In order to ensure compliance with requirements and obligations of the ASeM, the Exhange conducted a selection process to appoint Designated Advisers (â&#x20AC;&#x153;DAsâ&#x20AC;?) for companies to be listed on the ASeM Board of the Exchange. The DAs will provide professional resources to qualifying companies for guidance and advice on securities related

The Commission approved the registration of two OTC trading platforms in 2012. The trading platforms (FMDQ OTC Plc and National Association of Securities Dealers (NASD) Plc) are for transactions in unlisted securities including equities and bonds. This is in view of the fact that only about two hundred (200) companies are listed on the NSE and trading on the securities of other unlisted plcs was never captured. The rationale behind the registration of the OTC platforms was that it will further the cause of efficiency, transparency, price discovery and liquidity in the trading of the shares of unlisted companies and also prepare unlisted companies for listing on the NSE. The NASD OTC market was launched in Lagos in July, 2013. The NASD is expected to offer a variety of products and services now and in the future. They include Securities Trading, Derivatives, Options, Futures, Company Listing, Capital Raising, Research Analytics and other value-added services as in other jurisdictions. In addition, the NASD OTC market will offer investors a platform from where they can obtain information on available investments that are not listed on the NSE. This information will include

prevailing prices/last deal price on a security, a range of asset classes to choose from and financial performance of non-listed companies. FMDQ OTC Plc which was inaugurated in November 2013, is an OTC market where fixed income instruments and currencies are exchanged. It is hoped that the existence of the new OTC platforms will encourage retail participation in bond trading which is virtually non-existent now. On its own part, the NSE in January 2013, in a bid to revamp trading activities of secondary fixed income securities listed on the NSE, unveiled six Fixed Income Market Markers (FIMMs), to engage in market making of the listed bonds. Creation of New Rules on Book Building, Shelf Registration and Sukuk Introduction of new rules on book building, shelf registration and Sukuk among others are meant to hasten the development of the capital market and reduce transaction costs. The introduction of Book Building and Shelf Registration have shortened the average issuance period and improved the price discovery process for bonds and other issues, while Sukuk which is more recent will provide issuance variety in the Nigerian capital market. The advantage of the introduction of Sukuk instrument is that it is noninterest bearing and would capture the group of investors who are averse to interest bearing instruments. Already one State government has issued bonds in the market through Sukuk. Developing Schemes

Collective

Investment

SEC has over the years continued to emphasise its resolve to develop and ensure increased investor participation in the collective investment schemes. Consequently, further significant steps were taken

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Operators in the capital market have identified the following factors as vital: • more vigorous policing and enforcement of punitive actions against insider traders and other forms of market manipulation; • clearly defined, enforceable standards as well as an effective enforcement framework; • fines and disciplinary actions should be announced and made public to serve as a deterrent; and • more effective surveillance mechanisms should also be introduced into the market.

Bond trade does not currently exist in Nigeria

in this direction in 2012. Steps taken in the year included the directive to transfer assets under the management of fund managers to custodians in order to prevent conflict of interests, as in the pension industry. Trustees are therefore limited to handling only the fiduciary functions while the fund custodians hold the assets.

The ASeM Board on the other hand is a specialized board of the NSE for startups, emerging businesses, small and medium sized companies with high growth potential Restoration of Investors’ Confidence The SEC has continued to carry out various activities aimed at restoring the confidence of investors (particularly local investors) in the capital market. The focus has been on clarity of rules and regulations to achieve transparency and market efficiency. Some of the major actions taken include: • •

E n l i g h t e n m e n t /o u t r e a c h programmes organised for each State; Closing down and sealing up of the premises of companies proven to have engaged in Ponzi schemes (wonder banks)

•

and illegal market operations; and Real time online surveillance of trading on the floor of the NSE to further promote market integrity and transparency.

Other Initiatives Takeoff of Sovereign Wealth Fund: with a takeoff fund of US$ 1 billion set aside as seed capital, part of this fund will definitely be invested through the capital market.

Development of New Products The Commission hosted an Infrastructure Roundtable in collaboration with the National Planning Commission (NPC) which brought key policy makers, issuers and experts together to explore ways in which the capital market could be leveraged to finance the $3.9 trillion required investment in infrastructure over the next thirty (30) years according to the National Integrated Infrastructure Master Plan. The SEC also co-sponsored a Debt Capital Market Conference in collaboration with the International Finance Corporation (IFC), where plans by the IFC to float its first long-term, local-currency bond programme of about $1 billion in Nigeria was disclosed. The bond will allow the IFC to issue a series of local-currency bonds to deepen the domestic capital markets and support private sector development in Nigeria. SEC has also invested hugely in the area of securitisation in terms of capacity building. Reduction/Eradication Trading

Insider

To reduce incidents of insider trading or to eradicate it completely,

Government Reforms and Policies: Privatisation of the power sector is expected to require substantial private sector financing. The new owners are expected to access the capital market for funds particularly through private sector participation. This will in turn create more employment opportunities, new markets and development of financial instruments to fast track the accessibility of funds for the development of the power sector. Cross Border Listings: The NSE encourages cross border listings. Overseas issuers can list their shares on the NSE once they comply with the cross border listing rules and they are encouraged to contact the NSE, if they envisage any difficulties in complying fully with the relevant requirements. The NSE reserves the right in its absolute discretion, to refuse a listing of securities of an overseas issuer for any number of reasons one of which is the belief that the jurisdiction in which the overseas issuer is incorporated is unable to provide standards of shareholder protection at least equivalent to those provided in Nigeria.12 Unless the NSE agrees, only securities registered in Nigeria may

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Global Depositary Receipts17 (GDR’s): Interestingly, many of the GDR’s that have been issued from Nigeria all happened in the same year, 2007. In that year seven companies (First Bank Plc, GT Bank Plc, UBA Plc, Access Bank, FCMB Plc, Diamond Plc and Fidelity Bank Plc) all issued global depositary receipts in other jurisdictions and since that time, there has not been any other issuance to date. See ‘Figure 1’

Opening day trade at the NSE

be traded on the NSE13 and where two (2) or more registers are maintained, it will not be necessary for the NSE register to contain particulars of the shares registered on any other register.14 If the listing involves a marketing of the securities for which listing is being sought, then securities with an expected market capitalisation of at least ₦28 Billion or equivalent must be offered in Nigeria.15 It should be noted that a number of Nigerian companies have done the reverse by successfully embarking on cross border listings or issuance of securities abroad. In recent times some of the trail blazing Nigerian companies particularly within the oil and gas sector have been able to access huge amounts of foreign funds in the international markets. For example, following in the footsteps of local oil giants like Oando Plc, another foremost independent oil and gas company, SEPLAT Petroleum Development Company confirmed that S/N

ISSUER

Diamond Bank Plc

GT Bank Plc

3 4

funds in the international market in its initial public offering (IPO), which was a dual listing in the London and Nigeria’s Stock Exchanges. The offer comprised of a base offering and an over - allotment option. The base offer sought to raise GB£300.9 million (approximately US$500). The company priced its offering at 210 pence a share on the London Stock Exchange and ₦576, or about US$3.52, a share on the Nigerian Stock Exchange in Lagos, giving it a market capitalisation of £1.14 billion. The over allotment portion is to represent 15% of the final amount allocated to the international offering in the base offer. It was recently announced that SEPLAT’s IPO was over - subscribed thereby making it possible to achieve the dual objectives indicated above. This new era of securities of companies based and operating out of Nigeria being accepted and coveted by the international investment community at large is indeed a most welcome development. LISTING STATUS

It is hoped that the existence of the new OTC platforms will encourage retail participation in bond trading which is virtually non-existent now Invitation to the Public Invitations to the Nigerian public with regard to investments in general are regulated by the Investment and Securities Act 2010 (ISA)18, the SEC Rules pursuant to the ISA, the NSE Listing Requirements, the Companies and Allied Matters Act 2010 (CAMA) and other relevant legislation/regulations. Conversion and Re-registration of Companies The majority of companies registered in Nigeria are private companies limited by shares. Therefore, in order for such companies to seek funds from the capital market, they must comply with the ISA requirements. They will need to take advantage of the provisions of CAMA which allows for conversion a company from private to public.

VALUE

DATE ISSUED

Listed on LSE

US$400M

20/11/2007

Listed on LSE

US$750M

19/07/2007

Fidelity Bank

Non - listed

US$250M

21/08/2007

Access Bank

Non - listed

US$300M

23/07/2007

First Bank of Nig Plc

Non - listed

₦100B

05/07/2007

FCMB Plc

Non - listed

US$100M

02/07/2007

UBA Plc

Non - listed

₦2.60B

23/02/2007

Figure 1

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SEC has over the years continued to emphasize its resolve to develop and ensure increased investor participation in the collective investment schemes Section 50 CAMA contains the process for the registration of a private company as public as follows: S. 50(1) – Subject to this section, a private company having a share capital may be re-registered as a public company if: 1. a special resolution that it should be so re-registered is passed; and 2. an application for reregistration is delivered to SEC together with the documents prescribed in sub section (3) of this section. The special resolution shall alter the company’s memorandum so that it states that the company is to be a public company. Registration of A Lien at the Central Securities Clearing Systems (CSCS) In Nigeria, the practice is that where a borrower intends to use dematerialised19 shares as security for a loan, a lien will be required to be placed at the Central Securities Clearing System (CSCS). This is done by filing a Joint Memorandum of Lien (JML). Once a lien has been placed, the CSCS will issue a letter advising that the lien placement has been received and the CSCS will thereafter move the secured shares to a CSCS Reserved Lien Account with the interest of the lender noted in the lien account. It is in the interest of the lender not to disburse funds until it receives the letter of confirmation of placement from the CSCS. The process of filling a JML at the CSCS is as follows: 1. The lender must obtain a current statement of stock position from CSCS Ltd. 2. A JML duly filed and executed by the authorised signatories

of the lender and the borrower requesting the CSCS to place a lien on specific quantity of the stock(s), must be registered at either the Stamp Duties Office or sworn to before a Commissioner for Oaths in any Court of Law. The JML should thereafter be forwarded to CSCS with the following documents: (a) A list of the authorised signatories that have the capacity to sign the relevant JML; (b) An undated letter signed by the borrower, authorising the lender to sell the stocks in the event of default at the expiration of the loan due date; (c) The lender, the borrower and the Stock-broking firm(s) may be required to confirm and/or consent to the lien agreement; (d) The draw down date and duration of the lien agreement must be specifically stated in the JML; and (e) A copy of the facility and security agreements. 3. The lender (and no other party) should advise CSCS

her/its obligation under the contract, the lender at the expiration of the loan due-date shall: (a) Inform CSCS of the default by the borrower and advise CSCS to remove the lien to enable sale to be effected. (b) With a copy of the undated letter written by the borrower to the lender further giving instructions/directives to CSCS for the purpose of the release and sale of the totality of the holdings through a mandated or named stock-broking firm, which is a member of the NSE. (c) CSCS, if satisfied that the procedure has been complied with, will be obliged to remove the lien on the stock(s) upon such information/instructions from the Lender after the expiration of the loan duedate without recourse to the borrower, when evidence of Notice of Default from lender to borrower is received/sighted by CSCS. (d) If the Debtor/Shareholder refuses to acknowledge receipt of the Notice of Default mentioned in paragraph ‘‘c” above, the lender should write

The introduction of the sukuk would further expand the capital market in Nigeria

to remove the lien placed on stocks en bloc when the borrower has discharged his/ her/its obligation under the contract. The stock(s), which should be listed on the letter of instructions from the lender, is/are moved back to the original stock-broking firm(s) from where the stock(s) was taken. 4. When the borrower defaults and/or fails to discharge his/

a letter to CSCS affirming such position/situation which may suffice for CSCS to release the stock(s) without recourse to the borrower. It shou ld be note d t h at a l ien is pl ace d on sh a res whose ow ner(s) is t he d i re ct bor rower(s) a nd not t h i rd pa r t y to t he c ont ract, wh ich fact t he lender must at test to, e x pressly or by i mpl ic at ion.

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Mergers and Acquisitions (M & A’s) In discussing M & A’s or business combinations within the Nigerian context, we have decided to focus on the policies put in place by the regulatory authorities in order to prevent a potential monopoly or undue advantage that may result from a merger or an acquisition. Anti-Monopoly Regulations Whenever required to consider a merger, the Commission determines whether or not the merger is likely to substantially prevent or lessen competition, by assessing the factors set out in section 121 (2) of the ISA. Section 121 (2) requires that when determining whether or not a merger is likely to substantially prevent or lessen competition, the Commission shall assess the strength of competition in the relevant market, and the probability that the company, in the market after the merger, will behave competitively or cooperatively, taking into account any factor that is relevant to competition in that market, including –

a) the actual and potential level of import competition in the market; b) the ease of entry into the market, including tariff and regulatory barriers; c) the level and trends of concentration, and history of collusion, in the market; d) the degree of countervailing power in the market; e) the dynamic characteristics of the market, including growth, innovation, and product differentiation; f) the nature and extent of vertical integration in the market; g) whether the business or part of the business of a party to the merger or proposed merger has failed or is likely to fail; and h) whether the merger will result in the removal of an effective competitor. If it appears that the merger is likely to substantially prevent or lessen competition, then the Commission has to further determine – i. whether or not the merger is likely to result in any

technological efficiency or other pro-competitive gain which will be greater than, and off-set, the effects of any prevention or lessening of competition, that may result or is likely to result from the merger, and would not likely be obtained if the merger is prevented, and ii. whether the merger can or cannot be justified on substantial public interest grounds by assessing the factors set out in subsection (3) Section 121 (3) of the ISA, when determining whether a merger can or cannot be justified on public interest grounds, the Commission considers the effect that the merger will have ona) a particular industrial sector or region; b) employment; c) the ability of small businesses to become competitive; and d) the ability of national industries to compete in international markets. 1 Adjumogobia & Okeke has advised on some of the major capital market transactions in Nigeria 2 Capital Assets Limited - research

Below is a table of selected companies listed on the Main Board of the NSE indicating performance in the capital market over a three (3) year period2 Company

Transnational Corp Forte Oil Plc

Opening Price (2011)

Current Market Price (15/07/2014)

Price Change

Price Appreciation (%)

0.50

5.82

5.32

1064.00

21.90

240.00

218.10

995.89

Presco Plc

6.53

38.06

31.53

482.85

Livestock Feeds Plc

0.63

3.10

2.47

392.06

International Breweries Plc

6.42

29.50

23.08

359.50

368.55

1112.00

743.45

201.72

9.30

27.50

18.20

195.70

Lafarge Wapco Plc.

40.00

117.60

77.60

194.00

Cadbury Nigeria Plc

25.62

74.25

48.63

189.81

Glaxo Smithkline Consumer Nig. Plc

26.60

69.00

42.40

159.40

7 Up Bottling Comp. Plc

39.00

100.03

61.03

156.49

Nigerian Brew Plc.

Nestle Nigeria Plc Stanbic Ibtc Holdings

77.00

172.22

95.22

123.66

Union Bank Nig. Plc

4.29

9.54

5.25

122.38

Okomu Oil Palm Plc

15.00

33.00

18.00

120.00

Dangote Cement Plc

120.00

240.99

120.99

100.83

25.94

52.00

26.06

100.46

1.15

2.30

1.15

100.00

Unilever Nig. Plc Evans Medical Plc

CONSTITUTIONAL LAW

Arianda Daphine, Makere University School of Law

Mini-skirt Police – Ugandan Style

Law Digest Autumn 2014

only bring one to the conclusion that the spirit behind the passing of the Act is to control female dress code and presentation of their bodies, a phenomenon that is necessary in a patriarchal society where men control and dominate women.

Arinda Daphine Makerere University School of Law

Considering the parliamentary debate, which accompanied the passage of the Act and the posterior events, one suspects that the motivation behind the legislation is the control of female dress code

ollowing the passing of the Anti Pornography Act 2014 (the “Act”) in February 2014, a number of women in Uganda were undressed in public for wearing short dresses and skirts. Although the Act does not explicitly mention women’s dressing per se, section 2 prohibits the exhibition of sexual parts primarily for sexual excitement. This article discusses how the female body is viewed as a sexual object and therefore clothes that reveal parts of the female body are impliedly restricted by the Act. Introduction In its long title, the Act is explained as “an Act to define and create the offence of pornography…” seemingly setting out the major objective and purpose of the Act. Considering that there is already legislation dealing with publication and distribution of pornographic materials,1 the stated raison d’être is suspect. Considering the parliamentary debate which accompanied the passage of the Act and the posterior events, one suspects that the motivation behind the legislation is the control of female dress code. While the legislation was being debated before parliament, it was marketed as the “Mini skirt Bill”, seeking to preserve morality by protecting men from the provoking nakedness of women and to protect women from rape that may result from such provocation.2 Following the passing of the Act, there were systematic events of men publicly undressing women they considered to be indecently dressed and even more shocking, a magistrate sentenced parties in a lawsuit before her to three hours imprisonment for wearing miniskirts.3 All these events can

Women are being undressed in the streets for wearing mini-skirts

The sexualisation of the female body Pornography as defined in section 2 of the Act is any presentation of a person’s sexual parts for primarily sexual excitement. The Act however does not define “sexual part”. As evidenced by the events already mentioned in the introduction, it can be said that any part that is likely to sexually arouse a man is a “sexual part”. Thighs, legs, the stomach, chest and buttocks are among the parts on a woman’s body that have been regarded sexual. The incidents referred to above, would suggest that the same parts on a man are not considered “sexual parts” and this would explain why so far, no man has been undressed

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It is extremely simplistic to suggest that a reduction in the incidence of rape and sexual abuse of women could be achieved by regulating the way women dress. or stopped by the police for wearing shorts that expose his thighs, or shirts that expose his chest or even for wearing trousers below the belt line, a fashion common among youthful men that often exposes their buttocks. This reaction from the public showcases the gender dynamics in Uganda, particularly urban Uganda; that men have a dominant superiority and while the state will intervene to legislate on female dress code, men go unaffected by the law which ideally should apply to everyone. In the public/private dichotomy of a patriarchal society, women predominantly occupy the private arena as domesticated wives to their husbands and their bodies exist sexually only for the husband’s pleasure.4 Consequently in such a society, a woman’s body should not be seen by other men not being her husband, especially if they are likely to gain sexual pleasure by looking at the woman. The idea that by a man looking at a woman, he is likely to get uncontrollably sexually excited is used to advance the patriarchal tendencies to control woman’s sexuality. In Africa, before colonisation, the traditional gab was animal skin and bark clothe. These materials were worn to cover the genitalia mostly and it was not uncommon to find a woman’s breasts, thighs and stomach exposed; yet this was neither considered pornography, nor likely to cause men to get uncontrollably sexually excited. This would suggest that this school of thought must be recent. Bell Hooks5 and Abraham Yvette6 show how racism and colonialism institutionalised the definition of black female bodies as objects of sexual

fantasy. Abraham uses the example of Sarah Bartman7 to explain how the stereotype that the female black body is sexual became concretised in the European colonialists. It would appear that the same sentiments were exported to Africa and particularly Uganda where previously nudity was separated from sex. Nudity was part of African culture as a way of life and this is reflected in the traditional attire of cultural dancers and among the Karamajong8 who do not dress their bodies in western garb but choose to be mostly naked. Now this cultural trait has been lost particularly because of the influence of the media which constantly portrays a naked black female as a sex object.9 Using legal establishment dominate women

It is extremely simplistic to suggest that reduction in the incidence of rape and sexual abuse of women could be achieved by regulating the way women dress. It is analogous to laying the fault for the high incidence of rape and sexual abuse of women at the doors of women. Hon. Simon Lokodo the Minister behind the Act propounded this as one of the justifications for the Act.10 The Act goes on to establish a committee that has representatives from the major institutions such as religion, culture, and the education system, (institutions which we believe have been partly responsible for the subordination of women) to monitor the operation of the Act.11 We therefore do not believe that the composition of this Committee is appropriate in the circumstance. Placing the authority to monitor the operation of this Act in these institutions is flawed and serves to further deprive women of the liberty to freely express themselves and participate in public life. The theme of the Act would appear to be that the woman is seen as subordinate to a man and if her dressing is going to lead a man into temptation, then she should be punished. The only act of enforcement since the passing of the Act so far has been the undressing of women. Ironically when you walk through Kampala, you

will be shocked to find young children staring at pornographic DVDs on the street, which has continued unabated. The Act therefore whether intentionally or otherwise, discriminately targets women and is unnecessary in a pluralist, democratic and secular country like Uganda. The 1950 Penal code and the 2011 Misuse of Computer Act create the offence of pornography; therefore the Act is not necessary. The focus of the law should be to limit access of children to pornography instead of creating a vigilante mini-skirt police state. 1 Section 23(4) of the Computer Misuse Act 2011creates the offence of making available pornographic materials to a child. Section 166 of the Penal Code Act makes it an offence to traffic in obscene publications. 2 Human Rights Centre Uganda, The Anti-Pornography Bill is more than just Miniskirts[online] available from < http:// www.hr cug.org/index.php?option=com_ content&view=article&id=191:the-antipornography-bill-is-about-more-than-justminiskirts&catid=60:articles&Itemid=191> accessed on 20th March, 2014 3 J.Oloka-Onyango Of Mice and Farmer’s Wives: Unveiling the Broader Picture Behind Recent Legislation in Uganda Presentation to HURIPEC, Public Dialogue held on March 25, 2014 Malik Jingo, Women get three-hour jail term for Wearing Miniskirts Daily Monitor, March 7, 2014 4 Christina Spaulding, “Anti Pornography Laws as a claim for Equal Respect: Feminism, Liberalism” Berkeley Journal of Gender, Law and Justice 4, no.1 (2013): 140 [online] Available at <www.scholarship.law.berkeley.edu/cgi/ viewcontent.cgi?article=1024&content=bglj> accessed on 8th March, 2014 5 Bell Hooks, Black Looks: Race and Representation (Boston, South End Press 1992) p. 61-78 6 Desiree Lewis, Representing African Sexualities in Sylvia Tamale, ed., African Sexualities: A Reader (Cape Town, Pambazuku Press,2011) p. 199 7 Sarah Bartman was a KhoiKhoi woman who was enslaved and exhibited in the 19th century Europe under the name Hottentot Venus. The public would pay to view her large buttocks and elongated labia. 8 A tribe in Northern Uganda who embrace nudity as part of their culture wear clothes mostly to cover up their genitalia. 9 Ibis 10 Human Rights Centre Uganda, op. Cit., n.2 11 Section 3 establishes the Pornography control Committee constituted of inter alia an education professional, a religious leader and a cultural leader.

Law Digest Autumn 2014

The opening of

AB & Davidâ&#x20AC;&#x2122;s ultra modern West African HQ in Accra on the 31st January 2014

Staff of AB& David and guests

L-R Attorney General & Minister of Justice, Marietta Brew Appiah-Oppong, Chief Justice, Mrs Justice Georgina Theodora Woode, guest and David Ofosu-Dorte

A tour of the ultra modern office

Law Digest Autumn 2014

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Anna Fordjuor and Isabel Boaten – Partners – AB & David

David Ofosu-Dorte and guest

Guests arriving

Front elevation of the building

Nana Godson-Amomoo – Senior Associate – AB & David and guest

Law Digest Autumn 2014

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SPECIAL FEATURE 73.17% of respondents believe that the quality and quantity of instructions will grow over the next 2 to 3 years (see figure 2) and 69.72% see a brighter future prospect for their firms (see figure 3). These figures seem to mirror the growth in the continent’s economy and the reemergence of the middle class with significant disposable income.

Regulations and capacity holding back growth of Law Firms in Africa

n April of this year, we conducted the biggest online survey of 200 senior African lawyers ever undertaken to elicit their views on the prospect for the continent’s legal services market, opportunities and challenges. We selected from the full spectrum of providers, from sole practice to large partnerships (see figure 1). The jurisdictions covered by the survey include South Africa, Nigeria, Ghana, Kenya, Uganda, Seychelles, Morocco, Egypt, Tanzania , Angola and Mauritius and 76 responses were received, with many bullish about the future.

Figure 2: Excluding normal seasonal changes, what changes do you expect to see with regards to the quality and quantity of instructions?

6+21+73 5.12%

21.71%

73.17%

Increase

3+4+93 70+25+5 Same

Decrease [5.12%]

Figure 1: Number of Partners in the firm 3%

Figure 3: Excluding normal seasonal changes, you expect that the business situation of your firm over the next 2 to 3 years will be? 69.72%

Seyi Clement – Editor - Law Digest

73.17% of respondents believe that the quality and quantity of instructions will grow over the next 2 to 3 years

93%

25.15%

Less than 5 [93%]

5.13%

Less than 10 but more than 5 [4%] More than 10 [3%]

Better

Same

Worse

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Compare this to the finding of a survey of law firms in the UK conducted by Royal Bank of Scotland in April 2014, where the bank concluded that, “Demand for legal services remains constrained. Accompanied by a continuing level of fee-earner overcapacity relative to the demand for legal services, pressure continues on billing rates, margins and profitability”.1 Despite the bullishness of the firms and the undeniable economic indicators, which both show upward trajectory, some common and worrying themes emerged from the survey, which should concern the African regulators, policy makers and legal education providers. In the current climate of expansion and integration, only 6.58% of respondents have offices in other African jurisdictions (see figure 4) and only 5.95% of respondents are considering opening office(s) in any other African jurisdiction over the next 2 – 3 years (see figure 5) Over 63.17% cited Regulatory Impediments and Capacity as barriers to their expansion. It is worthy of note that only 3.95% of respondents cited finance and only 2.63% cited personal reasons as an impediment to expansion (see figure 6).

Figure 5: Are you considering opening office(s) in another African jurisdiction over the next 2 to 3 years?

38.16% believe that the number of fee-earners they employ will increase over the reference period (see figure 7). 34.21% believe that the number will remain unchanged and 27.63% believe that the number will decrease. Whilst 55.26% believe that the number of partners in their firms will remain unchanged over the same period and only 42.11% believe that the number of partners will increase (see figure 8). More worrying for the profession is that 64.47% of respondents rate the level of preparedness of Africa’s law firms to take advantage of this projected demand for legal services as low (see figure 9).

4+96 38 34 + 28 + 3+ 30 20 43 + 4 3+4+93 5.95%

94.05%

Figure 7: Excluding normal natural wastage, what changes do you expect to see in the number of fee-earners (excluding Partners) in the firm over the next 2 to 3 years?

Yes

Figure 6: If No, what are the factors limiting your ability to expand beyond your current capacity?

38.16%

34.21%

27.63%

2.63%

3.95%

Figure 4: In how many African jurisdictions do you have offices?

42+55+3 Up

30.26%

2.63%

43.42%

3.95%

19.75%

Unchanged

Down

Figure 8: Excluding normal natural wastage, what changes do you expect to see in the number of partners in the firm over the next 2 to 3 years?

55.26%

Regulatory Impediments

Infrustructual Impediments

93.42%

Capacity Finance

Personal Choice

One

More than One but less than Three More than 3

42.11%

2.63%

A particular set of results however presents a conundrum of the continent’s law practices. Only

Unchanged

Down

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Figure 9: If you forecast an increase in instructions, how do you rate Africa’s law firms’ preparedness to take advantage of this increase?

36+64 35.53%

64.47%

Low

High

The question that pops to mind is; how will the increase in workload be met with an almost stagnant workforce, low level of preparedness and inadequate capacity? The answer to this conundrum may be found in the areas where many of the respondents forecast growth and the phenomenon we reported in Issue 5, spring 2014, “Race for Africa Legal Services Market”. 67.13% forecast growth in Construction and Project Finance, Energy & Natural Resources, Corporate Finance and M&A, Aviation, Shipping and International Trade, International Litigation and ADR; areas where it has been suggested that most African law firms lack capacity. Clement Foundufe of Latham & Watkins expressed this view when he said that “at the moment, very few local law firms can appreciate or handle the array of issues and complexities that arise in large transactions in Africa that have international participants, be they equity investors or debt providers. He commented further that, “local law firms do not have the expertise, capacity, skill-set and resources that international law firms can bring to these transactions. For example, many significant international law firms have a global network that

can easily staff 15 – 20 talented and experienced lawyers on multiple cross-border transactions simultaneously; something a local law firm would struggle to do”. In Issue 5, spring 2014, we reported that leading British and US law firms are spending more of their time eagerly chasing business in fastgrowing Africa. They are among an expanding swarm of international law firms who have been told to seek out opportunities and develop their practices on the vast continent. Moreover, global investors, notably from China, are backing huge energy, commodities and infrastructure projects on the continent. Where clients go, their legal advisers follow. And in the longer term, law firms also believe that the markets are primed for a consumer boom, with its growing middle class. The conclusion that one reaches from these two developments is that whilst the quality and quantity of instructions secured by African firms might grow over the next 2 to 3 years, unless the issues militating against growth and expansion of African firms are addressed quickly, the beneficiaries of the increase in instructions will not be African firms and lawyers, but the international law firms. In the first part of our report on the survey, we look at two specific areas of constraints identified in the survey, i.e. regulatory impediment and capacity, their expression and how they could be mitigated. In the next part of our report, we will consider the 3rd most cited cause of lack of expansion, i.e. infrastructural impediment, which 30.26% of respondents cited as an inhibiter of expansion. Regulatory impediment. The purpose of modern regulation of the legal practice, we believe, should be with the aim of maintaining proper standards of conduct, maintaining public confidence in the profession and protecting the public. We struggle to find any justification for regulatory requirements which go beyond these objectives. The African legal services market is littered with regulations which are unconnected with these objectives. The profession is still shackled by

Over 63.17% cited Regulatory Impediments and Capacity as barriers to their expansion. regulations which owe their origin to the colonial days, many of which have long been abandoned by the former colonial masters for their own legal profession. A prime example of which is the ban on advertising by lawyers. Some of the major jurisdictions in Africa, such as Nigeria still maintain this restriction. We have spoken to some of the regulators in Nigeria and no cogent reason has yet been proffered for the maintenance of this restriction. Whilst one understands the need to maintain a certain professional standard in terms of the contents and placement of advertisements, a complete ban is like using a sledgehammer to crack a nut, especially in the face of competition from international law firms which are allowed to advertise, not only in their own jurisdictions but also within Africa. Our own journal can count on the custom of law firms such as Hughes Hubbard Reed LLP as a regular advertiser. Some Regulators still operate on the premises that the client is local and firms are facing local competition, unfortunately, the fishing grounds are no longer the board rooms of Lagos, or Accra, but those of London, New York and Shanghai. Advertising is a normal and accepted marketing tool for any business, and its importance to a modern business cannot be underestimated. Another impediment which neither maintains standards, public confidence nor protects the public is the nationality requirement to practice in most African jurisdictions. The only justification for this requirement is protectionism. Whilst protectionism has its place in the global economic framework, however, if it is also hampering intra-Africa expansion as the survey would suggest that it is; then consideration should be given to revisiting this issue. We say this in light of the strident effort made by African governments at integration, as a recipe for economic development. African countries were and

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remain fully cognisant of the benefits of regional cooperation and integration. Africa has a long history of regional economic cooperation and integration. The 1960s and 1980s witnessed an intensification of the Continent’s regional integration and cooperation process. These periods saw the establishment of major regional integration schemes, ranging from the Preferential Trading Area (PTA) at the lower end of the integration spectrum to Economic Union at the upper end. Africa’s major regional integration groupings that are currently in operation include the Arab Maghreb Union (AMU), the Community of Sahel –Saharan States (CEN-SAD), the Common Market for Eastern and Southern Africa (COMESA), the Economic Community of Central African States (ECCAS), the Economic Community of West African States (ECOWAS), the Inter-Governmental Authority on Development (IGAD), and the Southern African Development Community (SADC), with memberships of 5, 18, 20, 10, 15, 7 and 14 states, respectively. The sub-sets of some of these major regional integration schemes are also involved in the implementation of Africa’s economic integration agenda. Such sub-regional groupings include the Central African Economic and Monetary Community (CEMAC), the Economic Community of the Great Lake Countries (CEPGL), the East African Community (EAC), the Indian Ocean Commission (IOC), the Mano River Union (MRU) and the West African Economic and Monetary Union (UEMOA). Africa’s regional economic integration and cooperation process is characterised by a multiplicity of schemes and overlapping memberships and mandates. Membership of regional integration in Africa has become so pervasive that there is no country on the Continent that does not belong to at least one grouping. Twenty-seven of the fifty-three Member States of the AU belong to two or more integration schemes. Among the major regions of the world, Africa has the highest concentration of economic integration and cooperation arrangements In pursuance of the objectives of regional integration and rapid socioeconomic development of Africa, the

OAU Summit of Heads of State and Government adopted the Lagos Plan of Action in 1980. The main strategy of the Plan for accelerating Africa’s development involved collective selfreliance, regional cooperation and integration. Africa’s drive towards regional integration was given a further boost in 1991 by the adoption of the Abuja Treaty establishing the African Economic Community (AEC). The primary objective of the AEC as stipulated in Article 4 of the Treaty is “to promote economic, social and cultural development and integration of African economies in order to increase economic self-reliance and promote an endogenous and selfsustained development”. The Treaty provides for the creation of a full Pan-African Economic Community through six stages extending over a period of 34 years, using the Regional Economic Communities as its building blocks. Thus, the post-independence period has witnessed the deepening and broadening of Africa’s integration process at both continental and regional levels. Unfortunately little attention has been paid to institutions such as the legal services within these initiatives. The understanding that attainment of the ideal of integration and regional development needs the support of non-market, institutions, such as legal services, has taken a long time to receive the recognition it deserves. This is surprising because so many economic models have implicitly or explicitly recognised the importance of institutions such as the legal services for development. Yet, the drive towards integration seems to have ignored the legal services, as a catalyst for this integration. We believe that if the nationality requirement in some of the African jurisdiction is replaced by membership of AEC, this will not only go a long way towards integration, but will remove one of the barriers to intra-African expansion by law firms. Lack of Capacity. Quality. We believe that this is an issue of quality and quantity, despite law practice still one of the most popular

career choices in Africa. The quality of young African lawyers has been of concern for some time. Law Digest was at a seminar hosted by the British Nigeria Law Forum on ‘Legal Education & Practice in Nigeria’ in September 2013 at which Mr. Lanre Onadeko, the Director General of the Nigerian Law School echoed the same concerns. f the quality of newly qualified practitioners is poor, then employing firms will need to devote a greater level of resources in upskilling their recruits. However, this in many cases is not an option for

Only 38.16% believe that the number of feeearners they employ will increase over the reference period many, as unemployment is very high. Even where the newly qualified practitioner is in employment, training can be sporadic. This is because some of the firms we spoke to either do not have a structured training programme for their feeearners, or does not have a set training budget. In some cases training has to be self-funded, which on the average salary of most newly qualified practice, may prove difficult. Also, in many African jurisdictions newly qualified practitioners are free to set up in practice immediately upon qualification, without any period of pupillage and in jurisdictions such as Nigeria, many take up this opportunity. In some cases, due to the high level of unemployment, selfemployment is the only viable option for newly qualified practitioners. This view was echoed by Gbolahan Elias SAN of G Elias & Co at the seminar referred to above. Whilst the exact number of firms set up by newly qualified lawyers is unknown, one of the local Bar Associations advised us that over 30% of start-up firms in their jurisdiction annually are by newly qualified lawyers with no post-call experience. The problem is not helped by the fact that in many African jurisdictions there is either no Continuous Professional Development (CPD) requirement or

Law Digest Autumn 2014

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where there is one; it is either not mandatory or not monitored. Structural The majority of African firms will be classified as small practices, with less than 50 fee-earners. With this kind of manpower, the capacity to take on some of the more significant transactions is very limited. Though we selected the leading African firms for our survey, the result still shows that only 2.63% of respondents employ more than 40 fee earners (see figure 10). The survey would seem to confirm Clement Foundufe’s view expressed above.

3+7+2268 Figure 10: Number of fee-earners in the firms 6.56%

2.63%

22.37%

68.42%

Less than 10

Between 10-20 Between 20-40 More than 40

We believe that the solutions to the capacity issue lay in the tightening and relaxation of regulations and mergers to create larger practices and grow economy of scale. If the aim of regulation is to maintain standards, public confidence and to protect the public, no other area of regulation of legal practice calls out for tightening up as the CPD regimes. Where none exist, one must be introduced as a matter

64.47% of respondents rate the level of preparedness of Africa’s law firms to take advantage of this projected demand for legal services as low of urgency. CPD must be mandatory and monitored; otherwise it will be as useful as a chocolate teapot. We have to accept that in some practice areas, Africa lacks the necessary capacity, but the international law firms do. African regulators must consider relaxing their regulations to encourage collaborations between local firms and international firms. Rules which could defer foreign qualified lawyers from practising in Africa should be reviewed. For example, the requirement that all intending to practice in Nigeria must attend the Nigeria Law School for 18 months fulltime needs to be revisited, as it can only deter foreign qualified lawyers. Whilst Chief O.C.J. Okocha SAN, the Chair of the Nigerian Council of Education at a conference hosted by the British Nigerian Law Forum on 12th September 2013 confirmed that the Council was looking at relaxing this regulation, no progress has been made at the time of print. We believe that the Ghanaian regulator may have struck the right balance between maintaining standards, and encouraging foreign lawyers’ participation. In Ghana, foreign lawyers are permitted to practice in Ghana providing that they have the required qualifications from their home jurisdiction, a letter of good-standing from their home bar, satisfied by the General Legal Council and pass the required exam in Ghanaian Constitutional law and the Customary Law of Ghana. Non-Ghanaians must demonstrate seven years PQE in a country with a compatible legal system, which would include most common law countries. It is quite evident already that African lawyers can and are gaining from the presence of international law firms, which have supported training programmes within African

legal communities, including the judiciaries and government legal departments. They are also active in the development and adoption of international standards in Africa. An example of the latter is Eversheds contributions through legal advice on reform and regulatory development and sponsorship towards professional qualifications in OHADA Law (Organisation on the Harmonisation of African Business Law). The Clifford Chance Africa Academy was launched in October 2013, hosting the ‘Introduction to Banking and Capital Markets’, for junior associates, in Lagos, Nigeria and further training sessions have been held in Ivory Coast, South Africa and Kenya. The Academy aims to provide the same high-quality, structured training programme to African lawyers as provided by the firm to its own lawyers. The Eversheds Africa Law Institute (EALI) was launched in October 2013. The EALI, is based on knowledge sharing and aimed at allowing member law firms across Africa to access training and knowledgesharing programmes while fostering commercial opportunities on a regional and international basis. To date, there are now 33 African law firms that have signed up as members of EALI which is now the largest Pan African legal network. In addition to such ventures, many international firms offer experience and training opportunities through secondments and initiatives such as International Lawyers for Africa (ILFA), launched in 2006 by leading International law firms to contribute to the development of legal skills and expertise of African lawyers. Gbenga Oyebode of Aluko & Oyebode (the largest practice in Nigeria) passionately expresses the need to allow opportunities for African firms to learn from international law firms, including through transactional work. He notes, “International law firms have developed a service delivery model that is important for those of us on the continent to pay attention to because it is about delivering better services to our clients. These clients are in some cases multinationals who operate all over the world and are used to a certain way (whether it is in the training of lawyers or in

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the technology used in the delivery of services or, even in the general ambience of the office) in which they want to engage with their lawyers. So it is important that we learn and are able to domesticate in our local environment, some of those skill-sets that we see and the methodologies by which international law firms have been able to gain the trust of their clients.” As aptly put by Akira Kawamura, a partner at Anderson Mori & Tomotsune and President of the International Bar Association (20112012), “The international law firms are functioning as the skills transfer vehicles through transactions and local partnership.” Conclusion Whilst we may have in this article treated the issues highlighted in our survey as distinct, there is no gainsaying that the issues and the solutions are interlinked. For example, as the quality of local expertise does vary significantly across the continent, the relaxation of the nationality requirement to practice in some African jurisdiction under the auspices of the AEC would allow skills exchange between

African countries. There are areas of law where some African jurisdictions are better developed due to their expose to major transactions as a result of their economic development, whilst others have not been so fortunate. Many of the major law firms on the continent especially in countries like South Africa, Nigeria, Ghana and Kenya have established some credibility and comparable skills set in the global market, as a result of their exposure to significant transaction. This phenomenon was acknowledged by Segun Osuntokun, of Berwin Leighton Paisner LLP, who noted in an interview with Law Digest in 2013 that local law firms in some jurisdictions have more experience working on complex transactions due to the level of investment in those countries and the exposure their lawyers have had to multi-jurisdictional legal issues. Invariably, smaller jurisdictions and countries with lesser, more concentrated economic activities and domestic investment do not provide enough opportunities for skillbuilding, specialisation and firm growth in the legal sector. Their small sizes and numbers limit their deal capacity. If African practitioners are allowed to practice in other African

jurisdictions, this can only assist in the development of the capacity in the less fortunate countries. On a positive note, whilst in most other jurisdictions, such as UK and the US, finance is usually cited as reason for lack of expansion, our survey would suggest that this is not the case with Africa, as only 3.95% cited finance as their impediment to expansion (see figure 6). This finding coupled with the low score of those citing personal reasons for lack of expansion, would suggest that African law firms have the financial capacity for fund expansion and a significant proportion are not personally opposed to expansion. This can only bode well for the continent if only the other constraints are addressed. In the next part of our report, we will consider the effect of the infrastructural gaps on expansion of law practices across the continent. 1 Building Tomorrow – A perspective on the legal market. http://www.google.co.uk/url?s a=t&rct=j&q=&esrc=s&frm=1&source=web&cd =1&ved=0CCAQFjAA&url=http%3A%2F%2Fw ww.rbs.co.uk%2FDownloads%2Fcorporate%2 F68961_Lay.pdf&ei=DArwU8ybIfKg7AbJl4HIC g&usg=AFQjCNFbXa5WV-5iHAP0ubwleptAqTf Daw&sig2=XghCZzvaIS2HrY7wS7iusQ&bvm= bv.73231344,d.ZGU.

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SPECIAL FEATURE

Domain Name Hijacking (a.k.a. Cybersquatting), Domain Name Disputes Resolution and the Entertainment Industry in Africa: A Strategic Approach to Brand Management

Prof. Uche Ewelukwa Ofodile LL.B. (Nig.), LL.M. (London), LL.M. (Harvard), SJD (Harvard)

ou are Lupita Nyong’o, Monalisa Chinda, Daddy Lumba, Michael Essien, Jackie Appiah, Genevieve Nnaji, Don Jazzy or 2face Idibia and you decide that it time to register a domain name and launch the website <Lupita Nyong’o.com>, <MonalisaChinda. com>, <DaddyLumba.com>, <MichaelEssien.com>, <JackieAppiah. com>, <GenevieveNnaji.com>, <DonJazzy.com>, and <2face Idibia. com> respectively. There is a problem, however. The problem is that when you try to register the domain name, you find out that someone else (one Mr. P. Trouble) already registered the same domain name as his. It gets worse. You discover that Mr. P. Trouble is not using the domain name for any legitimate purpose. In fact, you find that Mr. Trouble does not even want to use the domain name and has offered to transfer the domain name to the highest

bidder for $50,000.00. In the alternative, you find that Mr. P. Trouble is using the domain name in connection with a website that sells products or services that you do not approve of and do not want to be associated with. You would like to take Mr. P. Trouble to court to get the domain name cancelled or transferred to you but there is a problem there as well; you cannot find Mr. P. Trouble or you find out that he is based in another country or, perhaps, another continent. What then? The best option at this point may be a special dispute settlement mechanism established to deal with cases of bad faith registration and use of domain names that are identical or confusingly similar to trademarks or service marks belonging to others. Welcome to the world of domain name hijacking, cybersquatting, typosquatting and reverse domain name hijacking. Welcome to the special international arbitration system created by the Internet Corporation of Assigned Names and Numbers (“ICANN”). This special arbitration system centers around the Uniform Domain Name Dispute Resolution Policy (“UDRP” or “Policy”) and is administered by several Providers including the Arbitration and Mediation Centre of the World Intellectual Property Organisation (“WIPO”). High-profile actors, actresses and music artists such as Madonna, Sade, Julia Roberts, Pierce Brosnan, Nicole Kidman, Celine Dion, Will Smith, and Tom Cruise have dealt with cybersquatters and successfully used this mechanism. Sports figures including basketball player, Stephen J. Nash,1 football player, Mr. Ronaldo de Assis Moreira,2 and international tennis stars, Venus Williams and Serena Williams,3 have also used the system. This special dispute resolution mechanism is not reserved for those in the entertainment industry but has been used by giants in business sectors such as the Banking and Finance,4 Retail,5 Telecom, Automobile,6 and Food, Beverages and Restaurants.7 What is domain name hijacking (a.k.a. cybersquatting or domain name squatting)? What is the UDRP? And, why should you care if you are in the entertainment business? a. What is Domain Name Hijacking (A.K.A. Domain Squatting or Cybersquatting)? The terms “domain name hijacking,” “domain squatting,” and “cybersquatting” are often used inter-changeably. Domain name hijacking refers to a situation where a person opportunistically and in

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bad faith registers and/or uses a domain name that is identical or confusingly similar to the name or trademark of another. Corporations, celebrities, and other high profile individuals are frequently the target of cybersquatting. For example, following the birth of Blue Ivy Carter, the daughter of Beyoncé and Jay-Z, on January 7, 2012, unauthorized third parties rushed to register domain names that were identical or confusingly similar to her name. BlueIvyCarter. com (registered January 8, 2012), BlueIvyCarter.net (registered January 8, 2012), blueIvyCarter.me (registered January 13, 2012), and BlueIvyCarter. xxx (registered January 11, 2012)

Registering a domain name that is identical or confusingly similar to the personal or stage name of a celebrity creates problems for the celebrity and for the general public.

it for sale for £10,000.00, according the BBC News.9 Is Cybersquatting Illegal? Cybersquatting is not illegal per se and is not a crime in most countries. However some countries have passed laws that establish a cause of action for bad faith registration, traffic, or use of a domain name confusingly similar to, or dilutive of, a trademark or personal name. In the United States, the AntiCybersquatting Consumer Protection Act (ACPA)10 provides a cause of action for cybersquatting. Under the ACPA, courts can order the cancellation or transfer of a disputed domain name. Under the ACPA, a successful plaintiff can also recover defendant’s profit, damages, and the cost of the action. Is Cybersquatting Still a Problem Today? Judged by the number of complaints filed in the past eighteen months, cybersquatting is still a problem today. Stefani Germanotta (a.k.a. Lady Gaga) brought a cybersquatting case as recently as August 27, 2013.11 Other celebrities that filed cybersquatting

HRH Prince George of Cambridge was subject of hijacking within 24 hours of his official naming

are examples. HRH Prince George of Cambridge, born to the Duke and Duchess of Cambridge in July 2013, faced a similar problem. Less than 24 hours after his name was officially announced, over 200 domain names connected to his name were snapped up by unauthorised third parties.8 One such buyer, Matt James, registered the domain name < hrhprincegeorgecambridge.co.uk> on July 24th, 2013, and immediately put

complaints in the past eighteen months include: Australian model, Miranda Kerr (complaint filed March 21, 2013, and decided May 28, 2013),12 comedian and actor, Tracy Morgan (complaint filed January 12, 2013, and decided March 15, 2013),13 actress, singer, public persona and fashion designer, Paris Hilton (complaint filed November 20, 2013, and decided January 31, 2014),14 and DJ, music producer and record label

owner of note, Steve Angello (complaint filed November 16, 2012, and decided January 18, 2013).15 Cybersquatting is still a problem today. Unsurprisingly, more corporations and celebrities frequently register domain names related to their names as a precautionary measure. Buckingham Palace has reportedly registered a series of domain names relating to names of family members.16 In February 2014, an official at Buckingham Palace reportedly registered several domain names including <theprincessroyal.org>, <dukeofkent.org>, <countessofwesses. com>, and <earlandcountessofwessex. com>. Is Domain Name Squatting Harmful? Why should the entertainment industry in Africa take cybersquatting seriously? There are at least four dangers associated with cybersquatting: (1) the risk of tarnishment; (2) the danger of consumer deception and confusion; (3) frustration that comes with one’s inability to register and use a domain name that is identical or closely similar to one’s personal name or stage name; and (4) the problem of passing off and unjust enrichment because an unauthorised third party may be making profitable use of one’s name and brand. Cybersquatting can cause a celebrity’s name to become tarnished. For example, imagine someone using the domain name <donjazzy.com> to host a website that promotes the use of illegal drugs. Such an act would likely tarnish Don Jazzy’s brand and possibly destroy the goodwill in his name. In Paris Hilton v. John Daizy, InfoMedia D.O.O, the disputed domain name was <parishiltonpornvideos.com> which one John Daizy, InfoMedia D.O.O of Ljubljana, Slovenia, registered on November 1, 2013. Cybersquatting allows unscrupulous individuals to deceive the public and can frustrate the efforts of an actor, artist or business owner to acquire a domain name that is identical or very similar to his or her trademark or tradename. Imagine that Genevieve Nnaji wants to start a business, perhaps a bridal shop. Unfortunately, she finds out that Mr. P. Trouble already registered and acquired the domain name <genevievennaji.com.> and is using it to host a website that sells bridal gowns. Unless she fights back, the real Genevieve Nnaji will be forced to choose a different domain name and may end up with a name that is not very similar to her name. This was Lady Gaga’s experience. In Lady Gaga’s case, one Rola Dowens of Xiamen, Fujian, China, registered the

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domain name <ladygagadress.com> and used the same in connection with a website that was essentially a shopping site. Not surprising, Lady Gaga fought back and succeeded in having the disputed domain name transferred to

The fact that a celebrity already owns a domain name and website in his or her personal name or stage name does not mean that he or she is immune to cybersquatting her. b. Resolving Domain Name Disputes Industry: Main Advantages of UDRP Proceedings A victim of cybersquatting has several options. One option might be to pay off the cybersquatter and get him or her to transfer the domain name back to the victim. Another option might be to bring a lawsuit in a domestic court. Litigation in a domestic court is a good option if one is in a country like the United States where specific laws have been passed to address cybersquatting and to provide a cause of action for individuals and businesses who are be damaged by it. Litigation is also a good option when the cybersquatting victim and the alleged cybersquatter are in the same country. Unfortunately, this may not always be the case. Domestic arbitration is another option but works only when the necessary legal and institutional framework is in place in the relevant country. In South Africa, disputes relating to the .za domain name (South Africa) can now be resolved by the South African Institute of Intellectual Property Law (SAIIPL) pursuant to the Electronic Communications and Transactions Act of 2002 and implementing regulations. Given the challenges associated with litigation in domestic court and the fact that not every country in Africa has adopted laws similar to South Africa’s Electronic Communications and Transactions Act 2002, a fourth option for a victim of cybersquatting is UDRP proceedings. What is the UDRP? The UDRP sets out the terms and conditions that guide the resolution of domain name disputes that arise

between domain name registrants and third parties. The UDRP makes the special administrative proceedings mandatory and binding on some domain name registrants. The UDRP has been adopted by all ICANN-accredited registrars and is incorporated into every registration agreement between a domain name registrant and ICANNaccredited registrars. Overall, the UDRP domain name dispute resolution service is available for generic top-level domains such as: .aero, .biz, .com, .info, .jobs, .museum, .net, .org, .tel and .travel. It is also available for certain country top level domain names. For the UDRP to apply, a complainant must allege and prove three important facts: (i) that a particular domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights; (ii) that the domain name registrant has no rights or legitimate interests in respect of the domain name; and (iii) that the domain name was registered and is being used in bad faith. UDRP proceedings are conducted by approved administrativedispute-resolution service providers (Providers). WIPO is a UDRP dispute resolution Provider and over the years has processed over 27,000 cases. Ten Advantages of the UDRP Dispute Resolution Process There are many advantages to the UDRP Procedure. These advantages explain why many in the entertainment business choose to use the system instead of using domestic courts. Some of the advantages of the UDRP mechanism are: 1. Speed. The procedure is fast. In the absence of exceptional circumstances, a UDRP Panel established to hear a case is expected to forward its decision to the Provider within fourteen (14) days of its appointment (UDRP Rules, Para. 15(b)). WIPO’s UDRP Panels are explicitly required to ensure that administrative proceedings take place with due expedition. 2. Targeted Remedy. Two kinds of remedies are available under the UDRP. A Panel hearing a case can order that a disputed domain name be cancelled or transferred to the Complainant. 3. Multiple Domain Names. A single complaint can relate to more than one domain name if the domain names are registered by the same domain-name holder. For example, in a case involving Australian model, Miranda Kerr, the disputed

domain names were <kerrmiranda.com>, <mirandakerr.com>, <mirandakerrconnection.com> and <mirandakerrweb.com>. 4. No Jurisdictional Barrier. The UDRP procedure can be used even when a Complainant and an alleged cybersquatter reside in different countries and in different continents. In a case involving the domain name <paris-hillton.com>, the alleged cybersquatter was Dmitrij Timofeev of Saint-Petersburg, Russian Federation, while the complainant was based in California in the United States of America. 5. Control. UDRP Complainants exercise a measure of control over the proceedings in the sense that they have a choice in the selection of panel members and in the decision whether a given case will be heard by a single-member Panel or by a threemember Panel. According to the UDRP Rules, in a given case, if either the Complainant or the Respondent elects to have the dispute decided by a three-member Panel, they each can submit to the Provider the names and contact details of three candidates they would like to serve as one of the Panelists. In such a situation, the Provider is expected to endeavour to appoint one Panelist from the list of candidates provided by each of the Complainant and the Respondent. 6. Lack of Response From An Alleged Cybersquatter Not a Bar to a Decision. A Complainant can get a decision even when an alleged cybersquatter does not participate in the proceedings. According to paragraph 5(b)(i) of the UDRP Rules, it is expected of a respondent to: “respond specifically to the statements and allegations contained in the complaint and include any and all bases for the Respondent (domain name holder)’s right to retain registration and use of the disputed domain name…” Paragraph 5(e) of the Rules states that “if a Respondent does not submit a response, in the absence of exceptional circumstances, the Panel shall decide the dispute based upon the complaint.” In Paris Hilton v. Dmitrij Timofeev, the Respondent did not submit a response and the Panel concluded that “his default entitles the Panel to conclude that the [he] has no arguments or evidence to rebut the assertions of the Complainant.” Ultimately, the Panel made a decision “on the basis of the statements and documents

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UDRP procedure. Despite its many advantages, the UDRP procedure has some weaknesses. The remedy available under the procedure is limited to the cancellation or transfer of a disputed domain name and does not include monetary damages, defendant’s profit, attorney’s fees or costs. Furthermore, the UDRP procedure is most appropriate for clear cases of bad faith registration and use of domain names and is not very suitable for more complex cases. c. Helen Folasade Adu (a.k.a. Sade) v. An Alleged CyberSquatter

ICANN Singapore Conference discussing domain name hijacking

before it.” 7. Impartiality of Panel Members. The UDRP Rules requires that Panel Members be impartial and independent. Before accepting appointment, prospective panelists are required to disclose to the Provider any circumstances giving rise to justifiable doubt as to the Panelist’s impartiality or independence. Furthermore, if at any stage during an administrative proceeding, new circumstances arise that could give rise to justifiable doubt as to the impartiality or independence of a Panelist, the Panelist is required to promptly disclose such circumstances to the Provider and in such event, may be replaced. To further ensure impartiality, parties involved in a UDRP Proceeding are prohibited from having unilateral communications with Panel Members while the case is pending. 8. Cost. Document-based. No Inperson Hearing. UDRP proceedings are relatively cheaper than typical court proceedings largely because there are no unnecessary delays and adjournments, and there is no room for in-person hearings. The UDRP Rules specifically stipulates that “[t]here shall be no in-person hearings (including hearings by teleconference, videoconference, and web conference), unless the Panel determines, in its sole discretion and as an exceptional matter, that such a hearing is necessary for deciding the complaint.”

9. Written/Published Decisions. In some domestic jurisdictions, court decisions are rarely published and, when published, are generally inaccessible. This is not the case with UDRP decisions. Decisions of UDRP Panels are publicly available and accessible. The UDRP Policy stipulates that all decisions under the Policy will be published in full over the Internet, except when an Administrative Panel determines in an exceptional case to redact portions of its decision. The UDRP Rules further stipulate that decisions of UDRP Panels are to be in writing, must provide the reasons on which it is based, indicate the date on which they were rendered, and identify the name(s) of the Panelist(s) that rendered the decision. 10. Prompt Enforcement of Panel Decision. Decisions of UDRP Panels are relatively easy to enforce. Within three calendar days of receiving the decision of a Panel in a case, WIPO’s Arbitration and Mediation Center is required to communicate the full text of the decision to each Party in the case as well as the Registrar that registered the disputed domain name. Where a Panel rules that a disputed domain name should be cancelled or transferred to a complainant, the concerned registrar is required to do so without delay. When faced with cybersquatting, a celebrity has the option of using the

Sade v. Quantum Computer Services Inc.20 was a cybersquatting case decided by a WIPO Administrative Panel. The Complainant was Helen Folasade Adu (a.k.a. Sade) who is based in the United Kingdom and the Respondent was Quantum Computer Services Inc., a company based in the United States. The domain name in issue was <sade. com>. One person, James Bridgeman, served as Administrative Panelist in the case.

It is important that African celebrities take a more strategic approach to brand management and consider registering their trademarks in jurisdictions in and outside Africa. Sade v. Quantum Computer Services Inc.: Basic Facts The Complainant is a world-famous singer, songwriter and recording artist. The Respondent provides Internet users with “personalised” e-mail addresses by means of one of its www sites viz. “www. myownmail.com”. Internet users visiting the Respondent’s www site can select and assign to themselves a “novelty” e-mail address incorporating certain selected domain names. The Respondent registered numerous domain names in order to provide this service and categorised these domain names into various groupings including “music”, “TV”, “movies”, “funny”, and “sports”. One of the domain names available on the Respondent’s www site was <sade. com>. The domain name <sade.com> was originally listed in the “music” category

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and was subsequently moved to the “Internet” category. As is required for all cases brought under the UDRP, the Complainant had to prove the three facts mentioned above. i. Did Sade Have Trademark Rights in the Term “SADE”? Sade did not register the word “SADE” as her trademark. However, this fact did not end the enquiry into whether she had trademark rights in the word “SADE.” In the absence of any trademark registration, Sade asserted common law trademark rights in the word. Essentially, Sade offered evidence to show that she was universally known as “SADE” and had established significant common law trademark rights in jurisdictions throughout the world through the sales of records and her tours and appearances as a performing artist. To prove common law trademark rights in the word “SADE,” Sade submitted as evidence: (1) details of sales and chart positions of her albums and singles in the UK, the US, Germany, Italy, Japan, France and other territories together with details of the Gold and Platinum levels achieved by the sales of those recordings; (2) details, with date, of her numerous live performances (tours and concerts) in the U.K. and many countries around the world; (3) details of various awards she had received; and (4) details of revenue

that the Respondent had no rights to and legitimate interests in <sade. com>. In reaching this decision, the Administrative Panel was persuaded by several facts including: the fact that the domain name in question was registered for commercial purposes; the fact that the Respondent deliberately set out to associate the services it offered (e-mail services) with Sade by offering the service in the “music” section of its www site; and the fact that the Respondent registered the domain name in the name of “The Sade Internet Fan Club” in circumstances where the Respondent is not connected with any such fan club and no such entity actually exists. Also important to the Panel was the fact that the Respondent made no claim whatsoever to any right or interest in the disputed domain name, could not explain how it came to choose said domain name “sade.com”, and was not commonly known by the name “SADE”. iii. Did Sade Successfully Prove Bad Faith Registration and Use? The Administrative Panel found that the Respondent registered and used the disputed domain name in bad faith. According to Paragraph 4(b) of the UDRP, one of the factors that can indicate bad faith registration and use of a domain name is using a domain name intentionally to attract, for commercial

bad for the Respondent’s case was the fact that it had engaged in multiple domain name registrations. The Respondent was

Fame, wealth, popularity are not in themselves enough to prove trademark rights or service mark rights in a name essentially a serial cybersquatter. d. Beyoncé Knowles, Lady Gaga and Nicole Richie: Encounters With Serial Cybersquatters At first glance, Beyoncé Knowles, Lady Gaga and Nicole Richie do not appear to have much in common apart from the fact that all three are in the entertainment business. The three ladies have one thing in common though – they have all been victims of cybersquatting and fought back. Nicole Richie filed her complaint with WIPO on March 13, 2012 and a decision on the case was reached on April 19, 2012. Beyoncé Knowles filed her complaint with WIPO on August 25, 2010, and got a decision on October 15, 2010. Finally, Lady Gaga filed a complaint with WIPO on August 27, 2013 and got a decision

Stars like Lady Gaga, Paris Hilton and Beyonce have had to use UDRP proceedings to combat cybersquatters

that her merchandise generated. The Administrative Panel found that since 1983, the Complainant had continuously been known as, and had used the name “SADE” in the pursuit of her career as a singer and songwriter and in connection with sales of records, compact discs, videos, tickets for live performances, advertising and promotion, and merchandising. ii. Did Sade Successfully Establish that Respondent Had No Right to and Legitimate Interest in the Domain Name? The

Administrative

Panel

concluded

gain, Internet users to a website or other on-line location, by creating a likelihood of confusion with a Complainant’s mark. The Administrative Panel found this to be the case here. To the Administrative Panel, the fact that the Respondent clearly registered the disputed domain name under the name “The Sade Internet Fan Club” was an indication of an intention to represent that the domain name in question pertained to Sade. The Administrative Panel concluded that the Respondent registered the disputed domain name under a false name purely for the purpose of trading on Sade’s goodwill for its own financial gain. Also

on October 25, 2013. Interestingly, the same individual – Sonny Ahuja – was the target of the complaints that Beyoncé Knowles and Nicole Richie filed. In Beyoncé’s case, the disputed domain name was <beyoncefragrance.com>. With Nicole Richie, the disputed domain names were <nicolerichiefragrance. com> and <nicolerichieperfume.com>. In Lady Gaga’s case, the domain name in question was <ladygagadress.com>. Beyoncé Knowles v. Sonny Ahuja 21 Beyoncé is the internationally-known recording artist, actress and spokes model

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Celebrities cannot prevent legitimate uses of their name by third parties. However, they can prevent bad faith registration and use of domain names that are identical or confusingly similar to their trademarks

<beyoncefragrance.com> and noted the fact that it was uncontested that the Complainant had not licensed or otherwise authorised the Respondent to use the BEYONCÉ mark for any purpose. The fact that the Respondent was in the fragrance business did not allow the Respondent to register <beyoncefragrance.com>as his domain name, the Panel concluded. The Panel also found that the Respondent registered the domain name in bad faith because: (i) he knew of the Complainant at the time he registered the domain name; (ii) he registered the domain name in order to create an

Whilst Sade was able to prove trademark right, Sting was unsuccessful

who has achieved considerable fame and fortune. Beyoncé’s fame and success has allowed her to branch into other areas. In the world of fragrance, Beyoncé has not only worked as a spokeswoman for topselling fragrances but has also developed her own fragrance, Beyoncé Heat. The Respondent registered the domain name <beyoncefragrance.com> on November 21, 2008, and as of October 15, 2010, the domain name merely resolved to a website containing sponsored links relating to fragrances. Beyoncé established trademark rights in the term “BEYONCÉ by proving that she owned related United States trademark registrations and that she registered the said trademarks prior to the registration date of the domain name. The WIPO Administrative Panel established to hear the case further concluded that the domain name <beyoncefragrance.com> was identical or confusingly similar to the trademark BEYONCÉ and noted that “adding a generic term to a mark is not sufficient to avoid confusion.” The Administrative Panel also concluded that the Respondent did not have legitimate rights or interests in

association with Complainant; and (iii) he knew at the time he registered the domain name that he was not authorized to sell any of Beyoncé’s fragrances and that he was not a licensed re-seller of the fragrances. Having established all three elements, the Panel found for Beyoncé and ordered that the domain name <beyoncefragrance.com> be transferred to Beyoncé. Stefani Germanotta and Ate My Heart Inc. v. Rola Dowens 22 Like Beyoncé, Lady Gaga who is an internationally renowned recording artist and performer needs no introduction. Lady Gaga is a recognised fashion icon and has even received the Fashion Icon Award awarded by the Council of Fashion Designers of America. The Respondent in this case was Rola Dowens of Xiamen, Fujian, China. Rola Dowens registered the domain name <ladygagdress.com> on July 9, 2012, and the domain name was connected a website that operated as a Lady Gaga fan site and shopping site. The website featured photos of Lady

Gaga and offered clothing items for sale, sometimes by reference to the LADY GAGA trademark. The Administrative Panel established to decide this case concluded that Lady Gaga indeed had rights in the “LADY GAGA” trademark. Critical to this decision was the fact that Lady Gaga had trademark registrations for “LADY GAGA” in the United States of America as well as in China and was actively using the trade mark in in connection with clothing and other goods and services. The Administrative Panel also concluded that <ladygagadress.com> was identical or confusingly similar to the trademark “LADY GAGA.” The Administrative Panel also found that the Respondent had no rights or legitimate interests in respect of the domain name, noting that it was unable to conceive of any basis upon which the Respondent could sensibly be said to have any rights or legitimate interests in respect of the domain name. In this respect, the Panel was persuaded by the fact that the Respondent had never been an authorised representative or agent of Lady Gaga and was not commonly known as Lady Gaga. The Administrative Panel also concluded that the Respondent’s registration and use of the domain name <ladygagadress.com> was in bad faith and noted the fact that Lady Gaga did not grant a license or consent to the Respondent to use the LADY GAGA brand or her images. To the Panel, the evidence suggested that the intention of the Respondent was to attract for commercial gain by confusing and misleading Internet users into believing that the Respondent’s website and the products sold on it were authorised or endorsed by Lady Gaga. Nicole Richie v. Sonny Ahuja23 In Nicole Richie’s case, the disputed domain names were <nicolerichiefragrance.com> and <nicolerichieperfume.com> which Sonny Ahuja registered on September 28, 2008. The registration of the two domain names posed a major problem for Nicole Richie largely because she, like many celebrities, had plans to go into the fragrance business but had not gotten around to doing so by September 28, 2008, when Sonny Ahuja registered the said domain names.24 Although Nicole Richie already owned and maintained the website www.nicolerichie.com, she and her attorneys clearly saw the need to fight to get the disputed domain names cancelled or transferred to her. Notably, Nicole Richie did not own any registered trademark in the United States or elsewhere. However, she “Sade” successfully demonstrated common law trademark rights. The Administrative

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To prove common law trademark rights in a name, it is not necessary to show that such a right has been established in all the jurisdictions of the world. It is enough to show that one carries on a substantial business under the disputed name in a particular country

evidence indicating that the Respondent was in any way associated with Nicole Richie or that the Respondent had any authority, license or permission to use Nicole Richie’s trademark. The Panel also found bad faith registration and use in part because the Respondent attempted to attract, for commercial gain, Internet users to her websites by creating a likelihood of confusion with Complainant’s trademark and because the Respondent was a serial cybersquatter who had registered dozens of domain names, all of which infringe the rights of a celebrity and well-known fashion brands. Several lessons can be drawn from the encounters of Sade, Beyoncé, Nicole Richie, and Lady Gaga cybersquatters. 1. A strategic approach to brand management and trademark

The Royal Family has taken pre-emptive steps to protect Royal titles such as Countess of Wessex from being hijacked

Panel concluded that Nicole Richie had “strong common law rights in the trademark NICOLE RICHIE” because she provided evidence that showed that the term NICOLE RICHIE was used as an indication of the source of goods provided in trade or commerce and that, as a result of such use, the name had become distinctive of that source. The Panel also concluded that the disputed domain names were nearly identical and were confusingly similar to the trademark NICOLE RICHIE despite the addition of the words, “perfume” and “fragrance.” According to the Panel, “the addition of “perfume” or “fragrance” does not remove the similarity but increases the risk of confusion for consumers, as they would believe that the websites to which the Disputed Domain Names resolve are connected to Complainant and her services.” The Panel also concluded that the Respondent did not have rights or legitimate interests in the domain names persuaded by the fact that there was no

protection requires that African celebrities protect their trademarks by monitoring the physical and virtual world for encroachments on their brand routinely and taking action once encroachment is detected. 2. The fact that a cybersquatting victim and an alleged cybersquatter are in different countries or in different continents is not a bar to a UDRP Proceeding and should not discourage any one from taking necessary legal steps whenever cybersquatting is detected. 3. Personal names and stage names can serve as trademarks. However, proving trademark rights in a personal name or a stage name can be very challenging. While many celebrities have successfully established trademark rights in their names, some have not been so successful. The singer Gordon Sumner (a.k.a. “Sting”) could not satisfactorily prove trademark rights

in the name: STING.25 4. The burden is on a Complainant to prove that he or she has trademark rights in a name. Fame, wealth, popularity are not in themselves enough to prove trademark rights or service mark rights in a name. In Beyoncé Knowles v. Sonny Ahuja, the Panel held that “Regardless of how famous the Complainant may be, this does not lessen the Complainant’s burden of proof, a burden that requires the Complainant to prove trademark rights through appropriate evidence.” In Gordon Sumner, p/k/a Sting v Michael Urvan, the Panel held that “Although it is accepted that the Complainant is world famous under the name STING, it does not follow that he has rights in STING as a trademark or service mark.”26 5. The easiest way to prove rights in a trademark or a service mark is to show proof of trademark registration and proof of ownership of the registered mark. However, merely registering a mark may not always be enough to establish that the mark is valid. 6. In the absence of trademark registration or in the alternative, trademark rights can be proved by establishing common law rights in a name. In other words, the UDRP proceeding is applicable to unregistered trademarks and service marks in which common law rights subsist. Proving common law trademark rights is not easy, however. Worldwide fame, popularity and celebrity are not enough to establish common law trademark rights in a name. Equally, winning prestigious awards such as the Grammy Award or the Oscar is not enough to establish trademark rights in a personal name or a stage name, although winning such awards helps. 7. To prove common law trademark rights in a name, it is not necessary to show that such a right has been established in all the jurisdictions of the world. It is enough to show that one carries on a substantial business under the disputed name in a particular country. In Sade’s case, the Administrative Panel stated that it was satisfied that Sade “carrie[d] on a substantial business as a recording artist, songwriter, performing artist and is engaged in merchandising of products under her stage-name “SADE”. In Jeffrey Archer v. Alberta Hotrods tda CELEBRITY 1000, a WIPO Administrative Panel held that “a

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celebrity’s name can serve as a trademark when used to identify the celebrity’s performance services.” 8. Paragraph 4(a)(i) of the UDRP requires that a Complainant show that a disputed domain name is identical or confusingly similar to his or her trademark. What is the test for “confusing similarity”? According to one WIPO Administrative Panel, “The threshold test for confusing similarity involves the comparison between the trade mark and the domain name itself to determine likelihood of Internet user confusion.”27 9. For the purposes of assessing identity and confusing similarity, WIPO Panels typically ignore the generic domain suffix “.com”. A domain name will also be found to be confusingly similar to a trademark despite the addition of generic terms such as “dress,” or “fashion” to the said domain name. In Lady Gaga’s case, the Panel concluded that the registered trade mark LADY GAGA was the dominant portion of the domain name <ladygagadress. com> and that the addition of the word “dress” did nothing to minimise the risk of confusion. Equally, in Beyonce’s case, the Panel held that the domain name <beyoncefragrance.com> was clearly dominated by the BEYONCÉ mark and noted that it was well settled that adding a generic term to a mark is not sufficient to avoid confusion. 10. The fact that a celebrity already owns a domain name and website in his or her personal name or stage name does not mean that he or she is immune to cybersquatting. A determined cybersquatter can still register domain names that are confusingly similar to a celebrity’s name by merely adding generic terms at the end. This was the case with Nicole Richie. Although Nicole Richie already owned and maintained the website “www.nicolerichie. com”, which focuses on fashion and beauty, the Respondent’s domain names<nicolerichiefragrance.com> and <nicolerichieperfume.com> were still problematic because of the danger of consumer confusion and unjust enrichment. Conclusion Registering a domain name that is identical or confusingly similar to the personal or stage name of a celebrity creates problems for the celebrity and for the general public. Not only is the targeted celebrity prevented from

acquiring and making legitimate use of domain name that is identical or similar to his or her name, but the general public is also frequently misled into thinking that the domain name in question is licensed, authorised or sponsored by the targeted celebrity. Celebrities cannot prevent legitimate uses of their name by third parties. However, they can prevent bad faith registration and use of domain names that are identical or confusingly similar to their trademarks. The starting point of course is effective trademark protection. According to WIPO, a trademark “is a sign capable of distinguishing the goods or services produced or provided by one enterprise from those of other enterprises.”28 For many businesses, particularly in developed countries and emerging markets, trademarks are valuable and highly-prized business assets. Quite apart from helping to distinguish one’s goods and services from those of others, trademarks can be used to obtain financing from financial institutions and can provide an important revenue stream via licensing. It is important that African celebrities take a more strategic approach to brand management and consider registering their trademarks in jurisdictions in and outside Africa. Many celebrities in the West are very savvy about registering their personal names and stage names as trademarks and service marks. African celebrities must begin to do the same. Australian Model, Miranda Kerr, owns a trade mark registration for her name MIRANDA KERR which was registered in Australia on March 28, 2012. The term “LADY GAGA” is registered as a trademark in the United States of America as well as China. Paris Hilton registered the trademark “PARIS HILTON” in several jurisdictions including the United States, Ukraine and the European Union. In the absence of trademark registration or in the alternative, common law trademark rights will suffice. However, proving common law trademark rights is not easy. Worldwide fame, popularity and celebrity are not enough to establish common law trademark rights in a name. To establish common law trademark rights in a name, a Complainant must prove that the he or she has obtained a significant degree of recognition for services rendered under a given name and that that name has come to identify and distinguish the Complainant’s products or services in trade or commerce. In other words, the Complainant must prove that the name has acquired secondary meaning. Overall, Sade, Beyoncé, Nicole Richie and Lady Gaga teach that celebrities

must be vigilant about possible encroachments on their goodwill and trademarks. Vigilance in the physical and virtual marketplace has become a very important and necessary brand management strategy for businesses and entertainers today.

1 Stephen J. Nash aka Steve Nash v. HOOPology. com, Case No. D2009-0225. 2 Ronaldo de Assis Moreira v. Goldmark - Cd Webb, Case No. D2004-0827. 3 Serena Williams and Venus Williams v. Eileen White Byrne and Allgolfconsultancy, Case No. D 2000-1673. 4 J.P. Morgan & Co., Incorporated and Morgan Guaranty Trust Company of New York v. Resource Marketing, Case No. D2000-0035 5 Wal-Mart Stores Inc. v. Frank Warmath, Case No. DTV2008-0013 6 Volvo Trademark Holding AB v. Cup International Limited, Case No D2000-0338 7 Burger King Corporation v. Burger King S.R.L., Case No. DRO2008-0012 8 Rebecca English, ‘Cybersquatters’ cash in on Prince George’s name as they register nearly 200 domain names connected to the royal baby, Daily Mail, 25 July 2013. http://www. dailymail.co.uk/news/article-2377978/Royalbaby-Cybersquatters-cash-Prince-Georgesregistering-nearly-200-domain-names.html 9 Royal baby: Cybersquatters descend on Prince George domains, BBC News, 26 July 2013. http://www.bbc.com/news/ technology-23464598 10 15 U.S.C. § 1125(d). 11 Stefani Germanotta and Ate My Heart Inc. v. Rola Dowens, Case No. D2013-1506. 12 Miranda Kerr v. orangesarecool.com, Case No. D2013-0553. 13 Tracy Morgan v. Fundacion Private Whois / PPA Media Services, Ryan G Foo, Case No. D2013-0078. 14 Paris Hilton v. John Daizy, InfoMedia D.O.O, Case No. D2013-1979. 15 Steve Angello v. Adam Kyron, Case No. D2012-2261. 16 Emily Gosden, Buckingham Palace Buys Up Roral Family Domain Names, The Telegraph, 23 February 2014. http://www.telegraph.co.uk/ news/uknews/prince-george/10656955/ Buckingham-Palace-buys-up-Royal-Familydomain-names.html 17 Paris Hilton v. Dmitrij Timofeev, Case No. D2010-1905. 18 Id. 19 Id. 20 Case No. D2000-0794. 21 Beyoncé Knowles v. Sonny Ahuja, Case No. D2010-1431. 22 Case No. D2013-1506. 23 Case No. D2012-0500. 24 In 2011, Nicole Richie announced a new line of fragrance products to be sold under the trademark NICOLE RICHIE, and launched this new line in September 2012. 25 Gordon Sumner, p/k/a Sting v Michael Urvan, Case No. D2000-0596. 26 Id. 27 Stefani Germanotta and Ate My Heart Inc. v. Rola Dowens, Case No. D2013-1506. 28 World Intellectual Property Organization, MAKING A MARK: AN INTRODUCTION TO TRADEMARKS FOR SMALL AND MEDIUMSIZED ENTERPRISES 5 (2006)

Lawyer in the News GEORGE ETOMI

VISIONARY BUSINESS LAWYER AND GENTLEMAN

orn in Ilesha, Osun State and raised in Okrika, Rivers State, George Etomi has shown that his vision and passion for Nigeria knows no tribal bounds. From his work in the formation of the Section on Business Law of the Nigerian Bar Association, to his services to the International Bar Association, George Etomi’s drive to raise the standard of business law practice in Nigeria is unrelenting. From his fellowship conferment by the Centre for International Legal Studies in Austria and the Nigerian Institute of Advanced Legal Studies, to his award of the National Productivity Order of Merit for his contribution to the development of law by President Jonathan Goodluck of Nigeria, it is clear that his efforts and expertise have not gone unnoticed. George Etomi has been involved in the development of Nigeria’s business law for over 30 years. He has spearheaded a significant number of cutting edge and ground breaking transactions in Nigeria. He is recognised and consulted internationally on Nigerian business law. George Etomi worked on the first batch of the privatisation of the telecommunications sector in Nigeria and is extensively involved in the privatisation of the power sector as well. Furthermore, not many lawyers can boast of being involved in the enablement of a capital city, George belongs to this exclusive club of elite lawyers, as he worked extensively on numerous projects that brought about the realisation of the “Abuja dream” following relocation of Nigeria’s capital from Lagos to Abuja. However, we are not honouring George for his contribution to business law practice; that has been done by loftier organisations than ours. We are not honouring George for his crusade to improve the standard of legal practice in Nigeria; the success of the Section on Business Law of the Nigerian Bar Association already attests to that. It is for his philanthropic activities via the M & G Etomi Foundation, which has earned George our readers’ admiration and respect. The Foundation was set up by George and his twin brother Dr. Michael Etomi (Immediate Past President, Association of Nigerian Physicians in the Americas (ANPA)) to break the harsh cycle of poverty in the Niger-Delta area following oil exploration activities. This is why George U Etomi is our Lawyer in the News.

R V

with

George Etomi By Seyi Clement

Have you always wanted to be a lawyer? I was never quite sure what I wanted to be, but I was torn between two equally powerful forces in the family about my career. One, headed by my eldest brother – Dr. Cyril Etomi FRCS, a surgeon, wanted my twin brother and I to become doctors like him and from procuring medical examination forms to driving us to the examination centers, he left no stone unturned to ensure we became medical doctors. On the other hand, my brother-inlaw – Late Mr. Abayomi Sogbesan, Senior Advocate of Nigeria (SAN) was a strong influence in guiding my decision to study law because of the way he carried himself. He was confident, well-mannered and very intelligent. What finally swayed me

in the direction of law, was when he (Mr. Sogbesan) showed up once with his bosom friend – Late Mr. Debo Akande, SAN to see my Dad. I was star-struck by these “freshly minted” Yale post-graduate lawyers and I thought law was it. Who or what has had the most profound influence on your life and your career? A lot of people along the line have shaped my life and career. I would start with my grandparents who I grew up with in Okirika, River State. My granddad, in particular was so literate for his time he was an author, typist, wrote in short hand and was one of the best organists that I can remember. He not only impacted these skills in all of his

grandchildren, he also put us in the choir. This was a solid foundation for my spiritual life. My parents in different ways were disciplinarians and between carrot and stick, they made sure we all stayed on the straight and narrow part of life. I greatly appreciate that. On the professional front, after Mr. Sogbesan had come into my life as my brother-in-law and influenced my university life, including the period I spent at the London School of Economics (LSE) for my LLM; I took up a job in the law firm of Chris Ogunbanjo & Co. (CHRISCO). It was undoubtedly the number one commercial law firm in the country at the time. Chief Ogunbanjo himself has been one of the most remarkable

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which was sadly truncated following the collapse of Shagari’s regime; and we did a lot of work in the movement of Nigeria’s capital from Lagos to Abuja. In all of this, one thing was uppermost in my mind, and that was, that Nigerian lawyers needed to be more involved in commercial law. You have worked on numerous infrastructure projects, which of these projects has given you the most satisfaction both as a lawyer and a Nigerian and which have been the most challenging?

Conferment of George Etomi as a fellow of the Nigerian Institute of Advanced Legal Studies

influences in my legal career. Until I met him, I knew very little about commercial law; I was more inclined to academics and infact took up a teaching job at the University of Lagos straight from LSE. Throughout the nearly four years I spent at CHRISCO, I worked directly with Chief Ogunbanjo and he opened this whole new world of commercial law practice to me. Not only did he mentor me, he exposed me to the finest ideals of commercial law practice. I am forever grateful to him. I must say though, later in life, after I got married to my beautiful and lovely wife – Efe, my father-in-law, the Late Hon. Justice E.O.I. Akpata (of the Supreme Court and INEC) became the “father” I lost when I was only 16 years of age. His wise counsel and his concern for me always spurred me on. Your name is virtually synonymous with business law in Nigeria; how did this come about? As I mentioned earlier, my exposure

at CHRISCO opened my eyes to this phenomenal and interesting area of law. CHRISCO was virtually the only commercial law firm that competed with the expatriate law firms in Nigeria at the time and Chief Ogunbanjo believed in getting the brightest and the best brains to enable him stay ahead of the competition. During this time, the second phase of the indigenisation process had started and Chief Ogunbanjo believed that it was important for indigenous law firms to play in the arena previously occupied by international firms. Consequently, very early on in my career, I was exposed to some of the most esoteric areas of commercial law practice that was developed at the time. It was therefore no surprise, that when I left to start my own firm, I was determined to benchmark the quality of our work with international standards. At the time, the banking sector was opening up to reforms which saw the entry of international banks like CITI Bank, whom we worked with. We were also exposed to legal work on the Metroline Project,

I’ll mention two projects in this regard and for totally different reasons. The first is “the Metroline Project”. Although this project was never realised in the end and painfully so; the amount of pioneering legal work that it involved was quite challenging. If you recall, this was the project which would have given Lagos State its first mass transit rail system. On the foreign side, we acted for a consortium of seventeen French companies that had come together to execute different parts of the project. Working with our foreign colleagues, we handled every aspect to do with labour issues, manufacturing of various parts including the coaches, procurement contracts and all the conflict of law issues that these raised. At home, we had to deal with right of way issues, acquisition of sites for stations and residences, local employment and procurement contracts and government relationships. In the end, poor politics in Nigeria following the collapse of the Shagari administration led to its cancellation. Attendant issues to do with probe panels, arbitrations, and other dispute resolution mechanisms posed separate challenges. Had this project been realised, Lagos and by extension Nigeria would have tackled one of its most fundamental infrastructure problems. It would have been the catalyst required for our industrial revolution. The second one is the successful story of the telecommunications revolution in Nigeria. We were the first set of lawyers who acted for MTN in

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their quest to be part of the Nigerian telecommunications scene. With little to go by the way of precedent, we had to rummage through what MTN had done in other previously privatised environments in Africa, to develop a template for the Nigerian venture. We are proud that we pulled this off and the recent rebasing of the Nigerian economy (making it the largest in Africa) largely rode on the back of the telecommunications revolution.

epileptic or totally abandoned. What do the African law firms need to do to meet the challenges of some of these complex transactions?

that the federal government needed to hand off certain areas of the economy for greater efficiency. At that time, telecommunications and power were identified. Our firm was briefed to work on the legal side of

A lot has been said and written about infrastructure development in Africa, what would you say are the challenges Africa faces in term of infrastructure development? In my opinion, Africa faces three challenges in the area of infrastructure development. First is the weak political system prevalent on the continent, which creates doubts in the minds of investors willing to make long-term commitments on the continent. Even though many African countries have democracies, these are at best very fragile and the near monopoly of power exercised by a dominant party means that corruption and the lack of rule of law impedes progress for infrastructure development. Secondly, the lack of capital is an inhibiting factor as well. Very few African countries can afford the capital that is required for sustained infrastructural development. Many of them spend over 80% of their revenue on recurrent expenditure. Even Nigeria, with all its huge revenue from oil sales; struggles with this phenomenon. Thirdly, the dearth of technology means that African countries need to practically import everything they require, including skilled labour for infrastructural projects. As a result, the cost to finally realise these projects is so prohibitive that the only way they can be run is for those services to be subsidised. This means that from the outset, the economic viability of these projects are compromised. The consequence is that replacements are hardly made, modernisation is far-fetched and in a matter of years, they become

Mr & Mrs George Etomi at the Fellowship Conferment at the Nigerian Institute of Advanced Legal Studies in December 2013

African law firms need to collaborate more with foreign firms that have the experience in complex transactions on a mutually beneficial basis. Incidentally, I am an adviser to the International Trade in Legal Services Committee of the Bar Issues Commission of the IBA, which is defining the rules for cross-border legal services so as to create equity between countries that import and export legal services. What role could the international law firms play in the development of the local legal expertise? This is tied closely to the answer above. It is important for international law firms to move quickly to allay the suspicions of local law firms about being totally sidelined in their own countries only because they have to import legal services. Hopefully, the work being done at the IBA level on behalf of the WTO will address these concerns. You have recently been involved in the power sector reforms in Nigeria. How is this going? During the short regime of General Abdulsalami, it was recognised

the anticipated liberalisation of these sectors. At the time, we were working with the Technical Committee on Privatisation and Commercialisation (TCPC), the precursor to the Bureau of Public Enterprises (BPE). Although the advent of BPE changed the game plan, my interest in telecoms and power was kindled, because I always believed that the true potential of the Nigerian economy could only be realised with the active participation of the private sector in the growth and development of the economy. What do you see as the role of the legal profession in this reform? First and foremost, this is a new growth area for Nigerian lawyers and we must recognise that we need to collaborate with firms abroad who have trodden this path. For example, our firm George Etomi & Partners, worked with Norton Rose on behalf of one of the successful bidders on the distribution side. The collaboration was very rewarding. Secondly, the world over, the power sector presents massive job opportunities for lawyers and these range from negotiating and drafting transaction documents, to in-house counsel work. Compliance also plays a very big role here. Some of the technical partners we have

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political will to follow through with the reforms exist; lending institutions are pro-active and international support is encouraging. Without a shadow of doubt, this is the growth area in Nigeria today. You have been credited with guiding the Nigerian Bar Association Section on Business Law to the influential position it currently occupies, how did you become involved with the organisation?

[L-R] Dr. M. Etomi, H.E. Raji Fashola - Govenor Lagos State, Geroge Etomi at the Geroge Etomi & Partner 30th Anniversary Lecture

worked with, have back in their home bases, in-house counsel population of nearly 200 lawyers and also retain significant numbers of external counsel. There is so much to do. At the just concluded 8th Section on Business Law conference of the Nigerian Bar Association, I chaired the session to do with the â&#x20AC;&#x153;Power Master class for Young Lawyersâ&#x20AC;?. The idea behind this is that these reforms in my opinion have come to stay; power is a game changer. It will unleash the vast potential of Nigeria, as it is the fulcrum upon which most economic activities revolve. However, lawyers owe themselves the responsibility to understand how this unique area of law can be beneficial to them by attending courses and workshops on the power industry. What challenges do you see for investors in the Nigerian power sector and how can the legal profession assist in dealing with these challenges? The first challenge I see for investors is, understanding the legal and regulatory framework upon which the sector operates. To do this, they must get good lawyers to work them in this area. The second, is dealing with the whole infrastructural deficit

in Nigeria, which makes doing business generally more difficult here. Thirdly, the transition from a wholly public owned and run utility, to one in which the private sector now participates in generation and distribution will produce a lot of grey areas. Happily, Nigerian Electricity Regulatory Commission (NERC) is made up of seasoned professionals who will help maintain balance in the industry. Fourthly, one of the biggest challenges will be the availability of gas to power most of the thermal plants that are at various stages of completion. Unfortunately, the gas master plan has lagged behind the electricity reforms and so even when a lot of these plants, which are expected to give us close to 10,000MW of electricity in the next one year are ready, they will struggle to get gas to fire them. Again, there are transmission challenges. The Transmission Company of Nigeria was not privatised and has instead been contracted out to Manitoba Hydro to manage. In my opinion, this represents a weak link in the entire privatisation exercise. What we are already seeing is that decades of neglect in this sector have meant that there are a lot of transmission losses which can distort projections. However, all said and done, the opportunities in this area for investors are vast; the

In 2000, I was invited by the then President of the NBA, Mr. O.C.J. Okocha SAN, to work with him at the national level. The involvement with the NBA opened my eyes to how commercial practitioners law; in-house counsel and other lawyers in business generally, were left out of NBA activities. I felt the NBA was not functioning at its optimum by not involving commercial law practitioners in its activities. I suggested to OCJ that a special section be created for business law practitioners. He agreed with me and moved to set up a committee which I chaired to work out the modalities. On his part, he saw to the amendment of the NBA constitution to allow for the creation of a section on business law. However, his tenure was over before the section could be created and so it fell on his successor, Chief Wole Olanipekun SAN, to take up the task. He opted for the IBA model and set up another committee headed by Mrs. Modupe Akintola to work out the modalities to achieve this. Thereafter, two sections were created, that is - a SBL and a Section on Legal Practice. I was in that committee and so was Mrs. Funke Adekoya, SAN (then first Vice President, NBA) and Mr. Dele Adesina, SAN (then General Secretary, NBA). Just before his tenure ended, the two sections were created and I was made the first chairman of the Section on Business Law; while Mallam Yusuf Ali, SAN was made the first chair of the Section on Legal Practice. It however fell on Mr. Bayo Ojo, SAN who succeeded Chief Olanipekun, SAN to formally make a public presentation of the Sections in 2004. I went to work immediately and called

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a stakeholders meeting of business law practitioners, whom it took a lot to convince to believe that the NBA was serious. I was lucky to secure their buy-in into a project that we dreamt would bring out the objectives of the SBL. The vision behind the project was to raise the bar in legal practice in Nigeria by providing the necessary tools for members of the profession to establish and enforce global standards in the activities of the Section, and to ensure that legal practitioners, especially young lawyers, did not have to leave the country to experience international quality in business law activities and practice. One of the cardinal principles was to involve the business community as well as policy makers in all the activities of the section, so as to ensure that the activities were not reduced to mere talk shops, but to influence advancement in legal practice, policy, business development and government action. We had all year round activities powered through the committees and professional organisations. However, the most visible, and perhaps the most influential event of the section was its annual business law conference. The conference covered diverse areas of law, business and politics. It also brought together legal practitioners, business people, government officials and academics to discuss topical issues in legal practice and national development. One thing that made me particularly proud, is that over the years it has served as a pool for Nigerian lawyers in the diaspora to come back home and ignited the interest of foreign legal practitioners about business law in Nigeria. It was and still is the most influential section of the NBA and has through its activities internationalised the NBA. Currently you operate a firm with 4 partners and over 20 associates; what qualities do you look for in the recruitment of partners and associates? The recruitment of partners and associates like with any close

relationship works on compatibility and productivity. Any firm that is able to combine their ability to bring in work, execute them to the highest international standards and get paid for it is the firm to beat. So we look for partners and associates who can in various combinations contribute to this role.

now put pressure on the Nigerian Law School which was built to deal with a defined number of law graduates but now has to accommodate nearly ten times that number. Quality is bound to suffer.

The quality of our young and upcoming lawyers has been a source of concern; do you share in this concern and where do you think the problems stem from?

The solution lies in continuing and continuous legal education of young lawyers. This was one of the reasons as the chair of the SBL; I ensured that many of our lawyers were exposed to international style legal practice through the year round continuing legal education program we organised. The other Sections too started the same thing. Going forward, I recommend that the Sections be strengthened so they can play a more direct role in the professional development of

The quality of our young lawyers is tied to the general problem of overall quality issues that Nigeria has seen in the recent past. The first issue one identifies here is that when the federal government took over most tertiary institutions, they emphasised quantity at the expense of quality. So

How can we improve the quality of our young lawyers?

Georg Etomi with his daughters

unlike in my time, where we were no more than sixty law students in the faculty which meant that we had very close interactions at tutorials with our lecturers; we now have law faculties with over a thousand students without a proportional increase in the number of lecturers or indeed facilities. Many law graduates today confess that they go through university without knowing their lecturers. In turn, these law faculties

young lawyers. This way, they can be insulated from the wider Bar politics and concentrate on developing the skills of practitioners. On the part of the Council for Legal Education, there is a need for them to update the curriculum of the Law School to make it more practical. I believe Law School students should spend more time in the practical aspect that is chambers and court attachment, than they do presently so that they

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can become more familiar with the practical aspects of the law. What are your career highs and lows so far? Career highs would be, being a foundation member of the second generation of commercial law firms in Nigeria; pioneering the SBL to achieve the enviable heights that is internationally acknowledged; representing Nigeria on the UNGA committee on legal drafting; being honoured as a fellow by the Center for International Legal Studies in Austria; being given a similar honour by the Nigerian Institute of Advanced Legal Studies; naming of the George Etomi Centre for Strategic Investment and Corporate Governance with a professorial chair to go with it and most recently, being made an adviser to the International Trade in Legal Services Committee of the Bar Issues Commission of the International Bar Association (IBA). However, the best high was getting married to my very supportive, beautiful and brilliant wife, Efe, who herself is a partner in the prestigious Chief Rotimi Williams Chambers. No

low that I consider significant. You were recently awarded the National Productivity Order of Merit for contribution to the development of law by the President, how do you feel about this award? I feel very proud that somebody somewhere, not least my country takes notice of the modest contribution I am making towards the development of law in this country. I hope it serves as an inspiration to other lawyers especially the younger generation so they can be more public spirited in their contribution to the legal system. I will continue to strive to do even better. You are involved in various philanthropic activities, which of those philanthropic activities are you most passionate about? I have a foundation with my twin brother, Michael – the M & G Etomi Foundation which seeks to break the harsh cycle of poverty which has riddled most residents of the NigerDelta area following oil exploration activities. We do this by creating programs and activities to help the

most vulnerable - that is, women and children to be self-reliant. So we ensure basic humanitarian services – health care, health education, vocational training and recreational activities become available to them. Recently, we have extended this beyond the Niger Delta area and have resettled a number of street children. How would you describe George Etomi? Hmm, what do I say- amiable, Godfearing and optimistic. What do you do to relax and unwind? Oh, I am a complete sportsman; from squash to tennis, to golf, there are no limits for me and I unwind by watching comedy programs because I like good humour. What’s next for George Etomi? Who knows, only God and I am available wherever He sends me.

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CRIMINAL LAW Dr. Esa Onojo and Dr. Nasiru Aliyu - Nigeria Law School

The Sentencing in Advance Fee Fraud cases in Nigeria A Critique

Dr. Esa Onoja – Lecturer, Nigerian Law School

Dr. Nasiru Aliyu – Lecturer, Nigerian Law School, Kano Campus, Kano

In its old and current forms, the Act contained stringent mandatory minimum punishment for different forms of advance fee fraud

Introduction: Nigeria and Nigerians are currently associated with advance fee fraud in most parts of the world. A Washington Post foreign correspondent, for instance, wrote thus: “Welcome to Nigeria, world capitol of business scam. Shake hands, but be sure to count your fingers.”1 Advance fee fraud has given Nigeria and Nigerians an image problem.2 Since 1995, successive Nigerian governments have been sufficiently alarmed by the association of Nigeria and Nigerians with such frauds at national and global fora to introduce special legislations against the malaise. The first enactment in this connection was the Advance Fee Fraud and Other Fraud Related Decree, 1995. This Decree was repealed and replaced. The current law is the Advance Fee Fraud and Other Related Offences Act 2006, (hereinafter called “the Act” or “Advance Fee Fraud Act”). In its old and current forms, the Act contained stringent mandatory minimum punishment for different forms of advance fee fraud. This article considers and comments on the practice of many High Court Judges, which manifestly do not follow the stricture by the Supreme Court3 that it is illegal for courts not to impose the minimum sentence for advance fee fraud prescribed by the legislature in the Act. Rather, sentences passed are disconnected both from the legislatively prescribed mandatory minimum sentences and the circumstances of the commission of some of these offences and concludes that courts are not the venue to effect a change in mandatory minimum sentences that individual judges perceive to be more

Law Digest Autumn 2014

proportionate to the circumstances of an offender. Sentencing under the Advance Fee Fraud and Other Fraud Related Offences Decree, 1995 [The Decree] The purpose of the Decree was to “encompass diverse aspects of the new wave of fraud, prescribe stiff penalties, take the sentencing regime partially out of the hands of the ordinary courts of the land, and relax rules of evidence and procedure”.4 Section 1(1) of the Decree, defined the offence of obtaining property by false pretences. The novelty of this provision is that it includes obtaining by false pretences from any person in Nigeria or in any other country, if any of part of the transaction forming the offence occurs, or is connected with Nigeria or cognisable in Nigeria. Unlike previous enactments on fraud in Nigeria, the Decree has extraterritorial application. It is not a defence to plead that the false pretence or inducement occurred outside Nigeria. It is also not a defence to argue that the transaction was a contract, if the contract was induced by false

Unlike previous enactments on fraud in Nigeria, the Act has extraterritorial application pretence. This provision is targeted at cases like Okunnu v. COP 5 and R. v. Osoba 6 where it was held that the courts in Nigeria have no jurisdiction if a document is wholly forged outside Nigeria. A false representation contained in a document forged outside Nigeria which induces a contract or delivery of property from Nigeria to another country, or vice vera, or where Nigeria is a transit for such delivery, can now be triable in Nigeria. Punishment for Advance Fee Fraud Under the Act The draftsman of the Act demonstrated a keen intention to deter advance fee fraud by prescribing stiff

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Consequently, any deviation from the statutorily prescribed range of punishment stipulated by the Act violates the letter and spirit of the Act punishment for violation of section 1 of the Advance Fee Fraud Decree, 1995. The punishment for the offence of advance fee fraud under section 1 of the Decree was imprisonment for a term of not less than 10 years and not more than 20 years without option of fine. There were many convictions under this section of the Decree. In Ede v. FRN 7 the appellants posing as a person phoning from South Africa obtained ₦450,000.00 (US$2,790.00 approx.) from the victim under the guise that a worthless substance was precious stones. They were convicted and sentenced to 10 years imprisonment.8 The Act, just like the Decree recognised that frauds could be perpetrated using the medium of a contract or commercial transactions. Therefore, an accused person would still be guilty if the false representation that induces the delivery of property was contained in a contract. In Shadrack Uzoka v. The State 9 the appellant was convicted of, inter alia, collecting money under false pretence. His conviction and sentence to imprisonment for a term of 10 years under section 1(3) of the Decree was affirmed on the basis that the burden of proof for the offence is discharged if the prosecution proves that money was collected from any person in Nigeria or another country with the requisite state of mind, regardless of whether the inducement was made through a contract or not. In contrast with the provisions of the Decree, section 1(3) of the Act, reduced the minimum sentence for obtaining by false pretences or attempt to do so to a term of imprisonment of not less than seven years, without option of a fine. The subsection provides that a

person convicted under section 1 of the Act shall be liable to be sentenced to “imprisonment for a term of not more than 20 years and not less than seven years without the option of a fine.” Where the offence relates to false pretence to the effect that the convict can make or print currency, he shall upon conviction be sentenced to a term of imprisonment of not more than 15 years and not less than 5 years without option of a fine.10 If an occupier or person in the management of premises causes or knowingly permits his premises to be used for any purpose which constitutes an offence under the Act, he shall be liable upon conviction to be sentenced to a term of imprisonment for not more than 15 years but not less than 5 years without the option of a fine.11 In Stanley Odua (Alias Duru Idika) v. FRN 12 it was held that the occupier or person managing

a term of imprisonment of not more than 20 years but not less than 7 years without the option of a fine. Section 4 is targeted at the invitation particularly of foreigners so that they could be duped as part of the ruse or fraudulent schemes. Section 7 of the Act addresses the laundering of the proceeds of advance fee fraud. Under section 7(2), where the convict is a financial institution or corporate body, it shall be liable to a fine of ₦1 million (US$6,200.00 approx.), while in the case of a director, secretary or other officer of the financial institution or corporate entity or any other person, to a term of imprisonment of not more than 10 years but not less than 5 years. This provision does not however state that the term of imprisonment shall be without option of a fine. But in addition to the above sanction, the

Ibrahim Lamorde of EFCC meeting with stockbrokers to discuss money laudering issues in Nigeria

the premises need not himself be the person who personally dispatched any letter containing a false pretence. An occupier or person managing a premise includes a person living in a building or taking care or doing business in the building. Under section 4 of the Act, where a person by false pretences, or with intention to defraud any person, invites or induces that person or any person to visit Nigeria for the purposes connected with the commission of an offence under the Act, commits an offence and is liable on conviction to

financial institution shall be liable to refund the total amount of the sum involved in the offence and shall also pay ₦100,000 (US$620.00 approx) sanction to the appropriate financial regulatory authority.13 Also under the Act, any person who participates in any form in the commission of an offence as a conspirator, or aids, abets or incites, procures, or induces the commission of an offence under the Act, commits an offence, and is liable upon conviction to the same punishment as the principal offender.14 Thus, the

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punishment for conspiracy or attempt to obtain property by false pretences is the same as the substantive offence. In Nwankwo v. FRN 15 the appellants were arraigned on two counts of conspiracy to obtain money by false pretences from one Sister Mary Dominica of Immaculate Queen Centre, Spokane, U.S.A. They were convicted and sentenced to 10 years imprisonment on each count to run concurrently. They appealed the decision to the Court of Appeal. In affirming their conviction and sentence, the Court of Appeal held, inter alia, that it was not even necessary for the prosecution to state the exact amount of money attempted to be obtained by false pretences under section 8(b) of the Decree. The Supreme Court of Nigeria held in Mike Amadi v. FRN16 that the punishment prescribed by the Act as applied in Nwankwo’s case, is “an eye opener.”17 Consequently, any deviation from the statutorily prescribed range of punishment stipulated by the Act violates the letter and spirit of the Act. A sentence by a High Court in defiance of the decision of the Supreme Court also offends the doctrine of judicial precedent and would in per incuriam. In addition to the penalty of imprisonment or fine (the latter for corporate entities) prescribed by the Act, a High Court shall order any person convicted under the Act to make restitution to the victim of the crime.18 This ensures that the victim is not put to the expense of a civil action to recover property obtained under false pretences under the Act. The approach adopted by the Act is to fix the mandatory minimum punishment and a maximum for offences created by the Act. High Courts have discretion to impose any sentence within the range not exceeding the maximum and also not below the mandatory minimum sentences prescribed by the different sections of the Act. Commenting on the difference between a mandatory sentencing provision and a discretionary scheme of sentencing, the inimitable Hon. Justice Niki Tobi JCA (As He Then Was) stated in Afaha Okpon Isang v. The State19 that: It is a combined principle of criminology and penology that where a sentencing

language in a statute is specific and mandatory, a court of law has no discretionary power to exercise. It must give the specific and mandatory sentence provided in the statute. On the other hand, where a sentencing language is general without fixing a mandatory ceiling by way of a sentence, a court of law can exercise its discretionary power to pass a sentence which it thinks is commensurate to the factual situation of the case. The Supreme Court of Nigeria also recently enunciated the distinction between a mandatory sentence and a discretionary sentence in Joseph Amoshima v. The State20 as follows: It is settled law that where a statute prescribes a mandatory sentence in clear terms…the courts are without jurisdiction to impose anything less than the mandatory sentence as no discretion exists to be exercised in the matter. It is a duty imposed by law. The above situation is different from the one in which the statute provides for either a minimum sentence…or the maximum sentence to be imposed. In either case, the court is clothed with the discretion to either impose more than the minimum or less than the maximum sentence prescribed.21 As evident in the above dictum, courts lack jurisdiction to deviate from mandatory sentences prescribed in clear terms by statutes. The punishment provisions of the Act, are couched in such clear terms. There is therefore no legal justification for judicial deviation from the legislatively prescribed range of punishment in the Act. Recent Sentencing Pattern of High Courts in Advance Fee Fraud Cases in Nigeria One would have expected that when the legislature expressly provides in a statute that an offender shall be sentenced to a term of imprisonment without option of fine that the courts would apply the provision, but this appears not to be the case in recent sentencing decisions from High Courts across the country. There is clear evidence of deviation from the statutorily prescribed range of punishment endorsed by the Supreme Court of Nigeria in Mike Amadi v.

FRN 22 and the Court of Appeal in Nwankwo v. The State 23, by High Court Judges across the country. A sample of recent unreported decisions from High Courts in various parts of the country supports this assertion. In FRN v, Briggs A. Nwokolo 24 the accused person was convicted on two counts of conspiracy and attempt to obtain property by false pretences. He was sentenced to a total of 18 months in prison. Also, in FRN v. Gabriel Oguniyi25 the convict was convicted on 8 counts of conspiracy to obtain by false pretences, and obtaining ₦288,000.00 (US$1,785.60 approx) and €100,000 Euros by false pretences. He was sentenced to 5 years imprisonment on each of 4 counts and 10 years imprisonment for 3 counts of obtaining by false pretences. He was further ordered to make restitution of the money obtained to the victim. In FRN v. Rufai Lukman26 the convict was sentenced to 6 months imprisonment on each of 22 counts of conspiracy and obtaining by false pretences, to run concurrently. The convict in FRN v. Gerald Emeka Obielom 27 received a sentence of 2 years imprisonment each on 11 counts of obtaining by false pretences and forgery. But Oyewole, J. was true to the letter and spirit of the law in FRN v. Pastor Ayodele & Others 28 when he sentenced the convicts to a total of 28 years imprisonment on 4 counts of conspiracy and obtaining by false pretences. In FRN v. Danlami Mohammed29 the amount obtained under false pretences was ₦3,500,000.00. (US$21,700 approx) The convict was sentenced to 1 year imprisonment on 4 counts of advance fee fraud. But in FRN v. Jacob Chinenwe Isintume30 (Alias Prince William Mbeki) the convict was sentenced to 7 years imprisonment on 2 counts of possession of documents containing false pretences. In FRN v. Samuel Oyewole31 the convict received 10 years, 7 years and 2 years imprisonment, respectively on several counts of conspiracy and advance fee fraud. Readers would observe that it is only in a few of the above cases that some of the Judges appear to have followed the provisions of the Act in sentencing convicts. The other judges imposed

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sentences below the mandatory minimum sentences prescribed by the Act. This offends the letter and spirit of the Act. It is also difficult to appreciate why the guide as to the construction of the punishment provisions in the Act provided first by the court of Appeal in Nwankwo’s case and later by the Supreme Court of Nigeria in Mike Amadi’s case were ignored. Courts must remind themselves that “… judicial discretion must be exercised honestly and in the spirit of the law or statute otherwise the exercise of such judicial discretion cannot be said to fall within the ambit of the law or statute.”32 It is submitted that the most rational method to appreciate the spirit of the Act is to refer to the genesis and the special character of the Act. It is a statute that arose from the exponential increase in the victimisation of Nigerians and foreigners by syndicates of advance fee fraudsters. There is little evidence to suggest that the level and frequency of these crimes have abated. The image of the country and her citizens remains in tatters abroad. By prescribing stringent punishment for advance fee fraud the legislature has clearly expressed a retributive and deterrence spirit. It is a disingenuous exercise of judicial discretion to depart from the spirit expressed by the legislature under the guise of reforming an offender because courts are not the venue to amend laws, not even if individual judges feel that it is unwise to fix an artificially high mandatory minimum punishment for a particular crime without regard to

the level of offending and the particular circumstances of the offender. Conclusion Where a statute prescribes a mandatory minimum sentence, “the mandatory minima simply represent an attempt by parliament to denounce and deter…”33 But “Mandatory minimum sentences are not a modern development”.34 Evidence of this is the mandatory sentence of death for murder or culpable homicide punishable with death in Nigeria. The Act has followed suit. It is instructive to note that Nigeria passed the Act partially as a result of international pressure triggered by the internationally acclaimed prowess of Nigerian fraudsters at victimising foreigners. Nigerian judges are selected, not elected, so they are not “publicly accountable”35 the way members of the legislature are, despite Nigeria’s flawed electoral process. The legislature is potentially better suited to attune to public sentiments and needs. Very few can deny that there is compelling need to check advance fee fraud in Nigeria. It is a negation of the fight against these crimes for courts to usurp the function of the National Assembly by routinely departing from the mandatory minimum sentences prescribed by the legislature. Apart from promoting inconsistency and unpredictability of sentences, it has the potential to further erode the already shaken public confidence in the dispensation of criminal justice in Nigeria. (Conversion rate at the date of print)

1 J.J. Hurley “The Resurgence of Nigerian Based Crime: A Growing Concern for U.S. Law Enforcement” available at www.shrewsburyma.gov/pdffiles/police/nigerian.pdf Accessed 2/2/ 2009. 2 See United States Department of State, Bureau of International Narcotics and Law Enforcement Affairs, Nigerian Advance Fee Fraud DEPARTMENT OF STATE PUBLICATION10465, Released April, 1997. 3 See Mike Amadi v. The State (2008) 12 S.C (Pt. 111) 55 4 Ibid, pp. 310-311 5 (1976) 1 FNLR 140 6 (1961) 1 ALL NLR 1 7 Supra 8 See also Ikpa v. The State (2008) ALL FWLR (pt. 446) 1959 9 (2010) 2 NWLR (Pt.1177) 118 10 See section 2 of the AFF Act 2006 11 See section 3 of the Act. 12 (2002) 5 NWLR (Pt. 761) 615 13 See section 7(3 of the 2006 Act. There are other sanctions for directors and other employees of financial institutions who facilitate advance fee fraud. 14 See section 8 of the 2006 Act. 15 (2003) 4 NWLR (Pt. 809) 1 16 (2008) 12 S.C (Pt. 111) 55 17 Per The Hon. Justice Aloma Mariam Muktar, JSC (As she then was) 18 See section 11 of the Act. 19 (1996) 9 NWLR (pt. 473) 458 at 473 para B-C 20 (2011) All FWLR (Pt. 597) 601 21 Per Ononghen JSC at pp 615-616, paras H-A 22 Supra 23 Supra 24 Unreported Suit No. ID/235C/2011 decided on 13th February, 2012 by Okunnu, J of the High Court of Lagos State. 25 Unreported Suit No.ID/93C/2005 decided on 14th March, 2012 by Obadinna, J. Lagos High Court 26 Unreported Suit No.ID/207C/2011 decided on 16/4/2012 by Abiri, J 27 Unreported Suit No.ID/116C/2011 decided by Onigbanjo, J 28 Unreported Suit No. ID/21C/2007 decided on 8/5/2012 29 Unreported Suit N.SS/1C/2012 decided on 12/3/2012 by High Court 4 Sokoto. 30 Unreported Suit No. FHC/PH/34C/2009 decided on 28/6/2012 by Akanbi, J 31 Unreported Suit No.K/EFCC/16/2010 decided on 20/6/2012 by the Kano State High Court, Kano 32 Per Onnonghen JSC in Joseph Amoshima v. The State, supra, at p.617 33 J.V. Roberts, “Mandatory Minimum Sentence of Imprisonment: Exploring the Consequences for the Sentencing Process” Osgoode Hall Law Journal Vol. 39, Nos. 2 & 3, (2001) pp. 305-329 at p. 315 34 Ibid 35 D. Roche, “Mandatory Sentencing” Trends and Issues in Crime and Criminal Justice, No.138, (December 1999) p.1 available at http://www.aic.gov.au. Accessed 8/3/2010 4:37 PM

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SPECIAL FEATURE Issues affecting the market for legal services Aside from the issue of restrictions on marketing, there are quite a number of other issues that have a bearing on the market for legal services in Uganda. They include but are not limited to the following: Capacity

Focus on Uganda INTRODUCTION Uganda is a common law county and its legal system is mirrored on the English Legal system. Practicing law in Uganda is conditional upon admission to the Bar, which only happens after a lawyer has successfully acquired a Diploma in Legal Practice awarded exclusively by the Law Development Center in Kampala. The effect of this is that practice in Uganda is severely limited to Ugandans. The advocates in Uganda subscribe to the Uganda Law Society, which is the main professional organisation aimed at maintaining and improving the standards of the legal profession and services offered.

Elias Bwanbale

The low capacity in Uganda has had an effect on not just access to legal services but also the quality of the service provided.

Structure of the legal services marker Uganda is a nation with a fast growing economy, a steadily expanding middle class, huge natural reserves and potential growth in the energy sector, especially - oil and gas. The demand for legal services in Uganda is in every bit on the rise. The buyers of legal services in Uganda are dominated by multinational companies such as Shell, Total, Airtel, Non-Governmental Organisations, Banks, and the likes. Remarkably, law firms in Uganda are forbidden from engaging in any acts which can be reasonably regarded as touting or advertising or calculated to attract business unfairly. This has limited the publicâ&#x20AC;&#x2122;s awareness of the availability of legal services and restricted legal service to urban areas. This has given an undue advantage to the larger firms with higher visibility.

Access to legal services in Uganda is extremely limited due to the low capacity. There are approximately 2000 practicing lawyers in Uganda, which has a population of 36.35 million people. This translates into one lawyer per 18,000 citizens, which is undoubtedly very low. By comparism, the US has 1,268,011 registered lawyers according to the American Bar Association, with a population of 313.9M; this is a ratio of 1 to 261. In England and Wales, the population of registered solicitors is 160,546 and that of barristers is 15,000, with a population of 55M, this is a ratio of 1 to 313, which represents the average across many European jurisdictions. In Africa, whilst the ratio is less, many most other jurisdictions still perform better than Uganda. It is estimated that there are 2,500 lawyers in good standing in Ghana, with a population of 26M; this is a ratio of 1 to 9600. Kenya has 7044 active lawyers, according to the Law Society of Kenya, with a population of 41M; this is a ratio of 1 to 5820. The low capacity in Uganda has had an effect on not just access to legal services but also the quality of the service provided. In addition to that, most lawyers concentrate their practice in urban areas leaving very few or no lawyers in some rural areas. This has further presented problems with access to legal services in Ugandaâ&#x20AC;&#x2122;s rural areas. This coupled with the restriction on marketing, means that many in the rural areas are less educated about their legal rights, how or where to access legal services. Access to legal information There is a challenge with access to the right kind of legal information for advocates, especially those in rural areas. Access to research facilities (online or otherwise) is limited and the cost can be prohibitive. Cost Cost of legal services can be prohibitive for most Ugandans. It is not usual for lawyers to accept instructions

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where payments are contingent upon completion of the matter. Due to the delay in the judicial process, some cases take years to conclude which makes these kinds of instructions unattractive to most lawyers. Consequently, many indigent litigants are not able to access legal services.

local and international transactions and have quite often engaged associate international law firms or alliances which whom they work on international transactions.

Practice Areas Most law firms in Uganda offer a wide range of private client services including; criminal law, debt recovery, employee benefits, employment & labour law, family law, customary law, constitutional law, probate, land law, and contract law, with L-R John Katende and Professor F. E. Ssempebwa

Uganda is a nation with a fast growing economy, a steadily expanding middle class, huge natural reserves and potential growth in the energy sector, especially - oil and gas, the demand for legal services in Uganda is in every bit on the rise a select few venturing into the realms of corporate and commercial practice such as insurance, intellectual property rights, aviation law, banking & finance, bankruptcy & liquidation, corporate restructuring, international business & investment law, media & entertainment, and mergers & acquisitions, areas which are now receiving significant attention include, oil & gas law, receivership, securities & capital markets, and telecommunication. The major firms The International Financial Law Review (IFLR) released its latest rankings [IFLR100 2014] in which Uganda’s tier 1 firms were reduced from five to four. They include; Katende Ssempebwa & co advocates, Sebalu Lule & co advocates, AF Mpanga and MMAKS. These firms are undoubtedly the largest firm in Uganda’s Legal services market especially in the areas of capital markets, project finance, banking & finance, oil & gas and mergers & acquisition. These firms have advised on both

Katende Ssempebwa & Co Advocates Senior Partners: John W. Katende, Professor Fredrick E. Ssempebwa (SC). Partners: Samuel S. Sserwanga, Soogi K. Katende, Fredrick K. Sentomero and Sim K. Katende. Associates: Jane Akiteng, Fred Kiiza Businge, Nsubuga E. Ssempebwa, Arthur K. Ssempebwa, David Mulumba, Alice Namuli, Arthur M. Katende, Daphine S. Byonabye, John Bosco Mudde, Judith N. Tumusiime, Yusuf B. Kanyike, Hasfa Namulindwa, Jovani I. Mugga, Frank J. Ssewagudde, Baati Katende and Sophia Nampijja. International Deals: The advised Walmart on its acquisition of Massmart in a US$ 4.2 billion transaction and IBM on its multi-billion dollar IT outsourcing agreement with Bharti Airtel. The firm advised Google and Accenture on their local operations in Uganda and McLaughlin Gormley King Corporation in its multi-million dollar acquisition of East African Botanicals Limited, among others. The firm works with associate firms in the UK such as Simons Muirhead and Burton Solicitors and Doughty Street Chambers on international transactions. Sebalu Lule & Co, Advocates Partners: Barnabas R. Tumusingize, James Mukasa Sebugenyi, Joseph Luswata, Nicholas Ecimu, Moses Segawa. Associates: Gertrude W Karugaba, Andrew W Munanura, Patson Arinaitwe, Alice Nalwoga, Micheal Mafabi, Allan Waniala, Paul Mbuga, Lindah S. Ddamba, Sara

Access to legal services in Uganda is extremely limited due to the low capacity. There are approximately 2000 practicing lawyers in Uganda which has a population of 36.35 million people. Nakiwolo, Sheillagh W. Kirunda, Daniel Kasuti, Victoria Nakaddu, Winnie Awino, Winnie Kyomuhendo and Prossie Nambatya. International Deals: This firm acted as legal transaction advisor in association with DLA Piper New York, to the Privatisation and Utility Sector Reform Project (PUSRP) of the government of Uganda for the concession of assets of Kilembe mines, Uganda’s sole copper mine, acted for Nigerian financial Bank PHB PLC (now succeeded by Keystone Bank Ltd Nigeria) in conducting an employment and pensions due diligence for Keystone Bank’s US$64 million acquisition of a majority equity stake in a domestic financial institution and advised Rabobank and its subsidiary Rabo Development on the acquisition of a 27.5% stake in Development Finance Company of Uganda. The firm acted for South Africa’s largest private equity firm in conducting a legal due diligence on a US$ 250million railway concessionaire investment target, acted for South Africa’s leading tourism company in its acquisition of a 60% stake in Uganda’s leading white water rafting company and further acted for NORFUND in its acquisition of an additional 17.4% equity stake in DFCU Ltd, a company on the Uganda Securities Exchange. This firm has an alliance with DLA Piper. Shonubi Musoke & Co Advocates Partners: Alan C. Shonubi, Innocent Kihika, Ezekiel Tuma, Noah E. Mwesigwa and Andrew Kibaga. Associates: Allan Kukuwa, Andrew Bwengye, Doreen Nanvule, Jamina Apio, Janet Ayesigwa, Naomi Byabazaire, Sam Gimanya, Byrd Ssebuliba, Elizabeth Rukundo, Moses g. Byaruhanga, Brian Alade Shonubi, Brigette K. Byarugaba and Nicholas Mwasame.

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Remarkably, law firms in Uganda are forbidden from engaging in any acts or things which can be reasonably regarded as touting or advertising or as calculated to attract business unfairly. Junior associates: Hellen Nakiryowa, Martha Apoo, Paul Kaweesi and Rebecca Nakiranda Consultants: Tajdin Mitha and Justice David C. Porter International Deals: The firm advised Hits Telecom and all its local and foreign shareholders in the sale of a $179 million stake to France Telecom and Atlas Services of Belgium and advised Orient Bank on U$D 64 million sale of 80% stake to Bank PHB of Nigeria. This firm’s affiliates include Africa Legal – a specialised division of Denoys Reitz Inc., one of South Africa’s largest and most reputable law firms.

David Mpanga of AF Mpanga Advocates

AF Mpanga Advocates Partners: William Kasozi, Mpanga David F.K, Mpanga Fredrick, Julius Musoke and Wiltshire Ernest. International Deals: The firm advised CNOOC on the farmin of one third of Tullow Oil’s interest in three oil exploration blocks in western Uganda for a total deal size of US$1 billion. It acted as local counsel for Helios Investors Genpar II LP and Vistol SA on the acquisition of Royal Dutch Shell Plc’s assets in Uganda as part of an Africa-wide transaction valued at US$ 1 billion and also acted as local legal counsel for Oryx Oil and Gas SA which was a shortlisted bidder for the acquisition of the retail petroleum outlets of Chevron in South Africa. The firm further advised the shareholders of

Commercial Microfinance Limited in the acquisition of 100% of the shareholding in that financial institution by Nigerian Global Trust Bank Limited. The firm is a member of the BGBowman Gilfillan Africa Group, one of the big five law firms in South Africa based in Sandton, Johannesburg. MMAKS Advocates Partners: Timothy K Masembe, Apollo N. Makubuya, Moses J. Adriko, Phillip Karugaba, Mathias V. Ssekatawa, Racheal M. Musoke, Ernest S. Kaggwa and Isaac Walukagga. Associates: Fiona N. Magona, Stephen Zimulu, Sheila Ann Pacuto, James B. Kwera, Lydia N. Laryima, Mark Turyamureba, Grace Nakabugo, David S. Mukibi, Funso Tinuoge and Rehema Nakiga. International Deal: The firm acted with Slaughter & May, for Reliance Industries Limited in connection with its acquisitions of a majority stake and management control in Gulf Africa Petroleum Corporation (GAPCO), a company with significant presence in Eastern Africa in the downstream petroleum sector, including coordination of a five country (Kenya, Uganda, Tanzania, Rwanda and Sudan) due diligence. The firm is a member of the Africa Legal Network (ALN), an independent alliance of leading Law firms in Africa. The rising stars. In our opinion, mention must be made of the following firms, which we consider the rising stars in the legal services market, particularly in the fields of capital markets, project finance, banking & finance, oil & gas and mergers & acquisition; Kasirye Byaruhanga & Co, Advocates Founded in 1991, it handles a range of corporate and commercial work and also has a significant litigation practice. The firm covers all areas of commercial law from corporate and commercial investments, privatisation, finance and banking, telecommunication, intellectual property, arbitration and litigation. International law firms regularly engage the firm to act as local counsel when they require Ugandan expertise. The key contacts are the managing partners Andrew Kasirye and William Byaruhanga. Kampala Associated Advocates (“KAA”). KAA is acknowledged as one of the leading firms in the areas of corporate

and commercial work, dispute resolution, banking and tax but is now developing significant capacity in the areas of capital markets, project finance, banking & finance, oil & gas and mergers & acquisition. The firm features lawyers such as Peter Kabastsi, Oscar Kambona, Joseph Matsiko and David Mpanga. It is also a “Partner Firm” with TRACE international, Inc., a non-profit, USbased membership association, which provides major US corporations with legal advisory services on foreign antibribery measures and compliance solutions in order to uphold their compliance with the US Foreign Corrupt Practices Act 1977. KAA has concluded special associate agreements with South Sudan Associated Advocates, based in Juba, Southern Sudan, and with Trust Law Chambers, based in Kigali, Rwanda to provide services across the three jurisdictions. Within the Dentons framework, KAA also closely collaborates with the Nairobi-based firm of Hamilton Harrison & Mathews and the Dar es Salaam based Mkono & Co Advocates. These relationships have given KAA a strong geographical reach within the Eastern Africa Region. This firm is steadily making its way to the top. Ligomarc Advocates Ligomarc Advocates has over ten years of practice in financial law and an in-depth understanding of Uganda’s financial industry. This firm is the recognised leader in financial services. The firm has also being developing expertise in energy and insolvency practice among others. Byenkya Kihika & Co Advocates This is a corporate and commercial firm whose work includes transactional, regulatory and restructuring advice. The Senior Partner, Ebert Byenkya’s practice is primarily focused on litigation but he also handles complex corporate finance, energy and telecommunications work.

William Were of Capital Law Partners

Capital Law Partners & Advocates Established in 1990, Capital Law Partners provide a specialised legal and support services in the area of M&A, divestitures, oil and gas, Banking and Project financing.

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UBCEES: University of Buckingham Centre for Extractive Energy Studies

Current Legal and Policy Issues in the African Energy Sector 29 October 2014 14.00-17.00 Radcliffe Centre University of Buckingham MK18 1EG

Join the University of Buckingham Centre for Extractive Energy Studies (UBCEES) for a Round Table Conference featuring noted experts who will discuss contemporary legal and policy issues in the African energy sector The University of Buckinghamâ&#x20AC;&#x2122;s Centre for Extractive Energy Studies offers a uniquely holistic approach to the study of extractive energy. This ranges from issues of good governance and accountability, combating corruption and asset recovery, on to the legal, fiscal and competition issues relating to the actual process of the extraction and carriage of energy resources and its environmental and social impacts. It also explores community and labour rights in the global extractive energy sector, including indigenous community participation in the decision making process of the ownership, extraction and sustainable management of energy resources. Conference contacts: Professor John Hatchard, Co-Director UBCEES john.hatchard@buckingham.ac.uk

Mrs Hephzibah Egede, Co-Director UBCEES hephzibah.egede@buckingham.ac.uk

Alun Jones, QC

Andrew Legg

Kemi Pinheiro, SAN

Prof. Koyinsola Ajayi, SAN

Abimbola Izu

Mangeat Gregoire

Segun Osuntokun

Dr. Stuart Dutson

Anthony Idigbe, SAN

Yele Delano, SAN

A unique opportunity to hear leading local and international lawyers, forensic accountants, fraud and regulatory experts from the US, UK, Nigeria as well as key offshore jurisdictions to discuss trends and development in economic and financial crime litigation and asset recovery. Expert led sessions will include: Role of forensic accounting in fraud trial and asset tracing. Overlap between EFCC investigation and civil litigation – Role of the defence team. Strategies for challenging preliminary freezing, production and forfeiture orders. Forgery and identify theft – liabilities of financial institutions. Challenging the appointment of Receivers/Administrators. Case Study – Asset Tracing and Recovery - Switzerland, UK and US The Forum also offers unparalleled opportunity to network with lawyers, litigation, fraud specialists, forensic accountants and recovery experts from around the world.

Registration Fee: ₦35.000 per delegate Venue: LAGOS, NIGERIA Date: 4th NOVEMBER 2014 HOSTED BY:

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