Nigeria Air: Court blocks FG-Ethiopian national carrier deal

The Federal High Court sitting in Lagos has granted an order of interim injunction restraining Nigeria Air Limited, Ethiopian Airlines, the Minister of Aviation, Hadi Sirika and the Attorney General of the Federation, Abubakar Malami (all of whom are listed as defendants) from executing the proposed or draft “NATIONAL CARRIER ESTABLISHMENT AND AGREEMENT BETWEEN THE FEDERAL GOVERNMENT OF NIGERIA and the strategic equity partner, Ethiopian Airlines.

Justice Ambrose Lewis -Allagoa granted the order while ruling on a exparte application brought by the Registered Trustees Of The Airline Operators Of Nigeria, Azman Air Services Ltd, Air Peace Nigeria Ltd, Max Air Ltd, United Nigeria Airlines Company Ltd and TopBrass Aviation Ltd all of whom are listed as plaintiffs in a suit they filed against the defendants.

The order, which was granted on Tuesday, restrained the defendants as represented by the Minister of Aviation and the AGF and the strategic equity partner, as represented by Ethiopian Airlines from giving effect to and or suspending the sale and transfer of the shared and operations of Nigeria Airlines and Ethiopian Airlines pending pending the determination of the motion on notice

The court also asked all parties to maintain status quo and refrain from taking further steps in the suit pending the determination of the motion on notice.

Justice Lewis-Allagoa granted an accelerated hearing of the suit brought by the plaintiffs against the defendants

In the motion on notice, the plaintiffs are seeking among other things a DECLARATION that the action, conduct and or decisions in the sale of the shares and operations of Nigeria Air
Ltd is in violation of the Companies and Allied Matters Act (CAMA) 2020, and other regulatory statutes on aviation, companies and investment laws in Nigeria.

They are also seeking a declaration that Ethiopian Airlines is incompetent to bid for shares in Nigeria Air Ltd and to commence business accordingly.

They asked the court to set aside the entire bidding/selection process for the “Nigeria Air” project md an order directing an immediate, fresh and transparent bidding process(es) involving the Plaintiffs being the indigenous Airline Operators in Nigeria rightly entitled to participate in the process.

They are also seeking to be paid Two Billion Naira, only as damages for the injury they claimed to have suffered as a result of their wrongful exclusion and what they called the unlawful bidding and selection processes for the Nigeria Air project.

In the originating summons of the matter which borders on the construction and interpretation of the infrastructure Concession Regulatory Commission Establishment Act of 2005, the National Policy on Public Procurement Act, Federal Competition and Consumer Protection Act and the Sole Bidding and Selection of Ethiopian Airlines by the Federal Republic of Nigeria, the plaintiffs had asked the defendants to enter appearance within 30days to enable the court determine the following questions:

1. WHETHER on proper construction 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; the action, conduct and or decisions in the sale of the shares and operations of the 1st Defendant is not invalid, null & void.
2. WHETHER on construction of International Civil Aviation Organization (ICAO) Convention, amongst others, 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 not invalid, void and of no effect having regard to the process embarked upon and the extant local and international laws and regulations on aviation including the terms and condition stated in the request for Proposal.
3. WHETHER on construction of International Civil Aviation Organization (ICAO) Convention, amongst others, 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 not invalid, void and of no effect having regard to the process embarked upon and the extant local and international laws and regulations on aviation including the terms and condition stated in the request for Proposal.
4. WHETHER, on a construction of section 78 (1) & (2) of the Companies and Allied Matters Act (CAMA) 2020, Rule 406(2) of SEC Nigeria Consolidated Rules & Regulations 2013 (as amended in 2022), section 20 of the Nigerian Investment Promotion Commission (NIPC) Act, Article 7 of the International Civil Aviation Organization (ICAO) Convention, section 33 of the Civil Aviation Act Cap C13 LFN 2004 (as amended in 2006); the 2nd Defendant and its consortium were competent and qualified to bid for shares in the 1st Defendant and commence business accordingly.
5. WHETHER, on a construction of Sections 4 & 5, among others, of the Infrastructure Concession Regulatory Commission (Est.) Act, 2005; Sections 24 & 27, among others, of the Public Procurement Act; and Clauses 2, 3 and 4 of the Procurement Processes for Public Private Partnership in the Federal Government under the National Policy on Public Private Partnership (N4P), sections 76-81 of the Federal Competition and Consumer Protection Act; the selection of the 2nd Defendant and its consortium as the sole bidder in the bidding exercise for the Nigeria Air Project conducted by the 1st, 3rd & 4th Defendants is proper, lawful and valid?
6. WHETHER the entire process for the sale and transfer of shares of the in the 1st Defendant to the 2nd defendant and its consortium by the 3rd and 4th Defendants is in line with the provisions of the Infrastructure Concession Regulatory Commission (Est.) Act, 2005, Federal Competition and Consumer Protection Act, International Civil Aviation Organization (ICAO) Convention, the National Policy on Public Private Partnership (N4P), sections 76-81 of the Federal Competition and Consumer Protection Act and does not affect the entire process including the selection, approval or grant to the 2nd Defendant and its consortium by the 3rd and 4th Defendants is not invalid and thereby entitling the entire process to fresh bidding exercise?

Upon the determination of the questions, the Plaintiffs want the court to grant these claims against the Defendants:

1. 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.
2. 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.

1. 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.
2. 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.
3. 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.

vii. 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.

viii. PERPETUAL INJUNCTION restraining the defendants, their agents, servants, officers, privies, and principals from perfecting, continuing and transferring the operations of Nigeria Air by the 3rd and 4th Defendants to the 2nd Defendant. – Channels.