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August 16, 2024
This assertion was made by Circuit Judge Millett of the US Court of Appeals for the District of Columbia, as stated in a court document obtained by SaharaReporters.
In a legal case involving Zhongshan Fucheng Industrial Limited and the Federal Republic of Nigeria, the government was accused of collecting taxes from the company's investment prior to contract termination.
This assertion was made by Circuit Judge Millett of the US Court of Appeals for the District of Columbia, as stated in a court document obtained by SaharaReporters.
The documents reveal that Ogun State had entered into a joint venture agreement with a Chinese firm and another company to establish the Ogun Guangdong Free Trade Zone Company.
According to document, the Nigeria Export Processing Zones Authority (NEPZA), a federal government agency responsible for regulating free-trade zones in Nigeria, subsequently delegated the management and operation of the Ogun Guangdong Free Trade Zone to the company, effectively handing over control to the firm.
“In 2010, the Ogun Guangdong Free Trade Zone Company contracted with Zhongshan’s parent company to develop an industrial park in the free-trade zone. The goal was for Zhongshan’s parent company to develop the park and build factories in it for zone tenants to use,” it said.
It noted that Zhongshan’s parent company then “effectively transferred its rights” to Zhongshan, which conducted its Nigeria operations through its subsidiary, Zhongfu International Investment (NIG).
It was stated that the organisation, Zhongshan, “invested millions of dollars and significant resources to develop the park”.
The court paper further says “Zhongshan built out infrastructure in the industrial park, including roads and utilities. It also opened services such as a hospital, hotel, supermarket, and bank”.
“The free-trade zone later amended its charter and made Zhongshan a part-owner of the zone,” it says.
It was further noted that by 2016, businesses had moved into the zone and Nigeria had collected approximately N160 million in tax revenue from the free-trade zone, which amounts to hundreds of thousands of U.S. dollars.
The court opined that “Nigeria collected hundreds of thousands of dollars in tax revenue from Zhongshan’s investment” before termination of agreements in the first half of 2016.
The state government was quoted as stating that a different Chinese company was legally entitled to Zhongshan’s share of the free-trade zone and that Zhongshan had defrauded Ogun.
Kayode Akinmade who is the Special Adviser to the Ogun State governor, Dapo Abiodun, on media, had refuted that the firm built any structure in the free trade zone, instead “only a perimeter fencing was built”.
Meanwhile the company at the centre of the conversation, Zhongshan has stated that it is ready to have talks with Nigerian officials with a view to resolving the issues.
The development had led to seizure of jets, which are part of Nigeria's presidential air fleet.