The Federal High Court sitting in Lagos has declared null and void the sale of Nigerian Air Ltd to Ethiopian Airlines
Justice Ambrose Lewis-Allagoa in his judgment stopping the sale ordered that the proposed establishment of a national carrier-Nigeria Air, by the Federal Government, should not be carried out.
The judge made the order while granting the reliefs sought by the plaintiffs, the Registered Trustees of the Airline Operators of Nigeria, and five others in the aviation industry.
Justice Lewis-Allagoa held that all the reliefs sought are granted except for the relief asking for N2bn as damages for the injury suffered by the plaintiffs as a result of their wrongful exclusion and the wrongful action; unlawful bidding and selection processes for the Nigeria Air project.
Listed as the 1st to 6th plaintiffs in the suit are the Registered Trustees of the Airline Operators, Azman Air Services Limited, Air Peace Limited, Max Air Limited, United Nigeria Airlines Company Limited, and Topbrass Aviation Limited.
The six plaintiffs had filed the suit against the first to fourth defendants; Nigeria Air Limited, Ethiopian Airlines, Senator Hadi Sirika (former Minister of Aviation, Federal Ministry of Aviation), and the Attorney-General of the Federation.
In the suit, the plaintiffs had asked the court to make an order setting aside the entire bidding/selection process(es) for the “Nigeria Air” project as well as the approval, grant, or selection of Ethiopian Airlines by the Former Minister, Hadi Sirika and then Former Attorney General of the Federation, Abubakar Malami.
In the Originating Summons filed in Nov. 2022, the plaintiffs “challenged the sale and transfer of shares of Nigeria Air”. They also claimed that the bidding process for Nigeria Air, facilitated by the Federal Government of Nigeria, was fraught with irregularities and favoured Ethiopian Airlines, a foreign entity wholly owned by the Ethiopian Government.
The plaintiffs argued that the representatives of the Federal Ministry of Transportation who hold significant control in Nigeria Air failed to comply with the request for proposal guidelines, leading to the exclusion of local airlines from the bidding process.
The plaintiffs also said that the 3rd and 4th defendants, who are key government officials, facilitated a skewed bidding process, granting the 2nd defendant, Ethiopian Airlines, and its consortium unprecedented privileges.
These include a 15-year tax moratorium, exclusive terminal buildings in Lagos and Abuja, and significant financial support, which they argue will undermine local airlines and the Nigerian economy.
According to the plaintiffs, the consortium led by Ethiopian Airlines was discreetly allowed to be the sole bidder and winner, contrary to the principles of free and fair competition.
The 2nd defendant’s business plan also proposed strategies that could stultify the operations of local airlines, further jeopardising the Nigerian aviation industry.
Additionally, the plaintiffs disclosed that the transaction advisor for the deal was inadequately qualified and lacked the necessary experience, raising further concerns about the legitimacy of the bidding process.
The plaintiffs asserted that the entire process was marred by politics and personal interests, designed to achieve an outcome detrimental to Nigerian airlines and the broader public interest.
They sought an order to nullify the entire bidding and selection process for the Nigeria Air project as well as the approval and selection of Ethiopian Airlines by the defendants.
In the judgement, delivered on Monday, Justice Lewis-Allagoa discountenanced the sole issue raised by the 2nd defendant (Ethiopian Airlines).
He held, “All the reliefs sought by the plaintiffs are granted except for relief number eight.
The reliefs include:
A DECLARATION that the action, conduct, and or decisions in the sale of the shares and operations of the 1st Defendant is in violation of the Companies and Allied Matters Act (CAMA) 2020, SEC Nigeria Consolidated Rules & Regulations 2013 (as amended in 2022), Nigerian Investment Promotion Commission (NIPC) Act, International Civil Aviation Organization (ICAO) Convention, Civil Aviation Act, Public Procurement Act, Concession Regulatory Commission (Est.) Act, 2005, Federal Competition and Consumer Protection Act, Procurement Processes for Public Private Partnership in the Federal Government under the National Policy on Public Private Partnership (N4P) and Nigeria Civil Aviation Regulations, 2015, and other regulatory statutes on aviation, companies, and investment laws in Nigeria.
ii. A DECLARATION that the entire administrative actions and decisions of the 3rd and 4th Defendants in the sale of the shares of the 1st Defendant to the 2nd Defendant and its consortium is invalid, void, and of no effect.
iii. A DECLARATION that the 2nd Defendant was incompetent to bid for shares in the 1st Defendant and commence business accordingly.
iv. AN ORDER setting aside the entire bidding/selection process(es) for the “Nigeria Air” project as well as the approval, grant, or selection of the 2nd defendant by the 1st, 3rd, and 4th Defendants in the process.
v. AN ORDER directing the immediate, fresh, and transparent bidding process(es) involving the Plaintiffs being the Indigenous Airline Operators in Nigeria rightly entitled to participate in the process.
vi. AN ORDER directing the immediate revocation and cancellation of the Air Transport License (ATL) issued by the Nigerian Civil Aviation Authority (NCAA) to the 1st Defendant.
Relief eight which failed was for “AN ORDER OF N2,000,000,000.00 (Two Billion Naira, only) as damages for the injury suffered by the Plaintiffs and still suffering as a result of the wrongful exclusion of the Plaintiffs, wrongful action; unlawful bidding and selection processes and their wrongful projection of the Plaintiffs as not having properly, rightly and timely bid for the Nigeria Air project”.
