Since 2024, the Nigerian hospitality industry and related private sector stakeholders have been in a loggerhead with the regulatory authorities over new laws, especially registration and other regulatory requirements.
For over a year, efforts to resolve the issues have ended in a stalemate, until a recent federal high court ruling, which offered a bit of relief to the hoteliers.
This article reviews the bone of contention, offers clarity on the issue, which hotels are exempted from the new laws, why and why the state and federal authorities are still at loggerheads on the implementation of the same law for the same industry.
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Earlier contention
During the Goodluck Jonathan administration, the Lagos State government and the then National Tourism Development Corporation (NTDC), now National Tourism Development Authority (NTDA), had protracted battles over who regulates the tourism/hospitality industry, which also saw both in court.
The Lagos State government had earlier enacted the Lagos State Hotels Licensing Authority Law, 2010, which empowered it to regulate the sector, and which also did not go well with the then NTDC, hence the challenge in the court of law.
At the peak of the battles and the controversies they generated, the hotels and related outfits were forced to comply with two tiers of regulations and payments.
But on July 19, 2013, the Supreme Court dismissed a suit filed by the Attorney General of the Federation, seeking the control of the hospitality industry by the NTDC, while upholding the contention of the Attorney General of Lagos State that the 1999 Constitution, as amended, only empowered the National Assembly to regulate tourist traffic and not hotel registration or licensing.
Current contention
With the Supreme Court ruling in 2013, the industry enjoyed respite until last year, when the National Institute for Hospitality and Tourism (NIHOTOUR) insisted on implementing the NIHOTOUR Act 2022, which included all practitioners, hotels and related outfits under its regulatory power.
But hospitality industry stakeholders are fighting back, insisting that the NIHOTOUR Act 2022 was not reviewed as advised, that it contravened some existing laws and that it is even the NTDA, with the NTDA Act 2022, that repealed the old NTDC Act of 2004, which should regulate, but lost earlier to the states.
According to Samul Alabi, president, Hotel Owners and Managers Association of Lagos (HOMAL), while some of the powers bestowed on NIHOTOUR are validly necessary for its operation as a training agency of the Federal Government, “we considered all those aspects dealing with certification and registration of all employees, grading of personnel and quality of services rendered by hospitality, travel and tourism in Nigeria as invalid and ultra vires the constitution”.
It would be recalled that in 2017, tourism stakeholders were invited to the Federal House of Representatives to review a bill to set up NIHOTOUR and at the public hearing, the stakeholders objected to many sections of the bill on the basis that the sections usurped the power of State Governments and functions of some other Federal Government agencies as provided by the 1999 Constitution as amended.
Yet, the NIHOTOUR ACT 2022 was enacted without addressing the grey areas, and that is the major reason for the current contention as industry stakeholders kick against its implementation.
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NIHOTOUR’s stand
The Abisoye Fagade-led institute is insisting that the federal parastatal under the Ministry of Culture, Arts, Tourism and Creative Economy has the statutory obligation and legal rights to implement the new ACT, noting that the implementation will ensure improvements across the industry, from professionalism, standardisation, capacity building, to world-class and harmonised industry practice and services.
Based on the above, the NIHOTOUR went on with the implementation across the country, starting with Lagos and Abuja, where it met a series of resistance. In the Lagos case, some hotels were reportedly sealed by the agents of NIHOTOUR, some staff members were attacked, and some were detained.
Hotels and stakeholders’ resistance/legal battles
The various associations of the hospitality industry fought back through the Federation of Tourism Associations of Nigeria (FTAN), the umbrella body of private sector tourism in the country, amid some ongoing legal battles.
There are many ongoing cases in Lagos and Abuja between NIHOTOUR and hoteliers regarding the regulation, including the Hotel Owners and Managers Association of Lagos (HOMAL), Hotel Owners Forum Abuja (HOFA), and separate cases involving 16 hotels in Abuja, among others.
The Badaki Aliyu-led FTAN noted that as a federation, it has a right to protect the interests of its members, especially when the authorities are only mindful of implementing the law without human face.
The Kogi State-born hospitality expert explained that the federation is not against regulation or the implementation of the law, but is insisting on addressing the grey areas, which it has highlighted several times to the NIHOTOUR to ensure the survival of their businesses and full compliance.
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Lagos and HOMAL’s victory
So far, the battles over regulation and control have been raging, with some expected and unexpected outcomes.
One of the expected outcomes is a Federal High Court ruling on October 15, 2026, in Suit No. FHC/L/CS/906/2025, in favour of HOMAL, granting all the reliefs sought by the association.
The court, sitting in Ikoyi, Lagos last week, gave judgment that “the provision of the NIHOTOUR ACT 2022 bordering on or relating to standardisation, registration and certification of manpower requirement of hospitality and tourism and to impose minimum manpower standards required to operate hospitality sector or to stipulate basic, intermediate and advanced skills required in the hospitality sector and tourism sector or to certify or register qualified personnel in the hospitality, hotels and tourism sector wholly situated and operating within Lagos State, is illegal, ultra vires and unconstitutional”.
It also affirmed that it is the Lagos State Hotels Licensing Authority Law 2010 that regulates tourism within Lagos State, and that “NIHOTOUR lacks the constitutional power under the National Institute for Hospitality and Tourism ACT 2022 to regulate and revoke the Operating License issued by the Lagos State Government by virtue of the Lagos State Hotels Licensing Authority Law to the claimants’ members”.
Also, the court gave a mandatory order to NIHOTOUR to refund all payments made by HOMAL members pursuant to its invasion and enforcement on its members, and the sum of N10,000,000.00 (Ten million naira only) is awarded against NIHOTOUR in favour of HOMAL, amid a Perpetual Order of Injunction given to restrain NIHOTOUR and its agents from forceful arrest, detention, collection of money/fees and enforcement pursuant to the provisions of the NIHOTOUR (Establishment Act, 2022) henceforth.
With the above, HOMAL, other non-member hotels and hospitality stakeholders in Lagos are jubilant that justice has prevailed.
The HOMAL president decried the ruling as a significant development in the dispute over the respective regulatory responsibilities of federal and state authorities in Nigeria’s hospitality and tourism industry, while Adeniyi Ologun, director general, HOMAL, noted that it is a big relief and way forward for the industry, particularly Lagos.
Implications for hospitality industry
With the judgment, Lagos State is out of NIHOTOUR’s jurisdiction and so also other states based on the Supreme Court’s ruling of July 19, 2013 that upheld the contention of the Attorney General of Lagos State that the 1999 Constitution, as amended, only empowered the National Assembly to regulate tourist traffic and not hotel registration or licensing.
It implies that hoteliers across the country can confront the NIHOTOUR and its agents on any regulation and enforcement, which the court has declared “illegal, ultra vires and unconstitutional”.
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Battle continues
However, the NIHOTOUR is not satisfied with the Federal High Court’s judgment and is moving to challenge it. The institute insisted that it acted under the NIHOTOUR Establishment Act, 2022, and as part of its statutory mandate to register, certify, and set standards for the hospitality and tourism workforce nationwide.
The hoteliers are also ready for long court battles. ‘‘Our association is ready to defend any appeal action taken, we assure our members to continue to run their business without fear of molestation from NIHOTOUR or any other Federal Government Agencies,’’ Alabi noted.
For now, HOMAL and other stakeholders stand by the court judgement.
“Nevertheless, until the judgement is set aside by a higher court, it defines our members’ relationship with NIHOTOUR,” Alabi concluded.
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