Colonialism, Commerce, and International Law

International law facilitated and shaped the imposition of colonialism in Africa. The Berlin Conference (1884–1885) formalized colonial spheres of interest in Africa. The Berlin Act,Footnote ² which reflected little or no input from Africans, nonetheless became a key basis for the establishment of European colonial possessions in Africa. The Berlin Act led to highly monopolistic colonial possessions in Africa that were enforced with coercion and violence. In 1886, the Royal Niger Company (the Company), which was given a royal charter to undertake administration of territory in part of what later became Nigeria, entered into similar, and at times identical, treaties of protection with various indigenous rulers.Footnote ³ These treaties became a basis for colonial property claims and indirect rule. The Company enacted a broad range of regulations that dealt with business, commercial, and other legal matters. Precolonial lawmaking by the Company was not the product of any sustained engagement with local representatives or authorities. Further, such lawmaking reflected an overriding focus on the promotion of British commercial interests, as well as policies intended to give the Company both political control and commercial dominion over territories under the Company's administration. As the Company exemplifies, imperialism and colonialism included significant commercial aspects, which after the slave trade era typically focused on extractive activities.

The creation of monopolistic zones of European interest underscores the tremendously anti-competitive nature of the colonial endeavor itself in ways that have continuing resonance today. Colonialism channeled the colonized into exclusive relationships with a designated European colonial power. As a result, countries in Africa had limited ability to seek competitive terms of engagement from alternative sources. The intensification in recent years of South-South engagement in Africa may be modifying these past patterns of relationships.

In Nigeria, colonial activities were structured to prevent local competition against British commercial interests. Vertical relationships between colonial powers and colonial possessions were often highly beneficial to the colonial power. Colonialism supported British commercial interests typically with insufficient attention to questions of local economic empowerment and outcomes.

Legal Transplants and Borrowing in African Legal Systems

Legal transplants and other forms of borrowing are pervasive aspects of legal systems.Footnote ⁴ Colonial administrators in colonial Africa implemented dual legal systems that separated customary law, which governed most local populations, from laws directly derived from legal frameworks of the colonial power that applied to resident Europeans and, at times, elite Africans.Footnote ⁵ Legal borrowings in the commercial law realm in colonial and postcolonial contexts in Africa have typically been based entirely or to a significant degree on external models, often with not enough customization for local contexts. This has left insufficient room for hybrid frameworks more attuned to local contexts.

In many British colonies, English law was a direct or indirect source of many laws. As a result, significant legal continuity existed during and after colonialism, particularly in the commercial law realm. For example, between 1861 and 1876, no local laws governed companies operating in Nigeria, and all companies operating in Nigeria were foreign; English corporations operating in Nigeria had limited liability only if they were registered in England.Footnote ⁶ From 1876 to 1912, the lack of local laws continued, and English common law and doctrines of equity were “deemed applicable to Nigeria” and continue to form part of Nigerian company law today.Footnote ⁷ The first local company law in Nigeria was adopted in 1912.Footnote ⁸ An estimated 90 percent of the provisions of the Nigerian Companies Act of 1968 were identical or substantially similar to the UK Companies Act, 1948.Footnote ⁹

External facing patterns of lawmaking, which continue to be widespread today, are reinforced by legal and other experts who continue to play a key role in varied contexts and who may be engaged by donors or others. Legal education and training also contribute to external-facing lawmaking. Legal borrowings tend to be sticky in that they may continue to shape law long after their adoption.

British colonial authorities also tended to select local rulers who would value and take account of British interests, which often compromised their ability to represent local interests and needs. Local rulers selected or validated by British colonial authorities were kept in check by threat of force and removal from power. The penalty for opposing British interests could be quite high. Other largely external actors, including missionaries, played an important role in elite formation, particularly because access to education in missionary schools was an important pathway for many new elites. In addition to creating pathways for new elites to emerge, British rule shaped the power and authority of existing rulers. African elites at independence inherited a fabric of colonial laws governing everyday activities that was inflexible and not customized for local contexts or the benefit of the vast majority of the population. The power, status, and authority of elites who came to rule after colonialism were inscribed in legal frameworks at multiple levels, often in ways that were not sufficiently scrutinized at independence. This has made such elites powerful incumbents able to resist policies that might attenuate their power and privileges. Decolonization had a limited legal impact, particularly with everyday laws that affect economic opportunity. Law thus remained essentially colonized and disruption of existing laws in many cases remains a distant possibility, even today.

Continuity in business law frameworks has thus been evident in most countries in Africa following independence. Such legal frameworks were not typically intended to promote economic opportunities for most Africans or to enhance development prospects or encourage local companies to compete against external commercial interests. This failure to disrupt the more deleterious of such frameworks at independence has had detrimental consequences for economic opportunities.

The development of law in many African countries, even after the end of formal colonialism, has continued to involve problematic patterns of borrowing with an external orientation. Externalized visions of law make the creation of needed hybrid institutions more difficult. Externalized visions of law tend to locate hybrid institutions and practices in the informal realm. The informal sector is large in many countries in Africa and is thought to constitute some 70 percent of Nigeria's economy. Hybrid institutions are likely an important element in economic development.Footnote ¹⁰ Externalized conceptions of law have left insufficient space for needed disruption of post-colonial legal frameworks. Such external visions of law also hinder approaches to legal reform that are truly hybrid, transformative, and innovative.