It is clear that the complications connected with the rehabilitation of the Lagos-Ibadan Expressway are crying for clarification. Ultimately, clearing up the issues that make the project unclear cannot be divorced from the rule of law. A violation of the rule of law facilitated failure in the first place; and attention to the rule of law is critical to the success of the rehabilitation project.
Arbitrariness was responsible for the initial complication. It all began with the Goodluck Jonathan administration’s 2012 termination of a concession agreement with Bi-Courtney Highways Services Limited (BCHSL), which was supposed to reconstruct and manage the toll road. The past government alleged that the company failed to make progress on actualising the objective of the concession four years after the agreement signed with a preceding administration.
It is over two years since the Jonathan administration in July 2013 rearranged the reconstruction, following a N167 billion contract, awarded to Julius Berger Nigeria Plc and Reynolds Construction Company Limited. Under the new arrangement, two sections of the expressway will be reconstructed: Section I (Lagos to Sagamu Interchange) and Section II (Sagamu Interchange to Ibadan).
According to Bi-Courtney, “We are in court because the alleged cancellation of the concession did not follow due process. Apart from that, the so-called contract involving the two new companies handling the project was awarded arbitrarily without a bidding process.” The company said: “BCHSL won the concession to reconstruct and manage the toll road for 25 years. It’s a Design, Build, Operate and Transfer (DBOT) arrangement. According to the concession agreement, the road will be expanded to 10 lanes from Lagos to Sagamu and six lanes from Sagamu to Ibadan. Because of this expansion, structures that fall within 60.35 metres from the median on both sides of the road will be demolished, and government will compensate owners of the affected properties.”
Like a winding way, the Lagos-Ibadan Expressway presents twists and turns. Another development further complicated the reconstruction of the expressway and reinforced the complications.
The confusion was compounded by comments credited to the Managing Director of the Infrastructure Bank Plc, Mr. Adekunle Oyinloye, in a newspaper report. Oyinloye was quoted as saying: ”Motorways Assets Limited (MAL) has been given consideration for the project. The Infrastructure Concession Regulatory Commission (ICRC) has to give the concession certificate, while the lenders and investors have to ensure that all the details are properly worked out. We have now got all the relevant approvals.”
Bi-Courtney’s response correctly raised questions related to the rule of law. In a statement, the company posed a fundamental question: “Were regulatory procedures complied with by Infrastructure Bank?” The company continued: “They were not. The most fundamental steps in the granting of a concession under the law are as follows – Advertise the concession in national newspapers; there must be competitive bid/tender process as prescribed by the Public Procurement Act (2007); the Infrastructure Concession Regulatory Commission (ICRC) ‘shall take custody of every Concession Agreement under this Act and monitor the compliance with the terms and conditions of such Agreement’; obtain the approval of the Federal Executive Council.”
Conclusively, Bi-Courtney said: “Infrastructure Bank Plc did not comply with any of these steps.” It further said that ICRC officially “denied the existence of such a Concession.” The company added: “If the institution responsible for taking custody of the Concession Agreement and monitoring its compliance with the laws of Nigeria is not aware of the Concession, where then was the Concession created under the Law?”
It is worth mentioning that in its response to the allegation of non-performance, Bi-Courtney blamed work delay on the Jonathan administration. It argued that in the period of three years and six months that the company had the concession, it was slowed down for two years and 10 months. According to the company, the design process which was expected to be completed within four months took 18 months as a result of bureaucratic bottlenecks at the Ministry of Works. Interestingly, the ICRC corroborated Bi-Courtney’s position.
It would appear that the announced cancellation of the concession by the Ministry of Works on November 19, 2012, was the culmination of a chain of unprogressive behind-the-scenes manoeuvres by powerful people in the government of the day.
Evidently, the Jonathan government’s arbitrary move was in conflict with the rule of law, and there is evidence to show that Bi-Courtney demonstrated more respect for the law. According to a recent report, Bi-Courtney, in January 2013, proposed arbitration to the then Minister of Works, Mr. Mike Onolememen.
The company said in a letter to the minister: ”… the ministry’s purported notice of the non-compliance with the Agreement is premature and invalid.” Also, it emphasised “the need for the Grantor to comply with the Agreement before it alleges non-compliance by another party”. Bi-Courtney declared: “We believe that a dispute has arisen which should have been resolved in accordance with the dispute resolution mechanism under Article 21 of the Agreement prior to the invocation of any termination clause. In the circumstance, we demand that the Dispute Resolution Board (“the board”) be set up, to determine the propriety or otherwise of your action under the Agreement.” Bi-Courtney listed its nominees to the Board.
The company added: “Kindly appoint your nominees to the Board within 14 daysof your receipt of this letter. As you are aware, this should have been done earlier in the transaction.
For the avoidance of doubt, we reiterate that your purported termination of the Concession is, according to law, invalid and should be discountenanced by relevant parties.” The report said: “But three years after, the Federal Government is yet to take action on the matter.”
At the heart of the matter is the pivotal phrase “according to law”, which highlights the centrality of the rule of law. The simple point is that there can’t be rule of law without respect for the law; and there can’t be respect for the law without the rule of law.
It is reassuring that the Minister of Power, Works and Housing, Mr. Babatunde Fashola (SAN), recently expressed the Federal Government’s concern concerning the lingering litigation on the Lagos-Ibadan Expressway. Fashola was quoted as saying: “The Lagos-Ibadan Expressway is a story of what investors don’t like. The FGN granted a concession to a private company (Company A) and later withdrew and cancelled it. The FGN then entered into a construction and financing agreement with another company (Company B). Company A went to court and got an order to cancel the financing agreement with Company B.”
”As things stand,” he continued, “work has been stopped on the construction of the road…Regrettably, while not going into the merits and demerits of the FGN’s cancellation of Company A’s “concession”, it sends a not-welcoming message to foreign investors if the decision was without basis or influenced by politics…”
When all is said and done, the rule of law is the problem and the rule of law is the solution.
NATION
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