ARBITRATION is an alternative or effective way of resolving disputes outside of court through an independent and where one or more neutral third-party decision maker otherwise known as an arbitrator makes a final and binding decision resolving the dispute. The role of the arbitrator is to help to dispute parties in achieve coming to a consensus or amicable agreement.
The World Intellectual property organization (WIPO) has advocated for the use of Arbitration for resolving IP disputes and has gone further to establish an Arbitration & Mediation Centre for resolving IP disputes.
Arbitration practice in Nigeria is primarily regulated by the Arbitration and Conciliation Act (ACA) which incorporates the UNCITRAL Model Law of International Commercial Arbitration 1985.
Though we do not have as yet have specialized IP tribunals or courts as found in innovative jurisdictions like China. Nigeria has adopted various types of alternative dispute mechanisms which can be adequately used to handle IP disputes between stakeholders in the IP industry.
The creative industry is a fast-growing sector in many countries around the world, and Nigeria is no exception. However, with the rise in the industry, there has also been a corresponding rise in Intellectual Property (IP) disputes.
The creative industry in Nigeria contributed $11.8 billion to the GDP in 2016, with the music industry growing by 9% and the movie industry contributing 2.3% of the GDP. The global fashion industry is worth $2.5 trillion, with Africa’s share estimated at less than 1%, but Nigeria accounts for 15% of the Sub-Saharan fashion market, worth $31 billion. The industry has grown significantly due to increased investment, government support, and demand for Nigerian cultural products. However, economic, political, and social factors can affect its value.
TRIGGERS FOR IP DISPUTES
IP disputes arise when a party purportedly infringes on the intellectual property rights of another. Examples of IP rights include; Copyright, Trademarks, Patents, Trade secrets, Domain names, Geographical Indications, etc. In Nigeria, some of the causes of the rise in IP disputes include Infringement, a lack of understanding of IP laws, inadequate enforcement mechanisms, invalidity, ownership or breach of contract, and a weak legal system. Additionally, the growth of the creative industry has made it easier for individuals and organizations to create and distribute content, leading to an increase in the number of potential infringement cases.
The regulatory frameworks in Nigeria include the CopyRights Act Cap C28, Trade Marks Act Cap T13, Patent & Design Act P2 and the Merchandise Marks Act Cap M10, etc, and the laws are enforced by the Nigerian Copyright Commission (“NCC”), The Trademark, Design and Patents Registry which is a subdivision of the Ministry of Industry, Trade & Investment, etc.
ARBITRARILY refers to the question of whether a particular issue in dispute is capable of resolution by arbitration
ELEMENTS OF AN ARBITRABLE INTELLECTUAL PROPERTY INFRINGEMENT
Availability of the Right Parties:
Only parties have the right to seek arbitration. And the right parties consist of the affected person and the infringer(s) except for a licensed person or with the use of power of attorney. An arbitration agreement is not invalid because of the death of a party to the arbitration. In such an event, the arbitration agreement is enforceable by or against the personal representative of the deceased (section 3, ACA). Arbitration parties must be treated equally and be given the full opportunity to present their case (section 14, ACA).
There has to be an Existing Intellectual Property:
For an IP infringement to be arbitrable, there has to exist an intellectual property itself and this can be enforced through the definition of what type of IP infringement took place. A mere imagination is not arbitrable.
Appointment of a Professional Arbitrator:
A lawyer mustn’t fail or neglect to inform his client of the option of alternative dispute resolution mechanisms before restoring to or continuing litigation on behalf of his client. Intellectual Property is a technical subject matter. Therefore, it is better to engage the services of an Arbitrator who has specialized knowledge of specialized Proper. An arbitrator has to be skilled in resolving a peaceful and lawful decision, which makes it better than litigation where not all the time the judges are experts in intellectual property rights and Parties to arbitration are allowed to seek the assistance of courts in Nigeria to conduct their arbitration. Such assistance may include the appointment of an arbitrator where the parties are unable to agree on the appointment of an arbitrator.
The parties can agree to terminate an arbitrator’s appointment because of the arbitrator’s inability to perform their functions (section 10(b), ACA).
Also read: Written Contracts 101 – Benefits and Tips to Write Better in 2023
Proceedings in an Approved Arbitration Centre:
There is a need to declutter the Nigerian litigation system because IP litigation matters are time-consuming and it could take 1-10 years from the court of first instance which is the Federal High Court to the Supreme Court.
A special IP Court is an independent public judicial body that can operate at national or regional levels to adjudicate IP disputes and enforce IP rights, and incidental disputes.
Establishing a specialized court improves the quality of justice available. Examples of arbitral institutions in Nigeria include the Regional Centre for International Commercial Arbitration Lagos, Lagos Court of Arbitration, Lagos Chamber of Commerce International Arbitration Centre, etc.
Challenges to the arbitrability of a particular dispute can be presented to either a national court or an arbitral tribunal because some IP disputes are of a criminal nature and thus not arbitrable but where arbitration parties are not allowed to file their cases in court over a dispute that is covered by an arbitration agreement. One of the most notable cases is Owners of MV Lupex v. Nigerian Overseas Chartering & Shipping Ltd (MV Lupex)
Availability of an Arbitration Clause in Agreements:
Section 1 of the Arbitration and Conciliation Act makes it mandatory for an arbitration agreement to be in writing. Such agreement can either be contained in a clause in their commercial contract or any other written evidence and where there is no arbitration agreement in writing before the dispute arose, the parties are free to subsequently agree to proceed to arbitration.
Enforceability of Awards:
An IP infringement is arbitrable if there is an available reward for one or both parties involved in the dispute. And the awards granted in determining infringement and validity might be enforceable against any infringer either be deemed inter partes (between parties) or erga omnes (amongst all) e.g. patent rights which are judgments that are binding on even future infringers.
Nigeria is a signatory to numerous international treaties in intellectual property. And they include: The Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention), the World Intellectual Property Convention (“WIPO”) of 1970, the Agreement on Trade-Related Aspects of Intellectual Property Rights (“TRIPS”), Berne Convention and Rome Convention for the Protection of Performers, Producers of Phonograms & Broadcasting Organisation, etc.
The essence of this is that Nigerian awards are recognized and are generally capable of enforcement in other contracting states, in the same way as domestic awards emanating from those states.
Other benefits include:
- Quick and effective judgment
- International recognition: In regards to the International nature of Intellectual Property disputes. IP judgments are not limited to only the local jurisdiction of a petitioner in a disputing party.
- Flexibility: Arbitration by its nature is flexible. The parties can choose the Arbitrator, time, conduct of the proceedings and venue of the proceedings, the applicable law to govern the proceeding, etc
- Confidentiality: Arbitration ensures confidentiality between parties. IP disputes may involve trade secrets and commercial benefits. These are better kept confidential to avoid being exploited by the public, unlike IP litigation.
- Reputation protection: Arbitration also ensures that parties’ trade reputation is protected and this is a commercial benefit.
Arbitration is considered a preferred mode of resolving IP infringements because of its best features, especially the erga omnes (among all) effect. Not all types of intellectual property rights infringements are arbitrable; however, for them to be, certain fundamental elements have to be in existence. Intellectual property in today’s world plays a major role in developing and boosting the world economy. Where these rights are adequately protected, enforced, and implemented, they have a lot of benefits for the economy and society at large.
- Arbitration and Conciliation Act, Cap A18, Laws of the Federation of Nigeria 2004.
- Arbitrability of IP Disputes: obalarbitrationreview.com/guide/the-guide-ip-arbitration/second-edition/article/arbitrability-of-ip-disputes#footnote-149
- Legal Practitioner Act Legal Practitioners Act Cap. L11 LFN 2004
- Creative Sector 2021 Skills Gap Report JOBBERMAN NIGERIA 2021 www.jobberman.com
- Enforcing Intellectual Property Rights in Nigeria: Navigating Towards Arbitration and Specialised Court https://www.globallawexperts.com/NewsArticle.aspx?PID=2771
- Arbitration Process in Nigeria: A Step-by-Step Guide: https://oal.law/arbitration-process-in-nigeria-a-step-by-step-guide/?utm_source=mondaq&utm_medium=syndication&utm_term=Litigation-Mediation-Arbitration&utm_content=articleoriginal&utm_campaign=article
- Adejoke O. Oyewunmi, ‘’Nigerian law of intellectual property’’
- F.O Babafemi, Intellectual property: The law and practice of copyrights, trademarks, patents, and industrial design in Nigeria.
- ICMC Nigeria: professional ADR skills accreditation and certification course training manual