Lagos High Court Suspends Water Concession Deal Over Transparency Concerns

• Lagos State Government's plans to concession public water infrastructure have been met with opposition from Corporate Accountability and Public Participation Africa (CAPPA).
• A Memorandum of Understanding (MoU) between Lagos State, CHEC, and Naston Engineering Nigeria Limited was signed on July 9, 2026, for scoping and technical definition of a concession deal, with CAPPA continuing to demand transparency.
• The progression of the concession deal, which includes plans for prepaid metering in the concession area, could lead to compliance exposures for lawyers advising clients on water infrastructure projects in Lagos.
• Public participation in water policy-making is essential to ensure that the needs and concerns of all stakeholders are taken into account.

The proposed concession deal between Lagos State and a Chinese construction company, CHEC, is actively progressing, though it remains a subject of controversy.

The Lagos State Government has been warned by Corporate Accountability and Public Participation Africa (CAPPA) against its plans to concession parts of the state's public water infrastructure. CAPPA, in a statement, expressed concerns that the policy could deepen hardship for residents and undermine access to affordable and reliable water. The warning comes after the government announced its intention to implement prepaid metering as part of the concession deal. Prepaid metering has been a contentious issue in Nigeria, with many critics arguing that it will disproportionately affect low-income households who cannot afford the initial costs of purchasing meters.

The proposed concession deal between Lagos State and a Chinese construction company, CHEC, is actively progressing. A Memorandum of Understanding (MoU) between Lagos State, CHEC, and Naston Engineering Nigeria Limited was signed on July 9, 2026, for scoping and technical definition, which is expected to lead to a concession agreement. CAPPA is demanding the publication of the full concession agreement, citing transparency concerns. While the general scope of the MoU has been announced, the detailed terms of the eventual concession agreement are still being developed, fueling speculation about the terms of the deal. This lack of full transparency has raised questions about the government's accountability and the potential risks associated with the concession agreement.

The progression of the concession deal, which explicitly includes plans for prepaid metering in the concession area, could have significant implications for water infrastructure projects in Lagos. Lawyers advising clients on such projects should be aware of the potential compliance exposures related to these developments. These developments highlight the need for greater public participation in water policy-making, ensuring that the needs and concerns of all stakeholders are taken into account. As the government reassesses its approach to water infrastructure management, it is crucial that transparency and accountability are prioritized to avoid exacerbating existing social and economic challenges.

Lawyers advising clients on water infrastructure projects in Lagos should watch for potential compliance exposures related to the suspension of prepaid metering and the concession deal, and be prepared to advise clients on the implications of these developments.

Source: Original reporting via Vanguard News