Incorporating ADR Practice in Northern Nigeria for Business Growth and Stability

Joseph Mtemdoo Gbagyo, ACIArb (UK) | Augusta Aondoaver Shahin, MCIArb (UK) | Chizoba Green Oge-ali, Esq.

 

Alternative Dispute Resolution (ADR) plays a critical role in emerging business environments, particularly in parts of Northern Nigeria where sectors such as manufacturing, energy, mining, and food processing are rapidly expanding while institutions are still evolving. With this growth comes an increase in conflict, especially commercial disputes. Given the existing gaps in justice administration, ADR becomes essential for safeguarding business interests and preserving relationships.

On 26 May 2023, former President Muhammadu Buhari signed into law the Arbitration and Mediation Act, 2023 (AMA) replacing the Arbitration and Conciliation Act, Cap A18 (ACA), Laws of the Federation of Nigeria, 2004. The new AMA is widely regarded as one of the most progressive pieces of arbitration legislation in Africa, providing clear guidance for arbitration and mediation practices within and beyond Nigeria.

In line with global business best practice, the AMA has brought significant developments which encourages the use of arbitration and mediation for the settlement of disputes. As previously mentioned, ADR plays a crucial role in developing markets, particularly where institutions are still evolving. This raises a key question: Why should arbitration be considered as an alternative method of dispute resolution? The benefits are itemized as follows:

Cost-effectiveness and Efficiency

ADR including mediation, arbitration, conciliation, and negotiation offers expedient, less cumbersome, and cost-effective alternatives to litigation, which is critical in markets where businesses need speed and certainty. ADR provides an escape from protracted cases caused by infrastructural and budgetary inadequacies.

Building Investor Confidence

Outside of overburdened court systems, ADR ensures predictability and stability. Business owners, investors and even clients are more comfortable and relax putting resources into jurisdictions where disputes can be resolved equitably, efficiently,

Restoring and Preserving Business Relationships

In emerging markets, especially in the northern part of Nigeria where the sustainability of networks and partnerships is vital, ADR (particularly mediation and arbitration) helps parties resolve disputes while preserving relationships.

Cultural Sustainability and Adaptability

Communities where litigation may be seen as hostile, ADR often time is tailored to align with norms and values of local customs, traditions, and business practices that are not incompatible to extant laws, making it more acceptable in such jurisdictions.

Reducing overburdened Pressure on Courts

Courts in Nigeria are, as matter of fact overburdened, especially during election petition periods and with other civil suits. Many emerging economies especially in African jurisdictions face congested court systems. ADR provides an alternative that eases judicial backlog, fostering quicker dispute resolution.

Global Integration

As businesses in emerging markets expand globally, ADR provides internationally recognized mechanisms (especially arbitration) that support cross-border trade and investment

Cross-Border Trade, Investment Disputes, and International Diplomacy

Northern Nigeria is not only a domestic commercial hub but also a gateway for cross-border trade with Niger, Chad, and Cameroon. These cross-border dynamics generate unique disputes, ranging from contractual disagreements to investment-related conflicts. Traditional litigation is often unsuitable for such disputes, given differences in legal systems, enforcement challenges, and the need for speed. Here, international arbitration and mediation become essential tools.

The Arbitration and Mediation Act, 2023 strengthens Nigeria’s alignment with international instruments such as the UNCITRAL Model Law and the New York Convention on the Recognition and Enforcement of Arbitral Awards. This makes arbitral awards rendered in Nigeria more easily enforceable across borders, enhancing investor and trader confidence. For Northern Nigeria, where industries such as energy, mining, and agriculture are particularly reliant on foreign partnerships, this legal assurance is vital.

Furthermore, ADR contributes to commercial diplomacy. Disputes resolved amicably through arbitration or mediation help preserve Nigeria’s bilateral and multilateral relationships, especially under frameworks such as the African Continental Free Trade Area (AfCFTA) and the ECOWAS Trade Liberalisation Scheme. In this way, ADR is not just a legal mechanism but also a tool of diplomacy, economic stability, and regional cooperation.

By embedding ADR practices within its legal and commercial systems, Northern Nigeria can position itself as a credible venue for cross-border dispute resolution. This will not only boost investor confidence but also strengthen the region’s role in advancing Nigeria’s global reputation as a stable and reliable hub for trade and investment.

ADR Context for Northern Nigeria

As earlier stated in the introductory lines, Northern states have diverse populations, strong community and religious institutions, and vibrant commercial activities (agriculture, trade, mining, cross-border commerce). The court system often suffers from congestion or rather overburdened, delays, limited access, and high cost barriers.

Many disputes (commercial, family, land, communal, business partnerships) are better suited to consensual and culturally sensitive resolution methods. ADR in Northern Nigeria remains underdeveloped despite huge commercial activity compared to the South. It should therefore be deepened for the following reasons:

Promotes Access to Justice

Many rural and semi-urban communities struggle with access to regular courts be it superior or non superior courts. ADR, especially mediation and community conciliation offers a cheaper, faster, and more familiar road to justice. To strengthen confidence in the justice system, the executive and judiciary in Northern states should collaborate to establish and expand Multi-Door Courthouse systems, bringing ADR closer to the people. In the same vein, it will reduces Court Backlog in Nigerian courts, including in the North, face serious case congestion. Diverting commercial and civil disputes to ADR reduces the burden, leaving courts to focus on criminal and constitutional matters.

Promoting Gender Inclusion and Access to ADR for Women

In many parts of Northern Nigeria, women face distinct barriers to accessing formal justice systems. These barriers may include financial dependency, social restrictions, fear of reprisal, and lack of legal literacy. For these reasons, ADR, particularly mediation and community-based conciliation; offers a more approachable and familiar mechanism for dispute resolution, especially in matters involving family, land, inheritance, and micro-enterprise disputes.

To ensure that women benefit meaningfully from ADR mechanisms, there is a pressing need to recruit, train, and accredit female mediators and arbitrators, particularly from within local communities. Women are more likely to engage with ADR processes when they see themselves represented and when neutrals understand the social realities they face.

Equally important is the creation of safe and confidential spaces where women can participate in mediation processes without fear of intimidation or social backlash. This includes ensuring privacy during proceedings and adopting culturally sensitive approaches that respect women’s dignity and autonomy.

Religious and traditional leaders play a significant role in shaping community attitudes toward dispute resolution. As such, they should be encouraged to actively support women’s access to ADR forums. Their endorsement can lend legitimacy to female participation and help break down barriers rooted in custom or perception.

Finally, it is crucial to mainstream gender sensitivity training for all ADR professionals. This will help ensure that mediators and arbitrators are equipped to handle disputes involving women with fairness, empathy, and cultural awareness, ultimately fostering a more inclusive and effective ADR system.

ADR’s non-adversarial nature makes it more compatible with women’s preferences in resolving disputes, especially in patriarchal settings. Gender-inclusive ADR frameworks will not only promote equitable justice but also enhance legitimacy and community trust in dispute resolution systems.

Respects Cultural and Religious Norms

Tribes in Northern Nigeria, such as the Hausa, Tiv, Fulani, Kanuri, Nupe, Gbagyi, Tarok, Ebira, Igala, Birom, Jukun, and Angas, have long traditions of consensus-building and reconciliation (e.g community elders’ mediation) where the power of dispute resolution resides in the community elders of the village. Similarly, ADR can harmonize with Sharia courts and customary institutions, giving parties solutions they see as legitimate and fair.

Promotes Commerce and Investment

Northern Nigeria is a hub for trade (e.g. Kano, Kaduna, Sokoto, Maiduguri are major market cities). Investors and businesses want quick, confidential, and enforceable dispute resolution. Strengthening strong ADR practice (arbitration centres, mediation schemes) in these regions will make business more attractive for local and foreign investment.

Conflict Prevention, Peacebuilding and Employment Opportunities

The North faces challenges with communal disputes, herder–farmer conflicts, terrorism and insurgency aftermaths. ADR mechanisms such as mediation can provide platforms for dialogue, reconciliation, and conflict management outside of violent confrontation. Well supported mediation centres will provide support for local mediators and community elders. Governments in these regions must support formal ADR through policies and legal frameworks capable of managing these disputes constructively. In the same vein, strengthening ADR practice will create a professional field for lawyers, mediators, and arbitrators in the region. Capacity building in ADR can empower graduates, NGOs, and community leaders.

Youth Empowerment Through ADR Capacity Building

Northern Nigeria has a youthful population facing high rates of unemployment and underemployment. ADR presents an untapped opportunity to engage young professionals, particularly graduates of law, peace studies, and social sciences, in meaningful and service-oriented careers.

To unlock this potential, state governments can establish ADR training programs in universities and law schools across Northern Nigeria. These programs should include clinical components that allow students to gain practical experience in mediation and arbitration procedures. By integrating ADR into academic curricula, institutions can equip future practitioners with both theoretical knowledge and hands-on skills essential for effective dispute resolution.

In addition, Ministries of Justice and the judiciary should create structured internship pathways and mentorship schemes for young professionals interested in ADR. These initiatives would expose aspiring neutrals to real-world practice, enhance their understanding of ADR, and help build a pipeline of skilled practitioners in the region.

Furthermore, collaborations with professional bodies, including the Chartered Institute of Arbitrators (CIArb) and the Nigerian Bar Association (NBA), can support early-career development by offering training, certification, and networking opportunities. These partnerships would not only professionalise ADR practice among youth but also connect them to broader national and international ADR communities.

By engaging youth as trained mediators, conciliators, and community liaisons, states can build local ADR capacity. At the same time, they will foster peacebuilding, employment, and leadership among young people.

Alignment with Global Standards.

Nigeria’s Arbitration and Mediation Act 2023 provides a modern legal framework. By embracing ADR, Northern states can align local practice with international best practice, making it easier for businesses operating across borders to resolve disputes efficiently.

Comparative Lessons and Regional Best Practices.

Several African countries provide valuable examples of how Alternative Dispute Resolution (ADR) can be both institutionalised and adapted to local contexts, ensuring broader access to justice and greater efficiency in resolving disputes.

In Rwanda, the government has successfully implemented Abunzi Committees, which are composed of trained community mediators who resolve civil and land-related disputes at the grassroots level. These committees handle over 80 percent of non-criminal matters, offering a model that is not only cost-effective but also highly trusted by the local population. The system integrates traditional dispute resolution values within a formal legal framework, making it both accessible and legitimate.

In Kenya, the Judiciary has institutionalised court-annexed mediation, making it a compulsory step in certain civil proceedings. This approach has helped reduce case backlogs and enhanced public confidence in non-adversarial justice systems. Additionally, Kenya’s Mediation Accreditation Committee plays a vital role in maintaining professional standards, supporting capacity development, and ensuring quality control across the country’s mediation ecosystem.

South Africa has established the Commission for Conciliation, Mediation and Arbitration (CCMA), a government-funded body that effectively manages employment-related disputes. The CCMA has become a model of large-scale ADR implementation, resolving thousands of cases annually while maintaining accessibility, affordability, and procedural fairness.

Northern Nigeria can learn from these models by adapting their features, including community ownership, legal recognition, and public education, to suit the region’s unique legal and cultural context.

Policy and Practice Recommendations.

To implement ADR effectively across Northern Nigeria, policy reform must go beyond courts. Governments should integrate ADR into social institutions and service delivery at every level:

Local government councils have a pivotal role to play in expanding access to justice through ADR. By hosting mediation centres at the community level, they can provide timely and cost-effective mechanisms for resolving land, tenancy, and communal disputes. These centres would be more approachable for citizens, particularly in rural areas, than formal court systems.

Religious institutions, particularly mosques and churches, also hold significant influence in Northern Nigeria. These institutions can collaborate with the Ministry of Justice to formalise informal dispute resolution practices, ensuring that they align with national legal standards while retaining cultural legitimacy. Such partnerships can help bridge the gap between tradition and formal law, fostering greater public trust in ADR outcomes.

In addition, state procurement laws should be updated to mandate the inclusion of ADR clauses in all public contracts. This policy would ensure that commercial disputes involving government projects are addressed efficiently, confidentially, and without the delays commonly associated with litigation. By embedding ADR in contract frameworks, states can improve contract enforcement and investor confidence.

Furthermore, states should adopt legislation that mirrors the intent and scope of the Arbitration and Mediation Act, 2023, thereby domesticating its provisions to reflect local realities.

Conclusion

Embracing the Arbitration and Mediation Act, 2023, offers Northern Nigeria an unprecedented opportunity to align with global best practices such as the UNCITRAL Model Law and the Singapore Convention on Mediation. This alignment will reduce delays, curb procedural abuse, and enhance the credibility, enforceability, and efficiency of dispute resolution across the region.

Beyond legal harmonisation, a robust and inclusive ADR ecosystem will strengthen investor confidence, reduce judicial backlogs, and promote social stability. Importantly, integrating women and youth into the ADR workforce will create new professional opportunities, while partnerships with religious and traditional leaders can ensure cultural legitimacy and grassroots acceptance.

At the same time, ADR must be understood as more than a domestic reform. For Northern Nigeria, located at the crossroads of West and Central African commerce, ADR is a tool for cross-border dispute resolution, investment protection, and commercial diplomacy. Effective integration of ADR will enable the region to support international trade agreements such as the AfCFTA and the ECOWAS Trade Liberalisation Scheme, while enhancing Nigeria’s global reputation as a reliable partner in investment and trade.

To actualise these gains, Northern states must commit to: (i) establishing ADR centres in Ministries of Justice and High Courts; (ii) partnering with local institutions to formalise culturally aligned ADR models; (iii) mainstreaming public awareness and legal education; (iv) supporting capacity-building for young and female ADR professionals; and (v) embedding ADR clauses in public contracts and business agreements.

With these reforms, Northern Nigeria can emerge not only as a strong participant in Nigeria’s evolving justice framework but also as a regional hub for fair, fast, and culturally coherent dispute resolution.

References

Arbitration and Mediation Act, 2023 (Nigeria). Laws of the Federation of Nigeria.

Arbitration and Conciliation Act, Cap A18, Laws of the Federation of Nigeria, 2004.

Lagos Multi-Door Courthouse (LMDC). (2023). About LMDC. Retrieved from https://lagosmultidoorcourthouse.org

United Nations Commission on International Trade Law (UNCITRAL). (2006). UNCITRAL Model Law on International Commercial Arbitration (with amendments as adopted in 2006).

United Nations Commission on International Trade Law (UNCITRAL). (2019). United Nations Convention on International Settlement Agreements Resulting from Mediation (the Singapore Convention on Mediation).

International Centre for Settlement of Investment Disputes (ICSID). (2023). About ICSID. Retrieved from https://icsid.worldbank.org

African Union. (2018). Agreement Establishing the African Continental Free Trade Area (AfCFTA). Addis Ababa: African Union.

Economic Community of West African States (ECOWAS). (2023). ECOWAS Trade Liberalisation Scheme (ETLS). Abuja: ECOWAS Commission.

Government of Rwanda. (2022). The Abunzi Mediation Committees. Kigali: Ministry of Justice.

Judiciary of Kenya. (2022). Court-Annexed Mediation Program. Nairobi: Mediation Accreditation Committee.

Commission for Conciliation, Mediation and Arbitration (CCMA). (2023). About the CCMA. Johannesburg: Government of South Africa.

Chartered Institute of Arbitrators (CIArb). (2023). CIArb Training and Membership Pathways. London: CIArb.

Nigerian Bar Association (NBA). (2023). NBA Section on Business Law (SBL): ADR Initiatives. Abuja: NBA.