In a high-profile legal showdown, the Federal Government of Nigeria has taken Seplat Petroleum and twelve of its top officials to court, accusing them of evading a staggering $37.5 million in tax payments linked to the company’s 2010 acquisition of oil assets.
The five-count charge, filed before a Federal High Court in Lagos, alleges serious tax violations, including failing to pay the required stamp duty on purchase agreements for assets in the OML 4, OML 38, and OML 41 fields, as well as committing acts of document forgery.
The case, set for trial on February 28, 2025, has already attracted widespread attention due to the high-profile nature of the accused, including Roger Brown, the CEO of Seplat, and other top executives such as Samson Ezugworie, Eleanor Adaralegbe, and Steve Ojeh. The Federal Inland Revenue Service (FIRS) is spearheading the legal action, seeking justice and accountability for the alleged tax fraud.
The Allegations
The charges laid before the Lagos Federal High Court by the Federal Government outline multiple violations of Nigerian tax laws. According to the prosecution, Seplat Petroleum and its executives unlawfully withheld a total sum of $37.5 million, which includes the original stamp duty and interest accruing over the years, from the Federal Government.
The disputed amount is related to the acquisition of oil mining leases (OMLs) 4, 38, and 41 by Seplat in 2010. Under the Stamp Duties Act, a specific duty is due whenever certain transactions, such as the acquisition of valuable assets, are carried out. In this case, the failure to remit this payment constitutes a violation of the law, with potentially severe penalties.
One of the most alarming aspects of the charges is the accusation of document forgery. According to court documents, the defendants allegedly forged the stamp duty seal of the Commissioner of Stamp Duties and placed it on the purchase agreements to falsify the documents and avoid paying the necessary taxes. The prosecution claims this deliberate act of counterfeiting was aimed at giving the impression that the taxes had been duly paid, when in fact, they had not.
“These actions undermine the integrity of our tax system,” said a spokesperson for the Federal Inland Revenue Service. “Such deliberate evasion and forgery have far-reaching implications not just for revenue collection but also for the reputation of the business community in Nigeria.”
Seplat’s Response
While the company has yet to publicly comment in detail on the allegations, sources close to Seplat suggest that they are preparing a strong defense. “We are confident that the facts will clear up any misunderstandings during the trial,” an anonymous source within the company stated.
In a statement, Seplat acknowledged the lawsuit and confirmed that it would cooperate fully with the legal process. The company has also emphasized its commitment to complying with Nigerian laws and regulations, adding that it has always worked closely with relevant authorities.
“We are committed to maintaining the highest standards of corporate governance, and we intend to contest these charges in court,” said a senior official from Seplat. “Seplat has a long history of investment in Nigeria, and we are committed to the country’s growth and prosperity.”
Legal Implications and Penalties
The charges brought against Seplat and its executives under the Stamp Duties Act and the Federal Inland Revenue Service (FIRS) Establishment Act carry severe penalties. If convicted, the company and its top officials face heavy fines and possible imprisonment.
The specific violations listed in the charges, including failure to pay stamp duties and the act of forgery, could result in fines ranging from 200% to 500% of the unpaid tax, depending on the severity of the offense. The charge of counterfeiting the seal of the Commissioner of Stamp Duties is particularly serious, carrying a potential sentence of imprisonment, as stipulated under Section 43(c) of the FIRS Establishment Act.
“The case against Seplat serves as a reminder of the need for strict adherence to tax laws,” said a legal expert familiar with Nigerian tax legislation. “Companies operating in Nigeria must ensure they comply with all applicable regulations, as failure to do so could lead to significant legal and financial consequences.”
Background on Seplat’s Acquisition
The disputed tax stems from the 2010 acquisition of oil assets in OMLs 4, 38, and 41, which Seplat Petroleum, through its partnership with Royal Dutch Shell, purchased from the state-run Nigerian National Petroleum Corporation (NNPC). The acquisition was part of a strategic effort by Seplat to strengthen its position in the Nigerian oil and gas sector.
At the time of the deal, the Nigerian government had been working to increase local participation in the oil industry, and Seplat’s purchase was seen as a significant step in that direction. However, the failure to remit the required taxes on the transaction has now led to the current legal battle.
A Growing Spotlight on Corporate Compliance
This legal action is not the first time Seplat has faced scrutiny over its financial and operational practices. The company has been in the public eye due to its significant role in Nigeria’s oil industry and its commitment to transparency. However, with the Federal Government now pursuing a case against the company, questions are being raised about corporate governance in the Nigerian energy sector.
“As Nigeria continues to attract foreign investment, it is essential that both local and international companies operate within the bounds of the law,” said a representative from the Nigerian Economic Summit Group (NESG). “This case is an important one, as it sets a precedent for how Nigeria will handle tax evasion and corporate governance issues in the future.”
